Ag Policy Blog

Trump Infrastructure Plan Could Require a Lot of Change

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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President-elect Donald Trump has a plan for $1 trillion in infrastructure development that would rely heavily on private investment driven by tax breaks.

A $1 trillion proposal could demand change. It could take a lot of change, really, because the infrastructure plan appears to rely on tolls instead of increasing fuel taxes.

The president-elect is releasing a video Monday to outline some of his domestic agenda.

As Politico reported over the weekend, there are some different strategies being floated. The main funding consideration involves tax credits for construction, which would then be paid back by through user fees. In the case of roads, that means tolls. The plan is drawing some fire from both sides of aisle, though some Republicans who opposed infrastructure spending under the current administration appear more open to such projects now.…

Others, however, are calling the Trump plan, "a trap." Ronald Klain, who worked for both President Barack Obama in his administration and Hillary Clinton's campaign, wrote a piece in the Washington Post late last week criticizing Trump's infrastructure plan, calling it "a tax-cut plan for utility-industry and construction sector investors, and a massive corporate welfare plan for contractors." Klain argues the plan doesn't directly fund roads, bridges, airports or other major infrastructure plans. Klain further argued the big beneficiaries would be investors, not actual construction workers.…

Industries are looking to get on board, however. The Association of American Railroads wrote the Trump transition team on Monday basically to say, don't forget about railroads, The Hill reported.

"A critical component of our national infrastructure is the freight rail industry, which generated $274 billion in economic activity in 2014 while supporting almost 1.5 million jobs throughout the country,” wrote Edward Hamberger, president and chief executive officer of AAR. “As the transition team begins laying the groundwork for investing in other areas of our infrastructure, freight railroads can serve as an example of how smart investments can spur huge economic impacts.”…

Sen. Charles Schumer, D-N.Y., now the incoming Senate Minority Leader, told Fox News Sunday that an infrastructure plan could be possible but it has to include more than just tax cuts, the Fiscal Times wrote.

“But that infrastructure bill has to have certain things for us to support it,” he added. “It can’t just be tax credits. That won’t be enough.” In short, Schumer and other Democrats are calling for a more traditional government financed public works program hearkening back to the New Deal.…

Given the infrastructure needs in rural America, the debate about financing a major infrastructure plan will be critical to watch going forward. People are either going to pay at the pump, or pay every time they take an on-ramp/off-ramp.

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