Infrastructure Dreams and Living Nightmares

In recent weeks, there’s been a great deal of media attention on a train that derailed in Ohio. The derailment highlights a contradiction that has haunted American politics. On one hand, there is an increasingly vocal set of progressives and libertarians who have dreams of revitalizing American cities with big infrastructure projects. They want high-speed rail, fifteen minute cities, lots of cycling, walkable streets, and tall apartment buildings. These movements often rally around acronyms – YIMBY, NUMTOT, and the like. On the other hand, there is the infrastructure that actually exists in the United States. It’s crumbling, and it’s expensive to maintain, let alone replace. Between urbanist dreams and rusty realities there sits President Biden. Biden was faced with a pivotal decision. He could shore up the existing infrastructure, fighting back against the rust. He could commit America to a new paradigm, replacing what’s decaying with new ideas. He could not do both. He chose to do neither.

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The Inflation Reduction Act is Not Designed to Reduce Inflation

As the midterms approach, the Biden administration is looking to pass some part of its Build Back Better plan. Biden managed to fund $550 billion in new traditional infrastructure spending. But the American Society of Civil Engineers argues that we have an infrastructure funding gap of $2.59 trillion. The bipartisan infrastructure bill barely makes a dent in that. The rest of the administration’s proposals have continually run aground. Various senators threaten to withdraw their support all too quickly, and this has caused the administration to water down its proposals over and over again. Now there is a new version of the human infrastructure bill, called the Inflation Reduction Act. This bill claims to raise over $700 billion in new revenue in an effort to fight inflation, reduce the deficit, and fund new investments in energy. It sounds like a significant achievement, but it’s not. Here’s why.

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What it’s Like to See Bernie Sanders in 2021

On August 27th, Bernie Sanders decided to come to West Lafayette, Indiana, to do a town hall. Indiana is my home state. Bernie is 79. This could be the last time he visits, for all I know. My girlfriend is a few years younger than me. She’d never seen Bernie in person. We decided to drive down. Let me tell you the story.

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The Bipartisan Infrastructure Agreement is Embarrassing

Remember the Biden administration’s proposal to spend $2 trillion on infrastructure? Traditional infrastructure spending accounted for roughly half of that proposal. It was less than half of what the American Society of Civil Engineers believes we need. According to them, the US faces a $2.59 trillion infrastructure shortfall over the next 10 years. Now a bipartisan deal has been announced which limits new spending to just $579 billion. That’s less than a quarter of what our civil engineers believe we need. To make matters worse, the administration has agreed to fund much of the spending with public/private partnerships. Many essential infrastructure projects can’t generate a profit–they require huge up-front investments and continuous maintenance. The more an infrastructure package depends on private funding, the more limited that package is in the kinds of projects it can fund. How did it come to this? Let’s run through some of the reasons why the infrastructure plan was so completely butchered.

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On the Relationship Between Infrastructure Spending and Corporation Tax

The Biden administration has come out with a $2 trillion infrastructure plan. The United States is very behind on infrastructure spending–according to the American Society of Civil Engineers, the US faces a $2.59 trillion infrastructure shortfall over the next 10 years. Biden’s bill isn’t large enough to fill that gap, and a significant percentage of its spending is for other purposes. $400 billion is slated to go to nursing home services, a pressing need in its own right, but not one of the needs which the ASCE tracks in its reports. If you add it up, it looks like roughly half the Biden bill’s spending directly addresses the needs identified by our civil engineers, while the other half funds other projects. There’s nothing inherently wrong with this–it’s very normal for politicians to attach pet programs to popular bills that meet essential needs, and many of Biden’s pet projects have value. But it does mean that this bill’s infrastructure spending is less substantial than it initially appears. It will still leave us with a significant infrastructure shortfall. The more interesting issue–and the one I wish to discuss at some length–is the decision to pair this infrastructure bill with an increase in the marginal corporation tax rate.

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