US economy

Democrats prepare to push ahead on infrastructure in 2019

Democratic lawmakers are preparing to push ahead this year with an infrastructure proposal, one of the few areas where there is still hope for bipartisan co-operation amid the protracted stand-off over the government shutdown.

In an interview, Peter DeFazio, the incoming Democratic chair of the House of Representatives transportation and infrastructure committee, said he believed that the House would be able to deliver a significant infrastructure package by June.

The bill would probably include service transportation, harbour maintenance and improvements for US waste water and drinking water. 

Democrats are currently locking horns with Donald Trump over the president’s demands for funds to build a wall along the US-Mexico border.

Their disagreement has resulted in a partial government shutdown that has dragged into its second week.

Nevertheless, Mr Trump’s stated desire for infrastructure reform has given Mr DeFazio and others in his party hope that this could be one issue that parties are willing to reach across the aisle to support.

At the moment, Mr DeFazio said that finding bipartisan support for such proposals was a “work in progress”, but that he had been encouraged when Mr Trump told a group of senators earlier this year that he was willing to increase the federal petrol tax by 25 cents — a key stepping stone towards funding road construction and repair. The increase is higher than what many Democrats had been hoping for.

“[The president] seems to understand that we need real investment to do real projects,” Mr DeFazio said.

“We have to have an integrated national system that’s competitive in the 21st century and we don’t. We built out an amazing system in the last century. [Now] it’s falling apart and it’s congested. We’re wasting 3.1bn gallons of fuel idling in traffic now.”

His comments echo some of the same sentiments expressed by Mr Trump, who lamented in his inaugural address that the country’s infrastructure had “fallen into disrepair and decay” and suggested on the campaign trail that many of the country’s top airports belonged in a Third World country.

This convergence has led some experts to believe that there may be bipartisan support for a broader infrastructure modernisation plan, despite already tense relations between the White House and the House, which will be controlled by Democrats starting in January.

“For the first time I can recall in decades, there is really a consensus that infrastructure in the United States and infrastructure policy really needs to be addressed in a serious way,” said Richard Geddes, director of the Cornell Program in Infrastructure Policy.

“I think we have a window of opportunity to get this done,” said Ed Mortimer, vice-president of transportation and infrastructure at the US Chamber of Commerce. “I think this is the best shot we’ve had in some time.”

Of most pressing concern is the future of the Federal Highway Trust Fund, which was established in 1956 and supports road construction and mass transit. Historically, it has been funded by the country’s petrol and diesel tax, although that funding has slowed in recent years.

Mr Mortimer of the US Chamber of Commerce, which favours the fuel tax increase, noted that the federal petrol tax had not been raised since 1993 and has lost more than a third of its purchasing power in the years since.

The proliferation of electric cars and improved fuel efficiency standards for petrol-burning cars have also taken a toll on the amount of revenue collected through the federal fuel tax. Drivers now use less fuel on long distances, causing some to wonder whether the government will eventually switch from the petrol tax to a mileage-based user fee.

The Trust Fund was $16bn short of the annual funding it needed to continue supporting its current services, Mr DeFazio said. That did not include non-emergency repairs, such as fixing the more than 40,000 US bridges that were structurally deficient, he said.

While Mr Trump may have expressed a willingness to raise the fuel tax by 25 cents, he is unlikely to find support for this from many of his Republican colleagues in Congress who are likely to push back against any petrol tax or carbon tax hikes, or any measures that would raise the deficit.

Mr DeFazio, meanwhile, has written a bill that would authorise the US Treasury to issue 30-year infrastructure bonds, which would be repaid by indexing the existing petrol and diesel tax. It is unclear whether Republicans would support Mr DeFazio’s measure.

“There is a consensus that [an infrastructure bill] is necessary, but there is no consensus of how to pay for it,” said Marcia Hale, president of Building America’s Future, a bipartisan coalition that has pushed for infrastructure funding.

Nonetheless, Mr Geddes noted that there was an increasing consensus of the urgency to repair the current system, citing the example of the I-35W bridge collapse in Minneapolis in 2007, which killed more than a dozen people, as a painful example. It was just a matter of navigating the politics.

“I think we need to be realistic about the nature of the relationship between the new congress and the president,” he said. “But I hope we can rise above that and pass a bill.”


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