In a speech yesterday, Democratic presidential candidate Hillary Clinton called for an additional $250 billion in federal infrastructure spending over five years, as well as $25 billion to fund a federally run infrastructure bank, saying that the proposed spending would serve as a "down payment" on the country's future.
The first thing to note about the plan is that Clinton won't say precisely how she'd pay for it. Her campaign says that she would offset the price of the new spending through some sort of business tax reform, but, rather tellingly, wouldn't provide any additional details when asked by Bloomberg Politics.
That's becoming an increasingly familiar part of Hillary Clinton's policy playbook: As I wrote last week, the candidate's plans often call for new spending, and new taxes or tax "reforms" (which, given that they are supposed to raise additional revenues would require higher taxation of someone) to pay for it. But she tends to decline to say exactly which taxes, exactly, would be raised or reformed, only that the hikes will not hit families making less than $250,000 annually. Over the course of her campaign,
Politically, this sort of tax hike hand waving is a good move, because it allows Clinton to proposed hundreds of billions in new spending while saying, essentially, that of course it will be paid for—by someone else. That vagueness, and the dodge it grants Clinton, is central to her proposal, for this sort of spending would be a much harder sell if she said that the middle class might be on the hook for the bill.
The second thing to understand about Clinton's proposed hike in infrastructure spending is that, despite Clinton's pablum about how the spending is necessary to build the country's economy, the infrastructure projects themselves are hardly pressing.
Yes, the American Society of Civil Engineers frequently gives U.S. infrastructure poor grades, and insists that more spending is necessary. But how surprising is it really that an organization of civil engineers wants more spending on civil engineering?
What these reports tend to downplay, meanwhile, is that on many measures, American infrastructure is actually getting better and safer, and that funding levels have been basically consistent over time.
As Evan Soltas noted in Bloomberg View in 2013, there was a significant reduction in the number of bridges labeled deficient (which is not the same as unsafe) between 1989 and 2009; there's been a clear decline in the number of both rural and urban roads in poor condition; and traffic congestion on urban interstates dropped from 52.6 percent in 1989 to 26.3 percent. In addition, U.S. infrastructure spending has held at broadly the same rate as a percentage of GDP over the last several decades.
In other words, there's no urgent need for a significant bump in federal infrastructure funding—much less an ongoing future commitment to higher spending in the category, as Clinton's "down payment" line implies.
Nor is it a good idea to grant the federal government increased administrative power over the nation's infrastructure. As Cato's Chris Edwards noted in a 2011 op-ed for The Washington Post, the history of federal management of major infrastructure projects is rife with cost overruns and poorly managed, poorly chosen projects.
The idea that this is merely the start of some longer-term commitment to higher spending is a big part of what's worrying about Clinton's plan. If she won't even say how she'll pay for the down payment, then how in the world does she plan to pay for whatever comes next?
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