The $1.2 trillion “infrastructure deal” is a progressive-sounding label on old-fashioned pork. It will not grow the economy; it will not be “fully paid for,” as promised; and it will not even focus on the “roads and bridges” that are always being cited as the reason for the spending.
Though the media tell us that it will be a “huge political victory” for President Joe Biden, and a boon for Democrat-aligned interest groups, it is not clear what this bill does for the country.
Start with the economic news.
A major purpose of government investment in infrastructure is to provide the means for the private sector to generate economic activity. Public roads let firms move goods to market; aqueducts provide water to farms; trains help people get to work. Infrastructure projects also create direct and indirect jobs.
An infrastructure plan that fails to generate economic growth is worse than useless, a waste of public money that could be better spent.
So when the University of Pennsylvania Penn-Wharton Budget Model declared Thursday that the infrastructure deal would “have no significant impact” on economic growth, that ought to have ended debate on the matter.
That should also warn us that the main effect of the $1.2 trillion will be to divert capital that could actually have generated growth and will instead boost inflation even as lobbyists, unions, and the politicians who passed it eventually take their cut.
The Congressional Budget Office (CBO) also panned the deal, revealing Thursday that it would add a staggering $256 billion to the federal budget deficit. President Biden promised that the deal would be “fully paid for,” assuming that Congress also passed his “corporate tax plan.”
Even if taxes are raised to cover the shortfall, Biden would be asking taxpayers to pay more for a plan that will not grow the economy — in short, simply for the sake of paying the taxes.
Biden is constantly talking about how the infrastructure deal is necessary to spur investment in the technologies of the future, like the electric vehicles he was touting on Thursday. And yet the White House chose an outdated, hopelessly fossil-fuel dependent diesel locomotive as their symbol of the deal.
That reflected Biden’s romantic attachment to the Amtrak railroad service, a perpetual...
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4 comments:
Politicians doing what they do best spending other peoples money with no benefit to the people
Manchin looks like a bag of potatoes.
People need to be contacting their senators about the things buried in this bill, e.g., the miles driven tax, etc. If it goes through, we're screwed.
In that picture is Mitt Romney and Susan Collins. That is all that is needed to know that this is a boondoggle.
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