President-elect Donald Trump said in his victory speech following the election on Tuesday that a major focus of his administration will be upgrading America’s ailing transportation infrastructure and creating jobs in the process. “We are going to … rebuild our highways, bridges, tunnels, airports,” he said.
“We’re going to rebuild our infrastructure, which will become, by the way, second to none,” Trump added. “And we will put millions of our people to work as we rebuild it.” But the problem is (and always has been) how do we pay for it, especially with a tax-adverse Republican congress in power.
Trump’s solution: Using other people’s money. Specifically, relying on public-private partnerships (P3s) to fix the nation’s long-neglected infrastructure.
Trump plans to encourage $1 trillion in private sector infrastructure spending via $140 billion in tax credits for the companies that invest in infrastructure construction. That’s far short of the $3.6 trillion the American Society of Civil Engineers estimates it would take to significantly raise the grade (currently a D+) of the U.S. transportation infrastructure.
The federal government ponied up $40 million and Paul Allen’s Vulcan Ventures threw in an additional $10 million in grant money. The ultimate winner, Columbus, Ohio, got pledges of $90 million from business institutions and organizations ranging from Honda to IBM, for a total of $140 million to fund smart transportation projects.
Josh Bivens, research and policy director of the Economic Policy Institute, added that investing $18 billion a year into transportation infrastructure could create more than 200,000 jobs in just the first year and a $29 billion rise in GPD. In addition, private companies may also work more efficiently and complete projects much faster than pulic agencies. And according to Arcadis’ 2016 Global Infrastructure Investment Index, the U.S. is one of the top targets for business and others looking to invest in infrastructure.
While the presidential election showed just how divided the nation is on political and ideological lines, rebuilding transportation infrastructure could help bridge this gap since every American relies on roads and they’re essential to our economy. And every politician from the local city council to the president want people and cargo to flow smoothly, lest they hear from the irate constituents and donors about traffic tie-ups and delays.
“Democrats will be broadly supportive of a major infrastructure plan,” noted Edward Alden, a senior fellow with the Council of Foreign Relations. As an indication of this, House Minority Leader Nancy Pelosi said, “We can work together to quickly pass a robust infrastructure jobs bill.”
Now Trump will just need to convince his fellow Republicans, and sell $1 trillion dollars in transportation infrastructure projects to investors before more bridges fall.
Originally published by Forbes.com