B12 Solipsism

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Bill Clinton: Infrastructure Bank and BUILD Act

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Halfway To Discontent
Halfway To Discontent

Charles Pierce and Mark Warren interview Bill Clinton, well worth a read. I had many disagreements with President Clinton, but I admire his political savvy and intelligence.

I like this idea:

ESQUIRE: Where’s the demand from outside, though? Where are the people insisting, “Hey, my bridge is falling down, and ‘We can’t afford to fix it’ is not a good enough answer for me. And if you can’t come up with a better one, then you’re back in the private sector”?

CLINTON: One of the things that I think should be done is the infrastructure bill that Kay Bailey Hutchison and John Kerry proposed, which sets up an infrastructure bank which would be seeded with U. S. taxpayers’ money, but it would be open to investors. Like, you and I could buy a $1,000 infrastructure bond, or the Chinese sovereign wealth fund, Saudi sovereign wealth fund, anybody could invest in it, and the returns on infrastructure are significant enough that in an uncertain stock market, I think you could get a lot of private capital.

And then it would be really interesting, it’d be a great opportunity — all this dispute about the one tenth of 1 percent of America that Paul Krugman’s always talking about. I believe that people of my income group should pay more, and I explained why, but that won’t necessarily lift overall wage levels. To do that, you’ve gotta have more jobs, a tighter labor market, different job mix. This is one way that wealthy Americans could really contribute. They could put hundreds of millions of dollars into the infrastructure bank, be a good investment for them, for their children, for their grandchildren, and they would directly contribute to revitalizing a big sector of middle-class wages in America and making our country more productive, so that we could create more opportunity. But I think that we could get a lot of grassroots support from, like, local chambers of commerce and other things if they understood exactly how this infrastructure bank would work. I hope that the president will make more of this, and I wouldn’t be as sure as everyone is now that nothing will be done next year. If we get this done, then I think he ought to challenge them to make a deal on corporate taxes and establishing the infrastructure bank that can take private capital, and you can make some slice of that deal repatriating a bunch of that money that’s overseas now at a lower tax rate, and put that money directly in the infrastructure bank. That’s the federal government’s contribution, and then open it up for other investment. And I think, you know, you might have $100 billion by the time you get done — that could put people to work right away.

(click here to continue reading Print – Bill Clinton: Someone We Can All Agree On – Esquire.)

Is this privatization? or just investment. If it is the latter, I’m for it. Our national infrastructure is crumbling, and the Republicans, for the most part, seem to be pleased about this. Repairing bridges, water mains and the like is also an employment boon – you can’t outsource that kind of work so easily.

Decline and Fall of Empire
Decline and Fall of Empire

I had never heard of this concept, turns out Senators John Kerry and Kay Bailey Hutchison proposed it back in March 2011, but I guess it went nowhere.

Tuesday, March 15, 2011 WASHINGTON, D.C. – At a press conference today, Senators John Kerry (D-Mass.), Chairman of the Foreign Relations Committee, Kay Bailey Hutchison (R-Texas), Ranking Member of the Commerce, Science, and Transportation Committee, and Mark R. Warner (D-Va.), Member of the Banking, Housing and Urban Affairs Committee, announced legislation to create an infrastructure bank that would help close America’s widening infrastructure funding gap, create millions of American jobs in the next decade, and make the United States more competitive in the 21st century.

U.S. Chamber of Commerce President and CEO Thomas J. Donohue and AFL-CIO President Richard Trumka, who also attended the event, underscored the unique coalition of business and labor uniting around this initiative.

“This is a bi-partisan moment to make a once bi-partisan issue bi-partisan once again,” said Sen. Kerry.  “Democrats and Republicans, business and labor, are now united to create an American infrastructure bank to leverage private investment, make America the world’s builders once again, and close the deficit in our infrastructure investments.  The BUILD Act will create good jobs, strengthen our competitiveness, and do more with less.  Most of all, this bill breaks a partisan stalemate to get America back in the game.  When you’ve got a Massachusetts Democrat, a Texas Republican, the Chamber of Commerce and the AFL-CIO preaching from the same hymnal, you’ll find a sweet spot that can translate into a major legislative step forward.”

“I have been working to overhaul our nation’s aging infrastructure for nearly 20 years. This national infrastructure bank is an innovative way to leverage private-public partnerships and maximize private funding to address our water, transportation, and energy infrastructure needs. It is essential to think outside the box as we work to solve national challenges, particularly in this fiscal crisis. We must be creative to meet the needs of our country and to spur economic development and job growth while protecting taxpayers from new federal spending as much as possible,” said Sen. Hutchison, who served on the Commission to Promote Investment in America’s Infrastructure in 1993 as State Treasurer of Texas and is the Ranking Member on the Senate Commerce, Science, and Transportation Committee.

“The United States is spending less than two-percent of its GDP on infrastructure, while India spends five-percent and China spends nine-percent,” said Sen. Warner. “As a matter of global competitiveness, we need to find additional ways to upgrade our nation’s infrastructure, and this bank will help us strike the right balance between near-term discipline and investment in future growth.”

“A national infrastructure bank is a great place to start securing the funding we need to increase our mobility, create jobs, and enhance our global competitiveness,” said Donohue. “With a modest initial investment of $10 billion, a national infrastructure bank could leverage up to $600 billion in private investments to repair, modernize, and expand our ailing infrastructure system. While private capital is badly needed, we must also recognize our public financing mechanism is broken. Receipts to the Highway Trust Fund have fallen dramatically, funds are being diverted to non-infrastructure projects, and the gas tax has not been increased in 17 years. We need a multiyear highway bill to meet immediate needs, but we have to figure out a way to ensure we have adequate public investments for years to come.”

The Building and Upgrading Infrastructure for Long-Term Development (BUILD) Act would establish an American Infrastructure Financing Authority (AIFA) – a kind of infrastructure bank – to complement our existing infrastructure funding.  This institution, which would provide loans and loan guarantees, would be both fiscally responsible and robust enough to address America’s needs.

 

AIFA is independent of the political process.  It would fund the most important and most economically viable projects across the country, our states, and our communities.

AIFA is also fiscally responsible.  While AIFA will receive initial funding from the government, after that it must become self-sustaining.

Finally, AIFA relies on the private sector.  It can never provide more than 50 percent of a project’s costs, and in many cases would provide much less, just enough to bring in private investment.

(click here to continue reading John Kerry – United States Senator for Massachusetts: Press Room.)

Division Street Bridge
Division Street Bridge

More:

Earlier this year, Sen. John Kerry introduced the BUILD Act as new legislation to tackle the problems of jobs, economic growth and our declining infrastructure simultaneously. The centerpiece of the legislation calls for the creation of an American Infrastructure Financing Authority, or what is coming to be known as an “infrastructure bank.” This essay will touch on the fundamentals of the bill and the problem it attempts to solve, explain ways it could be improved, argue that it is a good idea, and advocate political support for it. The BUILD Act creates a financial institution modeled after the Export-Import Bank, which was created by FDR during the Great Depression. The bill would require a small amount of start-up capital financed by the federal government, but it would conduct its business as an independent agency. A CEO and a seven-member board of directors would be appointed by the president and confirmed by the Senate. Although the initial start-up capital ($10B) would be provided by the federal government, the bank would be required to become self-sufficient in five years.

(click here to continue reading Daily Kos: Building on the BUILD Act.)

So, we’ll see. Apparently John Boehner’s House minions don’t like the idea of country first over party victory, so have refused to move the bill forward.

Written by Seth Anderson

January 22nd, 2012 at 9:45 am

Posted in Business,government

Tagged with ,

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