The Gazette: Disruptive infrastructure plan picks up steam
Author: The Gazette Editorial Board - June 23, 2018 - Updated: June 23, 2018
Readers heard it here first, in a Gazette editorial about selling government loans to fund a major infrastructure plan.
By selling federal student loans, farm loans, and other paper assets, the government could raise a trillion dollars or more. It could fund history’s largest employment program.
Since our March 17 editorial, which also ran in The Washington Examiner, others have joined the chorus.
The Hill weighed in June 19 with an article titled “Selling government assets would be a responsible move in infrastructure deal.”
“A new plan is gaining traction among Democrats and Republicans that would fund infrastructure projects while cutting into the national debt,” states The Hill, explaining how the sale of assets could fund projects without running up the “credit card.”
“Selling public assets can be a fiscally responsible solution especially in the context of a comprehensive infrastructure package,” the article concludes. “Lawmakers should use all the tools at their disposal to ensure there is a balance between taxpayer interests and an infrastructure system that promotes economic growth and efficiency.
The Bond Buyer published two recent and positive articles about the idea.
Bloomberg Politics highlighted the concept July 21, explaining how financial advisers Larry Kidwell and Robbi Jones — first featured in our editorial — began promoting the idea just weeks after the election of President Donald Trump.
Kidwell and Jones visualize a massive sale of up to $4.8 trillion in government loans, at a discount. Borrowers would get first dibs on paying off debts, before government offers them to private-sector lenders and asset managers.
Toward their goal, a bipartisan group of legislators introduced a bill June 14 called The Generating American Income and Infrastructure Act, or “GAIIN.”
“The bill, considered to be a possible pilot program according to one GOP strategist, would require the Department of Agriculture to sell distressed assets on the open market and then have the Treasury Department distribute those proceeds to communities below the poverty line to create infrastructure projects,” explains The Washington Times.
It is hard to argue with legislation that reduces government debt, funds infrastructure, creates jobs, and infuses capital into some of the country’s poorest communities. That probably explains why the pilot bill has support of the conservative Freedom Caucus and the liberal-leaning Congressional Black Caucus.
The big-picture plan, of selling nearly $5 trillion in loans, has support of the conservative National Taxpayers Union.
Liberals can support this idea because it funds good jobs and better infrastructure. Conservatives can love it for all those reasons, and the fact it shrinks the size and scope of federal government. Maybe Washington bureaucrats should not sit on loan assets they can sell for the immediate benefit of taxpayers — people who keep hearing how government can’t afford to fix dangerous physical liabilities.
We no longer can treat major, nationwide infrastructure work as a wish-list item. The American Society of Civil Engineers latest “Failure to Act” report finds each American household will lose an average of $3,400 to infrastructure deficiencies before 2025. Some of these problems will kill people. The report identifies critical problems with airports, bridges, water systems, the electrical grid, ports, roads, wasterwater systems and more.
“Poor infrastructure affects business productivity as well as every sector and region of the U.S. because when one part of the infrastructure system fails, the impact can spread throughout the system and economy,” explains the report.
As the fall elections near, candidates seem at a loss for positive economic messaging. They should think far outside the beltway, looking for big ideas that promise immediate improvements to American lives.
They should consider this disruptive new plan for good jobs, infrastructure improvements, and no new taxes or debt. Get the people’s money out of Washington bureaucracies and into projects all Americans need.