Amidst the fireworks surrounding this week’s rollout of the Trump administration’s detailed budget proposal, the president has begun to quietly lay the groundwork for what could be one of the most consequential pieces of legislation to actually garner bipartisan support on Capitol Hill. Dropped into the budget rollout with little fanfare was a blueprint for what could be the most ambitious infrastructure initiative in a generation.
Undoubtedly the past few months have been marked by bitter partisan battles on high-priority Republican policy items from the repeal of the Affordable Care Act to a broad rewrite of the tax code. Whether the president’s tax and healthcare proposals will ever make it through Congress given the intense Democratic opposition and lack of GOP consensus on these issues remains to be seen. Infrastructure, however, has the possibility of being the elusive bipartisan win. In response to the president’s promise of a $1 trillion infrastructure booster, Sen. Chuck SchumerCharles SchumerHow Trump can score a big league bipartisan win on infrastructure Overnight Finance: Dems introduce minimum wage bill | Sanders clashes with Trump budget chief | Border tax proposal at death’s door GOP senators distance themselves from House ObamaCare repeal bill MORE (D-N.Y.) recently doubled down, saying, “We Democrats have always believed in this.”
For Republicans, a new infrastructure bill would be a major achievement to unlocking private sector investment in our nation’s roads, bridges, and airports. It would also be a huge political win for the president, played out over countless ribbon cutting ceremonies across the country. For Democrats, an infrastructure package with increased spending levels would bring badly needed surface transportation dollars back to their districts and states. Both parties could play a meaningful role in passing a truly transformational piece of legislation with broad support.
With the inclusion of these key principles in the president’s budget, the White House and Transportation Secretary Elaine Chao have taken concrete steps to move the conversation forward in Washington. However, there are a number of issues that could derail this potential win-win for Democrats and Republicans. Those sticking points include labor, regulation, debt, and location. Leadership in both parties should resist the temptation to insert poison pills into the debate over the president’s proposal. Ultimately both parties and the administration will need to compromise if they want to see a truly bipartisan agreement emerge. Specifically, both ends of Pennsylvania Avenue are going to have to pull their punches when it comes to these core issues.
The Davis Bacon Act, which guarantees that workers on federal projects receive location specific “prevailing wages” is often interpreted in a fashion which not only increases project costs, but also prevents the hiring of local, underemployed labor. However, using the current infrastructure bill as an opportunity to repeal Davis Bacon will reduce bipartisanship and most likely thwart its chances for broad support.
In lieu of arguing over whether to repeal Davis Bacon, the parties should include provisions for a significant apprenticeship program that facilitates the hiring and training of additional workers. Moreover, a more accurate way of assessing the prevailing wage will go a long way towards keeping projects on budget. With the country near full employment and builders around the nation facing a shortage of qualified construction workers, this is a moment to make a true difference for those who want to work, but can’t find employment.
Democrats should in turn allow for modifications in scope and timeliness of environmental reviews. In many states, projects that merely rehabilitate existing infrastructure or even actually help the environment are slowed by often formulaic reports. Once again, the debate does not need to be all or nothing. Instead of arguing about repealing the reviews, policymakers should give states more authority to simplify and realign the impact statements to focus on projects that might have a material negative effect on the environment.
The decline of our nation’s infrastructure is like debt insofar as each passing year increases the eventual cost of restoring deteriorating assets. Washington can unlock billions in equity-like value currently lodged in many of our infrastructure projects — billions that can be reinvested into important projects. The parties accomplish this result by more broadly enabling public-private partnerships by changing tax code rules that needlessly penalize the private ownership and certain forms of management of public infrastructure.
Rural America will benefit from modernized budget scoring and expanded federal credit enhancement for important irrigation and inland waterway projects. Let local and state governments decide whether user fees should be part of the equation. These changes, which would produce hundreds of billions of dollars in value to offset a large portion, albeit not all, of the necessary additional authorized levels of direct spending for infrastructure.
For each of these principles, there’s a victory to be had on both sides of the political and geographic divide between urban and rural America. Older cities face tens of billions of dollars in Environmental Protection Agency water and wastewater mandates, transit has an extensive list of high impact projects like the Hudson River tunnels, and farmers face major flooding and irrigation challenges. The bipartisan answer needs to be regionally fair and at the same time avoid a political process in Washington that recreates earmarks under another name.
We can’t afford to pass the buck, and if we fail to head off this infrastructure crisis immediately, our failing assets will only become more unreliable and expensive to repair in the future. As the White House prepares to release its infrastructure “principles” in the next weeks, they should do so with the goal of unifying the conversation across the political spectrum and preparing America for action.
Stephen Goldsmith is the Daniel Paul Professor of of Government and Director of the Innovations in American Government Program at Harvard University. He has 25 years of experience with infrastructure finance and economic policy as a two-term mayor of Indianapolis, deputy mayor of New York City, and advisor to public entities.
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