We now have a good test case.
But now he’s unleashing his inner Obama, having reached a tentative deal with Chuck Schumer and Nancy Pelosi for a $2 trillion infrastructure blowout.
Notwithstanding the GOP’s supposed belief in the Constitution and limits on the role of the federal government, there are plenty of Republicans on Capitol Hill (especially on the committees that will get to direct this money to various campaign contributors) who will gladly join this spending orgy.
The relevant question, though, is whether there are some good GOPers to stop this boondoggle.
The Washington Post reports that there are some holdouts:
“A $2 trillion infrastructure deal outlined this week by President Trump and top Democrats is already losing momentum, as the president’s own chief of staff is telling people inside and outside the administration that the effort is too expensive … Democratic leaders in Congress … said they were pleasantly surprised by the president’s willingness to back a large-scale spending effort. … But the initiative has run into immediate opposition from Republicans who balk at the hefty price tag and from conservative allies who are pushing lawmakers to block it. … Earlier in the administration, Trump praised Sen. Elizabeth Warren (D-Mass.) — a potential 2020 foe — for her ideas because, in his view, she was determined to spend more than Republicans. He would tell aides to get a list of projects and ‘let’s just spend it,’ in the words of one former administration official. … Trump always wanted to spend more. … raising fuel tax rates by 35 cents and pegging them to rise with inflation would generate only about a quarter of the necessary revenue over 10 years. … Getting the remaining $1.5 trillion would involve much more significant tax increases … But even fully reversing the corporate income tax cut, which dropped the rate from 35 percent to 21 percent, would not close the gap.”
One obvious takeaway from this article is that taxes eventually will increase if Republicans don’t get serious about spending restraint.
Indeed, I’ve already warned that Trump’s profligacy is making tax increases more likely.
And another takeaway is that a blank-check approach would violate my rules for sensible infrastructure policy.
The editors at National Review share my concern about the plan for a bipartisan budget-busting package.
“Some time ago, President Trump’s team produced a $1.5 trillion infrastructure plan, which was really a $200 billion infrastructure plan with some wishful thinking attached. … now the president has joined force[s] with Nancy Pelosi and Chuck Schumer on something new: a $2 trillion infrastructure plan, which also is composed mainly of wishful thinking. … What could possibly go wrong? You can tell this is backward by the fact that the triumvirate has settled on a price tag — an incomprehensibly large one — but is remarkably fuzzy on what’s to be bought with that $2 trillion. … We have been here before, with Barack Obama and his ‘shovel-ready’ projects. The lesson of Obama’s failed stimulus bill — which was in considerable part an infrastructure program — is that doing things backwards does not work. … figuring out how to pay for this is at the bottom of the current agenda. … This is not a sane way to proceed. … The infrastructure scheme deserves to die an early and unlamented legislative death.”
It should just “die an early an unlamented legislative death.” It never should have been born in the first place.
I’m not surprised that Trump is supporting a pork-filled budget plan for infrastructure. As I warned back before the 2016 election, he’s a big-government Republican.
What’s not clear, though, is how many GOP lawmakers will support his Greek-style approach to the transportation budget.
I’ve updated a previous set of images to highlight the problem.
P.S. The correct infrastructure policy for Washington is to have no infrastructure policy. That’s because transportation should be handled by state and local government – or, even better, the private sector. In my fantasy world, we’d shut down the Department of Transportation and repeal the federal gas tax.
Daniel J. Mitchell is a top expert on tax reform and supply-side tax policy and is Chairman of the Center for Freedom and Prosperity. Mitchell is a strong advocate of a flat tax and international tax competition.