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Trump's Infrastructure "Plan" Is Really Just A Privatization Scam

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Dave Johnson
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"Second, as a result of the above, Trump's plan isn't really a jobs plan, either. Because the plan subsidizes investors, not projects; because it funds tax breaks, not bridges; because there's no requirement that the projects be otherwise unfunded, there is simply no guarantee that the plan will produce any net new hiring. Investors may simply shift capital from unsubsidized projects to subsidized ones and pocket the tax breaks on projects they would have funded anyway. Contractors have no obligation to hire new workers, or expand workers' hours, to collect their $85 billion."

And even if there are jobs, will they be union jobs with benefits? Or will the employees be called "contractors" who get minimum wage and no benefits, like so many other new jobs today?

"Buried inside the plan will be provisions to weaken prevailing wage protections on construction projects, undermining unions and ultimately eroding workers' earnings. Environmental rules are almost certain to be gutted in the name of accelerating projects."

What about the return on investment from that spending of taxpayer dollars? Trump is proposing "public-private partnerships." Pay attention to that word, "private" here. Politico explains, in "Trump's $1 trillion plan hits D.C. speed bumps," what that means, "In one version, the investors would get tax credits to build a project and could recoup their money by charging fees for its use, such as tolls." WE pay for the roads with tax credits, the companies get the return on that investment.

Infrastructure privatization doesn't even work. A few examples include, Fox News, 2014, Failed toll road privatization leaves Indiana in driver's seat. Or Bloomberg, 2913, Private Toll Road Investors Shift Revenue Risk to States:

"The first private road in modern years, called the Dulles Greenway, opened in 1995 in the Virginia suburbs of Washington. Initial traffic on the 14-mile Greenway was less than forecast, forcing a refinancing in 1999.

"Other privately backed roads in California, Colorado Illinois, Indiana, South Carolina, Virginia and Texas have had bankruptcies, restructurings, credit downgrades or less traffic than projected. In some cases, anticipated development near the roads didn't materialize."

What Trump's plan will do is push taxpayer dollars to profit-making "infrastructure" projects that companies are planning to do anyway. Oil pipelines, for example.

But Wait, There's More Scams

Not only does Trump's plan shuffle billions -- maybe hundreds of billions -- to corporations to pay for investment that they collect the return from, it doesn't bring about the kind of infrastructure investment the country needs right now.

The Hill's report explains:

"Critics of Trump's private financing plan, however, say that private investors would only fund projects that have tolls or user fees that can recoup investment costs.

"Therefore, critical infrastructure needs like repairing aging pipes, deepening ports or fixing existing roads and bridges without tolls may go neglected under Trump's plan.

"Public-private partnerships (PPPs) 'only work on projects that create revenues,' said Rep. Peter DeFazio (D-Ore.), ranking member on the Transportation and Infrastructure Committee. 'The vast majority of the national highway system, and our bridge problems and all our transit problems, do not generate revenues. It will not help them.'"

Learn To Look For The Con

Our country cut back on maintaining our infrastructure after the Reagan tax cuts for the rich forced cutbacks in the things government does to make our lives better. What is needed now is fixes for roads and bridges that are breaking down around the country.

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Dave has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational (more...)
 

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