Roadblocks Facing Trump's Infrastructure Plan
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What is the main topic discussed in this episode?
This is Your Money Matters from The Wall Street Journal.
Welcome to Your Money Matters. I'm J.R. Whalen in New York.
What funding shortfall does President Trump's $1.5 trillion infrastructure plan face?
In his State of the Union address, President Trump called for $1.5 trillion in infrastructure spending.
Every federal dollar should be leveraged by partnering with state and local governments and, where appropriate, tapping into private sector investment to permanently fix the infrastructure deficit, and we can do it.
But the goal of building and expanding roads and bridges nationwide has been called into question over where the money will come from. Paul Page is the Wall Street Journal Logistic Report's deputy editor, and he joins us from our Washington bureau to discuss. So, Paul, many of the questions are stemming from Trump's proposal that the federal government kick in $200 billion toward the effort, but that could face opposition from many in Congress.
Right.
Why is the administration's $200 billion federal contribution called 'fake funding'?
$200 billion sounds like a lot of money, but we're talking about spending over anywhere from six to 10 years. And the The Trump administration calls the plan a $1.5 trillion plan, but really only $200 billion of that comes from the federal government. And that's a source of a lot of anxiety and division in Washington.
One of the people you spoke with for your story in the Wall Street Journal characterized that much federal funding as, as he put it, fake funding. What do you think he meant by that?
The $200 billion is supposed to be leveraged to get to that $1.5 trillion and to bring in money from both the private sector and state and local governments. The arguments by people such as the president of the American Trucking Associations is that that money doesn't really exist now. The formula for getting that money has never been put to the test.
Could raising the federal fuel tax realistically pay for infrastructure improvements?
So it's assumed, the administration is assuming that you get to $1.5 trillion, but there's really no guarantee. that you'll get that money. And in fact, a lot of people believe that you'll fall far short of that goal.
You know, one source of the money could be the federal fuel tax, which hasn't been raised since 1993. Based on the way the wind blows in Washington, could that be considered a viable source of funds for the infrastructure spending?
Taxes have been kind of the proverbial third rail of politics in Washington for a long time. And raising that tax is extremely difficult to do politically. People have raised it or have raised the idea of it recently, even today at their retreat in West Virginia, the Republicans talked about it. And there are some who are somewhat open to the idea, but ultimately the idea that you're going to get any significant number of Republicans, many of whom have signed pledges to not raise taxes, to sign off on a tax increase at the fuel tax level is just not really going to happen.
Why are private investors reluctant to fund rural and low‑traffic infrastructure projects?
And you also mentioned in your story that private investors are not likely to have an interest in funding really any part of this plan. Why is that?
The plan has built a great deal of it on an idea that people in the transportation industry call public-private partnerships. That is, public agencies, state agencies, the federal government take a part of a big role in a project such as a highway. And then private industry comes in and manages that and they
How might faster permitting speed up projects and why is it politically controversial?
They peel off profit in some way by user fees or tolls. Those companies, and there are a bunch of them around the world and in the United States, generally look for high volume type of business for highways that are heavily used, commuter routes outside Washington, D.C., in Ohio, outside Chicago, in some very highly populated areas of Texas. there's a lot of need by the transportation industry in a large swath of the country that does not have high volumes of traffic and is not seen as sort of generating the profits that private industry would want. Rural areas, Wyoming, Nebraska, these places which involve, which carry a lot of heavy truck traffic, which carry a lot of commerce, don't otherwise have the great volume of traffic that tollers, for instance, would be looking for.
We're speaking with Paul Page from our Washington bureau, and you are listening to your Money Matters from the Wall Street Journal.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:02–0:13
2
What funding shortfall does President Trump's $1.5 trillion infrastructure plan face?
0:13–0:59
3
Why is the administration's $200 billion federal contribution called 'fake funding'?
0:59–1:50
4
Could raising the federal fuel tax realistically pay for infrastructure improvements?
1:50–2:52
5
Why are private investors reluctant to fund rural and low‑traffic infrastructure projects?
2:52–3:22
6
How might faster permitting speed up projects and why is it politically controversial?
3:22–4:46
7
What political divisions remain over who should pay for national infrastructure upgrades?
4:46–6:52
Speakers
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