Trump Privatizes America

[Tehon]

The $1.5 trillion infrastructure plan recently put forth will triple the costs of providing infrastructure services and price US cities and states out of the market if its implemented. "It would vastly raise the cost of living and doing business rather than making things easier for the population."

Simon Patten knew better long before Trump was born according to this Michael Hudson interview:

Trump Privatizes America

"MICHAEL HUDSON: Well, to begin with, the way that Trump’s plan is to be financed would triple the cost of what the engineers say, to $22 trillion. The reason is that it’s a Thatcherite privatization scheme. Its economic philosophy reverses the last 150 years of public infrastructure in America. In fact, it’s the biggest attack on industrial capitalism in over 100 years.

"America’s first professor of economics at the first business school – Simon Patten, at the University of Pennsylvania’s Wharton School – said that public infrastructure is a fourth factor of production.

"But it’s not like labor, land, and capital, because the role of public infrastructure is not to make a profit.

"It’s role is to provide public services that are basic for the economy’s living standards and capacity to produce, and to provide these at a subsidized rate.

"That’s how America got rich and came to dominate the world industrial economy: by publicly subsidizing its basic costs: Low-cost roads, and low-cost other infrastructure.

"The government bore these costs so that public infrastructure would subsidize the economy to lower the cost of doing business.

Well, this is somewhat more applicable today.

View attachment 176816

Recall the 2017 BS Tax Cuts for one.

Perhaps those 2017 tax cuts and Trump's plan for upgrading infrastructure are just examples of government borrowing from elites instead of taxing them?

If you wanted to add 1.5 trillion of new debt for infrastructure spending without pissing off your base by directly adding it to the debt, how would you do it?

I'm a little fuzzy on that one.
Perhaps I would start with rethinking that "balanced budget" thing?

Analysis | The Daily 202: Trump budget highlights disconnect between populist rhetoric and plutocrat reality

"Trump repeatedly promised that he would balance the budget 'very quickly.' It turns out that a guy who has often described himself as the 'king of debt' didn’t feel that passionately about deficits.

"Last year, he laid out a plan to balance the budget in 10 years.

"This year he didn’t even try.

"Trump now accepts annual deficits that will run over $1 trillion as the new normal.

"Going further, the president also promised on the campaign trail that he’d get rid of the national debt altogether by the end of his second term.

"But his White House now projects that the national debt, which is already over $20 trillion, will grow more than $2 trillion over the next two years and by at least $7 trillion over the next decade.

"The administration repeatedly denied this in December as officials pushed to cut taxes by $1.5 trillion."

And I suppose $1.5 trillion in tax cuts might soften the blow for some?

The 1.5 trillion dollar tax cut mirrors the 1.5 trillion dollar infrastructure plan. If he paid for the infrastructure plan directly he would have to add 1.5 trillion directly to the debt. That would be a big no no for his base.

But would his base care if the debt grew because of tax breaks? After all, the "people" are getting to keep their money.

He gives a tax break and repatriates offshore money that can be invested directly into his infrastructure plan.

The debt is still there but the optics are different.

 

[longknife]

Pure DTSD!

 

[whitehall]

Didn't the collapse of the Soviet empire convince quasi socialist American professors that the private sector can do it better?

 

[RoshawnMarkwees]

Private companies already bid on jobs to build roads.
This is a non-topic.

 

[Tehon]

Could Trump get a 1.5 trillion dollar infrastructure bill through congress if it would add the money directly to the debt?

 

[Tehon]

Where would the private sector come up with 1.5 trillion if not for repatriation and tax breaks? Would they pull it out of the stock market?

 

[georgephillip]

Didn't the collapse of the Soviet empire convince quasi socialist American professors that the private sector can do it better?

"Why Does Abu Dhabi Own All of Chicago's Parking Meters?"

Why Does Abu Dhabi Own All of Chicago's Parking Meters?

So, I guess you're clear on how adding the profit motive to public infrastructure lowers the cost of doing business and living?

 

[georgephillip]

Where would the private sector come up with 1.5 trillion if not for repatriation and tax breaks? Would they pull it out of the stock market?

Robert Reich floated this possibility:

Why We Should Raise Taxes on the Super-Rich and Lower Them on the Middle Class

"My proposal to raise the marginal tax to 70 percent on incomes over $15 million, to 60 percent on incomes between $5 million and $15 million, and to 50 percent on incomes between $500,000 and $5 million, has generated considerable debate."

Another source I'm unable to locate at the moment made the claim tax rates could be dropped on all earners below the richest 1%; rates would stay the same for 1% earners, and rates would rise precipitously for all earners above the 0.1% level.

 

[georgephillip]

Private companies already bid on jobs to build roads.
This is a non-topic.

Private companies bid on jobs to build roads, bridges, and water treatment plants that are operated as public utilities and not private for-profit monopolies. Trump's plan will change that is ways designed to raise the cost of living for all but the richest Americans.

 

[RoshawnMarkwees]

Private companies already bid on jobs to build roads.
This is a non-topic.

Private companies bid on jobs to build roads, bridges, and water treatment plants that are operated as public utilities and not private for-profit monopolies. Trump's plan will change that is ways designed to raise the cost of living for all but the richest Americans.

Says who?

 

[georgephillip]

Private companies already bid on jobs to build roads.
This is a non-topic.

Private companies bid on jobs to build roads, bridges, and water treatment plants that are operated as public utilities and not private for-profit monopolies. Trump's plan will change that is ways designed to raise the cost of living for all but the richest Americans.

Says who?

Anyone who recognizes how private monopolies distort free markets should expect Trump's infrastructure plan is largely a gift to his donors. How else would you explain the mechanism by which $200 billion is expected to leverage close to 6:1 from private partners unless the $200 billion is used to protect the downsides of private sector bets? It's an old refrain: privatize profit and socialize risk.

 

[RoshawnMarkwees]

Private companies already bid on jobs to build roads.
This is a non-topic.

Private companies bid on jobs to build roads, bridges, and water treatment plants that are operated as public utilities and not private for-profit monopolies. Trump's plan will change that is ways designed to raise the cost of living for all but the richest Americans.

Says who?

Anyone who recognizes how private monopolies distort free markets should expect Trump's infrastructure plan is largely a gift to his donors. How else would you explain the mechanism by which $200 billion is expected to leverage close to 6:1 from private partners unless the $200 billion is used to protect the downsides of private sector bets? It's an old refrain: privatize profit and socialize risk.

That’s your opinion. What I see happening is a reduction in regulatory red tape. So the bidding process remains and the only monopoly that is involved is government and they are actually cut out of the loop to an extent.

 

[georgephillip]

That’s your opinion. What I see happening is a reduction in regulatory red tape. So the bidding process remains and the only monopoly that is involved is government and they are actually cut out of the loop to an extent.

Where's the spending for Trump's infrastructure plan coming from?

Missing From Trump's $1.5 Trillion Infrastructure Plan: $1.3 Trillion

"All told, only $200 billion in federal spending is called for, with the remaining $1.3 trillion to be generated by state and local governments, as well as private investors.

"And when the likely source of federal funds is accounted for, it’s not really spending at all.

"According to a White House official who briefed reporters on the plan over the weekend, the money would come from cuts to TIGER and New Starts, USDOT grant programs popular on both sides of the political aisle.

"Trump calls to slash their funding in the 2019 budget request. Congress rejected his similar request last year."