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new infrastructure plan
https://www.reuters.com/article/us-usa-t...SKBN1F71BC

Still in flux, but new $200 billion infrastructure plan under "construction." Serious discussion of increase in gas tax, which I think is a good idea. But somehow I doubt the House will pass that.
01-20-2018 11:50 AM
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RE: new infrastructure plan
If this is the plan, I like that the bill is encouraging local/state governments and private companies to get involved. That being said, it doesn't change the fact that the feds should not be responsible for local pet projects, it'd add to the debt if no funding mechanisms are put in place, and creating a ten-year plan doesn't fix the core problem of inadequate maintenance funding. Residents of Wichita shouldn't be forced to pay for Manhattan subway repairs when NYC and NY state can't get their s*** together and will probably underfund the system to where they're in another state of crisis in twenty years. Instead I'd take the following approach:

1. Redirect the current highway fund towards actual highways. If I'm not mistaken the annual construction/maintenance budget is about $50B, but 20 of it is spent on stuff like light rail and bike trails. That's not what it's designed to do, shift it back so we can properly fund interstate maintenance for starters.
2. Create a system of national toll roads. People tend to suck up tolls and pay them instead of using side roads and highways so it'd raise a good chunk of cash, but enough people would avoid them if structured properly to avoid the exponential nature of gridlock and help ease traffic conditions.
2A. Dedicate 40% of the toll money to the highway fund annually, block grant 50% to states based on some simple formula based on population and economic size for them to spend on whatever they want, and for the first five years allocate the final 10% towards immediate repairs for pressing infrastructure safety issues (e.g. Flint pipes), after which point these funds are absorbed by the block grant section.
3. Deregulate private investment in infrastructure spending and expand the loan program to $25B like the article states. If they have the money and are willing to pay for improvements, make it easy for them to do so.
01-20-2018 02:09 PM
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Post: #3
RE: new infrastructure plan
(01-20-2018 02:09 PM)Love and Honor Wrote:  If this is the plan, I like that the bill is encouraging local/state governments and private companies to get involved. That being said, it doesn't change the fact that the feds should not be responsible for local pet projects, it'd add to the debt if no funding mechanisms are put in place, and creating a ten-year plan doesn't fix the core problem of inadequate maintenance funding. Residents of Wichita shouldn't be forced to pay for Manhattan subway repairs when NYC and NY state can't get their s*** together and will probably underfund the system to where they're in another state of crisis in twenty years. Instead I'd take the following approach:

1. Redirect the current highway fund towards actual highways. If I'm not mistaken the annual construction/maintenance budget is about $50B, but 20 of it is spent on stuff like light rail and bike trails. That's not what it's designed to do, shift it back so we can properly fund interstate maintenance for starters.
2. Create a system of national toll roads. People tend to suck up tolls and pay them instead of using side roads and highways so it'd raise a good chunk of cash, but enough people would avoid them if structured properly to avoid the exponential nature of gridlock and help ease traffic conditions.
2A. Dedicate 40% of the toll money to the highway fund annually, block grant 50% to states based on some simple formula based on population and economic size for them to spend on whatever they want, and for the first five years allocate the final 10% towards immediate repairs for pressing infrastructure safety issues (e.g. Flint pipes), after which point these funds are absorbed by the block grant section.
3. Deregulate private investment in infrastructure spending and expand the loan program to $25B like the article states. If they have the money and are willing to pay for improvements, make it easy for them to do so.

I'm not a fan of the public/private deals. Infrastructure by nature is a public good.

I really get the willies over using the right of eminent domain to acquire property that is then turned into a private enterprise money maker. It's one thing to take (and compensate) Farmer Jones for 20 acres to do something for the general public and an entirely different thing to do that to let XYZ Corp make money.

"Private" deals almost always require either the government loaning money to the private enterprise at government bond rates or permitting the company to issue bonds that are backed by the government to get better interest rates and places the public at risk of having to pay the bonds in default.
They also don't have a great track record of doing construction up to standards.
https://usa.streetsblog.org/2016/10/18/p...goes-bust/

It appears that many private toll firms have been scams. They get government on hook for some of the debt, create sky high projections of traffic to get investors. Traffic doesn't meet the projections, they go bankrupt the government gets stuck with the debt and finishing the project or it gets sold in bankruptcy at a big discount.
https://www.nakedcapitalism.com/2017/08/...-bust.html
01-20-2018 09:54 PM
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Post: #4
RE: new infrastructure plan
(01-20-2018 09:54 PM)arkstfan Wrote:  I'm not a fan of the public/private deals. Infrastructure by nature is a public good.
I really get the willies over using the right of eminent domain to acquire property that is then turned into a private enterprise money maker. It's one thing to take (and compensate) Farmer Jones for 20 acres to do something for the general public and an entirely different thing to do that to let XYZ Corp make money.
"Private" deals almost always require either the government loaning money to the private enterprise at government bond rates or permitting the company to issue bonds that are backed by the government to get better interest rates and places the public at risk of having to pay the bonds in default.
They also don't have a great track record of doing construction up to standards.
https://usa.streetsblog.org/2016/10/18/p...goes-bust/
It appears that many private toll firms have been scams. They get government on hook for some of the debt, create sky high projections of traffic to get investors. Traffic doesn't meet the projections, they go bankrupt the government gets stuck with the debt and finishing the project or it gets sold in bankruptcy at a big discount.
https://www.nakedcapitalism.com/2017/08/...-bust.html

Most of ours in Texas seem to have gone pretty well. Was on 130 today and it seemed pretty busy. Hadn't heard about the stuff in the article.
(This post was last modified: 01-20-2018 10:16 PM by Owl 69/70/75.)
01-20-2018 10:13 PM
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RE: new infrastructure plan
Arkansas did a study on tolls and only came up with a couple miles that would be profitable.
One of these outfits came in wanting to build the I-49 corridor in Arkansas as a toll. This is a very expensive corridor to build. To get I-540 (which runs parallel for about 75 miles) the Feds had to do 95-5 funding because Arkansas flat couldn't swing the cost of the tunnels, bridges and excavation required to build in the Ozarks.

Governor and Attorney General looked it over and it was pretty obvious they planned to get the state on the hook for a lot of the debt. They had one subsidiary that would do briding and another would excavation and another the paving and another would own and operate and own the debt. It was a sucker deal and the operating subsidiary was going to file bankruptcy to get out from under the debt and if they were so inclined another related company probably would come in and bid on the operating rights in bankruptcy.

Like what I learned about lignite gasification. There is a company that was getting press about it when oil was so high. I talked to a mining regulator about it because Arkansas has a lot of lignite. He said the article I read had left out that the company doing it had bought the plant out of bankruptcy for a nickel on the dollar. He said if you figure out how to make a billion-dollar plant for $50 million you'll have it made.
01-21-2018 11:05 AM
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RE: new infrastructure plan
The bottom line is that few big infrastructure projects are priced to include all benefits. Toll roads may not pay for themselves, just like high speed trains. But we need them. I would privatize the interstate highway system as National toll roads, and let them generate their own funds for expansion and maintenance.
01-21-2018 01:47 PM
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RE: new infrastructure plan
(01-21-2018 01:47 PM)Owl 69/70/75 Wrote:  The bottom line is that few big infrastructure projects are priced to include all benefits. Toll roads may not pay for themselves, just like high speed trains. But we need them. I would privatize the interstate highway system as National toll roads, and let them generate their own funds for expansion and maintenance.

There is however a benefit to just shouldering the cost rather than trying to make things pay for themselves.

It permits the extension of infrastructure into less profitable areas (see rural electrification, rural highways).

It keeps costs down thus lower entry barriers to innovation. Cheap mail back when it was fully a government agency gave us catalog sales and the rise of Sears & Roebuck. The interstate highway system created essentially a new form of trucking industry. Instead of being limited to short hauls from ship/train depot/warehouse to final destination, it gave rise to long haul trucking. Subsidizing the infrastructure of airports and air traffic control gave us companies like FedEx and made air travel adoption faster.

Shouldering much of internet infrastructure costs gave us online retailers and communication sites such as this.

Non-market rate extraction fees made it cheaper to extract minerals in the west and to graze cattle.

Each of these fueled the economy.
01-22-2018 10:56 AM
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RE: new infrastructure plan
(01-22-2018 10:56 AM)arkstfan Wrote:  
(01-21-2018 01:47 PM)Owl 69/70/75 Wrote:  The bottom line is that few big infrastructure projects are priced to include all benefits. Toll roads may not pay for themselves, just like high speed trains. But we need them. I would privatize the interstate highway system as National toll roads, and let them generate their own funds for expansion and maintenance.
There is however a benefit to just shouldering the cost rather than trying to make things pay for themselves.
It permits the extension of infrastructure into less profitable areas (see rural electrification, rural highways).
It keeps costs down thus lower entry barriers to innovation. Cheap mail back when it was fully a government agency gave us catalog sales and the rise of Sears & Roebuck. The interstate highway system created essentially a new form of trucking industry. Instead of being limited to short hauls from ship/train depot/warehouse to final destination, it gave rise to long haul trucking. Subsidizing the infrastructure of airports and air traffic control gave us companies like FedEx and made air travel adoption faster.
Shouldering much of internet infrastructure costs gave us online retailers and communication sites such as this.
Non-market rate extraction fees made it cheaper to extract minerals in the west and to graze cattle.
Each of these fueled the economy.

Agree. So we contribute up front to make it happen in less profitable areas, and let demand drive expansion in more profitable areas.
01-22-2018 11:08 AM
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RE: new infrastructure plan
I'm not in favor of toll roads. We already paid for it once, why should we have to do it again?

I wonder who makes these decisions. I540 is going to be a loop around Raleigh. Right now 1 section goes E/SE, the other goes W/SW and they converge on I40 between Raleigh and Durham. 90% of the traffic comes from E/SE but they made the W/SW portion a toll road. DOT says, "We expected people would be slow to adopt the toll road." They won't release the numbers which tells me it isn't working.

Meanwhile they put those $&%^$ metering lights on the E/SE leg which has doubled my travel time.
01-22-2018 01:35 PM
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RE: new infrastructure plan
I am a big supporter of infrastructure projects as part of gov't policy. Obama's presidency would have been seen more favorably by all if he would have focused much more efforts on developing and delivering on huge infrastructure projects as stimulus instead of bailing out municipal gov'ts and working on healthcare.

IMHO, the building of the interstate system was probably the greatest accomplishment of the 20th century for economic benefit. Without it, the mobility we gained from the invention of the car and truck would be not nearly as great. The commerce gains from transportation was huge. To this day, we are still benefiting greatly.
01-23-2018 10:14 AM
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RE: new infrastructure plan
(01-23-2018 10:14 AM)miko33 Wrote:  I am a big supporter of infrastructure projects as part of gov't policy. Obama's presidency would have been seen more favorably by all if he would have focused much more efforts on developing and delivering on huge infrastructure projects as stimulus instead of bailing out municipal gov'ts and working on healthcare.

IMHO, the building of the interstate system was probably the greatest accomplishment of the 20th century for economic benefit. Without it, the mobility we gained from the invention of the car and truck would be not nearly as great. The commerce gains from transportation was huge. To this day, we are still benefiting greatly.

Whether people like them or not, Walmart's success in large part is related to the interstate system. Amazon wouldn't be viable but for the transportation infrastructure.

While I'm not one of those who buys the idea that health insurance is an unenumerated 9th Amendment right, I do think we should look at it as an infrastructure issue.

Health costs inflate the cost of property and casualty insurance, workers comp, malpractice (since part of the claim is for corrective treatment), as well as inflating labor costs.
01-23-2018 10:53 AM
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RE: new infrastructure plan
(01-23-2018 10:53 AM)arkstfan Wrote:  
(01-23-2018 10:14 AM)miko33 Wrote:  I am a big supporter of infrastructure projects as part of gov't policy. Obama's presidency would have been seen more favorably by all if he would have focused much more efforts on developing and delivering on huge infrastructure projects as stimulus instead of bailing out municipal gov'ts and working on healthcare.

IMHO, the building of the interstate system was probably the greatest accomplishment of the 20th century for economic benefit. Without it, the mobility we gained from the invention of the car and truck would be not nearly as great. The commerce gains from transportation was huge. To this day, we are still benefiting greatly.

Whether people like them or not, Walmart's success in large part is related to the interstate system. Amazon wouldn't be viable but for the transportation infrastructure.

While I'm not one of those who buys the idea that health insurance is an unenumerated 9th Amendment right, I do think we should look at it as an infrastructure issue.

Health costs inflate the cost of property and casualty insurance, workers comp, malpractice (since part of the claim is for corrective treatment), as well as inflating labor costs.

You are making the same mistake as Obama.
Health insurance and health costs are two different things. Only one is a significant problem for everyone.
01-23-2018 03:45 PM
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RE: new infrastructure plan
(01-23-2018 10:53 AM)arkstfan Wrote:  
(01-23-2018 10:14 AM)miko33 Wrote:  I am a big supporter of infrastructure projects as part of gov't policy. Obama's presidency would have been seen more favorably by all if he would have focused much more efforts on developing and delivering on huge infrastructure projects as stimulus instead of bailing out municipal gov'ts and working on healthcare.

IMHO, the building of the interstate system was probably the greatest accomplishment of the 20th century for economic benefit. Without it, the mobility we gained from the invention of the car and truck would be not nearly as great. The commerce gains from transportation was huge. To this day, we are still benefiting greatly.

Whether people like them or not, Walmart's success in large part is related to the interstate system. Amazon wouldn't be viable but for the transportation infrastructure.

While I'm not one of those who buys the idea that health insurance is an unenumerated 9th Amendment right, I do think we should look at it as an infrastructure issue.

Health costs inflate the cost of property and casualty insurance, workers comp, malpractice (since part of the claim is for corrective treatment), as well as inflating labor costs.

I fail to see how health insurance can be equated to an infrastructure project. If you're going for an analogy, the interstate highway system is more like people than health insurance. The interstates allow for the creation of wealth thru commerce. People allow for the creation of wealth thru labor and innovation. Healthcare insurance is more like a contract bid to maintain the interstates. Actual healthcare is like the maintenance departments maintaining the interstate systems.

Healthcare and road maintenance does not create wealth in an economic sense. Both activities are designed to preserve what already exists primarily, and in some cases provide incremental improvements. Road maintenance is an operational necessity though. If you want to argue that healthcare should be viewed as an operational necessity, then a compelling case could be made.
01-24-2018 08:13 AM
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Post: #14
RE: new infrastructure plan
Health care is a redistribution of capital.

I think it serves a better purpose to keep more of that capital in the hands of business owners and individual consumers.

No one can seriously argue that reducing health expenditures to something closer to the norm for industrialized nations would not:
1. Reduce operating costs for business.
2. Reduce the cost of workers compensation premiums
3. Reduce the cost of property and casualty insurance
4. Reduce the cost of medical practice insurance.

I think it is a valid choice to say that a business should retain more of its capital for purposes that benefit the owners and I think it is an equally valid choice to say individuals should retain more of their income to direct into the economy as they see fit. That is the entire justification of tax cuts.

Now I am not a true single payer plan advocate. Personally I support the model adopted by Singapore. There you are mandated to deposit a percentage of your income into a health savings plan. Most of your medical expenses you pay be debiting the HSA. There is no insurance except a national catastrophic health plan that most people don't tap into except near end of life. That catastrophic plan also serves as a cap on how much liability you can have for medical costs for an injured worker or as the result of an auto accident.

When you die, once your bills are paid, your health savings plan passes to you heirs as unrestricted inheritance.

That ain't what were are going to get. We will likely get something ****** and convoluted and it is going to happen, simply a matter of time.

Best you can hope for it not being something like that is going to be "public option" where people under 65 can pay premiums to buy into Medicare with no subsidy.

During ACA a group of Republicans told Democrats if public option was taken out they would support ACA. They lied. If public option had happened, you would have seen a big drop in costs because the premiums would have been lower and many employers would have just put their people in Medicare to retain more of their capital.
01-24-2018 04:24 PM
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RE: new infrastructure plan
One incentive I might like to see on an infrastructure plan would be a direct match of a state's increase in a gas tax. If the feds raise the gas tax, send up to 5 cents back to the states to match a 5 cent increase in the state tax. You don't go through the appropriations process. If Indiana raises its gas tax 5 cents then the feds send 5 cents of the federal increase straight to Indiana. If Ohio raises theirs 4 cents, send 4 cents straight to Ohio. If New York raises theirs 10 cents, send 5 cents straight to New York.

There's a lot of political disincentive not to pay for infrastructure. This would be a carrot for the states who wanted to raise money. There are vast unmet needs.
01-24-2018 09:47 PM
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RE: new infrastructure plan
Since the 1993 tax increase to 18.4 cents, the CPI has increased from 142 to 245. Construction costs have gone up at an even higher rate and gas efficiency of cars has also increased, tending to reduce the tax collected. Increasing the rate to match the CPI would increase it to 32 cents a gallon.

That would be a reasonable increase. It would allow the federal government to meet more needs. But with fuel efficiency and a construction cost inflation higher than CPI, it would mean the federal government would still be doing less than 1993. I think the states do need to pick up more of the burden and get rid of the idea of "free" money that dominates a lot of spending decisions, but the federal government still has a role. It just shouldn't do so much it crowds out the states ability to tax.
01-24-2018 09:53 PM
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RE: new infrastructure plan
I think a gas tax hike is probably needed as well.

What I would like to see is something to reverse the mega-hub practice in the passenger airline industry. I have absolutely no idea how to accomplish that from a regulatory standpoint. However, we are becoming weaker as a nation and economy due to this practice.

Decades ago we had many more airline hubs. This gave us bigger, better equipped airports at many more locations around the country. As we stand now, the bulk of the industries technical and mechanical expertise is being concentrated into fewer and fewer locations. This is bad for growth and bad for the dissemination of technical capacity across the country.

From a national defense standpoint, we are now at the point where striking ten or fewer selected airports could effectively shutdown passenger air travel across the country.

I'd like to see municipal airports roar back to life and flying become tolerable again.

Trump was right, some of us Americans are dreamers. I dream of comfortable direct flights.
01-31-2018 11:57 AM
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RE: new infrastructure plan
(01-31-2018 11:57 AM)Claw Wrote:  I think a gas tax hike is probably needed as well.

What I would like to see is something to reverse the mega-hub practice in the passenger airline industry. I have absolutely no idea how to accomplish that from a regulatory standpoint. However, we are becoming weaker as a nation and economy due to this practice.

Decades ago we had many more airline hubs. This gave us bigger, better equipped airports at many more locations around the country. As we stand now, the bulk of the industries technical and mechanical expertise is being concentrated into fewer and fewer locations. This is bad for growth and bad for the dissemination of technical capacity across the country.

From a national defense standpoint, we are now at the point where striking ten or fewer selected airports could effectively shutdown passenger air travel across the country.

I'd like to see municipal airports roar back to life and flying become tolerable again.

Trump was right, some of us Americans are dreamers. I dream of comfortable direct flights.

Its called anti-trust. We have fewer hubs because we have fewer airlines.
01-31-2018 08:43 PM
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Post: #19
RE: new infrastructure plan
(01-31-2018 11:57 AM)Claw Wrote:  I think a gas tax hike is probably needed as well.

What I would like to see is something to reverse the mega-hub practice in the passenger airline industry. I have absolutely no idea how to accomplish that from a regulatory standpoint. However, we are becoming weaker as a nation and economy due to this practice.

Decades ago we had many more airline hubs. This gave us bigger, better equipped airports at many more locations around the country. As we stand now, the bulk of the industries technical and mechanical expertise is being concentrated into fewer and fewer locations. This is bad for growth and bad for the dissemination of technical capacity across the country.

From a national defense standpoint, we are now at the point where striking ten or fewer selected airports could effectively shutdown passenger air travel across the country.

I'd like to see municipal airports roar back to life and flying become tolerable again.

Trump was right, some of us Americans are dreamers. I dream of comfortable direct flights.

What's interesting about airlines is how the scheduling model varies across the major carriers; most of them like United and American use the hub and spoke system as you note, in which flights arrive and leave hub airports all around the same time like a movie theater where everything starts within an hour of each other but is dead for an hour and a half in between. Middle-tier flights from the likes of Southwest (who I almost always fly with) and JetBlue use a lot of focus cities and keep flights coming and going at a pretty regular frequency, making them a lot less susceptible to delays at major airports. They're keeping a lot of airports (like St. Louis) from really falling off just because their P&L often can't stomach the landing fees somewhere like O'Hare so they use Midway instead.
01-31-2018 10:03 PM
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RE: new infrastructure plan
(01-31-2018 10:03 PM)Love and Honor Wrote:  
(01-31-2018 11:57 AM)Claw Wrote:  I think a gas tax hike is probably needed as well.

What I would like to see is something to reverse the mega-hub practice in the passenger airline industry. I have absolutely no idea how to accomplish that from a regulatory standpoint. However, we are becoming weaker as a nation and economy due to this practice.

Decades ago we had many more airline hubs. This gave us bigger, better equipped airports at many more locations around the country. As we stand now, the bulk of the industries technical and mechanical expertise is being concentrated into fewer and fewer locations. This is bad for growth and bad for the dissemination of technical capacity across the country.

From a national defense standpoint, we are now at the point where striking ten or fewer selected airports could effectively shutdown passenger air travel across the country.

I'd like to see municipal airports roar back to life and flying become tolerable again.

Trump was right, some of us Americans are dreamers. I dream of comfortable direct flights.

What's interesting about airlines is how the scheduling model varies across the major carriers; most of them like United and American use the hub and spoke system as you note, in which flights arrive and leave hub airports all around the same time like a movie theater where everything starts within an hour of each other but is dead for an hour and a half in between. Middle-tier flights from the likes of Southwest (who I almost always fly with) and JetBlue use a lot of focus cities and keep flights coming and going at a pretty regular frequency, making them a lot less susceptible to delays at major airports. They're keeping a lot of airports (like St. Louis) from really falling off just because their P&L often can't stomach the landing fees somewhere like O'Hare so they use Midway instead.

Southwest also engages in a hub and spoke model for a number of their flights. From where I live, you can't fly to St. Louis direct anymore (change planes at Midway). Midway is pretty much a hub for a large percentage of the flights Southwest has anymore. I haven't had to fly much within the past year, but Delta seems to have really stepped it up and IMHO is better than Southwest in efficiency on a number of flights that I noticed between 1 to 2 years ago.
01-31-2018 10:58 PM
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