Industry Voices

Barry’s Pickings Online: Retirement Policy and the 2017 Election

Congress should stop making retirement policy simply as a way to fund infrastructure spending.

By PS | September 01, 2016
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PS_Barry_JCiardielloArt by Joe CiardielloBoth Presidential candidates, former Secretary of State Hilary Clinton and Donald Trump, have made infrastructure spending a centerpiece of their campaigns.

Clinton proposes to spend $275 billion to “fix America’s infrastructure.” According to campaign literature, her plan will “help repair crumbling bridges and roads. It will also mean world-class airports, a faster rail system, and broadband internet access for every American household.”

According to Donald Trump, “We have a great plan and we are going to rebuild our infrastructure.” Clinton’s infrastructure number “is a fraction of what we’re talking about, we need much more money than that to rebuild our infrastructure.  … I would say at least double her numbers and you’re going to really need more than that.”

Clinton says that she would “fully [pay] for these investments through business tax reform.” Trump says that “citizens would put money into [an infrastructure fund] and we will rebuild our infrastructure with that fund and it will be a great investment and it’s going to put a lot of people to work.”

That last point is key—because the magic of infrastructure spending for politicians is not so much the bridge that is being fixed but the jobs that are created fixing it. As Clinton puts it, infrastructure spending is “part of a comprehensive package to create the next generation of good-paying jobs and help American workers compete and win in the global economy.”

But—and strangely, given the alleged continued urgency of this problem—we have had over the last eight years nearly continuous infrastructure spending. It began with (relatively modest) 2009 stimulus spending on “shovel ready jobs.” But it really took off in 2012, when Congress passed the Moving Ahead for Progress in the 21st Century Act (MAP-21), which included more than $94 billion in transportation spending over two years (2013 and 2014). That legislation was funded not by a “business tax,” and indeed, most, including many Democrats believe that US “business taxes” (e.g., the corporate tax) are already too high.

NEXT: Infrastructure spending vs. retirement savings