Energy, Labor Foresee Trump-Induced Infrastructure Boom
The energy industry and labor movement don’t often agree on much, but after one of the most contentious elections in memory, a group of experts from both sides found that they can unify around one thing: infrastructure.
Throughout the 2016 campaign, infrastructure expansion was perhaps the only policy issue with bipartisan support. Both Hillary Clinton and Donald Trump proposed plans in the hundreds of billions of dollars. Now, with Trump’s election and Republicans in control of both houses of Congress, large amounts of private and government funds may flow into public works projects to upgrade the nation’s crumbling roads, bridges and waterways.
Even Democrats seem on board. In her statement congratulating Trump on his election, House Democratic leader Nancy Pelosi mentioned infrastructure as one of the areas they can work together to address.
“We see two places where good things are going to happen” concerning labor unions and the Trump administration, said Terry O’Sullivan, president of the Laborers’ International Union of North America, during a discussion Friday hosted by RealClearPolitics and sponsored by the American Petroleum Institute. “The energy sector, for sure, and on the transportation infrastructure front -- we’re encouraged as we transition to a new president.”
During the campaign, Trump called for a $1 trillion investment over 10 years in infrastructure. But the plan would involve a controversial funding concept never before used at the federal level – a private-public partnership – trading roughly $137 billion in tax breaks to private investors that would then leverage about $1 trillion to finance work on toll roads, toll bridges and other projects.
Another untried legislative idea would repatriate roughly $2 trillion in U.S. corporation cash that remains in overseas banks through the offering of a one-time lower tax rate. Such revenues, taxed at 10 percent, are projected to boost U.S. Treasury coffers by $200 billion and lower deficit spending. These funds could then be used to create a national infrastructure bank that could then finance domestic infrastructure spending without using taxpayer monies.
O’Sullivan said the laborers’ union currently has over $50 billion worth of work under contract to build pipelines in the U.S. and he believes both the controversial Dakota Access and currently cancelled Keystone XL pipeline will be built in the next two years.
Speaking at the “Energy in Transition” forum that included representatives of the nuclear, oil, natural gas, solar and wind energy industries, API President and CEO Jack Gerard said polls taken on Election Day found that “partisanship has no place in America’s energy policy. The American people support policies that promote domestic energy security and investments in energy infrastructure.”
But $1 trillion is not enough for some. The American Society of Civil Engineers says the U.S. is in need of $3.6 trillion of investment to restore all of the country’s aging infrastructure.