Our dear friends Mike Bloomberg and Arnold Schwarzenegger and their pal Ed Rendell dropped by Washington this weekend, first to visit with President Obama and then, today, Meet the Press. They were in town to promote their two-month old partnership, Building America’s Future, which seeks to promote the reconstruction of the nation’s aging infrastructure along with its expansion into the future.
[Rendell] said the three men delivered three messages to the president and his team of advisors. One, that the president should take control of the infrastructure debate. Secondly, that a so-called “infrastructure bank” is essential. And three, that all funding possibilities should be explored.
“The president gets it,” Bloomberg said. “This is about the future of our country. Whether it is transportation or water or other things, we need to invest now so that our children and grandchildren will have a future.”
According to NY1, there’s still much work to be done:
Bloomberg acknowledged that infrastructure projects produce limited immediate jobs, but Schwarzenegger said that vehicular and mass transit systems need bailouts of their own.
“We have maybe spent $900 billion to $1 trillion in the next five years, but we really should be spending $2.2 trillion in the next five years in order to keep up with the demand,” said California’s governor.
You can also watch Building For America’s press conference from the White House lawn on YouTube. If all that weren’t enough, the three shed more light on their ideas during their Meet the Press appearance (transcript here). Rendell put it best:
MR. GREGORY: So, Governor Rendell, first of all, it was Governor Schwarzenegger who said infrastructure’s not a very sexy word when it comes to building political will. What are we talking about here? Bridges, roads, what else?
GOV. ED RENDELL (D-PA): Well, it’s not just transportation infrastructure. First of all, high-speed rail. This country desperately needs to build a high-speed rail passenger system. We need to improve our rail freight system. But it’s not just transportation. It’s the levees that failed in Cedar Rapids and New Orleans. It’s dams, it’s water and wastewater systems. It’s so much more. And the message is fairly clear. We started Building America’s Future because we think this is about the future. We think it’s about generations down the road. And unless we can rebuild our infrastructure, we’re not going to be competitive. Unless we can rebuild our infrastructure, our quality of life is going to suffer. Unless we rebuild our infrastructure, things like what happened in Minnesota are going to repeat.
MR. GREGORY: Bridge collapse.
We took a poll, Building America’s Future, and the poll showed the American people are willing pay for infrastructure improvements, pay more taxes, if they believe it’ll be done in a nonpolitical way, if the choices made will be good choices based on cost benefit analysis. That was our message to the president. We’re willing to support him. We think the infrastructure bank is terrific. We need to do it in a little bit bigger scale.
Perhaps the most intriguing part of the group’s work is its desire to drive infrastructure expansion through the issuance of bonds and the cultivation of public-private partnerships:
MAYOR BLOOMBERG: Yes, the amount of stimulus in the–the amount of money in the infrastructure package is a small amount. But Governor Rendell–who deserves all the credit, I think Arnold would agree with me, to putting this organization together–has talked about how you can leverage that money. And today it takes a while to get projects going. This president’s willing to face the issues and he’s going to have to work with Congress.
MR. GREGORY: Right. And we talk about private equity. There’s so much money in this economy on the sidelines with nowhere to go and nobody wanting to assume any risk. So if there’s this kind of private sector money, how would it work? If they–if private equity or hedge funds want to put up money for a light rail system, fast rail system around the country, what’s in it for them?
GOV. SCHWARZENEGGER: Well, it’s a, it’s a great investment. I mean, that’s what–it’s like when you look at British Columbia or other places where they have a public-private partnership, where everyone is happy. Businesses are happy, the people are happy, labor is happy, the politicians are happy. I mean, everyone is happy. We want to do the same thing. We should–the United States should copy that kind of a principle so that you can go out there and build.
GOV. RENDELL: There’s so many innovative ways to, to use the tax code to get private investment involved in this. There are innovative ways. David, we don’t have a capital budget, a federal capital budget. We’re the only governmental subdivision in the country without one. You could finance–for $30 billion a year, which these days is not a lot of money, you could finance almost $400 billion to put up front in an infrastructure repair program administered through something like the infrastructure bank.
While public-private partnerships have, indeed, been a success in the past, they also pose problems, as recent hitches resulting from the recession have shown. Furthermore, to propose “leveraged,” perhaps highly leveraged, deals with the same private equity and hedge fund firms that got us into the mess this infrastructure is supposed to get us out seems suspect. Just imagine what an infrastructure bubble might look like. Probably lots of bridges to nowhere.
Where the coalition is headed from here remains to be seen, but if Bloomberg’s similar effort, Mayors Against Illegal Guns, is any indication–to say nothing of his work reshaping the city’s physical culture–it’s due for a smashing success.
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