The House of Representatives late Friday approved a key element of the Biden administration’s domestic agenda — a $1.2-trillion infrastructure bill. The media focused on the politics of the measure — how it will bolster the president’s approval ratings, conservative pushback at the 13 Republicans who voted “yes” and its opposition by six progressives.
But the politics is a side issue. This outrageously expensive package adds to an annual federal deficit that already tops $2.8 trillion, despite some farcical claims to the contrary. “Democrats claim the bill pays for itself through a multitude of measures and without raising taxes,” CNN reported, but “the Congressional Budget Office brushed aside several of those pay-for provisions.”
Congress said it would repurpose leftover money originally earmarked for COVID-19 relief, but those were always only borrowed dollars. Furthermore, CNN noted Congress’ spending gimmicks to “pay” for the bill, such as delaying the implementation of a new Medicare and Medicaid rule.
We can’t count how often the supporters of some massive new spending bill claim that it will pay for itself or save money in other areas of the budget. This never happens. Typically, bureaucracy and overly generous labor and consulting contracts diminish the appropriated funds.
Infrastructure is indeed crucial for the economic progress of our nation. We all see that our roads, highways, bridges and transit systems have gotten shoddy. The government does a remarkably poor job of maintaining structures that it had previously funded, so we have no gripe with the stated purpose of the bill. The devil, however, always is in the details.
As typically happens, much of what’s termed infrastructure isn’t really traditional infrastructure. The legislation, for instance, spends $15 billion on subsidies for electric vehicles and charging stations. The nation’s ports — especially at Los Angeles and along the West Coast — are struggling with backlogs. Some of the port-directed funds simply mandate investments in low-carbon technologies.
Much of this spending is more properly the responsibility of states and localities. Some of the federal spending is long overdue, such as investments in bridge repairs and our crumbling interstate highways, but the spending bill ends up simply throwing money at problems without much concern for efficient spending practices.
The libertarian Reason magazine explained that the legislation is “larded up with provisions that will make infrastructure projects more costly for taxpayers,” including costly “Buy American” provisions. “The infrastructure bill could have been an opportunity to reform other federal rules that unnecessarily drive up the cost of building infrastructure,” it added.
Those include the convoluted environmental review process and labor rules that require payment of union wages. The president and congressional Democrats seem to view this as a massive make-work project where additional spending is a good in itself — rather than a chance to get as much rebuilding accomplished as possible. It will potentially keep alive poorly conceived boondoggles such as California’s high-speed-rail line to nowhere.
The bill reinforces our usual take on government spending. Lawmakers love to appropriate money without worrying about how that money ultimately is spent. The only good take we have is that matters could have been worse, given some progressives’ failure to use their opposition to this bill to leverage support for an even-worse $1.75-trillion social-spending and climate bill.
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