A federal infrastructure plan should be an opportunity for reforming federal funding programs, rather than an occasion for more lavishing of federal funds. Michael Sargent writes:
[F]or all the enthusiasm about spending on infrastructure, there is little compelling evidence that warrants a large federal investment bill. Federal data reveal that the nation's major road, bridge, and aviation assets are in satisfactory condition, and in most cases are improving. The narrative that public investment in infrastructure is historically low is false. From 1956 to 2014, total inflation-adjusted public investment in transportation and water infrastructure increased by roughly 200 percent—dramatically outpacing population growth—while remaining steady as a share of gross domestic product (GDP).
Infrastructure that is in poor condition tends to be local in ownership and character, and is generally funded through local general revenues rather than user fees. These assets are poorly suited for expansive federal intervention through new spending programs. Federalism wisely dictates that local infrastructure is properly managed by local authorities—those most responsive to the users of the infrastructure—while federal involvement, if any, is limited to infrastructure of nationwide significance. Aside from inundating local construction projects with a barrage of federal regulations, enlarging federal funding to cover local assets would only worsen accountability in funding decisions and provide perverse incentives to localities, further distorting the poor local decision making that has led to the current degraded state of certain infrastructure.
For a guide on how to judge the Trump administration's forthcoming infrastructure plan, see Sargent's paper, "Unleashing Investment or Expanding Federal Control? How Proponents of Limited Government Should Evaluate the Trump Infrastructure Plan," The Heritage Foundation, January 20, 2018.
Influence! The Heritage Foundation ranked as the think tank with the most significant impact on public policy in 2017 according to the annual "Global Go To Think Tank Index Report."
The rankings are based on evaluations by 62,000 experts of the work of 7,815 think tanks world wide. The report, compiled by James G. McGann at the University of Pennsylvania's Think Tanks and Civil Societies Programs, was released Wednesday.
According to The Heritage Foundation's own analysis, "64 percent of the policy prescriptions in its 'Mandate for Leadership' series were included in President Donald Trump's budget, implemented through regulatory guidance, or under consideration for action in accordance with The Heritage Foundation's original proposals."
At the publication's release event at the Wilson Center, Heritage Foundation President Kay Coles James said: "We have had a profound opportunity as a think tank to influence the policy in this particular administration, both on the economic side and foreign-policy side, and on many of the domestic issue." [Heritage Ranked No. 1 Globally for Impact on Public Policy, February 1]
The Heritage Foundation also ranked highly in the following categories: worldwide (8), United States (4), domestic economic policy (5), advocacy campaign (2), use of social media (4), and think tank to watch in 2018 (2).
A good number of other conservative and free market think tanks also received high rankings, including the Acton Institute for advocacy campaign (9), the Adam Smith Institute for domestic economic policy (2) and independent think tank (3), the American Enterprise Institute for independent think tank (10), Americans for Tax Reform for advocacy campaign (6), the Cato Institute for United States think tank (10), the Centre for Independent Studies for Southeast Asia and the Pacific think tank (10), the Foreign Policy Research Institute for think tank with an operating budget less than $5 million (7), the Fraser Institute for Canada and Mexico think tanks (1) and social policy (4), the Hoover Institution for university affiliated think tank (8), the Imani Center for Policy and Education for sub-Saharan African think tank (3) and think tank with an operating budget less than $5 million (7), and the MacDonald Laurier Institute for Canada and Mexico think tanks (10).
Congratulations to all!
Full rankings: "2017 Global Go To Think Tank Index Report," by James G. McGann, University of Pennsylvania, January 31.
One reason the economy is good: The Trump administration has removed many government obstacles to real productivity gains. Richard Epstein writes:
To take one example—on a topic on which I have worked as an industry consultant—compare the Obama administration's willful obstruction of the approval of the Dakota Access Pipeline with the Trump administration's approach. The permitting process lets government administrators either speed up or shut down a particular activity. In December 2016, the Army Corps of Engineers had approved the Dakota Access Pipeline, only for the Obama administration to flout the rule of law by overriding the Corps' technical judgment for nakedly political reasons, ordering a full scale environmental impact statement that could easily have taken years to complete, knowing full well that the billions of dollars already invested in the nearly completed pipeline could quickly go to waste. To its great credit, the Trump administration reversed that decision early on by Executive Order, and allowed the standard approval process to run its course without political intervention.
A year later, the results are clear to see. The pipeline is up and running without a hitch. Its hefty direct revenues are only part of the overall picture. In addition, the pipeline's operations have already generated huge environmental benefits by cutting dramatically the amount of oil shipped by rail and truck. Using dedicated facilities in controlled environments to ship crude oil is far safer than transporting it in these mixed-use modes of transportation. Secure and reliable shipment also induces drilling companies to increase their levels of production, knowing that their crude oil can go to market. The higher volume of activity increases the demand for both labor and equipment as new facilities open up in North Dakota. At the opposite end of the distribution system, cheaper and more reliable energy sources trigger increases in activities in industries too diffuse to catalogue. All the while, the higher profits and wages create additional tax revenues that, wisely used, can improve the physical and social infrastructure that support these activities.
Read the rest: "The Trump Growth Machine," by Richard A. Epstein, Hoover Institution, January 29.
Growth first. Amity Shlaes writes:
Through Gini's lens, we now rank past eras. Decades in which policy endeavored or managed to even out and equalize earnings—the 1930s under Franklin Roosevelt, the 1960s under Lyndon Johnson—score high. Decades where policymakers focused on growth before equality, such as the 1920s, fare poorly. Decades about which social-justice advocates aren't sure what to say—the 1970s, say—simply drop from the discussion. In the same hierarchy, federal debt moves down as a concern because austerity to reduce debt could hinder redistribution. Lately, advocates of economically progressive history have made taking any position other than theirs a dangerous practice. Academic culture longs to topple the idols of markets, just as it longs to topple statutes of Robert E. Lee.
But progressives have their metrics wrong and their story backward. The geeky Gini metric fails to capture the American economic dynamic: in our country, innovative bursts lead to great wealth, which then moves to the rest of the population. Equality campaigns don't lead automatically to prosperity; instead, prosperity leads to a higher standard of living and, eventually, in democracies, to greater equality. The late Simon Kuznets, who posited that societies that grow economically eventually become more equal, was right: growth cannot be assumed. Prioritizing equality over markets and growth hurts markets and growth and, most important, the low earners for whom social-justice advocates claim to fight. Government debt matters as well. Those who ring the equality theme so loudly deprive their own constituents, whose goals are usually much more concrete: educational opportunity, homes, better electronics, and, most of all, jobs. Translated into policy, the equality impulse takes our future hostage.
For a thorough debunking of the progressive fixation on equality, read Shlaes's tour of American economic history in "Growth, Not Equality," City Journal, Winter 2018.
And now for the rest of the story …
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