The White House is stepping up talk of enacting an infrastructure bank, and may even be considering making such a bank part of any deal it makes with Congress on the debt ceiling.
An infrastructure bank, using federal seed money and private capital, would invest in large infrastructure projects that could pay back over the years through tolls or other revenues--like sales taxes that back local transit projects.
Washington sources say an infrastructure bank could be part of a deficit deal or emerge as a free-standing piece of legislation.
In the last week, the President and administration officials keep slipping the concept into the public debate. The most recent incarnation was Monday's White House press conference, when the President dropped the words "infrastructure bank" at the end of a thought on economic growth.
"I mean, the infrastructure bank that we've proposed is relatively small. But could we imagine a project where we're rebuilding roads and bridges and ports and schools and broadband lines and smart grids, and taking all those construction workers and putting them to work right now? I can imagine a very aggressive program like that that. I think the American people would rally around (it) and (it) would be good for the economy not just next year or the year after, but for the next 20 or 30 years."
The fact that the President even said the words "infrastructure bank" probably slipped by most folks, who were focusing on the President's vow not to have a short-term deal on debt. But it's a concept he's bringing to the forefront as other avenues for infrastructure spending are noticeably fading.
Stimulus spending, clearly, is out. And as we reported last week, Rep. John Mica, (R-FL), chair of the House Transportation and Infrastructure Committee, last week introduced a six-year, $230 billion surface transportation bill. The bill was a long way from the president's proposed $556 billion proposal, which Obama sent into the world on Valentine's Day. Even so, the Senate isn't expected to ask for much more than the House, and instead may be looking at a $109 billion, two-year bill.
Which may be why the White House is bring the infrastructure bank concept to the fore. Just a few days before the President mentioned it, Austan Goolsbee, chair of the Council of Economic Advisers, pushed the concept in a television interview, as part of a number of other ideas to get the economy moving. "We ought to extend the payroll tax cut. We ought to create the infrastructure bank. We ought to pass the free trade agreements to get exports going..."
The president also talked about infrastructure in his weekly address:
"With a recovery that’s still fragile and isn’t producing all the jobs we need, the last thing we can afford is the usual partisan game-playing in Washington," President Obama said. "By getting our fiscal house in order, Congress will be in a stronger position to focus on some of the job-creating measures I’ve already proposed – like putting people to work rebuilding America’s infrastructure..."
The president has been nothing if not consistent on infrastructure. On Labor Day, he put forward a $50 billion infrastructure plan. On Columbus Day, he refined that plan after a White House meeting with mayors and governors. In his State of the Union address, he pushed making high speed rail accessible to 80 percent of Americans by 2036. On Valentines Day, his budget proposal included a $556 billion surface transportation bill.
But the administration has been noticeably lacking when it comes to ideas for financing infrastructure. Called repeatedly before Congress, U.S. Transportation Secretary Ray LaHood would only say that he "looks forward" to working with them to sort out financing details.
The infrastructure bank, by contrast, is a much easier sell. Senator John Kerry (D-MA), who introduced a bill in the Senate earlier this year, said it would only need $10 billion of federal seed money to start. Kerry's bill has the support of Senator Kay Bailey Hutchinson (R-TX), and Mica has said he supports an infrastructure bank.