American Elephants


“Crumbling Infrastructure” Is Just Another Lefty Lie! by The Elephant's Child

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Once again, we are back to “crumbling infrastructure,” This has been the one big thing Obama has had on his “to do” list since 2008. So important and he thought it would create all kinds of new jobs for his union supporters — but for six years it has been just talk. It seems to be the only Keynesian idea he has for creating jobs.  As usual, it’s all talk − no action.

What he wants is to confiscate 14% of the earnings of American corporations that is parked overseas. He claims a one-time tax that would be directed to repairing our “crumbling infrastructure.”The tax is a non-starter, of course, but who in their right mind would allow the federal government to confiscate money in banks around the world for just “one time? ”

Profits earned by an American company overseas are taxed in the country where they are earned. When what’s left after paying taxes to the host country is repatriated to the U.S., this country taxes it again. Our corporate tax is already the highest in the industrialized world, at 39.1%. The average for other countries is 25.1%. When companies pay lower taxes, they are more able to grow and hire and earn more, and so the income to the government rises — incentives. Democrats simply cannot get their minds around this phenomenon.

According to an OECD report, the United States spent 3.3 percent of its GDP from 2006-2011 on infrastructure. The European Union, with a larger GDP, has spent 3.1 percent. By the CBO’s statistics, infrastructure spending has been between 2.3 percent and 3.1 percent of GDP since 1956. Our infrastructure is in good shape, and the “crumbling roads and bridges” has been a leftist talking point to the point where everybody believes it, with no evidence whatsoever.

The president dramatically claimed “We’ve got more than 100,000 bridges that are old enough to qualify for Medicare.” Cute talking point, but a recent Reason Foundation study examined 20 years of state highway data to find that the condition of America’s state-controlled roads had improved in seven key areas. The percentage of deficient bridges in the country had fallen from 37.8 percent in 1989 to 23.7 percent in 2008.

The federal Highway Trust Fund, however, is running out of money. Some senators see this as a problem demanding a rise in the gas tax. But the fund is depleted because the money is being spent on frivolous things like bike lanes, rapid transit, light rail. even Amtrack. The fund was established to use gas taxes and tolls to keep up the highways.

Randall O’Toole is an expert at Cato on transportation issues. He writes:

Contrary to popular reports, our highways and bridges are in great shape. Despite the fact that Congress has diverted well over a fifth of gas taxes to non-highway projects, the number of bridges considered “structurally deficient” has declined by more than 50 percent since 1990 and the average smoothness of our roads has increased every year.

President Obama brags on the decrease in the deficit, and credits his fiscal management. At the same time he wants to eliminate the strictures on spending caused by the sequester — which is what forced a decrease in the deficit —that he has whined about ever since they were enacted. Obama says it’s time to end the “mindless austerity” and start spending again — just not on national security.

In fact, Obama just wants more money to spend. His budget proposals are meant as demands. He has already added more to the National Debt than the accumulated spending of all previous presidents put together — so now he wants to add another $6 trillion over the next ten years.




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