As opponents competing for the White House in the upcoming US election, it is not surprising that the presumptive nominee for the Democratic Party Hillary Clinton and her Republican counterpart Donald Trump stand on opposite sides on many issues, including immigration, foreign policy, and climate change. But one thing they do have in common is infrastructure.
“If you see both sides, the only thing they are actually talking about right now is infrastructure,” said Robert Wolf, founder and chief executive of 32 Advisors, addressing a room of infrastructure investment professionals at a recent industry event. “It's interesting because it's really the only issue that probably should not be that polarising in this country.”
Michael Likosky, a principal at the firm and head of its infrastructure group, agreed. “As Robert said, I think this is the centerpiece of each of their economic programs.”
But the common ground ends there.
Aside from his infamous wall – Trump has talked about building a wall on the US-Mexico border to keep illegal immigrants out while creating jobs – and broad statements about the country's infrastructure needs, Trump's plan is light on details.
Clinton, on the other hand, has put forth a very detailed proposal. She intends to boost federal investment in the sector by $275 billion over the next five years and create a $25 billion national infrastructure bank. “At the end of the day, the Secretary is going to have a very granular, detailed policy,” Wolf remarked, referring to Clinton.
“The one thing we know about the Secretary is she likes to be in the weeds.”
According to Wolf, Clinton's infrastructure proposal “really is the lead for her economic policy.”
Infrastructure has played a central role throughout Clinton's career, according to Likosky, who described her as a “Post-Reagan Democrat”. “Before there was women's rights, before there was healthcare, she did all the stumping on infrastructure; it was her regular stump speech,” Likosky said. “And her view has always been P3s.”
Focusing on Trump, Likosky explained that the Republican presumptive nominee “wants to put in over $1 trillion into the economy so he wants a big fiscal infrastructure stimulus”. The way he wants to pay for it, according to Likosky, is by the government using the revenues from a repatriation of corporate profits, business tax reforms, and through an oil and gas revenue sharing approach to projects such as the TransCanada pipeline wherein the US deposits those revenues into an account dedicated to infrastructure.
“Trump is taking one out of President Obama's 2008 campaign playbook ,” Likosky observed. “He's talked about the Iraq war and how we should have used that money to invest in US infrastructure. This was a position the President took.”
President Obama had also made infrastructure one of his top priorities during both terms in office, but his plans proved more ambitious than the outcome, in great part due to the “polarising environment” that's characterised Congress in the past few years and to which Wolf alluded. But if this environment persists, will Clinton's or Trump's plans really matter?
“We should all recall, presidents get wins in the beginning,” Wolf responded. In President Obama's case, his two main priorities were healthcare and financial services reform. In the current election, “I believe whether it's President Trump or President Clinton, I think the first thing will be something on the economy,” Wolf said, noting that appointing a Supreme Court justice to fill the vacancy created by the death of Antonin Scalia could also be one of the first issues to be tackled, although that might occur before the new president assumes office.
“But on the economy, the one thing that everyone agrees can provide a boost is infrastructure,” Wolf remarked. “So I would take the other side of that bet – I actually think that infrastructure is the one thing they can get done.”