Building walls

The 2018 Omnibus spending bill has been called a ‘down payment’ on infrastructure. But with projects like Gateway being used as political bargaining chips, we’re finding little cause for celebration.

When President Donald Trump signed the 2018 Omnibus spending bill into law on March 23, hours after threatening to veto it, the good news for the US was that another costly government shutdown had been averted. Apparently, there was some good news for the country’s infrastructure as well, since $21.2 billion of the $1.3 trillion approved was being allocated to the sector.

“I think it’s understandable and appropriate for there to be a positive view of the bill because it does provide additional funds for infrastructure,” David Narefsky, a partner at Mayer Brown told Infrastructure Investor. Another source agreed that “the bottom line is there is increased spending across the board on infrastructure and infrastructure-related projects”.

According to the House Appropriations Committee, the bill provides $10.6 billion above the fiscal year 2017 enacted level to rebuild America’s infrastructure. But as a third source pointed out: “This is almost irrelevant to the infrastructure plan. The omnibus bill doesn’t do anything that was indicated in the principles document; it does not create the $200 billion that will somehow miraculously turn into $1.5 trillion by any stretch of the imagination.”

What’s more, the passage of the spending bill and the funds it provides for infrastructure means that the comprehensive infrastructure bill that everyone has been waiting for has been pushed further into the future.

Speaking in Ohio last Friday, the president again referred to “the biggest and boldest infrastructure plan in the last half-century,” but he also admitted “we [will] probably have to wait until after the [mid-term] elections”.

More damaging than the multiple delays, though, is Trump’s undermining of infrastructure’s bipartisan status.

Case in point: the Gateway project, which involves building two new tunnels to replace the existing 107-year old tunnels running underneath the Hudson River and connecting New York to New Jersey.  Having stalled for years due to political bickering over who should pay for it – a common problem facing bi-state projects – a milestone was reached in November 2015, when the federal government and the two states agreed to split the project’s $20 billion cost – since then revised upwards to $30 billion – 50:50.

The project is critical not only for the two states, but for the Northeast region, since it is a vital part of the 457-mile Northeast Corridor, owned and operated by Amtrak, the national passenger rail company.

However, that agreement has now unraveled. Initially categorised as a number one priority out of 50 emergency and national security projects when Trump was president-elect, the Gateway project’s fate was called into question last December, when Jane Williams, deputy administrator of the Federal Transit Administration, called the 50:50 funding agreement between New York, New Jersey and the federal government “non-existent”.

Since then, $900 million in federal funding for the Hudson River tunnel project had made its way into multiple drafts of the omnibus bill, but not in the final version. According to the Washington Post, the reason for this was because Trump tried to use the Gateway project as a bargaining chip for the wall he wants to build along the US-Mexican border.

When that failed, he began urging Republican lawmakers, including House Speaker Paul Ryan, to block federal funding for the project, something Secretary of Transportation Elaine Chao confirmed while appearing before the House Transportation Committee on 6 March.

That kind of politicking should set alarm bells ringing.

“I was always very good at building,” Trump said during his Ohio speech. “It was always my best thing. I think, better than being president, I was, maybe, good at building.”

Maybe he was. But as president, he’s proving particularly adept at building walls. And walls – unlike, roads, bridges and tunnels – lead nowhere.