IRF Brief on the Obama Infrastructure Stimulus Plan
During his weekly radio address on Saturday, President-elect Barack Obama outlined the infrastructure portion of his plan that he would like to see included in the legislation from Congress including funding for roads, bridges and other parts of the country’s physical infrastructure.
On December 6, Obama outlined what would be a massive government investment in the nation’s infrastructure. Congress plans to take up this legislation immediately after the new session convenes in January and hopes to have a bill on the President’s desk shortly after he takes office on January 20th.
Though there is no exact amount attached to the proposal, the initial estimate puts the total cost around $500 billion. As outlined thus far, the measure would provide funding for states facing budget shortfalls, social services projects for the poor and infrastructure projects. The legislation is also likely to include a tax proposal.
Democrats in Congress have tried pushing similar smaller stimulus packages in recent months but have faced objections from the current administration and congressional Republicans, who argue these programs will do little to jump start the economy in the short term. GOP leaders would prefer a plan that focuses primarily on tax cuts for individuals and businesses rather than new government spending that will add to the already large budget deficit. Democrats argue that their plan will do more to stimulate the economy because it will create jobs and address energy issues.
Oberstar Infrastructure Stimulus Proposal
This morning, House Transportation and Infrastructure Chairman James Oberstar (D-Minn.) recommended that $45 billion in infrastructure spending be allotted within the economic stimulus package that is expected to be taken up in January.
Chairman Oberstar said the figure could grow, though he acknowledged that only a finite number of projects are ready to commence within 90-100 days, as the bill will most likely dictate. The time frame set for money to be spent in the last stimulus bill to pass Congress in September was 120 days.
Oberstar’s outline for the proposed $45 billion includes:
- $18.25 billion for highway transportation projects
- $2 billion for Amtrak and other rail projects
- $1 billion for aviation
- $9 billion for environmental infrastructure improvements
- $5 billion for the Army Corps of Engineers for water projects
- $2.5 billion for the “greening” of federal buildings
- $420 million for the Coast Guard
- $65 million to boost shipping projects by the federal Maritime Administration
The consensus right now is that this bill will be ready to go shortly after Obama takes office on January 20th. That being said, there are many elements to be worked out and have not been discussed, at least not publicly. The main question among legislators is if there will be a tax element attached to the bill. None of the congressional committees with jurisdiction over taxes have commented on the proposed stimulus package to date.
Another question remains who will take the lead in crafting the bill – will it come from House and Senate leadership or will they parcel it out to the committees with jurisdiction. There are very few details on the process at this point.