Brian Riedl testified before the U.S. Senate Committee on Banking, Housing, and Urban Affairs in a hearing entitled, "21st Century Communities: Local Leaders on the Infrastructure Needs Facing America’s States, Cities, and Towns."
Good morning Chairman Brown, Ranking Member Toomey, and Members of the Committee. Thank you for inviting me to participate in today’s hearing.
My name is Brian Riedl. I am a Senior Fellow in Budget, Tax, & Economic Policy at the Manhattan Institute for Policy Research. The views I express in this testimony are my own, and should not be construed as representing any official position of the Manhattan Institute.
My testimony today will offer four principles for responsible infrastructure investments:
- First, Congress should avoid piling on new taxes or debt. The federal budget is already facing $100 trillion in baseline deficits over 30 years, and any taxes should address that first.
- Second, state and local governments should use for infrastructure the $530 billion in additional federal windfalls they have recently received. In fact, infrastructure is a perfect use of one-time federal funding.
- Third, any additional federal investments should be funded within the current $61 trillion spending baseline over the decade. The offsets are there if infrastructure is truly a Congressional priority.
- Finally, America’s main infrastructure policy challenge is not funding, but rather the slow, bureaucratic, high-cost implementation of the policies. Spending another $1 trillion without making these programs more effective is a poor use of taxpayer dollars.
As an addendum, I will show that there is a broad economic consensus that infrastructure policies do not provide short-term stimulus, and most new construction jobs are redistributed from other jobs.
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