Republicans Want You (Not the Rich) to Pay for Infrastructure

One of the worse things the last Republican governor of Virginia and the then GOP controlled Virginia General Assembly was to authorize so-called "public-private" financing schemes for two tunnels between the cities of Portsmouth and Norfolk as well as to replace a much used bridge.  The bridge before replacement had been free and the tolls on the tunnels had been lower before private interests took over management.  What the phase "public-private" turned out to mean was the public got royally screwed while the wealthy private interests got very rich at public expense.  Worse yet, through for unpaid tolls, because of late fees and "administrative fees" a few dollar toll could become $60.00 in little over 30 days and soon many of the poorest local residents faced thousands of dollars in fees to the truly rapacious private interests and risked having their vehicle registrations not being renewed.  Why do I relate this history?  Because, if Republicans have their way, the entire country may soon face a similar predatory scheme for financing much needed infrastructure improvements.  Rather than increase taxes on the super wealthy and corporations, the average citizen will be screwed over in yet another example of the GOP's reverse Robin Hood agenda.  The GOP must be stopped.  A piece in the New York Times looks at this horrible means of screwing average citizens to protect the very wealthy.  Here are highlights:

Twenty-one senators, led by Rob Portman of Ohio, a Republican, announced a new outline agreement for an infrastructure package last week. Disagreement over tax changes derailed previous talks, but this bipartisan group claimed to have identified a set of proposed financing sources that could pay for new spending “without raising taxes.” Reportedly, the largest among those was $315 billion from alternative financing schemes known as public-private partnerships.

The legislators are jumping through these hoops in the first place because for the past three decades, the Republican Party has organized its agenda around an absolutist principle: no new taxes, ever. But despite the senators’ insistence, these arrangements do not actually avoid extractive charges on residents. They just launder the new fees through private investors.

Rather than the government financing the rebuilding of roads and bridges that get you across town, you pay a private company operating in contract with the government — while policymakers pretend that they have avoided imposing new costs.

Chief among these schemes that Republicans have identified are so-called user fees, like road tolls and a new fee on vehicle miles traveled. The White House rejected such proposals as violating its own tax pledge: a promise not to increase taxes on families earning under $400,000 annually. As President Biden observed, “If everything is paid for by a user fee, the burden falls on working-class folks, who are having trouble.”

[U]nlike progressive taxes, user fees — whether assessed by public entities or by private firms contracted with the state — are not generally varied by ability to pay. They are imposed at a flat rate, on the poorest and wealthiest alike, assessed in proportion to their use of public infrastructure. These extractive revenue models condition access to critical goods and services on families’ available resources. And unlike with consumer goods, people often have no choice but to use these spaces.

In 2008, to avoid raising property taxes, Chicago famously leased its parking meter infrastructure to a group of private investors. Shortly after the asset sale, residents parking downtown were paying more than double the prior rates.

The lesson is clear: Flat-rate user-funded structures privatize social risks while shielding wealth from productive public use. This underlying dynamic does not change when such fees are imposed by unaccountable private investors rather than the state.

As negotiations continue, we can learn from the harmful consequences brought about by the privatization of local public goods — and opt instead for an inclusive public infrastructure that is available, and affordable, to everyone.