There’s at least one honest man among the left in this world, and he supports Neil Gorsuch for the Supreme Court: I was an acting solicitor general for President Barack Obama; Judge Gorsuch has strong conservative bona fides and was appointed to the 10th Circuit by President George W. Bush. But I have seen him up close and in action, both in court and on | Read More »
Americans could save $1 trillion over 10 years by financing infrastructure through publicly-owned banks like the one that has long been operating in North Dakota.
President Donald Trump has promised to rebuild America’s airports, bridges, tunnels, roads and other infrastructure, something both Democrats and Republicans agree should be done. The country needs a full $3 trillion in infrastructure over the next decade. The $1 trillion plan revealed by Trump’s economic advisers relies heavily on public-private partnerships, and private equity firms are lining up for these plumbing investments. In the typical private equity water deal, for example, higher user rates help the firms earn annual returns of anywhere from 8 to 18 percent – more even than a regular for-profit water company might expect. But the price tag can come as a rude surprise for local ratepayers.
Private equity investment now generates an average return of about 11.8% annually on a 10-year basis. For infrastructure investment, those profits are made on tolls and fees paid by the public. Even at simple interest, that puts the cost to the public of financing $1 trillion in infrastructure projects at $1.18 trillion, more than doubling the cost. Cities often make these desperate deals because they are heavily in debt and the arrangement can give them cash up front. But as a 2008 Government Accountability Office report warned, “there is no ‘free’ money in public-private partnerships.” Local residents wind up picking up the tab.
There is a more cost-effective alternative. The conservative state of North Dakota is funding infrastructure through the state-owned Bank of North Dakota (BND) at 2% annually. In 2015, the North Dakota legislature established a BND Infrastructure Loan Fund program that made $50 million in funds available to communities with a population of less than 2,000, and $100 million available to communities with a population greater than 2,000. These loans have a 2% fixed interest rate and a term of up to 30 years. The proceeds can be used for the new construction of water and treatment plants, sewer and water lines, transportation infrastructure and other infrastructure needs to support new growth in a community.
If the Trump $1 trillion infrastructure plan were funded at 2% over 10 years, the interest tab would come to only $200 billion, nearly $1 trillion less than the $1.18 trillion expected by private equity investors. Not only could residents save $1 trillion over 10 years on tolls and fees, but they could save on taxes, since the interest would return to the government, which owned the bank. In effect, the loans would be nearly interest-free to the government. […[
Legislators in cash-strapped communities are likely to object, “We can’t afford to lend our revenues. We need them for our budget.” But banks do not lend their deposits. They actually create new money in the form of bank credit when they make loans. That means borrowing from its own bank is not just interest-free to the local government but actually creates new money for the local economy.
QUOTATION OF THE DAY
“One of the qualities of liberty is that, as long as it is being striven after, it goes on expanding. Therefore, the man who stands in the midst of the struggle says, ‘I have it,’ merely shows by doing so that he has just lost it.” —Henrik Ibsen, 1871
At Daily Kos on this date in 2006—NSA Surveillance: How It Puts You in Danger:
Polls are all over the place on Americans’ views on the NSA program, depending on the precise wording of the question, but for the sake of argument, I’ll grab the recent CNN pollthat claims roughly half of the population thinks it’s okay for the feds to conduct surveillance and collect data without a warrant. Based on this, I assume most of us have friends, family members or co-workers who’ve uttered the words: I have nothing to hide, so why should I care about NSA surveillance?
Here’s a primer on why they should care.
It puts you at risk for identify theft … and IT’S ILLEGAL
From all reports we’ve heard about the secretive NSA program, it’s a vast vacuum operation that collects data, stores it and shares that information with other agencies, all without a warrant. Anything that’s done with electronic transmission is trackable in practical terms – meaning online credit card purchases and bill paying, ATM transactions, paying for groceries with a debit/credit card. PINS, passwords, Social Security numbers, driver’s license identifier information, bank account numbers, all are available … all in the hands of federal agencies and their employees. […]
On today’s Kagro in the Morning show, it was all about the Trump Bannon-driven upheaval in the Department of Justice. The implications. The succession mechanisms. The movements behind the curtain. The response of the Resistance. Armando joins host DavidWaldman in puzzling it out.