Fareed Zakaria recently joined a growing group supporting a National Infrastructure Bank. His piece, though, moves the ball forward. Zakaria begins to make the case for Republican and Tea Party support. Let's flesh it out a bit.
Zakaria makes two main arguments:
- An American Infrastructure Bank would make decisions based upon project merits rather than upon formulas or earmarks
- Today, the US infrastructure market is dominated by the government, and an infrastructure bank would introduce greater private participation
I'd like to make five additional points:
- Rather than give projects grants or gifts, an IBank would provide loans and loan guarantees with the expectation of getting repaid
- State and local governments, and the private sector would be responsible for spearheading projects, rather than marching to the federal government's orders. The IBank would simply lend a hand
- Projects would have to generate a revenue to repay their investors, so they have to provide users with a valued service. If projects don't provide this incentive, then they are simply poorly structured.
- An IBank that creates incentives to do water, transportation and clean energy projects -- like the bipartisan American Infrastructure Financing Authority proposed by Senators Kerry, Hutchison, Graham and Warner -- would benefit industrial real estate developers by helping businesses who want to build factories put together packages with private co-investors to make sure that they have enough water, transportation and energy for surge manufacturing
- Businesses and labor unions would have incentives to work together to build things cooperatively -- which is why Tom Donohue of the US Chamber of Commerce and Richard Trumka of the AFL-CIO support it.
Now we just have to convince Progressives.