Frum’s Infrastructure Bank

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"Frum’s Infrastructure Bank"

David Frum’s proposed State of the Union speech contains both a lot to like and some to dislike, along with this wonky proposal:

I propose that all revenues from gasoline taxes, aviation fees, and other similar sources be placed in a fund directed by an independent infrastructure bank. The bank would be permitted to issue bonds up to a certain level, too. Instead of Congress writing a highway bill every five years, the bank would develop a list of priorities — no politics allowed. I’d suggest we have seven directors of the bank. Three would be nominated by the president and confirmed by the Senate. Two would be nominated by a conference of the Republican state governors, two more by a conference of the Democratic state governors. The directors would serve fixed and overlapping terms. When we’re balancing the budget, we can move slowly through the list of bank infrastructure priorities. In a year like 2011, when it’s cheap to borrow and workers need jobs, we can bring projects forward faster. Congress would always have the last word, in an up-or-down vote. And Congress would decide whether to increase or reduce the flow of future tax revenues into the infrastructure bank.

Every American will have the reassurance that these new infrastructure projects are not pork barrel. They were not chosen to reach some political deal. The money you pay at the pump or at the airport or in future taxes on carbon dioxide and other pollutants will be reinvested toward faster travel, more advanced telecommunications, and cleaner water.

I like the spirit of this suggestion, but worry about the details. Slightly more than fifty percent of the American people live in California, Texas, New York, Florida, Illinois, Pennsylvania, Ohio, Michigan, and Georgia and slightly less than 50 percent of the population lives in the other 41 states. Wouldn’t the practical impact of board dominated by gubernatorial appointments be to even further exaggerate the American political system’s over-weighting of the interests of low-population states? Crowded airports in New York, Dallas, Los Angeles, Chicago, Houston, Miami, and Atlanta would be taxed to finance upgrades in Cheyenne and Albuquerque. Instead of a rail tunnel under the Hudson, we’d get a bridge to nowhere . . . exactly the problem this proposal was supposed to solve.

More generally, I’m skeptical of this kind of bipartisanship by fiat. If you think about an era of relatively unpolarized parties, mandatory bipartisanship in commission composition becomes an effective way of ensuring that patronage is doled out in an even-handed way. But in a polarized era, I think it mostly encourages tactical extremism in appointments—the most important qualification by far becomes the person’s reliability as a partisan warrior.

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