President Donald Trump has dubbed this week "infrastructure week" and promised to roll out plans to revamp how the federal government funds the building and maintenance of roads, railways, ports, and more. His first concrete proposal is to shift the nation's air traffic control system from the Federal Aviation Administration (FAA) to an independent, nonprofit corporation that will be funded by the airline industry.
Although this is the model that has been used successfully in Canada, the United Kingdom, Germany, and elsewhere, it has long been sunk by a bipartisan coalition of congressional lawmakers who insist on maintaining an antiquated system in which flights are still kept track of the same way they were 50 years ago.
"It's an excellent idea," says Robert W. Poole, director of transportation policy at Reason Foundation, the nonprofit that publishes this website. "The government-managed air-traffic system in the United States is lagging behind all the rest of the developed countries. Over the last 30 years, almost all of them have created government corporations mostly or a private nonprofit in Canada, which is really the best model, because a government bureaucracy has a really difficult time running a high-tech service business like air-traffic control. We have intermittent funding, we have sequestration of funding budget for the FAA, we have lousy managers of major procurements who can't seem to get them done on time or on budget. Meanwhile our competitors, so to speak, overseas in the U.K., in Australia, in Canada, [and] Germany have better technology that are all paid for by fees and charges, just like a utility."
Poole is the author of the 2013 study "Funding Important Infrastructure Spending in a Fiscally Constrained Environment," which analyzes public-private partnerships that have successfuly upgrade and operate roads, bridges, and more with little or no tax dollars being spent. In a conversation with Reason's Nick Gillespie, Poole points to projects such as the Indiana Toll Road, which was leased to a private company for 75 years for an upfront payment of around $4 billion under Gov. Mitch Daniels. In addition to the payment, the company committed to updating and improving the road itself and its service plazas while allowing the state oversight on any rate increases for users.
Poole is cautiously optimistic about Trump's infrastructure spending plan because the president is opening the process up to firms that have the capital necessary to modernize American infrastructure without governments at all levels borrowing huge amounts of money. These companies not only have expertise in building and operating large-scale projects, they "hundreds of billions" of dollars they're ready to invest, says Poole. It's just that there haven't been many projects available due to pork-barrel politics that tend to view infrastructure spending as a source of patronage jobs and influence-peddling.