Reuters reported that the White House is considering a new public-private venture that would be underwritten by investors and could bring private investment in an international new infrastructure project.
The Enterprise Public-Private Investment Initiative (Empower) would feature $200 billion to $300 billion in funding from private investors, but no direct investment by the federal government, Bloomberg reported. It’s planned to be partnered with the World Bank’s International Finance Corporation, in addition to other public and private entities, to give foreign investors the protection they need from U.S. retaliation should investors refuse to buy Iranian oil.
Here are a few things to know about the program:
The “Empower” concept looks awfully familiar to many. It is similar to the “Clean Power Plan” from President Obama’s administration, which mandated cutbacks in carbon dioxide emissions. It was put on hold by President Trump.
That Obama project was subjected to numerous legal challenges and eventually succeeded only in forcing the power sector to rely on renewable energies. But that was for a noble cause, anyway. The Trump Administration has no such motivation. The administration is simply opposing Obama-era policy on the basis of its belief that it’s bad policy.
The White House can justify Empower as neutral, legalistic, and reasonable, but those things matter in the minds of many people. “The whole American policy has been driven by the notion that the U.S. has too much influence,” Mitchell Barak, a former U.S. Commerce Department official told Politico. “The idea is we as Americans have too much influence and are arrogating to ourselves too much.” If Obama can complain about being a “gas station in the sky,” as Treasury Secretary Steve Mnuchin has described the Obama plan, then President Trump is entitled to throw the press corps overboard in the name of “free trade” and other slogans that use the threat of intervention to advance corporate interests.
The administration’s policy will impose strict timelines that the energy sector has repeatedly failed to meet. Past administrations, from Obama on down, have previously done the same, only to be proven wrong by the market. President Trump is not “America first” in the way that President Reagan was “America first,” but in the same way that Nixon, Kennedy, and Reagan were.
President Trump is no fiscal conservative, either. His tariffs and the funding constraints of Empower are a sign that the United States is run by hacks from Goldman Sachs who trade in oil and corporate bonds but don’t understand how the rest of the economy works. President Reagan understood that the free market was superior to government intervention in every area, including energy. President Trump understands that the stock market is a huge driver of inflation and an effective stimulus to the real economy.
No one really wants American producers, traders, or consumers hurt. But if President Trump thinks that Congress would vote to impose more tariffs and undercut the free market, that’s his problem. If he thinks that foreign investors would invest as if our economy isn’t global and interdependent, that’s his problem.
The president will focus on an infrastructure project because he can do it — he doesn’t have to worry about how to fix Obamacare or the debt ceiling. That only leaves him more space to choose his friends and his enemies.
Real populists like President Trump want to help the people at the bottom of the economic ladder. Real populists like President Trump want to move production overseas to make more money so that we can find better workers. Real populists like President Trump have only one solution for the problems surrounding trade: Impose tariffs and help domestic business make money.
Bill Kurtis joined the Federalist from the National Review Institute, where he was a Senior Fellow.