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highyields
Senior Contributor

Infrastructure rebuilding with bonds

I believe it was on another site but they did a poll about how people in ag wanted to fund the rebuilding of infrastructure in the US. 

Well one idea was to use gas tax,   which here in nebraska we already have gas tax, and then a tax on that tax, so in my opinion gas tax is a bad way to go. 

Why not issue a series of bonds that people can park their money in, set the interest rate high enough 4 or 5% so these guys that are getting close to retirement can place some money in something other then a 1% IRA somewhere, or risk it in the stock market.   I don't know why you couldnt' set the bonds up so it was similar to what the HH bonds where years back.  that you get the interest  yearly.   

 

Just a thought, I imagine theres red tape involved with something like this, probably enough to tape over an elephant.  But we can't set by and allow the USA to fall behind the rest of the world.  For those of us that have never seen a third world country wait a few more decades, cause it'll be here.  

I'm not for sure who actually owns all the locks and what not on the Mississippi system but the highways and bridges are either state or federal funded, or a combination of both so I really can't see why a bond program on a federal level wouldn't work.    

Our county has started doing the bonds to replace bridges since the bridges are in such poor shape, the former politians didn't keep up with demands, instead of fixing or replacing they just closed the roads. 

They have no problem selling the bonds.  

 

 

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32 Replies
Kay/NC
Honored Advisor

Re: Infrastructure rebuilding with bonds

From what I understand, muni bonds are hard to buy into reight now, as they are about the best game in town, at least for the foreseeable future.  I hold a few, and wish it was more.  Added bonus is tax free status on many of the on the interest.   

 

Also, withhte downgrading of ratings, some pension funds and foundations are goingto have to find new places to invest...they are restricted to only AAA rated issues, I think.  I(t will be intereesting to see how this gets done, or whether it gets done.  Some places have privatized roads adn bridges...which I think is a very bad idea, on the surface of it. 

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Nebrfarmr
Veteran Advisor

Re: Infrastructure rebuilding with bonds

The problem is the money STILL has to be paid back, and we don't have it.
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Jim Meade / Iowa City
Senior Advisor

Re: Infrastructure rebuilding with bonds

I'd prefer to raise taxes to using bonds, but I'm not hung up on it.

We should look more closely at shutting down infrastructre.  Not every bridge needs to be rebuild.  Not every park shelter has to be renewed.  We see a lot of money going into bicycle trails which benefit a few and very little into sidewalks.  Guess which one your mother stumbles on and breaks her hip?

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wt510151
Senior Contributor

Re: Infrastructure rebuilding with bonds

Here each property owner is responsible for the sidewalks in front of (or beside on corner lot) their house. If the sidewalk has been deemed to be hazardous, the property owner has the option of repairing/replacing it or allow the city to do it. If the city does it, the costs are then put on that specific property's tax lien.

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highyields
Senior Contributor

Re: Infrastructure rebuilding with bonds

Yes the money has to be paid back, But my thinking was that we could use the  "wealth" of the citizens to do this.  Instead of taxing the rich, use their money to back programs with.  and the thing with bonds is the idea that the money will come in, back to my own local situation I do not think that all the bridges need to be semi ready either,  Some low water crosses or cement culverts work fine with me as will.  But you do need "Heavy" bridges every so many miles in order to get around with the new combines, and trucks.

I often wondered about a toll road in the county.  I wondered if that would work out.  

 

 

 

by the way rich in my opinion is defined as "cash a plenty" .  

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kraft-t
Senior Advisor

Re: Infrastructure rebuilding with bonds

What do you mean we don't have it?

 

 Just because YOU don't want to pay for it doesn't mean we don't have it .What about the the bush tax cuts? Surely that put money in your pockets. That shows it desn't pay to cut taxes because nobody is better off anyway.

 

So what do you think about repairing the bridge  Are you just going to let it rot away or do you think it will cost less to fix it tomorrow? Or don't we need the bridge. Do you do the same thing with your tractors or combine/ Just run it until it drops?

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kraft-t
Senior Advisor

Re: Infrastructure rebuilding with bonds

Borrowed money has to be repaid no matter who it is borrowed from. Taxing the rich is about tax fairness. You run your operation and work hard to make a buck and you get taxed on it at ahigher rate than those taxed on capital gains. Are you somehow more able to pay because your income is earned by working and is capital gains income more sacred?

 

I didn't lobby for such a disticntion in the tax code. Did you? Do you suppose wall street did? I didn't lobby for businesses to take !00% fast write off on machinery instead of depreciating it as the depreciation actually occurs. Who did lobby for that?

 

And then they wonder why people are taking to the streets in our cities to protest the outrageous political influence that corporate amercia buys in our government.

 

WE have had a war on working folks since 1980 and the Reagan revolution. REpub after repub are fighting against unions and minimum wage laws in a direct effrort to keep labor cheap. Plus the rig the tax code toi benefit business and the stock holders while labor works with stagnant pay scales and the "players" are accumulating vast wealth.

 

Yeah it is time for people to take to the streets.

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Nebrfarmr
Veteran Advisor

Re: Infrastructure rebuilding with bonds

I see that here, too.  People come to the board meetings, usually spouses of the board members, and their neighbors, and want money for some new bike trail, or walking track, etc, etc.  They seem to find the big $$$ for that, but when I take my kids to the park, some of the playground equipment is in such disrepair, it is almost a danger.  Swings with cracked boards, seesaws the same, merry-go-rounds that sit crooked, outdoor bathrooms with cracks in the walls between the boards (better ventilation, maybe??).  That sort of thing gets neglected.  I guess the biggest reason is that the guy who puts new boards on the swings, or levels the merry-go-round doesn't get his picture in the paper, or a big plaque saying, 'Joe Smith Memorial Bike Trail' on it.

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Nebrfarmr
Veteran Advisor

Re: Infrastructure rebuilding with bonds


@kraft-t wrote:

What do you mean we don't have it?

 

 

Just what I said:  we don't have it.  Last time I checked, there was still some debt owed by  the federal government.  Unless someone paid it off without me hearing about it, I believe the country is still in the hole, and losing ground every day.  If we are suddenly running surpluses, again, I apologize for not being better informed. 

 

 Just because YOU don't want to pay for it doesn't mean we don't have it .

 

Show me ANY response I ever made to ANY post, that says I don't want to pay for infrastructure repairs.  If you actually look back at my past posts, I believe my stance on the first jobs bill, was that instead of extending unemployment blindly, put people to work fixing bridges, and filling potholes.  Instead of bailing out bankers who give themselves big dollar bonuses, re-pave the streets.  I believe I have made it perfectly clear where I would have spent an extra Trillion dollars, instead of where it went.  Now, we have one and a half trillion dollars piddled away, with unemployment as high as ever, and bigwig bankers and Wall Street traders the ones who raked it in.  If we still have that 1.5 trillion that was wasted, please tell me where it is, because again, I must be uninformed about where the government put it.

 

What about the the bush tax cuts? Surely that put money in your pockets.

 

Probably less than you think.  In fact, I'd be willing to bet, you got 3-5X the benefit in terms of dollars, than I did, or more.  I am just getting started in life, and haven't been working long enough to have been able to get the cuts every year they were in force.  Blaming problems on something that happened 10 years ago, doesn't do anything to solve the problem.  It is just carping.  Unless you have a time machine, and can go back and stop the cuts from being enacted, all we can do is move forward from here.  Last time I checked Bush was no longer President.  There isn't much he can do any more at this point.

 

 That shows it desn't pay to cut taxes because nobody is better off anyway.

 

I distinctly remember, in several posts, where you have commented that you are doing quite well, and aren't paying enough in taxes in relation to your income, so apparently, it must have not harmed you much. 

 

 

So what do you think about repairing the bridge 

 

Depends on the bridge.

 

 Are you just going to let it rot away or do you think it will cost less to fix it tomorrow? Or don't we need the bridge.

 

I can name a few bridges in my area, that are completely un-necessary, and actually  would be a benefit to be rid of.  Why spend millions of dollars, to fix a bridge, that only a few people use, when a newer, safer, stronger bridge is less than a mile away, and doesn't see that much traffic, either.

 

Do you do the same thing with your tractors or combine/ Just run it until it drops?

 

Well, I certainly don't just take it to the mechanic, and say 'fix it', no matter what is wrong. 

I never said we shouldn't fix infrastructure.  I just don't know about a bond being the way to go about doing it.  Right now, the Fed interest rate is cheap.  Why would you borrow money at 5%, when you already have an account for under 2%?  If there is no money for this now, what makes you think the government will suddenly become fiscally responsible, and save for it in the future?  It still needs to be paid back, and I still don't know where the money will come from.

 


 

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