Herewith my letter. There is much more I could have added but letters have to be brief. Of the UK bank lending to business, over 80% is for construction with over 80% of that construction being in London and over [...]
Building a Wall to Stop Immigrants is the Last Piece of Infrastructure the USA Needs.
Republican Presidential Nominee apparent for the 2016 election (unless the Republicans can depose him at their convention) Billionaire property tycoon Donald Trump as part of his electioneering bravado has promised to construct a wall along the Mexican border to stop illegal immigrants from entering the US.
The May 2014 blog referred to the perilous state of infrastructure in the world’s largest economy and 2 years later the issue is on the list of promises from both Trump and Hilary Clinton the Democratic Nominee to fix once elected. Clinton wants $275 Billion spent on infrastructure while Trump, who want to cut taxes and increase spending, want to create both jobs and renew infrastructure with a major projects programme without stipulating, “any detail on how to pay for them”, (FT, 2016).
However, the American Society of Civil Engineers estimates a requirement of $1.44 Trillion for infrastructure spending in the years 2016-2025 or a whopping $4 Trillion will be lost in GDP due to costs rises and impeded productivity.
Clearly, a lot needs to be done and quickly with both public and private sector involvement which is happening, albeit slowly, with individual states pushing tax raising measures petrol taxes and private sector P3 deals, “providing funding for construction and maintenance for a slice of the revenue”, (FT,2016). However, Congress through the political tensions of raising taxes has resisted President Obama’s infrastructure spending efforts.
The USA needs to do this work to keep the country functioning and in market parlance and after the recent film of the book by Michael Lewis if US housing in 2006 was the big short then infrastructure in 2016 has to be the lengthy long.
Whilst maintaining a long position is relatively easier than a short nevertheless holding construction, building materials or equipment companies for the long term is risky as profit margins are tight and business cyclical due to government electoral terms and being at the mercy not just of market turmoil but the whims and fancies of politicians too. Any film about the lengthy long will be made over the long term and hopefully using plenty of private sector involvement of the P3 kind too.
As for the Presidential hopefuls let them commit to building the critically needed projects as soon as possible and not any fanciful populist follies.
Financial Times; (2016); “US: Neglected Nation”, by Sam Fleming, FT Big Read, Financial Times London, UK. Website accessed 25th May 2016:
Little Deal Clincher, (2014), “Fix Your Infrastructure, Stupid,” by Little Deal Clincher, Edinburgh, UK. Accessed 25/5/2016: