Hillary’s Economic Plan: Spend, Spend, Spend

Hillary Clinton appeared at a rally in Iowa Wednesday to tout her plans to create high-paying jobs — but it largely consisted of government spending on public works projects and more unionization.

And, of course, a few obligatory shots at Donald Trump.

“They take years to get off the ground. There are extensive reviews. Modern infrastructure projects don’t rely on low-skilled labor.”

“We will make the biggest investment in good jobs, good-paying jobs, since World War II,” she said at Lincoln High School in Des Moines.

Clinton promised a vigorous campaign in her first 100 days to spend money on roads, tunnels, ports, and airports. She also vowed to invest money in green energy projects to create a “modern electric grid to take the clean renewable energy that is produced in places like Iowa and make sure it can be distributed where it can be used.”

The unmentioned flaw in the plan is that infrastructure spending has a historically poor record of boosting long-term economic growth, according to some experts. And if the 2016 election comes down to contest between which candidate will spend the most money on transportation projects, Trump is likely to win. In his book, “Crippled America,” he proposed spending as much as $1 trillion on such projects. Clinton mentioned no numbers on Wednesday, but her campaign website proposes $275 billion over five years.

“Both candidates have embraced this kind of big spending on infrastructure, because it makes good politics,” said Michael Sargent, a researcher at The Heritage Foundation.

But Sargent said that as President Obama found out when he pitched his own massive public works plan to revive the economy in 2009, spending on roads, bridges, and other projects takes too long and mainly benefits high-skilled workers who are already working.

“They take years to get off the ground. There are extensive reviews,” he said. “Modern infrastructure projects don’t rely on low-skilled labor.”

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According to the Associated General Contractors of America, construction employment is up 3.3 percent this year, nearly double the increase in total payroll. Wages are up to 10 percent higher than the private sector average.

“Several indicators show that there is still plenty of construction work available, but the shortage of experienced workers is growing ever more acute,” association chief economist Ken Simonson said in a statement earlier this month.

Sargent said smart spending can lay the groundwork for future economic growth, as Clinton argues. But he said too often priorities are set by political considerations that have little to do with actual needs. He said it is unlikely infrastructure will produce the kind of sustained growth the construction of the interstate highway system did in the 1950s.

“The problem is that the low-hanging fruit is already gone,” he said.

And while Clinton was promising hypothetical “green energy jobs” in Iowa, Trump was in Virginia Wednesday promising to save existing coal jobs.

In her Iowa remarks, Clinton blasted “trickle-down” economics and painted a picture that largely ignores that her party has controlled the White House for the last eight years.

“What we’ve been seeing in recent years is a deliberate effort to undermine the middle class,” she said.

In addition to infrastructure and unionization, Clinton promised to push to increase the minimum wage so that “it no longer is a starvation wage.” Conservative economists have noted, however, that raising the minimum wage is an ineffective way to fight poverty since most people who earn it are not poor. Most are either teenagers in middle-class families or second-income earners.

Clinton cited a study claiming her plan would create 10.4 million jobs, while Trump’s would cost 3.5 million jobs. But she had nothing to say Wednesday about taxes, trade policy, or profits earned overseas by American businesses that do not want to pay a high penalty for bringing them to the United States. Trump discussed those issues in detail in his economic address in Detroit Monday.

Trump also called for a temporary moratorium on regulations and a review of existing rules that he argues are strangling economic growth. Ignoring tens of billions of dollars’ worth of new regulations imposed by the Obama administration, Clinton criticized an approach that she said has been to “get out of the way” of corporations.

“That didn’t work out so well, did it,” she said.

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Of course, there were plenty of broadsides against Trump — from Clinton and other Democrats who took their turn at the podium. She declared herself in favor of small business.

“That’s a big contrast with Donald Trump, who has spent his career stiffing small businesses,” she said.

Democrats talked out of both sides of their mouths. Iowa State Sen. Matt McCoy: “We reject the politics of fear.”

Iowa congressional candidate Jim Mowrer, the very next speaker, said: “I know that Donald Trump cannot be commander-in-chief. This is someone who cannot be trusted with the nuclear codes … His election would imperil the future of our country and the entire word.”

It’s a good thing that Democrats reject the power of fear.

Undeterred by polls showing widespread doubts about Clinton’s truthfulness, former Sen. Tom Harkin called her “one of the most honest, trustworthy, patriotic, caring, competent public servants we have ever known or worked with in our entire lifetime.”