Now that Donald Trump has secured victory in the U.S. presidential election, what does that mean for infrastructure investment and aggregates industry growth?
Late in the campaign, Trump introduced what he called “a bold, visionary plan for a cost-effective system of roads, bridges, tunnels, airports, railroads, ports and waterways, and pipelines in the proud tradition of President Dwight D. Eisenhower, who championed the interstate highway system.”
Trump’s plan, drafted by economic advisors Peter Navarro and Wilbur Ross, would finance up to $1 trillion in spending over a decade. The plan would rely heavily on private funding, with the government encouraging investment through a tax credit that would raise the return to investors and lower the cost of borrowing to states and municipalities that would oversee the projects. Tax credits would cost the government some money, but taxes collected from the workers and companies participating in such projects would offset the costs, according to Navarro and Ross.
“If there’s ever a great time to do it, it’s got to be now,” Ross, a billionaire private-equity investor, told Yahoo Finance. “With interest rates so low, this has got to be the best time from a break-even point of view, from a societal point of view.”
Then there is The Wall. Trump has said his proposed wall on the U.S.-Mexico border could cost up to $12 billion, but a Washington Post study estimated the wall would cost as much as $25 billion. It would be made of precast concrete and reach up to 50 ft. high. It is estimated that it would take 339 million cu. ft. of concrete to build.
Bottom line is, $1 trillion in infrastructure investment and 339 million cu. ft. of concrete translates into a lot of aggregate. Could either or both of these proposals actually come to fruition? Some experts and analysts believe it is wishful thinking. But even at lower levels of investment, the aggregates industry could be in for a golden era over the next decade.
“The National Stone, Sand and Gravel Association (NSSGA) is looking forward to working with President Donald Trump and members of Congress to turn campaign promises into real policy,” said Michael W. Johnson, NSSGA president and CEO. “Trump has continually stated his intention to invest up to $1 trillion in our country’s infrastructure and rebuild America’s roads, bridges and highways. He also promised to issue a temporary moratorium on new regulations that are not compelled by Congress and eliminate existing ones like EPA’s controversial Waters of the United States rule. Most importantly, we are very proud of the thousands of people from the aggregates industry who participated in our Vote Aggregates campaign. This is a great sign that our members are working to ensure that the aggregates industry’s voice will be heard in this and future elections so that lawmakers understand the value of our operations.”
“Associated Equipment Distributors (AED) and construction equipment distributors and manufacturers across North America look forward to working with President-elect Donald Trump and members of the next Congress on pro-growth policies to put the United States on strong economic footing for years to come,” said Brian P. McGuire, president and CEO. “There’s an immediate opportunity to rebuild our crumbling infrastructure, reform the nation’s tax code, develop the next generation of skilled workers and lower the cost of doing business for small companies. The voters have spoken and AED is standing by to work with members of both parties to create an economic environment that encourages job creation, growth, investment and entrepreneurship.”
“America’s voters have spoken, and on behalf of the Association of Equipment Manufacturers (AEM) and our more than 900 members, I congratulate President-elect Trump on winning the presidency after a long and hard-fought campaign this year,” said AEM President Dennis Slater. “The 2016 campaign made clear that Americans are tired of gridlock government and fatigued after an unrelentingly negative election. Our elected officials now need to soothe our political discourse by coming together to advance sound public policy that will drive job creation and economic growth.
“The good news is that this election campaign highlighted the many issues on which Americans are united, along with manufacturers. Both Hillary Clinton and Donald Trump made the case this election season as to why we must make a substantial effort to not only repair our existing infrastructure, but also to develop a long-term vision for U.S. infrastructure that accommodates economic growth and rapidly emerging technologies,” Slater said. “We stand ready to work with President-elect Trump to help advance this critically important policy priority.”
“President-elect Trump will have a ‘can do’ industry as his partner in rebuilding and expanding the nation’s transportation infrastructure to make it again second to none,” said American Road & Transportation Builders Association (ARTBA) President and CEO Pete Ruane. “Give us the proper resources and the new jobs and innovative solutions will take off. Republicans in Congress should heed the call of their party’s leader and make urgently-needed improvements of national infrastructure networks a top priority in early 2017.
“Despite a highly partisan political environment, Republicans and Democrats have routinely worked in a bipartisan manner to support infrastructure legislation,” Ruane said. “All sides should view a long-term infrastructure package as an opportunity for the two parties to come together and make meaningful progress for the American people.”