On August 3, 2014, the first cars drove the new and much-needed Port of Miami Tunnel. The project broke ground in 2010 and was intended to ease congestion in downtown Miami.
What set this project apart from others is the way it was financed – through a so-called “public-private partnership” (P3) – in which a consortium of private investors provide financing for projects and are repaid by a state or local government over time.
Traditionally, infrastructure projects have been largely funded by the federal government through grants to states, which in turn pass funding on to localities. Until recently, P3s have largely stayed in the background, accounting for just a small fraction of total infrastructure financing.
But projects like the Port of Miami Tunnel are likely to be more commonplace as cash-strapped governments look for other resources to replace crumbling infrastructure.
Yesterday’s airstrikes on Islamic State and other terrorist targets in Syria yield five important lessons about America’s long war against Islamist extremism:
First, Syria has become a haven for jihadist terrorism. The United States and its allies struck the IS headquarters in Raqqa and other targets along its supply lines into Iraq. U.S. forces also hit the Aleppo base of the Khorasan Group, a gang of al Qaeda veterans whose mission is to stage terrorist attacks against Western targets, including civilian airliners. As both Hillary Clinton and Leon Panetta have suggested, early and effective U.S. support for indigenous Syrian rebels might have prevented these foreign jihadis from setting up shop in Syria. Non-intervention is not a painless or risk-free option for Americans, no matter how weary we may be of war.
Second, the administration deserves credit for assembling a regional alliance with Sunni Arab states. Forces from Saudi Arabia, Jordan, the United Arab Emirates and Bahrain participated in yesterday’s strikes, while Qatar offered political support. This underscores both that the United States is not taking sides in a Shia-Sunni civil war, and that moderate Sunnis are taking responsibility for confronting violent extremists in their midst.
Third, the Islamic State can be degraded from the air, but ultimately must be defeated on the ground. Air attacks can buy time for the United States and its allies strengthen Iraqi forces and the Free Syrian Army so that they can eventually drive IS out of their countries. A critical question is whether other regional partners can be induced to contribute to the fight on the ground.
Fourth, President Obama needs to level with the American people about the nature and duration of this conflict. What we are really up against, the enduring source of instability and danger, is not any particular group of Sunni terrorists, but the Islamist ideology that motives them. This fight will be more like the Cold War than World War II. It won’t be settled on any battlefield. Only when the jihadist ideology loses its power to inspire young Muslims to kill for a warped vision of a puritanical, all-conquering Islam will the danger pass. That could take a generation. It will require that America and the international community wage – and above all Muslim political and religious leaders – wage a more effective campaign to discredit and marginalize the Islamist death cult.
Fifth, a resolute, long-term strategy to contain and eventually defuse the threat posed by Islamist fanatics must enjoy broad public and political support at home. Rather than invoking post-9/11 legislation, the White House should heed calls from Congressional leaders, such as Sen. Tim Kaine, to seek new authority for this next phase of U.S. counter-terrorism operations. It’s important that our confrontation with Islamist extremists have explicit Congressional backing and be unequivocally Constitutional. At the same time, however, Congress must refrain from tying the executive’s hands, for example, by imposing arbitrary deadlines or geographical limits on its ability to confront threats to our people or our interests.
PPI Senior Fellow Paul Weinstein talks with MarketWatch’s Adrienne Mitchell on how switching to three-year programs will help solve the college-debt crisis.
Vice-President of the European Commission Neelie Kroes and U.S. Under Secretary of State Cathy Novelli at “Growing the Transatlantic Digital Economy.”
The Progressive Policy Instiute hosted an event with The Lisbon Council last Friday aimed at finding ways to grow the transatlantic digital economy. With both sides of the Atlantic, particularly Europe, facing a slow economic recovery and even the prospect of secular stagnation, a thriving digital economy and transatlantic trade can spur much-needed growth and job creation.
“I want to thank PPI for what they have done to try to put facts around the Internet economy,” said Under Secretary Novelli. “I think one thing we [politicians and policymakers] have to do is ground what we do in facts. It is a fact that a thriving transatlantic digital economy is critical to economic growth and shared prosperity.”
“We can work together in so many areas to enjoy this digital boost; constructively collaborating to make this platform work across the Atlantic,” said Vice President Kroes.“That is my dream – a transatlantic digital single market.”
US-European Union merchandise trade totaled an estimated $787 billion (€598 billion) in 2013—double the level of 2000. Yet, often overlooked is the importance of trade in data, which is now the fastest-growing segment in transatlantic trade. Digital technologies are profoundly shaping and accelerating transatlantic commerce, a trend which has led to calls to include a “digital chapter” in the ongoing negotiations for TTIP.
“The more open we are; the more we will benefit. Within the EU, and within the US; but also between the two continents,” said Vice President Kroes. “That is partly about removing barriers to trade, and opening up markets at all levels. That is what TTIP—the transatlantic trade and investment partnership—is all about. And that will need to have a strong digital component.”
This necessitates, however, finding common ground on difficult issues surrounding cross-border data trade, government surveillance and privacy concerns, data localization and data protection, as well as an improved framework for Internet governance.
The event marked the third collaboration between the Progressive Policy Institute and the Lisbon Council. PPI has traveled to Brussels for two previous engagements regarding the rise of the data-driven economy, digital trade, and what the prospect of barriers to digital trade could mean for economic growth on both sides of the Atlantic. At this event, PPI and the Lisbon Council released an update of the European data gap numbers from a joint report, “Bridging the Data Gap: How Digital Innovation Can Drive Growth and Create Jobs,” authored by PPI Economic Strategist Michael Mandel and the Lisbon Council President Paul Hofeinz in April 2014.
In an article for The Telegraph regarding U.S. efforts to clamp down on tax “inversions,” PPI Chief Economic Strategist Michael Mandel is quoted on how such efforts might backfire:
Michael Mandel, chief economist at Progressive Policy Institute, the Washington think tank, said the new rulebook gives activist investors a “roadmap” that “is likely to turn US-based multinationals into hunted prey, selling out to foreign rivals”.
“The anti-inversion legislation does nothing to fix the underlying problem, which is the incredibly weird and broken US corporate tax system,” he said when the plans were first proposed.
“Instead, the legislation encourages activist investors and foreign companies to work together to make takeover bids for US multinationals with large amounts of cash outside the country. No company, no matter how large, would be safe.”
Americans seem to have a love-hate relationship with major energy companies. On the one hand, our iconic brands are global leaders and symbols of U.S. technological and economic prowess. On the other hand, Big Energy takes the heat when the public gets restive over rising gas prices, or there’s an extended power outage.
A new Progressive Policy Institute (PPI) report highlights an underappreciated fact about energy companies—they are huge investors in the U.S. economy. In fact, along with telecoms and Internet-based businesses, they are leading our economic recovery.
Each year, PPI economists Michael Mandel and Diana Carew rank America’s top 25 “Investment Heroes”—the U.S. companies (excluding finance) that are making the biggest capital investments in economic innovation and jobs here at home. This year’s report shows that 10 U.S. energy companies made the list. These companies, involved in the exploration and production of oil and gas, or in energy distribution and power, invested a total of $57 billion in domestic capital expenditures last year. That figure represents 37 percent of the $152 billion that all 25 companies pumped into the U.S. economy in 2013. The energy companies on the list included many household names—Exxon (3), Chevron (4), ConocoPhillips (8), Exelon (10), and Duke Energy (11). But some lesser-known firms made the cut too, including Energy Transfer Equity (16), Enterprise Product Partners (18), and FreeportMcMoRan (24). All are helping to spur America’s energy transformation by investing in the nation’s shale oil and gas boom.
The American higher education system is the finest in the world. Our universities and colleges are unmatched, and we have more highly rated schools than all of our competitors combined. Students from across the globe continue to flock to American universities, while the competition among U.S. students for slots at our elite schools is tougher than ever.
What’s more, since end of World War II access to college has grown substantially as more and more young people pursue the dream of earning a college degree. Enrollments at U.S. colleges and universities has more than doubled since the 1980s, and the number of bachelor degrees awarded over the same time has grown by more than 75 percent.
For most graduates, a college degree remains the key to financial success. Even after the economic collapse of 2008 and the ensuing Great Recession, income and wealth for those holding a college degree has outpaced those without. Among those currently aged 25 to 32, median annual earnings for full-time working college-degree holders are $17,500 greater than for those with only high school diplomas. The earnings premium enjoyed by college graduates has risen for each successive generation since the latter half of the 20th century. By way of illustration, in 1979 the gap for that same age cohort was far smaller at $9,690.
But there are cracks in the fiscal foundations of higher education, and they are growing wider. Like a water leak in the ceiling, the problem is getting bigger and the damage is getting more expensive to fix each year we do not act.
The problem is money—specifically the ever-growing pile of cash students need to pay for college and graduate school.
PPI President Will Marshall contributed his views to CNN following President Obama’s recent speech that addressed the threat posed by the Islamic State of Iraq and Syria (ISIS).
President Obama’s speech was a characteristic exercise in foreign policy minimalism. He said just enough to convince the public he has a plan to defeat the Islamic State. But he said virtually nothing about how to win the long war against Islamist extremism that began 13 years ago tomorrow.
“There’s no doubt the president answered his critics tonight. They’ve demanded a strategy for rolling back the Islamic State; he gave them a plausible one. They’ve accused him of sounding America’s retreat from global leadership; he highlighted Washington’s catalytic role in orchestrating the world’s response to ISIS’s murderous rampage, Russia’s aggression against Ukraine, and the Ebola outbreak. “American leadership is the one constant in an uncertain world,” he affirmed.
“The speech seemed calculated to shore up the public’s sagging confidence in Obama’s stewardship of U.S. foreign policy, and perhaps it will boost his numbers. Donning the mantle of Commander-in-Chief, he conveyed resolve in confronting the Islamist terrorists, while at the same time he was careful not to cross his own red line against reintroducing ground troops in the Middle East. That’s a stance exquisitely calibrated to fit the public’s current mood.
“What was missing, however, was an account of where ISIS came from and how it grew so strong. The president neither defended nor offered second thoughts about his decision to disengage from Iraq and the Syrian civil war. Nor did he explain why demolishing al Qaeda has failed to turn the tide of battle against Islamist extremism, as he had hoped. About the ideology that motivates our enemies, he said nothing at all, except to deny it’s really Islamic. He devoted all of one fleeting sentence to the need for America and the international community to more effectively counter the jihadist narrative that inspires young Muslims from Europe as well as the Middle East to commit atrocities in Islam’s name.
“However politically effective speech proves to be, it was strategically vacuous. At some point, the president needs to focus on the larger war we’re embroiled in, not just the next battle.”
The Washington Post quoted PPI Chief Economic Strategist Michael Mandel in a story mentioning PPI’s newest report, U.S. Investment Heroes of 2014: Investing at Home in a Connected World:
For a more optimistic one, look inside one more report out this week, from the Progressive Policy Institute. It lists the 25 companies that invested the most in capital improvements in America last year, led by AT&T and Verizon. Most of the companies on the list come from the telecommunications sector, the energy sector or the tech sector – all areas where American minds have engineered big breakthroughs in recent years.
“The investments have followed the innovations,” one of the report authors, Michael Mandel, said in an interview. Jobs, he added, have followed the investments. So if you spur more innovation, you’ll spur more jobs.
PPI Senior Fellow Hal Singer was quoted in a story by WJLA Channel 7 regarding yesterday’s Internet Slowdown Day, a protest organized by net neutrality advocates unhappy with new Open Internet rules being proposed by the Federal Communications Commission:
Hal Singer, senior fellow at the Progressive Policy Institute, supports the FCC proposal. He says, “Fast lanes is a loaded term. What I prefer to say is ‘just say no to slow lanes.’”
He continued, “It’s a political campaign. These guys on the other side are very effective at this game. They would like all of these priority delivery offerings to be available for free. Well, that’s very convenient for them. I say, on the other hand, if you don’t want the priority delivery offering, it’s a free country. You can always decline it.”
Singer says – for the average small business or Internet start-up – there’s no demand for such high-speeds. Meanwhile, major telecom firms point out video traffic consumes enormous bandwidth and costs more. And they warn that treating broadband like a utility would harm innovation.
“We’re going to freeze the current technology in place,” Singer said. “And that’s not good for anyone, particularly Internet consumers, because we’re going to keep coming up with new fancy applications that we want and who knows what kind of speeds are required to support those applications.”
It’s no small irony that President Obama, who had hoped to earn his Nobel Peace Prize after the fact by ending America’s wars, will speak to the nation tonight about his plans to escalate one.
At first, Obama dismissed the Islamic State as the “JV team” of terrorism. Now, he vows to “degrade and destroy” this rampaging army of Sunni fanatics. Tonight, he’ll explain why he’s decided that crushing the Islamic State “caliphate” is essential to U.S. security and how he intends to do it.
But that’s not enough. Tomorrow, Sept. 11, marks the 13th year of America’s confrontation with Islamist extremism. Our country needs a long-term strategy for victory in this longest of wars. Six years into his presidency, however, the president has yet to devise one. Instead of steeling Americans for the struggles that lie ahead, he’s assured them that “the tide of war is receding.”
This has turned out to be an illusion. Americans can’t end wars unilaterally—our enemies get a say, too. And though it’s difficult for him, the president also should admit tonight to having made another big mistake. This was to assume that smashing al Qaeda—presumably the jihadists’ Varsity team—would close the book on the “war on terror.” By focusing narrowly on “the group that attacked us on 9/11,” the United States could settle accounts with al Qaeda without fanning the flames of Islamist extremism.
Multichannel News quoted PPI Senior Fellow Hal Singer accompanying the release of PPI’s newest report, U.S. Investment Heroes of 2014: Investing at Home in a Connected World.
“Given the importance of broadband investment to the U.S. economy, the social costs of imposing rate regulation under Title II will be even larger than the immediate harms to broadband consumers from an atrophying network; growth in U.S. productivity and job formation could be slowed,” said senior fellow Hal Singer in a statement.
“Given the importance of broadband investment to the U.S. economy, the social costs of imposing rate regulation under Title II will be even larger than the immediate harms to broadband consumers from an atrophying network; growth in U.S. productivity and job formation could be slowed,” said senior fellow Hal Singers in a statement – See more at: https://www.multichannel.com/news/policy/comcast-twc-list-top-capital-spend/383702#sthash.2C5Yd5yy.dpuf
“Given the importance of broadband investment to the U.S. economy, the social costs of imposing rate regulation under Title II will be even larger than the immediate harms to broadband consumers from an atrophying network; growth in U.S. productivity and job formation could be slowed,” said senior fellow Hal Singers in a statement – See more at: https://www.multichannel.com/news/policy/comcast-twc-list-top-capital-spend/383702#sthash.2C5Yd5yy.dpuf
“Given the importance of broadband investment to the U.S. economy, the social costs of imposing rate regulation under Title II will be even larger than the immediate harms to broadband consumers from an atrophying network; growth in U.S. productivity and job formation could be slowed,” said senior fellow Hal Singers in a statement accompanying release of the report. – See more at: https://www.multichannel.com/news/policy/comcast-twc-list-top-capital-spend/383702#sthash.2C5Yd5yy.dpuf
In this era of globalization, goods, services, money, people, and data all cross national borders with ease. Indeed, connectedness to the rest of the world is now essential for the data-driven economy we find ourselves in to thrive. It follows that our tax, trade, immigration, and regulatory policies must be oriented to encourage that connectedness.
But perhaps paradoxically, prospering in a connected world requires a dedication to investing at home. It is impossible to participate as a full partner in the global economy unless we are investing in digital communications networks, education, infrastructure, research, energy production, product development, content, and security domestically. Investment generates increased productivity, higher incomes, new jobs, and more opportunities for the economic mobility and growth that we all desire.
Such prosperity-enhancing investment comes in many flavors, both private and public. In this report, we focus on identifying the U.S.-based corporations with the highest levels of domestic capital expenditures, as defined by spending on plants, property, and equipment in the United States. Currently, accounting rules do not require companies to report their U.S. capital spending separately, although some do. We fill in this gap in available knowledge using a methodology outlined at the end of this paper, based on estimates derived from published data from nonfinancial Fortune 150 companies.
To understand which companies are betting on America’s future, we rank the top 25 companies by their estimated domestic investment. We believe this list can help inform good policy for encouraging continued and renewed investment domestically.
PPI Releases Third Annual Report Ranking U.S. Companies Investing in America’s Future
Top 25 American Companies Invested More Than $150 Billion In The U.S. Last Year
WASHINGTON—Which U.S. companies are betting on America’s future? The Progressive Policy Institute (PPI) today released U.S. Investment Heroes of 2014: Investing at Home in a Connected Worldranking the top 25 American companies by their capital spending in the United States. For the third year in a row, AT&T was at the top of the Investment Hero list with $20.9 billion in domestic capital spending in 2013, followed by Verizon, Exxon Mobil, Chevron, Walmart, Intel, and Comcast.
The report, based on an exclusive PPI methodology, also features a new 3-year cumulative capital expenditure list. The top company, AT&T, invested more than $60 billion in the U.S. over the past three years. The top ten companies combined invested $293 billion in the United States from 2011 to 2013.
Authored by PPI Chief Economic Strategist Michael Mandel and Economist Diana Carew, the report focuses on identifying the U.S.-based corporations with the highest levels of domestic capital expenditures, as defined by spending on plants, property, and equipment in the United States. PPI believes this report can help inform good public policy for encouraging continued and renewed investment domestically.
“Investment generates jobs, greater productivity, and the higher incomes Americans desire,” says PPI Chief Economic Strategist Michael Mandel. “Companies that invest in the U.S. are creating more opportunities for economic mobility and growth, and our government should implement policies that continue to encourage these companies to invest here at home.”
Overall, the top 25 ranking contains four telecom and cable companies, with a total of $46 billion in domestic capital spending. The next highest category in terms of investment is energy production and refining, with six companies accounting for a total of $40 billion in domestic capital spending. The third largest category is Internet and technology companies, containing five companies totaling $22.7 billion. Together, our 25 Investment Heroes invested more than $152 billion in the United States in 2013, with the top ten companies alone investing almost $100 billion of the total.
Top 25 Nonfinancial Companies by Estimated U.S. Capital Expenditure in 2014
1. AT&T – $20.9 billion
2. Verizon Communications – $15.4 billion
3. Exxon Mobil – $11.1 billion
4. Chevron – $10.6 billion
5. Walmart – $8.7 billion
6. Intel – $8.4 billion
7. Comcast – $6.6 billion
8. ConocoPhillips – $6.3 billion
9. Occidental Petroleum — $5.5 billion
10. Exelon – $5.4 billion
11. Duke Energy – $4.8 billion
12. Google – $4.7 billion
13. General Motors – $4.6 billion
14. Hess – $3.9 billion
15. Apple – $3.8 billion
16. Energy Transfer Equity – $3.5 billion
17. Union Pacific – $3.5 billion
18. Enterprise Products Partners – $3.4 billion
19. Ford Motor – $3.4 billion
20. General Electric- $3.3 billion
21. Time Warner Cable – $3.2 billion
22. FedEx – $3.2 billion
23. Microsoft – $3.0 billion
24. FreeportMcMoRan – $2.7 billion
25. Amazon – $2.6 billion _______________________________________________
Total Economic Investment in U.S.: $152.5 billion
Join the conversation on Twitter: #InvestmentHeroes.
PPI Economist Diana Carew was quoted in a USA Today exclusive covering PPI’s newest report, U.S. Investment Heroes of 2014: Investing at Home in a Connected World. Carew co-authored the report with PPI Senior Economic Strategist Michael Mandel.
PPI economist Diana Carew says the government should promote faster capital spending growth and contributions from more industries through policies that encourage investment.
Last year, three sectors — telecommunications and cable, Internet and technology, and energy — accounted for 83% of the top 25 firms’ total investment.
“Policies need to make investment an explicit focus,” Carew says.
