WASHINGTON -- Speaking at an infrastructure conference on Tuesday, Democratic Senate candidate Tim Kaine of Virginia laid out his vision for achieving both deficit reduction and infrastructure growth.
"Cutting is incredibly important," he told the audience. "But I believe passionately that nobody's ever cut their way to prosperity."
Figuring out how to satisfy the current mania for deficit reduction while paying for infrastructure spending, which mainstream economists say would create jobs, may prove to be a difficult balancing act for Democrats seeking to paint themselves as centrists during this election cycle. Contrary to economists like Nouriel Roubini, Kaine believes that achieving both goals at once is possible.
The former Virginia governor distinguished between the "over-consumption strategy" that the United States pursued during the 2000s and "double-plus spending" that created long-term growth potential.
"We've got to at the national level acknowledge that the previous model -- the overspending, the deficits don't matter model -- that model has failed, and the consumption model has got to be replaced by an innovation and investment model," he said.
"Infrastructure's about spending, so why is that kind of spending good and other kinds of spending bad?" Kaine asked. "I call infrastructure spending a kind of double plus spending: it's double plus because in the short term, infrastructure spending is a job creator, but in the long term it raises your platform for economic success."
Asked by HuffPost about the American Jobs Act, Kaine, who was mostly recently the chairman of the Democratic National Committee, declined to state whether he would vote for President Obama's proposed economic stimulus bill if he were a member of Congress. That bill, which the Congressional Budget Office estimates would decrease the deficit by $6 billion dollars between 2012 and 2021, includes some $105 billion for infrastructure spending over the next two years.
"On the projects, I'm in good shape, but I have a different attitude on the pay-for," Kaine said, suggesting that he'd prefer the bill to be funded with a different provision. "I like to do the pay-for by Bush tax cut expiration at the top end."
Kaine also praised the infrastructure projects in Virginia funded by the Recovery Act as "very strong."
Before the conference, the consulting firm CG/LA Infrastructure announced the results of its survey of public- and private-sector executives. The survey measured infrastructure "vision" and compared it to countries around the world -- and apparently the United States is on par with Peru and well below countries like Brazil, India and China.
"If you talk to serious infrastructure guys and you ask them where would you rather go to bid on a project, they would say Peru," said Norman Anderson, CEO of CG/LA infrastructure. "Because projects in the US start and stop, nobody knows what they've been doing, and they just go on and on."
Democrats and Republicans in Congress continue to argue over how to pay for a new transportation bill to cover improvements to roads, rail and bridges. House Republicans would like to expand offshore oil drilling to pay for a long-term bill. The Senate would like to approve a shorter extension of the transportation bill that dips into the general fund to cover a structural shortfall in the gas tax revenues that traditionally paid for roadbuilding.
