President-elect Donald Trump’s nominee to head transportation policy delivered a strong endorsement at her confirmation hearing of his proposal to seek private investment funding for a massive infrastructure building program based on a "bold new vision."
Elaine Chao, the immigrant who rose to become a cabinet secretary in a previous Republican administration and is now being considered for secretary of transportation, said deteriorating roads and other networks are jeopardizing the economy.
“I look forward to working with you to rebuild, refurbish and revitalize America’s infrastructure, so our economy can continue to grow, create good paying jobs for America’s working families and enhance our quality of life,” Chao said at the hearing on January 11.
While she stopped short of specifics such as how large the building program would be, she made clear she endorses Trump’s vision of relying on private money to pay for it so it won’t increase the deficit. Such so-called public-private partnerships typically rely on tolls or fees for new roadways, bridges and tunnels, generating revenue to allow investors to make a profit. Investors may also receive a tax break.
“As we work together to develop the details of President Trump’s infrastructure plan, it is important to note the significant difference between traditional program funding and other innovative financing tools, such as public-private partnerships,” she said. “In order to take full advantage of the estimated trillions in capital that equity firms, pension funds and endowments can invest, these partnerships must be incentivized with a bold new vision.”
Chao received an unusual introduction, signaling that she will likely face one of the easiest confirmations of any Trump nominee. Her husband, Senate Majority Leader Mitch McConnell, made a rare appearance at the Senate Commerce, Science and Transportation Committee to recommend her.
Quoting another former majority leader, Bob Dole, whose wife Elizabeth Dole served as Transportation Secretary, McConnell said:
“I feel a little bit like Nathan Hale. I regret that I have but one wife to give for my country.”
Moments later, in her own introductory remarks, Chao said: “I will be working to lock in the majority leader’s support tonight over dinner.”
Trump has promised to improve roads, bridges, airports, schools, electrical grids and other infrastructure to meet needs and boost the economy. Some of those areas are outside the Transportation Department’s purview.
During his Nov. 9 victory speech, he vowed, “We’re going to rebuild our infrastructure, which will become, by the way, second to none. And we will put millions of our people to work as we rebuild it.’’
Chao, 63, was born in Taiwan and moved to the U.S. at age 8, three years after her father came to this country to establish a maritime shipping company. She received an MBA from Harvard University and has held a number of posts in government, including secretary of labor under President George W. Bush.
She is no stranger to the nomination process and is considered unlikely to face strong opposition. She has been confirmed by the Senate for previous posts and has testified before congressional hearings dozens of times.
As chief of the Transportation Department, she would play a key role in Trump’s infrastructure plan.
The president-elect has not said precisely what his proposal will be or when he will offer it. Steve Mnuchin, Trump’s nominee for treasury secretary, has suggested an infrastructure bank. An Oct. 27 paper by advisers to Wilbur Ross, the nominee for Commerce Department secretary, and Peter Navarro, named to lead a new White House National Trade Council, called for creating a government tax credit to help spur $1 trillion in private investment over 10 years.
Some Democrats, including Senate Minority Leader Chuck Schumer of New York, have said they would be willing to work with Trump on infrastructure. Conversely, some fiscally conservative Republicans have been cooler to the idea.
Chao called the Trump plan “ambitious, futuristic and comprehensive” and said she plans to start a task force to begin work on it as soon as she’s confirmed.
Senator Bill Nelson, a Florida Democrat, urged her to provide details of the infrastructure plan as soon as possible, asking if she could promise to brief the committee within 30 days. Chao said she would try to meet that deadline, but couldn’t promise. She did say the administration needs bipartisan support to make an infrastructure plan work.
“We cannot do it alone,” she said.
Questioning from both Republican and Democrats wasn’t contentious and Chao took pains not to lock herself into any controversial positions. Instead of detailed policy discussions, her frequent reply to lawmaker inquiries was simply, "I look forward to working with you." She sidestepped questions on greenhouse gas policy and auto mileage standards, for example.
While the hearing lacked any confrontations, some environmental and labor groups oppose her nomination.
“Elaine Chao has made her career attacking unions, hamstringing government and pushing privatization,” Ben Schreiber, senior political strategist Friends of the Earth, said in a press release. “She is the perfect pick for a kleptocrat like Donald Trump who seems determined to cash in on public office. Chao will clearly put polluter profits above the American people.”
Chao may also play a role in a proposal by House Republicans to spin off the Federal Aviation Administration’s air-traffic division into a nonprofit corporation. The proposal died last year in the Senate.
When asked her position on the issue by Nelson, who opposes it, she said: “I’d like to get confirmed first.”
There needs to be a “national consensus” before moving forward on air traffic and the Trump administration hasn’t yet decided where it stands, Chao said.
Proponents of such a plan say that most other developed countries, including Canada and the U.K., have created a similar arrangement and it has helped speed the adoption of new technology. Such a system funded by user fees would provide more stable funding than the existing government agency, which was subject to automatic cuts known as sequestration, they say.
Opponents, including many Democrats in Congress, argue that the House plan would give too much control over a new system to airlines, the government should maintain control over aircraft because of national security concerns and the existing U.S. system is not broken.
She also vowed to make it easier to get approvals for transportation construction projects, and said she would work with industry on burgeoning new automation technology in self-driving vehicles and unmanned aircraft.
“We want to work with Congress to position the federal government as a catalyst for safe, efficient technologies, not as an impediment,” she said.
Chao repeatedly cited safety as her top priority as she steers policy on issues such as roadways, where fatalities have increased, and the adoption of new autonomous driving technologies.
On the new administration’s commitment to buying American-made products, Chao said Trump “has made very clear that this is his policy” and she and other cabinet members would follow it.
By Alan Levin