Exclusive — Base Politics: Infrastructure Pathway Would Reduce Deficit Without Gas Tax Hike by Auctioning Off Government Assets

Poorest Districts
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A pathway forward on infrastructure for President Donald Trump and Congress has emerged via a new bipartisan minority-owned public affairs firm, Breitbart News has learned, as members of both the Republican and Democratic Party on Capitol Hill are actively working to launch a different type of vehicle to fund an expansive rebuilding effort in America’s interior.

A plan crafted by Republican and Democrat members of the House of Representatives from the bases of both parties, with help from a new firm in Washington designed at its launch to foster ideas from the poles of the parties rather than the establishments of the parties, is expected to be introduced next week when lawmakers return from a President’s Day district workweek.

In fact, unlike a gas tax hike plan that the White House semi-embraced in the past week, this plan would not only not raise taxes or the deficit—it would cut into the deficit and pay for infrastructure.

The plan, which does not raise taxes or increase the deficit at all in order to pay for infrastructure, takes troubled government assets like buildings or debt and sells them off at auction to financial institutions—then turns around and spends the funds raised in the auction sales in two separate ways: Half the money would go directly into the United States Treasury to pay off part of the national debt, while the other half would be evenly distributed to infrastructure projects in the 100 poorest communities in America. Creating what’s known as a “pay-for,” a mechanism by which to fund infrastructure and deficit reduction in this way, isn’t entirely new: Ronald Reagan did something very similar back in 1986 to pay for tax cuts.

What’s more, unlike the current White House plan or others from Congress, this type of a plan could pass with significant bipartisan support in an election year like 2018—and get President Trump moving towards a significant infrastructure achievement before his party faces its first major national test at the polls since his inauguration in November. And given that the principles surrounding this infrastructure idea would require that the work on the projects created by the money doled out to those 100 poorest communities in America be conducted by people who actually live in those districts, it would function as a major jobs and economic booster plan in areas hardest hit in recent decades across America from inner cities– which benefits anti-establishment Democrats, to rural areas in the South, West, and Appalachia–which benefits anti-establishment Republicans.

The plan has its origins in the annals of a new bipartisan public affairs firm called “United By Interest,” which unlike any other firm in Washington is truly minority-owned—headed by several black and Hispanic Democrats as well as a handful of top D.C. Republicans.

“We’ve been spending most of our efforts on infrastructure and we’ve come up with a plan that mirrors the 1986 tax language that Reagan used in which they sold off distressed assets across several government agencies,” Sammy Geduldig, a top Republican lobbyist who joined the new firm United By Interest this month, said in an appearance on Breitbart News Sunday this weekend.

“Those assets were used to help pay for the cost of a tax bill. We took that idea and kind of made it political around what you would do with that found money. The way I like to describe it is if you talk about a gas tax, there’s been some conversation about taxing people at the gas pump… In Washington-speak, that’s a regressive tax that hurts the poorest people who can’t afford to pay that kind of money and it really kind of doesn’t hurt the wealthy congressional districts where people can more afford it. So you’re kind of punishing people that need the most help with this regressive tax, so we take that idea and we turn it on its head and we say let’s not go there, let’s try to do it in a different way and sell these assets off [to pay for infrastructure],” said Geduldig.

Geduldig is a Republican lobbyist with the all-GOP firm CGCN Group—and is one of if not the biggest givers of political donations to Republicans across the party from K Street. He worked for former House Speaker John Boehner before Boehner assumed the Speakership. He had a stint working for former Senate Majority Leader Bob Dole, the 1996 GOP presidential nominee, and also worked for Sen. Roy Blunt (R-MO).

In United By Interest, he is teamed up with top Democrat movers and shakers like Mike Williams—a top black Democrat who served in former President Bill Clinton’s White House as a special assistant for legislative affairs before running government affairs for Credit Suisse and the Bond Markets Association.

Williams, who joined Geduldig on Breitbart News Sunday on SiriusXM Patriot Channel 125 this weekend, says that he believes about this plan that “it is” something that Congress can pass right now in an election year if President Trump and the members get behind it.

“One important thing to note is that we don’t have an infrastructure plan,” Williams said. “The Senate Democratic Caucus has come out with an infrastructure plan. The Congressional Black Caucus has come out with principles. The Hispanic Caucus has come out with principles. The White House has come out with its principles about what its infrastructure spending looks like. The problem that they all have is no one has a funding mechanism. So what we are pushing for is that funding mechanism, in that you don’t have to raise taxes and you don’t have to increase the debt to fund an infrastructure program. Here’s a new innovative way to do it if we just hold hands and say yes we’re going to be willing to try something different and it’s really not that different because as Sam noted it was done in 1986. So, do it again, and then you have money and then you can come up with an infrastructure plan. But if the principle, the driving force behind it, is that we want to put the money to work where it is going to have the most bang for the buck, then you start building around that 100 poorest districts and start radiating out. Then when the plan comes together the plan is going to be reflective of those principles rather than let’s say the 2009 stimulus plan with TIGER grants where everyone could apply for them and the people who ended up getting those TIGER grants are communities that were the most well-off because they actually had the time and resources to do the applications at the Department of Transportation to get those projects in their districts and the poor communities just sort of sat on the sidelines and didn’t really even benefit from that at all. So again, I really think it’s really important to note we’re not even pushing any sort of specific spending proposal, we’re just giving members of Congress the ability to raise the funds and we want to initiate a conversation on how those funds should be spent and where those funds should be spent and hopefully magic happens from there. So we’re trying to build a coalition around infrastructure by first coming up with where you get the money to do it.”

Geduldig said it will operate “kind of like a yard sale” if it happens.

“You take what’s been in the attic of your house or in your garage that you haven’t paid attention to or it’s not worth nearly what it was, you put it up for auction and the highest bidder gets to service that debt or that tranche of debt from whatever agency it was sold from and then you would take the proceeds from that when you sold it,” Geduldig said. “One principle conservatives kind of like is that we would take 50 percent or so of the proceeds and write a check to the United States Treasury and pay the deficit down with a significant portion of the proceeds received. But the second half of the money is interesting, it’s a political idea where we kind of use the kind of poorest districts idea. How can we get them on board with something and the rest will follow? We take the other half of the assets sale and insist that it will be used in communities below a certain poverty line but very equitably. So, maybe Detroit would get a certain amount of money and then a certain amount would be allocated in Ted Yoho’s district in the panhandle of Florida. But I think one of the ideas that the cosponsors are kicking around is insisting that the people who work on these infrastructure projects actually live and be constituents of the communities that are receiving the funds so it’s kind of like a double whammy. The communities that have been hit the hardest get the money spent in their congressional district, and on top of that there’s a work requirement that shows that the workforce that is doing this work come from the congressional district in the very first place. We think it has a lot of promise and we’re very hopeful to have a bill introduced when the members come back to town after this president’s day weeklong district work period. But we think we are on track to get significant conservative and Black Caucus and Hispanic Caucus support and the goal is that once it’s introduced hopefully people will follow.”

The bill has not been introduced yet, but is expected to be by members of both parties when Congress returns to Washington next week. And it offers not just Trump a way for a win—and members of Congress of both parties a way to financially responsibly handle getting infrastructure projects booming in their district—but it offers up a bigger idea moving forward: A whole new approach to American politics.

Geduldig and Williams, respectively, come from vastly different worlds. The other partners they have in this new firm, United By Interest, do as well. Joe Velazquez, who was Deputy Political Director for Bill Clinton in the White House and Assistant Political Director of the AFL-CIO, has “more than three decades of experience working with national and local Hispanic organizations and the Hispanic Congressional Caucus,” per the group’s website.

Jennifer Stewart, who worked for Congressional Black Caucus members Reps. Gregory Meeks (D-NY) and Eddie Bernice Johnson (D-TX) is another partner. Fellow partner Jim Terry served as a political director for former Arkansas Gov. Mike Huckabee’s presidential campaign and for outgoing House Foreign Affairs Committee chairman Rep. Ed Royce (R-CA), among other Republicans. And David Morgan was a legislative director for Rep. William Jefferson (D-LA) and also served as a vice president at American Express.

This power player list seems typical for any lobbying or public affairs firm in D.C. But the difference here is, according to both Geduldig and Williams, that in the age of Trump and the resistance against him, these folks are not designed to cater to the whims of the political establishment like House Speaker Paul Ryan and Minority Leader Nancy Pelosi or Senate Majority Leader Mitch McConnell or Minority Leader Chuck Schumer. It’s not like they’re going to war with the Ryan-Pelosi-McConnell-Schumer cabal either, but they’re simply cutting around them to the future of American politics: the base of both parties.

The Republicans in this firm, Geduldig and Terry, are aiming their efforts at building support for initiatives in the base of the GOP, particularly the House Freedom Caucus and conservatives around it. While the Democrats—Williams, Morgan, Stewart, and Velazquez—are aiming their efforts at building support for legislative ideas in the Congressional Black Caucus and the Congressional Hispanic Caucus.

“United By Interest is a lobbying and public affairs firm that is focusing on the growing bases in both parties,” Geduldig said on Breitbart News Sunday. “If you look at the Republican Party, I think over the last ten years you’ve seen the members of Congress that represent the poorest, most rural districts in the South, in the West, in Appalachia, the vote bloc is growing in strength and is important to the leaders in getting whatever legislative priorities and fixes through the Congress. And we focus on issues that affect the poorest constituencies, which kind of mirror the base of the Republican conference. On the flip side, and I’ll let Mike talk about it, if you look at the power center of the Democratic Party, the growing base is certainly the Congressional Black and Hispanic caucuses. They often vote together and they are often less well off than certain other communities. We actually did a study and looked at the 100 poorest congressional districts. I think the stereotype in Washington is that Republicans are wealthy and just Democrats represent poor areas. That’s just not true. Republicans represent just as many poor districts as Democrats do. The approach that United By Interest takes is figuring out how to approach policy initiatives and make legislative proposals benefit them instead of maybe the way it’s been done in the last dozen or so years.”

Williams added that United By Interest’s thinking goes that if ideas can gain enough support from what Washington, D.C., views as the outer fringes of the House conference—approximately 100 or so members from conservative and progressive wings of the GOP and Democrat party—that it will be tough for the rest of both parties to resist signing on board to a big picture reform deal that helps the hardest hit Americans nationwide on both the GOP and Democrat side.

“As Sam noted, the primary focus here is on economic prosperity and economic development in many of these areas across the country,” Williams said. “One of the driving forces behind President Trump’s election was sort of economic disenfranchisement. Democrats were not able to get on top of that and get a message that spoke directly to their voters. So what we are sort of trying to do is say look, there are real policy and political differences between the parties and we are going to recognize that and call it what it is. However, these elected officials are just that: They are elected to represent the priorities of their constituents, and many of their constituents feel that they are not a part of the economic train that’s going down the track. So how do you address that? We can address that through infrastructure, we can address it through healthcare, education, criminal justice reform. The list is long of issues where there can actually be bipartisan agreement on how we move the country forward. But, we move the country forward in a way where you actually get the people who are at the bottom and make sure they are also rising along with everyone else. So that’s the real focus, and as Sam noted, we looked at the 100 poorest congressional districts and we were amazed that it was almost a third, a third, a third with Freedom Caucus, Congressional Black Caucus, and Congressional Hispanic Caucus members. So, we surmised, hey if you can come up with a coalition of those hundred, then we dare anybody else—anyone of the other 435—to say hey that’s a bad idea and we just don’t want to do that because we don’t want to take care of poor people.”

It remains to be seen how this plays out, but if it works it could fundamentally change American politics forever—since deals will no longer be worked out by the establishments of both parties is some smoke-filled D.C. back room but instead out in the open by the bases of both parties.

“As a lobbyist, I spend a lot of time paying attention to what moves members of Congress,” Geduldig said. “As a Republican lobbyist, I kind of focus more on the Republican path to success. Certainly in the last six years, but it’s sort of been trending this way and it’s been trending harder, the base of the party tends to be more conservatives and those members that represent those districts are generally poorer districts. The key to good lobbying is respect. When you get patted on the head and told that you’re crazy and to go in the corner and the adults are going to take care of this, it sets conservative members off and rightfully so. We’ve seen an alienation, I’ve seen it as a lobbyist. The party is not actually unified. It’s factioned off in many different kinds of coalitions. And, the approach we take—my firm, and I’m at an all Republican firm—the approach we take trying to get to consensus, it starts with respect. If you can respect, if you can show members of Congress why their concerns are important and important to resolve, you can get much further quicker than just diving towards the arguments you’re comfortable making. I guess if United By Interest has a founding principle, it’s respect. It’s respect for other people’s views as different as they may be. They deserve to be heard. They’re not crazy because they’re actually living in the districts that are impacted the most by Washington. And that’s the approach that we’re trying to take. I think we need to note that this is a startup. We have no clients. It’s a fragile thing and we’re trying to kind of nurture it along and see if this approach can take hold.”

Williams added this new effort has been years in the works and that so many black and Hispanic members of the House feel like they are just being used for immigration, civil rights, and criminal justice debates—and that they are being left out of the big-picture economic and other policy battles. They want not just a seat at the table, but they want to drive the discussion, in much the same way that conservative outsiders in the House Freedom Caucus want that in the House GOP conference.

“One of the things we talked about when we started this effort almost two years ago was the notion for the black and Hispanic lawmakers is that they get called upon when there is a civil rights issue or an immigration issue or a criminal justice reform issue,” Williams said. “They actually represent millions of Americans who have real problems and the same problems that constituents from other issues have and they want to be a part of the policy debates, the big policy debates that move the country forward, because they represent those people as well. If you look at the Congressional Black Caucus, more than half of them represent districts that are not—not—majority minority districts. They have an overwhelming desire to push the agenda forward. So if you look at the lineup in the House of Representatives, you have 7, 8, possibly 10 committees that could be chaired by Congressional Black Caucus or Hispanic Caucus members if the Democrats take over, but even if they don’t you still have them in senior positions in the House on key committees driving the agenda and I think that’s something that we wanted to harness. That’s the Washington story. The story on the ground is if you look back at 2016, yes Donald Trump won if you look at a lot of the Freedom Caucus areas, but that’s because a lot of folks did not turn out in the black and Hispanic communities because they did not feel like anyone was talking to them specifically. It wasn’t good enough to say Donald Trump is not your friend. Hey, that’s great. But we also want to know what it is we’re going to do to feed our families and make our situations better. And we need to have that conversation, and we strongly believe that if you start to have that conversation and you start talking to people about how they’re going to become part of the economic engine that’s moving down the track here, then you start to have engagement across the political spectrum.”



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