The digital infrastructure we need – and how to pay for it


Until this month, the idea of ​​congressional action to invest hundreds of billions of dollars in the nation’s digital infrastructure seemed like a long road. But two weeks ago, after a month of Beltway wrangling over “hard, tangible” and “soft, social” infrastructure, the Senate quickly passed a separate and massive bill to fund and promote investment in technology for the future. information in order to counter Chinese ancestry. The House committees are now deliberating on this package, and it is a question of piecemeal counter-proposals.

Meanwhile, a bipartisan group of senators have come up with a spending proposal for conventional hard infrastructure, but supporters are wondering how to pay for it. A smaller bipartisan cadre introduces a bill to bridge the digital divide. Behind the scenes, Liberal Democrats are brewing a “kitchen sink” budget reconciliation plan that would include their soft infrastructure and coveted social spending, seeking a party line vote on an omnibus bill later this year. It is still unclear whether West Virginia centrist Democratic Senator Joe Manchin will resist the move until the new fiscal year in October.

As a result of this shifting congressional dynamic, state and local government leaders now have several goals in mind to get Congress to approve funding for infotech that transforms smart cities, digital literacy, cybersecurity in services. municipal government and the landscape of tax incentives for high-tech manufacturing. . Not all of these initiatives are likely to pass both houses in a single bill, but the odds have improved dramatically for multi-dimensional funding of digital infrastructure. As the potentially cleanest form of pig barrel politics, with extensive local benefits, it is the dormant problem of municipal finances that now requires wise and focused advocacy.


To compete globally and maximize our nation’s productivity, America must invest quickly in its digital future by spending the money needed for public access and technical leadership in the digital world. State and local governments will be the ones providing most of this capability, so a federalist partnership is needed, with substantial congressional dollars behind it. In this case, private companies and employers nationwide will ultimately benefit, so they should have a key role to play in financing debates.

Here are some foundational elements that should be included in federal funding bills to put America back in the lead in the global race for high-tech digital competitiveness, security and leadership that benefits all workers and not just to the elites of Silicon Valley and Seattle:

● Cybersecurity. The first order of business this year must be a massive infusion of federal funds to consolidate and strengthen our digital infrastructure to protect us against ransomware and malware attacks, especially those originating from abroad. While private companies are already scrambling to bolster their cybersecurity functions and staff, city governments and utilities are sitting ducks. Many of them lack the resources and skills to strengthen their protective shields, train employees and ensure backup capabilities. We cannot afford to fail water and sewage systems, airports, municipal electricity and gas utilities and voting equipment through smart design. Federal block grants that states must distribute to vulnerable agencies and municipal utilities must be Job One. Congress can induce software companies that sell firewalls and anti-phishing alerts by exempting qualifying profits from these tools for several years from tax when sold to government agencies, hospitals and carriers. energy for a modest increased cost price.

● Digital access and literacy. Like FDR’s national rural electrification program, we need to universally expand affordable broadband. But broadband access isn’t all you need. High schools need to equip all students with the basic computer skills that today’s jobs demand. All high school graduates should know the basics of common software systems, including installation, maintenance and cyber hygiene. A new body of teachers must be trained, and disadvantaged students equipped with basic devices. All of this will require corporate sponsors as well as federal funding.

● Smart cities. Targeted grants should support demonstration programs rather than funding 10,000 local governments that are reinventing the technology wheel in their efforts to put data and digital technologies to work for their residents. Experts from the National League of Cities and the International City / County Management Association can advise federal officials in the selection of projects.

● Federal aid to colleges. Community colleges and public universities will need new funding for research and to create relevant programs for teaching advanced digital and cybernetic skills. Tuition reimbursement should be granted to college students taking qualifying IT courses directly related to national productivity and competitiveness. Vo-tech schools’ courses that train workers to install and repair digital hardware or troubleshoot software are expected to be fully funded by Uncle Sam, as is world-class research in cyber, robotics and technology. artificial intelligence.

● Vehicle micro-tolls. Electric vehicles and other zero-carbon vehicles never make it to the gas pump, where taxes on fossil fuels are collected, so their owners pay little for local roads and bridges. By 2023, expanding telecommunications networks paired with transmitters on most 5G-connected vehicles will capture their precise locations at a granular level so that cities and counties can set up micro networks. -toll. Eventually, we would all have to pay pennies to get to work, transport our kids to school, or visit the mall. Reimburse car dealerships for upgrades to older, all-electric vehicles at federal expense. Congress must pave the way for a digital revenue system by embracing this transformative conversion.

● A federal equalization tax break for new high-tech factories. In the face of a global shortage of microchips, there is stiff competition between states and communities for new manufacturing plants. If Congress ultimately grants grants or strategic income tax credits for building new factories, those incentives must come with a condition: offsets that reduce federal grants and tax credits by the amount of Tax breaks and allowances also received from states and localities, except waived by the president and an oversight committee of Congress. This will level the playing field for factory locations to focus on regional amenities, labor markets and core economic benefits which should in fact be the competitive goal rather than site specific tax benefits.

A federal tax on digital advertising or digital services would easily cover the cost of these national investments. More generally, a tiny digital financial transaction tax on stocks, options, futures and bonds online could on its own pay off for every hardware, software and digital infrastructure proposal currently on the table. But politically, these new revenues may be too far a bridge to warrant swift action, so one of half-dozen more conventional sources of funding for infrastructure would suffice.

The competing bills to which these transformational initiatives can be traced have become a three-ring Congressional circus. The task of state and local leaders and their Big Seven political organizations is now to clearly and quickly present their advocacy for digital infrastructure funding at every opportunity and to help their delegations to Congress take the paths of least resistance. in law. Unlike concrete bridges to nowhere, it can be clean hog and a national economic engine that rises above petty provincial politics.


GoverningOpinion columns reflect the opinions of their authors and not necessarily those of Governingthe editors or the management of.


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