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The Infrastructure Election

Barry Ritholtz is a Bloomberg View columnist. He founded Ritholtz Wealth Management and was chief executive and director of equity research at FusionIQ, a quantitative research firm. He blogs at the Big Picture and is the author of “Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook the World Economy.”
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Some really fascinating things have been going on beneath the surface of the roiling primary elections. The sages in the political parties and the media elite have been wrong for most of the cycle; the electorate is angry, and the prize is very much up for grabs.

Tonight, Iowans will vote in the caucuses, and if the latest polls are too be believed, Donald Trump and Hillary Clinton will win (but in Clinton's case, just barely).

Perhaps this is wishful thinking on my part, but I believe there is a genuine chance that infrastructure may end up as a key issue in this election. Admittedly, this is a pet issue of mine (see this, this, this, this, this, this and this) but bear with me while I explain the scenario that makes this part of a broader national debate.

A look at the headlines suggests why the political insiders are having such difficulties: Threats both homegrown and overseas have multiplied. We seem unprepared to deal with even ordinary winter storms, let alone extreme weather events. The electrical grid has become increasingly unreliable and vulnerable to attack; U.S. roads are a potholed mess and bridges have collapsed, sometimes with devastating loss of life; American railroads are antiquated, and literally go off the rails for failure to install technology that is 20 years old.

Maybe voters have awoken to the reality that in the rest of the developed world, governments provide infrastructure with some degree of competence; in the U.S., as if to prove an ideological point, government does not.

Is it any wonder there is what Vox called “the Trump-Sanders constituency?” Despite the many policy and stylistic differences between them, Donald Trump and Bernie Sanders share one major trait: Voters see them as outside of the political mainstream. That was once the anticipated role for the Tea Party, at least among some Republicans, but that has faded. The Tea Party no longer drives the agenda as it did in 2010 or 2012. The appeal of the outsiders, however, remains strong, as both the Trump and Sanders campaigns attest. This time, the agitation seems to favor people who potentially are capable of getting something done.

Trump, the leader in the Republican primary polls, is a real estate developer -- he actually has built things. Sanders, who calls himself a democratic socialist, critiques Wall Street and income inequality in a way that no other politician has, except perhaps for Democratic Senator Elizabeth Warren. Ted Cruz, Trump's closest rival, also looks like an outsider, but in an ideological and apocalyptic kind of way. He's widely seen as negative, disruptive and a source of political gridlock who is widely reviled by the Republican establishment -- thus a source of much of his appeal with the party's base.

Now consider the mess that is U.S. infrastructure: The American Society of Civil Engineers gives the country's road, bridges, ports and tunnels a D+ grade, requiring more than $3 trillion to bring them up to standards. Wikipedia even maintains a page of bridge collapses. The story about Flint, Michigan, and drinking water tainted with lead has exploded across the headlines, but it isn't just Flint: As Rolling Stone has reported, millions of homes in the U.S. receive water with excessive amounts of lead.

 Meanwhile, the gas tax, the primary source of revenue for road and bridge repairs, is stuck at 1994 levels even as oil prices collapse to less than $30 a barrel. U.S. roads stink and our bridges are falling because that’s what one man -- Grover Norquist -- and his devotees find preferable to any tax increase, even to keep up with inflation. Norquist has half of America’s elected officials terrified, and hundreds of them have signed a pledge to never, ever increase taxes. (Send him your bills for flat tires and broken axles at Americans for Tax Reform.)

The past six years has seen one of the least productive, do-nothing Congresses ever, driven largely by personal animus toward President Barack Obama. I get the sense that voters are sick and tired of it.

Which brings us back to today’s Iowa caucuses. I am rooting for the outsiders, from both parties. Maybe one of them might get something done for a change.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Barry L Ritholtz at britholtz3@bloomberg.net

To contact the editor responsible for this story:
James Greiff at jgreiff@bloomberg.net