The Buzz

How Trump can Invest in Infrastructure and Make America’s Military Great Again

During his winning campaign and in the month since, President-elect Donald Trump has promised to make America great again by, in part, massive infrastructure spending and rebuilding the U.S. military.  History provides a valuable lesson for the incoming administration on how to make a dollar of increased spending serve multiple purposes. Simply put, investing in defense infrastructure such as naval shipyards and ammunition production facilities will help rebuild both the nation’s infrastructure and its military.

The turning point for the U.S. in the Pacific during World War II was the battle of Midway. Aircraft from three American aircraft carriers, the Yorktown, Enterprise and Hornet, successfully engaged a much larger Japanese fleet including six aircraft carriers, sinking four of them and forcing the Japanese to retreat. From this point forward the U.S. held the initiative, proceeding inexorably across the Pacific to victory.

While the story of the battle of Midway is well known what is not generally recognized is that essential to our success in that engagement was infrastructure money. To combat the effects of the Great Depression, President Franklin Roosevelt started a number of programs to stimulate the economy. Two of them were the Public Works Administration (PWA) and the similarly named Works Project Administration (WPA).

The PWA focused primarily on large infrastructure and construction projects, the equivalent of “shovel ready” programs in the 1930s. The WPA focused on light construction; it acted as both an employer of last resort and a social relief agency. Both the PWA and WPA sponsored road and highway projects, the construction of sewage, water and gas systems, and the building of schools, courthouses, hospitals, jails, dams, locks, bridges, tunnels and airports. The Lincoln Tunnel and La Guardia Airport in New York, the Tennessee Valley Authority and Boulder Dam were built with PWA funds. Just the kind of infrastructure projects President-elect Trump has proposed.

Both organizations, but primarily the PWA, turned out to play major roles in the American victory in World War II. It was the PWA that funded construction of the aircraft carriers Yorktown and Enterprise, whose planes were largely responsible for sinking the four Japanese aircraft carriers at Midway. In addition, the PWA funded the construction of four cruisers, four heavy destroyers, many light destroyers, submarines, planes, engines, and instruments. The PWA built 32 Army posts and 50 military airports; it also provided money for the purchase of trucks and military aircraft. In 1934 and 1935 all Army purchases of motor vehicles were made with PWA funds. As Harold Ickes, Interior Secretary and director of the PWA, wrote (somewhat self-serving) during the darkest days of World War II, “The PWA spent a billion dollars for defense. Thank God for the PWA.”

President-elect Trump has proposed a major increase in the size of the U.S. Navy from some 275 ships to about 350. This is exactly the kind of strategy Roosevelt pursued. The U.S., which had voluntarily limited the size of its fleet by the Washington Naval Treaty of 1922, had gone a step further and refrained from building up to the size allowed by the agreement. The Roosevelt Administration decided to build up to the top limit allowed by that treaty. Roosevelt was motivated both by the worsening national security environment and the desire to increase industrial activity and create jobs. Congress responded by appropriating $3.3 billion under another New Deal piece of legislation, the National Industrial Recovery Act (NIRA). Spending on defense infrastructure and products under the NIRA, PWA and WPA helped rebuild the Army and Navy in the years before the outbreak of World War II.

If the new administration is going to push for a major increase in the size of the Navy it will have to spend money on the underlying industrial base. This includes, but is not limited to, the shipyards that will actually build the additional warships. It means also expanding the capacity of the companies that provide critical systems, such as the nuclear propulsion systems for additional Virginia class SSNs. There is a lot of manufacturing involved in building warships.

Modernization of the U.S. Army to meet the challenge of peer competitors will require, inter alia, upgrades to existing Abrams tanks, Bradley and Stryker Fighting Vehicles and Paladin artillery vehicles. Some of this work is extremely high tech, but much of it is classic manufacturing work, what is sometimes called “metal bending.” It doesn’t hurt that many of the facilities where this kind of work would be done are in states such as Ohio, Pennsylvania and Michigan.

Another part of the defense infrastructure that would benefit from investment by the President-elect is the ammunition sector. This consists of both private companies and government plants that often are operated by private companies. Simply put, the ability of this nation to produce the bombs, rocket, missiles and artillery projectiles used by all the services is inadequate to meet current demands, much less fill up war stocks. There is a multi-year backlog to produce additional precision guided munitions. The plants that produce everything from the energetic materials for explosives and propellants, the bombs dropped by military aircraft and the small caliber munition fired by our soldiers and Marines in Iraq and Afghanistan are of World War II vintage and are sorely in need of modernization.

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