June 1, 2023

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Biden’s infrastructure package ‘invaluable’ for US economy: investment banker

A $1 trillion bipartisan infrastructure bill hangs in the balance ahead of a scheduled vote on Thursday amid frustration from progressive Democrats who want the party to reach an agreement beforehand on a larger climate and social welfare package. 

The sprint toward passage of a pair of bills that could total some $4.5 trillion in spending comes as Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell on Tuesday warned Congress that the Delta variant had slowed the U.S. economic recovery. 

In a new interview, Suzanne Shank — who leads one of the nation’s top underwriters of municipal bonds, specializing in infrastructure projects — affirmed her support for the trillions in new spending, saying the infrastructure improvements would prove “invaluable” for the U.S. economy. 

“Any plan that helps our country get from the D-plus [infrastructure grade] it has been for so many years, I think we just emerged to a C,” says Shank, the president and CEO of investment bank Siebert Williams Shank. “For us to be competitive globally, we need to get to the A-B range.”

“[It] is going to be invaluable to our country and to our economy,” she adds.  

Facing a loss of support for the $1 trillion bipartisan infrastructure bill from progressive House Democrats that could impede passage, some Republican senators and business trade groups have implored House Republicans to support the measure, The New York Times reported.

But House Minority Leader Kevin McCarthy has urged members to oppose the bill, saying it’s inextricably linked to a $3.5 trillion package that extends beyond traditional infrastructure projects, including support for home health care and incentives for clean energy.

The $1 trillion bipartisan bill features a host of spending measures focused on building new or maintaining old infrastructure, including $110 billion in new funds for roads and bridges as well as $39 billion for modernizing public transit. 

The injection of federal funds would likely spur localities to issue municipal bonds, prompting a surge in investment, Shank said.

“We hope to see municipalities leverage the infrastructure bill — they will probably have to issue more bonds to match some of the funding from the federal level,” she says. 

“So we think overall, it will be very positive to supply and obviously make our municipalities stronger going forward,” she adds.  

Forecasters disagree over the anticipated economic impact of the bipartisan infrastructure bill. A host of economists told the Wall Street Journal last month that they expect “limited” impact on U.S. growth. Meanwhile, Mark Zandi, chief economist at Moody’s Analytics, wrote in July that increasing infrastructure investment “has significant macroeconomic benefits.”

President Joe Biden delivers remarks on COVID-19 during an event in the South Court Auditorium on the White House campus, Monday, Sept. 27, 2021, in Washington. (AP Photo/Evan Vucci)

President Joe Biden delivers remarks on COVID-19 during an event in the South Court Auditorium on the White House campus, Monday, Sept. 27, 2021, in Washington. (AP Photo/Evan Vucci)

Shank began her career as a civil engineer, before she realized she could have more impact financing projects than designing them. 

After earning a master’s degree in business administration from the Wharton School at the University of Pennsylvania, she co-founded the investment bank Siebert Cisneros Shank, which later became Siebert Williams Shank.

Speaking to Yahoo Finance, she said the wave of federal spending will allow localities to focus on enhancing their infrastructure instead of repairing it.

The infrastructure package will “make our municipalities stronger going forward so they’re not doing emergency fixes,” she says.

“Rather than deep investment that will be impactful, and positively impact our infrastructure going forward,” she adds.

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