What happens now that the “big, beautiful bill” has passed and the DOGE budget rescissions are taking effect? Do we just tally up the economic pain and hope that’s enough to restore sanity after the 2026 elections? Or do we start developing a forward-looking platform on jobs and competitiveness, mindful of the old maxim that you can’t fight something with nothing?

Put me down for the latter strategy. It’s never too soon to start building a case for economic leadership and framing a clear contrast between the kind of American governance that rewards the makers—the workers whose manufacturing jobs have gone away—and the kind that benefits the takers—the billionaires who certainly don’t need another huge tax cut.

This isn’t the last tax and budget fight. There will be many, many more to come, both in Washington, D.C., and in the states. So where do we start? Strangely, the plan begins with embracing the areas of clear consensus that exist despite the sickening partisan divide plaguing our country right now.

Poll after poll shows broad bipartisan agreement about the need to restore U.S. competitiveness in manufacturing, especially in communities left behind by globalization, and to beat China. Large majorities of Americans have also grown wary of promises from Washington, executive order rollbacks, and zig-zag governance taking us nowhere.

We also know that in think tank circles, pretty much everyone agrees that the eras of unfettered free trade and neoliberalism, whatever that is exactly, are over. The big question now is whether a new consensus on smart federalism and local control can emerge to help kickstart economic competitiveness—or whether nostalgia for how the world used to be or government used to work will derail the effort.

The key, I believe, is to take the best ideas from the national arena and implement them from the bottom up—targeting the urban and rural communities in greatest need. This would be built around an initiative that would be anchored by meaningful government innovation and performance-based incentives, all with the goal of bringing development capacity to America’s overlooked emerging markets. Funding to help restore communities hollowed out by manufacturing decline—which wasn’t provided by the recent reconciliation bill—could instead come from existing and new tariff revenues.

Here are the key ingredients of this new recipe.

Targeted Place-Based Investment: The Biden Administration had the right idea in making substantial investments in industrial transformation. But building new industries and supply chains through investment incentives and (highly selective) trade protection takes time. One big problem with the multitrillion-dollar Biden investments was that most of the money was filtered through antiquated government programs with very complicated eligibility requirements, so funds often failed to reach the communities that needed the help the most.

The solution is to reform federal programs by more simply defining which projects and places are eligible. By conservative estimates, $200 billion in catalytic predevelopment capital to de-risk and develop new public-private partnerships could generate $1.6 trillion in new economic activity over a decade. That’s bang for the buck.

Tariff and Trade Reform: Another good idea, this one advanced by the Trump Administration, is to revisit our tariff rules, which were set up decades ago to first support allies with the goal of blocking Communist expansion and then to integrate China into the world economy. Today, these rules put U.S. manufacturers, who have to comply with basic health and workplace safety requirements, at a disadvantage. Reforms to advantage cleaner manufacturing in the United States versus foreign goods that produce more carbon emissions could generate bipartisan support.

Clearly, retooling the global supply chain that created the cheap consumer goods economy can’t happen overnight. Like President Biden, President Trump risks doing too much, too fast in reshaping complex supply chains. We also have a very narrow window in which to figure out how to ensure that smaller manufacturers, who are the most dependent on global supply chains and export markets, aren’t collateral damage in Trump’s tariff war.

And we need to make sure that any new tariff revenues—above the $80 billion to $100 billion in annual tariff revenues that rolled in during the Biden Administration—support those communities hit hardest by manufacturing losses.

Tax Reform: If we do want to help restore communities hollowed out by globalization and technology, shouldn’t the tariff revenues we generate go to the places with the best opportunities for high social returns? That’s why tariff revenues should be shared with state and local governments, local businesses, and nonprofits. Dedicating $20 billion per year in tariff revenues for the next ten years would be a smart way to jumpstart local economies in thousands of underserved areas. Local communities and businesses are better able to decide what projects and markets are ripe to scale up in this moment. I’m confident that these investments would pay for themselves through economic development and good jobs.

Innovative Delivery: We all know that the best way forward is not to rely on Capitol Hill staff (and lobbyists) to write another late-night reconciliation bill and hope our creaky government piping can do the job. There is a faster way to incentivize reform: Empower local leaders with flexible funding and a one-page performance agreement rather than overly complicated requirements. The good news is that we don’t need to start from scratch; there are several successful examples of performance-based federalism to draw from.

To break through crusty federal program silos, the nearly 75 federal predevelopment and economic development programs could be linked together around an agreed-upon set of eligible projects, such as affordable housing, broadband, water and wastewater, and affordable energy. Local communities could then choose which programs to apply to through a common app. Earmarked tariff revenues would support regional economic resilience partnership projects and small business creation. This public funding would then catalyze private investment in local public-private partnerships using deal-matching platforms like the Milken Institute’s Community Infrastructure Center.

What would a bipartisan effort to use a portion of tariff revenues to help communities in Forgotten America jumpstart jobs, manufacturing, and competitiveness look like?

The key is to incentivize federal programmatic and permitting reforms from the bottom up through performance-based block grants, which would promote both permitting and program consolidation. Doing so through a series of low-cost, high-impact, and performance-based initiatives would then leverage trillions in public, private, and municipal bond investment at a time when federal funding is harder to find.

Doing this will take three strategies:

1. Direct Catalytic Capital and Capacity to Forgotten Communities

Substantial evidence shows that many underserved communities lack the resources to develop loan-worthy applications, or even to afford a grant writer. For distressed communities struggling to jumpstart their local economy and create investment-ready projects, the critical funding gap is often this “predevelopment funding.” This hard-to-get early funding pays for the critical tasks that need to be completed to turn a one-page project idea into something that is loan-worthy or investment-grade. For instance, before a town can access a government grant program or attract private investment, there are many detailed steps (representing about 5 percent of total project cost) that must happen, from project feasibility and marketing assessments to site preparation and land acquisition.

Based on past economic studies, each dollar spent on predevelopment will generate $16 to $20 in total economic outcomes and funding leverage. As such, future program and budgeting reforms for place-based investment at the federal level should prioritize access to these resources. Catalytic predevelopment funding to promote local public-private partnerships is not a partisan issue. Republican Senator Tim Scott of South Carolina supported the creation of a $1 billion State and Local Dynamism Fund to help make sure that the promise of Opportunity Zone tax incentives could reach local nonprofits seeking to advance community infrastructure projects. Vice President JD Vance also gets it: He introduced rural predevelopment assistance legislation when in the Senate.

There is a smoldering fire out there at the local level, with many communities ready to build but lacking the necessary catalytic capital. The issue is providing the right kind of funding “oxygen” to light up local economic development and private investment.

2. Undertake Program and Permitting Innovation Reforms

Even after predevelopment funding is secured, federal and state reforms are needed to improve program outcomes and permitting. Too often, misaligned incentives delay project completion and make it harder to blend together different sources of public capital.

Some of these reforms have worked well for large-scale infrastructure projects across the three administrations since 2015. Great examples include the Tappan Zee Bridge replacement in New York’s Hudson Valley, as well as many energy projects. At the community level, two approaches appear promising. First, eligible community infrastructure projects in underserved communities could be exempted from meeting federal program match requirements that often represent 50 percent of total project cost—something many high-need communities simply cannot afford—in exchange for commitments to improving permitting. Second, performance incentives could also be added to ensure that state and local infrastructure projects financed by federally tax-exempt municipal bonds are built to be disaster-proof. For example, the nation’s 50,000 bond issuers could be required to certify in their bond disclosure that they have a plan to effectively operate and maintain a newly financed infrastructure asset over the life cycle of the project rather than just fund the project without addressing long-term project resilience. This requirement would begin to reduce the nation’s $3.7 trillion deferred maintenance gap identified by the American Society of Civil Engineers and likely raise America’s infrastructure grade toward an A instead of the C’s and D’s that have become all too customary.

3. Create a Forgotten America Fund at the Treasury Department

The plethora of new programs and incentives created in the 2021 Bipartisan Infrastructure Law, the 2022 Inflation Reduction Act, and the 2022 CHIPS and Science Act clearly need to be harmonized to maximize local outcomes, with a focus on economic development, climate resilient infrastructure, and new business creation for near-shoring.

Access to a new Forgotten America Fund housed inside the Treasury Department and funded by annual tariff revenues ($20 billion a year for ten years, or one-fifth of current annual tariff revenues) would offer a national focal point for helping America’s manufacturers and makers get back on their feet.

Treasury would be wise to establish a series of regional investment funds that would recognize differing regional economic priorities and local assets and support prosperity centers and resilience programs at key agencies like the Department of Agriculture, the Department of Housing and Urban Development, and the Small Business Administration. The Treasury team could further look to support other high-impact programs, such as Brownfields predevelopment grants and the Federal Emergency Management Agency’s pre-disaster risk mitigation funding, which demonstrate proven bang for the federal buck.

To spur short-term project acceleration for scores of underserved communities, a new Regional Deployment Office (RDO) could be created within the Domestic Finance Office at Treasury. This office would be given the mission of accelerating capacity-building on the ground and transferring best practices and successful models among communities, states, regions, and project developers. A new RDO could also work with the Permitting Council and other entities to develop regional pilots that could link permitting improvements with other best practices in state and local finance and asset management. The Forgotten America Fund could also play a role in reforming federal disaster recovery programs, which will soon be under debate in Congress.

An estimated $27 trillion of new funding is needed by 2050 to build and maintain U.S. climate-resilient infrastructure, rebuild after extreme weather events, and retool America’s ports and critical supply chains. Federal funding alone cannot fill this gap. Trillions of dollars in sidelined capital could move into high-impact community infrastructure projects and projects of national interest if the right funding is made available now, alongside program reforms that reward local and regional innovation and promote innovative permitting partnerships.

Now is the time to build new resilience into America’s infrastructure and economic development systems, especially for the communities hit hardest by globalization, disinvestment, and manufacturing losses. It is also the moment to rebalance the equation in favor of America’s makers with any new revenues that tariff reforms generate.