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Defeat The Highway Bill

By: Daniel Horowitz (Diary)  |  February 2nd, 2012 at 02:30 PM  | 

RESIZE: AAA

Here we go again.  Republicans talk incessantly about the need to cut the deficit, yet they are once again proposing a policy that will actually augment the deficit.

On March 31, authorization for transportation spending, along with its accompanying revenue source – the federal gasoline tax – is set to expire.  Republicans in the House and a bipartisan group in the Senate have introduced dueling proposals to fund long-term transportation projects, in lieu of the short-term bills that have been enacted since 2007.  Unfortunately, the Republican House bill is not much better than the Senate bill.

One need not be a staunch conservative to appreciate how inane it is to collect gasoline taxes from all 50 states into one pool, only to be doled out randomly for every state’s personal transportation project.  Ever since the Interstate Highway System was completed almost 20 years ago, there has been no rational purpose for the current top-down federal control over transportation.  Successive congresses have diverted as much as 38% of the gas tax revenue to mass transit projects and wasteful endeavors for specific states.  The net result is that some states are donors (contribute more), while other states are recipients (receive more in funding than they contribute).

We need to abolish the federal gas tax, and devolve all responsibility and taxes for transportation projects to the states.  The two bills percolating through Congress will double down on failed policies, add to the debt, perpetuate inefficiencies in highway construction, continue to encumber traffic, and preclude any devolution of responsibility to the states.

The Senate bill, S. 1813, funds transportation at $109 billion over two-years, $54.5 billion per year.  The House bill, despite accolades from Republican leadership, is only slightly smaller than the Senate version.  The House bill, HR 7, will authorize $260 billion over 5 years, $52 billion per year.  Both bills continue to divert about 20% of the gas tax revenue to fund liberal mass transit projects.  But here’s the kicker: according to CBO, the Highway Trust Fund will only take in $187 billion in revenue over 5 years.  Both bills rely on using all unspent funds in the trust fund, totaling about $20 billion.  We will still incur a $30-50 billion deficit over 5 years, and at least $136 billion over 10 years.  Remember we already bailout out the trust fund in 2008 with general fund revenues to the tune of $35 billion.

But, fear not, Republicans plan to attach three bills authorizing drilling in ANWR, offshore, and in the western states.  They pledge to use the revenue from the royalties to offset the deficit engendered by general fund transfers to the Highway Trust Fund.  The problem is that these proposals are dead on arrival with the Democrats.  Once we agree to the premise of higher transportation spending, and the Democrats jettison the drilling royalties, we will be left with a deficit once again.

This position mirrors the cycle of capitulation with the budget bills.  Democrats propose some profligate legislative budget bill.  Conservatives advocate that we uproot the entire premise by drawing a line in the sand on the principles that got us elected.  Republican leaders eschew conservative principles and acquiesce to the premise that the Democrat budget is a priority too big to fail.  They telegraph the message to Democrats that they will never let the budget bill fail, but promise to make them pay for it with reforms or other spending offsets.  Democrats balk at the offsets. Finally, we are left agreeing to the spending without the offsets.

Moreover, if we run a perennial deficit in the trust fund, we will be permanently exposed to future hikes in the gas tax.  The Chamber of Commerce and Big Labor are already joining in an unholy alliance to support a gas tax hike.

We must defeat the 847-page highway bill, and call upon Congress to devolve transportation authority to the states.  At the very least, they should stick with the original House proposal to peg the cost of transportation spending to revenues from the gas tax.  Why are we negotiating with ourselves again?

Cross-posted from The Madison Project

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COMMENTS

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  • DerKrieger

    …people advocate federalism,

    “We need to abolish the federal gas tax, and devolve all responsibility and taxes for transportation projects to the states.”

    But hate when the term isn’t used.

  • rogsterling63

    Work this devolution concept out. Ohio spends $X on its highways, Kentucky spends $Y. Kentucky’s roads fall apart. Trucks coming from Canada (our largest trading partner), enter through Michigan, pass through Ohio, and cross into Kentucky only to be met by substandard roads and bridges en route to their delivery in Tennessee. They shit traffic, they hit poor pavement, and their delivery is delayed costing time, thus money.

    What is a transportation network if not federal interstate commerce?

    • ss396

      Then you charge a premium to haul goods into Kentucky.
      Or you eat the costs for the added maintenance.
      Or you burden your other destinations with the added costs you incur from your Kentucky shipments.
      Or you don’t truck to Kentucky.
      Or join other trucking companies to lobby Kentucky to fix its roads (and then accept the higher taxes/fares/fees incurred in Kentucky).
      Or, …

      It’s commerce; it’s even interstate commerce. But that doesn’t mean it’s Federal. Not every national problem requires a Federal solution.

      • renl57

        How do you manage the national airspace except at the Federal level? Especially in an age of terrorism?

        • miconservative

          should we devolve that power to the state as well and allow each state to run their own air traffic control system? Regulating transportation and promoting the construction of efficient transportation systems in every state is a federal interest and in line with Article !, Section 8, including both the power of Congress to regulate commerce between states and to build roads.

          It was Republican Abraham Lincoln that authorized the building of the Intercontinental Railroad, Republican Teddy Roosevelt who built the Panama Canal, Republican Dwight Eisenhower who built the Interstate Highway System…all of which have had a profound impact on building this nation. Republicans understand that economic growth follows a strong transportation system. It is an enumerated power.

          The GOP House has put foward a good proposal and part of which is expanded energy production which also creates jobs. It also has needed conservative reforms to remove bureaucratic hurdles that we should all support. States need a 5 year bill so that they can plan effectively. If the Dems don’t like the pay for then they need to come up with a better idea. There is nothing wrong with starting the conversation.

          You say that the idea of energy production as a pay for is DOA in the Dem Senate. How viable in the Dem Senate do you think your idea of devolving all power back to the states?

        • ss396

          International air space is not managed by the US Federal Government; not even Canada’s or Mexico’s. Yes, they are coordinated, but the US Federal Government only has responsibility for, and jurisdiction in, the US airspace. There are some 190 nations’ airspace that the US Federal Government is NOT managing. Europe is pretty tightly-packed, presenting any number of problems & challenges for air traffic management, and comparable to the US States. I’m not sure how Europe runs theirs under the EU, but prior to the EU each European nation had its own system. Coordinated, yes, but still their own. Decent safety record, too.

          So it doesn’t HAVE to be Federal. Again, not every national problem requires a Federal solution.

  • rogsterling63

    that would be “hit” traffic!

  • miconservative

    Article I, Section 8 of the Constitution gives an enumerated power to Congress to build roads. How is this not a federal issue?

  • Risky

    While the national interstate network is clearly something that can sensibly be looked at at a federal level, it’s hard to see how urban mass-transit schemes however worthy are a matter that needs to be taken beyond the relevant city and state authorities. You can believe that LA needs better public transportation without seeing a reason for it to be planned in DC or paid for from Maine.

    That said I’d say that gas taxes are better taxes than income taxes (I’d rather tax consuption of resources than working) and setting gas taxes state by state is going to be inefficient as smuggling tanker loads of gas is a going to be bit too easy. I’d say keep the gas tax but refund the amount not needed for the interstate system to the states where it is raised.

    • rogsterling63

      Agree, to a certain extent. But let’s use your LA example. 40% of all containerized goods (your Asian manufactured electronics and such) imported to the United States enter through the ports of Los Angeles and Long Beach. They’re put on trucks and rails for shipments to markets east in many other states.

      If those trucks hit congested urban LA traffic, they can’t guarantee delivery times, consume more gasoline, etc. etc., all costs to the shipper and retailer, that are all passed on to us the consumer.

      So, if increased transit in LA removes some of the passenger cars from the freeways and frees up space for those east-bound trucks, could you make a case that urban transit in LA is thus a federal purpose?