Filed under: Capitalism, Democrat Corruption, Economy, Election 2012, Progressivism | Tags: Clueless on Transit Funding, The Highway Trust Fund, Used for Highways
Transportation Secretary Ray LaHood has said that the House transportation bill is “the worst” measure he’s ever seen “during 35 years of public service.” Does this mean that that those crumbling roads and bridges aren’t going to be fixed after all? They have been crumbling for nearly 5 years, according to Obama, if you count the last campaign.
But no, that ‘s not the problem. The legislation would eliminate the deficit-ridden Highway Trust Fund as a funding source for transit, walking and biking projects. Those undoubtedly possibly worthy projects would have to be paid for out of the general fund. The Highway Trust Fund, gasoline taxes collected from drivers of gasoline powered vehicles, would be restricted to paying for — highways!
The House bill assumes that there really are highway and bridge projects that need doing, and the portion of the gas tax that is set aside for that purpose should be dedicated to that purpose. In the new poorer America, the elites prefer that the proles ride on public transit or bicycles and leave the freeways for more sustainable vehicles, so they feel free to direct gas taxes to their favored projects.
There is, or should be, a distinct difference between a national transportation policy and an urban transport policy. Taxes levied on drivers should be spent to aid driving. Those politicians who don’t feel particularly restrained by law, regulation or the Constitution have no compunctions about dipping their sticky fingers into funds designated for particular purposes. The bigger government grows, the bigger the problem becomes. They regulate, you give them money, they use it as they choose. Not the way it’s supposed to work.
The biggest and most important reason for restraining the size of government is to make it more responsible to the people who grant it the power to do a modest number of specific things that are enumerated in the Constitution. The grandeur of the Capitol does give them a sense of their own importance, but that needs restraining as well.
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The United States is only a handful of countries that hypothecates (earmarks revenues for a special purpose) revenues from transport-fuel taxes for road-building and maintenance (yes, and some for urban transport and a tiny amount for bicycle infrastructure). And it is getting increasingly bad at that.
In November 2009, Subsidyscope analyzed the various sources of highway funding and found that user fees, which include revenue from fuel and vehicle taxes, are paying for an ever smaller share of America’s road costs. Using Federal Highway Administration data, Subsidyscope calculated that, in 2007, user fees [i.e., taxes on fuels plus fees charged to commercial truckers] accounted for just 51% of all road funding—a 10 percent decline over the previous decade and the lowest level since the creation of the Federal Highway Trust Fund (FHTF) in 1957.
Some of that shortfall is because of diversions to urban transport, but the bulk of the shortfall is because fuel taxes have not kept up with inflation and because, in recent years, volumes of taxable fuels purchased have started to decline. So, periodically, Congress bails out the FHTF with a massive — hundreds of billions of dollars a shot — infusion of capital. They’ve been doing this for decades.
In short, while urban transit is being cross-subsidized by drivers, driving itself is being much more heavily subsidized by taxpayers.
Expenditure on public roads and on urban transit should be determined on its own merits. The problem with tying that investment to a fuel tax is that the tax may be not enough or it may be too much. Either way, it leads to bloated highway administrations, the building of bridges to nowhere (new construction tends to be favored by porkaholics more than maintenance), and padding in construction and maintenance contracts.
You might be surprised to learn that, in sharp contrast to the United States, where President Eisenhower justified the building of the interstate highway system on national security grounds and then decided not to charge vehicles for its use, other countries have “privatized” their highway systems (through bidding processes) and allowed them to collect direct user fees — i.e., tolls. France did that a long time ago, and the condition of their highways is far superior to that of most U.S. interstate highways.
Tolls are not a new idea, by the way. They were the norm on State turnpikes throughout the northeast, and in Florida, long before the Eisenhower administration decided to completely change America’s system of long-distance driving.
Comment by Subsidy Eye February 22, 2012 @ 10:26 pmYes, privatizing has been discussed many times here. Dunno if they’ve actually done it anywhere. We have new tolls on one of the bridges over the lake preparatory to actually building the new bridge which (stupidly) is wider only for HOV lanes, which don’t seem to improve traffic flow at all. The toll is $3.00+, more at rush hour — I assume each way, so of course everybody is using the other bridge. And if they don’t collect enough tolls, they’ll try to toll the other bridge, which is not being rebuilt or remodeled. That will really hit the fan.
Comment by The Elephant's Child February 22, 2012 @ 11:20 pm