Kavinoky: Transportation — You Get What You Pay for
For an administration and Congress that have promised to tackle big challenges for the long-term benefit of our country, they appear to be taking a pass on one of the most important: investment in our nation’s highways, bridges and public transportation systems.
[IMGCAP(1)]The irony is that unlike cap-and-trade and health care reform legislation, reauthorization of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) is relatively uncomplicated and provides a proven bang for the buck.
So what’s the problem? Agreeing on how to pay for the badly needed improvements that will generate jobs and stimulate economic activity.
And the solution? It’s rooted in the basic principle we learned as young adults — you get what you pay for.
Drivers provide the majority of the resources for federal road and transit programs when they pay taxes at the gas pump. This “user fee— system has been in place since 1956 when Congress instituted a gas tax to pay for construction of the Interstate Highway System.
The challenge is that gas tax revenues have been declining while the need for repair, maintenance and expansion has been increasing. As gas prices rose and the economy slumped, Americans drove less, which means the gas tax generated less revenue.
In addition, the gas tax is not indexed to inflation and has not been increased in 16 years. Meanwhile, vehicles are becoming more fuel efficient, and infrastructure continues to crumble all around us, threatening our environment, safety, and economic productivity and global competitiveness.
The simplest, most straightforward way to find the money is through a modest increase in gasoline and diesel taxes. The U.S. Chamber of Commerce has never been accused of being a strong proponent of any kind of tax increases. But taxes paid on gasoline and diesel are different — they are user fees.
Motorists would get a tremendous return on their investment, including: a reduction of congestion that robs Americans of their precious time and mobility; fewer crashes due to poor road conditions; lower prices on almost every imaginable product due to smaller shipping costs; and confidence that America can compete and win in a worldwide economy.
If Americans are going to be asked to pay a little extra at the pump, they have a right to expect some things in return. Namely, that no money would go to wasteful earmarks, investments would go to projects that advance national interests, no revenues would be diverted to non-infrastructure projects, and we would put an end to red tape that endlessly delays and raises project costs. In fact, the chamber insists on them — we will not support a gas tax increase without these assurances.
The chamber also insists that Congress open new opportunities for private investment to supplement — and leverage — user fees. In fact, any gas tax increase could be kept to a minimum if we removed barriers to private investment. Public-private partnerships aren’t a substitute for federal revenues, but they do give states and communities the option to tap the estimated $180 billion in private-sector capital available for infrastructure investment. The federal government should not stand in the way of states and local communities exercising a full range of financing options that stretch federal, state, and local resources and access private capital.
What are the alternatives to a sensible increase in the gas tax and more private investment? They are not pretty. We could cut transportation programs commensurate with available funding levels — by about 35 percent. The result would be an accelerated deterioration of our roads, bridges and public transportation systems and a loss of jobs. Or we could pay for needed investment by using funds from the general treasury, which would add to the already burgeoning deficit.
The law funding our surface transportation programs expires on Sept. 30. Congress and the Obama administration need to seize this critical opportunity to ensure America has the best infrastructure system in the world. Now is the time to act.
America’s transportation infrastructure cannot fall victim to the practice of doing what is easy — delaying the tough decisions — over doing what is right. It will not be easy to repair our roads, fix our bridges and return our avenues of commerce to global competitiveness, but our economy cannot afford to ignore it any longer. It is an essential investment for the future of our country.
Remember, you get what you pay for.
Janet Kavinoky is the director of transportation infrastructure for the U.S. Chamber of Commerce and executive director of the Americans for Transportation Mobility Coalition.