Jul 24 2015
By The Editorial Board
America has a transportation problem. Its highways and bridges are in desperate need of repairs. Its major population centers are in desperate need of road and rail capacity to get people and products out of traffic jams. And the Highway Trust Fund — used to build and maintain those roads, bridges and transit systems — is running short of cash. Without congressional action, federally financed projects will come to a halt at the end of this month.
Unlike many problems, this one has a simple solution. The 18.4-cent-a-gallon federal gasoline tax hasn't been raised since 1993. Thanks to a worldwide oil glut, gas prices have dropped so far that Congress could quintuple the gas tax without pushing pump prices above where they were at this time last year. Merely restoring the tax to its 1993 level (a little more than 30 cents in today’s dollars) and indexing it for inflation would be a big start toward a major infrastructure upgrade. And given the volatility of prices at a pump, motorists would barely notice the 12-cent increase.
But will Congress adopt such an obvious fix? Of course not. Too many of its members have signed away their souls to gatekeeper groups. In return for these groups being nice to them, lawmakers have promised not to raise taxes for any reason at any time.
Congress has resorted to a string of short-term "fixes" to make up for the gas tax revenue lost to inflation and more fuel-efficient vehicles. Some 33 such fixes have been passed in the past decade. One recent fix raises cash by allowing corporations to underfund their pensions (resulting in them having more taxable income).
The patchwork plan under consideration now, at least the Senate’s version, is even more ludicrous. It mysteriously finds money throughout the budget by such tricks as claiming unspent funds from the bank bailout and tweaking various taxes and fees.
It also contains an absurd "buy high, sell low" plan to auction oil from the Strategic Petroleum Reserve. This would, no doubt, raise some cash. But it would do so by doing exactly the opposite of what the reserve is supposed to, which is to buy oil when it is cheap and abundant and draw it down when it is expensive and in short supply.
The Senate envisions raising $9 billion by selling 100 million barrels at $90 per barrel. That's a pretty good trick considering that West Texas Intermediate was selling below $50 Thursday. Talk about smoke and mirrors.
Congress' dysfunction over what should be a straightforward issue would be laughable if it weren’t so appalling. Its short-term fixes are bad public policy, invite cynicism and don’t even address much of the backlog of national transportation needs.
Meanwhile, the solution to the problem is so easy to see. The gas tax is simple and fair. It hits people who use the roads the most and drive the least fuel-efficient vehicles. Just raise it already.