Federal Highway Fund: You Don’t Get What You Pay For

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crumbling bridge

Our highways are a mess and the Highway Transportation Fund is out of funds and has been for some time. Two of the solutions being bandied about are higher gasoline taxes or taxes on overseas profits. Some don’t want taxes on overseas profits because they want that for “funding a broader tax initiative”. Profits are another ATM to feed the beast.

The one obvious solution is to de-centralize and privatize this failed system but no one is suggesting that.

People are asking if Congress can fix our crumbling roads and bridges. The answer is “NO” because the system is unaccountable, inefficient, not tailored to the local needs, far too massive, and being planned by special interests.

The highways had been paid for with gasoline taxes at a walloping 18.8 cents a gallon and 24.4 cents on a gallon of diesel. Gas is also taxed by the states to varying degrees depending on the state’s supposed needs. It’s also paid with excise taxes. When you see trucks on highways delivering our goods, it might have a sign saying this truck pays $70,000 per year or so in road taxes – that’s money that goes into the bankrupt highway fund and it’s money we pay for in higher prices on our goods.

The politicians are claiming that the fund is depleted because people are driving less due to the recession and improved car efficiency. Even The Washington Post noticed that this is exaggerated.

Even if one believes that all the taxes collected for the roads goes into improving the roads, why isn’t anyone talking about the inefficient use of funds for low-priority activities and the oppressive regulations which stifle innovation.

The Federal government subsidizes the state governments even as they add regulations. Why not abolish the federal government role and just let the states handle it along with the private sector as we once did?

Centrally planned transportation has grown into a massive, top-heavy, inefficient bureaucracy.

The sustainable highway programs are unsustainable and are geared towards reducing travel, travels which needs to take place. Taxes go into inefficient forms of transportation. The Federal government is also moving towards “livability” standards (Safe Routes to Schools, Transportation Enhancements, Recreational Trails, Scenic Byways, and the U.S. Bicycle Route System) which federalize land-use planning. That would certainly threaten private property and local control of zoning.

Meanwhile, our roads and bridges are crumbling and dangerous.

Since the interstate highways are complete, why can’t these responsibilities be given to states? States already contribute twice as much money to repair of highways.

In 1916 and 1921, highway laws were passed that allowed the first significant federal interventions into road financing. The federal government chose the projects and doled out the money to the states. They soon became an unnecessary intermediary between our tax money and the states and they get to make their Big Government rules.

The planning of highways and consequent taxes were supposed to sunset but the federal government kept coming up with new projects.

Our “free” highway system discourages privately-financed roads because they have to pay burdensome taxes, and fees while the government doesn’t because government agencies have the deep pockets of the federal taxpayer.

Just as an aside, why is the federal government taking over all our bicycle paths?

Meanwhile, the tax debate over the bankrupt highway fund is getting heated. If any of the politicians are recommending the transfer of some of these responsibilities and the funds to the states, it’s not been made public. That would truly be  a sustainable solution and the end-result would be appropriate to the locality instead of the one-size-fits-all bureaucracy. It would put an end to the Big Government middle man or at least reduce him in size but once the federal government has your money, they’re not giving it back.

 

REFERENCES

Downsizing the Government

Looming Highway Debate and Tax Fight

 

 

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  1. And then of course there is the small matter of the 2009 Stimulus Bill involving 800 billion dollars for ‘shovel ready projects” And the small matter of Obama caught on tape saying the shovel-ready projects weren’t “shovel ready” after all(snicker snicker). So he used the money for other things.
    On the bicycle trails, the thing that has always stood out for me is the hypocrisy of the environmental whackos who want to go back to nature and the good old days by making “trails”. They even tout them as “green”. But they are Black! And they are made out of ASPHALT.
    And they are often times as wide as a single-lane road.

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