Congress gets back to the Capitol this week following the Fourth of July recess, and will have only three weeks or so before the DOT may have to start rationing Highway Trust Fund reimbursements to the states.
The administration spent the holiday break trying to turn up the pressure on lawmakers, with both President Obama and Transportation Secretary Anthony Foxx warning of the consequences if the trust fund doesn’t get a cash infusion and if Congress can’t get a transportation reauthorization package through both houses.
The White House, however, is firmly committed to its scheme that would fund a new transportation bill through corporate tax reform – a notion that Congress quickly rejected.
Yet Obama has consistently rejected any suggestion of a gas tax increase — though he does favor giving states the freedom to toll existing Interstates. And while many in Congress likewise have shied away from the gas tax, there has been a growing realization that such an increase is the only readily viable option. (Congress is also a little peeved that the president calls them out on transportation funding, but has no serious plan of his own.)
Meanwhile, the construction industry, big labor and business groups – including the American Trucking Associations – continue to sound the alarm that Washington is putting thousands and thousands of jobs and global economic competitiveness at risk.[related-post id=”97590″/]
Over the holiday, a New York Times op-ed by economist Paul Krugman noted that housing and road building compete for labor and resources during good times, but the housing bust has made both readily available for road construction, while federal banking policy has made borrowing for such projects cheaper than ever. So focusing on an infrastructure upgrade should have been “a no-brainer.”
Instead, infrastructure spending has plunged, “an almost surreally awful wrong turn,” Krugman writes. “We’ve managed to weaken the economy in the short run even as we undermine its prospects for the long run. Well played!”
Still, some more conservative lawmakers and public policy groups insist the sky is not falling.
Heritage Action communication director Dan Holler pointed out in a blog post last week that the 28 percent reduction Foxx mentioned is from the federal share of state spending, which is about a quarter of state transportation budgets.
“In other words, the ‘crisis’ Obama is warning Americans about is a 7 percent reduction in total spending,” Holler writes. “Bottom line: America is not facing ‘a transportation government shutdown’ and lawmakers should stop trying to create an artificial crisis which they can use as an excuse to raise taxes or increase spending.”[related-post id=”97260″/]
And, for a lawmaker with zero tolerance for any tax increase, that simple math might be enough – except for Krugman’s point that there’s no better time than now, financially.
And except for the condition of the transportation system.
Still, it’s easy just to say that Congress is broken – but that doesn’t solve anything. So I have a modest proposal: Let’s bring back earmarks.
“Egad, man!” you’re thinking. “The last thing we need now is another Bridge to Nowhere!”
But a couple of former DOT secretary’s with whom I chatted recently, as well as some current movers and shakers in Congress think maybe a little bacon grease, if used judiciously, could get the wheels turning again.
So tune in to part two for brief return to yesteryear, and remembrances of bipartisanship past – back when highway bills were long-term and big, important projects got funded.