Highway funding hijinks: Our view
Perhaps nothing better illustrates congressional irresponsibility more than the stopgap highway funding measure the House passed on Tuesday.
The bill would fund highway construction by allowing companies to sock away less money for their workers' retirement. Companies would pay more in income tax, as their pension contributions are non-taxable. And that additional revenue would be used to keep the Highway Trust Fund from going broke, at least until the end of May.
That's right. The House wants to undermine the long-term viability of private pension plans and increase the chances that the Pension Benefit Guaranty Corp. would be called on to partially bail out some of these plans. That action would be taken mainly because House Republicans are afraid of the special interests that demand no tax hike, at any time, for any purpose. The Senate is expected to come up with its version of a temporary road fix soon.
The Highway Trust Fund is running broke because it is funded by one of the few taxes in the federal government that is denominated as a specific amount (18.4-cents per gallon) rather than a percentage, and is not indexed for inflation. Since the gas tax was last increased in 1993, it has lost nearly half its value and would have to be raised to 30 cents now just to have the same purchasing power that 18.4 cents had more than two decades ago.
Highways and transit are core functions of government that the American people recognize as vital to their daily lives, and that companies see as important to economic growth. The nation doesn't need another temporary gimmick that keeps the Highway Trust Fund from going broke for a few months but prevents any kind of long-range transportation planning. And it certainly doesn't need a flimsy patch that encourages companies to stiff their employees' retirement.
What America needs is a way to repair old infrastructure and add to it so that the nation's booming metropolitan areas are not choked off by vehicular gridlock. The obvious near-term solution is to raise the gasoline tax back to where it was in 1993 dollars and index it for inflation. Over time, Congress should also look at high-tech toll systems on the most congested interstates.
States and local officials have raised taxes to deal with pressing transportation issues without much public complaint. They know that their constituents, while not eager to pay taxes, recognize that roads and transit are critical concerns.
Unlike many of the issues on Capitol Hill, this one is not a particularly complicated. It's time for Congress to take its cue from heartland America and put the nation's highways on a firm financial footing.
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