So, how do we repair our infrastructure?
What ever happened to that promise on infrastructure?
Specifically bridges today. Our crumbling bridges need immediate attention; both parties and every local politician and pundit agrees. But apparently little is being done. If I’m not mistaken, there was a oft-repeated campaign promise of a hundreds-of-billion-dollars program to fix them.
But unless there’s a very large GoFundMe, or Mexico helps, taxes are the only way. And taxes are not a politician’s favorite subject, especially in an election year.
But could an obvious solution actually work? Opinion: A gasoline (and perhaps diesel) tax increase is reasonable and appropriate to fairly fund the improvements.
It would seem logical for those who most use the highways and bridges to pay most for them, which such a tax would do. Retired couples, many inner-city dwellers, and others who don’t drive much or who don’t even have cars should be spared.
The federal tax on gasoline was last raised in 1993 to 18.4 cents per gallon (24.4 cents for diesel). That was 25 years ago, and the average price per gallon, including all taxes, was $1.07.
What’s a fair increase? The inflation rate between 1993 and 2018 is about 67 percent. So if the tax were indexed to inflation it would be 30.7 cents today — an increase of 12.3 cents. Diesel would increase by 16.3 cents. But I have a soft spot for diesel trucks moving our goods across the country; they at least are not 150-pound persons being conveyed by 4,000pound SUVs.
So let’s go with 12.3 cents and 16.3 cents. Prices jump around that much anyway. We often see greater jumps than that weekly; we’re becoming inured to it.
A bit of research: According to the Federal Highway Administration, U.S. drivers use about 150 billion gallons of gasoline annually. So a 12.3 cent increase would realize $18.5 billion a year. Similarly, about 40 billion gallons of diesel fuel are sold, for which a 16.3 cent increase would realize another $6.5 billion. (But again, hitting diesel and the transportation of goods may have unforeseen detrimental effects.) Compare this with the estimated cost of repairing the nation’s bridges of $140 billion (according to the American Association of State Highways & Transportation), and a multi-year solution appears feasible.
Over a 10-year program, receipts would actually far exceed the estimated cost to repair. Additionally, state funding would be appropriate on state bridges, so the federal dollars could be leveraged as partial or matching funding. This cost saving would allow a gradual phase in of the tax increase, which would be more publicly (if not politically) acceptable.
And the jobs created! The costs would be recovered by the newly-employed construction workers paying income taxes and otherwise returning that money to the economy. Attention, coal miners!
Admittedly it would be a bureaucratic nightmare, with 535 members of Congress pushing for their districts and states. But that’s expected.
I’m not an expert; I’m just musing. But I wish someone would do something, and soon. So I can actually cross that bridge when I come to it.