In Which the Rhetoric of Fiscal Conservatism Ceases to Convince

The Trasport Politic ^ | 10 June 2012 | Yonah Freemark

[Lorianne]

» Left with a chance to set in stone the rule that transportation funding should remain based on user fees alone, the House punts.

On Friday, members of the U.S. House took one of the most significant votes on transportation in years. A non-binding motion brought forward by Representative Paul Broun (R-GA) to limit federal transportation expenditures to receipts from the fuel tax assembled in the Highway Trust Fund was defeated, massively defeated, by a 82 to 323 vote. Translation: A large majority of the lower chamber endorsed the idea that the government should be using funds sourced outside of user fees – generally that means deficit-increasing debt — to pay for transportation investments.

Listening to the rhetoric of many political leaders in Washington, the outcome may come as a surprise. After all, isn’t this supposed to be a new age of fiscal discipline? Doesn’t everyone care about keeping expenditures in line with revenues to limit the deficit?

Apparently not when it comes to transportation. If last week’s vote proves anything, it is that support for the idea that spending on transportation should be limited to user revenues is confined to a right-wing minority so far on the sidelines that it does not even account for half of House Republicans. Faced with the choice between drastically reduced spending on infrastructure — a reduction of 30% or more if spending on transportation were to match revenues, according to some estimates (because of the fall-off in collections from the federal fuel taxes, which have historically paid for national spending on roads and transit) – or keep spending in line with demand, rather than the money available, the majority of elected officials across the political spectrum continue to select the latter.

The House’s vote comes almost 1,000 days since the transportation authorization legislation officially expired and it indicates that members of the Democratic and Republican Parties may not be as far apart in ideological terms as we might have thought. While the House GOP’s legislation announced earlier this year — H.R. 7, which would have significantly damaged transit funding — was certainly far from bipartisan, its Senate counterpart MAP-21 has just the right elements of moderation that can please politicians on both sides of the aisle, and indeed it made it through that chamber with a large majority of votes.

For a month now, House and Senate leaders have been working on a compromise between hard-core right-wing views about spending on transportation and the Senate’s moderation, and little has come of the negotiations. In fact, last week House Speaker John Boehner (R-OH) suggested that transportation spending be extended another six months, until the end of December, to avoid making any sort of hard decisions now about a long-term piece of legislation. (The current extension, which basically keeps federal spending at 2009 levels, will expire at the end of this month.) But now that it is obvious that members of both political parties really do want to keep spending going on infrastructure, perhaps compromise is in the offing.

Of course, in today’s Washington, in the middle of election season, you can’t count on anything of the sort.

Nonetheless, what choice do leaders on either side of the aisle have other than to compromise? Without a new law, spending on transportation won’t go up or down, but it will certainly remain above the levels provided for by the Highway Trust Fund. If that’s the case, why not at least make provisions for reforms of the transportation grant system, which everyone claims is too complicated already? That’s pretty much what MAP-21 does.

Republicans have demonstrated that they are unwilling to make the cuts to the federal budget for transportation that would be necessary if they wanted to honor their pledge to reduce the budget deficit; the vote last week proved that they care more about ensuring adequate investment in infrastructure (as they should!) than they do about taking out more federal debt in a period of record-low interest rates. Democrats in Washington, meanwhile, have shown no real interest in actually fighting for revenue increases through an increase in the fuel tax, major installation of tolling facilities, or the creation of a vehicle-miles traveled fee, all of which could restore the fiscal health of the Highway Trust Fund but which are considered too politically explosive to fight.

Thus here we are. Members of Congress seem to agree: The politically obvious choice is maintaining transportation spending and in the process doing nothing to increase taxes to pay for the program. Is that a big problem? Not really. But it certainly won’t do anything to reduce the deficit.

What does this suggest about the future of federal transportation spending? What seems clear is that it would be delusional to think that there will be any sort of quick return to a system in which expenditures are defined based on revenues. The grave for the user fee based model for transportation funding has just been dug a bit deeper.

[glorgau]

A bouncing check will be much more convincing.