How NOT to pay for highways
In one of those “every silver lining has a cloud” kind of situations, state and federal government road maintenance funds are dwindling as people drive less and use less gasoline per mile as they buy more fuel efficient cars. The federal government had to put $8 billion into the Highway Trust Fund because plummeting gas tax revenue, and a Congressional commission put forth one possible solution that is kicking up a lot of opposition.
Instead of paying a tax per gallon at the pump, how about you install an expensive device on your car that tracked how far you drive, and then you get a bill depending on how long you were on the road?
I really tried to come up with some merits for this plan, but frankly this tax per mile plan is just a terrible idea. If there were no other alternatives, then this may work, since we do need money to pay for roads and highways and it makes most sense to tax the actions that cause those roads and highways to wear out. But don’t we already have ways of paying for roads?
We currently pay for our roads mostly through the gasoline tax. Both the federal government and the states charge a certain amount per gallon of gasoline you pump into your car. Essentially what you’re seeing here is a problem where politicians have been reluctant to raise the gas tax to meet the needs of the programs it funds, and are looking for a different way to do so that might not seem as bad to constituents.
Problem is, its much worse than the gas tax.
There is no infrastructure needed to implement the gas tax. It’s added on to every gallon you pump at the gas station. With this plan every car would need to be outfitted with a device (that currently run in the thousands, but could be brought down into the hundreds apparently) that would track your mileage, then you would have to go to some place that you could upload this information every so often (presumably also at gas stations) and you’d get a bill for your mileage tax. So instead of raising an existing tax to fill the budgetary gap, they’d like to raise a new tax and spend billions on the devices needed on our cars, as well as the collection devices needed to get that information to the state.
As if I needed any more reasons, there is the issue of how the gas tax already encourages behavior that not only is good for the country, but also good for the environment… and even good for the roads. Which cars do you think are going to wear the roads down more? Big gas guzzling Hummers, trucks, sports cars and semis, or Smart cars, Priuses and Insights? Gas guzzlers also cause more money to flow to oil producing countries overseas, and send more pollution into the air.
Raising the gas tax to pay for roads makes much more logical sense than making people pay the same per mile if we want to wean ourselves off of foreign oil, get cleaner air and put less stress on the roads. It encourages people to buy lighter, cleaner and more efficient cars, and raising it more would decrease the time it takes to make up the difference in purchasing cost between regular cars and their more efficient brethren. This proposal would literally be a disincentive, counteracting with other government programs designed precisely to encourage purchase of more efficient vehicles.
On the bright side, Obama has come out flatly against the plan, even though his Transportation Secretary Ray LaHood has made comments in favor of the idea. Barbara Boxer supports it, which you might expect from one of the most liberal Senators we’ve got, but the only poll I could find on the subject shows that 70% of respondents (North Carolinians) are against the idea. An older poll that I dug up, showed that while most people are against a hike, 55% would support it if it “reduced the U.S. dependence on foreign oil”. An even larger majority, said they’d support it if it “resulted in less consumption or eased the threat of global warming”.
So I come back to my original problem with this proposal. If the public is against the idea, is it a disincentive for behaviors that the government is already trying to promote with other programs, adds unnecessary infrastructure and of course adds a whole new tax to complicated the already labyrinthine code we have here… then what is a single good reason to support this over a higher gas tax?
The federal gas tax has sat at the same 18.4 cents per gallon for 16 years. That it hasn’t gone up in so long is a clear indication of who is to blame for the Highway Trust Fund running out of money. Its time for politicians to suck it up and tell people they need to either cough up a few more cents per gallon, or learn to live with a whole lot more potholes.