The White House is warning Congress that it has until August to find at least $18 billion for the federal account that funds the nation’s roads and public transit systems from going broke. Failing to fork over the money would immediately threaten to slow or stop thousands of transportation projects around the country. Even assuming lawmakers find a short-term fix, the account will face a similar $18 billion shortfall every year for the next decade, according to the Congressional Budget Office. It’s Infrastructure Week, but it’s safe to say no one is celebrating.
Democrats and Republicans agree on two things when it comes to what has become a perpetual transportation funding crisis. The first is that it will not end until they find a long-term solution. The second is that they know what needs to be done, but they are unwilling to do it.
This contradiction has been on full display in recent weeks in Washington as lawmakers scramble to bail out the Highway Trust Fund. The account relies on revenues from fuel taxes to provide the bulk of federal funding for the nation’s highways and public transportation. As a result, it has faced one looming shortfall after another during the past half-decade as Americans drive more fuel-efficient cars fewer miles and as the cost of construction rises while the fuel taxes themselves remain unchanged since 1993.
Lawmakers understand better than anyone that the current tax rates—18.4 cents per gallon of gasoline, 24.4 cents per gallon of diesel fuel—aren’t enough to prevent America’s roads from crumbling and bridges from collapsing. They’ve had to transfer more than $50 billion in taxpayer money to the trust fund over the past six years just to keep it solvent.
And it’s worth remembering what that current level of investment has bought us: a road system that was ranked 18th internationally by the World Economic Forum, behind Saudi Arabia and Luxemburg, and a transportation infrastructure that experts warn will fall apart as existing roads wear down faster than they are repaired or replaced. According to the American Society of Civil Engineers, 1 in 9 of the country’s bridges are structurally deficient, more than 4 in 10 major urban highways are overcrowded, and 45 percent of Americans still don’t have access to public transit.
“States, cities, and businesses involved in transportation need the certainty from a long-term bill—a short-term patch is not sufficient,” Democratic Sen. Barbara Boxer told the Finance Committee last week. Yet when Boxer and a bipartisan group unveil their relatively conservative proposal this week to keep the nation’s surface transportation programs funded for the next six years, she has made it clear it will come with a 12-figure price tag but no mechanism to pay for it.
The White House, meanwhile, unveiled its own blueprint late last month that was noteworthy for actually seeking to boost transportation spending by an additional $87 billion over the next four years. It was less remarkable for how it planned to do it—by relying on an injection of cash from a temporary tax increase on companies’ overseas earnings, making the proposal the latest in a string to address the short-term cash crunch while ignoring the long-term crisis.
“The only way we’re going to fix this is if everyone puts their ideas on the table and has an honest discussion on how to find common ground,” Transportation Secretary Anthony Foxx told reporters during the proposal’s rollout. Days later, however, Jay Carney made it clear that not all ideas are welcome. “We have never proposed or supported a gas tax,” the White House spokesman told reporters. House Majority Leader Eric Cantor did Carney one better later that same week, telling Reuters: “I can rule out a gas tax increase.”
Washington’s refusal to consider raising the gas tax is simple politics. GOP leaders would risk an insurrection from the right if they were to support, let alone propose, a tax hike of any kind. President Obama and congressional Democrats, meanwhile, have no interest in providing their opponents with the raw material for an election-year attack ad. (One notable exception: Democratic Rep. Earl Blumenauer, who last year introduced a bill to phase in a 15-cent hike in the gas tax and then index it to inflation. Tellingly, that bill has gone nowhere.) As a whole, politicians have been so loath to endorse the solution staring them in the face that the idea has been relegated to a parenthetical even off the Hill. As a recent report from Chris Krueger, a policy analyst at Guggenheim Securities LLC, tellingly put it: “There is not a silver bullet, other than the most obvious (raise the gas tax and index to inflation).”
There’s little argument among policy experts that those who drive on America’s roads should pay more to prevent them from falling further into a state of disrepair, and study after study has suggested that raising the gas tax is the easiest way to do that in the immediate future. In 2008, the National Surface Transportation Policy and Revenue Study Commission, a congressionally created blue-ribbon transportation panel, proposed a 40-cent bump to the federal gasoline tax, along with the increased use of tolls and other user fees. A second congressionally created panel, the National Surface Transportation Infrastructure Financing Commission, echoed those finding the following year, backing an increase to federal fuel taxes followed by a transition to a system where Americans are charged for every mile they drive.
Support for a gas tax hike isn’t reserved for policy wonks either. It also has the support of the U.S. Chamber of Commerce and other business groups, as well as environmental organizations and climate hawks that see it as a way to curb greenhouse gas emissions from the transportation sector.
Presidents in particular have a long history of being against a gas tax hike until they ultimately sign one into law. Months before Ronald Reagan signed on to a 5-cent increase to the then-4-cents-a-gallon tax, he famously declared that it would take nothing short of a “palace coup” for him to do so. George H.W. Bush eventually attempted to sidestep his “no new taxes” pledge to raise the tax another 5 cents, although that ultimately crashed head-first into Newt Gingrich and his fellow House Republicans.* Bill Clinton, too, bashed the idea of an increase while on the campaign trail in 1992, before later signing his own 4.3-cent-per-gallon tax hike in his first year in office.
But more recent history suggests such days of good policy winning out over good politics are behind us. Transportation Secretary Norman Mineta quietly pushed for a series of 2-cent increases beginning in 2005 but ultimately was rebuffed by President George W. Bush. Obama’s first Transportation secretary, Ray LaHood, learned a similar lesson but had the misfortune of being taught it in public. Early on in his Cabinet tenure, the former Republican congressman told reporters that it was time for lawmakers to consider either raising the gas tax and tying it to inflation or charging Americans on a per-mile-traveled basis. That suggestion was quickly slapped aside by the White House. “It is not and will not be the policy of the Obama administration,” then–White House press secretary Robert Gibbs told reporters.
The White House declared this week Infrastructure Week in hopes of drawing attention to the nation’s transportation woes. As part of the effort, Obama will give a speech near New York’s Tappan Zee Bridge, where he is expected to renew his calls for more funding while studiously avoiding any mention of raising the gas tax.
As for LaHood, he ultimately learned to keep his mouth shut, but his views never changed. “If Congress would have indexed the gas tax in 1993 when it was raised, we wouldn’t be having this problem now,” he said earlier this year. “We’d have the money.”
Update, May 16, 2014: This post has been updated to clarify Newt Gingrich's role in blocking President George H.W. Bush's bid to raise the federal gas tax. (Return.)