Thursday, August 25, 2011

News from Washington: How to Solve the Transportation Paradox

The solution for this problem is obvious.  Reverse the recently reduced mileage requirements so that cars must burn more gas and therefore we will have to pay more fuel taxes.  That will increase the funding for surface transportation projects such as high-speed rail with funds available from the Highway Trust Fund.  

That way, they can build high-speed rail with those funds, which will reduce car use and, unfortunately, thereby reduce fuel taxes.  In which case we should raise the fuel taxes to collect more per gallon, since we will be driving less. 

But, higher fuel costs will reduce driving. Which means that instead of driving, we all should go to the grocery store by high-speed rail, which we will build with the taxes collected from selling more expensive fuel, which we will be buying less of due to the bad economy. 

They also need to repair the highways with those transportation funds in order for more cars to run on them and burn more fuel and thereby collect more fuel taxes so that HSR can reduce car use and burn less fuel.

Since oil comes from those bad countries overseas instead of our own good old American oil, which we should burn more of, we should continue to subsidize the oil companies as an expression of our collective appreciation for them making more money than ever, which they do by selling us more fuel, which will produce more fuel taxes since we will be buying more fuel although we will be driving less.  The oil companies pay so few taxes anyhow, which is dumb of them since their taxes would pay to build more highways on which we would burn more of the fuel they sell us.

Any questions?

Tomorrow, we'll discuss why we should build high-speed rail right on top of all our highways since we won't need them any more once we have high-speed rail.  And, how that will save money on highway repair which we can then spend on building high-speed rail. Except, we won't have gas taxes to pay for either highway repair for highways which we will not need, and for the construction of high-speed rail on those highways which need those repairs.

Please be prepared to discuss. 
Congress heads for another showdown over transportation funding

By Ashley Halsey III, Published: August 23

State transportation officials are fearful that another congressional stalemate next month could shut down highway and transit construction projects nationwide and put thousands of people out of work.

Facing a Sept. 30 deadline, officials are mindful of the deadlock that occurred this month over extension of funding for the Federal Aviation Administration. That cost an estimated $350 million in tax revenue and led to a partial agency shutdown that put 4,000 FAA employees and tens of thousands of construction workers out of work for two weeks.

Both the federal authority to collect the 18.4 cents a gallon in federal gas tax and authorization to spend the revenue on transit and highway projects are due to expire.

“When Congress comes back, they’re only going to have 11 days to take action,” said Susan Martinovich, president of the American Association of State Highway and Transportation Officials. “There is a crisis brewing.”

Until the FAA extension turned into a major test of wills between House Republicans and Senate Democrats, it was considered relatively routine for Congress to extend current funding while working on big spending packages.

The Senate balked when the House sent over an FAA extension with other provisions attached. The Senate finally buckled and approved the extension, raising the fear that House Republicans might repeat the move when that extension expires Sept. 16 and when the two surface transportation measures come due two weeks later.

The state administrators said that the Senate had committed to passing a six-month surface transportation extension but that House Transportation Committee Chairman John L. Mica (R-Fla.) had not responded to their inquiries.

Although the two houses are in final negotiations over a long-term FAA reauthorization, neither the House nor Senate has approved a long-term surface transportation bill. State officials consider long-term funding plans essential because they need to be confident that funds will be forthcoming when they launch highway and transit projects.

“We need to have a long-term reauthorization of the transit and highway programs, and they need to be funded at the same level, at least in the near future, at what they’re funded today, which is about $42 billion for highways and $11 billion for transit,” Martinovich said in Louisville on Tuesday after meeting with Southern state highway administrators.

Congressional efforts to pass a major surface transportation funding bill have been hamstrung because the primary source of federal transportation funding, the gas tax, has not kept pace with the nation’s needs.

The two houses have come up with strikingly different proposals, though neither has formally introduced a bill.

The House has talked of a six-year plan to provide about $35 billion a year, a sum that Mica says can be used to leverage double that amount through public-private partnerships. The Senate proposal would provide about $109 billion spread over two years.

If the cuts proposed by the House become law, 500,000 jobs would be lost, Martinovich said. “States may need to stop or decrease maintaining a third of their highways,” she said.

But with neither bill even in written form, the immediate prospect is for twin extensions — one allowing for collection of the gas tax and the other to permit spending — when the current authorizations expire next month.

“We’re facing a far more dire circumstance [than the FAA shutdown], where the entire federal aid program for highways and transit would shut down Oct. 1 unless Congress extends the revenue title,” said John Horsley, executive director of the association of state transportation officials.

Mike Hancock, Kentucky’s transportation secretary, said state officials are watching Congress “very, very carefully.”

“Do we have confidence that Congress will take care of everything they need to take care of in the 11 days? I look back a couple of weeks, and my confidence is shaken,” Hancock said. “It’s all in the hands of our members of Congress.”

If the authorizations are allowed to expire, state officials said, they would not be able to put projects out for bid and would have to begin shutting down projects underway. Since states spend money from their own coffers and then file for federal reimbursement, they would be out on a limb if they let work continue when federal funds were no longer guaranteed.

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