Why a Gas Tax Extension Is No Longer Enough to Save Our Roads, Jobs — or Economy

By Jennifer Warburg
September 8, 2011
Minneapolis's 2007 bridge collapse was caused by a design flaw, but failure to maintain our infrastructure could have similar results. Image courtesy Flickr user insipidlife

On Tuesday, Congress returned to Washington with only 11 days to pass essential legislation: the reauthorization of all major national transit and highway projects and the gas tax that funds them. Stalemate or delay will cost billions of dollars and millions of jobs, shutting down highway and transit construction projects nationwide and putting hundreds of thousands of Americans out of work in the midst of an unstable, jobless recovery.

Passage of regular infrastructure spending packages used to be routine in Washington, but in today’s fractious Congress, all bets are off. Already this summer we’ve witnessed costly Congressional standoffs over the raising of the debt ceiling and the funding of the FAA — other spending measures that used to attract bipartisan support.

In less contentious times, a federal surface transportation bill is passed roughly every six years. This regular package uses our current gas tax of 18.4 cents per gallon to generate the billions of dollars necessary to maintain our interstate highway network, many transit systems around the country, bicycling and pedestrian facilities, and freight-rail operations.

Even in periods of divided government, infrastructure investment has typically provided an area of consensus. Investment in reliable roads and transit provides immediate construction jobs and lays the foundation necessary for long-term economic growth.

Yet in today’s hyper-partisan environment, the two parties have failed to agree upon a new bill, allowing nearly two years to pass since the last package expired. During this time the nation’s infrastructure has relied on a series of tensely negotiated extensions that provide no new direction or funds for the improvements desperately needed to the country’s decaying bridges, highways and transit networks.

The mounting shortfall in government spending is undermining the economy more and more. The most recent report by the American Society of Civil Engineers states that “glaring deficiencies in America’s surface transportation systems drained households and businesses of nearly $130 billion last year, including about $97 billion of increased costs to operate and repair vehicles and $32 billion of increased travel time because of congestion and delays.”

Investment is sorely needed, but the latest temporary measure authorizing spending on federal infrastructure is about to expire, and the divided Congress is likely to spend the next two weeks bickering over another mere extension.

In fact, what is desperately needed is not another extension, but a new long-term bill — one that raises the gas tax.

In most of the developed world, users pay a duty on gasoline at the pump. The revenue goes directly into investment in the country’s transportation infrastructure. Since 1932, maintenance of the United State’s transportation infrastructure has been largely funded through this kind of user fee. Every president Since Herbert Hoover has raised the federal gas tax to keep apace with the country’s transportation needs. Presidents Reagan and Bush Sr. raised it the most of any. But since 1993 the fee has been stalled at 18.4 cents, a mere 5 percent of the $3.62 that the average American paysfor a gallon of gas and about a tenth of what the average European pays.

Our political leaders’ failure to raise the tax for the last two decades means the Highway Trust Fund faces what the Washington Post calls “a near term insolvency crisis”— just as most of America’s midcentury infrastructure has started to need upgrading. Experts from Gregory Mankiw of the Wall Street Journalto Dan Akerson, the CEO of General Motorshave insisted a gas tax is necessary to maintain safe and functional roads, bridges and transit — and to reduce the economic losses caused by the inadequacy of the country’s transportation network.

Our current gas tax is much too low to support a first-world level of infrastructure. And we will be lucky to see it merely extended this fall. Raising the gas tax is a political non-starter in a Congress cowed by the specter of the Tea Party.

What the United States really, desperately needs is not another temporary extension, arrived at after extended and wasteful posturing. We need real investment in our roads and transit. That means passing a comprehensive new surface transportation bill and raising the gas tax to a level that can support first-world transportation infrastructure for our first-world (last time we checked, anyway) country.

For more information, visit Transportation for America and America2050.