Can Conservatives Keep Winning On Infrastructure Spending?

Posted: Dec 30, 2014 9:00 AM

It is rare for conservatives to score a federal policy victory these days, especially with a Democrat in the White House, but as Michael Barone reminds us, just by playing defense conservatives have done exactly that on transportation. Unfortunately there are some in Congress who want to reverse these gains.

The big win for conservatives on transportation comes from two sources. First, when the gas tax was last raised in 1993, it was not indexed for inflation, so the 18.4 cents a gallon collected today doesn't go as far today as it did more than two decades ago. Second, thanks to technology, Americans are consuming less gasoline, so there are fewer gallons of gas to tax. 

Thanks to these two trends, the Highway Trust Fund first went bankrupt in 2008 and Congress has been creatively bailing out the spending program on a short-term basis ever since. Without new funding, federal transportation spending has essentially flatlined since Obama's stimulus ran out.

But that does not mean America is spending less on infrastructure. As Barone notes, states are picking up the slack:

In effect, the feds are abdicating and the states are taking up the burden. New roads and bridges are needed in some places and, more important, existing roads need to be maintained, repaired, and upgraded. More than 30 states have passed transportation fiscal measures in the last three years, according to transportation expert Ken Orski. Six have increased gas taxes. Others have increased highway tolls, floated toll revenue bonds, or passed sales taxes dedicated to transportation. “The move toward greater fiscal autonomy, self-sufficiency, and financial innovation at the state and local level is likely to grow in strength,” Orski wrote.

The gas tax, justified as a user fee, is being replaced by tolls, a more efficient measure of use. Transponder technology allows tolls to be levied based on actual use, and fees can be adjusted to discourage congestion at peak-use hours, as is being done in Colorado, Florida, North Carolina, Texas, and Virginia. There’s a move to public-private partnerships, like the one Canada is using to finance a new Detroit River bridge, in which private capital puts up the cash and is repaid from tolls. Some conservatives complained, evidently on the theory that highways are built and maintained for free. But private decision makers are likely to make better decisions than the feds about where the real needs are.

Less power concentrated in Washington. More decisions made at the local level. What is a conservative not to love?

Unfortunately there are some establishment Republicans who want to give this victory away. Sen. Bob Corker (R-TN) sponsored a bill last year that would have raised the gas tax by 12 cents over two years and indexed it to inflationRep. Tom Petri (R-WI) has advocated a similar plan in the House

Thankfully, however, there are some Republicans in the Senate who want to build on what conservatives have accomplished so far. Sens. Mike Lee (R-UT) and Marco Rubio (R-FL) have introduced the Transportation Empowerment Act which would cut the federal gas tax to 3.7 cents by 2020. States would then be able to set their own gas taxes and fund their own infrastructure projects. 

Which path will Republicans take? Will they hold the line? Empower states further by passing the Lee-Rubio bill? Or will moderates like Corker and Petri cut a deal with the White House that increases both taxes and spending?

The latest gimmick used to bail out the highway trust fund ("pension smoothing") will only keep money flowing till the end of May. 

We'll know if Republicans can keep winning on transportation by summer.