Tuesday, July 27, 2010

Transportation Earmarks Rescinded

A bill authored by Rep. Betsy Markey (D-CO) that calls for the elimination and redirection of $700 million in unspent transportation earmarks towards reducing the federal deficit overwhelmingly passed the House 394-23 today.

Pushing for “common-sense spending cuts,” Rep. Markey’s bill is supported by House Transportation and Infrastructure Committee chairman Rep. James Oberstar (D-MN) and House Majority Leader Steny Hoyer (D-MD).

The bill comes at a time when Rep. Markey, a vulnerable Democrat in this year’s midterm elections, could be attempting to curry favor with voters unhappy with the increasing federal deficit. Still, Rep. Markey urges her fellow lawmakers to exercise a sense of fiscal responsibility and “especially with regards to transportation funding.”

A new transportation funding bill will be debated in the House later in the week.
Read the story here.

Tuesday, July 20, 2010

Transportation funding in Pennsylvania

A stalwart of infrastructure development, Gov. Ed Rendell (D-PA) on Monday called for the Pennsylvania legislature to reach a consensus on a state transportation funding plan before the midterm elections in November. Gov. Rendell, who is serving the final months of his second and final term in office, said that a new funding plan for infrastructure would allow for needed maintenance and immediately create badly needed jobs in Pennsylvania.

Gov. Rendell’s effort to invest more money into his state’s crumbling infrastructure re-emphasizes the fact that more money needs to be spent towards infrastructure development, even in a time of grave fiscal constraints because of needed maintenance and the ability of transportation investments to quickly create well-paying jobs.

Read the story here.

Friday, July 9, 2010

High-Speed Rail as a Business Engine

Emil Frankel, Director of National Transportation Policy posted his latest entry on the National Journal’s transportation expert blog.

This week’s topic concerns the benefits of high-speed rail, which were extolled recently in a report by the U.S. Conference of Mayors. The report focused on four cities: New York, Chicago, Miami, and Albany finding that implementing high-speed rail in each of the cities made business travel more efficient, encouraged mixed-use development, and helped expand markets.

Has the uncertainty surrounding the utility of high-speed rail as a business engine been settled?

We should be careful to not blindly embrace or prioritize any one mode as the solution to our economic woes. Emil makes the point that high-speed rail, or improved intercity passenger service needs to be evaluated in the context of broad strategic transportation plans or programs that strive toward a set of clearly defined national goals. Putting in place broad strategic goals and programs can help demonstrate that there is no single solution to improving a particular region. Check out Emil’s entry here.

Thursday, July 8, 2010

Raising the Gas Tax for Deficit Reduction

Few issues incite more controversy and clamor than the national “gas tax”. With the national deficit surpassing $13 trillion, some have eyed raising the national gas tax as a strategy for deficit reduction.

Throughout history the gas tax has been utilized as a deficit reduction mechanism. When the gas tax was first conceived in 1932, for example, President Hoover used the tax revenues as a temporary means to balance the Depression-stricken economy, although the tax was made permanent under President Roosevelt. In 1990 and 1993, Presidents Bush and Clinton also increased the national gas tax in part to reduce the national deficit. So are we at that point again today of raising the gas tax as a means to balance the budget?

Comparing 1990 and 1993 deficit levels with our current fiscal condition is revealing. In 1990, the national debt was 55.9% of GDP, while in 1993, the debt level was 66.1% of GDP. As of June 2010, our national debt is a staggering 90% of our GDP. Therefore, comparatively speaking, raising the gas tax today for deficit reduction purposes would seem economically reasonable given how our deficit situation is far more pronounced than it was in either 1990 or 1993. On the other hand, a small increase would have much less of an impact on deficit reduction because of the size of the deficit.

While current economic conditions would not make the decision to raise the gas tax as a means to lower the deficit unusual, a lack of political will prevents such an increase. Congressmen on both sides of the aisle have refused to even consider raising the tax in the face of the 2010 midterm elections, and Transportation Secretary Ray LaHood has stated publicly that the Obama administration is not considering raising the gas tax. Other factors, like the perceived high ($2.75/gallon nationally) though historically low price of gas, inequity faced by rural and poorer families if the tax was increased, and the anti-tax movement have prevented any momentum for an increase from materializing. Unless there is a shift in administration policy and a real push on their part, these factors are unlikely to be overcome.

Therefore, while we might be far past-due for an increase in the gas tax in order to reduce current deficit levels, and maybe even fund a transportation bill, the political environment coupled with the chilly public opinion towards an increase is likely to prevent it from occurring in the near future even in the face of cries to lower the deficit.

Thursday, July 1, 2010

Wendell Cox on High-Speed Rail

Transportation policy expert Wendell Cox recently argued that high-speed rail is not the “silver bullet” to all of the nation’s transportation problems. In fact, he said that high-speed rail is, “greatly overstated in terms of its potential,” expensive, will not achieve the environmental benefits its proponents tout, and ultimately will not reduce traffic congestion. Adopting the plan to simply build as many high-speed rail lines as possible would be exceedingly expensive, Mr. Cox argues, and would actually harm the transportation system because it would force passenger trains on to freight tracks, which would then slow rail transport and increase trucking traffic on the highways.

Mr. Cox’s arguments highlight why a NTPP approach to transportation policy is best. Rather than having a “blind” devotion to one mode like high-speed rail, a mode-neutral approach to transportation would allow MPOs and individual states to develop strategies to achieve desired outcomes in the most cost-effective manner. In this way, while the construction of high-speed rail might be the most cost-effective strategy to achieve a particular outcome in one metropolitan region, elevating one mode of transport over another wastes already-scarce federal funds in a time of grave fiscal constraint.