I had the intense pleasure of visiting the White Mountains of New Hampshire in August. Although I’m happy where I am, I think I could be happy there, too, and if anyone wants to give me a family-and-pet-sized cabin halfway up a mountain, write to me in care of Chronicles.
I fell in love with the New Hampshire landscape, but even more with the attitude there. One of our oldest states, New Hampshire is as feisty and contentious as any youngster. The state reminds me of the Midwest at its (theoretical) best. It has no income tax, and no one will ever be elected governor there, they tell me, unless he or she “takes the pledge” not to initiate an income tax. The state supports itself in a fine manner with a lottery, state-owned liquor, and stiff property and sin taxes. There’s a negative unemployment rate, which means there are more jobs than people willing to do them. New Hampshire license plates proclaim the state’s uncryptic and enviable motto, “Live Free or Die.” And residents in and out of the state legislature bridle at federal interference in things they can do perfectly well themselves. In short, New Hampshire wants to be left alone to run New Hampshire.
The meeting I witnessed this summer had to do with transportation: Representatives from 40 or so states had gathered to talk about their common problems. And lo and behold, it seems the biggest problem all states have in common is the federal government.
This isn’t news to anyone in the transportation business, public or private. It probably isn’t news to anyone, period. What’s amazing, though, is that we all allow the system to perpetuate itself and grow even as we grouse about it.
Take the 1987 federal highway bill—please. It expired at the end of September 1986, and Congress adjourned shortly thereafter, proving that it really didn’t give a filibuster about the states’ problem (no idea how much federal aid money they’d have to spend in the next four or five years), the construction industry’s predicament (no work in the offing for hundreds of thousands of people), or their own failure to do something responsible with the billions of motor fuel tax dollars in the Highway Trust Fund. The highway bill wasn’t passed until April 1987, six months after it expired, which left the states in fiscal limbo and emotional hell for that long. It passed then only because Congress overrode a presidential veto.
The President thought the bill was “fat,” which doesn’t make sense, but more about that in a minute. What did make sense was his objection to what are commonly referred to as “demonstration projects.” Seventy years ago, demonstration projects were just that: projects to show how a new idea worked, or whether it would work. Today, though, they’re devised without much input from the state transportation agencies, and used mainly to make various congressmen with no engineering training look good: “You wanted a road, I got you a road and had it moved to the top of your state transportation department’s meticulously planned schedule, all by myself I’d be pleased to have you vote for me in November.” The four or five most populous states get the lion’s share of all demo projects. True, such projects make up a small percentage of the highway projects receiving federal aid, but it’s the principle of the thing.
Let’s take another look at highway federal aid itself What is the Highway Trust Fund made of? Quite simply, money that you and I pay in federal taxes every time we put fuel in our vehicles. Money that goes into the Trust Fund comes from highway users. No matter where you drive, or what the state motor fuel taxes are there, you pay a federal tax of nine cents a gallon when you buy gasoline, 15 cents a gallon for diesel, and three cents a gallon for gasohol. (There’s a six-cents-per-gallon federal tax exemption on gasohol, which is another story itself) The money goes to Washington and into the Trust Fund, to be returned to the states strictly for surface transportation purposes. User fees: What a brilliant concept, hey?
Except that those boys in Washington get their hands on that money and kind of lose hold of reality. They make some states “donor” states, meaning that they get back from the Trust Fund less than the federal motor fuel tax that drivers in their state contributed to it. Other states are “recipient” states and get back more than they put in. (Naturally, donor states feel more strongly than recipient states about getting the federal government out of their hair.)
The feds also put unrelated stipulations on the states’ getting back the money they have coming to them. Compliance with clean air and water standards, the national speed limit, and a 21-year-old drinking age are some of the current hoops states must jump through before Washington tosses them the bone it took away from them.
But that’s not the worst of it. Even when all the criteria are met, states don’t receive permission to spend all the money they get. For instance, my state has been “authorized” about $100 million in highway federal aid this year. That’s like being told that we have $100 million in the bank. But our “obligational authority”—the amount we can actually spend—is only about $60 million. It’s this way for all 50 states: a total of almost $10 billion sits untouchable in the Trust Fund. And not one of the transportation experts I know can offer a better explanation than that because of federal accounting procedures, spending the money would make it look as if the national deficit had been increased. All together, class: Highway transportation does NOT contribute to the national deficit. The Highway Trust Fund is self-sustaining. For one thing, the Byrd Amendment prohibits spending more than comes into the Fund—another brilliant concept.
The money Congress so arrogantly dribbles back to the states comes from people who live in or drive through the states. These people have been promised that the rather high motor fuel tax they pay will be used to improve and maintain the American surface transportation system, so crucial to our defense and economic well-being. But not only is the money taken from us and then used to tease us into conformity on unrelated issues, it’s also in danger of being squandered on other than transportation purposes. Congress periodically considers using current Highway Trust Fund money, or raising federal motor fuel taxes and spending the increase, to balance the budget. This would mean, just for instance, that highway user fees would pay for abortions, divorces (by means of welfare and AFDC checks), and art grants to the criminally untalented. Then there’s research: The Department of Transportation is reluctantly concluding a long, congressionally mandated study of how to stop big trucks from splashing rain water onto passing cars. (Their conclusion: You can’t.) This oft-proposed raiding of Junior’s hard-earned college fund to throw an orgy is just not the behavior of conscientious adults—but, then, is anyone surprised? Remember, these fellows—and gals, I’m reminded to say—sneaked themselves a substantial salary increase while they sat on the highway bill and let the states sweat it out for six months.
The feds’ interference has turned a simple, honest concept—users paying for the services they receive—into something complicated, arbitrary, and more than slightly malevolent. They’ve insinuated themselves into a function that the states could do better, and hold us hostage by threatening us with the loss of money they have no ethical claim to. It’s unconscionable, and it’s S.O.P. Live free or die? Go, New Hampshire!
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