John McCain couldn’t convince Congress to adopt his gas-tax holiday, but Congress does plan on making some changes to the rate. Unfortunately, the change will go in the opposite direction, if Democrats get their wish. With Americans driving less, the highway fund faces even more severe shortfalls than expected from lost gas-tax revenue — and so the Democrats plan to hike it up by ten cents a gallon:
Despite calls from the presidential campaign trail for a Memorial Day-to-Labor Day tax freeze, lawmakers quickly concluded — with a prod from the construction industry — that having $9 billion less to spend on highways could create a pre-election specter of thousands of lost jobs.
Now, lawmakers quietly are talking about raising fuel taxes by a dime from the current 18.4 cents a gallon on gasoline and 24.3 cents on diesel fuel. …
Oberstar, D-Minn., said his committee is working on the next long-term highway bill. He estimated it will take between $450 billion and $500 billion over six years to address safety and congestion issues with highways, bridges and transit systems.
“We’ll put all things on the table,” Oberstar said, but the gas tax “is the cornerstone. Nothing else will work without the underpinning of the higher user fee gas tax.”
The problem with the transportation bill isn’t a lack of funds, it’s a lack of fiscal discipline. Oberstar figures prominently in this, earmarking transportation funds for projects like bike and walking path, visitor centers, and other nonsense instead of focusing on the infrastructural needs he decries. Over twelve percent of the last transportation bill consisted of earmarks, with projects like a North Dakota peace garden, a Montana baseball stadium and a Las Vegas history museum.
Pork is the cholesterol of infrastructure. Whenever Congress attempts to address legitimate infrastructure needs, it signals open season on the taxpayers. In that bill last year, over $8 billion got spent on earmarks — the same amount that Congress says will be the shortfall this year for transportation needs, and the deficit they need to erase by raising the gas tax.
When gas was inexpensive, Congress could get away with that. Now that fuel prices have shot through the roof, taxpayers want relief, not a greedy Congress looking to get a piece of the action. If Congress demands sacrifice, then let it start with Congress and eliminate their pet projects from future transportation bills. The gas-tax holiday may be a silly idea, but a gas-tax penalty at this point in time has to set a record for political stupidity.