With Barack Obama looking for ways to regain momentum on job creation, expect the President to lecture Congress on the upcoming expiration of the federal gas tax when he speaks tomorrow to a joint session just before the NFL starts its season. Since the 18.4¢/gallon levy generates around $32 billion in revenue to the federal government, mainly but not exclusively for the roads and bridges that Obama never fails to mention in his “infrastructure bank” approach to economic stimulus, he’ll also use the gas tax as a way to paint himself as a deficit hawk as well. However, the actual use of those funds are far from straightforward, as Steven Crowder explained in his latest video:
As Chris Stirewalt explained at Fox News last week, this may not be an easy sell for Obama to Congress or to voters:
The extension of the gas tax, or, as the administration likes to call it, “the transportation bill,” will provide a key early measure of the state of the Republican caucus and the attitude of the president heading into a three-month-long battle with his congressional foes on debt, taxes and jobs.
How willing are House Republicans to resist the extension? How willing are Krugmanite liberals to call for an increase in order to finance more spending? How effective will Obama be in arguing that the status quo is as good as he can do?
The tax is the Obama agenda in microcosm: The program takes money from everyone to fund infrastructure projects, some environmentally friendly initiatives and treats union workers favorably. It also shows the challenge he faces in selling a broader program of tax increases for stimulus spending. Explaining to Americans why paying 18.4 cents more for a gallon of gas is no easy feat.
House Republicans already reformed part of the transportation appropriation process this year by forcing Congress to fully fund any projects authorized in the same year of authorization. Prior to 2011, Congress would authorize projects with starter funds from the Highway Trust Fund and then have to offer a “bail out” of funding from general revenue when bills came due. That created a lot of costs that could have been avoided, as well as dragged out projects needlessly. Now they want to revoke the federal tax so that states can decide how much to tax and apply their own funds to their own projects, a good start on the necessary decentralization of transportation projects and a way to eliminate the pork-barrel mechanism for projects like high-speed rail and federal walking paths that don’t come anywhere near a state border.
If we want to start scaling back the federal government and eliminate pork, then this is one key way to put pressure on Washington.