Talk about a potential infrastructure rip off!
When the interstate highway system ("1.0") was founded nearly six decades ago, the goal was that it would be funded and maintained by the federal gasoline tax. The money collected would be deposited in a trust and the interest earned would fund the system's maintenance.
Since its inception, 1.0 comprises 2.5% of the nation's lane-miles of highway and handles 25% of all vehicle miles of travel.
The problem is not that 1.0 is has outlived its shelf life and is wearing out, Robert Poole, notes. Poole believes that transforming 1.0 into 2.0 should be funded by "mileage-based user fees of some sort," proposing an all-electronic tolling system that eventually would convert a minimum of 25% of all travel from per gallon fuel taxes to per-mile charges.
For Poole, the problem is 1.0's obsolesence and the cost of constructing 2.0 which is estimated to be $983B (2010 USD). That is a problem. But, it is not the problem, The Motley Monk would argue.
The real problem is that the federal gas tax money collected over the decades has been depleted through waste and fraud to the point that the tank is running on empty. The federal government, which has collected all of those taxes over the years has never lived up to its responsibility to be a wise steward of those funds.
The Motley Monk raises two questions:
- Does anyone really believe that Congress will get rid of the federal gasoline tax?
- Does anyone really believe that a toll collection system that's based on 3.5¢/mile for cars and 14¢/mile for trucks that should fully fund 2.0 after 35 years (indexed annually for inflation) will fully fund 2.0?
Don't believe The Motley Monk?
When toll roads were first introduced in the Chicagoland area in the early 1960s, once the tolls collected paid for the system, they were supposed to revert to "freeways." That never happened as the toll road system not only kept expanding but also proved to be an immense source of political-patronage jobs.
Consider also the Social Security Trust fund. Where did all of the FICA taxes collected during the past 100 years go, to the point that the system is teetering on bankruptcy?
And, if that's not enough, what about all of those taxes that are scheduled to be collected for Obamacare? Does anyone believe the federal government is ever going to prove to be a wise steward of those funds?
"Fool me once, shame on you! Fool me twice, shame on me!"
Let the discussion begin...
To read Robert Poole's article, click on the following link:
"Interstate 2.0: Modernizing the Interstate Highway System via Toll Finance."