With President Trump officially exonerated from the Robert Mueller Russia probe, a cloud has lifted that should help the administration achieve more policy wins before the 2020 election. One of the top policies that our “builder in chief” should champion is a sizable and bipartisan infrastructure package.
House leadership has reserved time next month to take a hard look at infrastructure legislation.
Consider that a January Rasmussen poll found roughly 90 percent of likely voters believe Democrats and President Trump should work together in 2019 to pass legislation that would improve infrastructure. Hence, the bill should aim to revitalize our deteriorating passenger railroad systems, waterways, airports and, most notably, roads and bridges.
Achieving results will require political leaders to agree on the right path forward to adequately fund the rebuilding of America’s dilapidated infrastructure and transportation. The most reasonable plan probably includes a modest increase to the gas tax that is phased in over ten years coupled with a tangible plan to get rid of the gas tax over time in favor of a system that charges drivers by the mile. As cars and trucks become more fuel efficient or electrified, a gas tax that already fails to raise the revenue needed to support the Highway Trust Fund will only become more inept.
Therefore, a nationwide “Vehicle Miles Traveled” (VMT) program will take time to enact, so President Trump and Congress would be well suited to embrace a program that can raise $394 billion over the next decade.
Given the strong economy thanks in large part to the tax cuts and deregulatory agenda championed by The White House, now is the time to fix fundamental challenges to our transportation networks finally. The White House Council of Economic Advisors agrees, recently arguing that sustained economic growth hinges on user-funded infrastructure expansion. Even the most ardent anti-tax Republican must eventually admit that we cannot eliminate enough waste to cover the infrastructure delta and that enjoying the roads we use means paying for them.
Beneath the surface of this quandary rests a compelling and profoundly related issue that could be part of the legislative effort, an industry versus industry fight over size and weight of large trucks and the amount that these vehicles pay or don’t to use the highway system.
One side of the argument is trucking companies and select truck shipping groups who seek more massive and extended freighters. However, current regulations limit big rig trucks to 80,000 pounds and 53 feet in length. These entities cite potential benefits, including increased productivity.
On the other side are privately owned freight railroads, who rightly note that increases in truck capacity would divert freight away from rails. Free market thinkers likely think that competition among industry rival is healthy for our economy, but it is not that simple. Ample analysis shows trucks do not cover the costs they heap upon the systems that regular drivers also use, thus forcing general taxpayers to subsidize their operations. For freight railroads, who pay for the full cost of their infrastructure, this is particularly troubling because it allows truckers to deflate costs artificially. It is no free market, but instead a rigged one as currently constructed.
The rancor surrounding the issue tends to bog down the annual appropriations process and will surely impede any efforts on passing an infrastructure bill. Hence, Congress should consider a grand deal: devise a system that charges large trucks by the miles driven and the weight of their vehicle to end taxpayer subsidies and guarantee coverage of full cost. In exchange, allow truckers to increase their capacity, if the modifications are safe for road use.
In doing so, Congress will make revenue generation easier, as trucks currently cover about 80 percent of their costs. Getting to 100 percent will limit, albeit not close to wholly, the need for additional infrastructure dollars. It is a common-sense solution even our nonsensical leaders in Washington could embrace. Moreover, it will also put to bed a continuing battle that could halt progress for the Trump administration.
John Burnett is the Managing Director and Founder of 1 Empire Group consulting firm and a business executive with over 20 years of experience in the financial services and energy pricing industries. A veteran of politics, John is an official with the New York State Republican Party and ran for New York City Comptroller in 2013. An adjunct professor at Hampton University and New York University, John’s editorials on business, the economy, policy, and politics have appeared in HuffPost, U.S. News and World Report, and Washington Examiner. He is also a frequent guest commentator on Fox News, Fox Business News, New York 1, and PIX 11 News. John holds a B.S. with honors from New York University and an MBA from The Johnson School of Management at Cornell University. To read more of his reports — Click Here Now.
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