Taking Exception

The Folly Of Higher Gas Taxes

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By Mary E. Peters
Saturday, August 25, 2007

America was stunned on Aug. 1 when the Interstate 35 West bridge over the Mississippi River in Minneapolis collapsed in a tangle of vehicles, concrete and steel. My department is working closely with the National Transportation Safety Board to determine why the bridge failed, and in the aftermath of this tragedy, a necessary national conversation has begun concerning the state of the nation's bridges and highways and the financial model used to build, maintain and operate them.

Many, including The Post [" Paying the Price," editorial, Aug. 21], are taking this opportunity to call for gasoline tax increases and a larger federal presence in transportation investment decisions. For a variety of reasons, a response of this sort would exacerbate our transportation system failures, not alleviate them.

A far better question than whether gas taxes are high enough is what taxpayers get if we expand our dependence on the gasoline tax. The answer is almost certainly higher gas prices, more congestion and stagnating quality of life, which is why The Post's call for a substantial increase in the nation's gas tax is ill-advised.

Our system is failing because federal gasoline taxes are deposited into a centralized trust fund and allocated based on political will. Major spending decisions often have nothing to do with underlying economics, engineering realities or consumer needs. New programs and pet project earmarks have proliferated in recent years. The 2005 transportation funding bill, for example, included more than 6,000 politically driven earmarks reported to cost some $24 billion. That's a staggering figure. The true price however is unfortunately much higher because earmarks typically represent only a fraction of project costs.

In addition to breeding wasteful spending, the gas tax does virtually nothing to reduce the explosion in highway congestion occurring in the past 25 years. Gas taxes are levied regardless of when and where someone drives, creating a misperception that highways are "free." In turn, this encourages overuse and gridlock, often at precisely the times we need highways the most. The Government Accountability Office last month released a report arguing that gas taxes are fundamentally incapable of balancing supply and demand for roads during periods of congestion. We agree.

The GAO, along with almost every expert who has studied the issue, says that direct pricing of road use, similar to how people pay for other utilities, holds far more promise in addressing congestion than do traditional gas taxes. And thanks to new technologies that have eliminated the need for toll booths, the concept of road pricing is spreading rapidly around the world.

Charging directly for road use holds enormous promise both to generate large amounts of revenue for reinvestment and to cut congestion. Ultimately, it will allow political leaders to reduce reliance on or even cut the inefficient array of fuel taxes, sales taxes and property taxes that are being funneled into transportation systems nationwide.

Finally, it would be virtual policy schizophrenia to increase our reliance on gasoline tax revenue to improve and sustain our nation's transportation systems while striving to reduce U.S. oil consumption and promote the production and use of alternative fuels. The success of one policy would by definition mean the failure of the other.

Instead of raising ineffective taxes, we need a data-driven, performance-based approach to building and maintaining our transportation infrastructure. We also need an underlying financial model that is responsive to the challenges of today and tomorrow, not poorly considered policy reactions riding on the coattails of tragedy.

The writer is secretary of transportation.


© 2007 The Washington Post Company

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