No matter what combination of the three "quick nickel" highway bills now before Congress is ultimately passed as a result of the current steamroller in Washington, the bill will not do the things its backers have promised. Specifically, the quick nickel will not do anything about the current severe unemployment problem (except possibly make it worse) and it will not fill potholes.
The White House (correctly) denies that this is a jobs bill. Nevertheless, the Department of Transportation tells anybody who will listen that precisely 170,000 jobs will be created. The only reason the bill is being considered at all in the lame-duck session is the great need of Congress to appear to do something about the unemployment situation.
The bill is not going to create jobs. In its early years, it takes more money out of the economy than it puts back in. Neither a Keynesian nor a supply-side economist would claim that sending more money to Washington is a way to create jobs.
If we don't have to send that $5.5 billion a year to Washington, we will presumably spend it to buy something else. If we do send that money to Washington, we won't be able to use it to buy something else. Whoever makes that "something else" will lose his or her job. Eventually, some of the money will result in creating some new construction jobs while eliminating jobs elsewhere in the economy.
Since the money leaves our pockets well before it ever comes back from Washington, the short-term effect will be a loss of jobs and not a gain. To make things even worse as far as jobs are concerned, it is unlikely that all states will be able to spend all the money that will theoretically be available to them. This federal money must be matched by state money. Since many states are already having difficulty matching the federal funds they are now eligible for, it is unlikely that these states will be able to match any more federal funds -- especially since the federal government is planning to preempt their ability to raise state gas taxes.
The bill is touted as a way to fill the nation's potholes. There are certainly plenty of potholes that need filling. However, this bill simply extends existing federal highway programs, and federal highway money is not available for filling potholes under these programs unless the whole road is repaved. As a matter of fact, the road also has to be "wide enough" and "straight enough" to meet federal standards in order to qualify for this repaving money.
There are roads that do need to be completely reconstructed. There are also other roads that simply need to have their potholes filled and their cracks sealed. It is because of a lack of pothole-filling and crack-sealing over the last decade that so many roads need to be completely repaved or reconstructed now. This bill continues the tradition of encouraging massive reconstruction rather than simple preventive maintenance.
Many states, including Vermont, already need to raise their own gas taxes this year to meet unmet maintenance requirements. It is unlikely that those states will want to impose any further "user charges" on top of a large federal increase. When states raise their own gasoline tax, they can use the money from that increase to meet their most urgent priorities -- whether those priorities be pothole-filling or new construction. It has been known for a long time that state-only projects are cheaper and can be done more quickly than projects using federal money.
It is easy to understand why those who have been frustrated by Congress' inability to pass a multi-year highway bill are jumping aboard the quick-nickel steamroller. They are afraid that, if Congress does not pass this bill now, it will never address highway needs constructively. They are willing to accept any bill, even a bad bill, as long as there is some more money for highways.
Nevertheless, a bad five-year bill passed during the lame-duck session will be worse for the nation than no bill at all. It will neither create jobs nor fill potholes. It will frustrate the ability of the states to achieve these goals themselves.
Although many states will be winners from the quick nickel, others will be substantial losers. The Reagan administration dedicated itself to a restructured federalism, which recognized the diversity of needs and problems in the different states. It is ironic that this administration is pushing a bill that extends federal decision-making even further and cripples the ability of states to meet their individual highest priority needs.
This lame-duck Congress ought to go home. After the Christmas recess, a new Congress should come back and address the nation's transportation (and other) problems in a constructive way. The quick nickel ought to be allowed to die a quick death.