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Posted at 5 a.m. on July 10, 2014
Thursday will see this year’s most consequential vote in the once-mighty House Ways and Means Committee — to propose one of the more assertive legislative punts in recent memory.
The panel will get behind a plan for patching the gaping chasm in the Highway Trust Fund for the next 10 months, after which the fundamental fiscal flaw in the nation’s main public works program will be exposed once again. House Republicans, not worried about losing control of the chamber this fall, have concluded that’s when they stand their best chance of driving a long-term solution.
The Senate is looking at a totally different approach, one that wraps the funding problem in caution tape for only five months. The Democrats there are keenly aware they may have to turn over the keys to the GOP come January, so they view the lame-duck session as potentially their last best chance to come up with a lasting fix to a problem that’s been festering for years.
Put another way, this month’s big fight over how to sidestep the edge of the transportation funding cliff is not going to be about remaking an outdated policy. Not surprising this close to an election, political positioning is at the heart of the dispute — which only will determine which party can claim the upper hand when the real debate begins.House Ways and Means Chairman Dave Camp of Michigan has decided his only viable choice is to bequeath the problem to his almost certain GOP successor, Paul D. Ryan of Wisconsin, betting Ryan can strike a deal next spring, when a whiff of cross-party collaboration is the new-car smell infusing the start of a new Congress.
Senior Senate Democrats invested in transportation policy all have reached the opposite conclusion. For them, the best hope for replenishing the trust fund for the indefinite future will come during the other period that’s ripe for deal-making — the lame duck in the five possible weeks for legislating between Election Day and Christmas. Besides, if the Democrats have lost their majority, they will be potentially eager to take the best deal they can get before Oregon Democrat Ron Wyden must hand the Finance gavel to Utah Republican Orrin G. Hatch.
The length of the inevitable can-kicking needs to be settled in the three weeks before summer recess.
The trust fund will otherwise become functionally insolvent on Aug. 1, meaning federal payments for road and bridge projects will be trimmed about 30 percent and checks will get cut only a couple of times a month. As a result most states would likely put a hold on all but emergency repairs, even though August is the traditional launch of highway construction season. If the trust fund is not replenished by fall, as many as 700,000 jobs could be imperiled — a number equivalent to all the new payroll positions created nationwide in March, April and May.
Both parties would seem to have a keen interest in preventing such an economic wound but as of Wednesday evening, the two sides seemed far apart in how to proceed.
The House GOP was pressing ahead with its plan to tide over the trust fund until May, mostly by relying on several ideas that get mentioned whenever there’s an urgent call for a “pay for” — $6.5 billion over a decade by allowing companies to delay tax-deductible pension contributions, $3.5 billion by extending customs fees, $1 billion from starving a federal program that cleans up leaky underground storage tanks.
Senators were still working to assemble a package worth $5 billion, split between higher fees and spending, to keep the fund going only through December.
The frenzied hunt for long-term paper savings to meet short-term tangible needs on the roads — as well as the arguments over the length of the interim patch — are particularly galling to those who see the big fix as both obvious and unavoidable.
It’s long past time to increase the federal excise taxes on motor fuel, in the view of an array of independent commissions, business groups including the Chamber of Commerce and the American Trucking Associations, think tanks and even some lawmakers of both parties in politically safe seats.
The 18.4-cents-per-gallon gasoline tax and the 24.4-cents-per-gallon diesel tax have long been the main source of federal road and bridge funding. But they haven’t been raised in 21 years, during which time vehicle fuel efficiency has increased while the costs of building and maintaining roads have steadily gone up.
“Congress should have the courage to pay for [better roads now] rather than cowardly throw future generations under the bus,” said GOP Sen. Bob Corker of Tennessee, who with Democratic Sen. Christopher S. Murphy of Connecticut is pushing a plan to index the fuel taxes to inflation after raising them each by 12 cents.
Corker and Murphy won’t face voters until 2018, so they have time to recover from the politically risky move of proposing a tax increase. But most members from both parties see no advantage in lining up for one during the campaign season. And neither does the Obama administration, which has signaled it won’t be advocating for higher gas taxes but won’t stand in the way if that’s what Congress wants.
Other options to pay the public works bill — closing loopholes in the corporate tax code, or deep cuts elsewhere in the domestic budget — look like non-starters. But there’s still a chance both parties could get behind a deceptively simple solution. They could re-label the gas tax a “user fee” (which it is) just before increasing it.
That could happen in the lame duck as easily as it could happen next year.