U.S. Chamber backs Oberstar on transport bill
Postponing action on a new six-year surface transportation bill that includes a gas tax increase will only make funding choices more difficult in the future and undermine a key platform of the economy as the nation tries to recover from the recession, two business leaders said Wednesday.
The Senate is moving ahead with an Obama administration plan for a short-term fix to the transportation funding problem to allow more time to revamp transportation policies and find the money to support highway and transit programs. The administration has called for an 18-month extension of the existing SAFETEA-LU blueprint that maintains current funding levels and supplements the shortfall in the Highway Trust Fund with a $20 billion transfer from the general fund. SAFETEA-LU expires on Sept. 30.
The White House opposes raising gasoline and diesel fuel taxes for highway programs on the grounds that it would add to the burden of Americans trying to cope with shrinking incomes during the economic downturn.
But U.S. Chamber of Commerce President Thomas Donahue and Steve Odland, chairman and chief executive officer of Office Depot, said now is the ideal time to commit to an investment plan because infrastructure spending can act as a second economic stimulus and provide the needed capacity to handle increased passenger and freight movements when the economy rebounds. Donahue and Odland spoke at a press conference to highlight the Chamber's lobbying push to make reauthorization a top priority.
'Just damn do it,' the outspoken Donahue urged Congress, 'because we've got a window of opportunity and if you do you're going to put people to work, going to improve the productivity of the country and strengthen the economy. If you wait, you're going to be doing it in the midst of a lot of other issues and you're going to be held responsible.'
Other political observers, however, note that there are already a host of major issues on the agenda that are taking lawmaker's attention away from transportation.
Odland said the government should take advantage of the breathing room afforded by the downturn to get major transport corridors and metropolitan areas flowing better instead of waiting until congestion returns to crisis levels.
And, he added, now is the best time to raise gasoline and diesel taxes, which have not been increased since 1993 and have had their buying power eroded by inflation.
'The time to raise fuel taxes is not when gas is at $4.50 a gallon — an all-time record high — but when it has receded down to a lower level,' he said.
Odland, who served on the National Surface Transportation Policy and Revenue Study Commission that produced a road map in January 2008 for correcting underinvestment in transport infrastructure, also challenged the administration's rationale for not considering an increase in the fuel tax.
• Senate committee advances short-term transport fix
'The idea that people don't want to raise taxes is laughable' considering the administration's support for cap-and-trade climate legislation, health care reform and income tax increases that will raise costs for ordinary citizens, he said.
'What we're saying is stop raising those taxes and start with the user fees that will get our economy growing again. The idea that you are not willing to raise those taxes but are willing to raise every other tax in America — that's silly.'
The commission recommended that all forms of government and the private sector:
' Increase investment to at least $225 billion per year for 25 years (compared to $85 billion today).
' Increase the motor fuels tax 5 cents to 8 cents per year for five years.
' Institute new freight fees.
' Eventually transition to a distance-based user fee.
Odland called it a 'shovel-ready' plan that the federal government should adopt. Rep. James Oberstar has incorporated many of its ideas in his $500 billion draft legislation that he intends to move rapidly through the House, but he has not yet addressed new funding or financing sources.
Oberstar is on a collision course with the White House and the Senate, which was not expected to move soon on transportation legislation even before leaders endorsed an extension. At a hearing on Thursday, Oberstar said an extension 'achieves little more than to kick the can down the road on critical reforms,' and leave the transportation system with 'outdated and inefficient programs, and even higher investment needs in all modes of our transportation system.' Failure to pass a comprehensive bill also creates uncertainty for states and metropolitan planning organizations that depend on federal funding stability to plan long-range projects, he added.
Concerns about the price tag should be balanced against the $87 billion annual congestion cost in wasted fuel and productive time, Odland said.
The chamber, which normally advocates for lower taxes, has said it supports an increase in fuel taxes if they are dedicated to infrastructure projects of national significance, and program changes are made to reduce waste and increase private sector funding sources.
'The largest business organization in the world is saying that our members are prepared to pay increased user fees. We're not asking for anything. We're asking to give to help make this thing work for our economy,' Donahue said. ' Eric Kulisch