This page contains a Flash digital edition of a book.
ON THE HORIZON


and Congress need to focus on finding real money. Graves said it was “with little surprise


that the president once again failed to commit to putting real, concrete sources of funding behind that rhetoric,” adding that “what the country needs is money from real sources, not promises of private investment or redirected savings.” But neither Congress nor the Obama administration seem willing to acknowledge the offer of new money to improve the nation’s roads and bridges. “It is crazy,” says Tom Donohue, currently


president and CEO of the U.S. Chamber of Commerce, the nation’s top business lobby and former president of the American Trucking Associations.


BECAUSE OF INFLATION AND THE RISE IN THE COST OF CONCRETE, STEEL AND LABOR,


FEDERAL FUEL TAXES BUY LESS THAN


HALF THE AMOUNT OF HIGHWAY


CONSTRUCTION JOBS


THAN THEY DID BACK IN THE EARLY 1990S.


Because of political realities, the industry


and its customers probably won’t be getting much-needed improvements in our nation’s highways and bridges. In a nearly unprecedented action for any


industry in America, there is one sector that firmly believes its taxes should be raised in order to improve the infrastructure upon which it depends—the trucking industry. Led by groups like the American Trucking


Associations, truckers have let Washington know it would not mind paying higher taxes on diesel fuel – if that money were reserved solely for ground transportation purposes. For decades, that’s how this nation


funded highway and bridges. Going back to 1956 when the 49,000-mile Interstate Highway System was created, proceeds from the federal tax on gasoline and diesel went into the Highway Trust Fund. The federal government, in turn, doled out funds to the states on a very favorable ratio in order to


14


build and maintain federal-aid highways. The system worked so well that for


several decades the Highway Trust Fund ran a surplus—a serious surplus. As recently as the early 1990s, the fund had a surplus of upward of $10 billion. Even in Washington, that’s real money.


WHAT HAPPENED TO THE FUEL TAX? Then a not-so-funny thing happened.


Because the federal fuel tax wasn’t indexed for inflation, it did not rise proportionately when the price of gasoline and diesel rose from around $1 to its current $4 per gallon level. Cars and trucks began to get much more fuel efficient and people even started driving less. Cash in the Highway Trust Fund dwindled to the point where Congress has had to bail it out several times with general revenue just to keep highway projects properly funded. But mostly what happened was an


evaporation of political will. No longer are politicians willing to properly fund the trust. The last increase in the federal fuel tax came in 1993 when Bill Clinton was in the White House. The last time a Republican in Congress voted for any tax increase was 20 years ago. Because of inflation and the rise in the


cost of concrete, steel and labor, federal fuel taxes buy less than half the amount of highway construction jobs than they did back in the early 1990s. The trucking industry knows that. That is


why it has been somewhat openly favoring an increase in that tax with the caveat that the money must be spent on highways – not used for general funds, deficit reduction or to pay for bike paths somewhere in Oregon. Truckers realize their time is money. And


right now bottlenecks and delays literally cost the trucking industry billions of dollars in lost productivity, wasted fuel and idled trucks and drivers waiting out the system. And although few in the trucking industry


openly say so, diesel fuel taxes are often viewed as “pass-through” costs that can fairly easily be passed onto shippers. Because diesel is such a visible cost and because fuel surcharges are basically the same for every carrier (except for the differences in truckload and LTL operations), customers say they realize the rise in diesel costs (and taxes) are a necessary component for delivering freight via trucks. In a perfect world, Washington would realize this and pass an adequately funded,


multi-year highway bill that would be paid for by an indexed, inflation-proof rise in the federal tax on fuel with those monies reserved exclusively for highways. It’s a perfect solution, but isn’t likely to


happen in Washington. Why? This is an election year. There isn’t a


politician in America – up to and including President Barack Obama – who wants to face an already polarized electorate and admit he or she has raised taxes. That’s despite that a fuel tax is, in reality, a


user fee. President Ronald Reagan even called it such when he proposed an increase in the gas tax in 1983. If I walk exclusively and don’t own a car, I pay nothing in fuel taxes. But politicians don’t have the stomach for it today. But it’s not always going to be an election


year. So let’s examine some of the underlying issues behind the highway bill, and maybe sort out where we are going with dueling bills in both houses of Congress. First, the Senate. The Senate Environment


and Public Works Committee has approved a two-year, $109 billion bill. The House Transportation and Infrastructure Committee is talking about a five-year bill at $230 billion, or a six-year bill at $285 billion. These are roughly the same levels as the current highway bill. There is a common denominator in both


bills. There is not enough revenue generated by the federal fuel tax to pay for them. In both cases, Congress must somehow find another $12 billion a year to maintain funding at current levels. If a consensus isn’t reached by March


31, a worst-case scenario has the states abandoning highway projects already in the pipeline because of uncertainty in federal funding.


AN EXPERT LOBBYIST SPEAKS U.S. Chamber of Commerce President


Donohue is frustrated at the lack of foresight on this issue. “I know something about that transportation stuff and the logistics business that goes with it,” he says with a wink, having previously been president of the American Trucking Associations. Donohue has been out front trying to


cajole Congress to act. “We have got to get a deal in the Congress


of the United States which is a long-term deal,” Donohue said at a press briefing at the Chamber headquarters across the street from the White House in early January. “Forget how much money is in it for a minute,” he added. “The way it works is the


ROADWISE | ISSUE 1, 2012 | www.mttrucking.org


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20