Should Congress reduce the federal gas tax from 18.4 cents per gallon to 3.7 cents per gallon? Yes, say Sen. Mike Lee, R-Utah, and Rep. Ron DeSantis, R-Fla., who are sponsoring a bill to do just that.
Sound like a free lunch? Not necessarily. Lee and DeSantis are addressing a real policy problem which Congress has been wrestling with, not very successfully: the task of replenishing the Highway Trust Fund that is used to finance federal transportation spending. Gas tax revenues have been declining, in part because of reduced driving, and are on a glide path toward declining more in the future, because of government policies, including increased gas mileage standards. The federal gas tax was enacted to finance the Interstate Highway program in 1956. Some of the arguments for that legislation no longer apply. The Interstate highway system, as Lee and DeSantis point out, has been built. The huge discrepancy between states’ economic bases which existed in the 1950s has been greatly diminished.
Moreover, as I’ve pointed out in two different Washington Examiner columns last year, the states are already stepping into the transportation funding gap, in some cases through public-private financing. As Lee and DeSantis argue, at this point in history the states are in a better position than the federal government to identify and prioritize transportation needs.
If the states want to pay for bike paths and fixed-rail transit — which are paid for now in part by federal funds — they can do so. If they want to limit spending to highways, they can do so. If they want to experiment with smart tolling, they can do so. They are free to raise their state gas tax rates up by as much as 14.7 cents a gallon, by the time Lee and DeSantis’s reduction of the federal gas tax is phased in, without increasing the burden on their residents.
The idea that centralized federal authorities have some special expertise is increasingly rejected, and rightly so. Congress isn’t going to raise the federal gas tax; it didn’t do so when Democrats had big majorities in both houses and it’s not going to do so now. The smart thing to do is to let funding and power flow or continue to flow to the states.
