Easy Jobs Program with (Little or) No Added Taxes
As the subject seems to have finally changed in Washington, It may be time again to consider the actual problem with the economy, jobs. Yeah, sure, some tell us government debt, size and regulation are the problem. Some say jerking the safety net out from under the poor and elderly is the problem. When we are quiet and sitting in our thinking chair however, we all know we have a jobs problem. Yep, contrary to what some will tell you, the basic reason we have a debt problem is that ten or twenty million tax payers aren’t. There is also another myth floating around out there in political world. “Government cannot create jobs.” That myth ignores what I argue is probably the most visible example of how exceptional America really is.
Part of our exceptionalism is good ole government bid and gas tax payer financed Infrastructure.
Yeah, it drives conservative politicians crazy. Those politicians who can’t stand any kind of government program can’t deal with a transportation system which, in spite of them, works pretty well. Since they cannot bear to admit success, we hear them talk about gimmicks like toll roads and infrastructure banks. Truth is, the system of building and funding transportation is pretty simple. You drive, you buy gas, and you pay for road construction and maintenance. Some of the money we pay at the pump stays at the state or municipality and some goes to Washington. In Washington, people plan a National Highway System (NHS) because it would not make sense to plan a national system on a state by state basis. If the states help build the NHS they get the federal gas tax back. In its simplest form, that is the program which has worked for years.
At least it worked until politicians perverted the system.
Sometime after the early nineties, politicians decided to ask departments of transportation to continue to build, improve and maintain a dollar’s worth of roads for some fraction of a dollar. Instead of tying gas taxes to inflation they chose a flat rate gas tax and refused to raise it. In the early part of this decade, when hydrocarbon dependent building materials like asphalt, steel and concrete were doubling in price, transportation funding stayed the same. Another thing politicians did to transportation was intermittent funding. See, transportation is slow laborious process. Projects contemplated today will not be bid and constructed for years. Many times, to get good bid prices for the tax payer, the projects are divided into smaller pieces. Because projects have to be divided and the time it takes to complete projects is extended, properly planning projects requires uniform funding. The funding over the past two decades has been anything but uniform. Due to congressional bickering, stopgap or continuing resolutions (CR) have become the norm. When planning transportation, states need continuity not a new CR every month. States are not blameless in this new transportation world. Their politicians have also resisted gas tax increases since the early nineties.
State and federal politicians have failed the constituents in another crippling way.
Politicians have a way of subtly forcing transportation officials into building new capacity instead of maintaining existing transportation facilities. New roads get votes. Politicians love to attend ribbon cuttings on new bridges and roads. They especially love a ribbon cutting on a new road which the politician earmarked (but, that is another article for another day). Repaving a road, replacing and repairing old bridges doesn’t make headlines like a new road or bridge. This trend has piled up quite a list of undone maintenance work which is a debt just like the celebrated national debt. It is a bill our children will have to pay in gas taxes later.
A gas tax increase would the one of the purest least regressive tax increases which could be passed. If an increase was contemplated, indexing might be the least objectionable to politicians. This would be true because politicians could say no taxes would be increased until the price of hydrocarbons increase. Only when the costs of building materials increased again would higher taxes be required.
We understand, sadly, gas taxes will not be increased, no matter how many lose their lives on dangerous roads and bridges or how much economic damage occurs due to congestion.
With no gas tax increases on the horizon, the best jobs bill may be a six year highway bill at the new “debt reduction” price. This will again give certainty to the states to plan projects which will create jobs. Yes, government programs do create jobs. I am on the front lines every day and I can tell you unequivocally, road and bridge contractors have lain off and will continue to lay off workers until long term certainty is restored. Politicians have proven jobs are not a priority in the FAA debacle. Those same politicians will dodge the question of infrastructure jobs with toll roads and infrastructure banks. They will ignore a 200 year tradition of good infrastructure jobs and say things like government can’t create jobs. While they ignore or are in denial about the state of our infrastructure, we go backwards in job creation. While everybody in the world doubles us in infrastructure investment, our politicians find reasons to fight instead of creating jobs. Those politicians who really care about jobs will quit cracking jokes about whether or not a project is “shovel ready” and get down to the serious business of giving certainty to an industry which is on its last leg.
11 Responses to “Easy Jobs Program with (Little or) No Added Taxes”
Ban farm machinery.
DLS,
Amazingly enough you have hit on the newest trend. Apparently, Grandmaw Kettle driving 40 mph on an Interstate is questioned. We build these facilities to handle large amounts of traffic and one driver talking on a cell or otherwise driving at speeds dramatically slower than the posted limit causes enough congestion that we could have built a much cheaper two lane road. Safety is also a concern. Turns out accidents are more prevalent when there is a large speed differential. In all cases, the taxpayer is getting much less than he paid for. All of that being said, I am personally not sure how to fix it. Enter, I guess, the slow driver Gestapo.
DR
Though I question how much of a jobs engine it is, I’m all for infrastructure investment and for raising the gas tax to fund it. This fall we San Franciscans get to vote on a bond measure to fund street maintenance, despite having defeated one in 2005. We have plenty of streets to fix, but a bond measure seems an expensive way to delay figuring out how to pay for them.
D.R.,
I was kidding about the ban on farm machinery — it simply is an excellent (smart-assed) suggestion to make whenever someone mentions unemployment or the need for a big jobs program. (It’s possibly a conscious choice among many new farmers, urban or rooftop gardeners, etc., as well as conventional yard gardeners.)
I’ve been one of those in late 2008-2009 to say that we should give the Dems a chance at a stimulus, but also that it should be a serious one, which would include infrastructure: the two biggest examples I gave was upgrading (uprating) the transmission lines in this country (the better-known part of the “grid”; nobody thinks about distribution, the power lines found everywhere that supply houses, businesses, industrial facilities that don’t have their own generation), and road projects, which mean repairing or replacing deficient bridges (you’ve no doubt seen my links to the DOT Web site),
http://www.bts.gov/programs/geographic_information_services/maps/structurally_deficient_bridges_on_the_national_highway_system/entire_us/html/entire_us.html
(Examine your state[s] of interest at your leisure)
http://www.bts.gov/programs/geographic_information_services/maps/structurally_deficient_bridges_on_the_national_highway_system/
and Interstate projects, new construction as well as upgrades that have been long sought. (In LA metro, complete the 710; dream projects would include a new freeway CA-39 and an extension of the Slauson or Century freeway all the way across to Santa Ana Canyon where the 91 goes from east Anaheim to Corona. In the Bay Area, a dream project is the long-sought Southern Crossing as well as more practically, finishing the new eastern span of the Bay Bridge. A more interesting rural project would be extending I-17 from Flagstaff (probably starting an all-new segment offset from the existing 17, taking the route of the US highway through Indian country north to Marble Canyon) well into Utah to join the I-15 somewhere, or perhaps some other Interstate new Salt Lake. And of course, the stimulus should have been used to get rid at last of BREEZEWOOD.)
As for the older drivers, just wait another 10-20 years — not only for the Baby Boomers to start having problems, but their parents earlier. I’ve thought and posted about this before: there will be plenty of people who can hire drivers, a new job for many people incidentally, but many won’t be able to, so collective transport will be more pursued as may be smaller-scale living. Many older people “living in cities” actually will not reside there, but visit there from the exurbs when they want to be lively. It’ll be interesting about more hired drivers (by private firms and perhaps by governments) to serve (also private or public) many new public housing facilities and nicer (and pricier) private facilities for the future elderly. (Senior rec centers or community centers might be the future use of some school facilities, too.)
J,
Infrastructure is expensive. Asphalt is 60 a ton. Concrete is 150 a yard. I don’t even want to talk about the labor to put it in. Actually, prices are a little cheaper today than they were 3 years ago. When oil was 150 a barrel, asphalt was 80 or 90. Add in the hoops we jump through-Making sure taking a home or business is a last resort. Making sure we don’t kill an endangered species. Writing bullet-proof plans and specs the contractors bidding can’t take advantage of- Building/fixing roads and bridges is expensive. Interstates are 11,000 a foot.
The rewards are just as high. I heard or read the potential savings of the now famous High Occupancy Vehicle lane on the 405 in LA was a million an hour. When you think about it however, for each rider, you have taken one car off the road. That is a pretty big reduction.
Just remember not to gripe about pot holes if you vote against it.
DR
DLS
Since I am a Certified Bridge Inspector, I have seen the charts you link. Most people have no idea some of the bridges they drive on every day are on their last leg. In my state, in 10 years, over 60 percent of our bridges will exceed their designed life span (50 years). The maintenance we perform over these last 10 years for those bridges is critical in determining whether we can repair or replace. We may be shortsheeting maintenance at very critical time. This is one of the few instances in government where 10 cents saved today will cost you a dollar tomorrow.
DR
Not sure what happened to my comment.
But of course I’m going to vote against it. A bond measure is no way to fund ongoing expenses like road maintenance. San Francisco spends 1% of its budget on road maintenance. If we need to spend more, we should either redirect some of the other 99% or raise taxes, not sweep the issue under the rug with a bond measure.
D. R. Welch wrote:
And you know it’s not because it’s been decided to replace the bridges, usually (as has been true with truss and cantilever truss bridges, about which I’m sentimental, being replaced by cable-stayeds).
Note that maintenance should be paid for by taxes; it’s new bridges, all new construction that should be paid for possibly by debt.
(I grew up in California and detested those toll booths at the Bay Area water crossings that remained in place after the bridges had been paid for. Along debt, we were cursed with toll booths and all the traffic problems resulting from the roadway obstructions.)
D. R. Welch wrote:
Is that per lineal (linear) foot, for a minimal, at-grade roadway construction, no embankment, certainly not a depressed highway (below grade), and truly not a grade separation? Two or four lanes in each direction, D.R.?
I had asked more than once about key places where ped-bike bridges could be placed, that make sense, and the transportation people I talked to on the phone (who agreed those places made good sense) said at the time, mid-1980s, that a ped-bike grade separation, with tiny live loads and dead loads compared to freeway traffic with big rigs and busses, was $1 million a square foot (not lineal foot). That was to support overhead foot-bike traffic. $1 million per square foot.
DLS,
My number comes from an average rural interstate, average grade seperations (think it is one per 5 miles) and average topographic relief. The number is just llike every other number thrown out around here. I have to admit I use it for shock value when I address the public. People’s mouths usually hang open in the rural south. You are correct, urban interstates are much more expensive. When you start telling people numbers like a billion a mile, their eyes glaze over.
DR