POTHOLES AND POVERTY - OR SOMETHING BETTER

Recently, Congress acted to extend the 18.4 cent Federal gasoline tax to the end of March, 2013.  The fact that extending the tax was contentious is a sad commentary on the lack of both planning and wisdom that characterizes our national legislative process. 

  

The tax, which has not been raised since 1983, is clearly inadequate. In 2008, the Highway Trust fund – which is the fund intended to support transportation improvements in the U. S. – ran out of money.  Spending from the Trust Fund has exceeded revenues since 2002.  Although Congress has plugged the gap with revenues from the General fund, it has failed to come up with an integrated plan – and a funding program –to assure adequate maintenance of our existing assets and provide the improvements needed to assure competitive capabilities in the years ahead. 

Allowing the gasoline tax to lapse would, among other things:

•  Encourage people to drive more, thus worsening the already severe congestion that irritates us all – and costs more than $100 billion annually in extra fuel costs. 
•  Increase our negative trade gap, and increase our  energy dependence  
• Cost lots of jobs.  1billion in infrastructure spending supports about 25,000 jobs; if the tax lapses and we stop spending, hundreds of thousands of jobs will be in immediate jeopardy. 
• Accelerate the already severe deterioration of existing bridges and highways

It’s hard to understand why anyone would even consider allowing the tax to lapse.  Americans pay far less for gasoline than driver’s in other countries, and much less in fuel taxes as well.  The recent Simpson-Bowles Commission recommended an immediate 15 cent per gallon increase in the tax; others have suggested more substantial increases.  Everyone except politicians seeking votes seems to agree that our infrastructure needs immediate and substantial help. 

It is clear that it does – and that the needed help will cost lots more than another 15 cents a gallon at the pump.   In 2008 the national Surface Transportation Policy and Revenue Study Commission – a Congressional creation – recommended spending at least $225 billion annually, far more than we now spend. Various estimates put the bill for deferred maintenance of our highways and bridges in the neighborhood of $2 trillion.

     

In addition to needing lots more maintenance on our roads and bridges, we also need an integrated plan to upgrade and expand our capabilities in many areas. We need a plan that measures the adequacy of our highways, mass transit capabilities, airports, ports, communication systems, energy transmission systems,  waste facilities, water systems, hospitals, law enforcement facilities and educational assets against those of other countries – and that provides for the many and substantial  improvements needed to put the U. S. back in a position of leadership. 

Around the world, our competitors are spending far larger shares of GDP on infrastructure improvements than the U. S.  Brazil, India and China, are reportedly spending more than $1trillion annually! And we are clearly falling behind. 

In 2005, the World Economic Forum rated the U. S. # 1 in economic competitiveness; today, we are ranked #15. Unless we fix the problem, we’ll rank even lower in the years ahead.  

Solving the problem is a necessity if we want the country and our kids to have a satisfactory future– and stepping up to that necessity also represents an opportunity to solve one of today’s major problems. If Congress and the President were to come up with a national infrastructure plan this fall, and fund it at just $200 billion annually for the next ten years, we’d generate about 5 million new jobs.

Although it is clear that $200 billion will not be sufficient to meet the competitive challenge being mounted by others, it will be enough to  provide a big chunk of the roughly 12 million jobs we’ll need during those ten years to put the currently unemployed back to work and provide opportunities for new workers.  Moreover, the economic activity created and facilitated by that infrastructure investment will drive GDP growth, create lots of additional employment opportunities and – hopefully – provide the resources needed to build the capabilities not included in the initial plan. 

     

Some will doubtless say we can’t afford it. In my view, these are investments we cannot afford to forego.  Moreover, since we have spent or committed between $3 and $5 trillion during the last ten years in Iraq, Afghanistan and other military adventures – spending which has produced nothing and has yielded neither assets nor infrastructure to support our future growth – I just don’t buy the argument that we can’t find a way to finance the assets and capabilities needed to assure a decent future for our kids and grandkids.

Those interested in a more comprehensive examination of our infrastructure problem can find an excellent recent report here:

http://www.rockefellerfoundation.org/news/publications/falling-apart-falling-behind

 

ENOUGH ALREADY

I recently came across a very sad and powerful video about the impact of Agent Orange, a chemical which was heavily used by the US during the Vietnam War.  The video gave me fresh reason to doubt the truth of my long held hope that the US is the good guy in any fight.  It also led me to wonder if anyone now thinks that saving the people of Vietnam from the “scourge of Communism” was worth the price the Vietnamese people – and our own US veterans of Vietnam – are now paying for providing that rescue. If you think it was, watch  

http://www.brasschecktv.com/page/20452.html

During the Vietnam years, much was heard about the domino theory, the idea that if Vietnam became a communist state, all of the neighboring states would topple, like dominos.  60 years later, that concern seems ludicrous.  Since Vietnam we’ve moved on to other threats, including the topic of the day – an Iranian nuclear weapon -- which many in Washington find so terrifying they seem willing to start still another war to prevent Iran from succeeding.     

How serious do you think that threat will seem 60 years from now?  My guess is it will seem equally ludicrous, and that the world by that time will have moved on to new concerns. 

The US has been either at war or fighting someone, somewhere, during most of my lifetime.  We have been in Afghanistan for more than a decade, and are only now ending our long involvement in Iraq.  Of course, most of us don’t notice, for we no longer ask our citizens to fight our wars – we have volunteers – and we don’t bother to pay for them either.

While our leaders scrupulously avoid the subject, we all ought to pay attention, for the costs of these engagements are stupefying.  To date – as of September 30 – 6,579 US troops have died in these two wars, and 49,871 have been wounded. In total, somewhere between 225,000 and 250,000 people – most of them civilians -- have died, another 350,000 have been wounded and more than 7.8 million have been displaced. 

Causing all that damage has cost us enormous sums.  According to a recently completed study by Brown University’s Watson Institute for International Studies, the wars have or will cost $4.4 Trillion, not counting $1 Trillion in interest costs on the money we’ve borrowed to pay the bills and excluding lots of other costs that are very difficult to measure.     http://costsofwar.org/

Most people have no idea of how much a trillion dollars – a thousand billion – really is.  A trillion dollars laid end to end would reach the sun and if stacked one on another would make a pile 80 miles high.   If you spent a dollar a second, a trillion dollars would last you 32,000 years. And a trillion dollars will buy a lot of the things America needs as well. 

A trillion dollars would pay the salaries of every teacher in the country (about 2 million people) for roughly nine years. It’s enough to hire 2.5 million people at $15.00 an hour for the next 10 years (can you think of work for them to do?). It’s enough to write a check for $3,400 to 300 million people (almost everyone in the US).  It’s a gigantic number – and we’ve wasted more than five times that much while killing or wounding more than 50,000 American soldiers and accomplishing, so far as I can see, absolutely nothing.
  

I’m sick of war and the maiming and killing of our own and others’ kids.  And I’m sick of hearing that we cannot afford to repair our infrastructure, improve our educational system, pay for health care, continue government research and development and develop our energy resources to achieve independence – all the while dumping unthinkable sums in foreign wars that achieve nothing. 

All the carnage is a great waste.  World military spending now amounts to about $1.63 Trillion, about 2.6% of world GDP and approximately $263 for every person in the world.  The United States spends about 41% of that total – more than China, Russia, France, the UK and the next ten countries all combined.  

We all want to be safe.  But if we pulled in our horns, let other people and other countries choose their own way, and brought all our troops home, we could cut defense spending by 50% and maintain armed forces formidable enough to discourage anyone who might think about attacking us.     I think it’s time – and way past time – for us to do so.

Enough already.