Don’t “Drill for Roads”

Over at National Review Online, I have an op-ed up explaining why fiscal conservatives should oppose House Republicans’ plan to direct oil and gas royalty revenue into the Highway Trust Fund:

A quick, temporary fix would be to raise federal fuel-tax rates, but this is a political non-starter in the current political and economic climate. If House Republicans are truly serious about improving our nation’s highway infrastructure without increasing federal tax rates on fuel, they could devolve more transportation funding responsibility to the states and support more tolling. They could also rein in the waste and abuse of highway-user revenues at the hands of pro-mass-transit special interests and their enabling politicians.

Instead, House Republicans appear ready to undermine one of the more fiscally conservative funding mechanisms in existence. A provision of the 1974 Budget Act requires that the Highway Trust Fund receive 90 percent of its revenue from users in order to maintain its exemptions from appropriations meddling. Assuming drilling royalty revenues are great enough to close the near-term funding gap, the House Republicans’ proposal would push the percentage of user-based Trust Fund revenue to well below 80 percent.

Weakening this standard calls into question the purpose of having a federal trust fund in the first place. If that were to happen, the chorus for abolition of user-pays and a reactionary reversion to general-revenue funding of highways would only grow louder. Rather than learning from our previous mistakes, we would be making them all over again.

The whole thing is here. Here’s my OpenMarket blog post on the same subject.