A new poll from Benson Strategy Group and SKDKnickerbocker found that 67 percent of Americans oppose increasing the federal gasoline tax by 15 cents, or an 80 percent increase from the current 18.4 cents per gallon tax. This is broadly in line with previous polls that found Americans strongly oppose fuel tax increases.
But this poll posed a question that is nominally on the table. Rep. Earl Blumenauer (D-Ore.) introduced the Update, Promote, and Develop America's Transportation Essentials (UPDATE) Act, which would increase the federal gasoline excise tax 14.9 cents from 18.4 cents per gallon to 33.3 cents per gallon, and the federal diesel excise tax the same amount from 24.4 cents per gallon to 39.3 cents per gallon. This has little chance of going anywhere and the only co-sponsor is retiring Rep. Tom Petri (R-Wisc.), who mangled his Reagan history in a lame attempt to justify his actions as fiscally conservative.
Along with typical Americans, members of Congress and President Obama also oppose fuel tax increases. Proponents argue that the fuel tax has not been raised since 1993 and that inflation has eroded much of its buying power. This is true, but it also assumes the federal government has and will continue to be a positive force in surface transportation. It has not, is not, and will not be. Count me among the supporters of devolving federal responsibility to the states.
But short of full-blown devolution, Congress should aim for an attrition strategy I call de facto devolution. For this to work, Congress needs to do two things: 1) hold the line on Highway Trust Fund revenues and outlays, and 2) empower the states to experiment with a variety of user-based funding and financing tools. Recently, a number of states have raised their own fuel tax rates and have started examining superior alternatives such as all-electronic tolling and public-private partnerships. Both highway users and ideological free-marketeers should view this trend against road socialism in a positive light.
Unfortunately, federal law largely prohibits states from tolling their own Interstate Highway System segments. To its credit, the Obama administration proposed earlier this year to lift this ban. Congress will likely consider such a proposal next year as it attempts to craft a long-term surface transportation reauthorization bill. However, opposition from the powerful trucking industry, which also holds great sway at the U.S. Chamber of Commerce, will make advancing road pricing solutions to infrastructure investment and management problems a hard sell for many lawmakers.
Given public opposition to tax increases and trucking industry opposition to true user fees, the likely outcome is little to no positive change at the federal level. This means states will need to continue developing their own forward-looking funding and financing mechanisms, rather than assume a pot of formula-funding gold awaits them at the end of the highway bill rainbow.