Speaking of the Highway Trust Fund — talk of federal gasoline taxes reminded me that very early in the Bush Administration there was a big push to keep HTF money from being spent on mass transit.
Very basically, the gas taxes are collected by the federal government, which takes its cut and then allocates the remainder as the federal government sees fit. According to the Department of Transportation, “Of the 18.3 cents collected per gallon of gas, 12 cents goes into the highway account, 2 cents goes into the mass transit account, and 4.3 cents is credited to the general fund of the Treasury.”
So back in July 2001 some guy from the Heritage Foundation, naturally, complained that “our roads” were suffering because of the 2 cents that went to mass transit. “Our roads” need that 2 cents. And most of the mass transit money went to a handful of “rich” (read “blue”) states, anyway!
In the case of Virginia, as well as 24 other mostly Southern states, the amount of money returned is less than the taxes paid, while the other 26 states, mostly in the North, get more back than they pay. … today as much as 18 percent of trust-fund revenues paid by motorists are reserved for transit programs that benefit only a tiny fraction of commuters–currently about 5 percent.
Moreover, federal transit spending suffers from regional imbalances that are worse than those for highway spending. In 1999, more than 50 percent of federal transit spending went to just five states–California, Illinois, New Jersey, New York, and Texas.
I never realized that California and Texas were in the north, but never mind. I remember that some Republican politicians proposed sending all the money collected in federal gas taxes within a state back to that state, minus the federal share. That way, poor and hard-driving red states wouldn’t end up subsidizing rich mass transit-riding blue states. I recall some guy — I think it was a Texas congressman, but I can’t find a link — making speeches about the evils of subsidized (read “socialist”) urban mass transit versus good ol’ all American payin’-for-themselves highways stretching across the heartland.
One problem with that idea is that overall the federal taxes collected in blue states subsidize more programs in red states than the other way around. Paul Krugman wrote in May 2002,
As a group, red states pay considerably less in taxes than the federal government spends within their borders; blue states pay considerably more. Over all, blue America subsidizes red America to the tune of $90 billion or so each year.
And within the red states, it’s the metropolitan areas that pay the taxes, while the rural regions get the subsidies. When you do the numbers for red states without major cities, you find that they look like Montana, which in 1999 received $1.75 in federal spending for every dollar it paid in federal taxes. The numbers for my home state of New Jersey were almost the opposite. Add in the hidden subsidies, like below-cost provision of water for irrigation, nearly free use of federal land for grazing and so on, and it becomes clear that in economic terms America’s rural heartland is our version of southern Italy: a region whose inhabitants are largely supported by aid from their more productive compatriots.
I dimly remember Senator Schumer suggesting that maybe the “blue” states should get back all their taxes, too, and how would you like them apples?
And it’s not like mass transit consumers are getting a free ride. If you commute into Manhattan on the Metro North Railroad, for example, you pay between $123 and $357 a month, depending on where you live along the line. Long Island Railroad riders pay between $130 and $342 a month. But unless you get a subsidized parking place as a job perk (rare), it’s cheaper than driving. If you live in the city and take a subway to work, a 30-day unlimited ride Metrocard will cost you $78. For people in low-wage jobs that’s a lot. Yet the expense of operating these transit systems is higher than revenue. Subsidy is required.
Most of the nation’s wealth is generated in our cities, and most big cities couldn’t exist without some kind of mass transit system. It may be hard for a taxpayer in rural Nebraska to grasp that his life is better because of the Long Island Railroad, but it is. And now that the Age of Cheap Gasoline seems to be coming to an end, seems to me a lot of people who turned up their noses at mass transit in the past might want to change their attitudes.
Back where I grew up in the Ozarks, every weekday morning a great many cars carrying one passenger each head northeast highway 67 and then take highway 55 north into St. Louis, where the one passenger has a job. The drive takes an hour, give or take, assuming no bottlenecks form. And then, of course, in the evening they come back. This happens around every city in America. Now, I grew up in the Midwest and I realize everything is spread out there, and you need to drive to get anywhere you want to go. Manhattan may be the only place in America where people can function very happily without ever driving a car.
However, seems to me the day will come when fewer and fewer people will be able to afford to drive two hours a day between work and home. But how long will it take for conservatives to figure out that putting all of our tax dollars into highways while starving mass transit is, um, shortsighted?