Editorial: Renewing overdue bids would refuel economy
An overdue bid to replenish the federal Highway Trust Fund could be the vehicle for renewal of the Export-Import Bank charter.
Refueling both would boost the economy.
Absent congressional action, the trust fund, which finances the maintenance of crumbling highways and bridges, runs out of money July 31. The House, which passed a two-month stopgap bill, begins its traditional August recess next Friday. So that’s the deadline for the Senate, which adjourns a week later, to find a long-term solution.
The problem, as always, is the political freak-out over financing. The federal government spends $50 billion a year on repairs, but collects only $34 billion from vehicle-related sources. Congress has long been aware of this deficit, but many members are afraid to raise a federal gas tax fixed at 18.4 cents per gallon since 1993.
Inflation and improved fuel efficiency have eroded those revenues, just as they have for the states.
But rotting roads and bridges exact a toll, too. Fallen bridges, like the Interstate 5 structure dumped into the Skagit River last year and the Interstate 10 span washed out last week, throttle the economy. Poor infrastructure costs U.S. motorists time – an average 38 hours a year in traffic jams, and money – $324 a year for repairs.
About one-fourth of bridges need replacing, according to the U.S. Department of Transportation, and two-thirds of U.S. roads are in subpar condition.
One logical step would be to increase the gas tax and index it to inflation, but logic and politics seldom travel together. So the Senate bill would shift $47 billion from the general fund (those who believe roads pay for themselves, take note) and offset the transfer by selling some oil reserves, extending user fees, and slashing dividends the Federal Reserve pays to banks,.
That’s better than the temporary patch supplied by the House, and it appears to be the only long-term solution that stands a chance of passing.
Ex-Im Bank renewal is along for the ride because Senate Majority Leader Mitch McConnell promised Sens. Maria Cantwell and Patty Murray that he would revisit the issue as an amendment to “must-pass” legislation, i.e., the highway bill. The Ex-Im Bank’s charter expired in June without a vote, so Washington’s senators are on firm ground in demanding one. McConnell says there are enough votes for passage.
Unlike the Highway Trust Fund, the Ex-Im Bank does not run a deficit. In fact, it returns a surplus to the Treasury after helping businesses consummate deals with foreign entities that wouldn’t happen otherwise. We’ve made the case many times that the unique guarantees the bank offers are a boon to trade, and no state benefits more than Washington.
The twin renewals of the nation’s infrastructure and a key export tool are urgently needed. Congress shouldn’t take a vacation until this important work is done.