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Executive Summary #2370 on Transportation Spending

December 10, 2009

Executive Summary: Chairman Oberstar's Transportation Plan: A Costly Exercise in Social Engineering

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In June 2009, Representative James Oberstar (D-MN), chairman of the House Committee on Transportation and Infrastructure, introduced the Surface Transportation Authorization Act (STAA), a 775-page bill to reauthorize federal highway and transit programs for another six years. However, STAA would also dramatically change federal transportation policy by:

  • Shifting resources from cars to trolleys and buses;
  • Requiring a huge tax increase to fund these new commitments;
  • Centralizing transportation decisions in Washington;
  • Requiring a substantial increase in the numbers of state, local, and federal government employees; and
  • Discouraging the private sector from investing in surface transportation projects.

As if this were not enough of an intrusion into Americans' lives, many of the harmful transportation and land-use proposals in STAA are also in the Senate's cap-and-trade bill (S. 1733) and Livable Communities Act of 2009 (S. 1619).

The Surface Transportation Bill. As written, the chief purpose of many provisions of STAA is to deter the use of automobiles and force residential and commercial development into higher-density urban communities where public transit, walking, and bicycling would be the primary forms of transportation. To accomplish this, Mr. Oberstar's bill would encourage and require states and metropolitan planning organizations to use new land-use regulations that would lead to much higher population densities than Americans now prefer.

To fund these new commitments and lifestyle changes, STAA would require an additional $150 billion to $200 billion in taxes over the next six years. Such an increase would be equivalent to a 112 percent increase in the federal fuel tax. In addition, STAA would require an unspecified increase in other federal taxes to fund a new $50 billion higher-speed rail scheme.

A major thrust of these bills is reducing greenhouse gas emissions, reinforced by the mistaken belief that -- despite all of the evidence to the contrary -- this can be accomplished by rearranging existing living and travel patterns. Given the evidence on fuel efficiency and greenhouse gas emissions from the different modes of travel, neither STAA, S. 1733, nor S. 1619 would significantly help the nation or the environment. Instead, in the process of failing, all would impose great costs and inconveniences on American citizens and businesses. For this reason, these bills should be withdrawn from consideration or substantially modified so that they would actually benefit the nation.

The Obama Administration and the Senate have proposed delaying passage of this bill for 18 months, but the requested delay has more to do with legislative congestion and the Administration's delays in developing its own "livability" program than any dissatisfaction with the draft bill. Indeed, Oberstar's intention to use the federal government to engineer change in American lifestyles is consistent with goals embraced by U.S. Secretary of Transportation Ray LaHood. In recent months, Mr. LaHood has announced his intention to "coerce" Americans out of their cars and has defined "livability" as "being able to take your kids to school, go to work, see a doctor, drop by the grocery or post office, go out to dinner and a movie, and play with your kids in the park, all withouthaving to get into your car."

A Lesson from Britain. In enacting this or similar legislation, the U.S. would be following the sorry land-use and development policies that the United Kingdom embraced in 1947 by enacting the Town and Country Planning Act. Designed to preserve the rustic nature and charm of Britain's countryside, the act empowered the national government to use laws and regulations to concentrate most housing and commercial development in existing urban centers. As a result, the United Kingdom today has the smallest and most expensivehomes of any advanced country. So severe is the problem that British politicians are now promising to change the policy and create incentives to build more and better housing.

Conclusion. In the past several highway reauthorization bills, Congress has demonstrated more interest in spending money on influential constituencies than in relieving congestion and promoting cost-effective mobility. STAA combines this predilection to spend with the goal of substantially altering lifestyles through regulations, subsidies, and penalties to crowd development, create higher population densities, and compel people to use public transit. As STAA now stands, rather than spend the next six months negotiating the terms of their surrender, fiscal conservatives might better devote their energy to ending the federal highway program and turning it and the associated federal fuel tax revenues back to the states.

In the meantime, fiscal conservatives and proponents of an improved transportation program should support the President's request for an 18-month extension, both because the delay would give them opportunities to expose the massive flaws in STAA and because the 2010 elections might produce a more responsible Congress that would write a better bill.

Ronald D. Utt, Ph.D., is Herbert and Joyce Morgan Senior Research Fellow in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation.

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