Transportation Woes

Recently, yet another committee issued yet another report on the subject of the Transportation Trust Fund. It bears comment.

First, the facts: the TTF is essentially broke. It went bankrupt by design. Although originally designed – wisely – as a "pay as you go" program, under which gasoline tax money would be employed to fund transportation construction and improvement, some rocket scientist figured out that if government borrowed against the tax receipts, it could spend loads more this year than the tax receipts themselves could support, thereby making contractors and union workers happy.

Of course, sooner rather than later, the interest payments on the bonds sold consumed the entirety of the TTF, producing a "crisis". Without new funds, transportation spending would cease. Horrors.

Then-Governor Whitman proposed a gas tax increase to fund the program anew. A small cadre of conservatives in the Assembly publicly and noisily rebelled. At that time, we proposed – in lieu of any tax increase -- that the balance of the gas tax (about 1 penny) then going into the general fund be dedicated to the TTF; that an another petroleum tax be similarly dedicated; and that all borrowing cease. For good measure, we proposed that some portion of the existing sales tax be dedicated to the TTF and that the sale tax itself be cut by a penny.

That would PERMANENTLY solve the problem but it suffered from one minor defect: it would require fiscal discipline. As with any proposal which insists upon responsibility, it died a lonely death.

Later, some of the political power brokers accepted some of the suggestions, such as dedicating the full gas tax and the petroleum products tax to the TTF. That provided a quick fix, but as we still used the fund to borrow, it simply postponed the day of reckoning.

Which has now arrived.

Demonstrating courage befitting a representative of the people, the Acting Governor simply postponed any discussion of the TTF – and a huge gas tax increase – until after the November election. Can’t have Democrats in the Assembly asked to vote on a major tax increase BEFORE they seek re-election, can we?

Given that transportation infrastructure cannot be ignored, and the fact that governmental irresponsibility bankrupted the TTF, it serves no particular purpose to bemoan lost opportunities for fiscal responsibility, except as an admonition against future folly. What solution should we pursue?

Government requires representatives not simply to claim to make difficult choices, but to actually make them. Given that funds are not unlimited, it behooves governmental officials to prioritize their spending. We can fix the TTF problem without increasing taxes, but it requires cuts elsewhere. Accepting the inevitable challenge to identify same, let me offer the following relatively easy targets:

• The Dept. of Education contends that many of the existing Abbott districts should be decertified, as they no longer require the same level of state aid. Do it. The estimated savings: $400 million. Use that money for the TTF.
• Cut aid to Newark by the cost of the arena they intend to build with public funds: savings, $200 million, plus. Use that money for the TTF;

While $600 million ought to be more than sufficient for next year’s transportation projects, there are many more relatively easy targets:

• The legislature just voted to spend between $35 and $70 million on "near Abbott" districts (interestingly represented exclusively be Democrats). Repeal that gift; use the money for the TTF.
• Immediately after the budget was adopted, an additional $37 million was doled out in aid to Camden, on top of the hundred million plus already doled out. Repeal that grant; use the money for the TTF.
• The Governor proposes $150 million plus for a new stem cell institute. Even were the idea a good one, if the choice is between deteriorating bridges, decrepit trains, and impassable highways, and such an institute, attending to these existing obligations should come first.
• The budget contained some $200 million or so in special pork projects, mostly in Democratic districts. However wonderful these programs might be, one must choose between those discretionary items and the necessity of transportation spending.

Oh, and ABSOLUTELY PROHIBIT any new borrowing.

The point being that we have more than sufficient revenues flowing into government. The Democrats increased taxes – on top of the already obscene baseline from a scant four years ago – by $2000 per family. The Trenton Democrats borrowed and taxed at astonishing levels, bloating spending by 20% in two short years. We don’t need higher taxes on anything; we need to be more careful about where we spend the money.