President Obama
continues to push Congress to take action on highway funding, with time running out before funding is projected to lapse. That lapse, as the Highway Trust Fund is drained, is projected for August, and would endanger construction projects. The president and Transportation Secretary Anthony Foxx will highlight the issue again this week, and:
In an effort to put more pressure on Congress, the White House on Monday will publish "an interactive transportation map" that it says will allow Americans to see the conditions of roads and bridges in their area. It also will ask citizens to submit photos and descriptions of local roads, bridges, and traffic problems to a White House database.
Congress has an answer, but it's
temporary and bad:
The latest proposal, which passed the Republican-controlled House Ways and Means Committee on Thursday, works like this: If you change corporate pension funding rules to let companies set aside less money today to pay for future benefits, they will report higher taxable profits. And if they have higher taxable profits, they will pay more in taxes over the 10-year budget window that Congress uses to write laws. Those added taxes can be diverted to the Federal Highway Trust Fund.
Unfortunately, this gimmick will also result in corporations paying less in taxes in later years, when they have to make up for the pension payments they’re missing now. But if it happens more than 10 years in the future, it doesn’t count in Congress’s method for calculating budget balance. “Fiscal responsibility,” as popularly defined in Washington, ignores anything that happens after 2024.
If this sounds familiar, it's because pension underfunding is a popular strategy in Congress for finding "free" money, and has already been used in 2012 for highway funding. Because raising the gas tax is really unpopular so neither party is eager to do it and, as usual, Republicans are willing to destroy the country to protect businesses from higher taxes and Democrats are willing to compromise to avert immediate disaster, even if the compromises set the stage for bigger problems down the road. And so it will likely be this time, with Obama prepared to sign onto the pension strategy to prevent highway construction from grinding to a halt in August, even though we'll then face the issue again next year. But in the mean time, the president continues to try to focus attention on the issue, pressuring Congress to do something,
anything about highway funding.