Is trim the federal transportation bureaucracy and leave much of the road work to the states and local governments.
Most people do not realize that out of every dollar of federal gas tax collected specifically for maintaining road infrastructure about 20 cents makes it into hard projects. The rest is soaked up by the bureaucracy.
At the town level the ratio is flipped with less than 10 % of funds going to the bureaucracy. The bottom line is less taxes paid has a bigger real impact on the roads you drive. Better roads and more money in your pocket. Why are people opposed to that concept?
One local grant to pave a street in my town was a sick joke to read. Basically the town applied for and received a $1 million grant. Nearly $800,000 of the grant went to pay administrative costs at the state and federal levels to manage the program. Federal fuel taxes alone paid by the residents exceeds $1 million a year. So where is the money?
The bureaucrats are smart. On paper they make Congress think that millions are being handed out with minimal administrative costs. The charge backs and administrative cost withholdings drive down the value of the actual grants given while hiding the true bureaucratic costs in a mountain of red tape and paper work.
The public sector is not the only place you find this scam. A major national charity donated $10,000 to a group I was working with. The big string attached was that $6,000 of it HAD to be spent sending 2 attendees to their annual national rally. We even had to use their travel agency. Thee group thought it was getting $10,000, but only got $4,000 they could use.
Yet it is legal for the charity to report a $10,000 donation in their tax filings.
Okay, maybe the United States doesn’t need a trillion dollar coin to pay for infrastructure immediately, but one group says that investments in the trillion dollar range will be needed in the coming years or else the nation’s poor infrastructure will be a drag on the economy.
A new report from the American Society of Civil Engineers (ASCE) — the same organization that graded U.S. infrastructure as a D — says that between now and 2020 the U.S. will need to spend over $1 trillion more than what’s already planned to be spent on infrastructure. If not, the organization argues, the U.S. will lose out on economic gains, including:
- $3.1 trillion in gross national product;
- $1.1 trillion in trade;
- $2.4 trillion in consumer spending;
- $3,100 annual drop in personal disposable income; and
- 3.1 million jobs.
In the organization’s report — produced by the Economic Development Research Group — the U.S. will need to spend $157 billion more per year reap the economic benefits. Specifically, the report says there’s an investment gap of $39 billion in airports, $16 billion in seaports and waterways, $846 billion in surface transportation, $107 billion in electricity, and $84 billion in drinking water and wastewater.
“[D]eteriorating infrastructure has a cascading impact on the nation’s economy, negatively effecting business productivity, gross domestic product, employment, personal income, and international competitiveness,” said ASCE’s president, Gregory E. DiLoreto. “The message is clear: if we do not invest now, all Americans end up paying more in the long run.”
Photo: Flickr/woodsboard
[h/t Governing]
