SQ Proves the federal government wastes thousands of dollars per year on side projects and earmarks for non-transportation projects.
Utt 2012 (Ronald, is Herbert and Joyce Morgan Senior Research Fellow in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation. Utt is a veteran of budgetary politics in Washington, having served as director of the housing finance division at the Department of Housing and Urban Development, and senior economist at the Office of Management and Budget, Past director of economic research at the National Association of Real Estate Investment Trusts. Associate chief economist of the U.S. Chamber of Commerce, ““Turn Back” Transportation to the States” Feb 7th http://www.heritage.org/research/reports/2012/02/turn-back-transportation-to-the-states) AS
For the first several decades of the federal highway program’s existence, virtually all of its energy and resources were devoted to the task it was created to fulfill: building a 42,000-mile high-speed, limited-access interstate highway system from coast to coast and border to border, connecting all of the major cities in between. That task was largely completed by the early 1980s, and with no compelling and clear objective to guide the highway program in the aftermath of this accomplishment, successive Congresses began the process of diverting the trust fund’s resources to other purposes. While the diversions focused initially on non-road, transportation-related investments such as urban transit programs, non-transportation projects such as nature trails, museums, flower plantings, metropolitan planning organizations, bicycles, Appalachian regional development programs, parking lots, university research, thousands of earmarks, and historic renovation became eligible over time for financial support from the highway trust fund. As a consequence of this growing number of diversions, as much as 35 percent of federal fuel tax revenues paid by the motorists is spent on projects unrelated to general-purpose roads. The magnitude of these leakages also undermines assertions by many in Congress and the road-building industry that road conditions and congestion can be improved if fuel taxes are increased to allow for more highway spending. To the extent that the existing leakages maintain their share of total trust fund resources—as they traditionally do—a substantial portion of any increase in fuel tax revenues will be diverted to spending programs that offer little or no benefit to general motorists or to improvements in capacity, safety, or congestion mitigation. Under the allocations mandated by existing law, an additional dollar raised in tax revenues would provide only an extra 65 cents for roads because 35 percent would be siphoned off for other purposes.
Top down approach from the federal government results in inefficient spending and cost overruns
Utt 2003 (Ronald, is Herbert and Joyce Morgan Senior Research Fellow in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation. Utt is a veteran of budgetary politics in Washington, having served as director of the housing finance division at the Department of Housing and Urban Development, and senior economist at the Office of Management and Budget, Past director of economic research at the National Association of Real Estate Investment Trusts. Associate chief economist of the U.S. Chamber of Commerce, Proposal to Turn the Federal Highway Program Back to the States Would Relieve Traffic Congestion, November 21st The Heritage Foundation, http://www.heritage.org/research/reports/2003/11/proposal-to-turn-the-federal-highway-program-back-to-the-states-would-relieve-traffic-congestion AS)
With the completion of the interstate highway system more than 20 years ago and the increased urbanization of the population, America's transportation problems have become increasingly local and regional in nature. As a result, Washington officials have little to offer in the way of effective solutions to distant problems. Indeed, a case could be made that the existing top-down, one-size-fits-all approach embodied in the 1998 Transportation Equity Act for the 21st Century (TEA-21) has become a counterproductive waste of money that increasingly benefits influential constituencies at the expense of the ordinary motorists who fund the program through their taxes. Over the six-year period from 1998-2003, TEA-21 authorized the federal government to spend $217 billion on roads and transit,1 but very little of this money went for new road capacity. As a consequence of this misspending, traffic congestion has continued to worsen throughout the United States. According to annual calculations provided by the Texas Transportation Institute, the 75-city congestion index in-creased from 1.08 in 1996 to 1.17 in 2001, the percentage of freeway lane-miles that are congested during peak period rose from 43 percent in 1990 to 55 percent in 2001, and the percentage of daily travel in congestion rose from 30 percent in 1996 to 34 percent in 2001.2
Federal involvement creates inefficient policy- means only the CP Spurs economic growth
Edwards 2011 (Chris, Joint Economic Committee United States Congress “ Infrastructure projects to fix the economy? Don’t bank on it. ” October 21 http://www.washingtonpost.com/opinions/infrastructure-projects-to-fix-the-economy-dont-bank-on-it/2011/10/18/gIQAgtZi3L_print.html AS)
In the description of today's hearing, the committee asked how infrastructure helps to promote growth, jobs, and manufacturing. The short answer is that we can spur growth by ensuring that America's infrastructure investment is as efficient as possible. Infrastructure funding should be allocated to the highest-value projects, and those projects should be constructed and maintained in the most cost-effective manner. My testimony will discuss why reducing the federal role in infrastructure will help to increase the efficiency of our investment. The first thing to note about America's infrastructure is that most of it is not provided by the government, but by the private sector. A broad measure of private infrastructure spending — on items such as buildings, factories, freight rail, pipelines, and refineries — is much larger than government infrastructure spending on items such as roads and airports. In Figure 1, data from the Bureau of Economic Analysis show that private gross fixed investment was $1.7 trillion in 2010, which compared to gross fixed investment by federal, state, and local governments of $505 billion.1 When defense investment is excluded, government infrastructure spending was just $388 billion, or less than one-quarter of private infrastructure spending. One implication of this data is that if Congress wants to boost infrastructure spending, the first priority should be to make reforms to encourage private investment. Tax reforms, such as a corporate tax rate cut, would increase the net returns to a broad range of private infrastructure investments. Regulatory reforms to reduce barriers to investment are also needed, as illustrated by the delays in approving the $7 billion Keystone XL pipeline from Alberta to Texas. Despite its smaller magnitude, public-sector infrastructure spending is also very important to the U.S. economy. But the usual recommendation to simply spend more federal taxpayer money on infrastructure is misguided. For one thing, the government simply can't afford more spending given its massive ongoing deficits. More importantly, much of the infrastructure spending carried out by Washington would be more efficiently handled by devolving it to state and local governments and the private sector.
Allocation of federal funds means implementation at the state level fails
Roth 2010 (Gabriel, civil engineer and transportation economist. He is currently a research fellow at the Independent Institute. During his 20 years with the World Bank, he was involved with transportation projects on five continents, “Federal Highway Funding” June, http://www.downsizinggovernment.org/transportation/highway-funding/#5 AS)
Federal aid typically covers between 75 and 90 percent of the costs of federally supported highway projects. Because states spend only a small fraction of their own resources on these projects, state officials have less incentive to use funds efficiently and to fund only high-priority investments. Boston's Central Artery and Tunnel project (the "Big Dig"), for example, suffered from poor management and huge cost overruns.21 Federal taxpayers paid for more than half of the project's total costs, which soared from about $3 billion to about $15 billion.22 Federal politicians often direct funds to projects in their states that are low priorities for the nation as a whole. The Speaker of the House of Representatives in the 1980s, "Tip" O'Neill, represented a Boston district and led the push for federal funding of the Big Dig. More recently, Representative Don Young of Alaska led the drive to finance that state's infamous "Bridge to Nowhere," discussed below. The inefficient political allocation of federal dollars can be seen in the rise of "earmarking" in transportation bills. This practice involves members of Congress slipping in funding for particular projects requested by special interest groups in their districts. In 1982, the prohibition on earmarks in highway bills in effect since 1914 was broken by the funding of 10 earmarks costing $362 million. In 1987, President Ronald Reagan vetoed a highway bill partly because it contained 121 earmarks, and Congress overrode his veto.23 Since then, transportation earmarking has grown by leaps and bounds. The 1991 transportation authorization bill (ISTEA) had 538 highway earmarks, the 1998 bill (TEA-21) had 1,850 highway earmarks, and the 2005 bill (SAFETEA-LU) had 5,634 highway earmarks.24 The earmarked projects in the 2005 bill cost $22 billion, thus indicating that earmarks are consuming a substantial portion of federal highway funding. The problem with earmarks was driven home by an Alaska bridge project in 2005. Rep. Don Young of Alaska slipped a $223 million earmark into a spending bill for a bridge from Ketchikan—with a population of 8,900—to the Island of Gravina—with a population of 50. The project was dubbed the "Bridge to Nowhere" and created an uproar because it was clearly a low priority project that made no economic sense.
Share with your friends: |