A Simple Plan

Posted Friday, May. 09, 2014  comments  Print Reprints

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We are one confused nation when it comes to transportation and the infrastructure necessary to do business in America. As a perfect example, let’s look at our national energy policy.

More than 20 years ago, Congress decided that adding oxygenates to our gasoline would lower the harmful emissions cars put into the atmosphere. But carburetors were already being phased out; and new fuel injection systems, combined with newly computerized engines, set the fuel-air ratio perfectly. We didn’t need any oxygenate to achieve the new clean air standards.

That didn’t matter. We got a gas additive, anyway: MTBE, which immediately caused billions of dollars’ worth of damages to local and municipal water supplies nationwide. Not to worry; the Clinton Administration reinterpreted that Clean Air Act of 1990 provision to mean that, instead of using MTBE, we would oxygenate our fuels with renewable, corn-based ethanol.

But even before our energy companies were willing to ditch MTBE and its heavy legal liabilities, our scientists proved that ethanol actually increases smog problems. So our elected officials came up with a “new and improved” justification for corn-based ethanol: It would make us energy independent from foreign oil. Only that wasn’t true either.

Why? Because starting in 2005, just as the new mandates for more ethanol in the nation’s gasoline supplies started kicking in, we all started using less gas anyway, because its prices were soaring. So we were self-regulating at that point. Then both the Bush and Obama administrations set new national fuel economy standards — which is actually the far smarter way to lower our gasoline demands, long term — but the automotive market had already seen consumers shifting to more fuel-efficient vehicles.

Policy: “Waste Taxpayer Dollars?”

Somewhere along the way we’ve wasted billions and billions of dollars on MTBE, including contingent liabilities for having used such a toxin to begin with. Meanwhile, today the corn-based ethanol industry is turning around $30 billion per year, according to Forbes magazine.

But in reality, modern automotive technology and a slightly more frugal motoring public have not only lowered vehicle emissions and raised fuel economy, but also have led to less gasoline usage per motorist. Yet we still waste far more gasoline than one might think.

Really. Don’t you think it’s ironic that the federal government has raised the fuel efficiency standards twice in the past decade, to mitigate our oil and gasoline use, while states have raised our speed limits, which dramatically lowers any vehicle’s fuel economy? Case in point, on a number of Texas roads the posted speed limit is 85 mph, which lowers the fuel efficiency of any vehicle by at least 35 percent. Utah, Wyoming and Idaho have 80 mph speed limits, Nevada and Maine have 75 mph limits, and most of the Interstate system is at 70 mph today. And we’re all routinely driving 10 – 20 mph faster than those posted speed limits.

So the feds force better mileage on automakers, and we all do our part to nullify that improved fuel economy with the way we drive. And that’s our national energy policy?

Big Brother’s Highway Foundation

Another prime example of cognitive dissonance is the issue of highway construction. The political cry over the past 15 years is that we don’t have the money to maintain our highway system, much less to enlarge it to what’s needed for our economic recovery and success. Yet they tell us that our Gross Domestic Product has never been higher. It’s so confusing: Are we wealthier than we’ve ever been, which is what the hard data shows, or completely broke when it comes to the infrastructure we so badly need?

Not to worry, there’s a solution to this imaginary financial problem.

True, more toll roads and HOT Lanes, which let you buy your way out of traffic congestion if you can afford to, are showing up all over America. But what’s coming is a plan to start charging everyone for each mile they drive.

North Carolina is one state suggesting that future, but 10 other states are also looking at such a plan. As things stand now, North Carolina’s highway budget has a $465 million annual shortfall. Yet Nick Tennyson, the state’s deputy secretary of DOT, told the Charlotte News & Observer on March 31, “There’s not a lot of political appetite for changing a [gas] tax rate that people are reminded every time they fill up, what they’re paying.”

Really, Nick? You think motorists aren’t concerned about retail gasoline prices’ fluctuating wildly every other month — but paying a few cents more per gallon for better roads would drive them nuts?

So, one suggested plan is to install GPS transponders that measure each and every mile you drive and then bill you a half penny a mile highway tax. Did anyone stop to think what it will cost the public, not to mention business and industry fleets, to buy GPS transponders for each car they own?

Further, how do you collect the fees from drivers who don’t have credit cards, so they can’t be billed automatically? What bureaucracy will they have to create and fund to handle the computerized information, satellite connections, billing or collections? And is it fair to charge someone who has a lightweight, fuel-efficient Prius the same rate per mile as someone driving a Ram one-ton dually truck, pulling a fifth-wheel trailer with a 15,000-lb. load? Because that’s what a GPS system charging motorists per mile would do.

Gets better. Because the GPS tracks you wherever you go, as the News & Observer pointed out, if you drive only in the city, that municipality could demand more of the highway funds for its streets alone. Likewise, if you drive out of state, say to Virginia, that state could demand that North Carolina hand over part of the funds for the time North Carolina’s drivers used Old Dominion roads.

By the way, this costly and complicated system of funding roads would not replace the planned HOT lanes or toll roads in the state.

Now, what happens if someone’s GPS system breaks — or the owner pulls the fuse that supplies its power? What harm will it do to our poorest citizens, who can’t afford to add GPS to their 30-year-old Chevy trucks?

No New Bureaucracy Needed!

North Carolina does have a $465 million annual shortfall in highway funds, but here’s a couple of alternative ideas.

First, quit transferring $265 million a year out of the state’s collected gasoline tax revenues into the General Fund. Immediately, you’ve solved more than half of the highway funding “shortfall.”

Failing that, notice that North Carolinians purchase 5.6 billion gallons of gasoline each year. This means that, instead of mandating expensive GPS tracking and the bureaucracy needed to run it, bill it and collect it, and instead of dealing with fights over who gets how much of that money — not to mention the patent unfairness of charging all motorists the same rate, no matter how much or how little damage their vehicle does to the road — they have only to raise the gasoline tax by 8.5 cents per gallon to be good to go. That’s higher than the 1/10th of a penny North Carolina raised gasoline taxes last year, but it solves their problem.

Oh, and that tax collection system is already in place and working fine.

Someone who traded in his old 25-mpg car for a new one that delivers 40 mpg doesn’t really care about paying 8.5 cents a gallon more for gas, if it buys him or her out of congestion by improving the state’s roads. What that person will care about, guaranteed, are a massive new Rube Goldberg surveillance system and consequent new bureaucracy, along with paying huge costs to install an unnecessary system that delivers the same effect as a simple increase in the gasoline tax.

© Ed Wallace 2014

Ed Wallace is a recipient of the Gerald R. Loeb Award for business journalism. He hosts Wheels, 8:00 to 1:00 Saturdays on 570 KLIF AM. E-mail: wheels570@sbcglobal.net; read all of Ed’s work at www.insideautomotive.com

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