Ed Wallace

Over and over again

By Ed Wallace

To this day I have no idea why I was personally invited to a small Star Chamber meeting of powerful Republicans. It’s true that my radio show is sponsored by friends in the automotive industry, the vast majority of whom are card-carrying, money-donating, God-fearing Republicans — and wonderful individuals who deeply care about our great state and have a strong sense of social justice. At least the ones I know. Yet, while I admire all of them, I’m not one to ask to participate in the sausage-making aspect of moving our political system along. I care about only the issues that affect those who either listen to my work or read this column. I have no interest in how people come to be elected, just that they do the right thing once in office.

Yet I was invited on that day. I wrote about certain aspects of that meeting in this column years ago; I’ll add a few more facts today.

The reason for the meeting was to meet with Lt. Governor David Dewhurst, while the group discussion was that Rick Perry was going to run for the presidency; going by the comments of some of those in attendance, that would be a good thing for our state. The move that day was to put David Dewhurst up for governor, while it was also suggested that Greg Abbott, then our attorney general, should become Lt. Governor. For the record, all the visions laid out that day went off the rails when Kay Bailey Hutchison announced she would leave the Senate; Mr. Dewhurst thought he’d like that position more than being governor. In a nutshell, that’s how we ended up with Ted Cruz.

As David Dewhurst spoke that day to this group of Republicans looking to create the next generation of our government for our state, I wasn’t just impressed with what he had to say; I also realized that he was probably as fine an elected official as this state has ever produced. It’s what he said that day that I wrote about before, and it still holds true today. The vision he laid out for Texas was powerful — first by stating the obvious, and that was how much Texas had grown, both in population and in the size of our economy.

But there were also hard issues we had to start working on immediately, Dewhurst pointed out, in order to avoid a costly train wreck within the decade. As he put it, our growth had already overtaxed our highways, our lake and reservoir water systems, and our electric grid. We needed to start fixing and expanding critical infrastructure such as that now, because if we as a state put it off it would only get more costly as time passed; and then we’d be playing a very expensive game of perpetual catch-up for decades to come. The way he put it still rings in my ear today: “If we don’t do this now, in a decade we will become California.”

I did write that looking around that room on that day, one could see all of the participants’ eyes brighten; their chests swelled with pride, and they radiated an aura of excitement at being in the vanguard of taking Texas to the next level and making it the envy of the United States. However, I also noted that making this happen would require new taxes and other fiscal realities, and that point was not discussed that day at all. But on that day — for that brief, fleeting moment — I once again felt faith in our political system.

I did mention that in the primary, Texans rejected Dewhurst and gave us Ted Cruz instead. And last week Senator Cruz gave us the exact opposite view of Dewhurst’s vision for Texas.

They Always Name Laws Backwards

When he was a boy, Lyndon Baines Johnson’s family didn’t have the $5 to pay the road tax, and families in that situation had to send their kids to work on county road crews instead. LBJ wound up grading dirt country roads with a mule team, and this bill should remind all of us of those days.

According to the Fiscal Times, the legislation Cruz, Mike Lee and Marco Rubio put up is titled The Transportation Empowerment Act, which is the exact opposite of what it would do. Here’s what’s in it.

Starting in 2021 and ending in 2025 the federal gasoline tax, which at just 18.4 cents per gallon is exactly what it was a generation ago, would be reduced to a mere 3.7 cents and primarily be used for upkeep of the Interstate Highway System. From 2025 on, states and states alone would be responsible for all other highway construction, repairs, maintenance, and so on within their borders. In case you didn’t get it, this is a setup for complete and total failure of our state’s infrastructure system. Here’s why.

First, one can almost understand why Senator Lee, of Utah, might, and I stress the word might, think there was some logic to this one. After all, his is the 12th largest state in square miles, but has only 97,488 miles of roads and highways, according to the Federal Highway Commission’s 2014 report. That’s 1.18 miles of highway for every square mile of land mass. Marco Rubio’s home state of Florida has 5.02 miles of highway for every square mile. Texas has 2.58 miles of roads and highways for every square mile. So the far fewer roads and highways in Utah might be manageable under this scheme, but Florida’s situation is nearly five times worse. And with almost twice the square mileage of Utah and Florida put together, Texas has more miles of roads than any other state in America. -By a lot shot.

Of course, there are other ways of looking at this, such as the miles of roads compared to population, wealth or GDP of each state. But there’s really only one way to look at this Senate bill, and that’s the hard fact that states such as ours have steadfastly refused to raise gasoline taxes for the past 25 years. Instead we were set up so that our only real option was to create toll roads everywhere. First you intentionally starve the beast, then claim you have no money, (because you starved the beast) and so the only solution is more toll roads.

Let’s put the Texas situation in real perspective. We have 675,580 miles of roads. Compare that to California, which has just 394,608 miles of road. So each and every Texan would cover the cost of .0234 mile of road. But in California each citizen has to cover only .00992 mile of road. Utah is .0308 mile per citizen and Florida .0127. That would give you some idea of the state cost per person for highways. But when that metric is used, Texas and Utah come up on the shorter end of things.

Here’s the fiscal reality. Florida’s gasoline tax is 36.59 cents per gallon and they just raised it again slightly. California’s gas tax works out to 47.3 cents per gallon, but there’s a movement to roll that back in November. Utah increased its gasoline tax back in 2015 and now drivers pay 29 cents per gallon for highways. Meanwhile, our gasoline tax in Texas is the same 20 cents per gallon it was when I was still in my late thirties a generation ago. And every time someone mentions fixing this at our legislature it’s always no higher taxes, no time, no way.

So why would Senator Ted Cruz throw this support behind a bill that would require us, a state with one of the lowest gasoline taxes in America, to maintain the highest number of miles of roads and highways in the nation on our own — knowing full well that we also have refused to deal with this problem by raising the gasoline tax for the past 30 years, even though it’s been badly needed?

It’s a setup for Texas. And the end result will be more privatization of our highways. This bill is, no matter whether they vote or not, selling out every last driver in our state.

Wall Street Buys Main Street

Here we have to remind everyone that every time a toll road is completed we are treated to columns and columns about how happy everyone is, how cheap the tolls are, and so on. But give it a year or two and people start seeing what appalling amounts toll roads are really costing them, not to mention they quickly become congested too. Then the next thing you know you have a revolt on your hands when the public says, enough is enough. Or did everyone forget that only last year our legislature had to deal with the public’s anger over just this issue? Things got so testy that 25 of our State Senate’s 31 members added their names to a measure that would put a moratorium on new toll road construction.

Apparently that bipartisan voter message, which was loud, clear and unmistakable in our state, was completely ignored in the U.S. Senate’s Washington offices. The entire concept of government is to govern; in America, the government is supposed to “promote the general welfare” and look out for our best interests. But, as yields fall for large investments, we long ago entered a period in which Wall Street looks for any investment that pays off long term by taking ownership of things we cannot get out of using each and every day.

Electricity was one such thing. It used to be a regulated monopoly that worked and worked well. When the Star-Telegram quoted Enron’s Jeffrey Skilling in the mid-Nineties on why we needed to deregulate what was already working well — giving us one of the nation’s lowest costs for electricity — he made fun of the 6.04 cents per kilowatt hour we were forced to pay because there was no competition in the market. So we deregulated, and for nearly a decade we all paid a huge price for that mistake. People still call my radio show, still email me asking how to choose a service provider on powertochoose.org because they’ve gotten burned so many times in the past.

We can’t get out of driving, either. But now, instead of jointly building and publicly owned roads to go to work or go shopping, we sell them and become renters forever. And the Internet is full of stories of bankruptcies of privatized highways, people on moderate incomes getting beat up over these slot machines for automobiles. And now Cruz, Lee, and Rubio want to take a situation that no American citizen wants and put that program on steroids to take even more of our money and sell off more highways and future roads.

Only they don’t say that. They say the exact opposite, that by getting rid of the federal highway tax and leaving road maintenance and building to the states it would be handled better and be more fiscally responsible.

Tell that to the people of Louisiana, who still cross bridges with “Huey P. Long Built This” signs on them. Or the people of Mississippi, who just a couple of months ago had yet another 100 bridges shuttered on short notice because they were unsafe, bringing that state’s total number of closed bridges to 542 as of this past April.

Cruz, Lee, and Rubio promise more for less, exactly as Enron promised us for electricity. (Or Phil Gramm promised us by deregulating the futures market and ending Glass Steagall) Every time we are told that we end up getting much less for a lot more the exact opposite happens. The only real question here is why we keep forgetting that reality. But, if you’re reading this, you’ve been reminded … and warned.

Ed Wallace is a recipient of the Gerald R. Loeb Award for business journalism, bestowed by the Anderson School of Business at UCLA, and hosts the top-rated talk show, Wheels, 8:00 to 1:00 Saturdays on 570 KLIF AM. Email: edwallace570@gmail.com