they want higher taxes for roads -- subsidies
for an inefficient transportation system that has
become too expensive to support.
we go again!
number of members of the Virginia General Assembly
have suggested yet another special session to
consider a tax increase, this time for
transportation. Here is further evidence that
the only sure result of a tax increase is pressure
for even more tax increases.
has been much hand-wringing by Gov. Mark R. Warner
and pro-tax legislators over the status of
Virginiaís credit rating. After decades of having
the highest rating, Virginia shouldnít risk losing
it, these officials insist, if only because it is an
important psychological barrier.
AAA credit rating is not the only psychological
barrier to be concerned about. The traditional
legislative inhibition to raise taxes in response to
constant demands for more funding is another,
perhaps more important one. As a matter of fact, it
is difficult to maintain the highest credit rating
without a strong inhibition against raising taxes.
the taxing option is easily availed, fiscal
discipline withers. Instead of rigorously examining
ways to avoid raising taxes, such as cutting waste,
elected officials become more and more inclined to
choose a tax increase as their first response.
Thatís what happened in California.
seems that key legislators already have their minds
made up about raising taxes to fund transportation
projects. The only questions are which tax and how
much to increase it.
approach is foolish on many levels. Letís consider
way Virginia has developed since World War II has as
much to do with governmental decisions about
infrastructure as with any other factor. We were
slow to understand the costs involved.
recounting the lessons learned, we should be
especially troubled by any policy that leaves us so
dependent on a resource over which the United States
has so little control. Blindly continuing the
pattern of road construction we have followed for a
half century involves a gamble that we will have a
steady supply of oil at relatively low cost for the
foreseeable future. Based on what is happening in
Saudi Arabia, Georgia, Venezuela, Iraq and other
major producing countries, that bet may need to be
result of our decades-old transportation policy is
an inefficient system that we can no longer afford
to support. The only way to make that system more
efficient is to let market forces and private
investment play a larger role.
look at a specific problem to illustrate how this
would work. Transportation in Virginiaís major
urban areas has become more congested year after
year. We canít build infrastructure fast enough to
keep up even if we had enough funding.
we increase tax support for road building, we make
transit less viable, which leads to demands for even
higher transit subsidies. Taxpayers shouldnít
subsidize either mode, not because itís unfair,
but because those subsidies are causing market
distortions and gross inefficiencies.
need to make various modes compete within urban
areas. We should also encourage greater private
investment and market-oriented solutions, and less
of the old way of financing transportation.
a day when gasoline futures set an all-time high,
Maryland transportation officials by coincidence
were considering building a network of toll lanes to
reduce congestion. Virginia has been considering
this course for years. Thatís encouraging.
should be exploring fundamental change in
transportation policy instead of raising taxes to
fund the same old approach.
May 10, 2004