We Care About Roads, Bridges, and Efficiency

Roads and bridges are important to consumers.  But the proposal to cover the Federal Highway Trust Fund (HTF) shortfall with savings from reduced postal deliveries leaves us gasping at its arrogance.  The proposal is typical of DC’s flawed “ideas.”  First, some “transportation” projects should not be federally funded.  In addition, the Department of Transportation’s (DoT) union straightjacket makes road and bridge construction inefficient.  Lastly, the proposed U.S. Postal Service (USPS) lifeline to DoT is an order of magnitude too small to cover the deficiency, and it may wreck USPS, an institution popular with consumers.   

There are always more Federal road & bridge transportation projects than HTF can cover.  Many are not pork.  Yet, $1.25 billion in federal transportation money (called TIGER funds) is spent on local projects such as a six-mile pedestrian mall in California and a “Complete Street Initiative” (non-auto-friendly) project in Florida.  There are transportation projects more relevant and less hostile to motor vehicles than those.  The Tiger project is one of those “shovel ready” ideas funded with stimulus money.  Once started, these cute ways to squander money multiply like rabbits.  Let local and state governments with their own excess money cover local embellishments.  Transfer Tiger’s $1.25 billion into the HTF.

The White House issued Executive Order 13502 “encouraging” Departments to use unionized labor for large projects.  Presumably it was the same kind of “encouraging” the IRS heard for political scrutiny by its 501(c)(4) crew.  DoT paid attention to the executive order.  This Administration-Construction Union cabal escalates the cost of federal construction contracts.   It’s sweet for the White House’s election campaigning, cushy for unionized construction workers, but bitter for taxpayers who get no benefits from the higher cost construction.  The union-built roads are neither longer nor better, but they cost about 9% more. 

There is no need to change the technical specifications of highway projects.  The DoT just needs to rollback its bias against non-union contractors.  Allow any competent construction contractor to bid.  That will sharpen competition and lower cost, whereas the union-only scam increases taxpayer’s costs.  Congressional members are glib enough to get union votes without having to bribe the workers.

In 2011, the highway trust fund revenues and interest received were about $37 billion.  Under sharpened competitive bidding, $37 billion in projects would cost $3.1 billion less per year.    Over 10 years, that would be triple the effect of the proposed lifeline from USPS.  Adding Tiger funds and competition efficiencies would make $4.3 billion per year in new funds available to HTF.  With those savings and removal of pork and local projects, the HTF’s deficiency might be reduced to near zero. 

If a small increase in fuel taxes is needed, so be it, but the arrogance of proposing a raid on USPS shows that DC lacks creativity and care in spending the taxpayer’s money.

Alan Daley Writes for the American Consumers Institute Center for Citizen Research

 

 

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