May 14, 2005

I DESERVE IT, YOU PARASITE:

A Tale of Two Trust Funds (JOHN TIERNEY, 5/14/05, NY Times)

The trust fund was set up with the simple idea of making drivers pay for their roads by taxing the gasoline they bought. It worked at first, giving drivers wide-open Interstate highways, but eventually new drivers clogged the lanes, and the trust fund didn't yield enough money to build new roads or even maintain the existing ones.

The highway money dwindled partly because Congress didn't raise gas taxes to compensate for inflation and the higher fuel efficiency of cars, and partly because the trust fund kept getting raided. Gas taxes have been diverted to museums, a symphony hall, a riverside promenade, downtown landscaping projects, snowmobile trails and suburban transit systems that haven't been much more effective than horse trails in reducing road congestion.

As urban traffic got worse and roads deteriorated, highway planners kept hoping that drivers' anger would force Congress to raise gas taxes and reduce pork, but the planners eventually accepted political reality. They gave up on the trust fund to build new roads and turned to another source of money: tolls collected directly from drivers.

You might keep this history in mind during the debate about another trust fund's problem, the $11 trillion long-term deficit facing Social Security. Democrats are counting on the program's popularity to force Congress to raise taxes to preserve it, but if politicians were too afraid of voters' wrath to add a few pennies to the gasoline tax, should you count on them to vote for far more painful increases?

If they don't, the only way to preserve the promised benefits is to cut federal spending, a notion that seems quaintly utopian when you look at how hard Congress has fought the White House's attempts - futile, so far - to keep the highway bill within the budget. The highway cuts demanded by the administration are chump change compared with what will be needed to pay for the baby boomers' retirement.


Which is why it's always amusing to hear the same middle class white males who bitch the most about entitlement programs turn around and insist that taxing them enough to pay the costs of their driving is a cosmic injustice. Everyone can justify their own free lunch.

Posted by Orrin Judd at May 14, 2005 8:41 AM
Comments

Without speaking for all middle-class white males (assuming, I suppose, that I'm any of those things), I'm not arguing that raising gas taxes is a cosmic injustice. I'm arguing:

1. I don't want to pay higher taxes.

2. I don't want the government to have more money.

3. It's not clear to me that I don't pay the actual cost of my driving, and a little more besides.

4. Social engineering through taxes is always and everywhere wrong, even when it benefits me. Taxes will always effect the choices people make, and always for the worse. That's no excuse for a small group of elitists to grab hold of the lever in order to leverage a future that only they want.

Posted by: David Cohen at May 14, 2005 9:32 AM

Everyone can justify their own free lunch.

Posted by: oj at May 14, 2005 9:36 AM

"Something for Nothing" is the modus operendi of many politicians seeking to get ahead and of too many voters who believe the highway fairy (or the Social Security fairy) will come in to solve their problems. Down here in Texas right now, the proposal by Gov. Perry to build new toll roads to ease congestion along the main Interstate corridors is being attacked by his potential Republican rivals, Kay Bailey Hutchison and Carole Strayhorn, not just on emminant domain grounds over the land that would be taken for the roads (a more typical Republican complaint) but on the very idea that drivers should have to actually pay for the roads on a per-use basis.

Of course, this is just pandering to the Something for Nothing crowd, no alternative funding plan is offered, and many of the same people who support free highways without supporting sources of funding are the ones angry over any mass transit expansion in urban area, because the systems don't pay for themselves.

Posted by: John at May 14, 2005 9:58 AM

Your inabilty to make some simple distictions reagarding the proper role of the state is what's causing your problem. What furthers the general welfare or provides for the common defense and what does not? Does government act responsibly or does it tend to develop interests of it's own which conflict with the general interest? Is the relatively free movement of goods and services a good thing to be encouraged and enhanced or is it something to be regulated and controlled in the service of highly particular interests who look for support from questionable science or through campaign contributions in order to regulate the freedom of their less connected neighbors?

Self-government implies self-control in the most basic sense. The impulse to impose one's will on the community through the coercive power of the state probably comes from the belief in one's good intentions and special insights. Most of the problems we face as a society come from that all too human tendency which was codified with a vengence during the so-called progresive era. Describing the question of costs as some kind of metaphysical issue with no connection to the real world of relative benefits is a statist specialty always creating the problems of uninitended consequences leading to more difficulties requiring state solutions. Productive economic activity which is the only source of jobs and cost effective goods and services exist today in spite of most government acivity not because of it. oj, you are a meddler with good intentions. When you get your little corner of the world running like the green, utopian clockwork of your imagination, I'll start to take you and your schemes a bit more seriously. Until then direct your bitching at your neighborhood, town and state.

Posted by: Tom C., Stamford, Ct. at May 14, 2005 10:08 AM

Tom:

You ask: What furthers the general welfare or provides for the common defense and what does not?

As I said, you think the stuff you want for free does.

Posted by: oj at May 14, 2005 10:12 AM

You say it's a free lunch, I say that I'm paying my fair share. Prove your position and then we can talk.

Posted by: David Cohen at May 14, 2005 10:41 AM

oj-

I guess we've got a language problem. The story regarding the trust fund highlights the incompetence of the trustees not the taxpayers. It is in their interests to avoid responsibilty. A nation without a manufacturing base or the internal combustion engine seems to be your ideal. The only way to achieve it is through the power of the state to distort the economic incentives in order to make them economically untenable. The trust fund was set up under the premise that increased economic avtivity would support the fund if manged properly. It is beyond the competence of the state to manage anything in a completely disinterested fashion. Why would anyone believe it would start now if given an even higher revenue stream?

Posted by: Tom C., Stamford, Ct. at May 14, 2005 11:05 AM

It's the ones that don't drive that don't pay their way.

Posted by: andy at May 14, 2005 11:11 AM

David;

Well, if the new Highway Bill is going to cost $50 billion per year, we could just start by recouping that in gas taxes.

Posted by: oj at May 14, 2005 11:18 AM

Tom:

Yes, you think that a federal government that builds and maintains a highway network has not intervened in the free market but that one that made users pay for it would have. It's a profoundly odd notion.

Posted by: oj at May 14, 2005 11:20 AM

The Amish are laughing.

Posted by: AllenS at May 14, 2005 11:23 AM

This argument makes perfect sense because we all know that only middle class white males drive.

Your obsession with gas taxes is the equivalent of Andrew Sullivan's obsession with sodomy, leading to riduculous generalizations and extremely weak arguments.

Posted by: Will at May 14, 2005 11:29 AM

Will:

Yes, why do you think talk radio is so conservative? The cars are full of middle class white males. Rush preaches to the choir.

Posted by: oj at May 14, 2005 11:39 AM

"Yes, why do you think talk radio is so conservative? The cars are full of middle class white males."

That's a strange thing to say. News/talk represents just one segment of overall radio listening (17.5 percent in 2004), and conservative talk radio just a small portion of that. There are cars full of people besides middle-class white males, which is why hip-hop, R&B, active rock and hits radio formats are quite prevalent too.

Posted by: SP at May 14, 2005 12:00 PM

A toll is no more a tax than admission to a theater.

Posted by: Genecis at May 14, 2005 12:24 PM

oj-

Markets are not perfect. The interstate highway system,the trans-continental railroad and the erie canal come immediately to mind as examples of the role that the national governmnet can play in developments that actually serve the general welfare. Using them as revenue streams for disconnected social engineering projects is counter-productive and will tend to serve no one's interest other than the political class. Your anti-internal combustion engine and automobile regulation schemes are based on a vision which serve imaginary intetrests as far as I can tell.

Reasonable tolls and taxes should reflect real costs rather than imaginary, polically inflated "social" costs.

Posted by: Tom C., Stamford, Ct. at May 14, 2005 12:36 PM

SP:

locally. Nationally broadcast drive time talk and sports are uniquely aimed at white men.

Posted by: oj at May 14, 2005 12:42 PM

oj-

Markets are not perfect. The interstate highway system,the trans-continental railroad and the erie canal come immediately to mind as examples of the role that the national governmnet can play in developments that actually serve the general welfare. Using them as revenue streams for disconnected social engineering projects is counter-productive and will tend to serve no one's interest other than the political class. Your anti-internal combustion engine and automobile regulation schemes are based on a vision which serve imaginary intetrests as far as I can tell.

Reasonable tolls and taxes should reflect real costs rather than imaginary, polically inflated "social" costs.

Posted by: Tom C., Stamford, Ct. at May 14, 2005 12:44 PM

Well, if the new Highway Bill is going to cost $50 billion per year, we could just start by recouping that in gas taxes.

That's only about another 10¢ a gallon, seemingly doable.
However, the states should collect it, not the Feds.

On top of that, we should collect a dime a gallon to fund a $ 2,000 per vehicle tax credit for buyers of hybrid or CNG vehicles, with maybe a bigger credit for high-milage commercial users in urban areas.
It'd be a lot cheaper than fighting wars over oil.

Posted by: Michael Herdegen at May 14, 2005 12:56 PM

Tom;

So start with reality.

Posted by: oj at May 14, 2005 1:06 PM

Your anti-internal combustion engine and automobile regulation schemes are based on a vision which serve imaginary intetrests as far as I can tell.

High levels of air pollution, typically in urban areas, contribute to thousands of deaths per year in America. The market for automobiles doesn't factor in those costs.

Additionally, if we are going to fight wars over access to oil, rather than power our vehicles with locally producable fuels such as coal or CNG, then the costs of those wars must be bourne by oil users, typically for autos and airplanes.

Posted by: Michael Herdegen at May 14, 2005 1:07 PM

High levels of living life contribute to thousands of deaths per year. Last I looked, life expectancies have been on the steady increase for 250 years. Pollution, to some extent, is the the eye of the beholder. More tax credits in the code? They always work.

Posted by: Tom C., Stamford, Ct. at May 14, 2005 1:47 PM

It's the idea that gax taxes go into the general fund to subside things that have nothing to do with transportation. Worse, even if the fund is restricted to transportation, there's no guarantee those funds will be used wisely. Here in the Upper Left Washington, it turns out the the subsidy the "Sounder", a commuter rail service from Everett south to downtown Seattle gets a annual subsidy of over $60,000 per rider. That's ridiculous, and that money should be spent properly before those agencies get another dime.

(The same goes for bicyclists who snarl up traffic-- until you start paying your share and learing basic traffic rules and courtesy, go play somewhere else.)

Clean up your room and do your homework, and then we'll talk about raising your allowance.

Posted by: Raoul Ortega at May 14, 2005 1:51 PM

---
Gas taxes have been diverted to museums, a symphony hall, a riverside promenade, downtown landscaping projects, snowmobile trails and suburban transit systems that haven't been much more effective than horse trails in reducing road congestion.
---

In Texas, state gas taxes have been diverted to education.

Drivers are paying their way and for the way of other projects. Toll roads aren't objectionable because the money mostly stays within the toll road authorities. Raising gax taxes that pay for non-road pork (or even non-road worthy projects) under the guise of drivers not paying their fair share is not something conservatives should support. It's really no more complicated than that.

I'm beginning to think Orrin just enjoys vexing his conservative readership with his perplexing love of the gas tax. :)

Posted by: kevin whited at May 14, 2005 2:15 PM

High levels of living life contribute to thousands of deaths per year.

Those are individual choices, with individual consequences. To the extent that bad lifestyle choices drive up collective health care costs, we should absolutely attempt to recoup those outlays from the worst offenders.
People driving alone in 12 MPG vehicles affect more than themselves.
The market doesn't price secondary and tertiary effects well, if at all.

Last I looked, life expectancies have been on the steady increase for 250 years.

And therefore undercutting that trend is OK ?

Pollution, to some extent, is the the eye of the beholder.

True enough.
In fact, almost literally true, since if one can see the air pollution, it's way too much.

More tax credits in the code? They always work.

The mortgage interest deduction and capital gain exclusion for homes have been spectacularly successful in promoting home ownership among Americans.
Why would one assume that demand for hybrid and LNG vehicles would not increase if buyers could get a two grand rebate for purchasing one ?
Arizona tried just such a programme a few years back for alternative fuel vehicles, and they had to shut it down because it was wildly oversubscribed.

Posted by: Michael Herdegen at May 14, 2005 2:30 PM

"locally. Nationally broadcast drive time talk and sports are uniquely aimed at white men."

??

This doesn't make your point, which was: Conservative talk radio proves that driving is dominated by middle-class white males.

There's a basic logical fallacy in here somewhere.

Posted by: SP at May 14, 2005 2:31 PM

You can fiddle your dial until you find a hip-hop channel in a few cities. You can find Rush everywhere in America at a prominent spot on the dial. Gangbangers aren't driving to work.

Posted by: oj at May 14, 2005 2:37 PM

i really must visit oj's world sometime, it sounds so "exotic" (just the opposite, really). where i live, there are as many radio stations for spanish speakers as for english. there are several asian language stations, too. sure rush is in there but so is a whole lot more. and that doesn't even begin to address what is available from xm. get out and see the world, its not so scary as all that.

Posted by: cjm at May 14, 2005 3:12 PM

Ever seen the ratings book?

Posted by: oj at May 14, 2005 3:15 PM

More to the point, between noon and 3 you get salesmen and people who go out to lunch.

Michael: Raising $50 billion would take a gas tax of 50 cents per gallon, but I'm not sure why we have to ignore the approximately 40 cents per gallon of state and federal taxes we pay now. Also, it's surprisingly hard to show that the mortgage interest deduction has much effect on levels of home ownership.

Genecis: Are user fees taxes? I tend to think not, and so I don't get excited when government raises them. But this only applies if the fee approximates the cost of the service rendered, which no one here has even tried to show. Also, there's always the nagging questions of why, if fees can be charged to cover the cost of a service, the government has to be involved at all.

Tom: Markets are perfect, for all practical purposes. Allowing for the possibility that markets are imperfect only encourages leftists like OJ.

Posted by: David Cohen at May 14, 2005 3:23 PM

You're revealing a unique brand of myopia here.

As I pointed out, news/talk radio represented 17.5 percent of listenership -- NATIONALLY. Note that those 2004 Arbitron figures don't even separate all-talk from all-news, so can't know what the actual percentage is for talk itself. (We do know there are plenty of news-only stations, so it's safe to say that talk made up less than that 17.5 percent.)

We also don't know what share of that listening took place in cars. For all you know, Limbaugh's audience is made up mostly of people sitting in their homes -- lower-class old ladies sitting in their homes.

You've attemped to prove that most car drivers are middle-class white males (MCWMs, for ease) by pointing out the ubiquity of conservative talk radio. That's a clumsy logical leap, because that ubiquity doesn't prove anything about the makeup of car drivers.

Still, let's grant for the sake of argument that the vast majority of these talk-radio listeners are indeed MCWMs. And let's grant that talk radio is listened to primarily in automobiles. It still wouldn't serve as evidence that most drivers are MCWMs. It doesn't account for the fact that this one strand of radio -- no matter how widespread -- is not more prevalent than all the other strands put together.

Heck, it very well could be that most drivers are MCWMs. But conservative talk radio isn't the evidence that proves it.

(And just for the record, hip-hop's audience includes far more than "gangbangers." After country music -- whose audience is fairly diverse in gender, class and culture -- hip-hop is the biggest format in modern radio. It is the reigning pop genre of the era, and its own audience is quite demographically diverse.)

Posted by: SP at May 14, 2005 3:27 PM

"Ever seen the ratings book?"

Well, I have. I work in the music business. If you'd like some hard facts -- rather than top-of-the-head inferences -- I'll be happy to snag some quick data for you.

Posted by: SP at May 14, 2005 3:30 PM

SP:

Sure, who else puts up the kind of number nationally that Rush, Glenn Beck, Imus, Howard Stern, etc, put up.

Posted by: oj at May 14, 2005 3:41 PM

Better yet, what are their respective ad rates?

Posted by: oj at May 14, 2005 3:42 PM

Strikes me that if we could ever keep the congress's hands out of the highway trust fund or the social security trust fund, we would not be in this mess. It is the dumping of all this money into the general revenue that is causing the problem. If you are taking money for a purpose, restrict it for that purpose; otherwise don't take it.

Posted by: dick at May 14, 2005 3:48 PM

dick-

The social engineers on this thread want to tax the internal combustion engine out of existence. It doesn't matter what the funds are used for, only that they reflect their wishes rather than the costs, most of which only they are aware of. They don't want manufacturing jobs either. The US is too advanced to have to make things.

Posted by: Tom C., Stamford, Ct. at May 14, 2005 6:45 PM

Tom:

Think anyone here dreams of their kid working an assembly line?

Posted by: oj at May 14, 2005 6:51 PM

It's cultural. It's not just God, Guns, and Guts: it's also cars. One may like the idea of a soccer-watching, umbrella-clutching, bus-awaiting civilization, but he would not like the world that came about in the absence of American culture.

Posted by: Lou Gots at May 14, 2005 7:58 PM

OK, Mr. Train: do you want to ride behind a steam locomotive belching black smoke and straining to go maybe 50-60 mph, or a modern diesel going 70-90 mph?

And I'll bet a lot of the "newest" Americans would be happy if their kids were working at an Intel plant in Phoenix, or a Honda plant in Ohio, or a Nissan plant in Tennessee, or the BMW plant in South Carolina, or the Mercedes plant in Alabama.

Posted by: ratbert at May 14, 2005 10:56 PM

Dreams don't pay the rent. Not every kid can finish college. Work is good.

Posted by: Tom C., Stamford, Ct. at May 14, 2005 11:12 PM

I have an idea, how about putting the Highway Trust Fund $ into a lock box!

Posted by: Phil at May 14, 2005 11:21 PM

rat:

I'm in no hurry to get anywhere.

Posted by: oj at May 14, 2005 11:34 PM

David Cohen:

The U.S. use 5 billion barrels of oil annually just for gasoline, diesel, and jet fuel, so it seems that we would have to raise taxes by 25¢ per gallon of transportation go-juice, to hit $ 50 billion a year in new tax revenues.

Markets are perfect, in the long run, (and that may be a very long run indeed, spanning decades), but ONLY with regards to those elements of human activity that can easily be valued, or where responsibility can be easily assigned.
Once we move outside of those boundries, markets work very poorly, because they don't receive enough information to correctly establish pricing. Values are assumed, or arbitrarily assigned.

Like markets, a hammer is a perfect tool, but not all problems involve nails.
Market forces only operate efficiently where information is available, and where market elements are liquid.

dick:

You are absolutely correct.

Tom C.:

The social engineers on this thread want to tax the internal combustion engine out of existence.

Or, simply make ICE users pay the full and fair cost for their previously subsidized use.
As I previously noted in this thread, we could simply produce ICEs that burned a coal slurry, and by using them for all ground transportation, America could meet ALL of her energy needs through domestic production.
However, almost nobody would be willing to switch to such a system unless forced to, since it would cost more than we are used to.

Anyway, what's so hot about the ICE ?
There are many advantages to fuel cell or electric moters, once we get the price problem licked.

The US is too advanced to have to make things.

That is exactly correct.
We should design, market, and sell stuff, not be putting Tab A into Slot B 10,000 times a day.
There was a time when 90% of Americans worked, at least part of the time, at some kind of agricultural job. Now it's 2%, but America still produces TWICE as much foodstuff as is required to feed all of her citizens.
Similarly, America will retain a manufacturing base, especially in the high end, precision fields, but fewer and fewer people will work in those areas.
That's not due to some Master Plan, that's the invisible hand at work.

Lou Gots:

Sure, cars are embedded in American culture, but cars don't have to use ICEs. A fuel cell powered vehicle is still a "car", and will be used in the same way.

Posted by: Michael Herdegen at May 15, 2005 12:10 AM

Michael: This time I got 36 cents, if we don't assume that it has any effect on consumption. Of course, if it doesn't have any effect on consumption, why bother. By the way, why on Earth would we agree that each years highway bill should be paid for with new taxes. Let them use the taxes they've got, which now that I've recalculated, appears to be enough to foot the bill.

The market is perfect for all practical purposes, meaning that the government's guess is always going to be worse.

Posted by: David Cohen at May 15, 2005 12:33 AM
There are many advantages to fuel cell or electric moters, once we get the price problem licked.

Ah, hah. Hah hah hah Hah hah hah Hah hah hah Hah hah hah Hah hah hah Hah hah hah Hah hah hah Hah hah hah!!! ....
....
....

Whew! OK, now that I'm done ROFL'ing, I'll say that was pretty good. You mention "that price thing" as it were somehow extrinsic to the technology in question. The Star Trek transporter, when you come down to it, is just a matter of getting the price thing licked too, it just has further to go, i.e. we can't even afford to start the basic research on it yet.

Meanwhile back on planet Earth in the year 2005, the ICE and fossil fuels are cheaper than fuel cells and electrics for the shocking reason that they really do cost less than the alternatives.

Posted by: at May 15, 2005 1:33 AM

Michael-

Do you honestly believe that the invisible hand is responsible for GM's pension and health care costs?
Management agreed to those benfits with a gun to their head and they were nudged along by political pressures. The NLRB and the closed shop rules are matters of political expediency and short sightedness. The interests of the state always trump the short and long term interests of everyone else.

Posted by: Tom C., Stamford, Ct. at May 15, 2005 10:05 AM

You mention "that price thing" as it were somehow extrinsic to the technology in question

That's because it is.
There are two problems with your analysis: You don't include all costs associated with the current system, and your underlying assumption is that technology will not advance.
In 2005, the average American can buy, with one week's net income, a computer that fifty years ago would have cost more than her lifetime gross earnings.
Fuel cells and batteries will similarly advance.

As for the "Star Trek transporter", not only have we started the research, we have a working model that can "transport" one atom.

Tom C.:

Then how do you explain GM's Saturn division, or the BMW, Honda, and Toyota plants of the American south ?
The unions didn't put the gun to GM's head, GM's management did that. The unions merely exploited it.

Posted by: Michael Herdegen at May 15, 2005 2:24 PM

Michael: Batteries are pretty much at their theorectical limits. Gains from here on out will come from reducing power demands from the equipment.

Posted by: David Cohen at May 15, 2005 4:50 PM

That also holds for ICEs, which are nearing their limits of thermal efficiency ( somewhere between 40 and 50 per cent for diesels.) The latest automotive diesels are already bumping up against that.

Posted by: joe shropshire at May 15, 2005 5:23 PM

Michael:

fuel cells and batteries will similarly advance.

Unless they don't. You're ultimately referring to Moore's Law, of course, which holds that the amount of computing power you get for a dollar doubles every 18 months or so; and you assume there's a Moore's Law for power generation. Except there isn't: there's a Moore's Law (so far) for etching integrated circuits on silicon, and that's about it. Lots of technologies advance for decades, and then stop advancing, and stay that way.

Posted by: joe shropshire at May 15, 2005 5:30 PM

Unions exploited to such a degree that their jobs and pensions are about to go pooof! Shrewd.

Posted by: Tom C., Stamford, Ct. at May 15, 2005 8:40 PM

David Cohen:

Batteries are being built of materials that can be molded into any shape necessary. Once that process gets better, we'll be able to build vehicles in which the batteries serve a dual purpose, such as also being the frame.
Then, even if the batteries are only as efficient as those of today, the vehicle will be much lighter, and therefore, as you say, will use less power.

joe shropshire:

I'm refering to the fact that fuel cells and batteries have been getting better for decades, although of course my underlying assumption is that further gains are, in fact, possible.

However, I'd love to see your list of technologies that have stopped advancing. It's probably much shorter than you believe that it is.
Even toasters have been significantly improved since the 70s.

Seriously, look around you. Other than the shape of homes, what has stopped being improved upon ?

Tom C.:

Unions must bear some of the blame for GM's woes, but I think that it's hilarious that you refuse to blame GM's management for any of the company's problems.
Look at what Ghosn has done with Nissan, and then tell me that unions are the determining factor in whether an auto manufacturer makes it, or not.

Posted by: Michael Herdegen at May 15, 2005 11:41 PM

Management folded in the 60's and 70's. Why shouldn't they have? Things looked good as far as the eye could see while laborregulations left them little wiggle room. Who exected Japan to be a long term threat to GM? Management,organized labor and government are all to blame. Greed, short-sightedness and political expediency.

Posted by: Tom C., Stamford, Ct. at May 16, 2005 9:05 AM
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