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"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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^From what I've seen on other forums, the conservative response to this seems to be that: user fees would cover the entire cost of roads, if a portion of them weren't siphoned away to pay for other "pet projects," like mass transit.

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Then tell them that if the 13% of gas tax revenue that is used for mass transit was diverted to highways (and remind them that gas taxes are only used for highways, not the bulk of surface streets) then the "user fees" would cover 65% of highway expenditures rather than 52%. 

 

It's the highway thing that really needs to be brought more out into the light anyway.  Even though the shortfall in gas tax revenue is big, the vast majority of the street network isn't even part of the equation, and isn't paid for by any sort of user fee at all. 

 

 

Disposition of State Motor-Fuel Tax Receipts - 2008

http://www.fhwa.dot.gov/policyinformation/statistics/2008/mf3.cfm

 

In 2008 the States had just under $38 billion in State gas taxes to distribute.

 

49% ($18.8 billion) of State gas taxes go to pay for State administered highways. 

29% ($11.1 billion) pay for local roads and streets.

12% ($4.5 billion) pays for mass transit

The rest goes to State non-highway uses, the State's general fund, and other things.

 

Funding For Highways and Disposition of Highway-User Revenues, All Units of Government, 2008

http://www.fhwa.dot.gov/policyinformation/statistics/2008/hf10.cfm

 

Disposition of Highway-User Revenue (State and Federal gas taxes, I think also vehicle registration):

67.06% ($122.1 billion) in receipts available for distribution as percent of total disbursement for highways [$36.6 billion Federal, $80.1 billion State, $5.4 billion Local]

-4.56% (-$8.3 billion) for non-highway purposes

-8.38% (-$15.2 billion) for mass transit

-2.35% (-$4.2 billion) for collection expenses

-0.06% (-$103 million) for territories

 

51.72% ($94.1 billion) net total remaining

 

So this means that the total receipts for user fees, most of which are State and Federal gas taxes, only cover 67% of of the amount spent on highways.  Other uses for those funds decrease the amount available to road projects to just under 52%.  That means the remaining 48% must be subsidized from other sources as shown below.

 

Revenues Used for Highways

51.72% ($94.1 billion) from user fees (gas taxes and tolls)

4.57% ($8.3 billion) from local property taxes

22.19% ($40.4 billion) from general fund appropriations [$10.6 billion Federal, $6.8 billion State, $23 billion Local]

6.84% ($12.4 billion) from other taxes and fees

9.60% ($17.5 billion) from investment income and other receipts

10.95% ($19.9 billion) from bond issue proceeds

-5.86% (-$10.7 billion) to intergovernmental payments

 

100% ($182 billion) net total

 

Note that the above statistics are only for State and Federally operated roads and highways, which are Interstate and US highways and numbered State routes.  A few select local streets are included in some states.  This mainly includes non-interstate highways through municipalities.  The remainder of the local street network, is entirely funded out of local sources, mostly property taxes.  User fees do not fund most streets at all.

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^From what I've seen on other forums, the conservative response to this seems to be that: user fees would cover the entire cost of roads, if a portion of them weren't siphoned away to pay for other "pet projects," like mass transit.

 

The transit portion of the gas tax has been existence since 1982. What is different today is that fewer people are driving or are using more fuel efficient vehicles which means fewer gas taxes. It's only going to get worse as the Baby Boomers continue to retire and drive less. So the highwaymen want to hoard as much money as they can to keep their own gravy train solvent. In other words, they want to spend more money on roads that people are using less, by taking money from transit that people are using more.


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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For a perhaps interesting lesson to conservative opponents of transit, I would suggest adding in Amtrak on that table and see where it ranks.  At least according to Amtrak (I'll accept the stat as written, but to be fair to the Tax Foundation, it ought to be defined with a little more detail, especially if there are costs subsidized elsewhere that escape the denominator in this stat), its "farebox recovery" (operating costs covered by fares) was 79% in 2010.

 

In that state ranking, that would put it at #2 out of the 50 states, just behind Delaware at 79.8%.  Delaware, of course, gets significant toll revenue from I-95, which is a toll route basically the entire length of the state.

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For a perhaps interesting lesson to conservative opponents of transit, I would suggest adding in Amtrak on that table and see where it ranks.  At least according to Amtrak (I'll accept the stat as written, but to be fair to the Tax Foundation, it ought to be defined with a little more detail, especially if there are costs subsidized elsewhere that escape the denominator in this stat), its "farebox recovery" (operating costs covered by fares) was 79% in 2010.

 

In that state ranking, that would put it at #2 out of the 50 states, just behind Delaware at 79.8%.  Delaware, of course, gets significant toll revenue from I-95, which is a toll route basically the entire length of the state.

 

In 2012, Amtrak covered 86 percent of its operating costs by fares.


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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Once Amtrak starts making money (I'm going to guess within 10 years) Conservatives will complain that fares are too high and they are gouging riders....

 

They still wont be making money because that is only operating costs. Capital projects is where most of the losses come, as is expected.

 

If airlines had to build their own infrastructure they would be in even worse condition.

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Ah... good point. Hadn't thought about that. Once Amtrak starts making money on ops and can focus more on (capital) infrastructure, things could be very good for them as they could continue to make incremental improvements which could result in even higher revenues.

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Once Amtrak starts making money (I'm going to guess within 10 years) Conservatives will complain that fares are too high and they are gouging riders....

 

They still wont be making money because that is only operating costs. Capital projects is where most of the losses come, as is expected.

 

If the highway stats include capital expenditures (and I assume that they must, since basically all they do is build and maintain the fixed capital) and the Amtrak stats don't, then that obviously changes the equation significantly.  What percentage of Amtrak's *total* costs were covered by fares?  (And if there's some other accounting magic separating out actual, tangible highway costs from the figures already discussed, I'd want to see the total costs of highways as well--still limited to direct costs, because indirect costs are more exercises in politics than economics, but all direct costs.)

 

If airlines had to build their own infrastructure they would be in even worse condition.

 

True as far as it goes, but don't the port authorities charge the airlines for the use of the spaces at the terminal?  If so, then the economics of that transaction are essentially airlines as lessors of space, not owners, but that's still a perfectly legitimate business arrangement and doesn't necessarily imply subsidization.  The subsidization is only the amount of taxpayer dollars that are needed to pay off the bonds issued by a given port authority or whatever other entity actually issues the debt for the airport.

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Airline "infrastructure" includes air traffic controllers and radar.  The airlines (and passengers) pay for use of the airports, all taxpayers pay for the air traffic controllers.  The public (port authority) also takes on the risk in building an airport in anticipation of airlines wanting to use it.

 

Despite that support, every major airline has gone through bankruptcy at least once, and the entire industry was bailed out after 9/11.

 

Amtrak also operates on privately-owned rail and pays "rent" for using those lines.  Amtrak owns very little track of its own.  The freight rail companies gladly sold their passenger business to Amtrak.  The port authority also does not build passenger rail stations for Amtrak to rent...

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In that case, for the sake of doing the comparisons, I'd simply make "air" into two separate line items (airlines and airports) so that they could be examined together or separately.

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Once Amtrak starts making money (I'm going to guess within 10 years) Conservatives will complain that fares are too high and they are gouging riders....

 

They still wont be making money because that is only operating costs. Capital projects is where most of the losses come, as is expected.

 

If the highway stats include capital expenditures (and I assume that they must, since basically all they do is build and maintain the fixed capital) and the Amtrak stats don't, then that obviously changes the equation significantly.  What percentage of Amtrak's *total* costs were covered by fares?  (And if there's some other accounting magic separating out actual, tangible highway costs from the figures already discussed, I'd want to see the total costs of highways as well--still limited to direct costs, because indirect costs are more exercises in politics than economics, but all direct costs.)

 

If I am not mistaken, much of the capital infrastructure for Amtrak is built by freight companies. There is a big reversal in roads-to-railroads comparison, where most of the public expenditure for roads is capital and most of the expenditure for railroads is operations. (Edit: And, likewise, operations are largely a private expenditure for roads, while infrastructure is the private expenditure for railroads.) So it's hard to do an apples-to-apples comparison. The northeast corridor is the only track I know of which is actually owned by Amtrak. If it were separated from the rest of Amtrak's operations, I would think it makes money even when capital expenditures are factored in.

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I know that; that's why I'd want to see total costs for the highways vs. Amtrak.  The total cost is the most important number in most laypeople's minds, anyway--and dealing with the costs at that level also eliminates the comparative effect of that imbalance between capital and operating costs.

 

Of course, to the extent that Amtrak uses other companies' rails, those capital costs might properly be excluded from Amtrak's total costs, leaving only any fees it pays the freight rail companies that actually own the lines.  If those freight rail companies' construction of those lines was partially government subsidized, however, that would allow Amtrak to disguise a subsidy that it gets to enjoy (along with the freight rail companies who were actually the direct recipient of the same, of course).  I actually don't know how much we subsidize the freight rail infrastructure, but I'm sure we do.  (I know that the Heartland Corridor at least got an earmark in at least one FY budget, probably more than one, and that's just one line.)

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Freight rail gets very very little subsidy at all.  It's the least subsidized transport system in the US.  To get to any meaningful subsidy you have to go back to the mid 1800s when the right-of-way for many railroads (mostly west of the Mississippi, but not entirely) was simply given to to the railroads by the US government.  The exchange for that of course was the government's ability to tax the railroad land and the newly valuable land of the towns and villages that sprang up along them. 

 

The thing to remember though is that railroads still pay property taxes on their land today, more so if it's better maintained and equipped, while streets and highways do not.  I figure that airports probably don't either, but I'm not 100% positive on that one.  Either way, it's one of the perverse disincentives to improving the country's rail system, because those improvements increase the tax burden on the railroad company.  This is why extra tracks are abandoned or scrapped, same with overhead electrical systems, and why even busy lines can be rather ramshackle affairs.

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So when roads are priced at market rates, few want to use them? SHOCKER

 

Investors Take their Licks from Toll Road Projects

Posted on November 21, 2013 by James A. Bacon| 30 Comments

by James A. Bacon

 

Private investors have pumped about $27 billion into toll-road deals in the United States since 2003, estimates the Wall Street Journal in an article today. Many of them have gone bust. The root problem: Not enough drivers. During the go-go years of the 2000s when traffic counts were soaring and real estate development in resorts and on metropolitan peripheries portended ever-increasing traffic, private investors made a lot of bad bets.

 

After peaking at three trillion miles in 2007, Vehicle Miles Traveled in the United States embarked upon their steepest and most prolonged decline since World War II. Many of the hoped-for real estate projects stalled or went belly up and the anticipated traffic never materialized. The WSJ points to the example of the Foley Beach Express toll bridge in Alabama. American Roads LLC banked on 10 million drivers in 2012. The actual number: 2.3 million. American Roads filed for bankruptcy protection in June. The article also mentions the Pocahontas Parkway outside Richmond, for which Transurban Ltd. paid the Commonwealth $600 million only to write off its investment several years later.

 

Some commentators may cite these numbers as evidence that public private transportation partnerships are a bad idea. I draw the opposite conclusion. The system is working exactly the way it should.

 

READ MORE AT:

http://www.baconsrebellion.com/2013/11/investors-take-their-licks-from-toll-road-projects.html


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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So when roads are priced at market rates, few want to use them? SHOCKER

 

Investors Take their Licks from Toll Road Projects

Posted on November 21, 2013 by James A. Bacon| 30 Comments

by James A. Bacon

 

Private investors have pumped about $27 billion into toll-road deals in the United States since 2003, estimates the Wall Street Journal in an article today. Many of them have gone bust. The root problem: Not enough drivers. During the go-go years of the 2000s when traffic counts were soaring and real estate development in resorts and on metropolitan peripheries portended ever-increasing traffic, private investors made a lot of bad bets.

 

After peaking at three trillion miles in 2007, Vehicle Miles Traveled in the United States embarked upon their steepest and most prolonged decline since World War II. Many of the hoped-for real estate projects stalled or went belly up and the anticipated traffic never materialized. The WSJ points to the example of the Foley Beach Express toll bridge in Alabama. American Roads LLC banked on 10 million drivers in 2012. The actual number: 2.3 million. American Roads filed for bankruptcy protection in June. The article also mentions the Pocahontas Parkway outside Richmond, for which Transurban Ltd. paid the Commonwealth $600 million only to write off its investment several years later.

 

Some commentators may cite these numbers as evidence that public private transportation partnerships are a bad idea. I draw the opposite conclusion. The system is working exactly the way it should.

 

READ MORE AT:

http://www.baconsrebellion.com/2013/11/investors-take-their-licks-from-toll-road-projects.html

 

So when roads are priced at market rates, few want to use them? SHOCKER

 

That isn't what I read in the article. Drivers did not avoid the toll, they didn't take that road (as much as investors hoped for) because of

real estate developments that never got off of the ground or failed completely. Driving went down due to a really bad economy.

 

 

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Maybe the real estate developments didn't happen because the traffic didn't materialize? Usually the road comes first, then the real estate development follows in the decades thereafter as a publicly funded road can survive the bad times too. But that's when roads are built by governments. With privately funded roads, how many investors are willing to wait decades for a return on their investment?


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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That isn't what I read in the article. Drivers did not avoid the toll, they didn't take that road (as much as investors hoped for) because of

real estate developments that never got off of the ground or failed completely. Driving went down due to a really bad economy.

 

 

 

Today's economy is actually pretty normal. The sprawl machine running at full steam regardless of demand or people's ability to afford it was not.

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Well, part of the question is the elasticity of demand, which when it comes to physical infrastructure takes the form of people taking alternate routes.

 

In practice, for as long as remotely reasonable alternatives exist that do not involve passing through toll booths, people have shown a remarkable (even irrational, I'd say) willingness to travel farther in order to avoid paying tolls.  Granted, not all tolls are created equal.  But for example, when I go from Akron to Cleveland-Hopkins, I almost always take the Turnpike.  The toll to get from I-77 over to I-71 is tiny ($0.75) and I easily save that much in gas, time, and hassle because the alternative means looping up to I-480.  Yet I really feel like I'm in the minority.  When I first told my wife that I intended to take the Turnpike when I was driving her to the airport, she looked at me like I was crazy and was about to bankrupt the household.  I know many others who feel similarly ... I almost feel like they get a sense of personal accomplishment out of having avoided the toll booth even if it means they took a longer (and thus costlier) way around.

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If I can find an equal (in distance and/or time) alternative to the toll road, I also find it to be a sense of accomplishment. For example, I drove to New Jersey last July via Harrisburg. The natural thought would be to take the Ohio and Pennsylvania turnpikes, right? Nope.

 

I found that if I took US 422, SR 82, SR 11, I-80, US 220, SR 144, and US 322 (which took me to I-81 and I-78), I avoided more than $30 in tolls yet my distance from Cleveland to Harrisburg was 249 miles. How far was the "more direct" turnpike route? 249 miles. And my travel time from Cleveland to Harrisburg was about four hours because most of the distance was via interstates or at least interstate-quality roads. The only two parts that weren't were via fast 50 mph roads (US 422 in Geauga County) and SR 144 over Bald Eagle Mountain around State College (a very scenic route!!).


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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Love it! Had to share......

 

1495495_809606879064825_329478020_n.jpg


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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I had an ancien neighbor with an ancient tractor & he would frequently plow before the city would.

and, heck, one of the city plow drivers lived across the street.

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We all know roads get a pass on subsidies while rail/transit subsidies take a beating. So share your road subsidy example that may be news to you. Here's mine. Yep, NS directly subsidizes its competition....

 

Selling railroad system could boost pension fund, but is it worth it?

Railway sale may help fund retirement program, but critics worry about losing constant revenue stream

Jan. 9, 2014

Written by James Pilcher

 

The idea of selling Cincinnati’s most unique and perhaps most valuable asset is being raised again, this time as a way to help the city get out from underneath its massive pension problems.

 

...Rail company Norfolk Southern now pays more than $20 million annually to lease the line that runs from Cincinnati to Chattanooga, Tenn. Since the lease was renegotiated in 1987, the railroad has paid the city $432 million in lease payments, all of which go directly into Cincinnati’s capital budget. The lease runs until 2026, although Norfolk Southern has an option at that time to extend it another 25 years.

 

...That continual stream of revenue is just one of the reasons Mayor John Cranley listed when voicing opposition to the idea in an interview with The Enquirer. The revenue is set aside for capital projects such as maintaining roads and bridges, Cranley said.

 

READ MORE AT:

http://news.cincinnati.com/apps/pbcs.dll/artikkel?NoCache=1&Dato=20140109&Kategori=NEWS01&Lopenr=301090134&Ref=AR


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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Should we raise the cost of driving in Ohio 44% so that passenger #rail doesn't have to be subsidized?

How would you live differently if you had to pay nearly 2 times more to drive?

 

Transportation Insider

By Rick Rouan

The Columbus Dispatch • Monday January 13, 2014 5:03 AM

 

Money raised from Ohio’s gas tax has been flattening for years, but a recent report by the Tax Foundation has found that the state raises a greater share of money for roads from fuel taxes, user fees and tolls than about three-quarters of the country.

 

The Washington, D.C.-based tax-research group analyzed 2011 data from the U.S. Census Bureau to find that fuel and license taxes and road tolls make up about 56 percent of road funding in Ohio.

 

That ranks Ohio 12th in the United States and is higher than the 50 percent national average.

 

READ MORE AT:

http://www.dispatch.com/content/stories/local/2014/01/13/freeze-puts-bike-share-ridership-on-ice.html


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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That's not actually the way it would work, of course.  Increasing the cost of driving 44% would not actually increase revenue received by 44%.  But perhaps that's part of the point.

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That's not actually the way it would work, of course.  Increasing the cost of driving 44% would not actually increase revenue received by 44%.  But perhaps that's part of the point.

 

My point is there needs to be a level playing field, and don't tell me "life isn't fair." We at least try to be fair, not try to pick winners and losers and then lie that transportation modal choices are the result of the free market.

 

If I'm a store owner and I see my competitor nearby running a retail business from a building owned by the city where the business owner has to pay only 56 percent of the cost of using that building while I'm being asked to pay 100 percent, then I'm going to be mad. I either want the same deal he's got, or I want him to have the same deal I've got.


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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Should we raise the cost of driving in Ohio 44% so that passenger #rail doesn't have to be subsidized?

How would you live differently if you had to pay nearly 2 times more to drive?

 

Transportation Insider

By Rick Rouan

The Columbus Dispatch • Monday January 13, 2014 5:03 AM

 

Money raised from Ohio’s gas tax has been flattening for years, but a recent report by the Tax Foundation has found that the state raises a greater share of money for roads from fuel taxes, user fees and tolls than about three-quarters of the country.

 

The Washington, D.C.-based tax-research group analyzed 2011 data from the U.S. Census Bureau to find that fuel and license taxes and road tolls make up about 56 percent of road funding in Ohio.

 

That ranks Ohio 12th in the United States and is higher than the 50 percent national average.

 

READ MORE AT:

http://www.dispatch.com/content/stories/local/2014/01/13/freeze-puts-bike-share-ridership-on-ice.html

 

Bizarre column. In terms of public perceptions, this is a man-bites-dog story that turns conventional wisdom on its head: auto use does not come anywhere close to paying for roads. Yet it's buried beneath a dog-bites-man story about fewer casual bicyclists riding when it's 10 below zero. And then it makes it sound like positive news because Ohio's record isn't as abysmal as those of other states.

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Miles-driven per capita is falling. Gas tax revenues are falling. So what are we doing? Yep, adding more roads! And the federal highway fund has already been bailed out multiple times since 2008 with general tax subsidies to keep the roadbuilders a-building!

http://www.taxadmin.org/fta/meet/11_mf/pres/lee.pdf

 

January 15, 2014, 03:23 pm

Highway funding will run out in September

By Keith Laing

 

Federal funding for road construction projects will run out in September unless Congress appropriates additional money, the Department of Transportation said on Wednesday.

 

The department released a Highway Trust Fund tracker that showed the fund has about $8.5 billion left. The figured included $9.7 billion that was transferred from the federal government’s main funding account at the beginning of the 2014 fiscal year in October.

 

The agency said “surface transportation program continues to outlay at a greater pace than receipts are coming in.”

 

 

Read more: http://thehill.com/blogs/transportation-report/highways-bridges-and-roads/195563-dot-highway-funds-will-run-out-in#ixzz2qcCVE3t0

 


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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Why does the Lancaster bypass jump into my head upon reading this.

 

Lancaster? Or Portsmouth?


"Fascism begins the moment a ruling class, fearing the people may use their political democracy to gain economic democracy, begins to destroy political democracy in order to retain its power of exploitation and special privilege." -- Tommy Douglas, Scottish-born Canadian Baptist minister and the seventh Premier of Saskatchewan

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