Highway bonds

Columbia Daily Tribune

Give Sen. Jim Talent credit for thinking federal as the best venue for increasing highway funding. ... He wants the government to issue as much as $30 billion in bonds to help states fix transportation systems.

The bonds would be bought by individuals and businesses and repaid with federal income tax credits. The money raised would be in addition to the basic federal highway bill, now under negotiation in Congress. ...

Sen. Talent properly recognizes the states are stymied in efforts to raise adequate funding on their own. ...

Even if state tax increases are begrudgingly passed here and there, policy-makers peer warily over their shoulders at taxing policies in neighbor states ... .

So raising money at the federal level for distribution to the states makes sense, but Talent's bond idea ... does not raise new money.

The funds are borrowed from future tax revenues, some of it perhaps even coming from regular annual highway expenditures. ...

A better way, I think, and one that would be politically palatable and last forever, is to raise the federal motor fuel tax. ...

The tax should be at least 10 cents a gallon and perhaps 15 cents for diesel fuel, finally recognizing in a substantial way the extra wear and tear big transport trucks cause. The money would be sent back to states in the same proportion each generates. States would make their own plans.

Some of the resulting revenue might be used in some states to finance bonds so work could get under way more quickly, though pay-as-we-go funding lets dollars go farther.

Can one imagine a more red-blooded Republican project than building transportation infrastructure without borrowing money? What a great vehicle for our two Senate leaders, obviously seeking good reputations for the future. ...