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The projected slowdown in the us economy will result

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Unformatted text preview: revenues from other streams since their operating costs cannot be compensated by existing revenue. For instance, public transport systems are subsidized in part by revenues coming from fuel taxes or tolls. 7|Page Taxes Bad DA BDL Answers to: Pay for the Plan Another Way [_____] No money now for new transportation – New programs would require more taxes Robert Poole, director of transportation at Reason Foundation, 2011 (“Advocates Calling for More Transportation Spending Need to See the Big Budget Picture,” Reason, http://reason.org/news/printer/advocates-calling-for-more-transpor) What this changed context means for transportation is the subject of this column. The grandiose dreams sketched out only three years ago by the Policy & Revenue Commission for a massively expanded federal role, and echoed in 2009 by Rep. Jim Oberstar (D-MN, who lost his seat in the 2010 elections), have become irrelevant - despite still being reflected in President Barack Obama’s original 2012 budget proposal to more than double the size of the program. Economist Robert Samuelson put his finger on the problem in a recent column in the Washington Post, “Big Government on the Brink.” We have created what he calls a “suicidal government,” by which he means that “government has promised more than it can realistically deliver and, as a result, it repeatedly disappoints by providing less than people expect.” And as a result, he writes, “The system can no longer make choices, especially unpleasant choices, for the good of the nation as a whole.” Rep. Paul Ryan’s (R-WI) plan to reduce federal spending over the next decade down to 20% of Gross Domestic Product (GDP) was attacked as a radical fantasy when first introduced, but in a few short weeks it so changed the debate that the president submitted a replacement for his original 2012 budget plan, with the new version looking more like Ryan’s plan over the next few years (even though aiming only to get down to 22% of GDP in the out years). The Gang of Six in the Senate, like President Obama’s deficit reduction commission from last fall, is talking about eliminating countless sacred-cow “tax-expenditures” as part of wide-ranging tax simplification. There is even serious talk about scrapping tax-exempt municipal bonds. Yet as I read the missives put forth by every major transportation group, I see calls for larger programs and greater federal spending, as if none of this larger context exists. But the fact is, the federal transportation program that has grown tremendously since creation of the Highway Trust Fund in 1956, and is due for radical surge ry. Business-as-usual in transportation—as in every other federal program—is no longer an option. In the short-term (i.e., the current reauthorization bill), there will be no federal fuel tax increase and the program will be sized to what existing highway user taxes bring in. Period. Bills to increase tax rates must originate in the House, and not even the White House is proposing an increase. There is no general fund money available to supplement what gas taxes bring in. Consequently, we need to learn to live with this new reality 8|Page Taxes Bad DA BDL Tax Incr...
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This document was uploaded on 02/06/2014.

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