Back in 2015, the U.S. Department of Transportation ranked the world’s roadway systems and found that the U.S. highway system is number 16 in the world, behind Portugal! At the time, the report estimated that America needed to invest $189 billion in road repair, plus another $48 billion to fix nearly 73,000 bridges! That’s $237 billion, folks!
Here is an article from CBS News:
Worse still, the American Society of Civil Engineers (ASCE) has issued a report that the poor quality of America’s roadways will cost the country, “876,000 jobs and suppress the growth of our GDP by $897 billion by the year 2020.” That’s a lot of jobs and a lot of lost money.
If you’re keeping up with the math here folks, if we invest $237 billion in our roads, we will save 876,000 jobs and $897 billion in GDP! That’s a net gain of $660 billion (plus a ton of jobs)! That would more than pay for the $406.5 billion cost of the challenged F-35 fighter jet!
What if we don’t make the investment in our roads? The average American spends over 40 hours a year stuck in traffic. That accounts for $121 billion in lost time, each and every year. Most estimates tell us that over the next 30 years, drivers can expect to spend an additional 60% of their time in traffic due to failing roadway systems and increased traffic congestion due to population growth! Do you really want to spend 64 hours a year stuck in traffic? Also, with the average American earning $27.63 an hour (depending on your source it can be as low as $24.57), that’s $1,105.20 per year in lost wage time today with an estimated increase to $1,768.21 a year in lost wage time by 2045!
Recently, the U.S. Department of Transportation announced its “Infrastructure for Rebuilding America (INFRA)” grants program; a $1.5 billion discretionary grant program to help rebuild America’s crumbling infrastructure. No, that’s not a typo that is off by two decimal places; they are only investing an additional $1.5 billion in our roadways.
If that number seems tiny to you, that’s because it is. A $1.5 billion investment in our roadways is less than 1% of the amount that is estimated to be needed today for our roads, and it’s only going to get worse. As needed maintenance is neglected on an additional 527,000 bridges in our roadway system, the costs are only going to go up.
Is it time the Fed raised the gas tax so they can fix our roads properly? Currently, the Federal tax for a gallon of gas is just a mere $0.184 per gallon and was last raised by $0.03 cents in 1993. That’s nearly a quarter of a century since the last increase! Just using standard inflation, the tax should be around $0.26 per gallon today. Is a quarter of dollar really too much? Some people think the tax rate should be much higher than that; around 75 cents per gallon. In that way, real long-term improvements, such as Double Crossover Merging Interchange (DCMI) systems, can be implemented on a wide-scale.
Before you go getting all upset about taxes, I am no fan of them either. But I am a fan of good roadways, and if improving the roads will reduce the time I spend in traffic, I might just be willing to kick a little more in to make it happen.
Take a moment to consider that the average American buys around 601.5 gallons of gas per year. If you’re already losing $1,105.20 a year due to time stuck in traffic, it means that you’re in essence already paying a $1.84 tax per gallon due to poor roadways! Our current gas tax is so off the mark that it is costing you more money in the long run.
If raising the gas tax from 18.4 cents to 26 cents (or even higher) will reduce the time spent in traffic and cut our $1.84 hidden fee, then I am all in. I don’t know what the magic number needs to be folks, as I am no economist. But I do know that the gas tax needs to be set high enough that it ultimately saves me more money than it costs me. And for goodness sake, have the annual tax rate automatically increase with inflation every year, so that we don’t have to see some massive jump every 25 years when congress finally gets around to doing its job.
The gas tax (and diesel fuel, etc.) raises approximately $35 billion a year in revenue, with only 60% of that going to road maintenance and improvement. So, if the Fed is only spending $21 billion a year on our roads, and we need to spend an additional $237 billion in the next decade to get ourselves back in shape… well, I’ll let you do that math.
No matter where you stand on the gas tax, pro or against. It’s clear that something is going to have to happen, because sooner or later our crumbling roadways and bridges are going to force us to do something about it!
What do you think Nation? Is it time that we all chipped in a little more for the sake of our roads? Have we had enough potholes and traffic delays?
Keep driving my friends!
My thanks to Jeff and Larry for all their help with this article.