The National Taxpayer’s Union is one of my favorite organizations. They’re on the front lines of fighting to keep our taxes low and reduce the size of our bloated government. They do this mostly through raising public awareness and letter writing campaigns and public promotion of tax reductions and opposition to excessive government spending. They target pork spending, support the FairTax, oppose internet taxation and advocate for taxpayers in congress and in the courts. That’s all great stuff.
Philosophically I’m a libertarian. I believe in people being free in almost every possible way and having an absolute right to control their own property, including controlling their own money without government interference or having the government seize it for their own use. That means I’m also a minarchist, because the best way to have government not take your money is to have a government which performs only truly necessary functions which cannot be done better by private citizens, thereby keeping the size and cost of government to a minimum. I hold to the maxim “that government governs best which governs least.”
There are some legitimate responsibilities of government and there are some taxes which are better than others. Government exists to do the things which individuals cannot effectively do for themselves. That includes functions like providing for the common defense of the nation, a system of law and justice and providing certain services which we all agree don’t work well when privatized, like the construction of highways, bridges and other public infrastructure. When it comes to funding government, taxes which arbitrarily take from the entire population like an income tax are the worst form of taxation, while taxes or fees which target those who make the most use of government services are more desirable. The ideal would be fee-for-service government, where you only had to pay the government for those services which you use, but realistically that type of system is hard to implement. However, whenever possible, the expense of government programs should be paid directly by those who benefit from those programs in proportion to their level of usage.
Sadly, too much of the time, our government prefers to tax citizens first and throw money at problems rather than look for more equitable and more creative solutions which would be less of a burden on the population in general. The NTU’s answer to this is to oppose all increases in taxation. It’s an understandable reaction, but they’re relentlessly unimaginative. Sometimes the righteous fight takes them in the wrong direction.
There’s a proposal under discussion in Congress – obviously driven by the I-35W bridge collapse – to add 5 cents additional tax onto each gallon of gas sold to pay for infrastructure maintenance and improvements. In response, the NTU has just issued a letter with the support of 50 different anti-tax groups, addressed to the President and Congress, strongly arguing against raising the gas tax. They point out that although this is supposed to be a temporary increase to pay for bridge repairs, similar temporary increases in the first Bush and Clinton administrations never actually went away and were eventually ‘repurposed’ away from their original use. They’ve got a good point. Passing new taxes in a panic when you haven’t been responsible with the money you’ve already taken from the taxpayers seems like the height of irresponsibility.
President Bush has come out in opposition to the gas tax increase too, and he hits on the one thing that he and I and the NTU can all agree on. There’s no good reason to keep throwing new money at the highways so long as we’re saddled with the bloated 6-year highway plan passed in 2005 which includes $25 billion in pure pork in the form of almost 6500 earmarks, including the now-legendary ‘bridge to nowhere’ in Alaska. Cutting that pork would easily raise as much additional money for highway maintenance and repair as a 5 cent hike in the federal gas tax, so the idea of cutting the pork instead of raising the tax is very appealing.
In principle I agree. By all means let’s make pork cutting our first priority. But when it comes to a gas tax there’s a larger issue in play and that’s where I have my falling out with the estimable folks at the National Taxpayer’s Union, because all they’re worrying about is cutting taxes. They’re not looking at the larger picture.
What if, rather than just cutting the pork and leaving the huge transportation budget of more than $40 billion a year sucking at the taxpayer wallet, we were to take this idea of raising the gas tax and handle it in a responsible way? Why not improve our highway funding while making taxes more equitable at the same time?
Cutting $25 billion in pork from the six-year budget would free up about $4 billion a year to improve bridge safety, about half of the $8 billion you’d get from the proposed 5 cent increase in the gas tax. What if we went a step further? We could cut the pork, and then instead of adding 5 cents to the gas tax we could add 30 cents. That would raise $45 billion over and above the $4 billion in cut pork savings. That would be enough to pay the entire yearly federal transportation budget with $9 billion additional for urgent infrastructure maintenance like bridge repairs.
More than that, it would shift the burden of transportation infrastructure costs away from the taxpayers in general and onto those who use the roads and bridges the most and consume the most gas. It would be a much more fair way to fund the federal portion of the bill for building and maintaining our basic infrastructure. To make this work the money from the higher gas tax ought to be locked into funding transportation and nothing else. There should be no possibility that it would be ‘repurposed’. Keep it out of the grubby hands of the porkmesiters. The DoT could essentially function independently, with some Congressional review. Make it entirely self-funded by the gas tax, working directly for the people, paid by the people and answerable to the people. That’s the way government ought to be done.
I’m with the NTU on reducing and eliminating taxes and cutting the government down to the bare bones. But the gas tax has the potential to be one of the most legitimate forms of taxation with the money being applied to one of the few genuinely necessary functions of government. While we should oppose the pork, it’s a distraction from the main point. We shouldn’t be against raising the gas tax just because it’s a tax. There’s an opportunity here to completely rethink how we fund government, and we shouldn’t miss it because our vision is just limited to cutting taxes.