Wednesday, March 20, 2013

Transportation and the Law of Unintended Consequences

Recently, a group of more than 40 mayors — including Seattle Mayor Mike McGinn and Marilyn Strickland of Tacoma, sent a letter to Governor Jay Inslee and to legislative leaders urging them to pass an 8-cent gas tax increase, claiming more than $3 billion is needed to maintain roadways and bridges over the next 10 years.

Meanwhile, House Transportation Committee Chair Judy Clibborn (D-Mercer Island) will seek a 10-cent-per-gallon gas tax increase, although at 37.5 cents per gallon, ours is already among the highest in the nation. The proposed hike will reportedly be a part of a much larger transportation revenue package.

I’ve had some past dealings with Clibborn, and have found her to be a pragmatic, moderate, business-friendly Democrat for the most part, so I was somewhat surprised to see her bring this forward.

Senate Majority Leader Rodney Tom (D-Medina), said last month he would support a gas-tax hike, however, any increase will face stiff resistance in the Senate, which is controlled by Republicans — and two Democrats — Tom, and Tim Sheldon (D-Potlatch).

What’s so ironic about these recent proposals is that they are the direct result of the Law of Unintended Consequences at work.

Congress mandated our cars will get better gas mileage via what’s known as the CAFE Standards. Being good stewards of the earth, literally hundreds of thousands of people bought high gas mileage hybrid cars. Wanting to do the right thing for our environment, they voluntarily paid an extra multi-thousand dollar premium for them — which generated a substantial about of additional, one-time sales tax revenue. That money went into the general fund — not the gas tax fund.

The unintended consequence is the combination of hybrids, and higher gas mileage cars complying with the CAFÉ Standards, reduce the amount of fuel being bought on an ongoing basis, which reduces the amount of gas tax dollars collected, hence the shortage of revenue to maintain and build roads, fund the ferries, etc.

Still more unintended consequences of the move by the ruling class elite to get us out of our cars and on to mass transit, is that fewer cars will be bought. New and used car sales are the single largest generator of sales tax revenue for our cities and counties. Reducing the amount of car sales will negatively impact not only the state’s general fund, which will increase the deficits we’ve gotten used to facing, but also reduce gas tax revenues even more. Meanwhile, cities, counties, and the state itself, will still require money to maintain their existing roads. Where will those dollars come from?

And then there are the increased tax subsidies that will be required to operate mass transit, since fare box revenue doesn’t even come close to meeting operating costs, maintenance, etc. The ferries are a perfect example.

Higher gas taxes — as well as increasing other taxes — will also take money directly out of the economy that would otherwise be spent on things that generate the sales tax revenue that our cities and counties run on — another unintended consequence.

But if all else fails, the Puget Sound Regional Council has a plan. Its Transportation 2040 Plan ( recommends imposing a Vehicle Miles Driven Tax (VMT) - taxing you for EVERY mile you drive. This is in addition to tolling I-5, I-90, I-405, and I-82, as well as adding HOT Lanes (Read: Toll) to many state highways, including Highways 3 and 16 - just as they’ve already done on Highway 167. They’re not proposing to build new lanes, just make you pay to drive in the ones you’ve already bought and paid for.

Isn’t anyone actually thinking through the unintended consequences of things like the CAFE Standards and mass transit before their knee-jerk cave-in to the politically correct elite and their vision of transportation Utopia?

The fly in the ointment for a gas or VMD tax to be passed into law, is it will require either a two-thirds majority in both the House and the Senate, or a vote of the people.

Thank you Tim Eyman.