by James J. Baxter, President, NMA - National Motorists Association

5NATIONAL MOTORISTS ASSOCIATION FOUNDATION NEWSBut The Trust Fund Was Just Sitting There!By Aarne FrobomThe phrase "trust fund" has acomforting sound, but motoristsshould be uncomfortable aboutwhat's happened to the Highway TrustFund. This is the fund created in 1956to receive fuel-tax revenues and payfor federal-aid roads, including thenew Interstate system, and it wasintended to be used only for roads. Butthe Trust Fund kept faith withmotorists for less than two decades.Beginning in the Nixonadministration, the Trust Fund wasrolled into the "unified federal budget."While still usable only for roads, therate of Trust Fund spending began tobe depressed to make the overalldeficit look smaller. Large unspentbalances were carried throughout the1970's and 1980's. In 1983, the MassTransit Account was carved out of theTrust Fund, diverting road-user fees topublic transit.Road construction enjoyed a smallrenaissance following the 1997highway bill. For the first time indecades, Trust Fund spending actuallykept up with gas tax revenues. Roadand transit spending exceeded $31billion. But when the surplus evaporatedin 2001, the boom came to ahalt. When confronted with unexpecteddeficits, Congress and theBush administration reverted tochoking off road spending and usingthe Trust Fund balance to offsetGeneral Fund spending.Big bites have been taken out ofhighway funds. Of the 18.4 cents youpay in federal taxes on every gallon ofgas, 2.83 cents goes to big-city transitsystems, almost a sixth of the total. Abillion and a half a year is siphonedinto the ethanol subsidy, and thatamount is going up. Small fractions ofhighway aid are used for HOV (HighOccupancy Vehicle) lanes, parks, biketrails, old-building preservation, andeven anti-auto "smart growth"programs. These diversions growlarger every time Congress touches thehighway law.The federal highway program isreauthorized every five or six years,with new rules for divvying up thepie. Every year, Congress passes abudget for the US Department ofTransportation. Each of these events isan opportunity for pork barrelspending at the expense of highwaysgenerally. And at every one of theseopportunities in recent years, Congresshas set new records for spendinghighway funds on things other thanhighways. In the 2003 budget,Congress did away with"discretionary" funds that states canLike a warship or fort without aircover, the Trust Fund has turned froma valuable asset into a sitting-ducktarget, ripe for attack from all sides.apply to the US DOT for, and thenspent the whole discretionary categoryon pork barrel jobs in the states ofinfluential committee members.Will the U.S. federal highwaysystem collapse under assault fromCongress? Not immediately, but fundsare shrinking to the point where newcapacity to cope with traffic growthwon't be affordable. Non-highwayinterests could filch so much that theTrust Fund will no longer be of valueto some states.Like a warship or fort without aircover, the Trust Fund has turned froma valuable asset into a sitting-ducktarget, ripe for attack from all sides.Where it once united the country withhigh-speed highways, the Trust Fundcould become a means for flushingmoney away from auto-using statesinto transit-dependent areas, and awayfrom roads into other programs. Statesthat want road improvements could beforced to tax their own motoristsheavily to replace road money thatgoes to Washington and doesn't comeback.Is anyone defending the TrustFund? We'll see. The big cut in thehighway funds for 2003 was a wakeupcall for the highway system'sfriends, and a bill has been introducedto reverse the spending cut. This year'sContinued on page 13The Eisenhower SystemWhat Would Ike Say?In case you haven't noticed the5-star signs along freewayroadsides, the Interstate Systemhas been renamed the EisenhowerSystem of Interstate and DefenseHighways. This is to commemoratethe building of the systemstarting with the passage of theTrust Fund during DwightEisenhower's first term in 1956. Inpopular folklore, Ike became anenthusiast for freeway constructionby observing the autobahns inoccupied Germany after 1945.Actually, the Interstate Systemwas authorized in 1944, whenIke was occupied in Normandy.Some political history suggeststhat the President had to be soldon the concept of the Interstates,at first believing them to be aboondoggle, and unconvincedof the need for a new federal tax.Eventually, freeways becamethe enduring symbol of theEisenhower presidency. But whatwould the General say if he knewthat the Trust Fund, of which hewas initially suspicious, wasfinancing the Boston harbortunnel and the Los Angelessubway?MARCH/APRIL 2002