Column: Taxes and the Interstate 35W bridge collapse

Published 12:00 am Thursday, August 23, 2007

By Mitch Pearlstein, Guest Column

Several critics over the last two weeks have made the case for at least a dotted-line connection between the terrible collapse of the Interstate 35W bridge and the determination of Gov. Tim Pawlenty and his allies not to raise state taxes over the last five years. But for any connection to hold, at least one of the following conditions would have to be true, when not a single one is.

It would have to be demonstrated, for instance, that decisions by the Minnesota Department of Transportation about what to do about the bridge &8212; whether to repair it, how to repair it, when to repair it &8212; were made on the basis of what such steps might cost. But I know of no evidence that money played any role in determining what state officials or anyone else did or didn&8217;t do in maintaining the bridge.

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Likewise, to draw any suspect connection between the collapse and the consistent preference of large numbers of Minnesotans to hold the line on taxes, one would have to assume that inspectors and other officials charged with protecting and serving allowed anything other than their professionalism to determine how they gauged the sturdiness and fragility of the state&8217;s infrastructure. Without a morsel of evidence that any of them compromised their integrity, it&8217;s slanderous to imply that any of them did.

And then, of course, even if Pawlenty broke his no-tax pledge 20 minutes after taking office in 2003, and even if MnDOT&8217;s budget doubled in a single bound, does anyone really believe that federal, state and local bureaucracies would have moved fast enough so that anything other than maybe talking about a new 35W bridge would have happened by now?

But none of this speaks to the future and whether Minnesota and the rest of the nation can in fact take care of their transportation and infrastructure responsibilities without increasing taxes. Bluntly put, it doesn&8217;t address whether such a course, while clearly popular (polls show that strong majorities of Americans don&8217;t want to raise taxes for the purpose), is politically tenable in practical fact.

Conservatives, and not just them, who claim that new taxes are not necessary generally take one or more of three main tacks.

The most frequent is that transportation dollars are spent disproportionately on nice but nonessential projects, and if we got our priorities straight, enough money would be freed to adequately build what we really need and maintain what we have.

Probably the most routinely cited example of such skewing is with the way Congress has increasingly allocated transportation dollars by means of parochial earmarks, pitched by individual members for projects in their districts. A more transparent and traditional method of determining how federal transportation funds are spent, goes the plausible argument, would release billions of dollars for more-critical projects. A comment by Sen. Charles Schumer, a New York Democrat, about how transportation earmarks are &8220;almost always for new construction and not maintenance&8221; reinforces the point.

Opponents of new taxes also find it impossible to believe that a state, any state, can&8217;t rearrange its priorities so that sufficient extra dollars are found for roads and bridges. Transportation funding in Minnesota, for example, comes from a variety of sources, including gas taxes, motor vehicle sales taxes and the federal government. A relatively modest amount of money (separate from the streams just mentioned) is also included in the state’s general fund.

How relatively modest is this sum? For the 2008-09 biennium, it constitutes but 0.7 percent of the general fund. It represents only a fraction of what the state spends on transportation overall. Still, it comes to $249 million over the next two years, not exactly a trivial amount.

Question: Wouldn&8217;t it be fair to assume that doubling this proportion, to what still would be a tiny 1.4 percent of the general-fund budget, should be eminently doable in the next biennium, especially given what promise to be ongoing fears? Yes, it would seem to be a perfectly doable way of raising an additional quarter of a billion dollars, or thereabouts, for the next two-year cycle. But when was the last time it was easy to increase one portion of the state&8217;s budget by taking so much out of other parts?

And third, some people argue that we could do a better job, and do so without raising taxes, by taking greater advantage of markets.

For example, Robert Poole of the California-based Reason Foundation has written about how Texas, Virginia and other &8220;fast-growing states&8221; have demonstrated the efficacy of private companies competing for long-term contracts to &8220;design, finance, build, operate and maintain major highways and bridges.&8221; In return, they recoup their investments by charging tolls.

I&8217;m convinced that if done properly, such public-private partnerships would work terrifically. But I also realize how the very notion of privately owned roads and bridges, not to mention tolls, is anathema to enormous numbers of voting citizens. Similarly, and as teased, I recognize how getting Congress to constrain itself is problematic (though it does seem to be making progress on earmarks). And it&8217;s clear that while subtracting a quarter of billion dollars from other Minnesota constituencies may not be the hardest political job in the world, it may be close.

Which leaves us where? While those who are intent on raising taxes would face a rough road, and properly so, their opponents &8212; surprisingly, perhaps, and to my regret &8212; may find themselves on a no less hazardous one politically. But if ever there was a time to rethink priorities, try new methods, stay within our means and change political equations, how can it be other than now?

Mitchell B. Pearlstein is founder and president of Center of the American Experiment, a conservative think tank in Minneapolis.