Robert Puentes is a senior fellow at the Brookings Institute, where he works on the Metropolitan Policy Program and directs the Metropolitan Infrastructure Initiative. The Politic spoke to Puentes about Congress’ highway cliff, a 21st century gas tax, lessons from Europe and Asia on high-speed rail, and more.

The Politic: It’s good that we’re having this interview today because there is an incredibly important issue relating to infrastructure law in the news right now. Could you speak a little bit about this “highway cliff,” as it has been dubbed by some, currently confronting Congress?rpuentes3

Sure. The federal government provides about a third of the money that goes into the nation’s roads and bridges. It has done that for a while. The current law [the Highway Trust Fund] is going to expire tomorrow, on Friday, July 31st, if it is not extended. Congress cannot come to an agreement right now on the substance of the bill nor on how to fund it in the future, so it will have to pass an extension just to continue the current law. Congress also has to supplement that with some general funds since there is not enough money to authorize the spending that is in it.

The Politic: Why is it so difficult to pass infrastructure law like the Highway Trust Fund? Is it just basic partisanship or is there something unique to infrastructure law that makes it divisive?

I don’t think it’s infrastructure law broadly. Infrastructure covers so many different things, not just highways, roads, and bridges and transit, but aviation, Amtrak, freight rail, maritime related things, a lot of things that go into transport, broadband, energy, water. So, actually, infrastructure is probably an area where there is more general agreement than usual.

It’s just this particular bill that covers highways and transit that is contentious, mostly because there is not enough revenue coming in from the traditional sources to pay for highways the way Congress is accustomed. A federal gasoline tax was first passed in the 1950’s around the framework of building the interstate highway system. As Americans drove more and more on these new roads and as these roads facilitated the decentralization of cities and metropolitan areas, jobs and people moved out, people drove more, they consumed more gasoline, people paid more in the gas tax, it generated more revenue, and this produced a self-fulfilling system that just pumped more and more money in to the funding system itself. But all those trends have disappeared: Americans are not driving more. In fact, they are driving less per capita. When we do drive, we drive much more fuel-efficient cars. We know that Americans are now interested in different types of travel options – walking, biking, car share, bike share, Uber and Lyft. There are a lot of major trends changing the calculus, forcing Congress to make hard decisions on either lowering spending or finding new resources to pay for highways.

The Politic: So, what is the future of the gas tax? How do we pay for highways with the gas tax generating less and less revenue every year? Is the answer to simply raise it?

We haven’t raised the gas tax since the early 1990s even to keep pace with inflation, so the nominal value is generating less revenue than it should. There’s an understanding that it is not a sustainable source of revenue long into the future mostly because of what we think is happening to fuel efficiency. It’s very complicated, but the system isn’t priced correctly – it’s heavily, heavily subsidized through general revenue and lots of other different sources. The gas tax in the short term is the workhorse of the funding for the highway program and should be raised for sure. But there isn’t any desire to do that right now. The administration has taken it off the table. Congress has taken it off the table. Many Republicans have taken Grover Norquist’s no tax pledge. That explains why we’re in this situation right now.

The Politic: Do you think implementing a long-term highway bill, rather than just periodically renewing the Highway Trust Fund every year, is possible?

It is absolutely possible. I think we can make the gas tax not a toxic proposition for policymakers if it’s coupled with an updated vision and program that reflects the realities of the 21st century. The problem right now is that we are trying to convince policymakers to raise the gasoline tax to pore more money into what a lot of people think is a broken system. That’s a difficult proposition to make. What we need to do is throw out the existing system, which has its roots in the Eisenhower era, the interstate highway system, and develop something that truly reflects the significant changes that are underway today. Demographically, things are changing and that has impacts on people’s travel patterns. Economically, things are changing: we are much more globally oriented with things like freight having such a large role. The sharing economy, such as shared rides, is also changing how we use the system. There is an emphasis on different modes of transportation besides the automobile. An update is the kind of thing we need to galvanize Congress.

The other thing is, it’s not a coincidence that a substantial transportation bill hasn’t passed since we eliminated earmarks. That was what made the political calculus work for a lot of members of Congress. When we had earmarks, transportation bills passed with something like 90 percent of the vote. Everyone voted for transportation bills because it was specific and it was tangible and they understood the connection between the revenue being raised and the project being built. Right now it’s [the Highway Trust Fund] — just a general purpose cash transfer program without any kind of direction. So earmarks, as vilified as they are or were, might be the thing that policymakers need to make this real and tangible again.

The Politic: Switching gears a little bit, what do you think the future of high-speed rail is in the United States?

It’s strong. We are an emerging market when it comes to that kind of investment. It’s tough to say in the abstract because, like with any part of infrastructure, it really matters where you put these things and what they are designed to do. For example, high-speed rail was proposed in Ohio to connect Cleveland through Columbus down to Cincinnati. It made no sense whatsoever. It wasn’t connecting places that had any significant economic relationship. It wasn’t solving any kind of traffic or aviation problem. But there are some promising projects that are actually underway right now that are all very viable. Once we get these things built you’ll see how successful they are. This is how other countries other than China, particularly European countries but also the Japanese, develop their systems. They don’t build the whole thing at once like was proposed here. They iterate: they build a trunk line, and they make that work. They build another one and then make that work. That’s what’s emerging here. We have the California high-speed rail project that’s moving along. It’s very bumpy but it’s still moving, connecting metropolitan LA and metropolitan San Francisco to places that have clear economic relationships, they’re about the right distance, and I think it will be very competitive. We have two other private projects, one in Texas and one in Florida, between Dallas and Houston and between Orlando and Miami, that are private ventures. I think it’s a very strong market signal that you have private investors willing to spend millions of dollars in capital on operating these services – some people clearly think it’s very viable and we should pay attention to that.

The Politic: You mentioned Europe and Japan just now. When you look at Europe and Japan and see how successful and popular high-speed rail has been there, what are some lessons the US can learn from those places?

High-speed rail has got to connect places that have an economic relationship. It’s not an “if you build it, they will come” situation. It really has to fill a need that’s there. And you can look at air travel as an indication – if people are traveling by air between two places, that’s a good indication. There’s highway data, too. That has to be one thing. Also, rail has to be the right distance. What we’ve learned from Europe and a little bit from Asia here is about 400 or 500 miles seems to be about the right distance – it’s too long to drive, too short to fly. And there’s a sweet spot right there where we see that’s where the most potential for success is. And a third thing is that there has to be some sort of relationship with the aviation system and it’s going to be very difficult for the United States because there’s really no connection between air travel and rail travel in terms of planning. There’s competition there. Privately owned airlines probably look askance at some of these high-speed rail investments. So what we can learn from parts of Europe and Asia here is that it shouldn’t be either or, we should make these decisions together. If you’re going to solve an air traffic problem, maybe there’s a rail solution. If you can’t get rail built, maybe there is an aviation decision to be made then. These decisions shouldn’t be separate.

The Politic: What do you think the relationship between the federal government and state governments should be in terms of transportation and infrastructure policy?

We assume that the federal government is sitting on top of this pyramid and raining money down on states and localities but it’s truly quite flipped. The federal government only provides about a third at the most of the money that is going in to the transportation system, at least for highways and transit. So we overemphasize it in a lot of ways. The relationship would be better served more as a true partnership between the federal government, the states, the cities and the private sector and not a hierarchical one of one sitting on top of and directing the other ones because that’s not how we’re getting stuff done. It needs be a true partnership and we have to sort that out – a real federalist approach. There are things the federal government should be doing, focusing on interstate commerce, things like freight, or focusing on the global economy that are just too big in size and scope for the states. There are other things where the federal government should just get out of the way of the states and the cities and let them innovate, things that are truly local, providing the flexibility and the freedom for individual localities to make their own decisions.

The Politic: You’ve spoken before about this concept of a smart city. What is a smart city and how does one go about making a city smart?

Smart cities are places that know what they want to be. They have particular economic or social or environmental objectives and they use technology as a means to get there. The problem that we have when we talk about smart cities mostly is that we think it’s supposed to be technology led and that’s the wrong approach. It’s not really just about outfitting a technology into the built environment, that’s just the natural evolution of a traffic light into a smart traffic light. That’s not really what the true vision of a smart city is. It’s really about trying to identify what your overall objectives are, probably economic, and what your goals and aspirations are, and then identifying the role technology can play in getting you there. You have to be very deliberate about that and not just try to use a technological solution just for the sake of doing it. The public sector is generally well versed in some of this, but when it’s framed around broader goals it makes it much more clear, much more rational, and much more transparent for the private partners that usually have a big role in smart cities.

The Politic: One-quarter of the 600,000 bridges in the United States have structural problems or designs that have been supplanted by better, more modern ones. How do we fix this?

Safety has to be paramount. It’s an area where we do need the federal government to be present. It’s also an area where the states should not have to wait for the federal government to do anything. It’s an area that we have tons and tons of data and analytics on. We know very precisely the conditions of these bridges. One thing we can do, the states are doing some of this but something the federal government can do, is promote a policy of fix-it-first. The money that is coming from the federal government should really be going to fixing the existing system as a priority before constructing any new kind of capacity. I don’t think that we’re going to have bridges collapsing all over the place in the near future, but clearly we see what happens when they are fracture critical. The states have been doing a good job of addressing this. I don’t think just throwing more money at this is going to solve this, but it needs to be a priority to make sure bridges are up to the highest standards they can possibly be.

 

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