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<p>[quote user="dakotafred"]</p> <p> <blockquote> <div><img src="/TRCCS/Themes/trc/images/icon-quote.gif" /> <strong>Sam1:</strong></div> <div></div> <p> <blockquote> <div><img src="/TRCCS/Themes/trc/images/icon-quote.gif" /> <strong>dakotafred:</strong></div> <div></div> <p><span style="font-size:small;">Surely you will acknowledge, Sam, that such roads are an exception to the rule of public financing.</span></p> <div style="clear:both;"></div> <p> </p> </blockquote> </p> <p>They are an exception.  But they are also an example of how roads can be funded and paid for by the users without indirect subsidies from the general taxpayers.  Equally important, the users know up front what it costs them to drive on the toll roads mentioned. The cost is not hidden.</p> <div style="clear:both;"></div> <p> </p> </blockquote> </p> <p><span style="font-size:small;">However, most highways -- and almost all the city and county streets and roads that tie into them -- will continue to be publicly underwritten. That is the model, not Sam's. Same with the vast infrastructure supporting our air system.</span></p> <p><span style="font-size:small;">I agree with posters who say an open Uncle Sam checkbook for roads and air does not justify the same for passenger rail. There is the legitimate question of efficiency and value received. Also -- and this is the biggie -- the American public is solidly behind highways and air. The same cannot be demonstrated as yet for passenger rail, outside the NE corridor and maybe a couple of other places.</span></p> <p><span style="font-size:small;">What I'm getting at is that perhaps the passenger rail many of us believe in -- operating subsidy and all -- will just have to await that public demand. Then, if history is any guide, Uncle Sam's checkbook will be no problem.</span></p> <p><span style="font-size:small;">Same with state taxpayer money. In North Carolina, is $12 million a year worth it to people -- or not? I will say the projection of no subsidy, if the improvements and expansion of service are realized, is something only a child (or someone with something to sell) could believe in. </span>[/quote]</p> <p>The federal highway system, as well as most state highways, are funded by user fees, usually in the form of fuel taxes, license fees, excise taxes, etc.  However, as I have said, because the Congress has failed to raise the fuel taxes to keep pace with inflation and population growth, monies have been transferred from the general fund(s) to the highway funds.  Most motorists pay taxes, which flow into the general fund(s), from which a small portion of the receipts, which are paid by motorists (most Americans drive), are transferred to the highway funds.  </p> <p>Interestingly, the amount of money transferred from the federal general fund to the highway trust fund has been approximately the same as the amount of money transferred from fuel taxes to the Mass Transit Fund and the U.S. Treasury Department.  However, 2010 was an exception, when nearly $14 billion was transferred from the general fund to the highway trust fund.   In other words, motorists have been subsidizing mass transit and making a payment on the national debt through their fuel taxes. </p> <p>City streets and county roads are funded with property taxes.  Again, most motorists pay these taxes, so in effect they are paying for the streets and roads that they use.  However, upper income motorists pay more in property taxes than lower income folks, thereby in effect subsidizing lower income drivers.</p> <p>It is not $12 million per year.  It is $12 million per year compounded to infinity.  Moreover, the anaylists fail to mention the financing costs associated with the $12 million.  Equally important, they fail to mention the cost of upgrading the infrastructure, as well as the financing costs embedded in the capital costs.  </p> <p>Contrary to what several people have wrongly concluded from my remarks, it is appropriate for the government to fund transport infrastructure if there is a reasonable probability that the users will pay for it through the fare box or from user fees.  This, by the way, has been the underlying premise for most federal funding of transport infrastructure in the United States.  </p> <p>The federal government under wrote the funding of the transcontinental railroads on the premise that it would recoup the investment through taxes and fees.  It got its money back and then some.  The question facing the proponents of expanded passenger rail is whether the government (we the people) will get our money back.  Experience over the past 50 years is not on their side.  If the answer is not likely, then I don't think that it is a good investment.  And I don't support it.</p> <p>It may be childish to believe that the users should pay for the services that they want.  The contrary view, however, that we must subsidize the users is one of the mind sets that has led  us to the huge national and state debts facing we the people. </p>
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