Raise gasoline tax by 10 cents, Congress urged

Federal panel: Revenue for roads, bridges declines as motorists drive less

A federal commission is calling for an increase in the federal fuel tax to raise more money for maintaining roads. View related photos

David J. Phillip / AP file WASHINGTON - Motorists are driving less and buying less gasoline, which means fuel taxes aren't raising enough money to keep pace with the cost of road, bridge and transit programs. That has the federal commission that oversees financing for transportation talking about increasing the federal fuel tax. A 50 percent increase in gasoline and diesel fuel taxes is being urged by the commission to finance highway construction and repair until the government devises another way for motorists to pay for using public roads. The National Commission on Surface Transportation Infrastructure Financing, a 15-member panel created by Congress, is the second group in a year to call for increasing the current 18.4 cents a gallon federal tax on gasoline and the 24.4 cents a gallon tax on diesel. State fuel taxes vary from state to state. In a report expected in late January, members of the infrastructure financing commission say they will urge Congress to raise the gas tax by 10 cents a gallon and the diesel tax by 12 cents to 15 cents a gallon. At the same time, the commission will recommend tying the fuel tax rates to inflation. The commission will also recommend that states raise their fuel taxes and make greater use of toll roads and fees for rush-hour driving. Deteriorating roads Although the cost of gasoline has dropped dramatically in recent months, such tax increases could be politically treacherous for Democratic leaders in Congress. A gas tax hike was one of the reasons they lost control of the House and Senate in the 1994 elections. President-elect Barack Obama has expressed concern about raising fuel taxes in the current economic climate. But commission members said the government must find more road and bridge building money somewhere. "I'm not excited about a gas tax increase, but the reality is our current gas tax doesn't pay for upkeep of the system we have now," said Adrian Moore, vice president of the Reason Foundation, a libertarian think tank in Los Angeles, and a member of the highway revenue commission. "We can either let the roads go to hell or we can pay more." The dilemma for Congress is that highway and transit programs are dependent for revenue on fuel taxes that are not sustainable. Many Americans are driving less and switching to more fuel-efficient cars and trucks, and a shift to new fuels and technologies like plug-in hybrid electric cars will further erode gasoline sales. According to a draft of the financing commission's recommendations, the nation needs to move to a new system that taxes motorists according to how much they use roads. "Most if not all of the commissioners have a strong belief and commitment that we need a fundamental transformation of the current system," said commission chairman Robert Atkinson, president of the Information Technology and Innovation Foundation, a technology policy think tank in Washington. Revenue gap A study by the Transportation Research Board of the National Academies estimated that the annual gap between revenues and the investment needed to improve highway and transit systems was about $105 billion in 2007, and will increase to $134 billion in 2017 under current trends. Projected shortfalls in revenue led the National Surface Transportation Policy and Revenue Study Commission, in a report issued in January 2008, to call for an increase of as much as 40 cents a gallon in the gas tax, phased in over five years. Charles Whittington, chairman of the American Trucking Associations, which supports a fuel tax increase as long as the money goes to highway projects, said Congress may decide to disguise a fuel tax hike as a surcharge to combat climate change. Transportation is responsible for about a third of all U.S. carbon emissions created by burning fossil fuels. Traffic congestion wastes an estimated 2.9 billion gallons of fuel a year. Less congestion would reduce greenhouse gases and dependence on foreign oil. "Instead of calling it a gas tax, call it a carbon tax," Whittington said. Bottlenecks around the nation cost the trucking industry about 243 million lost truck hours and about $7.8 billion per year, according to the commission. Copyright 2008 The Associated Press. Original here

Federal Government Sued by California over Gutting of Endangered Species Act

by Derek

On Tuesday, California Attorney General Jerry Brown charged the federal government with illegally gutting provisions of the Endangered Species Act that call for scientific review of decisions threatening the habitat of endangered species.

“The Bush Administration is seeking to gut the Endangered Species Act on its way out the door. This is an audacious attempt to circumvent a time-tested statute that for 35 years has required scientific review of proposed federal agency decisions that affect wildlife.”- Attorney General Brown

The rule changes will allow federal agencies to decide if their actions put wildlife at risk, getting rid of the previous requirement of conducting scientific reviews determining if their actions might be detrimental to endangered or threatened species. The Department of Interior maintains that they can make good decisions themselves without scientist’s input.

“The Department of Interior is ignoring the vast majority of the over 200,000 comments they got on this rule change-by moving forward. They are basically saying public be damned.” - Andrew Wetzler, Director, NRDC Endangered Species program

The administration’s push for “midnight regulation” changes has been denounced by several environmental groups, and now the state of California has decided to file a suit challenging those regulations and calling them “illegal”. The attorney general’s office says they went forward with the suit because “it has both the legal right and the moral responsibility to protect California’s environment and resources.” They state that the new rules will threaten endangered wildlife in California and end up costing the state far more for the protection of plants and animals on the list.

According to the lawsuit filed in Northern California Federal District Court, the Bush administration has violated the Endangered Species Act by:

• Adopting regulations that are inconsistent with that statute.
• Failing to consider the environmental ramifications of the proposed new regulations.
• Not adequately considering public comments submitted by the Attorney General and many other organizations and concerned citizens.

My view? I’ve completely lost faith in the ability of bureaucracy and federal oversight to protect our most valuable heritage: our natural landscape and the plants and animals inhabiting it. Once it’s gone, it’s gone forever.

Why is it that a “lame duck” leaving office (forever) can push through last minute rule changes that his successor has to either enforce or overturn, wasting valuable time and money?

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Your request is being processed... Now Where'd I Put That $700 Billion?

WASHINGTON — Government officials overseeing a $700 billion bailout have acknowledged difficulties tracking the money and assessing the program's effectiveness.

The information was contained in a document, released Wednesday, of a Dec. 10 meeting of the Financial Stability Oversight Board. The panel, headed by Federal Reserve Chairman Ben Bernanke, includes Treasury Secretary Henry Paulson and Securities and Exchange Commission chief Christopher Cox.

While offering no details, the document also mentioned that officials at that meeting discussed "potential methods" of using the bailout program to help curb home foreclosures and ease problems in the housing market.

More broadly, the officials discussed "the difficulty of isolating the effects" of the bailout program "given the variety of policy actions taken by the U.S. government to support financial stability and promote economic growth."

The officials also noted the "difficulties associated with monitoring the use of specific funds" provided to individual financial institutions, according to the document.

The bailout program, created Oct. 3, is designed to break through a debilitating credit clog and spur financial markets to operate more normally again. Credit and financial woes _ along with a severe housing crisis _ have plunged the economy into a painful recession.

Separately, Treasury said Wednesday it will decide on a case-by-case basis whether other companies connected to the struggling automotive industry should be provided emergency aid from the bailout pool.

President George W. Bush reversed course on Dec. 19 and announced a $17.4 billion rescue package for teetering auto giants, General Motors Corp. and Chrysler LLC, which were burning through cash and bleeding jobs.

The government earlier this week provided $5 billion in aid to GMAC Financial Services, GM's troubled financing arm, and said it would lend GM up to $1 billion.

In deciding whether to aid others, the department said it will consider "the importance of the institution to production by, or financing of, the American automotive industry," and whether a major disruption of the companies' operations would likely hurt employment and the national economy.

In another report responding to questions from the top congressional watchdog overseeing the bailout, the Treasury Department defended its management of the program amid criticisms about confusing shifts in strategy.

Paulson's decision to focus the program on providing banks and other companies with capital injections _ rather than the original strategy of buying rotten assets from banks_ was necessary to respond to quickly changing financial market conditions, according to the new Treasury report.

Harvard law professor Elizabeth Warren, the chairwoman of a congressional oversight panel, has said she didn't understand why it's taken so long for the Bush administration to explain its plan. The five-member panel _ made up of three Democratic appointees, including Warren, and two Republicans _ has criticized Treasury for not saying exactly what problems they're trying to fix or how the investments will fix them.

The department insists the program is helping to stabilize the financial system, but acknowledges it will take time for conditions to return to normal.

"We have made significant progress, but there is no single action the federal government can take to end the financial market turmoil and the economic downturn," the report said. "We are confident we are pursuing the right strategy."

Both Democrat and Republican lawmakers on Capitol Hill have complained that Paulson has sent confusing signals to taxpayers and Wall Street investors by shifting strategy and not communicating clearly about objectives.

The oversight panel is one of several entities monitoring the bailout, in addition to a special inspector general and the Government Accountability Office, a congressional auditor.

Earlier this month, the GAO said the government must toughen its monitoring of the bailout program to better keep track of how the money is used.

The government has pledged to provide $250 billion to banks in return for partial ownership. The goal is for banks to use the money to boost lending. However, a recent review by The Associated Press found that after receiving billions in aid from U.S. taxpayers, the nation's largest banks can't say exactly how they're spending the money. Some wouldn't even talk about it.

The idea behind the capital injection program is for banks to use the money to rebuild reserves and lend more freely to customers. However, banks do have leeway to use the money for other things, such as buying other banks, paying dividends to investors or bonuses to executives. That's touched a nerve with some lawmakers and other critics.

Money from the bailout pot also has been used for other things, including throwing a financial lifeline to ailing auto companies, and teetering insurance giant American International Group. Money also was used to back a rescue for Citigroup Inc.

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