Dec 8, 2014
Governor Snyder of Michigan recently stood near a big hole in the freeway and asked state legislators to pass a fuel tax increase. He said new revenue would be used to fund more than a billion dollars in road repairs.
What he “forgot” to mention was how big road holes grew out of big budget holes the governor dug in 2011. That was when roughly 1.8 billion dollars a year in business tax cuts were pushed through.
In order to fix the roads, politicians of both parties propose to make the population pay. Two different ways of doing that are being debated.
One plan promises not to raise taxes. This plan would snatch gasoline sales tax money away from schools and local government and transfer that revenue to roads.
Under this plan, by 2020, the school aide fund and local government are projected to lose almost one billion dollars annually – yet another budget hole! A former head of the Michigan House Fiscal Agency said: “It’s just a shift from one hand to the other.”
The other plan, backed by the governor, raises gasoline prices. This could make Michigan the state with the highest fuel taxes in the nation. Workers, who must pay at the pump to get to and from their jobs, would be hit hard.
Of course the roads need to be fixed! But instead of politicians holding crumbling roads hostage to strong arm a false choice between more taxes or more cuts, there is another answer. All that construction could be paid for – with room to spare – if corporations and the wealthy were not given a free ride.