The following editorial appears on Bloomberg View:
Happy summer vacation, Congress. Clearly, you need a break.
The Republican-led House was so exhausted from passing legislation allowing it to sue President Barack Obama for overstepping his executive authority that it could barely muster the energy to use its own authority to address the humanitarian crisis at the Mexican border, which it did in a meaningless vote after the Senate had recessed for August.
All this exhaustion has left Americans exasperated. Has any Congress ever produced so much drama and so little legislation? It’s unlikely its productivity will improve when members return from their August recess, not least because Congress is in session only a few days between then and Election Day. Eventually it will have to do some real work – approving a federal budget, say – but that may have to wait for a lame-duck session in November.
In the meantime, there’s what it did (and didn’t do) last week. Congress’s failure on immigration has been well-documented. Less heralded, but equally impressive, was its cowardice on the Highway Trust Fund.
Rather than adopt a multi-year spending plan to upgrade the nation’s aging roads, bridges and mass-transit networks, or the Senate’s patch to keep the highway fund solvent through November, Congress passed a 10-month extension financed largely by a fiscal gimmick. It’s the worst possible outcome.
In recent years, Congress has passed 11 short-term patches to keep the fund solvent. The fund kept running dry because its major revenue source – an 18.4-cents-a-gallon gas tax adopted in 1993 – has been devalued by inflation and improvements in fuel efficiency.
In April, Obama sent Congress a four-year, $302 billion plan to upgrade the nation’s transportation infrastructure. To pay for the plan, he proposed raising revenue through changes to the corporate tax code. Both ideas landed in Congress with a thud, and both houses sat on their hands as the July 31 deadline for action approached. After July 31, payments to states would have slowed down, which would have delayed some construction projects if states and localities – which provide three of every four transportation dollars – didn’t cover the spread.
That would have been unfortunate. More unfortunate still is Congress’s solution.
By extending the fund until May 2015, Congress has bypassed the best hope for raising revenue: the lame-duck session after the November elections. Any hope of raising the gas tax, the most sensible way to pay for transportation expenses, is now all but dead. And the prospect for other politically fraught steps – such as raising user fees on roads – also took a major dive.
Making matters worse, Congress is paying for the 10-month extension with an accounting trick called “pension smoothing,” which produces more taxable income over the short run and less over the long run. Today’s windfall is tomorrow’s shortfall. So much for investing in the future.
The Senate could easily have decided to stay in session and negotiate with the House for a more responsible plan. Instead, fearful that they would be blamed for any delays in funding, senators quickly approved the House’s plan and left town. Life is all about setting priorities, after all. And what could be more important than summer vacation?