2014 US Trucking News – ATA Challenges President Obama’s Transportation Programs
United States President Barack Obama has once again emphasized the importance of the role of transportation, as well as transportation infrastructure as a main driver of the United States economy, as well as the global competitiveness of the country, during his State of the Union Address.
Early into his speech, President Obama brought up the point of how the nation’s corporate tax code is filled with loopholes that punish businesses which invest in the US, and reward those companies that keep their profits abroad. He wants these loopholes to end, coupled with ending encouragement to move these jobs abroad, and, instead, lower the rates of taxes for businesses which create domestic jobs.
President Obama also says that they are able to take the money that they save from this change to tax reform, to making jobs that rebuild roads, upgrade ports, unclog their commutes, since in the economy today, first-class jobs settle to first-class infrastructure. The President says that Congress is needed to protect more than 3 billion jobs by completing transportation and waterway bills during the summer.
The bills that the president has cited are the current surface transportation reauthorization MAP-21, which would be expiring at the end of September. The other bill is the Water Resources and Development Act (WRDA), which has not even been signed into law since 2007.
The House and the Congress both accepted their very own versions of WRDA last year, through which the Congress also authorized the US Army Corps of Engineers to carry out their plans to develop, maintain, and give support to the US’ needs regarding vital port and waterways infrastructure, as well as support efficient and targeted needs in flood protection and the restoration of the environment.
With the upcoming expiration of MAP-21, paired with the current funding issues that are related to the Highway Trust Fund, this leaves the present dilemma without a predictable result in sight, since transportation infrastructure is not even being maintained and improved properly. Industry experts claim that without immediate action, the situation will become worse as the years go by.
There were mixed reactions to the president’s speech from industry stakeholders.
The Executive Director of the Washington, DC-based Coalition for America’s Gateways and Trade Corridors, Leslie Blakey, said that the issues regarding transportation were mentioned early on, could be seen to an extent as an order of importance for both the Congress, and the White House.
Blakey says that it was heartening, as well as the fact that the president mentioned MAP-21 and WRDA, since whenever transportation is brought up, it is sometimes very broad-based and does not relate to legislation in the Congress. It shows that Congress needs to get the WRDA bill out of conference, and focus on MAP-21, so it could reach the president’s desk before it expires.
Blakey also noted that President Obama is the first president, since President Eisenhower, to even discuss about transportation in these speeches, and he has already done so every year. She added that this has even become a recurring theme for him.
However, Blakey also noted that he failed to talk about funding for these different proposals.
Blakey says that President Obama continuously refers to transportation as an investment, and has a connection with their capability to keep their status in the global economy, and as a powerhouse of growth and innovation. She says that transportation is not just about spending, it is also about investing. Blakey thinks that the president’s message regarding railroads, roads, airports and ports shows that he will resume pressing on his agencies to build the importance of multimodal investments regarding transportation.
Joshua Schank, President and CEO of the Eno Center for Transportation, says that transportation has become, once again, a huge component of the State of the Union address, but he warns that with that also comes a degree of disbelief, since none of that address has translated into more significant action over the last five years since President Obama assumed into office.
Just like Blakey, Schank also says that it was quite positive that he mentioned WRDA and MAP-21 as keys to expanding the US’ transport system and giving attention to Congress, passing these bills would be a boost for supply chains in America.
Schank says that he will not get too excited about it. He questions about what President Obama is going to do, in order to push that legislation through and to what extent is he able to do anything, especially given his approval ratings. MAP-21 depends wholly on looking for money to be able to fund it, and Schank does not have any idea how any closer they are to that. President Obama has also mentioned corporate tax reform as a method of funding infrastructure in the past, and mostly mentioned it as a one-time infusion of cash, rather than a long-term sustainable strategy of investment, which is what he would imagine people who operate ports, logistics, and freight mostly care about. These people are searching for a long-term transportation investment strategy.
According to Schank, the greatest potential for funding development is looking for a way to reduce spending, and use these spending cuts to create long-term investments when it comes to transportation.
Schank says that instead of depending on just the gas tax, maybe there is another type of revenue source that isn’t really a user fee, but is also applicable to transportation, such as income tax. This is applicable to transportation, because transportation can make a considerable donation to the GDP.
Bill Graves, the president and CEO of the American Trucking Association, says that it was heartening that President Obama discussed about transportation infrastructure, but also emphasized that certain action and certainty should be done.
Graves says that while they have applauded the president for talking about the need for investment in infrastructure, they have also expressed disappointment in the lack of specificity when discussing funding. Even though it is also important to the country that the Obama administration and the Congress team up on a multiyear highway bill, they also know that until the administration gives a serious plan in regards to funding, they will risk going over the fiscal cliff of the Highway Trust Fund in the near term, and be unhappily underfunded to meet America’s needs.