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Interstate 2.0

Why fiscal conservatives should support rebuilding America’s federal highway system

Mar 7, 2011, Vol. 16, No. 24 • By ROBERT W. POOLE JR.
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Congress expanded the federal program in 1944, by that point not bothering to cite a constitutional justification. But after the war, when debate turned to creating the Interstate highway system, constitutional concerns were sufficiently strong that national defense was invoked as part of the rationale (the program’s official name was the National System of Interstate and Defense Highways). The 1956 legislation also increased the federal fuel tax rate and created the Highway Trust Fund, to which all federal fuel tax receipts were credited. At that point, all the revenue from the trust fund was to be spent on highways, primarily the Interstates but also the other highways that had become part of the federal-aid system of highways. Thus, for the first time, the federal fuel tax became a users-pay/users-benefit tax, much like the original state gas taxes.

Despite Congress’s subsequent departure from the users-pay/users-benefit principle, there is a strong case for the Interstate system to remain a federal program, for three reasons. First of all, ensuring the free flow of commerce among the states and across our national borders is in the DNA of the Constitution. One of the reasons the Founders replaced the Articles of Confederation was that states were charging tariffs at their borders and impeding the flow of commerce. Between the interstate commerce clause and the post-roads provision, ample justification exists for a federal system of superhighways with common technical standards.

Second, the benefits of such a system extend beyond the borders of any state. Some portions of the Interstate system, such as the freeways serving the ports of Los Angeles and Long Beach, facilitate the flow of a large fraction of all oceangoing cargo between the United States and Asia, benefiting all Americans. But the burdens of this nationally beneficial infrastructure​—​in terms of traffic congestion, noise, and air pollution​—​are borne primarily by residents of Southern California, who reap only a fraction of the benefits. Likewise, residents of the Seattle area benefit from commerce that moves through their ports and onto Interstates that traverse the mountain West. National benefits of this kind do not arise from the numerous other programs Congress now pays for with federal highway user tax revenue: state highways, urban transit, bike paths, recreational trails, sidewalks. Those programs’ benefits are purely local, and they should be supported locally.

Third, in terms of practical politics, any move to “defederalize” the Interstates would be fiercely opposed by highway user groups, such as trucking and automobile associations. While this “highway lobby” does not have the clout it had during the original Interstate and freeway era, its influence is still a significant factor in debates on federal transportation policy.

What Fiscal Conservatives Should Support, and Why

The defining issue of our time is figuring out how to reduce the scope and cost of the federal government. In surface transportation, the federal role has grown far beyond the highly focused program to develop a national superhighway network, paid for by and benefiting its users. Every time Congress has reauthorized the program, it has expanded its scope, to the point where one-quarter of the funds are now spent on non-highway programs. And if the Obama administration has its way, the program will double in size, spending highway users’ money on endless high-speed rail boondoggles and even more transit and other non-highway purposes.

Advocates of devolution are on the right track, in that most highways, all urban transit, and certainly things like sidewalks, bikeways, and recreational trails are the province of state and local government, not Washington. Without the lure of “free federal money,” states and cities will have much greater incentive to make cost-effective choices (flexible bus rapid transit rather than costly and inflexible light rail systems, for instance). In addition, their own dollars, unencumbered by costly federal mandates, will go 20 to 30 percent further than federal dollars.

The Interstate system is different, in that its benefits are truly national in scope. It can and should be paid for solely by its users, thereby having no net effect on the federal budget deficit. But devolving the rest of the current federal surface transportation program to the states would have a modestly positive impact on the deficit, especially to the extent that in the last three years almost $35 billion in federal general-fund money has been added to what the federal user taxes bring in, to support the bloated scope of the current program.

But the Interstate system is wearing out, much of its design is obsolete, and it is woefully short of the capacity needed to support projected population and economic growth in coming decades. Hence, it makes sense to re-focus the federal program on a second-generation Interstate system for the 21st century: Interstate 2.0. Much of the cost of this program will go for reconstruction and widening, as well as replacing obsolete interchanges conducive to bottlenecks. But the map also needs to be redrawn, reflecting where economic activity takes place today and tomorrow, not where it was in the 1940s. That will involve upgrading a number of highways in what is now called the National Highway System to full Interstate standards.

There’s an old adage in politics that “you can’t fight something with nothing.” Fiscal conservatives rightly oppose the administration’s high-speed rail and “livability” programs as boondoggles. But instead of just being the party of “no,” fiscal conservatives need something bold and meaningful to be for. Interstate 2.0 should be that alternative. And by restoring the Highway Trust Fund to the original concept, conservatives can also rebuild the trust of the voting public.

Robert W. Poole Jr. is director of transportation policy at the Reason Foundation.

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