if no deal is made on the federal highway fund, it will soon plunge even further. It’s important here not to get caught up too much in the details. Yes, it’s absurd that the federal gasoline tax has been flat in nominal terms since 1993, which means that in real terms it has fallen 40 percent. But highways don’t have to be paid for with gas taxes — the fund could be (and has been) topped up with transfers from general revenue. And federal borrowing costs remain incredibly low by historical standards. So the highway issue should be seen as part of the larger craziness of infrastructure policy, in which spending has crashed at a time when by any reasonable criterion we should have been building much more.Let’s turn to New Jersey:
Despite his promise to increase pay-as-you-go financing for the Transportation Trust Fund, Gov. Chris Christie has relied so heavily on debt for four years that the program will run out of borrowing capacity a year early, leaving the Christie administration without the funding it needs to pay for highway, bridge, and mass transit construction fifteen months from now.But Christie found a way to rebuild the Pulaski Skyway. We covered that here. Basically he took Port Authority funds that were supposed to go for a much needed third tunnel under the Hudson River. So why isn’t Paul posting about the fiscal insanity in his own state? My bet is that he would but he is stuck in traffic trying to get back from New York City.