Cutting the Federal Budget To Prevent U.S. Bankruptcy, Part VI: Trimming the Transportation Department

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by Jim Grichar (aka Exx-Gman) by Jim Grichar

(Author's note: I ask readers for their indulgence because of my extensive use of the b-lingo – bureaucrat-lingo – and the detail I used in presenting my arguments. I do this to reduce bureaucratic counter-arguments – which I expect to receive – to the absurdity that they invariably are.)

For those who did not read Parts I–V of this series, total actual cuts in proposed spending (what I call the "Cut-o-meter") now amount to $337 billion. Those cuts came from Defense, NASA, HUD, the Education Department, the Agriculture Department, and other agencies.

The Department of Transportation (DOT) budget is one that is loaded with pork, and it is ripe for trimming. At a proposed level of nearly $59 billion for fy 2005, it contains loads of useless projects and programs.

DOT, in the b-lingo, is an agglomeration of a wide variety of welfare-state programs along with regulatory schemes that force states, when getting associated federal monies, to comply with a host of federal environmental and safety regulations; in other words, the feds get to impose a load of unfunded mandates on states, a hidden form of taxation.

Among those DOT organizations which often make life miserable for the average American are the Federal Aviation Administration (still running a monopolistic and antiquated system for directing airliners operating in U.S. airspace), the Federal Highway Administration (pork for highway construction along with enforcement of federal pollution control regulations for cars and trucks), the Federal Railroad Administration (which primarily subsidizes Amtrak), and the Federal Transit Administration (it sends pork to local transit authorities).

The Federal Aviation Administration (FAA) is a nightmare of an operation, with proposed fy 2005 spending of about $14.5 billion. A large chunk of its budget comes from a dedicated tax on airline tickets that funds a large part of the FAA's operations ($6 billion comes from the airport and airways trust fund, which is fed by the airline ticket tax and some other taxes labeled "user fees"). Other than operations, the FAA proposes to shovel out $3.5 billion for local airports and also spend another $2.8 billion for airport facilities and equipment, probably including money for a continuance of its decrepit air traffic control system. This outfit should be privatized in total, making airlines responsible for the system. First cuts should be made to the grants for airport construction, saving $3.5 billion. Later, significant additional savings would come from privatization.

The Federal Highway Administration's proposed budget for fy 2005 is approximately $33.6 billion, with most of that money – nearly $33 billion – slated for grants to states for highway construction. These funds come from the 18.4-cent per gallon federal gasoline tax (note that gasolines containing a blend of 5.7% ethanol are taxed at 15.4 cents per gallon, another of the subsidies to Archer Daniels Midland, the big agribusiness and largest producer of ethanol). Withholding these funds is a way to force states to comply with Washington's dictates for clean air standards. While those lobbying for federal highway funds would let out a howl, this spending should be cut by at least one-third, or by $11 billion. Roads are a matter for states, not the federal government. An end to the federal gas tax would be a logical next step following the scaling down and eventual abolishment of the Federal Highway Administration.

The National Highway Traffic Safety Administration – Lyndon Johnson's tribute to Ralph Nader and his safety guru Joan Claybrook – wastes about $0.5 billion a year. In an era when consumers demand safe cars, this outfit is an anachronism and should be abolished. In fact, its mandate on air bags has actually led to more deaths in traffic accidents, particularly among children and the elderly, who cannot easily withstand the impact of air bag on their faces and torsos.

The Federal Railroad Administration is kept alive mainly by the existence of Amtrak, the subsidized federal passenger rail system. Out of the estimated $1.15 billion proposed for fy 2005, $0.9 billion is slated for Amtrak. This turkey has been kept alive by East Coast politicians and business people, who enjoy taking the train from Washington to New York City to Boston. It's time to end this ridiculous anachronism. Abolish the organization and save the money.

The Federal Transit Administration – which sends money to local transit authorities – is budgeted at $7.7 billion for fy 2005. Most of the funds are subsidies for local transit authority operations. In some cases, the federal government has subsidized construction of highly expensive subway systems, such as the one in the Washington, D.C. metropolitan area. U.S. taxpayers ponied up roughly $15–20 billion to help construct this gold-plated system (only the best for our commuting bureaucrats!!). Why people in Peoria should pay to help out commuters in other areas is a question that most inside the Washington beltway would never even ask. Time to finish off this pork barrel program.

There are several other smaller items in the DOT budget, including the Federal Motor Carrier Safety Administration, which somehow has gotten authority to license interstate motor carriers. What they do for the proposed $0.287 billion in spending is a good question. Abolish it.

And the Cut-o-meter Total is … $360 billion!

Cuts proposed from the Department of Transportation budget add up to about $24 billion from the proposed fy 2005 level and about $23 billion from the current year's budget. Adding in the $23 billion in cuts from the current spending level brings the Cut-o-meter total up to $360 billion.

While there is still a long way to go in eliminating the $500–550 billion deficit, there are still lots more vulnerable departments and programs.

Jim Grichar (aka Exx-Gman) [send him mail], formerly an economist with the federal government, writes to “un-spin” the federal government’s attempt to con the public. He teaches economics part-time at a community college and provides economic consulting services to the private sector.

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