The Future of American Roadway Maintenance Unclear
I came across on article entitled “Oil Industry Braces for Drop in U.S. Thirst for Gasoline” in the April 13 copy of the Wall Street Journal. The article explains that since the introduction of the mass-produced Model T nearly a century ago, U.S. demand for oil has been on the rise until now. The article claims that many of the oil industry’s most prominent members including Exxon Mobil Corp., believe that U.S. gasoline consumption has peaked and will never again attain such levels. The U.S. Energy Information Administration reports that American drivers consumed 371.2 million gallons of petroleum-based gasoline a day in 2007 and that this figure is expected to decline in 2009 to 345.7 million gallons daily. One might say the current recession is to blame for decreased gasoline consumption which is essentially true but Americans have begun to alter their lifestyles as well. Americans have recently made a concentrated effort to decrease commuting distances and driving overall as gasoline prices skyrocketed as recent as last summer. Those deeply involved in the industry believe that even after the economy strengthens, gasoline consumption will never again reach the levels it did in 2007 due to the emergence of biofuels and more energy efficient vehicles such the hybrid. One might additionally argue that certain policies promoted by the Obama administration are fueling the energy revolution and thus will have a decreasing impact on overall gasoline consumption. While this trend is generally regarded positively as a step in the right direction, concern has risen regarding the tax revenue that gasoline consumption supplies. The article notes that federal gasoline-tax revenue fell 3% last year and that the trend must inevitably continue as consumption declines. This reveals a major concern that needs to be addressed. What is the future of America’s highways and roads that are currently funded primarily by gasoline-tax revenue? How will the United States maintain and repair its massive highway system as funds decrease? One suggestion is to tax drivers per mile driven rather than by the gallon to incorporate the use of biofuels and more energy efficient vehicles but how would such a policy be enacted? Would one have to report miles driven annually with your income taxes? In my mind such a policy seems implausible, but I can’t think of any alternatives. Are there any better suggestions? How can America continue to contribute to the Highway Trust Fund as gasoline-tax revenues decline?