The price of cheap politics

The New York Post reports that President Trump is considering suspending the federal gas tax — a levy of 18.4 cents per gallon on gasoline — even as four states have already moved ahead of him with their own suspensions before the midterm elections. The instinct is familiar: prices rise, the public grumbles, and the treasury is instructed to absorb the wound. I confess I have never admired this kind of governing, even when the man proposing it wears the right colors.

Let us be precise about what the gas tax actually is. It is not an arbitrary imposition. The federal fuel excise feeds the Highway Trust Fund — the principal instrument by which the national government builds and maintains the roads, bridges, and arteries of American commerce. To suspend it is not to cut waste. It is to cut the scaffolding on which the productive economy moves its goods. Every container, every pallet, every manufactured thing that reaches its buyer over a federal highway is a beneficiary of that fund. Infrastructure is not a luxury; it is the sinew of a commercial republic. I argued as much in my Report on Manufactures, and the principle has not aged.

Now, I will grant the case for the other side its strongest form. When prices at the pump are high, the working family that commutes forty miles each way to the factory floor bears a real and crushing burden. A government indifferent to that burden is not a vigorous government; it is a callous one. Relief for the struggling citizen is a legitimate object. I do not dispute the goal — only the instrument.

The difficulty is that a tax suspension is a blunt and temporary remedy that produces a permanent fiscal scar. When the suspension ends, prices climb again — and the Trust Fund has been depleted in the interval. The highway contractor who needed certainty to bid a multi-year project did not get it. The bridge that required a funding commitment was left to wait. Meanwhile, the 18.4 cents of relief rarely reaches the consumer in full; fuel markets are not so obliging. Inference — not from any source in front of me, but from the ordinary logic of commodity markets — suggests that a share of the suspension is captured upstream by distributors and refiners before it reaches the pump.

Four states have already acted, the Post reports. That is precisely the kind of uncoordinated, piecemeal fiscal response that the federal government was designed to supersede. When each state cuts its own fuel tax in a race to offer the quickest relief, you produce a patchwork that distorts interstate commerce and leaves the national infrastructure network underfunded from every direction at once. This is exactly the commercial chaos the Commerce Clause and federal revenue power were meant to prevent.

My recommendation is this: if the administration wishes to ease the burden on working families at the pump, it should do so through targeted measures — a refundable credit for lower-income households, for instance — that do not hollow out the trust fund supporting American roads. Better still, it should be pressing for an increase in the fuel tax, indexed to inflation, which has eroded its real value for decades. I know that is not a popular sentence. I have never found that popularity and correctness travel together reliably. The republic's infrastructure will not maintain itself on applause.