Finley: Politics of road deal are baffling

Nolan Finley
The Detroit News
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Set aside the debate over whether the road bill passed last week by the Legislature is more good than bad. It’s the politics of the deal that don’t make sense to me.

Lawmakers clearly were trying to spread the pain of raising $1.2 billion as broadly as possible. So they got some money from higher fuel taxes, some from larger vehicle registration fees, and half from unspecified spending shifts.

Their strategy, I assume, was that getting chunks of money from different places would mute the overall impact and make voters notice less the tax hikes.

I think the opposite is more likely. Voters now have more reminders of how the road bill affects their pocketbooks.

That’s particularly true of the 20 percent increase in vehicle registration fees, which comes due every time the motorist has a birthday. So every year, those who write the checks will get angry anew at what the Legislature did.

The same is true for when it’s time for future lawmakers to figure out how to fill the $600 million hole the deal is going to blow in the General Fund budget. While nearly everyone says they favor belt tightening over tax hikes, every dollar spent by government has a constituency. When cuts come in education or health care or corrections, and are blamed on the roads bill, resentment of the deal will grow.

Lawmakers should have gone ahead and raised most, if not all, of the new roads revenue from a fuel tax hike. The political heat they’ll take from raising the tax 7.3 cents a gallon is not much different from what they would have endured by hiking it 15 cents.

Voters won’t remember the amount. They’ll just recall that taxes were raised. So whenever fuel prices spike — whether or not there’s a link to the gasoline tax — motorists are going to blame the deal. Better to concentrate both the resentment and the revenue raising in one place where, if lawmakers are lucky, they’ll be bailed out by ongoing declines in pump prices.

The other thing I don’t fully get is why the Legislature back-loaded the benefits of the bill. Clearly lawmakers wanted the taxes to kick in after they face voters next year. But that further delays the fixing of roads. But motorists will be paying the higher taxes well before they see potholes disappearing.

So why not get faster credit for the positive results of these tough decisions? It’s possible, but not certain, that the state could bond against anticipated revenue to get additional work started right away. But it’s not going to be of the magnitude to get taxpayer attention.

Ideally, lawmakers would have been able to go back to their districts and say, “Yeah, I raised your taxes. But look at the paving crews moving in to fix the road that busted your tires last winter.” Now, all they can say is, “I raised your taxes.”

They played this as poorly as possible. Motorists who at one time got accustomed to paying $3.50 to $4 a gallon for gasoline would have quickly absorbed a bigger fuel tax hike with costs falling toward $2 a gallon.

It’s bad enough lawmakers got the policy wrong on this road deal. But they bungled the politics, too, and politics were what was motivating their policy making.

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