Chao: Transportation department has rare opportunity
Of all of Donald Trump’s Cabinet nominees, Elaine Chao will have a relatively easy time getting confirmed.
But in her new job at the Department of Transportation, there may be a rough road ahead.
Chao stands to inherit a long-term funding crisis in the nation’s transportation system, and in spite of Trump’s promises to invest heavily in infrastructure, finding the money may not prove any easier for her than it was for any of her predecessors of the past 10 to 15 years.
“She’s going to have a really difficult time managing the needs of the system,” said Katie Thomson, the department’s general counsel from 2014 to 2016. “There just isn’t enough money to go around.”
Every year since 2008, the federal fund that pays to build and maintain roads, bridges and transit systems has fallen short of the revenue needed by the states.
Congress has not raised the federal gasoline tax that supports it since 1993, and has shown little inclination to do so. Transportation spending exceeds revenues by $14 billion a year, and that’s projected to increase to $21 billion a year within eight years.
“The Highway Trust Fund is in bad shape,” Chao soberly noted in her Senate confirmation hearing on Wednesday.
And that’s just to maintain the current level of funding to keep the system in good repair. Meanwhile, the oldest parts of the Interstate Highway System are approaching 60 years old and need to be rebuilt.
Trump’s campaign platform included the promise of “a bold, visionary plan for a cost-effective system of roads, bridges, tunnels, airports, railroads, ports and waterways, and pipelines.”
Trump’s fiscal blueprint consists largely of tax credits to stimulate private investment.
“We believe that this tax-credit-assisted program could help finance up to a trillion dollars’ worth of projects over a 10-year period,” said an analysis of Trump’s plan co-written in October by Wilbur Ross and Peter Navarro, Trump advisers on trade who have been tapped for roles in the new administration.
Reflecting a common conservative view in the questionnaire she submitted to the Senate Commerce Committee, Chao appeared to emphasize removing regulatory barriers to projects over finding new sources of funds.
“With or without a new infusion of funds,” she wrote, “it is necessary to look at the existing processes for infrastructure development and find more efficient ways to address bottlenecks in planning and permitting.”
Democrats have been receptive to Trump’s infrastructure ambitions, but they want a plan “backed by real dollars and not just tax credits,” as Senate Minority Leader Chuck Schumer of New York described it shortly after Chao’s nomination was announced.
Chao may ask states to take on more of the responsibility of managing their transportation needs. The conservative Heritage Foundation, where Chao was a distinguished fellow from 2009 to last year, supports this shift.
“The government doesn’t have the resources to do it all,” Chao testified in Wednesday’s hearing.
Already, out of necessity, states have imposed new tolls on roads and bridges, entered agreements with private companies to share construction costs, raised their own gas or sales taxes and borrowed more money.
While many of those efforts have proved successful, mayors and governors from across the country, and the political spectrum, have come to Washington to tell lawmakers that they can’t do everything on their own.
Chao has long-standing credibility in the transportation world, having served as the department’s deputy secretary from 1989 to 1991 under President George H.W. Bush.
She’s already familiar to the senators who will vote on her nomination: She was President George W. Bush’s labor secretary, and she’s married to Senate Majority Leader Mitch McConnell of Kentucky, who introduced her to the Senate Commerce Committee on Wednesday.
It was just a formality: She’s friends with many lawmakers and their spouses, and they gave her a warm welcome.
“It helps that she’s a creature of Washington and knows Washington,” Thomson said.
But Thomson said that if Congress went cold on Trump’s plan, it wasn’t going anywhere.
“My guess is that Trump will care about transportation,” she said, “but he won’t view it as a sexy, top-tier issue he wants to deal with.”