The 105th Congress will not overhaul the federal income tax. Nor will it privatize Social Security, restructure Medicare, or revamp the regulatory code. If the last Congress–especially the GOP freshmen–appeared to approach government cuts with a swagger, the current crop of legislators seems to skulk, hoping to offend no one, especially such noisy organized constituencies as senior citizens, labor unions, and environmentalists.
But the House and Senate will pass bills this session. And if you want to know if the Republican-led Congress has any backbone, pay attention to two items that will be reauthorized: Superfund and the federal highway bill. Both are unglamorous, mind numbingly technical, and riddled with special-interest influence. And neither bill deals with an issue that is necessarily a federal responsibility, making each ripe for reforms consistent with the decentralist approaches Republicans applaud. The direction Congress takes on these bills will signal whether Republicans will battle the Beltway establishment.
Superfund was enacted in 1980 soon after the discovery of toxic chemicals in Love Canal. The Environmental Protection Agency targets "hazardous" waste sites in two ways: by suing the polluters when they can be identified or by cleaning up "orphan" sites (those at which the responsible parties either can't be found or have gone out of business) with taxes collected on crude oil, some commercial chemicals, and certain large businesses.
Environmentalists, state and local officials, policy analysts, and the companies who get stuck with the bills all consider Superfund a failure, though for different reasons. Taxpayers and private parties have spent about $25 billion on the program, yet fewer than 100 of the nearly 1,300 sites have been removed from the EPA's "priorities" list. It takes an average of eight years from the time a site is listed to the time cleanup begins and another four years before it's clean enough to meet EPA standards. And more than half of the money spent on Superfund pays lawyers, administrators, and people who never don rubber boots, let alone a moon suit.
But fixing Superfund requires challenging the program's design and its intent–an outcome those organized interests that benefit from Superfund's complexity and inefficiency may never tolerate. Consider the legal mechanisms that are part of Superfund ostensibly to make polluters pay: strict, joint-and-several, and retroactive liability. Once a Superfund site is identified, any individual, business, or government entity that has placed any amount of hazardous substance at that site can be held responsible for the entire cost of cleanup–even if the substances weren't considered dangerous when they were put there. Little wonder Superfund cleanups cost millions of dollars to complete and take years to settle in court.
Rep. Michael Oxley (R-Ohio) and Sen. Bob Smith (R-N.H.) have proposed ending retroactive liability for actions that took place before Superfund became law and replacing the joint-and-several liability system with one that allocates costs proportionately among the responsible polluters. But such sweeping changes face stiff resistance from Beltway interests. Naderites like the current system because it soaks corporations. Lawyers who represent both polluters and the people who live near the polluted sites are happy because they can line their pockets with legal fees. And environmental groups hold the ultimate trump card: They can claim any changes that appear to weaken Superfund will result in a nation filled with Love Canals.
Under such pressures, it's only too easy for politicians to tinker with rather than overturn the status quo. Indeed, the best we can probably expect from a new Superfund bill are caps on the liability that rural areas, small towns, and small businesses can face. A sweeping overhaul isn't likely.
Even though the interstate highway system is complete (the only "unfinished" portions are intracity beltways local drivers should finance), the Intermodal Surface Transportation Efficiency Act, or federal highway bill, also faces reauthorization this year. ISTEA (pronounced "ice tea" by infrastructure mavens) is the motherlode of political pork, the bill which has previously funded such projects as recreational motorcycle trails, museums, and "demonstration projects" to relieve traffic congestion in rural counties with fewer than 10,000 residents. Rep. Bud Shuster (R-Pa.), the chairman of the Transportation and Infrastructure Committee, was able to deliver a $35 million commuter-rail stop, a $30 million moving sidewalk, and the $286 million Bud Shuster Highway to his hometown of Altoona (population 50,000) when Republicans were still in the minority.
Along with garden-variety pork, federally funded highway projects must conform with a layer of regulations that serve to enrich politically connected contractors and suppliers. Transportation analyst Gabriel Roth, author of last year's Roads in a Market Economy, estimates that federal Davis-Bacon prevailing wage laws and mandates that force federal contractors to buy American-made products make federal road projects 28 percent more expensive than necessary. Reason Foundation President Robert Poole also notes that the feds often prohibit tolls from being charged on federally funded highways, thus preventing experiments with peak-hour pricing and other market-oriented transportation reforms.
Last year, innovative approaches to ISTEA looked possible. The most promising would have taken the source of about half of federal highway funds, the gas tax, out of the congressional pork barrel. House Budget Committee Chairman John Kasich (R-Ohio), Rep. Nick Smith (R-Mich.), and Sen. Connie Mack (R-Fla.), now the chairman of the Joint Economic Committee, proposed returning about 80 percent of the 18.4-cents-a-gallon tax to the states, leaving only a few pennies per gallon to finance maintenance of the highways that have already been built.
But don't hold your breath. Shuster still chairs the transportation committee. And he has no intention of relinquishing his power base. Instead of transferring the gas tax to the states, he wants to remove the federal highway trust fund (where the gas taxes technically flow) from the budgetary process–a plan that would place that $15 billion completely in the hands of Shuster and other political bosses. Shuster may also be willing to dedicate as much as one-half cent of the gas tax to fund Amtrak–providing life support to a hopeless boondoggle. This ploy would also give Shuster an important ally, Amtrak enthusiast William Roth (R-Del.), chairman of the Senate Finance Committee.
Both Superfund and the highway bill offer clear tests of whether members of Congress will relinquish a bit of their power or will succumb to the temptation to, as Gov. Lepetomaine said in Blazing Saddles, "protect [their] phony-baloney jobs." For now, bet on the baloney.
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