More great grandmas are behind the wheel.
With a 2.9 percent increase from 2013 to 2014, the fastest growing driving demographic is people over 85. And great grandma (or grandpa) is sharing the road with a bigger number of 50+ people. Among the 214 million individuals with drivers licenses, close to 96 million are older than 50. Meanwhile the number of teenagers with licenses declined from 8.9 million to 8.4 million.
Where are we going? To our transportation infrastructure.
FAST (Fixing America’s Surface Transportation Act)
The Congress just said yes to five years of transportation funding and the President will sign the law today. Called FAST, the Fixing America’s Surface Transportation Act is a 1300-page $305 billion highway and transit bill. Its major provisions include a resuscitation of the nearly insolvent Highway Trust Fund, separate support for Amtrak, mass transit money for the Northeast corridor, and a new initiative targeting freight projects. The main goal though is highway funding.
And that was the problem.
Primarily supported by a gasoline tax that is increasingly inadequate, the federal Highway Trust Fund needed a fresh injection of money. Because the Congress refused to raise the gasoline tax (which has been 18.4 cents since 1993), it had to look near and far for additional funds.
That takes us to Fed Chair Janet Yellen. In yesterday’s Congressional testimony, Dr. Yellen expressed displeasure that the new highway and transit bill was receiving money from the Federal Reserve’s surplus account and dividend dollars the Fed pays to large banks. Other funding includes $6.2 billion from strategic oil reserve sales and whatever can be collected from people who did not pay their taxes.
The money for our roads and public transit flows from the federal government to the states who then give some of their funding to smaller municipalities.
You can see the path in this Pew Charitable Trusts infographic:
The proportion of federal funding though varies considerably. Looking at average spending on surface transportation from 2007-2011, Pew tells us that Montana and Rhode island received 55 percent of their funding from the federal government while for New York, the total was only 15 percent and California, 21 percent.
Our Bottom Line: Transportation Infrastructure
Moving from 18th century roads to 19th century canals and railroads to a 20th century interstate highway system (with an increasing number of 85 year old drivers), the growth of our transportation infrastructure has played a crucial role in our economic development.
What should be next?