Michael Hiltzik: Rick Perry runs off the highway
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Texas Gov. Rick Perry’s take on the federal Highway Trust Fund is something of a car wreck.
Perry’s hastily assembled economic plan released Tuesday holds up the Highway Trust Fund as the model for how to ‘protect’ federal funds from being raided by Congress for ‘unrelated purposes.’ The idea is to contrast the HTF with the Social Security trust fund, which Perry claims has been ‘pilfered...by spendthrift Washington politicians.’
Thus Perry manages to demonstrate that he doesn’t know the first thing about either fund.
Funded principally from federal gasoline taxes, the Highway Trust Fund has, in fact, been a disaster. In May, the Congressional Budget Office forecast that it would be out of money by mid-2012 -- in effect, bankrupt. By 2018, the CBO says, its shortfall of receipts versus proposed expenditures will be $80 billion.
Not even the right-wing Heritage Foundation would agree that it’s been well-managed. In fact, Heritage offers a list of all the ways Congress has raided the fund -- for ferry boats and magnetic levitation research, among other things.
Congress borrows from the highway fund all the time. But it also requires the fund’s balance to be invested in non-interest bearing securities, thus stiffing motorists on the interest their tax funds would accrue. By contrast, the Social Security trust fund must by law be invested in interest-paying Treasury bonds. That trust fund collected $117 billion in interest last year on its balance of more than $2.5 trillion -- a risk-free return of better than 4.6%.
Perry’s critics in both parties will no doubt be picking apart all the details of his economic plan in coming days. But this one bollixed nugget leads us to ask: Did he do all his research this way?
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-- Michael Hiltzik
