U.S. roads and bridges are in abysmal shape – and that was before the recent winter storms made things even worse.
In fact, the government rates over one-quarter of all urban interstates as in fair or poor condition and one-third of U.S. bridges need repair.
To fix the potholes and crumbling roads, federal, state and local governments rely on fuel taxes, which raise more than US$80 billion a year and pay for around three-quarters of what the U.S. spends on building new roads and maintaining them.
I recently purchased an electric car, the Tesla Model 3. While swerving down a particularly rutted highway in New York, the economist in me began to wonder, what will happen to the roads as fewer and fewer cars run on gasoline? Who will pay to fix the streets?
Fuel taxes 101
Every time you go to the pump, each gallon of fuel you purchase puts money into a variety of pockets.
About half goes to the drillers that extract oil from the earth. Just under a quarter pays the refineries to turn crude into gasoline. And around 6 percent goes to distributors.
The rest, or typically about 20 percent of every gallon of gas, goes to various governments to maintain and enhance the U.S. transportation’s infrastructure.
Currently, the federal government charges 18.4 cents per gallon of gasoline, which provides 85 percent to 90 percent of the Highway Trust Fund that finances most federal spending on highways and mass transit.
State and local government charge their own taxes that vary widely. Combined with the national levy, fuel taxes range from over 70 cents per gallon in high-tax states like California and Pennsylvania to just over 30 cents in states like Alaska and Arizona. The difference is a key reason the price of gasoline changes so dramatically when you cross state lines.
While people often complain when their fuel prices go up, the real burden of gasoline taxes has been falling for decades. The federal government’s 18.4 cent tax, for example, was set way back in 1993. The tax would have to be 73 percent higher, or 32 cents, to have the same purchasing power.
On top of that, today’s vehicles get better mileage, which means fewer gallons of gas and less money collected in taxes.
And electric vehicles, of course, don’t need gasoline, so their drivers don’t pay a dime in fuel taxes.
A crisis in the making
At the moment, this doesn’t present a crisis because electric vehicles represent only a small proportion of the U.S. fleet.
Slightly more than 1 million plug-in vehicles have been sold since 2012 when the first mass market models hit the roads. While impressive, that figure is just a fraction of the over 250 million vehicles currently registered and legally drivable on U.S. highways.
But sales of electric cars are growing rapidly as how far they can travel before recharging and prices fall. Dealers sold a record 360,000 electric vehicles last year, up 80 percent from 2017.
If sales continue at this breakneck pace, electric cars will become mainstream in no time. In addition, governments in Europe and China are actively steering consumers away from fossil fuels and toward their electric counterparts.
In other words, the time will come very soon when the U.S. and individual states will no longer be able to rely on fuel taxes to mend American roads.
What states are doing about it
Some states are already anticipating this eventuality and are crafting solutions.
One involves charging owners of electric cars a fixed fee. So far, 17 states have done just that, with annual taxes ranging from $100 to $200 per car.
There are a few of problems with a fixed fee approach. For example, the proceeds only go to state coffers, even though the driver also uses out-of-state roads and national highways.
Another is that it’s regressive. Since a fixed fee hits all owners equally, regardless of income or how much they drive, it hurts poorer consumers most. During debate in Maine over a proposed $250 annual EV fee, opponents noted that the average person currently pays just a third of that – $82 – in state fuel taxes.
Oregon is testing another solution. Instead of paying fuel taxes, drivers are able to volunteer for a program that lets them pay based on miles driven rather than how many gallons they consume. The state installs tracking devices in their cars – whether electric or conventional – and drivers get a refund for the gas tax they pay at the pump.
The program raises privacy and fairness concerns especially for rural residents who have few other transportation options.
Another way forward
I believe there’s another solution.
Currently, carmakers and others are deploying large networks of charging stations throughout the country. Examples include Tesla’s Superchargers, Chargepoint, EVgo and Volkswagen’s proposed mobile chargers.
They operate just like gas pumps, only they provide kilowatts of electricity instead of gallons of fuel. While electric vehicle owners are free to use their own power outlets, anyone traveling long distances has to use these stations. And because charging at home is a hassle – requiring eight to 20 hours – I believe most drivers will increasingly choose the convenience and speed of the charging stations, which can fill up an EV in as little as 30 minutes.
So one option could be for governments to tack on their taxes to the bill, charging a few extra cents per kilowatt “pumped into the tank.” Furthermore, I would argue that the tax – whether on fuel or power – shouldn’t be a fixed amount but a percentage, which makes it less likely to be eroded by inflation over time.
It is in everyone’s interest to ensure there are funds to maintain the nation’s road. A small percentage tax on EV charging stations will help maintain U.S. roads without hurting electric vehicles’ chances of becoming a mass market product.
9-year-old genius to graduate university
(CNN) – A child prodigy from Belgium is on course to gain a bachelor’s degree at the tender age of 9.
Laurent Simons is studying electrical engineering at the Eindhoven University of Technology (TUE) — a tough course even for students of an average graduate age.
Described by staff as “simply extraordinary,” Laurent is on course to finish his degree in December.
He then plans to embark on a PhD program in electrical engineering while also studying for a medicine degree, his father told CNN.
His parents, Lydia and Alexander Simons, said they thought Laurent’s grandparents were exaggerating when they said he had a gift, but his teachers soon concurred.
“They noticed something very special about Laurent,” said Lydia.
Laurent was given test after test as teachers tried to work out the extent of his talents. “They told us he is like a sponge,” said Alexander.
While Laurent comes from a family of doctors, his parents have so far not received any explanation as to why their child prodigy is capable of learning so quickly.
But Lydia has her own theory.
“I ate a lot of fish during the pregnancy,” she joked.
The TUE has allowed Laurent to complete his course faster than other students.
“That is not unusual,” said Sjoerd Hulshof, education director of the TUE bachelor’s degree in electrical engineering, in a statement.
“Special students that have good reasons for doing so can arrange an adjusted schedule. In much the same way we help students who participate in top sport.”
Hulshof said Laurent is “simply extraordinary” and praised the youngster.
“Laurent is the fastest student we have ever had here,” he said. “Not only is he hyper intelligent but also a very sympathetic boy.”
Laurent told CNN his favorite subject is electrical engineering and he’s also “going to study a bit of medicine.”
His progress has not gone unnoticed and he is already being sought out by prestigious universities around the world, although Laurent’s family wouldn’t be drawn on naming which of them he is considering for his PhD.
“The absorption of information is no problem for Laurent,” said his father.
“I think the focus will be on research and applying the knowledge to discover new things.”
While Laurent is evidently able to learn faster than most, his parents are being careful to let him enjoy himself too.
“We don’t want him to get too serious. He does whatever he likes,” said Alexander. “We need to find a balance between being a child and his talents.”
Laurent said he enjoys playing with his dog Sammy and playing on his phone, like many young people.
However, unlike most 9-year-olds, he has already worked out what he wants to do with his life: develop artificial organs.
In the meantime, Laurent has to finish his bachelor’s degree and choose which academic institution will play host to the next stage in his remarkable journey.
Before that, he plans on taking a vacation to Japan for an undoubtedly well-deserved break.
New award to honor arts and activism named after Lena Horne
Gang members slam BMW into rival and his 8-year-old son in Harlem
Two gangbangers aimed their BMW like a missile at a father and his 8-year-old son on a Harlem sidewalk in a horrifying incident captured by video distributed by police Thursday.
The BMW — driven by a man police believe is a member of the Gorilla Stone Bloods Gang — was zeroed in on the father, a rival gang member, said cops.
Around 3:45 p.m. Nov. 6, the boy and his father were walking on W. 112th St. by Adam Clayton Powell Jr. Blvd. when the BMW jumped the sidewalk and slammed into them both, said cops.
🚨WANTED for ASSAULT: on 11/6 at approx 3:43 PM in front of 128 West 112th St in Manhattan, a 32 yr old male was walking with his 8 yr old son when a white BMW jumped the curb & hit the father & son. The driver then got out and slashed the father. Call @NYPDTips with any info. pic.twitter.com/cwd79rcM4c
— NYPD NEWS (@NYPDnews) November 15, 2019
Father and son were both knocked through a gate.
The BMW driver then backed up — and its driver and passenger, also believed to be a gang member, jumped out of the car and ran toward the father and the son.
One of the attackers slashed the father, identified by sources as 32-year-old Brian McIntosh, who’s served prison time for robbery and bail jumping.
McIntosh and his son went to Harlem Hospital. Miraculously, the boy escaped serious harm.
McIntosh was so adamant about refusing to help police catch his attackers that the young boy’s mother had to file a police report alleging he was the victim of a crime, police sources said.
Cops released video of the attack, and ask anyone with information about the suspects to call Crime Stoppers at (800) 577-TIPS.
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