The Phony Math of Highway Trust Fund

Friday, July 6th, 2012 and is filed under Blog, Debt

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Lies, distortions, and obfuscations.

That’s how Democrats and Republicans alike sold us a broken highway trust fund under the guise of cutting spending.

Following passage of the massive highway/student loan omnibus, the politicians are telling us that the highway trust fund is on solid footing.  In fact, they contend that the new bill cut $16 billion in spending.  The reality is that the bill relies on a tenuous patchwork of extraneous offsets that should go to pay down existing debt.  Supporters are also obfuscating the fact that there is an $18 billion general fund transfer to the HTF.

Normally we like to present our own analysis, but Taxpayers for Commons Sense has done yeoman’s work in shedding light on how Congress has gamed the CBO in order to result in a positive score.  This is how we got to $15.8 trillion in debt:

Let’s look at the tortured math…

First, the $16.3 billion includes $11.2 billion in increased premiums from the Pension Benefit Guaranty Corporation – which is itself $26 billion in debt!

But for arguments sake, let’s leave that aside for a second.

This bill reduces the debt by $16.3 billion only if you don’t include the $18.8 billion transfer from the Treasury to the Highway Trust Fund! Or the transfer of $2.4 billion from the Leaking Underground Storage Tank (LUST) Fund to the Highway Trust Fund!


So, here’s how the Senate math works:

  1. Add up the revenue (from things like changes to pensions) and subtract out the expenses (for things like Secure Rural Schools and Payment in Lieu of Taxes) = $16.3 billion in deficit reduction
  2. Ignore the $18.8 billion transfer from the Treasury (because, in Congressional parlance that nobody in the real world could possible understand, it would not increase “direct spending”, duh!, so it doesn’t count) and the $2.4 billion transfer from LUST. In fact, you can see how the Senate treats both provisions (“This provision does not have a budgetary effect.”) in the Senate Finance summary.
  3. Result? $16.3 billion in debt reduction!!!!! (see how easy that was?)