Bush: No tax hike for bridges

President Bush on Thursday rejected raising the federal gasoline tax by a few cents to pay for repairs to hundreds of aging bridges across the country, accusing members of Congress of squandering previous highway funding on pet projects.

Bush used a wide-ranging news conference -- his last before leaving Washington for a summer vacation -- to chide lawmakers for their priorities in a $284-billion highway bill that he signed into law in 2005.

“Before we raise taxes, which could affect economic growth, I would strongly urge the Congress to examine how they set priorities,” he said. “And if bridges are a priority, let’s make sure we set that priority first and foremost before we raise taxes.”

The president was responding to an idea proposed by Rep. Don Young (R-Alaska), a former chairman of the House Transportation and Infrastructure Committee, who said as many as 500 bridges nationally have the same design as the one that collapsed Aug. 1 in Minneapolis. “These are potential deathtraps,” he said, according to the Associated Press. “We have to, as a Congress, grasp this problem. And yes, I would even suggest: Fund this problem with a tax. . . . May the sky not fall on me.”

Bush has made a point of decrying all potential tax increases.

In the news conference, Bush also tried to calm the financial markets, which have been volatile. (The Dow Jones average lost nearly 400 points Thursday.)

“My belief is that people will make rational decisions based upon facts,” he said. “And the fundamentals of our economy are strong.”

The president added that he and his advisors believed that the housing market, troubled by mortgage defaults, was not in a crisis. “It looks [like] we’re headed for a soft landing. That’s what the facts say,” Bush said.

On the subject of taxes, Bush acknowledged that his administration was in the “very early stages” of considering whether to simplify the corporate tax code to lower rates across the board. He said any change would have to be “revenue-neutral,” with the lower rates offset by ending some tax breaks.

“If the conclusion is . . . that our tax structure makes it harder for businesses to compete, therefore making it harder for people to find work over time, then we need to address the competitive imbalance in our tax code,” Bush said.

The news conference took place hours before the president departed for his family’s vacation compound in Kennebunkport, Maine. French President Nicolas Sarkozy is to join him for a social lunch there Saturday. On Monday, Bush is to fly to Crawford, Texas, for a two-week vacation, interrupted by a brief trip to Canada next week.

On other topics, Bush replied to a question about an International Red Cross report that allegedly documented torture of prisoners at the U.S. detention facility at Guantanamo Bay, Cuba, by saying of the report: “I haven’t seen it. We don’t torture.”

Bush said it remained his “aspiration” to close the facility. “We are working with other nations to send folks back. Again, it’s a fairly steep order,” Bush said. “A lot of people don’t want killers in their midst, and a lot of these people are killers.”

He responded testily to a suggestion that his decision to commute former vice presidential aide I. Lewis “Scooter” Libby’s 30-month prison sentence for perjury and obstruction of justice might indicate a lack of accountability in his administration. “Lewis Libby was held accountable,” Bush said sharply. “He was declared guilty by a jury, and he’s paid a high price for it.”

Bush also defended his administration and promised a “full investigation” in the case of Army Ranger Pat Tillman, the former football star killed by friendly fire in Afghanistan. Asked about when he learned that Tillman’s death was an accident, Bush replied: “I can’t give you the precise moment.”

The nation’s infrastructure has gained urgency in Congress not only because of the Minneapolis bridge failure, but because of a projected shortfall of nearly $4 billion in the highway trust fund in fiscal 2009.

Sen. Patty Murray (D-Wash.), who is head of the Senate transportation appropriations subcommittee, said that the president had a “tin ear” on priorities. “He has spent more than $40 billion to rebuild Iraq -- that’s more than his annual investment in highways throughout the United States,” she said.

Bush’s comments came a day after House Transportation and Infrastructure Committee Chairman James L. Oberstar (D-Minn.) announced plans to push a bill to establish a fund to repair or replace structurally deficient bridges, possibly from a “temporary user fee” on gasoline. Oberstar stopped short of calling for an increase in the federal gasoline tax, which is 18.4 cents a gallon and was last raised in 1993.

When Congress was drafting the 2005 highway bill, then-Chairman Young called for a gas tax increase to maintain the aging interstate system and ease traffic. Bush threatened to make the highway bill his first veto if it included a tax increase, and he fought members of both parties to keep down the bill’s cost.

The six-year, $286-billion highway bill contained 6,371 earmarks -- funds allocated to specific projects at the request of members of Congress -- costing more than $24 billion, according to Taxpayers for Common Sense, a nonpartisan watchdog.

When Democrats took control of Congress in January, they pledged to reduce the number of earmarks.

The House-passed transportation appropriations bill includes hundreds.

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maura.reynolds@latimes.com

richard.simon@latimes.com