Doesn't Look Like it
As our governor and legislature hash out a deal on infrastructure bonds, the conventional wisdom is that we'll converge on a win-win scenario: democrats will temper Schwartzeneger's all-roads vision of transportation with funding for transit and affordable housing, and everyone will be happy.
But will any of this really fix anything? No city has ever actually "solved" its traffic problems by building more roads. On the other hand, the cost effectiveness of many new transit projects (measured, say, in cost per new rider) is frankly embarassing.
Why Not?
The CalTrans/Dorito-Chip philosophy of "drive all you want, we'll build more roads" serves no-one except the construction industry. The same can be said of investment in transit as a "greener alternative" to driving, if few people actually choose it. So before spending any more money, we should think hard about getting better use out of our transportation infrastructure.
Wisdom cannot be legislated, but wise use of resources can be encouraged with financial incentives. In short, users of transportation infrastructure should pay for it, and at rates reflecting the demands they put on it.
But who are these users? An obvious place to start is with us individual commuters, who have some choice in where we live and how we get about. But this is where most efforts to change travel habits--carpool lanes, silly campaigns like "bike to work" and "save the air" days--stop, and that is a mistake. It's really our employers who determine whether taking transit to work is a realistic alternative to driving, simply by whether they set up shop anywhere near a station. And whether we can afford to live anywhere close to work depends on whether the city it's in has allowed enough housing. All too often California cities are eager for commercial development, to draw business and sales tax revenue, but are loathe to allow new housing, lest density disturb their suburban tranquility, or at best allow a few pockets yuppie condos in trendy locations. So local government and business effectively become "users" of transportation infrastructure, by deciding where we should live and work, and how we can get between them--generally with no regard to the strain this puts on the system.
What Might Work
If we want to encourage more efficient use of transportation resources, we need to give all three types of users incentives. Raising the gas tax would incent individuals to try alternatives to driving, and while it would certainly be better to pay for highway costs that way than by raiding education, etc. for state funds, individuals already have strong financial incentives to cut down on driving, but usually little choice. Anyway, rather than asking ordinary folks to pay more taxes, it might be more productive to charge existing fees and expenses on a more per-mile basis; for example, make the interval to pay registration, get your car smogged, pay insurance, etc every x-ty thousand miles, instead of by the calendar. After all, it's use of a car, not the mere ownership, that adds to traffic and pollution.
To motivate a more transit-friendly attitude in business, I suggest a simple solution: tax parking. A parking space in front of a place of work is an expectation that someone will drive there; and as individuals fulfill it by the millions, the cost to the public is gridlock, smog, and the need to spend billions on new and wider freeways. It's only fair to send a bill, and allow businesses that save the public money by making transit work for their employees to save money themselves.
As to how to motivate cities to allow more housing; I don't know the best answer, but considering how much local government relies on the state for revenue, it shouldn't be hard to come up with something. The goal should be to get cities to provide housing in some reasonable ratio (like 1:1) to the employment capacity of it's commercial space; a good incentive would be to withold all transportation funding til they do so--no new housing, no help with potholes.
Enough Ranting for Now
All of these proposals are likely to meet with some resistance, since they make some assumptions that run against the grain of modern American life: that roads are a resource, and you should pay to use them, that business should pay for its use of public infrastructure, and that communities have an obligation to take in newcomers. And since I'm writing this as an "unfunded think tank of one", I'm sure there's plenty of holes that can be poked in all this. Still, it's a place to start, and ideas that
might work are a better place to begin discussion than a status quo we all know doesn't!