Tag: Earmarks

House Appropriations Chairman Hal Rogers on the Budget

Following the House’s passage of a six-month continuing resolution last week (my comments on the CR here), House Appropriations Committee Chairman Hal Rogers (R-KY) chatted about fiscal policy with a couple of reporters on C-SPAN. The interview did nothing to change my 2010 opinion that the House leadership handing Rogers the chairman’s gavel was “about as inspiring as re-heated meatloaf.”

While Rogers is correct that domestic discretionary spending represents a relatively small share of total spending (approximately 12 percent) and that entitlement spending is the bigger problem, his comment that “we’ve just about reached the bottom of the barrel” on such spending is a stretch. Domestic discretionary spending has dropped, but after a sizeable increase during the 2000s. And arguably more important than the dollar amount this category represents are the activities being funded. For example, the federal government shouldn’t be spending a dime on the Department of Education, which is mostly discretionary spending.

When it comes to the other side of the discretionary spending coin—military spending—Rogers parrots the standard GOP line that sequestration would be “disastrous.” That’s nonsense. Perhaps Rogers is worried that cuts to the bloated military budget will crimp his ability to dole out the goods to defense contractors back in his district (see, for example, Rogers’s $17,000 drip pan).

That leads to Rogers’s most galling comments. When asked about earmarks, the “Prince of Pork” bemoaned his alleged inability to help shovel taxpayer dollars to his district since the practice was halted two years ago. Rogers said that “it hurts me that I can’t advocate for that governmental unit that’s in some desperate need.” What hurts me is that Rogers has to nerve to cite the Constitution to justify legislative earmarking (i.e., Congress’s “power of the purse”). As my colleague Roger Pilon and I have noted, the debate over the power of the executive versus that of the legislative branch to spend is constitutionally relevant and important. As Roger says, however, “it’s the growth of spending, most on matters unauthorized by the Constitution that is far and away the larger problem.” Federal subsidies to state and local governments largely belong in the unauthorized category.

House Appropriations Chairman Behind Military Pork

After the Republicans took back control of the House following the November 2010 elections, the GOP leadership went with Kentucky Rep. Hal Rogers—a.k.a. “The Prince of Pork”—to chair the powerful House Appropriations Committee. I wrote at the time that “The support for Rogers from House Republican leaders is a slap in the face of voters who demanded change in Washington.”

I haven’t changed my mind.

A recent article in the New York Times offers up another reminder that the 30-year House veteran’s priority is to funnel taxpayer money back to his district—not downsize the federal government:

In the 1980s, the military had its infamous $800 toilet seat. Today, it has a $17,000 drip pan. Thanks to a powerful Kentucky congressman who has steered tens of millions of federal dollars to his district, the Army has bought about $6.5 million worth of the “leakproof” drip pans in the last three years to catch transmission fluid on Black Hawk helicopters. And it might want more from the Kentucky company that makes the pans, even though a similar pan from another company costs a small fraction of the price: about $2,500…The Kentucky company, Phoenix Products, got the job to produce the pans after Representative Harold Rogers, a Republican who is now the chairman of the House Appropriations Committee, added an earmark to a 2009 spending bill. While the earmark came before restrictions were placed on such provisions for for-profit companies, its outlays have continued for the last three years.

According to the Times, Phoenix Products’ president and his wife have been “frequent contributors” to Rogers’s political committee and the company has spent at least $600k on a DC lobbying firm since 2005. Those efforts apparently haven’t gone unrewarded as Rogers “has directed more than $17 million in work orders for Phoenix Products since 2000.”

Readers should keep this story in mind the next time a Republican member of Congress calls for a Balanced Budget Amendment, complains about the growth in government under Obama, and then argues against “dangerous defense cuts.” The bedtime story that Americans often hear is that the federal government must spend gobs of money on defense in order to “keep us safe from our enemies.” I once believed that story—and then I spent some time in the U.S. Senate watching policymakers treat military spending like any other pot of taxpayer money.

[See here for more on downsizing the Department of Defense.]

‘Even Though Earmarks Are Gone, There Are Still Billions of Dollars Available’

That quote from a local government official in California sums up why banning earmarks won’t do much to rein in the size and scope of the federal government. The quote comes from a McClatchy Newspapers article on lobbying expeditions to Washington undertaken by local government officials who want federal taxpayers to pick up the tab for projects in their backyards.

From the article:

[Fresno County supervisor Henry] Perea has joined 19 other Fresno County business, academic and political leaders in this week’s three-and-a-half day lobbying venture on behalf of transportation and other projects. Separately, a four-member delegation from the Merced County city of Livingston also is on the prowl.

Billed under the unifying ‘One Voice’ banner, the Fresno County wish list ranges from a transportation bill that might help improve State Route 99 to assistance with controlling air pollution and streamlining environmental reviews for roadwork…

Underscoring the potential regional competition, four representatives from Livingston are separately making the rounds this week in their own search for federal assistance.

‘We want to hit up some congressmen,’ Livingston Mayor Rodrigo Espinoza said Monday.

Federal grants, too, are part of the Livingston delegation’s agenda, with city officials targeting a variety of potential opportunities, including funding, to help nurture a downtown cultural arts district.

If local officials in Livingston want funds for a cultural arts district, then they should be traveling around Livingston “hitting up” local taxpayers to pay for it. But with “billions of dollars” available in Washington, why would Livingston officials take the politically unpleasant route of asking their voters to foot the bill? Of course, federal policymakers are typically only too happy to oblige because they’ll get to attend the ribbon cutting ceremony and brag about their ability to bring home the bacon. Meanwhile, the federal taxpayer continues to get soaked, the government’s debt mounts, and the Beltway Neros fiddle.

Bring home the bacon? But isn’t there an earmark ban? There is, but the programs that policymakers were earmarking money from still exist. That means that the federal dollars continue to flow; the only thing that changed is the course of the river. An earmark ban is good, but as I’ve repeatedly discussed, earmarks are only a symptom of the problem.

So let me make a suggestion to reporters: the next time you’re interviewing a federal policymaker who supports keeping the ban on earmarks, ask them if their staffers are helping the folks back home obtain federal grants, loans, etc. When they respond in the affirmative but argue that they’re merely making sure that their constituents receive their “fair share” of the loot, ask them how the federal government is supposed to get its finances in order if policymakers won’t stop putting parochial concerns ahead of the national interest. You might have to keep pressing, but eventually the hypocrisy will expose itself.

See this Cato essay for more on federal subsidies to state and local government.

Earmarks are a Symptom of the Problem

A Washington Post investigation identified dozens of examples of federal policymakers directing federal dollars to projects that benefited their property or an immediate family member. Members of Congress have been enriching themselves at taxpayer expense? In other news, the sun rose this morning.

According to the Post, “Under the ethics rules Congress has written for itself, this is both legal and undisclosed”:

By design, ethics rules governing Congress are intended to preserve the freedom of members to direct federal spending in their districts, a process known as earmarking. Such spending has long been cloaked in secrecy and only in recent years has been subjected to more transparency. Although Congress has imposed numerous conflict-of-interest rules on federal agencies and private businesses, the rules it has set for itself are far more permissive.

Lawmakers are required to certify that they do not have a financial stake in the actions they take. In the cases The Post examined, not one lawmaker mentioned that he or she owned property that was near the earmarked project or had a relative who was employed by the company or institution that received the earmark. The reason: Nothing in congressional rules requires them to do so, and the rules do not address proximity.

With the fox guarding the henhouse, the most one can hope to accomplish is to limit the carnage. Many pundits, politicians, and policy wonks argue that a permanent ban on earmarks would be an effective limit. Unfortunately, that’s just wishful thinking as earmarks are merely a symptom of the real problem: Congress can spend other peoples’ money on virtually anything it wants.

Take the example of Rep. Candace Miller (R-MI):

In Harrison Township, Mich., Rep. Candice S. Miller’s home is on the banks of the Clinton River, about 900 feet downstream of the Bridgeview Bridge. The Republican lawmaker said when she learned local officials were going to replace the aging bridge, she decided to make sure the new one had a bike lane.

“I told the road commission, ‘I am going to try to get an earmark for the bike path,’” Miller said, recalling that she said, “If we don’t put a bike path on there while you guys are reconstructing the bridge, it will never happen.”

A member of the House Transportation Committee, Miller in 2006 was able to secure a $486,000 earmark that helped add a 14-foot-wide bike lane to the new bridge. That lane is a critical link in the many miles of bike paths that Miller has championed over the years. When the bridge had its grand reopening in 2009, Miller walked over from her home.

“People earmark for all kinds of things,” she said. “I’m pretty proud of this; I think I did what my people wanted. Should I have told them, ‘We can never have this bike path complete because I happen to live by one section of it’? They would have thrown me out of office.”

Forget how the federal money made it to Harrison Township, Michigan. As I’ve discussed before, the more important concern is that the federal government is funding countless activities that are not properly its domain:

There just isn’t much difference between the activities funded via earmarking and the activities funded by standard bureaucratic processes. The means are different, but the ends are typically the same: federal taxpayers paying for parochial benefits that are properly the domain of state and local governments, or preferably, the private sector. As a federal taxpayer, I’m no better off if the U.S. Dept. of Transportation decides to fund a bridge in Alaska or if Alaska’s congressional delegation instructs the DOT to fund the bridge.

As a taxpayer, it disgusts me that Rep. Miller steered federal dollars to a project in her district that she personally benefited from. But would I be any better off had the money for a bike path in Harrison Township, Michigan come from a grant awarded by the Department of Transportation?

If Harrison Township wanted a bike path, then it should have been paid for with taxes collected by the appropriate unit of local government. Better yet, a private group could have raised the funds. Either way, I don’t see how it’s possible to argue that the U.S. Constitution gives Congress the authority to spend taxpayer money on such activities. Invoking the General Welfare Clause doesn’t pass the laugh test as the bike path obviously doesn’t benefit the rest of the country. The Commerce Clause? Please.

For more on why the federal government should stop subsidizing activities that are properly the domain of the state and local government, see this Cato essay on fiscal federalism.

White House Backs Off of Obama Earmarks Pledge

In the state of the union speech last night, President Obama said with great force:

[I]f a bill comes to my desk with earmarks inside, I will veto it.

This appeared to settle the earmark question once and for all. The Republican House and Republicans in the Senate had already sworn off earmarks. Senate Democrats, who may have been holding out hope for preserving this prerogative, will not get to do earmarks. So says the president of the United States, veto pen in hand.

But late last night the White House may have begun to modify the president’s pledge. A “government reform factsheet” circulated by White House staff says, “The President intends to veto bills with special interest earmarks.” (emphasis added) This appears to create a class of earmarks that will bring the president’s veto, special interest earmarks, and a class that will not—national interest earmarks, one supposes.

Defining what is an “earmark” is difficult, though not impossible, as the groups that have worked on the earmarking problem can tell you. But the distinction between “special interest earmarks” and “national interest earmarks” appears to be something the president would make for himself. This withdraws a great deal of force from the “no earmarks” pledge.

It’s certainly possible that the “special interest” language in the fact sheet is surplussage simply meant to illustrate that earmarks are a “special interest” problem. But we will have to watch and see whether the president walks away from his statements about controlling earmarks, as he has done before.

Earmarks and Federal Grants

Federal taxpayers helping foot the tab for renovations to a local wine bar? It sounds crazy, but that’s par for the course with HUD’s Community Development Block Grant program.

A Connecticut newspaper recently ran an article on CDBG money being used to spruce up storefronts in the town of Putnam:

The Small Cities Community Development Block Grant money slated for Cohen’s building comes shortly after a similar grant project finished across the street, said Economic Development Director Delpha Very.

Facade improvements to the Glimpse of Gaia florist, Pangaea Wine Bar and Panache consignment shop finished last month, said building owner Sean Marchionte, of Providence-based Blue Dog Investments.

The building’s owner – go figure – thinks it’s just great:

“It’s very encouraging when you get help from the town. That’s what helps developers like myself make improvements to our buildings, attract tenants and keep the economic ball rolling in the right direction,” he said.

First, the help came from federal taxpayers – not the town. Second, robbing from Peter to pay Paul, which is what federal grant programs accomplish, does not keep the “economic ball rolling.”

The building owner either does not recognize – or does not care – that when the government picks winners, it also creates losers. And as is unfortunately all too common when it comes to local reporting, the uncritical nature of article results in a de facto press release for the economic planners in Washington.

Last week I discussed why it’s time to move beyond the anti-earmark crusade. As I explained, earmarks are a symptom of a deeper problem: the existence of programs that enable the federal government to spend money on properly local activities:

There just isn’t much difference between the activities funded via earmarking and the activities funded by standard bureaucratic processes. The means are different, but the ends are typically the same: federal taxpayers paying for parochial benefits that are properly the domain of state and local governments, or preferably, the private sector. As a federal taxpayer, I’m no better off if the U.S. Dept. of Transportation decides to fund a bridge in Alaska or if Alaska’s congressional delegation instructs the DOT to fund the bridge.

In a related op-ed, I cited the example of the $8 billion CDBG program, which provides grants to localities for a range of development projects such as parking lots, museums and street repairs – the same sorts of activities that members of Congress are fond of funding with earmarks:

Just as earmarks have achieved notoriety for wasteful and ineffective spending, community development programs funded through traditional means have had the same problem…

Even if CDBG funds went entirely to “worthy” projects, federal funding is still an inefficient way to foster local economic development because of the excessive bureaucracy that results from funneling money through multiple levels of government.

Federal administration costs are about 5 percent of the value of CDBG grants, with local and state governments taking a 17 percent and 8 percent cut, respectively. A large share of the CDBG budget disappears before any actual work is done.

See this Cato essay for more on community development programs at HUD, including the CDBG program.

Getting Beyond the Anti-Earmark Crusade

As a former adviser to one of Congress’s most ardent foes of earmarking, Sen. Tom Coburn (R-Okla.), I’ve served time on the front-lines of the battle to end the corruptive practice. Yet, I never felt quite comfortable about the mission. At the same time I was assisting the senator in his floor battles against the likes of ex-Sen. Ted Stevens (Porker-AK), some of my other colleagues had been instructed to help Oklahomans get “their fair share” of subsidies from various federal grant programs.

There just isn’t much difference between the activities funded via earmarking and the activities funded by standard bureaucratic processes. The means are different, but the ends are typically the same: federal taxpayers paying for parochial benefits that are properly the domain of state and local governments, or preferably, the private sector. As a federal taxpayer, I’m no better off if the U.S. Dept. of Transportation decides to fund a bridge in Alaska or if Alaska’s congressional delegation instructs the DOT to fund the bridge.

Therefore, earmarking is a symptom of the problem. The problem is the existence of programs that enable the federal government to spend money on parochial activities. I recently made this point in an op-ed on earmarking:

Critics of the Republicans’ earmark ban have a point when they argue that it won’t save a lot of money. While the tawdry and often questionable uses of earmarked money draw a lot of attention, it represents less than half of 1% of total federal spending.

Yes, earmarking greases the skids for bigger spending and more intrusive government. Policymakers are more willing to support a particular piece of legislation if it contains goodies for their district or state. But earmarked money almost always comes from federal programs that are themselves constitutionally and practically dubious.

In the wake of the earmarking ban by Republicans, much of the debate has centered on the propriety of Congress abdicating its “power of the purse” to the executive branch. This argument is largely irrelevant considering that Congress long ago delegated much of its decision-making power to the executive branch. The delegation was necessitated by the explosion in the size and scope of the federal government: there simply aren’t enough hours in the day for Congress to divvy up the gigantic sack of loot.

As an instructive article in the New York Times explains, eliminating earmarks won’t even stop policymakers from using their pull to steer federal funds toward parochial interests. Policymakers will just send letters to federal agencies (“lettermarking”) requesting targeted funding or call agencies (“phonemarking”) with their requests. Agency officials have an incentive to comply because policymakers determine their budgets.

Congressional Republicans have finally figured out that opposing earmarks is good politics, which explains the magic change in heart by earmarking kingpins like incoming House Appropriations Committee chairman Hal Rogers (R-Ky.). But if Republicans are really serious about reining in the size and scope of the federal government, they’ll go after the parochial programs that make earmarking possible. Therefore, tea party types and others concerned with runaway federal spending would be wise to hold Republicans accountable for the federal spending ends rather than the means.

Update: Per a helpful note from my colleague Roger Pilon, I should clarify that the debate over the power of the executive versus that of the legislative branch to spend is constitutionally relevant – and important. Roger does a much better job of making my point in the following blog post:

To be sure, there’s enough mischief at both ends of Pennsylvania Avenue to go around, but it’s the growth of spending, most on matters unauthorized by the Constitution, that is far and away the larger problem. McConnell calls for congressional oversight “to monitor how the money taxpayers send to the administration is actually spent.” Far more important will be hearings to determine whether Congress has constitutional authority to appropriate money on any particular matter in the first place.

Thus, the new Congress needs to see through the false alternative the earmarks debate has engendered. At bottom, it’s not a question of whether Congress or the president shall decide. Rather, after administration input, all but ministerial spending decisions belong to Congress — as constrained by the Constitution. Thus, if the voice of the electorate is to be respected, new and old members alike need to attend first to their oath of office.

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