Tag: Earmarks

Earmarked for Corruption

Florida Times-Union reporter Matt Dixon deserves kudos for his detailed exposé of Congresswoman Corrine Brown’s (D-FL) corruption-tainted earmarking. Since 2008, Brown has sought millions for a non-profit in Jacksonville that employs a lobbying outfit that just happens to have Brown’s daughter Shantrel on its staff.

Brown and her daughter have tried to secure $1.1 million for “streetscape improvements and renovations” at a plaza leased by the non-profit. Rep. Brown is currently requesting a direct appropriation of $1 million for it, but interestingly says on her website that “I certify that neither I nor my spouse has any financial interest in this project.” Okay, but what about her daughter?

As the article explains, this isn’t the first time the Browns have collaborated at taxpayer expense:

The Community Rehabilitation Center is not the only client of her daughter’s that Brown has helped.

In 2006, she traveled to the Republic of Georgia shortly before natural gas importer Itera had stopped supplying portions of the country with gas due to $6 million in non-payments. Over an eight-month period that year, Itera paid Shantrel Brown and one other Alcalde and Fay lobbyist more than $80,000 to work on “international debt issues,” lobbying reports indicate.

The Russian company, which has its U.S. headquarters in Jacksonville, has filed 31 separate federal lobbying reports since 2005. It used Shantrel Brown only during the eight months in 2006.

In a separate 1999 incident involving her daughter, Brown was investigated by an ethics subcommittee after a $50,000 Lexus purchased by African banker Karim Pouye wound up registered in Shantrel’s name. Corrine Brown had lobbied to keep Pouye’s boss, West African millionaire Foutanga Dit Babani Sissoko, out of federal prison after he was accused of stealing $240 million from a bank in the United Arab Emirates. The money wound up in Miami bank accounts controlled by Sissoko. The subcommittee took no action, but in its written report was critical of the Lexus.

According to the article, the non-profit had $4.6 million in total revenue in 2009. Of that amount, $2.1 million came from Medicaid and another $1.6 million came from “government contributions.” Where the money is going should raise eyebrows:

In [2008 and 2009], employee salaries made up nearly 40 percent of the center’s overall expenses. In 2008, $1.6 million of the center’s $4.5 million in total expenses was tied to salaries. The following year, the salary number jumped to $1.8 million of the center’s total $4.5 million in expenses. It is unclear how many employees the Community Rehabilitation Center employed during those years.

As a Cato essay on special-interest spending explains, earmark apologists are wrong when they argue that earmarks aren’t a big deal since they constitute a tiny portion of overall federal spending:

The problem is that earmarking has contributed to a general erosion of fiscal responsibility in Washington. Earmarks have exacerbated the parochial mindset of most members of Congress, who spend their time appeasing state and local interest groups rather than tackling issues of broad national concern. Many politicians complain about the soaring federal deficit, yet their own staff members spend most of their time trying to secure earmarks in spending bills.

Corrine Brown takes this parochial mindset to a new level by using her power to enrich her own family at taxpayer expense.

Earmarkers Work to Penalize Earmark Opponents

Political gamesmanship has never seen a clearer illustration than in this CQ Politics article, “Locals Split on DeMint’s Earmark War.”

South Carolina Republican senator Jim DeMint opposes earmarks. Fellow South Carolina Republican Lindsey Graham supports earmarks and regularly requests them. (See a list of all 136 of his earmark requests for FY 2010 here.) 

Senator Graham’s request for a $400,000 earmark for the Port of Charleston hasn’t been awarded—perhaps because of DeMint’s opposition to earmarks.

Refusing to go along has a price. And in the article it’s a Republican operative who sinks the first shiv, suggesting that DeMint’s failure to earmark hurts South Carolina.

“What you’re hearing [in the state] is: the ideology of the tea party and catering to that movement will come at the expense of jobs in South Carolina,” said Chris Drummond, a South Carolina GOP strategist who formerly worked for Gov. Mark Sanford.

(Think a Republican wouldn’t criticize another Republican? Think again.)

The tax money used for earmarking is paid into the federal kitty by South Carolinians, of course. Getting some of the taxes they pay returned to the state is not the benefit it appears. If their money were left with them in the first place, they would spend it as they see fit, benefitting South Carolinians and their state much more than politically directed spending.

Next, Senate appropriation subcommittee chairman Byron Dorgan (D-ND) exploits the tension among members of his opposite party, clinical analysis masking his glee: “ ‘In cases where you have a state where one asks for an earmark, the other opposes all earmarks, that makes it a more difficult project to fund,’ he said.”

Then comes payback time. Senator Robert Bennett (R-UT) was ousted during the primary by a Tea Party/DeMint-favored candidate, so:

The office of subcommittee ranking member Robert F. Bennett (R-Utah) also told the Greenville News that the port was denied funding in part because “there was no request at all from Sen. DeMint.”

The article recites a number of other viewpoints on earmarking and earmarks in South Carolina, but the highlight is the parade of assailants on DeMint. Politics ain’t patty-cake, and earmark politics are no exception.

Taxpayers Against Earmarks Makes its Debut

Taxpayers Against Earmarks is a new effort to rid the federal legislative process of some of its most acute horse-trading: earmarks. Find it at the cleverly named URL, EndingSpending.com.  

There’s little doubt that many spending earmarks are part of a subtle—or not-so-subtle—quid pro quo in which federal legislators buy votes by directing funds to favored home-state or home-district interests. Taxpayers Against Earmarks has a well-produced web site that invites people to sign up and join the anti-earmark effort.

Earmarked spending is a small part of the overall budget, of course, but earmarking is emblematic of the “favor factory” that Congress has become as the federal budget and federal power have bloated. Federal spending is appropriate in the small number of cases when it provides national public goods that benefit the country as a whole, but refurbishing local museums, funding projects at state universities, and requiring the military to buy from a particular defense contractor do not benefit the general welfare. Taxpayers Against Earmarks is working to begin the process of getting federal spending under control.

Bingaman Gets Paid to Flout Disclosure Rules

Judging by his earmark disclosures, Senator Jeff Bingaman (D-NM) seems to have said “To hell with you!” to the Senate Appropriations Committee and its earmarking rules. But the committee is doling out money to him anyway. It seems rules were made to be broken.

In March, the committee issued a press release reiterating its rules about earmarks—funding requests for special projects that go into Congress’ annual spending bills. Among other things, the rules say:

The Appropriations Committee will consider no request for spending on congressionally directed items … unless a description of the items proposed—including their purpose, location, the recipient of the funds, and an explanation of why the spending is in the interest of the taxpayers—is made publicly available on the Senator’s office website…

bingaman earmark disclosureTake a look at Senator Bingaman’s earmark requests [ugly PDF image] for the Energy & Water appropriations bill. It’s a day-late, dollar-short disaster! (Bingaman’s disclosures for other approps bills are collected here.)

Take one funding request, identified only as “Central NM 593.”

The location of the project is “Bernalillo, Valencia, and SandovaNM1 [sic] Counties.”

Its purpose and benefit to taxpayers? Just two words: “Water Supply.”

Nowhere does Senator Bingaman say who will receive the money. It’s something taxpayers might like to know, and the Senate Appropriations Committee requires its disclosure.

Based on that justification, Senator Bingaman got a million dollar payout. A million dollars for a two-word justification!

(There’s another that asks for funding in the amount of ‘8.00%’. What does that even mean?! Luckily it wasn’t funded…)

Senator Bingaman’s disclosure for the Energy & Water approps bill is just three pages long. Three pages cover 65 earmark requests, adding up to over half a billion dollars (and eight percent of something). Can a half-billion dollars in spending be justified in under three pages?

This should have received a “Stop—Do Not Pass Go—Do Not Collect $200” from the Senate Appropriations Committee. He obviously flouted their rules, denying the public visibility into his earmark requests as the committee required.

But Senator Bingaman got 14 earmarks in the Energy & Water bill, worth over $16 million. That’s $16 million for three uninformative pages.

This is transparency done wrong.

S. 3335 is a bill to require Congress to produce a database of earmark requests and earmarks. It has been reported to the full Senate by committee.

Federal Spending Transparency: Unlocking the Power of Abstraction

I’ll present a short paper and lead some discussion on federal spending transparency today at an OMB Watch conference entitled “Strengthening Federal Spending Transparency: A Working Conference to Develop a Plan of Action.”

My paper is called “Federal Spending Transparency: Unlocking the Power of Abstraction.” It builds on lessons I learned from developing the Earmarkdata.org model aimed at getting earmark information out of Congress.

Information scientists will find the paper amateurish and riddled with imperfections. Policy people will find it obscure and dense. That’s what you get when you translate between two languages and cultures.

The goal:

Each piece of the policy making process—the budgets, bills, votes, etc.—should originate as structured data, feeding directly into the information infrastructure that the transparency community creates. A budget should come out not just in paper and PDF versions, but as a data set containing all the meaning that exists in the physical documents.

Make sense? If not, you’ll want to get yourself to where it does.

Congress to Produce Earmark Data?

A bill introduced in the Senate yesterday would require Congress to bring earmarks out of the shadows, producing earmark data in a format that the public can easily use.

S. 3335 calls for a “unified and searchable database on a public website for congressional earmarks.” This is something President Obama called for in his 2010 State of the Union speech, though we haven’t heard much more from him about it since then.

Importantly the bill is not just about a web site. The bill would enable the public to “programmatically search and access all data in a serialized machine readable format via a web-services application programming interface.” That gobbledegook means that people could access the data for themselves, slicing and dicing it to learn whatever they want or to display it however they want.

I’ve noted here before the efforts of my government transparency web site WashingtonWatch.com to capture earmark data and the related effort to get earmark data directly from Congress at Earmarkdata.org.

The bill was introduced by Senator Tom Coburn (R-OK), and is currently cosponsored by Sen. Michael Bennet (D-CO), Sen. Barbara Boxer (D-CA), Sen. Bob Corker (R-TN), Sen. John Ensign (R-NV), Sen. Russ Feingold (D-WI), Sen. Kirsten Gillibrand (D-NY), Sen. Johnny Isakson (R-GA), Sen. John McCain (R-AZ), and Sen. Mark Udall (D-CO). Its House counterpart is H.R. 5258 (Cassidy R-LA), which also has bipartisan support.

Support for these bills across parties and ideologies suggests good things may be in store for earmark transparency.

Do Earmarks Crowd Out Local Private Investment?

The extent to which government spending either complements or crowds out private investment has long been one of the most heated debates in economics (and politics).  Generally economic theorists posit that an increase in government spending drives up interest rates, which increases the cost of private investment, accordingly reducing such investment.  Most macroeconomic models are build on this relationship. 

In an interesting new working paper, a trio of economists attack the question from a different angle.  They measure the impact of increased earmarks on the local economy receiving those earmarks, and compare the impact to areas not receiving the increased earmarks, which allows them to control for the overall macroeconomic environment.  Their finding: even in a setting where government spending is “free” to the recipients (but not free to the rest of us), such spending reduces private investment. 

More specifically, the authors examine what happens to a state when one of its senators becomes a chair of a powerful committee.  First, the obvious, upon taking a power chairmanship, the value of earmarks increase almost 50%.  This results in roughly a $200 million annual increase to the state.  But the authors find this is not simply a transfer from the rest of the country to the state, it also depresses private capital investment and R&D spending in the state.  On average, once a state has a senator obtain a powerful chairmanship, state level private investment in capital expenditures decreases $39 million annually and state private R&D decreases $34 million annually. 

For states seeking to get your senator into a powerful chairmanship:  be careful of what you wish for.  There’s no free lunch, even when someone else is paying.