Commentary

A Reality Check on Earmark Reform

By Stephen Slivinski
This article appeared in the January 22, 2007 issue of Business Week.

The new Congress has agreed to take action on earmarks, the budget items best known as “pork projects.” Think, for instance, of the $13.5 million that helped subsidize last year’s World Toilet Summit in Ireland, an expenditure worthy of inescapable jests about fiscal incontinence.

In a mostly party-line 280-152 vote last Friday, the House passed rules changes requiring that both the spending projects and their sponsors be disclosed on the internet at least 48 hours before they are considered on the floor. Congressmen will also be required to justify the public need for the expenditures, and certify that they won’t benefit financially from them.

Nobody can really object to such a reform. It’s certainly a good idea to shed some light on what now-convicted über-lobbyist Jack Abramoff called the “favor factory.” But we should be realistic about what these reforms can achieve. The impact is likely to be minimal.

For starters, some supporters of the change hope the number of egregious earmarks will fall because members of Congress will be too ashamed to attach their names to them. But as anyone who’s driven over Senator Robert Byrd Bridge can imagine, the problem isn’t that members of Congress don’t want their names affiliated with most earmarked projects. It’s that so many of them do.

In the past, numerous congressmen could often take credit for a single project. There was no official way to verify who was really the main supporter of the earmark. Now there is. Think of it as intellectual property protection for government waste. And just as intellectual property protection for inventions presumably creates an incentive to innovate, earmark transparency might also lead to a rise in the number and cost of earmarks.

Before, you’d often be able to figure out what congressman was tied to which earmark. The 2005 highway bill, for instance, included specific earmarks for particular cities or roadways. Some line items in the bill went so far as to identify a specific highway exit number. Any savvy reporter sitting down with a road map and a congressional district map could discover which congressman likely delivered the earmark. Yet even that fledgling form of transparency didn’t have an overall effect on the amount of pork in the bill. Once the “Bridge to Nowhere” in Alaska was exposed and soon became synonymous with wasteful road projects, the representatives from Alaska – particularly Senator Ted Stevens – never flagged in their support of it.

Even if transparency leads to fewer earmarks, there are no promises that these projects won’t reappear in other ways and other places. The congressional budget process is nothing if not a game of reinvention. You could call spending items Happy Funtime Projects instead and sock them away in another part of the budget, but they will remain the coin of the realm on K Street.

Of course, Congress could simply give a bucket of money to an agency with no strings attached. But then a member of the Appropriations committee would write a letter to the department head that read something like, “Gee, wouldn’t it be nice if Project X got some of this pot of money?”

Can you really blame a department head who reads a letter like that – from a member of Congress who controls his budget and oversees his agency – and obliges? It would strike anyone in that position as similar to Tony Soprano walking into the corner grocery store you own and saying, “Nice little place you got here. Damn shame if anything were to happen to it.”

So we probably won’t soon see an end to handouts like the half-a-million in taxpayer funds that went to the Sparta Teapot Museum in North Carolina in 2005. Earmark transparency is merely a beginning. A good first step for sure, but hardly the endgame of fundamental budget reform. Future reforms should create an incentive to actually reduce the scope of government overall. In the meantime, it’s important to remember that as long as a culture of spending persists in Washington – fueled by a budget process that allows Uncle Sam to be all things to all people – then no matter who is in power, earmarking in some form will always be with us.