Tuesday, March 10, 2009

This little piggy

In my recent post about the fight against earmarks in the Omnibus bill, I identified three types of spending that could be in that bill (or any other appropriations bill):

1) What we can call “normal” appropriations which appropriate money for ongoing government operations. Through this, for example, the Federal Department of Transportation is given a certain amount of money which it can spend directly or allocate to State Departments of Transportation as provided in existing laws and guidelines. This type of spending accounts for about 98% of the Omnibus bill.

2) Non-pork earmarks which appropriate money for a specific purpose that can reasonably be claimed to benefit the country as a whole or to benefit people across the country. I have not seen any claims that there are these types of earmarks in the Omnibus bill although there may be.

3) Pork-barrel earmarks which appropriate money for a specific purpose that can not reasonably be claimed to benefit the country as a whole or to benefit people across the country. Instead, pork-barrel earmarks benefit mostly a particular State or Congressional district or a particular interest group whose benefit is not also a benefit nationally. Presumably the entire $7.7 billion worth of earmarks that so many people are inveighing against consists of these pork-barrel projects.

I also identified four arguments that could be used to oppose non-pork earmarks and normal appropriations:

1) There is no true benefit to the spending.

2) The cost of the spending outweighs the benefit to be derived.

3) The benefit outweighs the costs but we simply cannot afford it.

4) Federal spending should be cut, period.

If we now turn to pork-barrel earmarks these same four arguments could be used to oppose them but it is usually the first argument - no true benefit - that is employed, primarily by pointing out how ridiculous a particular earmark is or at least sounds. In a fabulous stroke of luck the Omnibus bill contains some literal pork we can use as an example of how the arguments about these types of earmarks usually go:

- Congressman introduces pork-barrel earmark; for example, $1.791 million for swine odor and manure management in Iowa

- Fiscal watchdog groups, the entire opposing party, and every media outlet outside of his own State take him to task for it

- The Congressman and others who understand the need for the requested project explain why is is important; often the explanation is within hailing distance of reasonable (in the case of swine manure it is more than reasonable) and even if it’s not supporters can always point out that this earmark is no more preposterous than other earmarks (water taxis, tattoo removal, etc.)

- The discussion degenerates into an argument over how reasonable the pork-barrel earmark really is and basically becomes, “Is too, Is not”.

If we’re really lucky we eventually get to the “we cannot afford it” argument. Although we should then be able to rationally balance the urgency of the proposed project against the financial condition of the government and the country this is difficult with pork-barrel earmarks because they always look crucial to the proposers and usually look trivial to the opposition.

So much for how things usually go. There are also three other arguments that can be marshaled against pork-barrel earmarks. First, the claim that earmarks are corrupt. This argument is laid out nicely here:

Earmarking in and of itself is not corrupt, although McCain and other critics point to a series of earmark-related scandals that resulted in the prosecution of Congress members. But it does give powerful lawmakers a way to fund projects that they deem priorities without going through the normal appropriations procedure. Some high-powered lobbyists actively seek earmarks for clients, and the lack of public scrutiny fuels fears of shady deals.

In other words, pork-barrel earmarks create the opportunity for sin. This is an argument that makes sense generally but except in the most egregious cases it is difficult to levy a charge of corruption against a Congressman who is requesting something that looks worthwhile. (Hence the frequent reliance on mockery.) In the case of the Omnibus bill, opponents were not successful even in what looks like it may well be an egregious case.

In short, the corruption argument makes sense if you understand that part of keeping a system honest is not providing situations that allow - much less encourage - dishonesty. But it is a hard charge to make stick on a case by case basis and it never plays as well as pointing and laughing.

Second, pork-barrel earmarks are illogical. Recall Weisman’s claim from the prior post:

It’s not that the Congress is piling on additional spending. It’s just carving out the spending that would already be there.

It used to be that a huge pot of money would just go to, say, the Department of Transportation. Then the Department of Transportation would farm that out to State Departments of Transportation or local road authorities and they would decide how to spend the money. It simply would give the bureaucracy more power in deciding how to spend that money.

There are two problems with this. For one, I’m not sure I believe it. Weisman is claiming that the normal appropriations process decides that Bill X will appropriate some amount of money to the Federal Department of Transportation which will in turn give whatever amount is legal and appropriate to the New Jersey State Department of Transportation. One of New Jersey’s Senators decides he wants a pork-barrel earmark of, say, $10 million to repave Route 3. The Appropriations Committee pulls out the White-Out, reduces the Federal Department of Transportation’s funding by $10 million, and slaps on a little sticky note that reads: Give NJ $10M less than you planned. Color me skeptical.

Even if the process really does work this way, I question whether a Congressman sitting in Washington is really better able to prioritize the use of transportation funds in his State than is the State’s Department of Transportation which, presumably, gets paid to know what needs doing now and what can be delayed. According to The Economist, this is McCain’s:

really basic argument: no spending bill should have earmarks for spending that would be better doled out by local authorities.

These two aspects work together to provide a compelling argument. If the amount of money going to a State does not increase due to earmarks then give all the State money in the usual legal manner and let the appropriate State agency decide how to spend it. If earmarks do mean a State gets more money than it would through the normal appropriations process then that is not fair to States which are not in a position to slide earmarks into an appropriations bill. Which brings us to the third argument that can be made against pork-barrel earmarks.

The country as a whole should not be paying for projects that totally or disproportionately benefit a single State. Swine manure management is almost certainly crucial for Iowa but taxpayers in New Jersey shouldn’t have to pay for it. Volcano management is a big deal for Alaska but taxpayers in Iowa shouldn’t have to pay for it. Fruit fly research is essential for Hawaii but taxpayers in Alaska shouldn’t have to pay for it. Preserving part of Old Tiger Stadium is near and dear to every Detroiter’s heart but taxpayers in Hawaii shouldn’t have to pay for it. And College Avenue in New Brunswick, New Jersey, may well need a redesign but why on earth should taxpayers in Michigan pay for it?

Projects that benefit one State should not be funded by taxpayers across the country. I would go further and argue that even projects that benefit multiple States should not necessarily be funded by the entire country. Swine manure management can become a joint venture of Iowa, North Carolina, and Minnesota; together they account for more than 50% of hog revenues in the United States (or did in 2004). Alaska could join with States in the Pacific Northwest to study volcanoes and I imagine California would have as much interest in fruit flies as Hawaii. (I’m afraid Michigan and New Jersey will have to go it alone.)

The argument that taxpayers across the country should not pay for one State’s benefit seems to me to be a matter of basic fairness but since most Congressmen utilize earmarks to benefit their districts, it’s one they may be reluctant to make. More dangerously, this argument has implications for more government spending than just earmark pork-barrel projects. Let’s go back to Weisman’s point: if a State is going to get that money anyhow, why not let the Congressional delegation have some say in how it’s spent? If you accept that one State’s tax dollars should not pay for another State’s sole benefit, the answer is that the premise of the question is invalid: the State should not be getting that money in the first place.

Why is the Federal Department of Transportation handing money to the States? Why should taxpayers in Nebraska pay to maintain the roads in Texas? One could make a reasonable argument that the Federal government should maintain the interstate road system but I cannot imagine a reasonable argument that work on local streets is properly a Federal task. And even the interstate system argument is weak. If you’ve seen the freeways around Houston lately, you realize they have little to do with national evacuation routes and much to do with commuting to work.

When I discussed non-pork earmarks and normal appropriations, I argued that the best way to oppose increases in those was by arguing in favor of a small Federal government. Similarly, I believe the best way to oppose pork-barrel earmarks is by arguing that States should themselves fund the projects which benefit them, not expect the rest of the country to do so. The two ideas complement each other: a smaller Federal government means less Federal spending which means lower taxes which means the States can - if their residents so desire - increase State taxes to fund projects formerly supported by the Federal government whether through normal appropriations or earmarks.

In the end all this comes down to a matter of principles or perhaps ideology. Do you believe that huge government spending, regardless of the impact on the deficit, is the solution to an economy in crisis or do you favor a bare minimum of government assistance? Do you believe taxpayers in one State should pay for projects that benefit taxpayers in another State or do you believe that if a project is really crucial for a State then its own taxpayers will - and should - fund it? And, ultimately, do you favor a large, strong Federal government and weak, dependent States or do you favor a system closer to “dual federalism” in which:

the national and state governments are split into their own spheres, and each is supreme in its respective sphere ... [and] ... there are certain limits placed on the federal government.

There are a number of reasons opponents of the Omnibus bill (and the Stimulus bill before it) have had trouble gaining traction, including Obama’s popularity and the general feeling of fear over the economy. Furthermore, opponents allowed themselves to be distracted by the 2% of spending contained in earmarks.* However, I believe the fact that opponents either do not possess or cannot convincingly articulate a coherent political philosophy in opposition to these bills is a huge part of their problem.

Without basic principles about Federal spending and State’s responsibilities (and, yes, rights) arguments about all spending - normal appropriations, non-pork earmarks, and pork-barrel projects - devolve into “Is not, is too” squabbles over whether or not the spending is needed. This results in the opponents looking wholly negative with no alternative to offer. With those basic principles those saying “no” can offer a different view of the right path instead of just an insistence that we’re on the wrong path which is - let’s face it - less than helpful.


*There are some indications opponents are increasingly focusing on the size of the bill as a whole and not just on the earmarks. One of the problems of focusing on earmarks - besides not seeing the forest for the trees - was that since both Democrats and Republicans indulge in pork-barrel earmarks it was difficult for either party to present itself as a plausible opponent of earmarks.

This is not an insurmountable problem incidentally. As long as earmarks exist any Congressmen who does not attempt to bring home the bacon is disadvantaging the people in his district vis-a-vis people in other districts as well as disadvantaging himself in elections. Thus the appropriate stance for someone who benefits from earmarks but nonetheless opposes them would be that he wants the system to change but until it does he will continue to do his best for his constituency.

Parenthetically, I’ve always thought the handling of earmarks was one of the great failures of the Republican Presidential campaign. John McCain’s “no earmarks” message was undercut by the vast number of earmarks from Alaskan Congressmen. Sarah Palin - or her handlers - tried to counter this by citing Palin’s opposition to specific earmarks like the Bridge to Nowhere. Even leaving aside whether Palin opposed the Bridge in a timely fashion, this was the wrong argument. The right argument was that as long as earmarks exist any state that does not get them is disadvantaging its own residents and that Palin would have been remiss as governor in doing so.


Sources and reading:

Coburn Highlights Billions of Wasteful Spending in Generational Theft Act AKA Senate Stimulus - As the title says, Coburn is talking about the Stimulus bill not the Omnibus bill but this paragraph is in line with my argument about basic fairness in transferring national money to individual States:

We are transferring the irresponsibility we have had over the last 6 years in this Congress--or last 8 years in this Congress--to the States because what we are telling them is: You do not have to be fiscally responsible. You do not have to live within your means because Uncle Sam is going to bail you out. That is what this bill says. We are going to bail them out.

So for the States, such as my State, that were smart enough and wise enough to create a rainy day fund and live within their means, we are going to ask all the taxpayers of all the States that have done that to pay for the exorbitant spending and growth in Government in all the rest of the States.

Do read the whole thing. It’s a fabulous rant.

Obama’s Stunted Economic Stimulus - In an article which approves of a large stimulus, Robert J. Samuelson argues that Obama’s Stimulus bill doesn’t measure up. Part of the reason:

Yet, the stimulus package offers only modest relief [for state and local governments]. ... Congress might have done more by providing large, temporary block grants to states and localities and letting them decide how to spend the money. Instead, the stimulus provides most funds through specific programs. There's $90 billion more for Medicaid, $12 billion for special education, $2.8 billion for various policing programs. More power is being centralized in Washington.

In other words, much stimulus funding to the States is, well, earmarked.

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