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Executive Memorandum #194 on Federal Budget

April 8, 1988

April 8, 1988 | Executive Memorandum on Federal Budget

How Drug Smugglers Gain from Coast Guard Budget Games


(Archived document, may contain errors)

4/8/88 194

HOW DRUG SMUGGLERS GAIN FROM COAST GUARD BUDGET GAMES

The U.S. Coast Guard captured public attention last February by declaring that it is cutting back its drug e nforcement activities by 55 percent. Tle reason, say Coast Guard officials, is a shortage of funds. Tle program being cut has been extremely effective and popular and last year confiscated 13,000 pounds of cocaine and arrested 624 drug smugglers. What is c urious is that while the Coast Guard is strapped for funds to fight drug smugglers, it seems to have plenty to continue providing its non-emergency towing services free-of-charge to wealthy yacht owners out of some of the same ports where drug abatement a ctivity has been sharply curtailed. In addition, it maintains buoys and other navigational aids rather than contracting out that entire function to the private sector. And it owns prime real estate in many ports.

What the Coast Guard apparently is doing is holdingits vital drug- interdiction programs hostage as it tries to get more funds from the Reagan Administration and Congress. Unfor- tunately the Reagan Administration, in requesting an additional $60 million to restore Coast Guard anti-drug services, has allowed itself to fall into a trap laid by Congress and agency bureaucrats who wish to bust last year's budget summit agreement. ,

Shutting the Washington Monument. The Coast Guard is resorting to a budget tactic known as'The Washington Monument Ploy." This is an all too common game of political blackmail where an agency, when faced with budget cuts, claims that it will have to eliminate its most valu- able or popular services. The National Park Service, for instance, might threaten to close down the W a shington Monument if Congress points its budget knife in the agency's direction. The aim, of course, is to trigger a public outcry that forces Congress to retreat and allows,the agency to keep all its money. By insisting on slashing meat, federal agencies have found that they often escape from the need to trim fat. This is what the Coast Guard is doing. In response to a mere 5 percent reduction in its $2 billion budget, the Coast Guard is slashing over half of its drug patrols. Tle Coast Guard should not b e allowed to use America's justified concern with the drug problem as a ruse to preserve its budget. Rather than requesting more money, the Reagan Administration should be pressing Congress to allow an overhaul of Coast Guard priorities, permitting the Coa st Guard to introduce user fees, speed up contracting out, and sell its real estate, using resulting savings and revenues for anti-drug sinaggling activities.

Much of the blame for this artificial Coast Guard budget crisis must rest with Congress, however. Last yea 'r lawmakers redirected $ 100 million of the Coast Guard's budget to low priority transportation programs, such as Amtrak and parochial Federal Highway Administra-

tion road projects. They did this with the intention of later passing a $100 mi llion supplemental appropriation that would give the Coast Guard all of its original funding request. Last year's budget summit agreement, however, confers to the President absolute veto power over such ad- ditional spending measures. Congress can only pa s s a supplemental if the President declares a budget emergency. Under no circumstances should the President do so. If the Coast Guard must have more funds, Congress could raise $300 million per year easily by imposing user fees on commercial and recreation a l boaters for its non-emergency services, as proposed by the 1983 Grace Commission and in 1984 by the General Accounting Office. In addition, it could raise millions of dollars immediately by selling valuable land holdings - if only Congress would allow i t to use this money for improved drug interdiction. But Congress preferred to in- vite Coast Guard bureaucrats to plead poverty and hold drug enforcement hostage to more funds. Unfortunately, the Administration is willing to do so.

Common Tactic. Yielding to Coast Guard pressure, the Department of Transportation (DOT) recently requested Congress to "reprogra&'$60 million of DOT funds from such agen- cies as Amtrak and the Federal Highway Administration to the Coast Guard budget. But was- teful spending in t hese other DOT agencies should be canceled through a presidential rescission request, not by shifting the funds to the Coast Guard. Moreover, this action in es- sence would reward the Coast Guard for using the "Washington Monument Ploy." It also reflects the White House's failure to take firm action against Executive Branch agencies that resort to this ploy. The result: the tactic has become very common.,

Representative Richard Armey, the Texas Republican, has won majority support for his amendment to the recently passed House Budget Resolution. It would require the Coast Guard to transfer to the private sector all non-emergency rescue operations in known drug smuggling areas. All resulting budget savings would be used to expand Coast Guard "law enfor- cem e nt, military readiness, and emergency search and rescue functions." In a time of budget restraints, the Armey Amendment allows the Coast Guard to use its resources for the most im- portant national needs, pressuring the agency to return to its primary res p onsibility of enforc- ing the law and ensuring the safety of the seas, rather than serving the special interests of the boating industry. The Reagan Administration thus should prohibit the Coast Guard from spending any more money on non-emergency search a n d rescue activities until it fully reac- tivates its drug enforcement program. The White House should reprimand the Coast Guard for exploiting the nation's drug crisis as a way to avoid trimming the Coast Guard budget. And the White House should order the Coast Guard to restore full funding to drug interdiction and to exercise sound management skills to pare fat and inappropriate functions from the Coast Guard budget. Stephen Moore Grover M. Hermann Fellow in Federal Budgetary Affairs

F or further informatio n: Philip E. Fuder, Jr., "Privatizing Coast Guard Services," Citizens for a Sound Economy Issue Analysis No. 7, November 22,1985. President's Private Sector Commission on Cost Control, Task Force Report on Pfivatization (Washington, D.C.: Government Print ing Office, April 1983), pp. 181-197. General Accounting Office and Congressional Budget Office, "Analysis of the Grace Cominission's Major Proposals for Cost Control," 1984, pp. 212-214.

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