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Executive Summary #1266es

April 2, 1999

Executive Summary: How Congressional Earmarks and Pork-Barrel Spending Undermine State and Local Decisionmaking

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For as long as governments have existed, they have used their power to tax and spend to favor certain constituencies with special benefits. In a democracy, elected officials generally have well-defined, geographic-specific electoral bases, so these benefits often include location-specific projects like courthouses, highways, airports, and prisons. Traditionally known as congressional "pork," this type of spending manifests itself most commonly as a specific line item, or "earmark," in an appropriations bill. Both the media and the public tend to associate "pork" with highway spending, but earmarking is used throughout the federal budget; no program area is spared.

Today, pork-barrel politics is characterized by a meteoric growth in the number of earmarks. Although the increase in the number of earmarks has been rising since 1985, the growth appears now to be accelerating rapidly: The number of earmarks in five of the 13 annual appropriations bills doubled between fiscal year 1998 and FY 1999. If allowed to continue, this trend will undermine the patterns of federalism that traditionally have defined the relationship among America's three levels of government.

Public criticism of pork-barrel spending focuses generally on the outrageous and humorous waste that such earmarks sometimes entail. Yet the more troublesome and often overlooked implication of this process is the extent to which these earmarks reflect Washington's growing propensity to micromanage local affairs through its distant bureaucracies. Over 1,000 pork-barrel projects are buried in the 13 appropriations bills for FY 1999, representing a federal rebuke of the competing priorities set by
governors and local leaders far more familiar with the needs of their communities.

Underscoring the point that Washington's earmarks do not necessarily reflect a community's most pressing needs are the findings of a 1994 study conducted by the Congressional Research Service (CRS) on a sample of "demonstration" projects listed in the 1987 and 1991 highway bills. The CRS study concluded that:

For demonstration projects to provide the welfare gains citizens might expect from transportation public policy, they would have to produce outcomes at least as good as those that result from the local, state and regional planning process. Evidence so far suggests that many demonstration projects may have difficulty passing this test.

Not all in Congress are enamored by opportunities to micromanage spending programs. Senator John McCain (R-AZ), a leading congressional opponent of pork, introduced legislation during debate on the highway bill to require that all earmarks be paid for with money from each state's share of the federal transportation trust fund rather than money taken from another state's share. The measure did not pass, but it did raise awareness about potential solutions.

An earlier attempt to control pork-barrel spending occurred in 1995, when the 104th Congress enacted the line-item veto as part of the Republican Party's Contract With America. Taking effect on January 1, 1997, this new veto privilege was used by President Bill Clinton to cancel $355 million in FY 1998 pork-barrel spending, much to the chagrin of many in Congress. Unfortunately, the U.S. Supreme Court took that power away from the President in mid-1998, ruling it unconstitutional.

Absent a legislative remedy, moral suasion represents an alternative that some in Congress have employed in the past to induce some measure of restraint. Although recent attempts to use moral suasion have failed to dampen the use of earmarks, an earlier effort by senior members of the House Appropriations Committee appears to have had some success in several appropriations accounts. In 1993, Representatives William H. Natcher (D-KY) and George E. Brown, Jr. (D-CA), then chairmen, respectively, of the House Appropriations and House Science Committees, worked to reduce the number of appropriated earmarks for academic institutions, which had risen from seven earmarks in 1980 to 499 in 1992.

With Congress apparently either unable or unwilling to impose such meaningful restraint on its wasteful spending practices, the last best hope for slowing the growth of federal pork-barrel spending may lie with governors and local leaders. Because their communities pay the price for congressional meddling which forces them to accept unwanted projects at the expense of locally determined priorities, governors have every incentive to encourage Congress and the President to curtail such federal micromanagement.

As the 106th Congress gets underway, there will be no shortage of opportunities to show restraint and moderation in federal spending, earmarks, and congressional micromanagement. Chief among them will be the 13 appropriations bills that have to be enacted before September 30, 1999, the end of the current fiscal year. Keeping these bills clean will be a key test of Congress's willingness to honor the historic divisions of responsibility in America's federal system of
governance.

Dr. Ronald D. Utt is Grover M. Hermann Fellow in Federal Budgetary Affairs at The Heritage Foundation.

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