June 20, 2007

June 20, 2007 | WebMemo on Federal Budget

Pork-Barrel Spending: Republicans Win Transparency, but $23 Billion Slush Fund Remains

After enduring a week of scathing criticism from taxpayers, grassroots activists, and especially other lawmakers, House Appropriations Committee Chairman David Obey (D-WI) has finally abandoned his earlier plans to keep all pork projects secret from the public and other lawmakers until after the spending bills have passed the House. The new plan is to quickly pass those spending bills that traditionally do not contain pork, such as Legislative Branch appropriations bill, and then wait to debate the other spending bills until the projects have been publicly listed. This will give lawmakers the opportunity to debate and strike individual projects on the House floor. Lawmakers should eliminate not only the pork projects but also a $23 billion slush fund created to finance them.

Republican lawmakers deserve kudos for the victory on earmark transparency. Leadership members such as Minority Leader John Boehner (R-OH), Minority Whip Roy Blunt (R-MO), and Conference Chairman Adam Putnam (R-FL) helped chart the course for reform. Republican Study Committee members, such as Rep. Jeb Hensarling (R-TX), effectively shut down the House floor in order to force the reforms, and the Republican members of the House Appropriations Committee (who are typically supportive of pork), also pushed for reform.

The $23 Billion Slush Fund Remains

President Bush has called on Congress to halve pork-barrel spending from last year's level of $13.3 billion.[1] Using data from Citizens Against Government Waste, that means the President would allow $6.6 billion in pork-barrel spending-a full $23 billion less than the record amount set two years ago. [2]

Interestingly, Congress responded to the President's call by adding $23 billion in new non-defense discretionary spending to the President's request.[3] This additional $23 billion slush fund nearly matches the amount of new spending needed to restore pork-barrel spending to its 2006 peak of $29 billion without any offsets within the programs. Thus, the added spending may have been planned as a slush fund for additional pork-barrel spending.

Transparency will allow taxpayers and lawmakers to see how much of the new spending will go toward pork. But the ultimate goal is to actually eliminate-not just track-pork-barrel spending. Transparency only guarantees that the referee will not rig the legislative game before it begins. Actually winning taxpayer savings requires that Congress use this transparency to remove all pork projects from the spending bills. Lawmakers could save taxpayers $2,400 per household over the next decade by first eliminating all planned pork projects, and then eliminating the $23 billion slush fund that was created to finance the projects.

Why Pork Projects Are Harmful

In the past, Congress created grant programs and either distributed the money to state and local governments by formula or instructed federal agencies to distribute the grants through a merit-based application process. Today, Congress actually determines, within legislation, who will receive government grants by "earmarking" grant money to specific recipients. Earmarks are also known as pork projects.

Earmarking is a corrupting process. Many of the projects are shepherded through Congress by lobbyists, who, for a generous commission, ensure that a client gets a government grant without having to go through the regular process of justifying a project to a federal agency. Some lawmakers often receive hefty campaign donations from earmark recipients, while others have gone even further. Former Representative Randy "Duke" Cunningham (R-CA) is currently serving an eight-year prison term for accepting bribes in return for pork projects.

While pork projects are often carved out of a program's budget, they put upward pressure on program budgets by reducing the amount of money available for distribution by merit or formula. In this year's budget, it appears that lawmakers intend to fund new pork projects with a two-step process: significantly increasing program budgets and then filling in those budgets with earmarks. In this way, Congress can enact new pork projects without reducing agencies' unearmarked budgets.

Congressman Obey Acknowledges Pork's Harm

The Appropriations Committee has been called a pork project "favor factory" by indicted lobbyist Jack Abramoff. Even Chairman Obey has recently acknowledged that pork projects are harmful, telling Congress on June 14:

"…One of the reasons I have been trying to explain to the House why it takes so long to carefully screen these earmarks, is because many of the requests that come in are so vague that we don't understand where that money is intended to go to…So if the gentleman thinks that sometimes you're confused, so are we."[4]

The day before, he told Congress:

"The reason I hate earmarks is because they suck everybody in. They suck them into the idea that we have to be ATM machines for our districts, and so they focus on the tiny portion of most bills that are earmarks instead of focusing on the policy that is represented by the legislation that we produce."[5]

Later in that same speech, Congressman Obey promised to offer an impressive set of amendments:

"I'm going to be very interested in seeing which Members vote for the amendment that I intend to attach to every appropriation bill, which would call for a total elimination on earmarks. I want to see how many of you actually vote for it. I want to see how many of you do not give hypocrisy a bad name."[6]

Taxpayers, frustrated by wasteful projects such as Alaska's infamous Bridge to Nowhere, grants for tattoo removal programs in California, and grants to combat teenage "goth culture" in Blue Springs, Missouri, may welcome Rep. Obey's amendments.

Conclusion

House Republicans struck a blow for openness and transparency in demanding that pork projects be made public and debated on the House floor. Working together, they brought the House of Representatives to a halt in order to demand that Members follow through on their promises for earmark transparency. The next test will be whether Congress takes advantage of this openness to terminate the thousands of pork projects that are expected to appear in spending bills. Lawmakers should eliminate not only the pork projects but also the $23 billion slush fund that was added to finance them.

Brian M. Riedl is Grover M. Hermann Fellow in Federal Budgetary Affairs in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation.

About the Author

Brian M. Riedl Grover Hermann Fellow in Federal Budgetary Affairs
Thomas A. Roe Institute for Economic Policy Studies

Show references in this report

[1] President George W. Bush, 2007 State of the Union Address, January 23, 2007, at www.whitehouse.gov/news/releases/2007/01/20070123-2.html. The FY 2007 pork moratorium was enacted only after $13.3 billion had been earmarked in the first few appropriations bills.

[2] For pork project spending totals, see Citizens Against Government Waste, "Pork Barrel Report," 2007, at www.cagw.org/site/PageServer?pagename=reports_porkbarrelreport#trends.

[3] The House budget adds $20 billion to the President's $933 billion discretionary spending request. However, the House's blueprint reduces the President's defense proposal by $3 billion, thereby increasing non-defense spending by $23 billion above the President's request.

[4] Congressional Record, House of Representatives, June 14, 2007, pp. H6418-19.

[5] Congressional Record, House of Representatives, June 13, 2007, p. H6391.

[6] Congressional Record, House of Representatives, June 13, 2007, p. H6391.