The American Enterprise Institute’s Roger Bate writes in the Washington Post’s “Think Tank Town” online feature about the need for the federal spending database proposed by Senators Tom Coburn and Barack Obama, as opposed to the watered-down version offered by Rep. Tom Davis in the House. He should understand the stakes involved. Bate worked on the USAID project to fight malaria in Africa, an effort for which Congress had provided a large amount of funding. Over 90 percent of that money disappeared into bureaucratic snarls and non-impact consultations until the program had to defend its spending publicly:

The idea of a transparency website -- replete with search engines that include subcontractors -- was born in May 2005 at a hearing on U.S. efforts to combat malaria. Officials from the U.S. Agency for International Development (USAID) squirmed as Coburn revealed that 93% of the agency's 2004 funding to eradicate malaria had been spent on administrative and advice-giving services. In addition, not enough of these funds were spent overseas; too much was absorbed by high-paid U.S. consultants. …

In the case of USAID's efforts to fight malaria in Africa, the oversight returned quick results: "Once the agency figured out how they actually spent money, they couldn't justify the status quo and we saw dramatic reform," according to Coburn. "Now, lives are being saved in Africa because of USAID's malaria program. The hearing was a case study in how forcing transparency in government really can work miracles and save lives."

The experience showed Bate the critical importance of public oversight for both grantees and contractors, especially on aid programs. These programs come into being to address critical needs at home and especially abroad, and the temptation to throw large amounts of money at these acute problems can be irresistible. The federal response to hurricanes Katrina and Rita proved this, especially given the controversy over the immediate aid response from FEMA. This impulse, however, creates situations in which oversight suffers and much of the money gets wasted, or worse. The government recently estimated that over a billion dollars of Katrina aid went into the pockets of fraudsters or were lost in incompetence.

Not all of that got lost through grants. Much of it dissipated through poorly-managed federal contracts. Yet the Davis bill exempts contractors from public disclosure. Perhaps Davis’ Virginia district might explain his reluctance to expose the processes of federal contractors, as a number of such companies do business there. Davis wants people to believe that the federal contracting process is so competitive and open that disclosure isn’t necessary, which flies in the face of experiences such as that of the recent Katrina programs.

Bate explains well why the sunshine of disclosure should illuminate all federal spending. Practically speaking, we cannot get the full picture of expenditures if we cloak a significant part of them in darkness, and this only encourages politicians to exploit the situation for their benefactors. Politically, the effort to exempt big corporations from the same public disclosure required of grantees will cause the broad spectrum of support for the spending database to collapse. Davis, however, has recently indicated he might work to amend his proposal to bring it in agreement with Coburn-Obama.