CQ Today reports on "earmark reform" legislation:

Senate Democratic and Republican leaders proposed tougher earmark disclosure rules Tuesday but left in place an exemption that would allow sponsors of thousands of earmarks to remain hidden.

New language proposed by Majority Leader Harry Reid, a Democrat from Nevada, and Minority Leader Mitch McConnell, a Republican who represents Kentucky, continues to exempt "federal" projects, such as Department of Defense construction projects, that constitute a large portion of earmarks.

But there's an even bigger exception: This approach would not apply at all to the 95 percent of earmarks, according to CRS, that are not listed within the text of a bill. Thus 95 percent or more of earmarks would not be subject to "tougher" disclosure. That's not reform at all.

As always, look to Sen. Tom Coburn for good ideas on spending issues, especially this proposal:

Coburn urged President Bush to instruct agencies to ignore report language that does not have the force of law but that contains instructions for the bulk of earmarks. The president has joined in a call for an earmark overhaul but has allowed agencies to continue funding earmarks that are not included in bill text.

If an earmark is not in the bill, it is not the law.

Posted by Andrew Grossman at 10:11 AM | Permalink | TrackBacks (0)

Once again, Congress waited until the end of the year to rush through a pile of appropriations bills. And once again, those bills are loaded with pork barrel spending.

Heritage's Brian Rield counts upwards of 10,000 earmarked projects in the 11 remaining appropriations bills, which is about the same amount of pork as last year. After getting throttled at the ballot box for their fiscal largess, the Republican Congress apparently hasn't taken voters' disgust to heart. Riedl's list of the worst pork projects in the bills contains a few howlers like there:

• $1,000,000 for Mormon Cricket & Grasshopper Activities in Utah
• $575,000 for Detroit Renaissance (Good luck!)
• $6,371,000 for Wood Utilization Research (!?)
• $175,000 for the Andre Agassi College Preparatory Academy (Agassi has $31 million in career earnings, plus probably more in endorsement fees)

So it's business as usual, in other words.

Except not exactly. Sen. Tom Coburn, a true fiscal conservative, plans to offer up to 40 amendments to strip some of the worst pork out of the Ag appropriations bill.

The Senate needs more like Coburn.

And perhaps the Democrats will have better luck controlling spending. Heritage's Ron Utt thinks that House Speaker-to-be Pelosi has a chance to put an end to this earmarking madness.

So will appropriations next year be any different? At the least, with his party-mates out of power, Sen. Coburn should have a few more allies.

Posted by Andrew Grossman at 01:14 PM | Permalink | TrackBacks (0)

A post below asks, "So how will voters' view of spending impact the elections?"

In a Miami Herald column today, Brian Riedl doesn't make any predictions, but he does admonish politicians who think that they can woo voters with government largesse.

Spending restraint is sound policy but awful politics.

That's the conventional wisdom among a Republican congressional majority that, haunted by memories of the 1995 government shutdown and the demonization of former Speaker Newt Gingrich, views the electorate as various special interests selling their votes to whichever party offers the largest subsidies. As former Republican Party chairman Ed Gillespie once reportedly told the Manchester Union Leader: The American people want big government, and the Republican Party has decided to provide it....

Which raises the question: If runaway government spending is supposed to buy popularity, why has Congress' approval rating sunk to a 12-year low of 24 percent? Why do so many pro-spending incumbents face uphill reelection battles?

Posted by J. Lawrence Scholer at 04:17 PM | Permalink | TrackBacks (0)

Rep. Curt Weldon is under investigation for exchanging campaign contributions and the like for legislative favors. McClatchy reporter Greg Gordon has an extensive analysis. This paragraph stood out:

MGB's Griffin declined to specify what Weldon did to fuel the subsidiary's growth, except to say that he assisted in earmarking appropriations for an Air Force program to replace aging parts on aircraft landing gear.

Emphasis added.

When will Congress realize that the current earmarking culture is not only bad for America but also bad for Congress?

Wondering how the whole earmarking thing works? See Ron Utt's primer. In a paper from earlier this year, Brian Riedl outlines "Six Budget Reforms to Restrain Lobbyists and Special Interests."

Posted by Andrew Grossman at 10:37 AM | Permalink | TrackBacks (0)

This from CNN is encouraging:

The poll released Friday...showed that an overwhelming majority of Americans perceive, correctly, that the size and cost of government have gone up in the past four years, when Republicans have had a grip on the House of Representatives, the Senate and the White House....

Queried about their views on the role of government, 54 percent of the 1,013 adults polled said they thought it was trying to do too many things that should be left to individuals and businesses. Only 37 percent said they thought the government should do more to solve the country's problems....

When asked if the size of the federal government has increased in the past four years, 72 percent said it had, and 86 percent said they thought federal spending had gone up during the same period.

This is good news--Americans should be aware of what their elected officials are up to. And by the numbers, the basic conservative premise of America remains intact--at least by a slim majority.

Any voter seeking a by-the-numbers overview of federal spending would do well to peruse this Brian Riedl paper, one of Heritage's most popular over the past year. It's chock-a-block with charts and graphs that drive the point home: federal spending has been growing at an explosive rate.

So how will voters' view of spending impact the elections? It is not for us to say. Perhaps our friend Ed Morrissey has an opinion.

Posted by Andrew Grossman at 09:43 AM | Permalink | TrackBacks (0)

Today the Financial Times reports on a proposal to require the federal government to account for future entitlement spending. FT reports,

The proposal by the federal accounting standards advisory board (FASAB) – which would also require the government to account for benefits accrued under Medicare and other social insurance programmes in the same way – is unprecedented internationally. It would radically change the presentation of US government finances, in effect bringing forward the cost of rapidly increasing social security and Medicare obligations and greatly increasing the reported fiscal deficit.

Last year Alison Fraser argued why accrual accounting is fiscally responsible. She wrote,

Amending the federal budget process to include this principle of planning for future obligations would:

• Impose responsible fiscal management on the budget process. Significant policy undertakings such as the Medicare drug benefit should contain a sound financial plan and make an annual allocation toward any liability or obligation.
• Require recognition of future liabilities and obligations in annual budget plan­ning. The budget is now written on a cash basis and does not plan for the huge liabil­ities and obligations that will come due in the future. This would provide Congress with a long-term budgetary context for proposals to fix entitlement programs within which new costs would be evalu­ated against future savings.
• Force lawmakers to recognize the true cost of proposed future entitlements in the annual federal budget. This would require Congress to begin to rein in the federal govern­ment’s commitments that will come due in the future and would discourage lawmakers from voting for new benefits and passing on the cost to future Congresses.

Posted by J. Lawrence Scholer at 11:21 AM | Permalink | TrackBacks (0)

Federal Times is a real niche publication. It bills itself as "The one-stop news and information service for Federal Managers," and its media kit claims "BPA AUDITED CIRCULATION of more than 40,000 government executives." So if you're not a government executive, you probably don't read Federal Times; and if you are, you do.

This matters because it gives some weight to the informal polls that Federal Times runs on its website. And these polls really are something. For example, it's one thing to complain about government waste in the abstract, but it is wholly another when 74 percent of government executives responding say that their offices' spending "could be trimmed through greater efficiencies and better planning without it hurting performance." Just look at the results:

How much of your office's spending do you think could be trimmed through greater efficiencies and better planning without it hurting performance?

Pretty amazing, no?

And take a look at this one:

Do you think your agency is wasting money sponsoring or sending employees to conferences?

And here's one more:

How often do you take sick leave when you are not really sick?

To sum up, 74 percent of government executives say that their offices could cut spending significantly with no impact on services, even with cuts of more than 20 percent; two-thirds of government executives can identify wasteful trips to conferences; and almost half of government executives play sick to take off of work.

The good news is that there's so much room for improvement; the bad news is the same. From a policy perspective, we wonder that competitive sourcing wouldn't address the lax and wasteful budgeting and work procedures behind these poor results. The basic idea is that government workers compete with private-sector entities in submitting bids for the functions that they now perform. This makes sense especially when the functions are not inherently governmental, such as: trash collection and recycling programs, janitorial services, facilities management, motor vehicle service and repair, operation of prisons and jails, data processing, park maintenance, etc. Why shouldn't private firms do these tasks, at lower costs to taxpayers and often far greater efficiency than government workers?

Of course, government workers' unions are dead set against their members having to compete for work. (After all, isn't that part of why they joined the government to begin with?) And the unions have had some success in slowing the spread of competitive sourcing. But Federal Times has some good news on that front, too:

Are federal employee unions losing their clout?

Nice.

Posted by Andrew Grossman at 07:44 AM | Permalink | TrackBacks (0)

The Club's Andy Roth quotes a CQ story, which in turn quotes Heritage's Tim Chapman:

Because Coburn and Obama, senators with vastly different ideological bases, worked together on the database bill, some bloggers hope they will combine forces for similar legislation. They would like to see them form a type of Open Government Caucus that would provide inspiration all along the political spectrum. “I’d love to see it happen,” [Heritage Foundation Director of the Center for Media and Public Policy Tim] Chapman said. “Because I think they’d have a whole chorus of bloggers at their backs that would echo everything they’re trying to do.”

Responds Roth, "I like the sound of that." True, it doesn't sound terrible, but this thinking equates weblogs with plain old grassroots lobbying. That sells (some) weblogs far short, including Andy's and Tim's. It's great that Coburn, Obama, and a few others in Congress want to work to promote transparency in government affairs. But remember that the main consumers of the information that will be released, though, are reporters, researchers, and (yes) bloggers--and in the end, the broader public. Policy changes to increase transparency are a means, not an end.

So bloggers shouldn't just be cheerleading; they should be leading the charge. This seems to be, generally, Mark Tapscott's view of things. (Much of bloggers' and reporters' capability in data crunching is due to the CARR classes that he's run with Heritage.) The Capitol, after all, isn't exactly a hothouse of policy innovation.

So maybe a Greek chorus is a better metaphor. It stands as the voice of reason and propriety, no mere echo.

Posted by Andrew Grossman at 02:13 PM | Permalink | TrackBacks (0)

The Washington Post introduces a new phrase to invoke wariness and skepticism:

An eruption ensued. The other companies quickly turned to Congress to quash the idea. In congressional testimony and letters to lawmakers and regulators, they complained that competing on price threatened the "unique public-private partnership" that the companies had with the government.

The article details the business of "a collection of niche insurance companies that have made billions in profits from the federal crop insurance program, even as the government has lost billions covering the riskiest claims..." Here are the numbers involved:

Last year, the companies made $927 million in profit, a record. They received an additional $829 million from the government in administrative fees to help run the program. On top of that, taxpayers kicked in $2.3 billion to subsidize premium payments for farmers.

All of that to pay farmers $752 million for losses from bad weather.

When the government decides to fund or subsidize a service in some way, letting private firms deliver it is a recipe for lower costs, greater efficiency, and increased satisfaction. Usually. That's assuming that the firms don't hijack the legislative or regulatory process from the beginning to undermine competition and secure truly windfall profits.

It looks like that's what's going on with crop insurance subsidies. Certainly, insurers will have good years and bad years, especially when the risks involved are sector-wide, such as drought and blight and other maladies that afflict (or not) large swathes of the agricultural industry at once. But insurers deal in risk, not redistribution. It's suspicious that the insurers here have done so well, year after year, excepting once or twice when they suffered modest losses.

The problem with this program, aside from the probably unnecessary government subsidies, is that "Each of the 16 companies sells policies at the same rate set by the government." There is no competition on price. When one insurer attempted to run an endgame around this policy and offer lower prices, other firms complained that it would "place companies in financial jeopardy and might result in Crop 1 agents "cherry-picking" larger, more profitable accounts while sidestepping smaller, riskier farmers."

That argument doesn't hold water. Insurers compete on price across the economy, covering trillions in business activity from all manner of possible risks, such as drought, flooding, commodities fluctuations, deaths, and anything else you might imagine. These markets--even the ones for highly esoteric forms of coverage--are by and large very competitive and very price-focused--e.g., ask a university risk administrator how much time he or she spends negotiating on price for liability coverage and playing insurers off one another.

Mandated prices are particularly pernicious in the insurance industry because they destroy incentives to engage in risk-mitigating behavior. A warehouse, for example, might install fire sprinklers at the behest of its insurer, which might offer a premium reduction in return. And premiums are almost always lower for firms and individuals who have claimed less in the past, often due to risk-mitigating behavior. So would farmers plant more drought-resistant crops without the incentive of lower premiums when they are insulated from the direct loss? Why bother?

Even if the government is going to subsidize insurance (a matter basically beyond the scope of this post, but we're dubious), there is no reason for it to set prices, especially when those prices appear to be higher than the market-clearing rate. The result of the current policy is a simple and direct transfer of money from taxpayers to crop insurers that doesn't especially benefit those it's meant to help, the farmers. This is inexcusable and indefensible on economic or practical grounds.

To that end, we particularly enjoyed this quote, by a spokesman for Sen. Conrad Burns, on Burns's proposing legislation to block premium competition: "But his rationale was that the premium reduction program wasn't working. It was a bait and switch. There was no guarantee that farmers would get a reduction in their premium in the end." Price mandates, of course, guarantees that no one gets reductions.

Kudos to the Post for another excellent investigative piece on the nation's failing farm policies. Find more here.

Posted by Andrew Grossman at 11:03 AM | Permalink | TrackBacks (0)

It's bad enough when industry or an interest group of some sort gets teams up with the bureaucracy to push measures on (an all-to-willing) Congress. But somehow it seems worse when the bureaucrats cut out the middleman and take to lobbying on their own.

In today's Washington Times, Richard Rahn describes two of the more odious examples of government entities using taxpayer dollars to push for, well, more taxpayer dollars and taxpayer-hostile policies:

Rather than get rid of inefficient routes and shape up its operations, Amtrak's management has been giving grants to the National Association of Railroad Passengers (NARP), which lobbies for more federal spending on Amtrak. Last month, several individuals who helped establish train-advocacy groups, including NARP's former chairman, called on NARP to stop accepting funds from Amtrak, which they called an "ethical breach": "The time is long passed for NARP to remain in league with the government monopoly responsible for one of the world's worst passenger rail systems in terms of costs, performance, and innovation." ...

he U.S. provides about a quarter of the almost $400 million OECD budget. Concerned about the OECD's move away from pro-growth free-market principles and at the urging of the Center for Freedom and Prosperity and other public policy organizations, the Senate decided to include a provision in the Foreign Operations appropriations bill barring the OECD from pursuing antitax competition policies....

The head of the OECD's Washington office, Sandra Wilson, then wrote (on Sept. 28) to U.S. Senate and administration officials requesting "that this language be removed from the bill." Here we have a case of a representative of an international organization directly lobbying for both increased U.S. government spending and increased taxes on U.S. citizens, using, in part, U.S. taxpayer dollars to do so.

So far as agencies pulling this kind of nonsense, the recently-passed spending database bill should curtail the worst abuses. For what it's worth, agencies already aren't supposed to lobby Congress in certain ways, but there are myriad ways around that restriction. In past years, for example, the EPA has given piles of dough to environmentalist groups; while that money wasn't intended for (and can't be used for) lobbying, it is of course fungible.

And what about other government entities, like Amtrak and the OECD? Some face statutory restrictions, but for others, shame will have to do. A recent Sun editorial shows how Amtrak structured its relationship with NARP to appear entirely above-the-board:

Since the mid-1990s, Amtrak has paid NARP to administer the rail service's Customer Advisory Committee, a group that is supposed to offer periodic quality-control feedback to Amtrak's management.

Not only can Amtrak collect such feedback for free via the complaints section of its Web site, Amtrak may well be overpaying NARP. In 2005, NARP spent $21,840 directly administering the advisory committee, and received $34,464 from Amtrak. The $12,624 difference went to overhead costs like office space and communications, NARP's treasurer, Robert Glover, claimed in an e-mail sent to Amtrak critics.That overhead cost covers more than 20% of NARP's office-related expenses, according to figures Mr. Glover himself provides in the e-mail.

One wonders how many other federal entities engage in similar shenanigans. Again, Capital Research has the broadest data...for now. Once the spending database comes online, expect a free-for-all.

Posted by Andrew Grossman at 09:00 AM | Permalink | TrackBacks (0)

One particularly bad habit Congress has acquired during the war on terrorism is the emergency appropriation. Originally intended for actual, unforeseen emergencies (Hurricane Katrina would be one example), both Congress and the White House have use emergency spending bills to bypass normal budgetary controls. The Heritage Foundation’s Brian Riedl and Alison Acosta Fraser addressed this issue six months ago:

Supplemental spending should be reserved to unforeseen emergencies. Congress should offset additional spending by reducing funding for lower-priority projects elsewhere in the budget. It is unrealistic to think that all war spending would be offset, especially because there is a placeholder for some of this spending in the budget resolution. However, all non-war spending should be offset. The Administration and some in the Senate—such as Senators John McCain (R-AZ), Tom Coburn (R-OK) and John Ensign (R-NV)—acknowledge the need to cut spending elsewhere in the budget to pay for Katrina-related expenses. Polls show that Americans strongly support this kind of fiscal restraint…

Unfortunately, many of the spending items that wind up in supplementals are all too foreseeable. Because emergency supplemental bills do not count against budget caps, they are routinely loaded with additional spending that is unrelated to the original purpose of the legislation.

Unfortunately, Congress lacks that level of fiscal discipline, or at least it has up to now. One item that will greet Congress when it returns from its midterm recess will be HR 6176, the Responsible Emergency Appropriation Limits (REAL) Supplemental Act. Rep. Randy Neugebauer of Texas introduced this legislation at the end of September. It would limit the ability of Congress to use emergency appropriations to fund activities that should be easily foreseen:

Neugebauer’s legislation, the Responsible Emergency Appropriation Limits (REAL) Supplemental Act (H.R. 6176) reforms House rules so that an emergency supplemental appropriations bill can only provide for a single emergency, contain only emergency spending, and must be free of earmarks.

“The practice of loading up emergency bills with pork and other non-emergency items needs to come to an end,” Neugebauer said. “Too often, good bills that address real emergencies turn into bad bills and taxpayers are left to foot the bill.”

Neugebauer pointed to the recent emergency appropriations bill to fund the War on Terror as an example of an emergency appropriations bill that became a spending magnet. Soon after President George W. Bush submitted his request for War on Terror funding in February, 2006, a separate bill to fund Gulf Coast recovery was added to his request. In addition, unrelated, non-emergency items to fund projects in California, Hawaii and Illinois, among others, were included that increased the cost of the bill. Although President Bush’s initial request totaled $72.4 billion, the final price tag came to $94.5 billion. Neugebauer says that number would have been even bigger had it not been for fiscal conservatives in the House.

Emergency appropriations typically get rushed through both chambers of Congress, as most of them relate in part to some pressing need. The pressure of immediate action acts as an earmark attractant, and the need for haste keeps the legislation from getting the necessary oversight to remove the waste. Rep. Neugebauer’s proposal would keep the speed of the emergency appropriations process intact but filter out any provisions that did not solely and specifically focus on true emergencies. Neugebauer defines the term in HR 6176:

(1) As used in this section, the term `emergency' means a situation that-- (A) requires new budget authority and outlays (or new budget authority and the outlays flowing therefrom) for the prevention or mitigation of, or response to, loss of life or property, or a threat to national security; and (B) is unanticipated. (2) As used in paragraph (1), the term `unanticipated' means that the situation is-- (A) sudden, which means quickly coming into being or not building up over time; (B) urgent, which means a pressing and compelling need requiring immediate action; (C) unforeseen, which means not predicted or anticipated as an emerging need; and (D) temporary, which means not of a permanent duration.

The REAL Supplemental Act explicitly rules any emergency appropriation request out of order if it contains any earmarks at all. This closes the door on chronic porkers and might actually dissuade Congress from abusing the supplemental-funding process altogether. Look forward to Rep. Neugebauer’s bill coming before the Rules Committee after the recess.

Posted by Ed Morrissey at 10:33 AM | Permalink | TrackBacks (0)

As printed in today's White House Bulletin:

David Letterman: “You folks hear about the new scandal in Washington, DC? Police have broken up a call girl operation. And apparently it catered exclusively to politicians, politicians -- yup. And instead of cash, one girl actually got an interstate highway.”

Posted by Andrew Grossman at 02:55 PM | Permalink | TrackBacks (0)

Supporters of fiscal discipline in federal spending should note two important articles. First, the New York Times reviews the impact that pork-barrel spending has on the expansion of the federal budget. David Kirkpatrick’s article should be read not for its identification with one particular House member but with an understanding that many appropriators in Congress use earmarks to push legislation through to law without much consideration or debate (emphasis mine):

After becoming chairman of the defense spending panel in 1989, Mr. Murtha imposed a new discipline. Previously, the House often debated defense spending bills, which account for about half of federal discretionary spending, for weeks of contentious amendments and speeches, both in the committee and on the floor. Most Democrats often voted against the measures. “It took day after day after day,” Mr. Murtha recalled.

Not any more. Mr. Murtha installed a new system that the Republicans have continued: the chairman and ranking member work out the details behind closed doors, pack the bill with plenty of earmarks, and link future projects for members to their support for the bill. The appropriations committee now typically debates and approves the bill in less than eight minutes and the full House in less than half an hour. (The $437 billion measure passed last week took under 20 minutes.)

This is the true danger of pork. It greases the skids on legislation so that no debate of any worth takes place by essentially buying the necessary votes from House members. The House last week took all of 20 minutes in discussing one of the most complex and expensive expenditures in the federal budget. Does anyone think that this amount of time provided any member with enough information to seriously understand where that money would go?

Small wonder, then, that Congress as a whole has lost all sense of fiscal discipline. Brian Riedl wrote an alarming analysis last week that clearly shows that spending has not only failed to slow, but has actually gained momentum in this last session of Congress:

Federal spending in 2006 is set to rise 9 percent, the largest increase since 1990 and enough to earn Congress near failing grades from the Heritage Foundation’s third quarter report card. Most families facing steep new expenses would cut back on additional spending. However, the Senate is preparing to bust fiscal year (FY) 2007 discretionary spending caps by at least $32 billion to:

1. Reimburse the Pentagon for the $9 billion raided from its budget earlier this year and given to domestic programs, as well as fund additional defense and border security programs ($26.8 billion in total);
2. Fund another massive farm subsidy bailout despite high subsidy levels and a booming farm economy ($4.2 billion); and
3. Reimburse NASA for funds that lawmakers had diverted into parochial pork projects ($1.0 billion).
4. And in addition, lawmakers have promised $2 billion to $3 billion more for the labor, health, and education programs. Senators classify much of this new spending as “emergency” so that it does not technically count against the budget caps. But this spending is foreseeable—and often the predictable result of budget gimmickry—and so is not an “emergency.” For the sake of taxpayers, Congress needs to set its budgetary priorities, make tough choices, and offset any increases.

Riedl exposes the “emergency” tactic that Congress has adopted of late, especially since the beginning of the war on terror. In reality, Congress creates the emergencies by playing shell games with spending, and then pushing through these “emergency” appropriations that serve two purposes. One, they allow Congress to bypass spending caps; and two, they attempt to pre-empt criticism of the spending by casting the bills as a rescue for some vital program.

Fortunately, Congress has to deal with much more sunlight than ever before. The corrosive nature of earmarks and the fiscal irresponsibility they produce has already aroused the ire of the American electorate. We need to keep educating ourselves in these budgetary parlor tricks in order to hold our representatives accountable for their actions. As Andrew Grossman points out, these stories will become more frequent in direct relation to increases in federal spending, giving more opportunities for Americans to discover these sordid machinations. Only then will Congress start operating with any discipline on spending.

Posted by Ed Morrissey at 12:50 PM | Permalink | TrackBacks (0)

The NY Times today runs a piece detailing Rep. John Murtha's (D-PA) decades of experience and leadership in doling out billions in defense earmarks to fellow representatives, favored lobbyists, and corporations in his own district (including one that he founded).

Murtha is ranking member of the House Defense Appropriations Subcommittee and has long "operated a political trading post in a back corner of the House of Representatives" where "two dozen Democrats mill around his seat" and Murtha "delivers Democratic votes to Republican leaders in a tacit exchange for earmarks for himself and his allies."

One lawmaker especially grateful to Murtha is Rep. Paul E. Kanjorski (D-PA), whose own relatives have benefited personally from his and Murtha's earmarks. But that's OK because, as Kanjorski explains it, his relatives stand apart from other men:

Mr. Kanjorski, the Pennsylvania Democrat, said he had help on “8 to 10” projects, including a $9.5 million deal four years ago for research by a firm partly owned by his nephews. In an interview, Mr. Kanjorski said his relatives “just happened to be the only people who would take responsibility” for developing the technology, which involved using water jets to pulverize materials. He said he recently gave Mr. Murtha a pair of high-tech disease-resistant socks made with silver fibers by a company in his district. After padding around in them, Mr. Kanjorski said, Mr. Murtha was so pleased that he agreed to an earmark to buy them for soldiers.

It is a great service to us all that Kanjorski's relatives were willing to "take responsibility" for developing a technology that the military probably doesn't really want (otherwise, why the earmark) and that has passed such rigorous testing as Rep. Murtha's private review on his very own feet.

In addition to socks, Rep. Murtha seems to know a thing or two about family business:

Mr. Murtha’s brother, Kit, recently retired from a smaller lobbying firm, KSA Consulting, that sought defense earmarks and represented many companies in Mr. Murtha’s district. From 1998 through 2003, he received more contributions from military contractors than has any other member of the House, according to the Center for Public Integrity, a nonpartisan group.

Perhaps thanks in part to his brother's efforts, Murtha "has steered billions of dollars to his district over the years, including more than $80 million in the defense spending bill passed Friday, according to a preliminary tally."

A word to the wise: when the federal spending database is up and running, this sort of in-depth reporting will become routine and accessible to even the smallest local papers. We look forward to it.

Posted by Andrew Grossman at 09:49 AM | Permalink | TrackBacks (0)

No, not morally or culturally bankrupt, but is the United States fiscally bankrupt?

In the Tax Foundation's latest podcast, economist Lawrence Kotlikoff says yes. Government health policy is primarily to blame, he says. He suggests a voucher-based program for health care, as outlined in this paper. Also on the agenda: tax reform, accounts in Social Security, and drastic cuts in discretionary spending. Without action? "Meltdown is inevitable."

But does Congress have the willpower to enact reform? "They're not paying any attention," says Kotlikoff. "The country is broke."

One bright point: fundamental tax reform could make a big difference on America's long-term fiscal balance sheet.

Listen to the podcast here (mp3 link) and subscribe here.

Posted by Andrew Grossman at 12:37 PM | Permalink | TrackBacks (0)

Ten years after Congress first passed a line-item veto to allow presidents to help control spending—and nine years after the Supreme Court ruled it unconstitutional in that form—Congress has the opportunity to try again. A line-item veto bill has already passed in the House, 247-172, in late June and has been awaiting action in the Senate ever since.

Most of the reform effort at the end of this session has focused on two proposals: the Federal Funding Accountability and Transparency Act of 2006, otherwise known as the Coburn/Obama on-line database, and the rule changes in the House that now require all earmarks to include the identities of their sponsor in the Congressional Record. Since President Bush challenged the Senate to pass the line-item veto in the last days of June, not much attention has fallen on the effort.

It’s a shame because, although the line-item veto has its limitations, it represents yet another step towards accountability and fiscal discipline. As Brian Riedl noted in March, this line-item veto gives the executive additional tools with no real downside:

The Line Item Veto Act of 1996 allowed the president to veto specific provisions that allocate discretionary budget authority, increase entitlement spending above the baseline, or create limited tax benefits.[1] This operated as a regular veto, with Congress needing a two-thirds vote to override it.[2] The Supreme Court struck down this authority, ruling that it violated the separation of powers. With a straightforward line-item veto forbidden, crafting an effective tool to eliminate wasteful, unnecessary individual spending provisions without running afoul of the Court now requires some creativity.

Thus, President Bush does not propose to create a traditional veto for line items, as the 1996 law did. Rather, his proposal would enhance the president’s existing rescission authority. Rescission is the process whereby the president sends legislation to Congress to cancel budget authority that was previously enacted but not yet spent. Like any legislation, rescission bills must be passed by the House and Senate and then signed by the president. Currently, however, Congress can kill a rescission request by voting it down or simply ignoring it. The President’s Legislative Line-Item Veto Act of 2006 improves on existing rescission authority in several ways:

• The president could “veto” entitlement changes and special tax breaks, as well as all discretionary appropriations;
• Congress would have to act on “veto” packages within 10 days of the president submitting them;
• Congress would have to hold up-or-down votes that could not be amended on the “veto” package bills;
• Senators could not filibuster a “veto” package bill; and
• Only a simple majority would be required to pass a “veto” package bill.

The question about the line-item veto isn’t whether it would do damage to the Constitution, it’s whether it would get used. This administration has been the most reluctant in American history to veto legislation, although it has used the threat of veto. The Senate probably takes this proposal less seriously considering this track record and may have thought to put more effort into the other reforms as a result.

The White House already can simply choose not to spend the monies appropriated by Congress, especially the earmarks in conference and committee reports. In fact, the line-item veto won’t apply to such earmarks—only those line items listed in the official budget. And nothing will get trimmed if the White House refuses to challenge Congress on spending, an effort sadly lacking in this particular administration over the past six years. But, President Bush’s support for the line-item veto indicates that he wants to change that in his final two years in office as evidenced by the hard push OMB Director Portman and other administration officials are making for this change

While some may object to this version of the line-item veto as doing too little, it’s important not to let the perfect become the enemy of the good. Later Congresses can address its shortcomings as they become clear and as voters demand more discipline in spending. Having this tool in the hands of the executive will allow for some challenge to the sillier projects attached to the federal budget, forcing Congress to vote on a number of embarrassing efforts, such as the $3 million allocated to the Charles Rangel Center for Public Service. Any tool that can shame Congress into reduced spending is worthwhile to the American taxpayer.

Posted by Ed Morrissey at 01:25 PM | Permalink | TrackBacks (0)

In our efforts to expose the petty corruption involved in earmark abuses, we should remember that not all earmarks are pork and not all pork comes through earmarks. Earlier this week an AP story highlighted some questionable spending at the Legal Services Corporation, the federal agency that carries a mandate to provide legal assistance, at taxpayer expense, to those unable to afford it. Unfortunately, more of them do without legal assistance because some of the federal funding for the agency gets spent on other priorities:

Agency documents obtained by The Associated Press detail the luxuries that executives of the Legal Services Corp. have given themselves with federal money - from $14 "Death by Chocolate" desserts to $400 chauffeured rides to locations within cab distance of their offices.

The government-funded corporation also has a spacious headquarters in Washington's tony Georgetown district - with views of the Potomac River and a rent significantly higher than other tenants in the same building.

And board members wrote themselves a policy that doubled the amount they could claim for meals compared with their staff. …

The headquarters has multiple conference rooms and kitchen/pantry areas. Yet, the corporation's 11-member board of directors holds its meetings at hotels around the country, including Washington, at costs ranging from $20,145 to $55,125 - the latter in San Juan, P.R.

National Review picked up same story and provided more background. The tony Georgetown digs cost the LSC $17.1 million in leases, of which its Inspector General Kirt West estimates at least $1.3 million to be overpayment. West also noted that the lease includes arrangements for $2 million in payments to Friends of the Legal Services Corporation—an organization with “close ties” to the LSC’s board members. That, West told Congress, could represent a criminal conflict of interest.

Despite this track record of waste and abuse, Congress has voted to increase the agency’s funding, even while it had to intervene to keep the LSC’s board from firing West. The Senate has approved a $31.5 million increase, while the House gave the LSC $25 million more. No doubt the impetus for more funding came from reports that the LSC only services 50 percent of eligible clients, and that only 20 percent of all legal needs of low-income Americans are being met. However, one would think that Congress would insist on better money management by the LSC—and perhaps a more responsible board of directors—before giving them even more money to waste.

Or perhaps they would be better advised to cut all funding to the Legal Services Corporation. As Heritage Foundation President Edwin J. Feulner wrote earlier this month, plenty of questions surround the LSC’s own legal status. Despite explicit restrictions on representation of clients outside the U.S., the LSC actively recruited migrant workers in Mexico to join a lawsuit against American farmers. It also has violated prohibitions on allowing its resources to be used in class-action lawsuits in Georgia and California. Edwin Meese outlined these offenses to Congress in 2002—and the response to the waste and the abuse has been to give the LSC ever-expanding increases. Nor are these problems recent; Virginia Thomas and Ryan Rogers reported in 1999 that the LSC inflated its case workload in order to justify increased funding. This was no mere fudging, or a case of excessive rounding—LSC reported handling 370,000 cases in a year when they only handled 198,000, an overstatement of 86 percent. That’s significant even by Congressional budget standards, and indicates a systemic honesty issue at the LSC.

Reforming the mechanisms of appropriations in Washington, D.C. is an important first step in eliminating waste, fraud, and corruption. We need to make sure we’re keeping a close eye on all the other means that our government wastes money and under-delivers its services.

Posted by Ed Morrissey at 01:37 PM | Permalink | TrackBacks (0)

Roll Call reported yesterday on the effect that the new House rule requiring each earmarks to carry the identification of its sponsor. Because the House and Senate could not agree on terms that would cement this commonsense approach to open government in law, the House had to settle for a rule change. That hasn’t kept reformers in the Senate from trying to get a similar rule in the upper chamber, but they are using a rather strange strategy to accomplish it. According to the report, they’re deferring the matter to the Rules Committee chair, a Senator who has already established a long track record of opposing such reforms:

The two Senators taking the lead on reforming their chamber’s earmark rules need to come up with a measure that can sail through the Senate before GOP leaders approve it, a senior leadership aide said.

The Senate is struggling to match the reform enacted last week by their House colleagues, and with the clock ticking down to adjournment, it is unclear whether Senators will be able to produce any workable rules changes.

For now, Senate Republican leaders are deferring to Rules and Administration Chairman Trent Lott (R-Miss.) and ranking member Chris Dodd (D-Conn.), a GOP leadership aide said.

Similarly imperiled is a plan that Lott and Dodd want to push to eliminate the long-standing Senate tradition of secret holds, in which Senators can block legislation without identifying themselves. Republican leadership in the chamber remains opposed to the proposal.

Senator Lott’s track record indicates that he is unlikely to move quickly to reform earmarks. A Roll Call article from last year quotes the former Majority Leader as openly boasting of his ability to bury funding in bills so deeply that other Senators might never realize they’ve approved it. It also indicates that eliminating the secret hold might further enable other Senators in disguising their pork just long enough to be successful:

Still, during his more than 30 years in Congress, Lott said he has learned something about how to keep the likes of Coburn from stopping his pet projects from becoming law.

“The way I do it is, I fold them into bills where you can’t find it,” Lott said. “I’ve been around here long enough to know how to bury it.”

Indeed. There is little mystery about why Senator Lott and others want to end secret holds, especially given this rather telling admission. The hold notifies leadership that a Senator plans to object to a call for unanimous consent, a delaying tactic that allows members extra time to review the language in a proposed bill or resolution. It can’t stop the bill from receiving a vote, but as we saw earlier, it can complicate its path enough to get a lot of attention. While the value of secrecy in the holds is certainly debatable, the hold itself provides a longer feedback loop on legislation and spending. It makes it much more difficult for politicians to “bury” pork long enough to escape the red pencil during debate.

Rules on earmarks should clearly identify their source to allow voters to hold their elected officials responsible for the spending. However, reform should not have unintended consequences that make finding pork projects more difficult.

Posted by Ed Morrissey at 03:12 PM | Permalink | TrackBacks (0)

If the politics of appropriations seems somewhat different lately, you aren’t the only one to notice. The Examiner notes that the signing of the federal spending database bill this week will allow taxpayers to find and identify wasteful spending and hold politicians accountable for their actions:

First, for most of our history, the vast majority of Americans lacked the time or resources to keep track of how the federal government was spending our tax dollars. Even with the coming of the spreadsheet programs, personal computers and the Internet’s infancy in the early 90s, it was all but impossible for any but the most determined and technically savvy citizen to see where the tax dollars were going. Among the most visible contemporary results of that situation are congressional earmarks in which anonymous Members of Congress are able to insert spending projects that can enrich campaign donors, family members, favored special interests or the Member himself. Coburn has called earmarks “the gateway drug to spending addiction.” Progress is being made on that front, too.

Now with Coburn-Obama, every citizen with access to the Internet will be within a few mouse clicks of knowing where their tax dollars are going and who is benefitting from them. Such access moves our democracy beyond Government 1.0 web sites that mainly just provide passive information and encourages more active and informed citizenry. Call it the dawn of Government 2.0. It is especially fitting that a database of federal spending — the blood flow of governance — marks the opening of the new era.

We’ve covered this topic many times here, but the point is well worth emphasizing. As the federal government grows, its accounting has become more and more opaque—to the point where even its architects have no real specific understanding of how the money gets spent. That development has put a barricade between government and the governed, and one could argue that the power inherent in such an incomprehensible budgetary system substantially reduces our freedom, at least in terms of informed consent.

John Fund notes that neither party has truly come to terms with the new era for openness, and that the party in charge will pay the price if they do not do so soon:

As modest as it is, the transparency bill spent much of August in limbo after Senate Commerce Committee Chairman Ted Stevens of Alaska, chief defender of the infamous "Bridge to Nowhere," put a hold on it, using the tradition allowing any senator to secretly block a bill. These games feed the perception of an out-of-touch Congress and demoralize many GOP voters. "Every event I go to, someone complains about overspending and pork," says Rep. Chris Chocola of Indiana, one of the most embattled GOP incumbents. "They still don't think we get it." Many members simply don't believe the political costs of pork can ever exceed the benefits. Democrats have been largely silent. After all, they get about 45% of them even as a minority. "One man's pork is another man's steak," is how many members dismiss reform. …

The federal government is now an astounding 185 times as big in real terms as it was a century ago. A general sense that Republicans have forgotten why they were sent to Washington is a big reason why only 43% of Republicans approve of Congress in this month's Fox News poll. If Republicans can't better explain how they plan to get a grip on spending, many voters will conclude they both deserve and need a time-out from power.

The GOP contingent and a significant portion of the Democratic caucus addressed the issue last week, which perhaps indicates that some old dogs can still learn new tricks. The House passed a new rule defining earmarks and requiring earmark language to include the sponsor in the bill or conference report. While this does not create a searchable database that President Bush will sign into law, it does put all earmarks and their source into the Congressional Record. Combined with the new budget database, it will provide a powerful tool with which to investigate the influence of special interests.

All of this new oversight should cause some hesitation on the part of our representatives to associate themselves with needless outlays and vanity projects. Even more importantly, our efforts to put sunlight on processes that had been hidden in darkness for decades or longer will remind our legislators who works for whom in a representative democracy.

We have not yet won all the battles to shove the workings of federal appropriations into the open, but we have started well.

Posted by Ed Morrissey at 03:02 PM | Permalink | TrackBacks (0)

Yesterday, Bill Frist surprised everyone by seizing a propitious moment to demand a floor vote on S. 2590, the Coburn-Obama bill creating a searchable online database for all federal spending. Taken aback, no senator present objected to a call for unanimous consent to the vote, and the bill passed by acclamation. Senators Tom Coburn and Barack Obama released a statement crediting the energy of American citizens for pressing Washington to adopt the measure to increase openness and accountability in government:

“This bill is a small but significant step toward changing the culture in Washington. Only by fostering a culture of openness, transparency and accountability will Congress come together to address the mounting fiscal challenges that threaten our future prosperity.”

“The group that deserves credit for passing this bill, however, is not Congress, but the army of bloggers and concerned citizens who told Congress that transparency is a just demand for all citizens, not a special privilege for political insiders. Their remarkable effort demonstrates that our system of government does work when the people take the reins of government and demand change,” Dr. Coburn said.

“By helping to lift the veil of secrecy in Washington, this database will help make us better legislators, reporters better journalists, and voters more active citizens,” Obama said. “It’s both unusual and encouraging to see interest groups and bloggers on the left and the right come together to achieve results. This powerful grassroots alliance shows that at the end of the day, Americans want to see Congress work together to get something done and not continue to engage in the partisan gridlock that so often brings Capitol Hill to a grinding halt.”

The effect of the combined power of common-citizen activism and cross-spectrum partnerships of newspapers and think tanks has been nothing short of amazing. Perhaps the most gratifying part of the experience has been to see politicians who attempted to engage in old-school procedural obstruction get publicly shamed into changing their ways. In a way, we just saw a million Mr. Smiths go to Washington—and Washington recognized it.

However, the effort is far from complete. The House passed a different version of the legislation last June. H.R. 5090, sponsored by Rep. Tom Davis, excluded government contracts from the database, which is a mistake given the nature of earmarks. Normally, when the two chambers pass significantly different legislation, they form a conference committee to reconcile the two bills and resubmit the modified bill to both houses for approval. This process takes quite a bit of time, however, and the session has precious little of that left.

And so some are now pressing for House Speaker Dennis Hastert to submit S. 2590 for a vote in the House and drop H.R. 5090 altogether. This would eliminate the need for a conference committee, especially since Rep. Davis, the House bill’s sponsor, has agreed to include contracts in any case. Minor issues, such as separating contracts and grants, could be quickly resolved, so long as the final version retains the core of S 2590: downloadable and complete federal budget data.

Whatever the two chambers’ leaders choose as their legislative strategy to make it happen, they should work quickly and not allow a handful of politicians to use procedural obstacles in order to keep the federal government’s expenditures under wraps. This job is not finished, and citizens should remain focused on ensuring that Congress acts on fiscal transparency this session.

Posted by Ed Morrissey at 10:02 AM | Permalink | TrackBacks (0)

As a few members of the Senate continue to play games with S.2590, the Coburn/Obama bill creating an online searchable database for federal spending, the enthusiasm for smoking them out has declined considerably. The Hill reports that watchdogs such as Porkbusters and OMB Watch have begun counseling their supporters to put less energy into detective work to unmask the secret holders and to put more pressure on the leadership of both Senate caucuses to bring the bill to the floor:

Bloggers on both sides of Washington’s partisan chasm called for a halt to Senate blocks on the bill, which would set up a public database of all federal grants and contracts, including those resulting from earmarks. Senate Commerce Committee Chairman Ted Stevens (R-Alaska) and an unnamed Democrat were said to have active holds as of midday, but congressional sources said Stevens removed his late yesterday.

At this point, supporters’ playing Sherlock Holmes produces less benefit and may play into a strategy of tactical delays. In the end, it really doesn’t matter whose hold remains on the bill if a handful of senators intend to deny unanimous consent to a floor vote. One hold or a dozen will still force the bill to survive up to three cloture motions over six legislative days before proceeding to an up-or-down vote.

Under normal circumstances, this would present little difficulty. However, the Senate is running out of legislative days before the upcoming election; according to Majority Leader Bill Frist, the Senate has only 15 days before it goes home for the election. Squeezing the database bill into an already-packed legislative agenda and keeping up with the cloture motions will require some effort. That doesn’t take into account the time needed to reconcile S.2590 with its House cousin.

For this reason, activists would be better served by channeling their energies into demanding immediate action on the bill now despite the holds. Frist has already gone on record saying that he will take all action necessary to get S.2590 passed before the election. The Hill notes that Minority Leader Harry Reid, who has offered public support for the bill, has not made any similar commitment to pushing against procedural obstacles. To see if Reid is indeed serious about increasing the transparency of federal spending, activists might ask him for a signal against the three-card monty of holds in which senators from both caucuses have engaged.

Posted by Ed Morrissey at 03:19 PM | Permalink