Wednesday, September 20, 2006

Much Ado About Earmarks

Ruth Marcus writes in today's Washington Post about the practice of congressionally earmarked spending, comparing it to the new movie, All the King's Men which is loosely based on the life of Huey Long. She gives the earmark process an almost Shakespearian flavor.

In reality, legislators do not introduce earmarks for their own benefit, but because someone asks them to, usually a constituent and/or donor. There are two types of earmarks: budgetary and regulatory.

Budgetary earmarks designate in law or congressional reports how existing budgetary allocations are to be spent. In essence, they take discretion away from administration officials, replacing their judgment with their own. They don't do this on their own, but rather in response to either state and local government or private interests in their state - such as universities, businesses or non-profit institutions. Sometimes they codify agreements that have already been made, such as when I negotiated the terms of an earmark for the Washington Marina with a staff member of the House D.C. Appropriations Subcommittee when I was working for the Mayor. The "Bridge to Nowhere" in Alaska was likely such an earmark worked out between the state, the airports authority and the airlines who benefit from the bridge. By the way, that project did not go away - it is being funded through the formula grant that Alaska gets as part of the Highway Bill.

This leads to an interesting question: how much would borrowing and taxes be reduced if earmarks were eliminated?

Not one red cent. Earmarks spend within the existing allocation in the budget resolution or the existing authorized spending in the highway program. As I stated above, they merely move the decision authority from the agencies to the Congress, where constitutional purists believe it should be anyway. To them, the scandal is not that Congress is earmarking funds, but that the Administration is making any spending decisions at all.

This brings us to the topic of regulatory earmarks. These are often requested by the same constituencies that requested budgetary earmarks. For example, during the Clinton Administration the Interior Appropriation was fillibustered to revoke higher grazing fees and new grazing rules for BLM. This was not done because the westerners in the Senate were staging their own sage brush rebellion but because local ranchers asked them to.

The power to make rules at all is delegated by Congress to the Administration. These delegations are not irrevocable. Indeed, with the elimination of the single house or committee legislative veto, earmarks are the best way to oversee the Administration's regulatory program, barring a total revocation of Administration rulemaking authority. We suggest as much as part of the authorization process on our web page.

The problem occurs when regulatory (or spending) earmarks are made in exchange for campaign contributions. This is akin to bribery. The solution to this, however, is not to change how earmarks are done, but how we fund campaigns.

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