One of my regular guests is Richard Manning founder of Americans for Limited Government. His regular appearances have caused me to reevaluate how I view our governments spending habits.
One example is the area of “pork barrel spending.”
In its annual report, the “Congressional Pig Book,” watchdog group Citizens Against Government Waste reported that pork barrel spending is making a comeback in FY 2018. The report is noteworthy not only because it documents a rise in the number earmarks, but also because it reveals why the cost of pork barrel spending is increasing for taxpayers. Recent increases in pork barrel spending stem in large part from costs associated with a small number of faltering vendors.
The term “pork barrel spending” is often used as a catch-all for wasteful, self-serving government spending. But as a recent report by Citizens for Government Waste explains, “pork” is actually a particular type of spending. To qualify as pork, the spending must be designated for a project as part of a line item in an appropriations bill that circumvents established budgetary procedures.
The distinction is important because it helps explain why FY 2018 has seen a sharp rise in pork barrel spending.
Partly in reaction to scandals like the $398 million Alaskan “bridge to nowhere,” Congress passed the 2011 Budget Control Act, which imposed caps on spending as well as an earmark moratorium to be applied in FY 2012. Pork barrel spending fell to historical lows from FY 2012 to FY 2017.
In February, however, Congress reversed course and passed the Bipartisan Budget Act of 2018, which removed spending caps and the earmark moratorium. The ensuing cost of earmarks from FY 2017 to FY 2018 increased by more than 116 percent.
A close look at the numbers, however, reveals that the large increase cannot be attributed simply to Congress’s decision to pursue more pet projects. Much of the increase also stems from cost overruns stemming from a small number of government vendors who received large contracts despite their faulty practices.
The Citizens Against Government Waste report provides examples across several sectors. I can remember when I was in the Air Force, we would joke about toilet seats that cost $20,000. But all kidding aside these are very serious abuses and misused taxpayer dollars.
The most serious case involves the more than $2.6 billion earmarked for 20 additional F-35 Joint Strike Fighter aircraft. This sum represents more than 18 percent of total earmarks in the budget. The report attributes the massive price tag to “acquisition misadventures” that have driven total acquisition costs to $406 billion — nearly twice the original estimate.
What makes these figures particularly galling is that they can be traced, to a significant extent, to the mismanagement of a single firm. A Pentagon report obtained by Bloomberg revealed that United Technology Corp.’s Pratt and Whitney alone was responsible for $43 million in cumulative cost overruns for materials—the byproduct of delays in incorporating “affordability initiatives to lower the manufacturing costs.”
A recent Government Accountability Office report also notes problems with the firm’s failure to meet spare-parts delivery requirements due to limited production capacity.
As the most expensive weapon system in history, the F-35 debacle is a particularly egregious example. But the Pig Book points to pork barrel spending in other sectors plagued by faltering vendors.
In the agricultural sphere, FY 2018 allocates $10 million in earmarks for high energy cost grants within the Rural Utilities Service (RUS). Four years after the last major injection of funds in the agency, Politico discovered that about half of the nearly 300 RUS-approved projects had not drawn down their awards and more than 40 approved projects never started at all. The Omaha-based KeyOn Communications alone received a $10 million wireless project in Nevada only to sell off its assets before going out of business.
In financial services, FY 2018 devotes more than $54 million in earmarks for the Small Business Administration (SBA). Ostensibly intended for small entrepreneurs, among the program’s largest beneficiaries is a banking industry that has used its clout to ensconce itself as the SBA’s lender. In a classic case of corporate welfare, Wells Fargo and JPMorgan Chase are among the major banks receiving taxpayer reimbursements for up to 85 percent of loans gone bad.
Pork barrel spending is not necessarily without justification. Earmarks can be a convenient mechanism to act on national priorities when the normal legislative process is gridlocked. Landmark legislation like the Civil Rights Act of 1964 might not have passed but for the use of pork barrel spending to sway members of Congress.
But whatever the rationale for earmarks generally, there is no excuse for crony vendors to rip off taxpayers. The Pig Report shows that Congress can save millions of dollars simply by reigning in the bad practices of a small number of incompetent vendors.
Under the Obama administration nearly all economic growth was tied to increased government spending. Job creation was at taxpayer expense as were these kinds of abuses.
It should not surprise us that because of the efforts of the Trump administration to cut regulations and to slash government spending, the swamp is making a last ditch effort to bilk we the people. Keep watching because the drain has been pulled and the time is running out on these pet projects.
Greg Young is host of the nationally syndicated Chosen Generation Radio Show which airs Monday through Friday on Stations coast to coast. Discover more at chosengenerationradio.com.
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