Friday, September 23, 2005

Pork: Harder to Cut Than it is to Make

Yglesias and others are watching the budget-cutting process with a close eye. I must say I’m glad Republican leaders are at least thinking about how to pay for Hurricane Recovery, which was not in evidence in our President’s speech last week.

The most amusing line so far has been the Republican Study Group saying “just give us a copy of the appropriations bill, some red pens, and a quiet room”.

However, as the proposals for cutting items are coming in we get a good idea of what’s going to get the ax: NEA funding, NASA, the new Medicare bill (not proposed subsidies to industry, just actual benefits), closer audits of the Earned Income Tax Credit, and pushing new spending back 1 year instead of actually stopping it.

As pointed out, none of these are really waste, but instead are items pretty clearly accomplishing the goals they mean to. In fact, a decent amount of those programs would disproportionately help the Gulf region recover (NOLA has amazing art institutions to be rebuilt, NASA has a number of facilities down there, hospitals are going to have to cover a lot of emergency cases who don’t have sufficient paperwork, and more people will probably meet the requirements for EITC without having proper documentation).

The real waste is in the Transportation Bill, or farm subsidies, surplus military bases (which can include NASA I admit). They might not be the majority of US spending, but they are a majority of US spending that isn’t doing what the public at large wants done.

To wit, there is a clear conflict in budgetary matters between large policy goals that are viewed as abstractly important, and earmarks for small groups. We can probably afford one a lot of the time, but not both. Now a lot of politicians and voters believe in their ideals so they manage to pass bills that help the country in general, or help those who were starving, but then the media circus forgets about them.

Then later, when no one is paying attention, it’s much easier to cut the larger, more ideal policies than the small targeted subsidies. The powerfully represented, small targeted subsidies, will always be paying attention enough to fight back.

One recent example would be Section 8 Housing vouchers, a subsidized loan program to help low-income workers get houses and apartments. It was technocraticaly administered and a favorite of even fiscal libertarians. It was given the ax early in Bush’s term of of course. Now, Bush is proposing that exact thing to help poor people get on their feet in NOLA. If it’s a good idea policy-wise, why did it die while other items lives?

A concrete example would be when the leadership tried to slash farm subsidies by allotting less to the Agricultural-Subcommittee last spring. Of course, the Subcommittee just threatened to cut food stamps first. Now we all may have complaints about how food stamps should be allocated or redeemed, but few policy-analysts would say they have to go before farm subsidies do. But due to the way the committee structure is set up, and because there are no powerful defenders with a huge interest in bribing congressmen to defend food stamps (compared to farm subsidies), they get cut. If we interpolate to the future, if Democrats see a bill that tries to save for Hurricane Recovery by cutting programs they think are very important (food stamps) and pork (farm subsidies), they won’t view it as a compromise of losing one good thing and getting rid of some waste. They’ll see it as a false-carrot, knowing that the farm-subsidy cuts will disappear at some point in the process, and vote against it. Meaning the GOP has to work as hard as possible to eke out a majority. Meaning more concessions to borderline representatives, meaning more pork. The dreadful cycle continues until something finally get to the Conference Committee and then…

Oh God don’t get me started on Conference Committees.

It’s reminiscent of the Smoot-Hawley Tariff. When the Depression started, Herbert Hoover told Congress to write a new tariff bill because we had a lot of tariffs that were hurting our economy then. Every Congressman loved it, except they each added a little tariff for their district’s sectors and by the end… well the House Speaker snarkily replied “I said I was going to write a new tariff. I didn’t say it would be lower!”

And it’s the idea of “just give us some red pens” that is what is so funny. These people realize that the only way to save money is to have centralized and coldly rational control of the appropriations process. But they have no way to accomplish that. You can’t just simply cross out an earmark out that wastes money. That earmark could have been the key negotiating piece that got a bill through, or it could have been placed there by the Rules Committee Chairman who knows that he can’t let that “step on his turf” go unpunished.

To conclude: Our committee based appropriations process sucks, especially when it’s budget-trimming time.


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