Lawmakers in the 118th Congress again have the power to “bringing home the bacon” with federal dollars to specific projects in their home states and districts. Has transparency worked to provide scrutiny and limit potential abuse? TCS  Director of Research and Policy Josh Sewell and TCS Research Associate Chris Howe-Smith join host Steve Ellis for a critical update on Earmarks (see: Congressionally Directed Funding ).

Transcript

Announcer:

Welcome to Budget Watchdog All Federal, the podcast dedicated to making sense of the budget spending and tax issues facing the nation. Cut through the partisan rhetoric and talking points for the facts about what’s being talked about, bandied about and pushed to Washington, brought to you by taxpayers for common sense. And now the host of Budget Watchdog AF TCS President Steve Ellis.

Steve Ellis:

Welcome to All American Taxpayers Seeking Common Sense. You’ve made it to the right place for 30 years. TCS that’s taxpayers for common sense, has served as an independent nonpartisan budget watchdog group based in Washington DC We believe in fiscal policy for America that is based on facts. We believe in transparency and accountability because no matter where you are in the political spectrum, no one wants to see their tax dollars wasted. It’s May, 2024. And today we are here to bring you an update on what many now call Congressionally directed funding and some call community project funding, both an awkward alternative to the more commonly understood term of old earmarks as budget watchdog af Faithful know lawmakers in the hundred 18th Congress again have the power to be bringing home the bacon with the federal tax dollars to specific projects in their home states and districts. So what’s the latest? Has transparency worked to provide scrutiny and limit potential abuse? Joining us now to answer these questions and more are TCS Director of Research and policy, Josh Sewell and TCS research associate. Chris, how Smith, Josh and Chris, welcome to the

Josh Sewell:

Pod. Thanks Steve. Happy to be here. Thanks for

Steve Ellis:

Having me on. Alright, well let’s dive right in. Josh, I know we have a whole history of earmarks and an FAQ on our website, but for our listeners, please catch us up briefly with the history of earmarks, these special interest provisions inserted into the budget.

Josh Sewell:

Sure. The modern earmarking process began basically in earnest in the 1980s and it really peaked in 2005, I think you had about 15,000 earmarks at one point. That was the highest that I saw doing some research. And after that peak, there was a series of scandals that really helped usher in a new majority after the 2006 election. And it yielded some transparency reforms. And the big part there was where earmark sponsors the people who actually requested them and the beneficiaries, the individuals or entities that received the earmarks had to be disclosed. Before that folks like us had to dig through everything that Congress creates in order to find the earmarks, things that we would define as an earmark. So then after the 2010 election, there is another wave of reform coinciding with a new majority. And this time it was Republicans taking over as opposed to oh six when it was Democrats. And that new Republican majority in the house had an earmark moratorium and it kept that in place back and forth all the way until even 2021 when Democrats once again took over and they restored earmarks and they had a much different process than had existed before the moratoriums and the reforms. But they came back in 2021 and brought us close to where we’re today.

Steve Ellis:

Okay. So Chris, what were some of those restrictions in those reforms that are in the process right now from what we just did our database on?

Chris Howe-Smith:

So for each appropriations cycle, the House Appropriations Committee, which is the committee in charge of putting all these bills together, sends out guidance to all the members on what community projects that they can submit for consideration. And there’s a laundry list of guidelines, including things such as administrative considerations for how requests should be submitted, whether online in writing, what have you. It’s a more substantive criteria. So that includes a limit of 15 requests per member, which is an increase from the previous 10 requests per member. None of the recipients may be for profit and the member cant have financial interest in the recipient. And that’s among many other listed currently.

Steve Ellis:

Right. And the limit on only 15 is a House of Representatives limit. The Senate doesn’t have that same limit. And so that what kind of skews the numbers when you’re starting looking by chamber, by chamber. So Josh, Chris, now we know the rules of the road and I know that you all have been in the throes of databasing, these earmarks. So what is the tail of the tape?

Josh Sewell:

According to what the House and Senate disclosed as an earmark or congressionally direct spending community project funding as their most favorite way of calling it. Now there’s almost 15.8 billion worth of funding through 8,099 projects. And now we do a little caveat of 47 of those projects were actually things requested by the president in the Army Corps of Engineers budget and two in the Bureau of Rec. And those actually got more money than the president requested. And so those plus ups, as you call ’em, are one and a half billion dollars. So in our organizational definition of an earmark that we used to use before Congress had its own, we would really say there’s 14.3 billion across 8,052 earmarks, non-presidential earmarks. And so that’s the real number, 14 to 15 because in Washington you can never have just one number that everyone agrees on.

Steve Ellis:

Exactly. And we’ll get into some of that sort of teasing out what is in earmark, what isn’t, or what is community project funding or correctional directed spending. And for our podcast listeners, bureau of Rec is Bureau of Reclamation. So these are these big, the Corps of Engineers and big water projects. So that’s what those are about. Alright, so I mentioned about the difference between the house and the Senate limitations. So digging in a little bit, how did it work for both the House and the Senate?

Chris Howe-Smith:

That’s where things start to get a little bit more complicated. So if you want to look at what was included by just one house member, at least one house member, there were 4,697, which was just shy of $8 billion worth. And then there were slightly more earmarks from the senators with 4,800 some odd, but they got about a billion dollars more. So the senators had more and they also got significantly more money of those more, there were more that originated in the house, but they had senators who could come on and essentially provide a little bit more weight to them. And so members introduced 4,357, which got about 6.75 billion of which 10 were requested by the president. And then there were fewer that originated in the Senate for roughly 3,400. And that got about 6.6 billion of which 35 had presidential requests. And then there was also a nice bit of bicameral action on 318 of them, which got 920 million with an M. So it’s difficult to suss out where a lot of this began, but where people were working from. But that is the numbers that we were able to

Josh Sewell:

Find. And I have to say as someone who’s worked on earmarks or whatever you want to call them for a number of years, not as many as Steve, but a number of years in a number of different ways that they’ve been doing this, the disclosure is better than it used to be. And one of the things in the past for the longest time, you couldn’t necessarily say this earmark originated in the house or this earmark originated in the Senate. I mean you could see the bill if it was in there, but sometimes they typically as in this, they push ’em all together. And so it’s just they’re all in here. And so this, they actually have to, from the beginning to the end, take ownership of that earmark. And so you can say, oh, this actually originated in the house and this originated in the Senate and there’s only a handful that actually had an original letter or request from both the House and the Senate, which is what we saw in the past. In practice, you would often see, oh this, this was only in this bill and this is only in that bill, but now we know for a fact that there’s only 318 of the things they call earmarks or that they are disclosing that originated in both the House and the Senate. And unlike in the past, there’s nothing that just originated nowhere, which we would see in the past because everything has to be requested and you have to back it up with a formal request and some information. Alright, Josh put this

Steve Ellis:

Into a perspective. I mean one of the things you hear from people is this is a tempest in a teapot that essentially we’re putting a lot of concentration on, not that much money.

Josh Sewell:

Yeah, well, 15 billion, 16 billion, that’s still a lot of money. But yes, in fiscal year 2024, which is what we’re talking about, the current fiscal year, the stuff that was done started last March more or less and was finally finished, Hey, this last march more or less, and it’s 1.7 trillion in the discretionary budget out of a six and a half trillion dollars in outlays. So our government spent six and a half trillion dollars in fiscal year 2024 and 15 billion it was earmarked, was subject to an earmark. So it’s not a lot of money in context, but 15 billion is still a lot of money when it comes to the individual projects, when it comes to Congress’s time, when it comes to the political capital, this is one of the biggest complaints that we would hear from individuals who work for Congress was that how much time it takes to navigate earmark requests and then internally in the office and amongst your constituency and amongst your committee and then just amongst your caucus is just the amount of time that we spent working on earmarks is disproportionate, I would argue to their impact, but even more so disproportionate to the need for focus.

All that being said, it’s extremely important to tackle because you can’t get to 35 trillion in debt and you can’t get out of 35 trillion in debt unless you tackle literally every angle on every single aspect of the budget. And so earmarks and the earmark process has to be part of that, but just one of many parts.

Steve Ellis:

Well, I remember Josh, to your point after the disclosure rules in fiscal year 2008 when we did our first report under those, we named it ending the earmark ATM, and that was actually a quote from then Chairman of the appropriations committee, David Obie, a democrat from Wisconsin who said that he hated earmarks because even though he got ’em, because it turned members into an ATM machine for their districts and that they were disproportionately got the attention when there are bigger issues that need to be tackled. And so certainly you’ve mentioned even from a staff perspective, which we’d heard that during the moratorium, they were like, wow, we’ve got a lot of other things we can do now that we’re not actually requesting earmarks and trying to vet them or whatever. And we can tell people no without offending them because it’s like, I’d like to help you but I can’t because there’s this moratorium. Alright, so let’s get to some of the major policy points and issues around earmarks. One of the things that we’ve talked about before, some of these projects are laudable, some of these projects are important, but we don’t know in the overall context. So part of the problem is the process, not necessarily the product. Right, Josh?

Josh Sewell:

Absolutely. And we touch on that a little bit of that. It’s just if Congress is spending all of their time or even half of their time looking at earmarks, then they’re not spending time looking at the rest of the budget. And I mean, let’s be clear, we have a lot of really important things for Congress to do. There are a lot of major investments that need to happen. There are some major policy points that need to be sussed out federally. And so if you’re sitting here spending a lot of time narrowly deciding which of your constituents are going to get a construction grant or which one of your constituents are going to get an operations grant essentially from the federal government, then it means you’re not tackling either the big ideological things or also frankly, the big drivers of our debt that are coming down the pike, social Security and Medicare and even the smaller drivers of our debt. How do you design the programs to work for people so that they don’t have to hire lobbyists to get a special exception to get the funding? How do you create those formula processes and those grant processes to do the right things and to get the money out the door in a way that’s fair and equitable and obvious. It’s not necessarily that earmarks lead to corruption, which they do, which we can talk about especially in the past, but they are corrupting and they are distracting, and I think that’s what annoys me the most about earmarks.

Steve Ellis:

Right. Well, and as you said, I kind of alluded to some of the scandals or we alluded to the scandals that led to some of the reforms and certainly you had member congress trade as pins stripes for prison stripes, duke Cunningham from San Diego, you had super moral lobbyist, Jack Abramoff called the appropriations committee a favor factory, and before he got busted for being corrupt, then I would say the other big one was the bridge to nowhere, which wasn’t necessarily corrupt, but it was a huge waste of money and it was one that we highlighted and dubbed the bridge to nowhere. You can go on, but we’ll just stop there, Chris. It’s also that the process still isn’t that great, right?

Chris Howe-Smith:

Oh no, absolutely not. We spent the better part of the last two and a half, three weeks working on the data that we’re able to present. Now you talk about listeners glossing over reading all the numbers. It’s a lot to take in and that’s part of the nature of the beast there. And it’s good that we have more transparency. We can see who submitted requests and we can see all the information. There’s hundreds and thousands of pages being submitted online, which is good. It’s good for transparency, but that doesn’t mean that it’s perfect. The data is not displayed in the most user-friendly way. When the bills dropped, we drew this information from scanned PDFs of all of the pages from the appropriation spells. And so in order to make that into a more user-friendly way to look at all that information we had to painstakingly go through find transcription errors when we were able to bring it over onto our software to be able to actually read into and decipher the information that came out.

So it took time. And I’ll say in the ideal world, it shouldn’t have taken as long as it did. It’s great that we have that information. It’s great that our government gives us what it does, but it still should give more and give better. And so if we want to look at, and I think it’s right to be able to see what your member requested, to see where federal dollars are coming into your district, because with the earmarks process, that’s important to be able to see what your member’s doing. But we’ve taken many steps since you’re talking about the scandal written days of yesterday year, but we still have steps to take and we’ll see.

Josh Sewell:

Yeah, and I think since Chris wasn’t around, at least at TCS when we had earmarks back in 2008 to 2010, this disclosure process, it is better. Let’s be honest and be fair with the committees. Two things though, it’s only better because people like us have forced it to be better by constantly doing the oversight and criticizing them when it’s not transparent. But then also some of it’s been a learning process, but it’s more they can do better. We know that they do have this information in better formats, they just don’t release it. And actually just to get a little bit deep and nerdy, when they first released the disclosure tables, they were very poorly formatted and it’s like they had just scanned and threw ’em online because they had to get it done. Two days later we went back and checked and they had cleaner documents.

And so part of this is just Congress being more disciplined and sticking to its schedule so that their own members can look through this stuff and understand what’s going on, let alone the public before the members vote on it. It’s very frustrating as someone who’s done this for a long time to say, oh, we still don’t have a central database where you can just look at what everything was requested and then what went out. Because frankly, if you’re doing this, you should stay behind it. And if you love earmarks, then you should be proud of it and you should tell everyone about it. And don’t try to hide things either intentionally or even unintentionally. That’s my mini soap box. I’m not going to go on again.

Steve Ellis:

Well, I’m stepping up on that soapbox, Josh. You’re absolutely right. And we’ve heard from staff that they have these databases. They have to, because they’re tracking, they have to make sure that, okay, we’re not giving any lawmaker or a house member any more than 15 earmarks and it’s across a dozen bills. And so they have this information that they could make it available, they could put us out of business of databasing, and they should, because all we have to do is just have a downloadable, searchable, sortable database. And then it’s just telling the stories and running the numbers, and I’m not expecting them to tell us who got the most or anything like that. And so then also the thing is that, so that’s aggravating just the fact that they’re not providing this information that they have. But then also anybody who’s dealt with data realizes that garbage in, garbage out.

And so you have cases of where sometimes they use the state abbreviation, sometimes they write out the state, well, that affects your data. Sometimes they have typos or they put the data in different ways by the subcommittees. You would think there would be some standardization at least among the house and at least among the Senate, if not both. And so certainly that’s part of the frustration. But now I’ll step off the soapbox too, Josh, so much has been talked about how earmarks are this magic pixie dust that makes things work and that it makes everything flow. Well, we’ve seen that it didn’t happen when you had earmarks. It didn’t happen when you didn’t have earmarks, and it doesn’t seem to be happening when you do have earmarks, right?

Josh Sewell:

Yeah. I mean, unless you think that starting in 2001 partisanship really started going down and things got more easy to do in Washington, and clearly that is sarcasm. I know it’s not clear on coming across sometimes, but they are not solving partisanship. And I think we see this every election cycle someone says, or every single time we have gridlock like, oh, if only we had had earmarks or we had more earmarks, we could get things through. It’s like, well, I mean, they’re actually, frankly, even the earmark and the earmarks process is becoming part of the partisan or culture war fights now. And so they’re not magic. They’re another way of spending money. They’re not the best way of doing it. And I think it’s something that we could eliminate with better budgeting and better processes, and at the very least, we need to really make more transparent and pair it down. If not, I would completely eliminate it.

Steve Ellis:

So Josh, I mean, what are some of the negative consequences on the ground for ear marks?

Josh Sewell:

Yeah, the biggest thing for me is that it creates spending outside of any normal process. So whether that’s a competitive grant, whether that’s a formula program that we have set amount of funds that goes to states or entities based on some predetermined formula and law, these work outside of that process. And so it can create two tracks for funding. It’s the haves and the have nots. And we saw this in the past where you would have programs where as much as 50% or even 80% of times of the funding in that program was done through earmarks, and the rest was everyone else had the scraps that cut the compute over. So if you had the right lobbyist, you had the right access, or you were just lucky because your member of congress was on the committee or of jurisdiction, then hey, you got your project moved to the front of the line.

That’s not how it’s supposed to work, and it’s not efficient. Then the other thing about is that earmarks do not add to the budget. They take money away. And so you can say, oh, it’s only 14 $15 billion, but in a pool of funds, it could be a higher percentage of that fund. So everybody who’s competing for funds, they automatically have a smaller amount of funds to compete over because the earmark folks have jumped to the front of the line. And the final thing that we used to see a lot, and we’ll know more as we dig through the actual earmarks this year and what comes out next year, is that sometimes what’s earmarked isn’t what the state wants to do. We saw this in a highway bills a lot. You would sometimes you’d have an earmark for something that was not at a top tier priority for the state, but then you have to fund it. The money is tied to that project. And sometimes you’ll even see projects that are no longer wanted or are zombies because the state is no longer going to need that highway or they’ve changed direction, but the earmark is tied to that and you can’t just take the money and do something else with it. So it creates a whole nother process of redirecting zombie earmarks. So lots of reasons not really helpful.

Steve Ellis:

To your point, especially on the transportation projects, the Department of Transportation Inspector General back in, I think it was 2006, surveyed the state highway transportation officers and said that in a lot of cases that these earmarks were going to projects that were not the higher priority within the state. And then to your point about zombie earmarks, sometimes they wrote ’em wrong, and since they’re in the law with the wrong name, then they can’t spend the money on that particular project. And so it doesn’t cost anything per se, but it does seem to kind of gum up the works or be less efficient. And I’ll channel our colleague Gabe Murphy here. There’s a lot of things that aren’t called your marks or called community project funding or called congressionally directed spending. In some cases it’s because it’s going to for-profit entities, and I’m looking at the Pentagon when I’m saying that.

And so when Gabe went through the Defense Appropriations bill, he found more than a thousand program increases in procurement and RDT and E worth research development testing and evaluation worth 21 billion plus, and they weren’t disclosed. And those are going to for-profit entities. And that was always one of the major earmark pieces of legislation, certainly maybe not a number, but a dollar amount was the defense appropriations bill. These are still going on, but just because they’ve redefined what they are calling earmarks and they’re the judge, jury and executioner as to what is an earmark and isn’t an earmark are community project funding or congressionally directed spending, they’re able to kind of evade scrutiny in those areas and make it even less transparent and more opaque. Alright, so Josh, we had an unexpected retirement in the house appropriations and what’s going on there and what’s the result of that?

Josh Sewell:

So yeah, so a shift in leadership. Now you have Mr. Tom Cole from Oklahoma. He’s now the new chair of the House Appropriations Committee. He’s a long time member. He’s been around long before I even came to Washington, and he’s been on approach forever. But he, in light of some of the process for this last fiscal year, he has already immediately changed the earmark guidelines, basically saying that you can’t earmark to nonprofit entities in the economic development initiative account. And that sounds wonky, but essentially what it means is there was a controversy for some folks this last year where there were some funds that went to community development. So a lot of construction on some operations for various things that are providing social services. They were LGBT focused or they were some other thing that was not to the political liking of some members. And so then technically when you’re voting for the appropriations bill, you are in their minds endorsing these things.

And I think most of us think that’s not necessarily true. There’s big bills with a lot of stuff. It doesn’t mean you support everything, but so he immediately said, you can no longer do to these accounts. And so it’s caused some partisan reactions. The Democrats are quite upset about this, but also it has the effect of narrowing who can receive funds. And so this is how most of the funding that goes in here to YMCAs goes through that account. So these other things that have nothing to do in most of these places with any sort of partisan or even ideological bent, they’re going to lose some potential funding through this. And also, I think an interesting thing for people who a little bit inside baseball, his announcement came on, I think it was April 25th or April 28th, and earmarks were due on May 3rd. He gave people four business days to do it. We’re talking even 15 billion trying to move that and four business days is going to be tough. So it caused a lot of extra problems this time because it was just so quick and different.

Steve Ellis:

Four business days is not a lot of time to vet these projects and to pick and choose and make sure that it’s a good request. That’s coming from an individual lawmaker. Speaking of requests from individual lawmakers, let’s touch on some of the ones that may have stood out to you, Chris, any particular ones that we are favorite to flag for our listeners?

Chris Howe-Smith:

So as I was going through our spreadsheet, a town name stuck out to me and it stuck out to me because it’s where I was raised. And so I wanted to know what did Mr. Norcross of New Jersey’s first bring back to Haddenfield? And I saw that there was $500,000 allocated to our police department, but what stood out to me was where that funding was supposedly coming from, which was for the Rural Community Facilities Program. And that is a USDA program that stood out to me because we’re a suburb from 20 minutes outside of Center City Philadelphia. And so I flagged that for Mr. Agriculture since it was a USDA program. And he let me know that there was a definition of rural being used that meant that there were less than 20,000 people in the specific area. And in 2020, my hometown had roughly 12,000 people. So yes, it did meet the letter of law, but considering as a rural development, it didn’t really fit the spirit of the law so much. So that one really stuck out to me as an interesting example,

Steve Ellis:

Budget Faithful. I’m familiar with Haddenfield because my mother was raised in Hadden Township right next door. And so I certainly, it’s connected by the train to Philadelphia. My grandfather took me on that train to just ride aimlessly. And so certainly I know that that is not rural. And so in this case, as Chris mentioned, it technically meets the definition, but then the question is, do they need to redefine what is rural development, if that’s really what you’re trying, you’re intending and trying to get to. So that’s a good example. Thank you, Chris. Josh.

Josh Sewell:

Yeah, I think there’s a lot to go through in this. And so we’ve only sort of scratched the surface in our own research trying to get everything cleaned up so people could look at it when we can get it online. But one of the things, you started looking at states first, and I just thought we were the top 10 states and just the top five as far as money going to what Congress says, this is in this location. And typically it is. In fact, if it’s a facility or a military base, it’s in that one location. And so they’re mostly in an individual state. Occasionally it gets up, but California number one with over $1.05 billion, Florida’s number two at 900 million, Texas is third at just under 800 million. New York 650. And who’s number five? Maine, the great state of Maine. And so you’re like, how can Maine, nothing against Maine, a state that’s not very big by population or size have so much money. And it turns out while they have only four members of Congress, two in the Senate and two in the house. And so they have a lot of poll once they have some seniority. And also

Steve Ellis:

Just, you mean like Senator Collins who’s the ranking member of the appropriations committee?

Josh Sewell:

Yeah. How convenient. That’s one of those things where you look at, California has five and a half times the land size and 28 times the population, but only 50, 60% more earmarks. So it’s a question of are we actually spending money where it’s needed the most? And it’s pretty clear once you start digging through, it’s no, it’s not truly by merit. It’s not truly by need. It’s because of political power. And there’s also, there’s interesting things like, I don’t know why North Dakota doesn’t have a single earmark, which they have some very senior appropriator named Senator John Hogan who loves his spending. And I think you’re like, why don’t they have earmarks? And it’s like, we’ll have to figure that out. But probably because they’re going to raise their running through the regular approach process or manipulating the farm bill, which by the way, the farm bill is out now too. So we get to look at that.

Steve Ellis:

Got to squeeze that in.

Josh Sewell:

But also ultimately you can see we don’t have all of our numbers done even by now. But when we make this available, people can really dig through it as well and find their own stories. But appropriators do well and non-appropriators don’t do as well. That’s a theme we’ve seen every year. We’ve looked at earmarks. And for those Republicans in the house who are earmarking, they’re getting a lot of money because there’s quite a few of them who aren’t earmarking. And so it’s not like people who choose not to earmark that the money just goes back to the treasury. It’s actually in this context, it doesn’t necessarily restrain the other members. Josh

Steve Ellis:

Sewell. Chris, how Smith, thank you for being on the podcast. Great to be

Josh Sewell:

Here. It’s great to be here, Steve. Always appreciate it.

Steve Ellis:

And budget watchdog AF faithful, we’re still cleaning up the data and making sure that it looks good and it’s understandable and intelligible. And so look for that on taxpayer.net in the next week. So there you have at podcast listeners, if you know where to look when it comes to appropriations, there is oh so much to see. This is the frequency market on your dial, subscribe and share and know this taxpayers for common sense has your back America. We read the bills, monitor the earmarks, and highlight those wasteful programs that poorly spend our money and shift long-term risk to taxpayers. We’ll be back with a new episode soon. I hope you’ll meet us right here to learn more.