What are “earmarks”, and what is all the fuss about them?

“Earmarks” in the federal budget have become one of the topics of discussion in the Presidential race. Senator John McCain frequently rails against them, and Senator Obama has shot back that McCain’s running mate has her own track record of requesting earmarks. All this despite the fact that earmarks represent only about 4% of the federal budget (excellent op-ed on this here: http://blogs.usatoday.com/oped/2008/09/squabbling-abou.html).

But what eactly are earmarks and how do they work? Earmarks can be found in federal and state budgets, which are passed as legislation by Congress or the state legislatures. An earmark designates a specific amount of money, out of a more general expenditure, for a particular project or program.

For example, let us imagine that in the federal budget for the Department of Defense, there is a budget line item for the (fictional) “Division of Nanotechnology Research”, with an appropriation of $30 million. The budget item might look something like this:

DIVISION OF NANOTECHNOLOGY RESEARCH

1234-5678………………………….For the operation of the division, including salaries, administration, research programs and grants for the purpose of developing methods of applying biologically-based technologies to further national defense………………………$30,000,000

If passed in this form, the Director of the Division gets $30 million to allocate as he or she deems appropriate to the various needs of the Division. Which makes a certain amount of sense, but also gives that person a  great deal of power. Legislators prefer to keep that power in their own hands. So, for example, a Congressman from North Dakota might prefer this language:

DIVISION OF NANOTECHNOLOGY RESEARCH

1234-5678………………………….For the operation of the division, including salaries, administration, research programs and grants for the purpose of developing methods of applying biologically-based technologies to further national defense; provided that $650,000 shall be expended for the Nanotechnology Research Program at the University of North Dakota………………………$30,000,000

The added phrase is an earmark which specifically sets aside $650,000 out of the $30 million total appropriation for the indicated program. The Director of the Division must spend that sum on that program, or not spend it at all.

It is easy to see how this type of thing can get out of hand. Every legislator wants to bring federal dollars to their own state or region. Federal programs can mean jobs and economic improvement for an area. However, there is no objective determination being made of the worthiness of the earmarked program compared to other contenders. Federal budget committee chairmen use these earmarks to reward their friends and lobbyists who support them, which can lead to wasteful spending on projects like the infamous Alaskan “Bridge to Nowhere”.

The problem is that if a legislator doesn’t secure these items for their district, they may be vulnerable to an opponent who promises to “bring home the bacon”. As a result, the overwhelming majority of legislators request earmarks to one degree or another. Senator McCain and a few others are very unusual in refusing to do so, and surviving in office nevertheless. Thus, it is too simplistic to condemn Obama, Biden, Palin, or any politician simply based on the dollar amount of earmarks they have requested. Instead, one really has to look at the actual projects and programs that funding was requested for. Were they wasteful giveaways or successful programs? Was the amount being requested for each reasonable or excessive? These questions are hard to answer for those of us who do not spend our time reading government budgets. We cannot be familiar with all these areas of government activity.

However, there are organizations which specialize in doing just that. Citizens Against Government Waste (CAGW) is a non-profit group dedicated to opposing “pork-barrel”, or wasteful earmarks and spending. They rate Senators and Congressmen based on certain key votes on spending bills and earmarks. Here are their 2007 ratings and lifetime ratings for McCain, Biden, and Obama, where 100% means the least wasteful and 0% the most wasteful:

McCain: 2007 100%, lifetime 88%

Biden: 2007 0%, lifetime 22%

Obama: 2007 10%, lifetime 18%

It’s important to note that these ratings are not measuring the earmarks a legislator requests or that actually make it into the budget. However, CAGW has created an “Earmark Reform Pledge” which they are asking legislators to sign, promising that they will fully disclose all the earmarks they request on their websites, and that they will not request funding for any project that does not serve a federal interest or that benefits a private entity and was not requested by a federal agency. As of March of this year, only 2 Senators and 8 Congressmen, all Republicans, have signed this pledge. McCain is not among them, though he might argue that since he requests no earmarks, it really doesn’t apply to him.

You can find out more about CAGW, their ratings and other activities at www.cagw.org.