Trump’s Record on Spending Gets Worse Every Year

I wrote yesterday that the Trump tax plan is yielding significant benefits, but one of my caveats at the end of the column warned that Trump’s weak record on spending undermines the long-run sustainability of lower tax rates.

The latest example of Trump’s profligacy is the $1.4 trillion spending bill for the 2020 fiscal year that was just approved (this is the “discretionary” money for the parts of the budget that are annually appropriated, so keep in mind that there’s also more than $3 trillion of “mandatory” spending for entitlement programs in 2020).

This pork-filled spending bill became inevitable when Trump surrendered to the Democrats this summer and agreed to bust the spending caps (something politicians also did in 2013, 2015, and 2018).

It’s hard to capture the utterly reckless nature of the new spending bill.

Here’s how Senator Rick Scott described the legislation.

…a giant spending package — 2,313 pages long — that was…negotiated in secret, spends $1.4 trillion, and is chock full of member projects and special-interest giveaways. …more than $4,200 for every man, woman, and child in America. …This package includes $25 million for the “operation, maintenance, and security” of the Kennedy Center in Washington, D.C. It includes a $7.25 million increase in funding for the National Endowment for the Arts, the largest increase in a decade. …It includes more than $1 billion in new foreign-aid funding without any discussion about what we’re getting for this funding. …This bill spends $1.4 trillion, with no cuts or reforms. …How many more trillions of dollars do we need to spend before we wake up to the danger…? We need to reform the way Washington works, and we need to do it now.

The Wall Street Journal was similarly dismayed, opining about the bipartisan spending orgy and pointing out the real problem is that all this spending violates the Golden Rule of fiscal policy.

Congress has left town for the year but alas not before another bipartisan spending party that has typified the Trump Presidency. …The budget problem isn’t a shortage of revenue. CBO says tax receipts grew 4% last fiscal year, through September, and 3% in the first two months this year. Economic growth is feeding the Treasury. But spending is growing much faster: 8% last fiscal year, more than four times the inflation rate, and 6% in October and November this year. In addition to the latest discretionary bills, spending on Social Security (6%), Medicare (6.1%) and Medicaid (9.2%) continue to soar this year. Neither party shows any inclination to do anything about those programs, except expand them. Mr. Trump may yet join Barack Obama in the spending record books.

Regarding the final sentence in the above excerpt, I will predict now that Trump will exceed Obama’s profligacy.

And I’ll have the numbers to prove that early next year when I update my data on presidential spending.

In the meantime, I’ll close with this very depressing chart from the Committee for a Responsible Federal Budget.

The bottom line is that Republican big spenders are enablers of Democratic big taxers.

• In a couple of years, when there’s a big fight to get rid of the Trump tax cuts, every Republican who supported this awful deal (including Trump) will be responsible.
• When there’s a Democratic president and a big push for class-warfare taxes, every Republican who supported this awful deal (including Trump) will be responsible.
• When there’s a big fight after that to impose a European-style value-added tax, every Republican who supported this awful deal (including Trump) will be responsible.

Gee, isn’t bipartisanship wonderful?

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Should We Give Politicians the Power to Swap Campaign Cash for Corrupt Earmarks?

This is depressing.

Republicans botched the repeal of Obamacare. They’ve already sold out (twice!) on the spending caps in the Budget Control Act, and they’re about to do it again.

And now they want to bring back earmarks.

In this interview with Neil Cavuto, I explain why this is a very troubling development.

One thing I didn’t mention in the interview is that earmarks are inherently corrupt. Indeed, there’s a near-universal four-step process that – in a just world – would result in politicians getting arrested (see 18 U.S. Code § 203) for bribery, graft, and conflicts of interest.

1. An interest group decides it wants other people’s money and decides to use government as a middleman.
2. The interest group hires lobbyists, most of whom are former members of Congress or former staff members.
3. The interest group and the lobbyists direct campaign contributions to one or more politicians.
4. In exchange for those contributions, one or more earmarks are inserted in a spending bill.

That’s a great deal for Washington insiders, but not so good for taxpayers or honest government.

And if you don’t believe me, read about the oleaginous behavior of Senator Tom Harkin and Representative Jim Moran.

Now let’s consider an argument in favor of earmarks. Writing for Bloomberg, Professor Tyler Cowen of George Mason University argues that the system needs a bit of grease to work better.

…think of earmarks as local benefits inserted into bills to buy more votes in Congress. …Recalcitrant representatives can be swayed by the promise of a perk for their district. That eases gridlock…whether we like it or not, there is something inherently transactional about being governed.

As I stated in the interview, I don’t think this assertion is persuasive. Most legislation is bad for liberty, so I agree with America’s Founders that gridlock is good.

That being said, Tyler makes a couple of compelling arguments. First, he points out that we may need some pork to get good legislation through the process.

Advocates of smaller government should keep in mind that reforming spending and regulation requires some activism from Congress. Gridlock today is not the friend of fiscal responsibility, coherent policy, or a free, well-functioning capitalist economy.

I agree with the first sentence and said the same thing in my talk with Neil. We will need congressional action to reform entitlements and save the country. And if that means bribing a few members to get votes, so be it.

However, I think his second sentence is too optimistic. Good reform is not very likely with Trump in the White House. It’s a judgement call, to be sure, but I believe gridlock will be a good thing for the next few years.

Second, Tyler acknowledges that politicians try to buy votes, but he suggests that earmarks are cheap compared to potential alternatives (such as new entitlements, presumably).

…virtually every member of Congress looks to support government spending that will boost his or her re-election prospects. It is often the case that directly targeted local spending — which may take the form of earmarks — buys support for a relatively low dollar price per vote. If earmarks are removed, representatives are still going to pursue votes, but the total amount of electorally motivated, wasteful government spending may be higher.

This is a potentially persuasive point, but I’ll be skeptical until I see some supporting evidence.

In a gridlock environment, I suspect enacting non-earmark spending is not that easy (though I admit an Obamacare-level budget buster every 10 years would completely wipe out in just one year the money that might be saved over several decades with an earmark ban).

In addition to what Tyler wrote, another pro-earmark argument is that there will always be a person who decides how money is spent. And I’ve had members of Congress tell me that they’d rather make those decisions that have a bunch of left-wing bureaucrats allocate money.

That’s a perfectly reasonable argument, but it doesn’t address my fundamental concern that the existence of earmarks will seduce members into supporting higher overall levels of spending.

Which brings me to my final point. I’m willing to cut a deal.

I’m willing to let politicians allocate 100 percent of spending with earmarks if they’ll agree to a comprehensive spending cap that complies with the Golden Rule and slowly but surely shrinks the overall burden of federal spending.

If the crowd in Washington is serious about the argument that earmarks are needed to grease the skids for desirable legislation, it’s time for them to put their votes where their mouths are.

Given the track records of most of the politicians who support earmarks, I’m not holding my breath.

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Great Moments in Pentagon Incompetence and Waste

Last month, I explained that America’s fiscal problems are almost entirely the result of domestic spending programs, particularly entitlements.

Some critics immediately decided this meant I favored a blank check for the Pentagon, even though I specifically stated that “I’m very sympathetic to the proposition that trillions of dollars that have been misspent on foreign adventurism this century.”

Moreover, if they bothered to do any research, they would have found numerous columns on Pentagon waste, including here, here, here, here, and here.

Indeed, I get especially upset about military boondoggles precisely because national defense is a legitimate function of government.

I want money being spent in ways that will minimize the threat of an attack on the United States, not on the basis of padding jobs in a particular politician’s hometown or in response to clever lobbying by a defense contractor.

Unfortunately, wasting money is what government does best. And it happens at the Pentagon just as often as elsewhere in the federal behemoth.

Let’s look at a recent exposé about Pentagon profligacy in the Washington Post.

The Pentagon has buried an internal study that exposed $125 billion in administrative waste in its business operations amid fears Congress would use the findings as an excuse to slash the defense budget… Pentagon leaders had requested the study to help make their enormous back-office bureaucracy more efficient and reinvest any savings in combat power. But after the project documented far more wasteful spending than expected, senior defense officials moved swiftly to kill it by discrediting and suppressing the results. …Based on reams of personnel and cost data, their report revealed for the first time that the Pentagon was spending almost a quarter of its $580 billion budget on overhead and core business operations such as accounting, human resources, logistics and property management. …the Defense Department was paying a staggering number of people — 1,014,000 contractors, civilians and uniformed personnel — to fill back-office jobs far from the front lines. That workforce supports 1.3 million troops on active duty, the fewest since 1940.

Here’s a rather sobering chart from the story.

Predictably, bureaucrats in the military tried to cover up evidence of waste and inefficiency.

…some Pentagon leaders said they fretted that by spotlighting so much waste, the study would undermine their repeated public assertions that years of budget austerity had left the armed forces starved of funds. Instead of providing more money, they said, they worried Congress and the White House might decide to cut deeper. So the plan was killed. The Pentagon imposed secrecy restrictions on the data making up the study, which ensured no one could replicate the findings. A 77-page summary report that had been made public was removed from a Pentagon website.

Here’s a final excerpt from the story. The “no one REALLY knows” quote is rather revealing.

“We will never be as efficient as a commercial organization,” Work said. “We’re the largest bureaucracy in the world. There’s going to be some inherent inefficiencies in that.” …while the Defense Department was “the world’s largest corporate enterprise,” it had never “rigorously measured” the “cost-effectiveness, speed, agility or quality” of its business operations. Nor did the Pentagon have even a remotely accurate idea of what it was paying for those operations… McKinsey hazarded a guess: anywhere between $75 billion and $100 billion a year, or between 15 and 20 percent of the Pentagon’s annual expenses. “No one REALLY knows,” the memo added. …the average administrative job at the Pentagon was costing taxpayers more than $200,000, including salary and benefits.

Let’s close with some blurbs from other stories.

Starting with some specific examples of waste from a recent story by U.S. News & World Report.

The Special Inspector General for Afghan Reconstruction has uncovered scandal after scandal involving U.S. aid to that country, including the creation of private villas for a small number of personnel working for a Pentagon economic development initiative and a series of costly facilities that were never or barely used. An analysis by ProPublica puts the price tag for wasteful and misguided expenditures in Afghanistan at $17 billion, a figure that is higher than the GDP of 80 nations. …A Politico report on the Pentagon’s $44 billion Defense Logistics Agency notes that it spent over $7 billion on unneeded equipment. …overspending on routine items – such as the Army’s recent expenditure of $8,000 on a gear worth $500 – continues.

Let’s also not forget that the Pentagon is quite capable of being just as incompetent as other bureaucracies.

Such as forgetting to change the oil on a ship.

The USS Fort Worth, a Navy littoral combat ship, has suffered extensive gear damage while docked at a port in Singapore. …According to reports, the crew failed to use sufficient lube oil, leading to excessively high temperatures on the gears. Debris also found its way into the lubrication system, which also contributed to failure, Defense News reports. The crew did not follow standard operating procedures.

And accidentally allowing a missile to get shipped to the hellhole of communist Cuba.

An inert U.S. Hellfire missile sent to Europe for training purposes was wrongly shipped from there to Cuba in 2014, said people familiar with the matter, a loss of sensitive military technology that ranks among the worst-known incidents of its kind. …officials worry that Cuba could share the sensors and targeting technology inside it with nations like China, North Korea or Russia. …“Did someone take a bribe to send it somewhere else? Was it an intelligence operation, or just a series of mistakes? That’s what we’ve been trying to figure out,” said one U.S. official. …At some point, officials loading the first flight realized the missile it expected to be loading onto the aircraft wasn’t among the cargo, the government official said. After tracing the cargo, officials realized that the missile had been loaded onto a truck operated by Air France, which took the missile to Charles de Gaulle Airport in Paris. There, it was loaded onto a “mixed pallet” of cargo and placed on an Air France flight. By the time the freight-forwarding firm in Madrid tracked down the missile, it was on the Air France flight, headed to Havana.

And let’s not forget about the jaw-dropping absurdity of an intelligence chief who isn’t allowed to…um…see intelligence.

For more than two years, the Navy’s intelligence chief has been stuck with a major handicap: He’s not allowed to know any secrets. Vice Adm. Ted “Twig” Branch has been barred from reading, seeing or hearing classified information since November 2013, when the Navy learned from the Justice Department that his name had surfaced in a giant corruption investigation involving a foreign defense contractor and scores of Navy personnel. …More than 800 days later, neither Branch nor Loveless has been charged. But neither has been cleared, either. Their access to classified information remains blocked. Although the Navy transferred Loveless to a slightly less sensitive post, it kept Branch in charge of its intelligence division. That has resulted in an awkward arrangement, akin to sending a warship into battle with its skipper stuck onshore. …Some critics have questioned how smart it is for the Navy to retain an intelligence chief with such limitations, for so long, especially at a time when the Pentagon is confronted by crises in the Middle East, the South China Sea, the Korean Peninsula and other hotspots.

The bottom line is that any bureaucracy is going to waste money. And the bureaucrats in any department will always be tempted to care first and foremost about their salaries and benefits rather than the underlying mission.

So I’m not expecting or demanding perfection, regardless of whether the department has a worthwhile mission or (in most cases) shouldn’t even exist. But I do want constant vigilance, criticism, and budgetary pressure so that there’s at least a slightly greater chance that money won’t be squandered.

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Wasteful Spending, Cost Overruns, and the Never-Ending Victimization of America’s Taxpayers

Here’s a simple rule. When a politicians says a new program will cost X, hide your wallet because it actually will cost three or four times as much. Or even more.

Obamacare is a particularly painful example from recent history.

Simply stated, politicians and bureaucrats routinely under-estimate costs because they figure once a project or program is underway, voters can be tricked into throwing good money after bad.

It happens all the time in Washington. And it happens in other nations as well.

And even though I’m a fan of decentralization, that doesn’t mean I’m oblivious to the fact that state and local governments are very capable of similar behavior.

Consider, for example, the streetcar project in our Washington, DC. The main problem is that taxpayers are getting reamed. The current price tag, according to a report in the Washington Times, is about $3 billion.

And what are taxpayers getting for that “investment”?

So far, based on a story in one of the city’s other newspapers, the Washington Post, they’re getting long delays.

In the early 2000s, an ambitious band of city officials set out to cut through the bureaucratic mire and launch a vast streetcar network that would be a model for the nation, eventually running 20 to 40 miles or more. The first leg was supposed to open in 2006. But as 2015 comes to a close, officials are scrambling toward their latest goal of opening a diminished, 2.2-mile streetcar line.

But major delays are just the tip of the iceberg.

The Post‘s report highlights how one small part of the project – a maintenance facility for the streetcars – has become symbolic of grotesque cost overruns and waste.

The District is spending three or four times what other cities have to build a maintenance facility for its fledging streetcar system… The “Car Barn” project was originally designed as a simple garage and rail yard for light repairs and storage, with some offices for staff. But it has ballooned in ambition and nearly tripled in cost — to $48.8 million. It will now include a number of pricey and unusual features, including grass tracks for parking the fleet of six streetcars and a cistern for washing them with rainwater. …The District says it…is projected to open in 2017 after long delays. Tucson spent $13 million. Cincinnati’s was $11.5 million. Seattle’s came in at $11.1 million.

I’m sure local taxpayers (plus taxpayers around the nation that also subsidized this farce) will be happy to know they paid for a solar roof and other useless quirks.

Here are some of the details on why costs exploded.

…the building has…become a teaching tool for how public projects can be saddled with immense new costs. The historic designation “prompted an immediate six-month stop-work order,” DDOT said, and required, along with the green building rules, numerous upgrades. Those included using stone and brick materials; adding a saw-toothed roof with skylights; and hiding a streetcar power supply under photovoltaic cells and behind “green screen walls.” …Among the other major additions was an intricate system of turf tracks and paving stones that allow rainwater to drip into an underground vault for storage and filtering before flowing toward the city’s storm-water pipes.

Though taxpayers may think the “drip” is the sound of their money being flushed down a toilet.

In 2011, under Mayor Vincent C. Gray (D), the District estimated it would spend $6.2 million on a maintenance yard and a temporary shelter — basically, a big tent. Then, with the temporary tuneup location in place, the permanent building, additional track and other work in the yard would be finished for an additional $10.7 million. …The yard-and-tent total grew to $10.4 million, DDOT said, including environmental work and hundreds of thousands of dollars to keep some Dean-Facchina workers on the job 12 hours a day, six days a week to speed things up. By last year, estimates for the second phase, including the permanent Car Barn, had risen to $24 million. In July, the city agreed to spend $38.4 million on this phase, bringing the total to $48.8 million. Among the unforeseen costs listed by DDOT are $1 million in storm drainage and $824,000 in “indirects.”

So what’s the bottom line?

Well, the late former Mayor of DC, Marion Barry, is not normally a credible source. And I’m not sure I trust any numbers that came out of his mouth.

But I suspect he ventured very close to the truth when he was quoted in a Washington Times story from 2014.

…the late former Mayor Marion Barry said D.C. taxpayers would be spending $2,000 to subsidize each ride, calling it “a streetcar to nowhere.”

In other words, it would have been cheaper to hire chauffeured limousines for the handful of people who will use the streetcar. Assuming, of course, it ever gets opened.

By the way, there must be something in the local water, because there’s a similar example of grotesque waste on the other side of the Potomac River.

But let’s not just pick on profligate local governments.

Never forget that the federal government is the real expert at waste.

National Review has a very depressing list of ways that Uncle Sam has been squandering our tax dollars.

Federal spending gets more ridiculous every year, and a new congressional report details 100 of the most egregious examples. Following in the footsteps of chronic-waste chronicler Tom Coburn, Oklahoma senator James Lankford published “Federal Fumbles” late on Monday afternoon. …Here are NR’s top-ten favorite — which is to say, most scoff-worthy and absurd — examples of how the government wastes your time, energy, and hard-earned cash.

Here are some of the highlights, though lowlights might be a better term.

…the Department of Defense…approved a $283,500 grant to monitor the day-to-day life of baby gnatchatchers. …the U.S. National Institutes of Health…announced it would grant some hapless grad student $48,500 to pen the definitive history of smoking in Russia over the past 130 years. …the National Science Foundation…gave Massachusetts Institute of Technology more than $400k to ponder the burning question: “Does media choice cause polarization, or does polarization cause media choice?” …five federal agencies alone spent $3.1 billion on workers placed on administrative leave in a two-year timespan. A lot of that cash — $775 million, to be exact — went to public employees banned from their desks for more than a month. …The National Park Service forked over $5,000 to Mars Hill University so it could make a documentary film about a local musician. …$65,473 to figure out what bugs do near a lightbulb…$35,000 for solar-powered beer.

To be sure, these items are just a drop in the bucket compared to entitlement spending.

And these examples of pork-barrel waste also are minor compared to all the supposedly non-controversial outlays that are part of the discretionary budget that funds various agencies and departments.

That being said, keep the above list in mind the next time some politicians says that we need more taxes to finance ever-bigger government.

And never forget that the real waste is when governments spend money on things that should in the private sector or civil society.

In other words, the real waste is about 80 percent-90 percent of what happens in Washington.

P.S. If you have a strong stomach, you can watch some short videos on government waste here, here, here, and here.

P.P.S. And some egregious additional example of waste can be perused here, here, and here.

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Another Victory for Fiscal Responsibility: The Death of Earmarks

I wrote a few days ago that advocates of smaller government have won a very significant victory over the past five years, as measured by the fact that there’s been zero growth in overall federal spending.

And because the private economy has grown while the federal budget has been flat, this means that the burden of government spending – measured as a share of GDP – has declined.

This doesn’t mean our fiscal problems are solved. Indeed, the long-run numbers are still horrible and we desperately need genuine entitlement reform to avoid becoming a failed European-style welfare state.

But a long journey begins with a first step and the spending freeze over the past five years is worth celebrating.

And let’s also celebrate the fact that members of Congress no longer have carte blanche, generally using “appropriations” legislation, to specifically allocate spending for campaign contributors and other favored constituencies. Such spending allocations, known as “earmarks,” have been banned ever since the GOP took the House in 2010.

That makes me happy. As I wrote after that election, earmarks facilitate bad policy.

…earmarks are the proverbial apple in the congressional Garden of Eden. Members who otherwise might want to defend taxpayers are lured into becoming part of the problem. …earmarks [are] a “gateway drug” that “seduces members into treating the federal budget as a good thing that can be milked for home-state/district projects.” …they finance a racket featuring big payoffs to special interests, who give big fees to lobbyists (often former staffers and Members), who give big contributions to  politicians. Everyone wins…except taxpayers.

You’ll notice, though, that I didn’t really offer any supporting evidence four years ago.

So it’s time to rectify that oversight. The easy evidence to cite is that the federal budget hasn’t grown over the past five years, but there are several reasons for that spending freeze.

While I think the earmark ban deserves some of the credit, let me share a couple of anecdotes that also show why it was good to end this odious version of pork-barrel spending.

Here are some excerpts from a Northern Virginia news report about the looming retirement of a member of the Appropriations Committee.

U.S. Rep. Jim Moran departs Congress unrepentant on the need for those much-maligned targeted budget items known as earmarks. Moran – who once famously, if jokingly, promised to “earmark the shit out of” the federal budget if Democrats regained control in Congress – told the annual meeting of the Inter-Service Club Council of Arlington that the spending measures that used to be inserted at the behest of individual members of Congress should be brought back.

You may be wondering why this is newsworthy. After all, it’s hardly a shock that a big spender likes earmarks.

But it’s this next excerpt that makes the key point.

Why is he leaving? At the luncheon, Moran expanded on earlier frustrations. “Congress as an institution is dysfunctional,” he said. “Life’s too short to be part of an institution that only produces frustration.” Things were different when Moran first was elected to Congress in the early 1990s.

In other words, Cong. Moran got frustrated and decided to quit (at least in part) because he no longer had the ability to play favors and raise campaign cash by doling out earmarks.

Gee, it’s almost enough to make you cry with sympathy. I’m sure taxpayers are very sad that Congressman Moran won’t be prowling the halls of Congress any longer.

And it’s a double tragedy because he won’t have as much value as a lobbyist since he can’t finagle earmarks from his former colleagues. Oh, the humanity!

And keep your hankie ready, because our next story also is a tear-jerker. It’s from before the election and it’s about outgoing Senator Tom Harkin of Iowa and his refusal to share his stash of campaign cash with fellow Democrats.

Despite direct appeals from Senate Majority Leader Harry Reid of Nevada and other top Democrats, Harkin has refused to transfer money from his $2.4 million campaign account to the Democratic Senatorial Campaign Committee, according to sources and campaign finance records.

So why did Harkin decide to hoard his campaign cash, even though he was retiring from politics?

Because the poor fellow wasn’t allowed to subsidize his own ego with a taxpayer-funded earmark and had to use money from his contributors instead.

…the retiring Iowa senator has informed party leaders that he plans to use the campaign funds for a charitable contribution to an entity that bears his name: The Harkin Institute for Public Policy and Citizen Engagement at Drake University in Des Moines, according to sources close to discussions with the senator. …the ban on congressional earmarks…has prevented him — a senior member of the Senate Appropriations Committee — from steering money to Drake University, said Democratic sources. Finding a home for his official papers has been a priority for Harkin, who has served in the Senate for three decades after 10 years in the House.

Gosh, no wonder Harry Reid wants to bring back earmarks. If politicians can steal from taxpayers, they’ll have more money available to win elections!

Which is another reason why the earmark ban should be preserved.

P.S. Want another argument against earmarks? Well, how about the fact that reporters at the Washington Post think President Obama would have been able to push through more gun control if he could have used earmarks as bribes.

P.P.S. I want to switch topics and close by giving readers a riddle.

What would happen if you scrambled the genes of George W. Bush and David Cameron (the Prime Minister of the United Kingdom) and produced two new people, sort of like Danny DeVito and Arnold Schwarzenegger in Twins?

The answer is that you’d get Calvin Coolidge and Richard Nixon.

Allow me to elaborate. I’ve previously pointed out that George W. Bush was a reckless big spender, but at least he was somewhat consistent in advocating lower taxes.

David Cameron is the opposite. I’ve groused about his disturbing affinity for tax hikes, but he’s been much better on spending than I thought he would be.

And he’s about to get even better according to Allister Heath of the U.K.-based Telegraph.

…this government is a free marketeer’s dream. It believes in cutting spending as a share of GDP much more severely than any previous government had dreamed of. On that metric, it is more Thatcherite than Thatcher, more Reaganite than Reagan. Public spending is expected to fall to 35.2pc of GDP by 2019-20, the lowest level in at least 80 years. …When looking just at the Government’s consumption of goods and services, the state’s relative size will fall to levels last seen in 1938, according to a historical Bank of England dataset. …the aspiration is revolutionary.

Considering that government spending in the United Kingdom was consuming more than 48 percent of GDP as recently as 2009, it truly would be a dream if the burden of the public sector dropped to “only” 35 percent of economic output.

That surely would earn the U.K. a spot on my list of nations that have complied with Mitchell’s Golden Rule for multi-year periods.

Returning to my riddle, Danny DeVito and Arnold Schwarzenegger supposedly had the same genetic stock in Twins, but one of them somehow got the bad genes and the other one got the good genes.

So I’m speculating that the genes of Bush and Cameron, scrambled together, would produce one good politician who believes in lower spending and lower tax (i.e., Coolidge) and one bad politician who supports higher taxes and bigger government (i.e., Nixon).

P.P.P.S. Here are my most recent numbers showing which modern Presidents were the most frugal and most profligate.

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Wasting Money Is Washington’s Favorite Activity

It’s unfortunate that Senator Tom Coburn is retiring. He hasn’t been perfect, but nobody can question is commitment to limited government. He’s been a rare voice in Washington against wasteful spending.

And he’s going out with a bang, having just released the 2014 edition of the Wastebook.

It’s a grisly collection of boondoggles and pork-barrel spending, highlights (though lowlights might be a better term) of which can be seen in this video.

The good news is that the American people increasingly recognize that Washington is a cesspool of waste, fraud, and abuse.

A Gallup Poll from last month, for instance, finds that folks are quite aware that a huge chunk of the federal budget is squandered.

There are two interesting takeaways from this polling data.

First, it’s good to see that there’s been a steady increase in the perception of waste in Washington. That shows people are paying more attention over time. In other words, more and more Americans recognize that the public sector is a sleazy racket for the benefit of bureaucrats, lobbyists, contractors, politicians, cronies, interest groups, and other insiders.

Second, it’s also worth noting that there’s less waste at the state level and even less waste at the local level. These are just perceptions, to be sure, but I suspect people are right. Money is less likely to be squandered when people have a greater opportunity to see how it’s being spent. Which is why federalism is good policy and good politics.

Now let me add my two cents. Government waste doesn’t just occur when money goes to silly projects. From an economic perspective, money is wasted whenever there is a misallocation of potentially productive resources.

And that’s a pretty accurate description of most of the federal budget. Not just discretionary programs, but also entitlement programs.

Here’s my video providing the theoretical arguments against excessive government spending.

And here’s the companion video that reviews the evidence showing that big government undermines prosperity.

And if you want another video, but one that shows horrific government waste presented in an amusing manner, click here.

And if you instead want to get heartburn by reading about disgusting examples of waste, click here, here, or here.

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An Aggravating Reminder of Government Waste on Tax Day

Remember the Spending Quiz from 2010, which asked people to guess whether absurd examples of government waste were true or false?

Well, we have a new video on government waste, though bureaucrats and politicians have become so profligate it doesn’t even bother to trick people with fake examples.

While very well done, I do have two small complaints about the video.

First, it asks whether we should cut spending or raise taxes to deal with the national debt. I think that’s too narrow. We shouldn’t be wasting money even if the budget was balanced and there wasn’t a penny of debt.

In other words, the problem isn’t deficits. Red ink is just a symptom. The real problem is that government is too big.

Second, the video sort of acquiesces to the dishonest Washington terminology by asking whether we should cut spending or raise taxes, implying those are the only two options. I favor genuine spending cuts, of course, but the most accurate way of phrasing the question is to ask whether we should cut spending, restrain spending, or let government grow on auto-pilot.

As I explained earlier this year, we can balance the budget in just 10 years if spending grows “only” 3.4 percent per year. When people understand that detail, there’s almost no support for higher taxes.

But I’m nitpicking. Overall, a very good video.

P.S. If the examples of pork-barrel spending in the video get you angry, you’ll probably have a stroke if you also watch the waste video from the folks at Government Gone Wild.

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Great Moments in Government Waste

Taxpayers all across America send lots of money to Washington, DC, in part because we’re supposed to believe that redistribution is a legitimate and desirable function of the federal government.

But this is a very perverse form of redistribution. All that money going to Washington helps subsidize a network of overpaid bureaucrats, fat-cat lobbyists, corrupt politicians, and well-heeled interest groups.

Indeed, as shown in this map, 10 of the 15 richest counties in the country are in the Washington metropolitan area.

One of those wealthy areas is Arlington County, VA, just across the river from Washington. Home to thousands of federal bureaucrats and other DC insiders, Arlington is similar to Washington in that there is a lot of wasteful spending. Sort of makes you wonder if local bureaucrats and federal bureaucrats ever meet at bars after work and brag about who wasted the most money that day?

Anyhow, here are some sordid details from a Washington Post story.

A wall made of etched glass opens the rear vista to newly planted landscaping. Embedded in the floor are heating elements intended to ward off the cold weather and keep winter-weary feet cozy. …And the price tag: $1 million. “Is this made of gold?” asked commuter Yohannes Kaleab, examining the concrete-and-stainless-steel bench that is part of the new, seven-figure bus shelter. “What?” asked Robin Stewart as he learned of the cost of the structure while waiting for a bus there last week. “That’s ridiculous. From a citizen, from a voter, whoever put that budget through needs to get their butt canned. It’s an outrage.” The “super stop,” which opened March 11, is the first of 24 new bus stops that will also accommodate Arlington’s long-planned streetcars. …It will shelter 15 people at a time.

$1 million for this bit of glass, metal, and concrete?!?

That sounds kind of expensive, but we can be comforted by the fact that thoughtful public servants predict future savings.

“When you do a prototype, you end up heavily front-loading on the costs,” said Dennis Leach, Arlington’s transportation director.

So how much will taxpayers save on the remaining 23 stops? Well, the good news is that they won’t cost $1 million each. The bad news is that the government doesn’t exactly save a lot of money when doing bulk purchases.

“Our goal if at all possible is to do it for less,” Leach said. The county has budgeted $20.8 million for the remaining 23 stops, or about $904,000 for each one.

Gee, knock me over with a feather. The additional bus stops will “only” be $904,000!

That’s not counting cost overruns, which are an inevitable reality with government budgeting, so I think it’s safe to assume that the final cost will be far higher.

So why do governments waste money like this?

Part of the answer, of course, is that politicians are inherently wasteful. But there’s another factor at play. Politicians are especially wasteful when they can spend money that isn’t collected from their own taxpayers.

And readers from other parts of America doubtlessly will be overjoyed to learn that their paying for a big chunk of this boondoggle.

Federal and state transportation money paid 80 percent of the costs.

With taxpayers outside of Arlington paying such a high share of the cost, we should think of ourselves as lucky that the bus stop didn’t cost $10 million!

But here’s the most amazing part of the story.

What’s the most important part of a bus stop? In theory, a bus stop can be nothing more than a sign indicating the spot where you should wait for a bus.

But if you’re going to build a structure, the most valuable feature – at least from the perspective of riders – is that you will be protected from the weather. So what sort of protection are riders getting as a result of this $1 million boondoggle? Meh, not so much.

…the bus shelter is “pretty, but I was struck by the fact that if it’s pouring rain, I’m going to get wet, and if it’s cold, the wind is going to be blowing on me. It doesn’t seem to be a shelter. It doesn’t really shelter you very much . . . you can get pretty soaked in two minutes.” Her opinion was shared by some on Columbia Pike trying it out.

Gee, isn’t this wonderful. Some contractors doubtlessly lined their pockets building this white elephant. Some consultants doubtlessly fattened their bank accounts with all the nonsense that is now part of the “planning” process.

But taxpayers, as usual, got the short end of the stick. They got taken for a ride, figuratively. And if they actually use the bus stop, they can get taken for a ride, literally, so long as they don’t mind getting wet.

P.S. And let’s not forget that Obama wants some more class-warfare tax hikes to finance more of this “investment.”

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Somebody Should Tell Politicians that the Military Budget is for National Defense, not Pork and Political Correctness

I agree with George Will that it’s okay to reduce Pentagon spending. After all, the United States accounts for almost one-half of the world’s military outlays, about twice as much as the combined total of possible enemies.

But I also agree that national defense is one of the few legitimate functions of the federal government, so I want to make sure we get the most bang for the buck (no pun intended) from every penny.

That’s why I get especially irritated when I read horror stories about Pentagon waste.

But in many cases, it’s not the fault of the Generals and Admirals. America’s military is forced to waste money because the politicians in Washington are motivated by cronyism, corruption, pork, and political correctness.

For example, let’s look at an excerpt from a column in the Washington Examiner.

Imagine you’re a legislator in a country with a bloated budget of almost $4 trillion and a record level of spending that requires massive deficits and could mean job-killing tax increases. Now imagine you’ve got a weapons program that is billions over budget, a decade behind schedule and unwanted even by those for whom it is intended. What would you do? If you said, “Earmark the program another $380 million,” you’re apparently qualified to serve on the U.S. Senate Appropriations Committee. The weapons program is the Medium Extended Air Defense System, a joint venture with Germany and Italy that was zeroed out by three of four relevant congressional funding authorities. But the Senate Appropriations Subcommittee on Defense decided the program was worth a $380 million earmark, and the full committee passed the final bill along with a unanimous vote.

I’m not an expert on weapons systems. Heck, I know less about such matters than Obama’s cabinet knows about the economy. But it certainly seems foolish to throw good money after bad on a program that doesn’t work. Especially when the military doesn’t want it!

And here are a couple of sentences from a Forbes column about part of the military budget being diverted to subsidize solar power.

EPA regional headquarters?

The U.S. Army is looking for a few good renewable energy projects. Some $7 billion worth. On Tuesday the Army began accepting bids for green energy installations that will be deployed on military bases and facilities across the U.S. The Army will sign contracts to buy the electricity generated by solar, wind, geothermal and biomass projects for up to 30 years. …The program is part of a Department of Defense initiative to meet at least 25% of energy demand on its bases from renewable sources by 2025. The military is also aiming its bases to become “net zero” consumers of electricity – generating more power than they use by installing solar and other renewable energy systems.

Silly me. I thought the Pentagon was responsible for keeping the nation safe. I guess I missed the memo where it was tasked with being a tool for the green agenda.

These examples doubtlessly are just the tip of the iceberg. Politicians can’t resist turning anything they touch into a vehicle for graft, waste, and foolishness.

To be sure, there are also big picture issues of national security that have to be resolved. Is NATO now an anachronism, as Steve Chapman persuasively argues? Is overseas intervention a pointless exercise, as Mark Steyn explains?

But whatever the mission, the Pentagon’s ability to carry it out is compromised when politicians treat the military budget like a goodie bag.

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Great Moments in Government Waste

Every time some class-warfare Democrat or Charlie Brown Republican says we need higher taxes, I think of all the ways the government wastes money and I get angry because the political elite is ripping off the American people.

Should we send more money to Washington when the federal government is:

• Forcing taxpayers to pay millions of dollars for pro-Obamacare and pro-IRS propaganda.
• Doing interviews about erectile dysfunction for $6,000 each and sticking the tab on us.
• Hiring bureaucrats to monitor school lunches and replace healthy turkey sandwiches with processed chicken nuggets.

And those are just examples of nickel-and-dime programs. The bigger outrage is that politicians have created costly, inefficient, and bankrupt entitlement programs that threaten our fiscal future.

But the small examples have symbolic value, and now I have something new to add to the list. The idiots at the State Department thought it was just fine and dandy to pay 35 times the market price for some Kindles.

“Hey, let’s stimulate the economy by paying 35 times the retail price!”

IPads are too fancy, Nooks aren’t fancy enough, but Kindles are just right for teaching English, the State Department thinks, which is why it bought 2,500 of them from Amazon in a $16.5 million no-bid contract, NextGov’s Dawn Lim reports. That works out to $6,600 per Kindle Touch — a lot more than the $189 retail price. The plan, according to Kim, is to send the e-readers to “designated libraries and U.S.-friendly educational centers around the world.”

Since your paying for this ripoff, you might be a tad bit irritated. But that’s only because you’re an unsophisticated taxpayer. According to PR hacks, we really are getting a good deal because of all the extras in the agreement. Put down your coffee or soda before reading this passage from the report because I don’t want to be responsible for liquid on your computer screen.

Amazon is responsible for shipping the Kindles, providing 24-7 customer service, sharing data on how the Kindles are used to access content and pushing serialized content to the Kindles regularly. Amazon is also responsible for disabling “standard features, as as [sic.] requested by DoS, for the device such as individual purchasing ability.”

Wow, free shipping. That’s worth a lot. And the customer service surely adds a couple of bucks per unit, not to mention the extra pennies it must cost to disable features and provide electronic updates.

But let’s not be too hard on clueless bureaucrats. Maybe they just don’t understand high tech. After all, moronic government officials paid more than $22,000 each for big institutional Internet routers hooked up to just a handful of computers.

It’s almost enough to make you think government spending is the problem rather than the solution.

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At Least the Federal Government Is Competent at Waste, Inefficiency, and Duplication

I sometimes get accused of being too libertarian. One leftist blogger even said my views are insane.

So I decided to show my open-mindedness by finding a way to praise big government. It took a bit of head scratching, but I think I discovered something that is impressive, sort of.

As you can see in this chart prepared by the Republican Study Committee, the federal government is remarkably effective at wasting money with duplication and featherbedding.

But I don’t want to be chintzy in my praise of the federal government. If you look at the areas where there is the most duplication and waste, you’ll find programs for energy, housing, and education – all of which are areas where the Constitution does not authorize spending and intervention by the federal government. So let’s also praise the politicians in Washington for their agility in sidestepping the system set up by the Founding Fathers!

And let’s not be shy about crediting the political elite for shoulder-to-the-grindstone diligence. It takes a certain dedication – or something like that – to continue to pour money into these programs when all the evidence suggests federal involvement in education has undermined outcomes, that federal housing programs helped cause the financial crisis, and that federal energy programs have become cesspools for cronyism.

I know I’m guilty of sometime posting absurd examples of government stupidity. I hope today’s post shows that I’m capable of looking at the positive side of government.

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Notwithstanding Tea Party Election in 2010, Republicans on Capitol Hill still susceptible to Big-Government Virus

I’ve written before about the importance of getting rid of the Department of Transportation, and I’ve also written about Republicans getting in bed with big government.

So you can imagine how agitated I was to read this article about transportation spending at National Review. Written by Andrew McCarthy, it shows that the GOP still has a long way to go before cleansing themselves of the big-government corruption of the Bush-Rove years. Here are some nauseating passages.

The problem is not the GOP infighting. The problem is the GOP. Republicans are simply not interested in limiting government or addressing our death spiral of spending. …The federal government should not be in the transportation business at all. A federal role was rationalized in the mid-Fifties to finance the construction of interstate highways. As National Review’s editors observed in 2005, that project was completed in the early Eighties, at which time the fuel tax that funded it should have been repealed and the upkeep of highways left to the states. “Instead,” they wrote, “Congress morphed the program into a slush fund for some of its most indefensible pork-barrel spending.” …see how easily a “highway system” morphs into a “transportation system.” The taxes that Leviathan confiscates from drivers, purportedly for road construction and maintenance, are actually redistributed to subsidize other forms of transit preferred by progressives — including walking. For that, you can thank Republicans. With a compassionate wink from President Bush, the Republican Congress enacted an obscene $286.5 billion transportation bill in 2005… SAFETEA-LU featured all the uglies that outraged voters into telling the GOP to take a hike in the 2006 and 2008 elections. These included Alaska’s infamous $250 million “Bridge to Nowhere,” one of the bill’s 6,376 earmarks totaling $24 billion — you know, the sorts of budget-busting recklessness Republicans promised us they’d sworn off in order to get elected in 2010. …And now that the “Pledge to America” crowd that promised to stop the madness is back in charge, what do you suppose the plan is? Why, to persist in the madness. Team Boehner, whose “pledge” to voters explicitly promised “to stop out-of-control spending and reduce the size of government,” proposes to continue funding transportation at “current levels” for the next five years, which translates to an additional budget shortfall of about $60 billion dollars. So much for decrying “Washington Democrats [who] refuse to listen to the American people and eliminate, restrain, or even budget for their out-of-control spending spree.” …Naturally, conservatives who expected Republicans to do what they promised are apt to go ballistic. So, just as in the debt-ceiling fiasco, the establishment’s plan is to dazzle the rubes with some smoke-and-mirrors. On the debt ceiling, it was phantom cuts that would occur, um, someday. This time around it is a commitment to ramp up oil and gas production, the additional revenues from which, we’re told, will alleviate the transportation burden. …The brute fact is that today’s Republican establishment does not believe in limited government. “Limited government” is a slogan reserved for campaigns and fund-raising drives. The idea is not to rein in big government; it’s to hold the reins of big government.

Amen. Every time someone posts a comment or sends an email to complain that I’m too mean to GOPers, they should read this column. Principles should come first, not the self interest of a political party filled with corrupt hacks.

Yes, I realize that “corrupt hacks” is a bit unfair and over the top. After all, these are the folks who voted last year for real entitlement reform, so I need to remind myself that politicians are combinations of good and bad.

But this transportation bill shows what happens when the bad part is running amok.

And it teaches us a lesson that it is not progress to replace big-spending Democrats with big-spending Republicans.

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Newt Gingrich Wants to Send Our Wallets and Purses into Outer Space

I was nauseated when Newt Gingrich did the infamous global warming ad with Nancy Pelosi.

I was disgusted when he criticized Paul Ryan’s entitlement reforms.

But I’m not sure what my reaction is to Newt’s latest brain fart. For lack of anything clever, let’s just say I’m bemused by his proposed galactic boondoggle.

Here are some of the absurd details for a Politico report.

Newt Gingrich wants to colonize the moon. …“By the end of my second term, we will have the first permanent base on the moon and it will be American,” Gingrich said… It’s just the kind of Gingrich big-think for which he has been ridiculed by others in the GOP field, including Mitt Romney. But Wednesday’s speech — which Gingrich himself called “grandiose” — could actually resonate politically in Florida, where space exploration is good politics… Gingrich even envisions a moon state. “When we have 13,000 Americans living on the moon, they can petition to become a state,” he said, drawing laughter from the crowd. …But Gingrich’s space fantasies don’t stop at the moon. He wants to see trips to Mars by 2020. “By the end of 2020, we will have the first continuous propulsion system in space capable of getting to Mars in a remarkably short time because I am sick of being told we have to be timid and I am sick of being told we have to be limited in technologies that are 50 years old,” he said.

But I’m not just bemused. To use Newt’s rhetoric, I am sick of politicians coming up with new ways to spend my money and I am sick of being told by the clowns in Washington that my wallet is a pinata to fund their grandiose dreams.

If Newt likes space travel and wants a base on the moon and trips to Mars, then he should take some of the money he “earned” as Freddie Mac’s “historian” and invest it in a space company.

About 10 days ago, I was in the British Virgin Islands, speaking at a conference that was keynoted by Sir Richard Branson of the Virgin empire. Branson is doing what Newt wants, but in an ethical fashion. He’s using private money to set up a profit-making space-travel business.

Too bad politics and ethics are mutually exclusive concepts.

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Big Spenders Gone Wild

Last month, I shared a video about bloated bureaucracy from a group called Government Gone Wild.

That generated a big response, so here’s another video from the same group, only this one looks at egregious examples of government waste.

If you like videos on wasteful spending, but prefer a more attractive narrator, click here.

And if you want a video that looks at the economic cost of excessive government spending, watch this mini-documentary on the Rahn Curve.

We’ve reached a point where even economists from the welfare state of Sweden are producing studies showing there’s a negative relationship between government spending and economic performance.

One can only hope this message seeps through the thick skulls of the political class before it’s too late.

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Sequestration Does Not Endanger America’s National Security

The left wanted to get one thing from the Supercommittee, and that was to seduce gullible Republicans into a 1990-style tax increase deal in order to enable bigger government.

But I was pleasantly surprised when GOPers failed to surrender, which means that taxpayers didn’t get raped and pillaged. But winning a battle is not the same as winning a war.

The real fight is now whether the sequester is allowed to happen. In other words, will politicians preserve the provision that will automatically slow the growth of the federal budget so that spending over the next 10 years  grows by about $2.0 trillion rather than $2.1 trillion.

This may not seem like much of an achievement, but it is a very important indicator of what will happen in the future. If we want to protect against higher taxes in the long run, we need to figure out how to restrain government spending.

At the very least, this means following Mitchell’s Golden Rule so that the private sector grows faster than government. This would slowly but surely shrink the burden of federal spending as a share of economic output, though actual spending cuts would be preferable and they would more quickly get us where we need to be.

The main obstacle to the sequester, at least on the right, is that it would slow the growth of the defense budget. According to recent calculations, the Pentagon budget would increase by only about $100 billion over the next 10 years if the sequester is implemented.

That might not be enough to keep pace with inflation, and some are wondering whether this puts America’s national security at risk. But  this chart, which was developed by Cato Institute colleagues, shows that the United States dominates global defense spending.

Not only does the United States account for 48 percent of total defense spending, our allies in Europe and the Pacific Rim account for another 24 percent of military outlays.

And even if we use an absurdly expansive definition of possible enemies (Russia, China, all of Central/South Asia, and the entire Middle East and Africa), the military expenditures by those nations and regions don’t even amount to one-fourth of the world total.

More important, the combined spending by all potential adversaries is only about one-half of what the United States is spending, and only one-third of the combined spending of the United States and our allies.

This isn’t an argument for blindly slashing the defense budget. Nor is it an argument that says a sequester is the best way to prune military spending. But it certainly suggests that some modest restraint won’t put America in danger.

Moreover, perhaps the sequester will trigger some much-needed analysis of how best to protect America’s national security.

Maybe Mark Steyn and Steve Chapman are correct and it is time to revisit our spending on NATO, an alliance that was put together to fight the Warsaw Pact, an adversary that no longer exists.

Perhaps it means we shouldn’t spend huge sums of money to defend South Korea, which is far richer and stronger than its crazy northern neighbor.

Or maybe it means that the United States shouldn’t be engaged in nation-building exercises that exacerbate anti-American sentiment in other nations.

I’m not a defense/national security expert, so I don’t pretend to know the right approach to all of these issues.

But I have some familiarity with the way things get done in Washington. Politicians, lobbyists, interest groups, and bureaucracies will all act like the world is coming to an end if budgets are not endlessly expanded. That’s just as true for the Pentagon as it is for all other parts of the federal government.

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Here’s a Powerful Example of Why Obama’s “Stimulus” Proposal for more Infrastructure Spending Should Be Rejected

As part of his latest “stimulus” scam, President Obama argues that the federal government should spend more money on infrastructure.

Yet there is widespread evidence that politicians use such projects to squander money – often in exchange for contributions from contractors and construction unions.

There’s a very unfortunate example of this phenomenon in my backyard. Fairfax County is part of a $7 billion (that’s not a misprint) project to extend the metro (subway) system to Dulles Airport.

The project is way over budget (which happens 99 percent of the time with government spending projects).

But what’s really remarkable is that supporters of the boondoggle now admit they lied to taxpayers.

What’s noteworthy isn’t the lie. Heck, they always lie and underestimate costs (and then pretend the subsequent cost-overruns were unpredictable and unforeseen).

But not many proponents actually ‘fess up and admit that taxpayers were intentionally deceived.

Here is some of what the DC Examiner said in an editorial denouncing the duplicity and mendacity of the project’s chief bureaucrat.

Metropolitan Washington Airports Authority Chairman Charles Snelling finally admitted that he deliberately misled the public when he stated it was “beyond dispute” that Dulles Rail was “on time and on budget.” Turns out it is neither — a fact Snelling and his fellow MWAA Board members knew all along, stripping the last pretenses of transparency and accountability from one of the largest infrastructure projects in the nation. Snelling later acknowledged that construction managers warned MWAA that the opening of Phase I would be delayed six months and that unexpected expenses were depleting the project’s contingency fund. …Snelling’s less-than-candid assurances were an attempt to deprive taxpayers of a true accounting of this runaway project before November’s county and state elections. But what do you expect when you sever the critical tie between voters and officials with the authority to spend public funds? Unaccountable political hacks like MWAA board members, who cannot be removed — even by the governor of Virginia — have no incentive to spend the people’s tax dollars wisely — or even to tell them the truth, for that matter.

 The answer, at least in part, is to do the opposite of what Obama is proposing. Abolish the Department of Transportation and get the federal government out of the business of funding local infrastructure.

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Just in Case You Need One More Reason Why the Department of Housing and Urban Development Should Be Abolished…

Welcome Instapundit readers. If you want to get even more upset, here’s a big list of posts about waste, fraud, and abuse, including one about Social Security bureaucrats enjoying a $700,000 junket and another about a lawyer getting $25,000 of “stimulus” money for writing a two-sentence memo.

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While I’ve been somewhat critical of Senator Coburn’s willingness to raise taxes, I’ve never doubted that he is a sincere and tireless fighter for smaller government.

Indeed, his staff periodically share examples of government waste that boggle the mind, though I don’t share many of them on the blog since I’m afraid people will become desensitized to the sleazy boondoggles that are so beloved by lawmakers.

However, the last email from Senator Coburn’s office included a story that shows, in a rather remarkable fashion, how a bloated federal government has a corrupting impact on the rest of society.

According to a Wisconsin newspaper, a local governments is trying to “sell” federal funds, sort of like how I used to scalp football tickets as a student.

River Hills, Milwaukee County’s richest suburb, has found little use for what has become an annual allocation of about $20,000 in federal community development block grant money. So village leaders instead have cut deals with other suburbs to lend or transfer the grant money and have even sought unsuccessfully to sell the River Hills block grant allocation to another community. …Assistant Corporation Counsel John Jorgensen said selling the HUD allocation wouldn’t break any rules or laws, as long as the grant money is used for allowable projects. In a memo to county supervisors, Jorgensen said his opinion matched advice he’d gotten from local HUD officials. But Sullivan said the Milwaukee field office had questioned the practice in the past. Officials from the Milwaukee office of the Department of Housing and Urban Development declined to comment.

The Department of Housing and Urban Development has always been near the top of my list of government entities that should be shut down. This latest scam is merely the cherry on the ice-cream sundae of the argument to eliminate HUD as soon as possible.

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Bad News for Barack Obama, Tom Friedman, and other Statists Who Want to Use Taxpayer Money to Play with Trains

It’s not too surprising to learn that spending money on “high-speed” rail is foolish. And it’s hardly a revelation to learn that politicians over-promise and under-deliver when they push through these boondoggles.

My Cato colleague, Randall O’Toole, has written extensively about these money-losing white-elephant projects. But it’s not exactly shocking news that libertarians would resist wasteful government spending.

But it is stunning when establishment leftists admit that such programs are a mistake.

Here are excerpts from a column by Charles Lane, an editorial writer for the Washington Post. Yes, your eyes are not deceiving you. Even folks at the Washington Post are recognizing (or at least beginning to recognize) that government is a giant sink-hole that squanders tax dollars and undermines prosperity.

Today, Liu Zhijun is ruined, and his high-speed rail project is in trouble. On Feb. 25, he was fired for “severe violations of discipline” — code for embezzling tens of millions of dollars. Seems his ministry has run up $271 billion in debt — roughly five times the level that bankrupted General Motors. But ticket sales can’t cover debt service that will total $27.7 billion in 2011 alone. Safety concerns also are cropping up. …On April 13, the government cut bullet-train speeds 30 mph to improve safety, energy efficiency and affordability. The Railway Ministry’s tangled finances are being audited. Construction plans, too, are being reviewed. Liu’s legacy, in short, is a system that could drain China’s economic resources for years. So much for the grand project that Thomas Friedman of the New York Times likened to a “moon shot” and that President Obama held up as a model for the United States. …China’s train wreck was eminently foreseeable. High-speed rail is a capital-intensive undertaking that requires huge borrowing upfront to finance tracks, locomotives and cars, followed by years in which ticket revenue covers debt service — if all goes well. “Any . . . shortfall in ridership or yield, can quickly create financial stress,” warns a 2010 World Bank staff report. Such “shortfalls” are all too common. Japan’s bullet trains needed a bailout in 1987. Taiwan’s line opened in 2007 and needed a government rescue in 2009. …the Beijing-Tianjin line, built at a cost of $46 million per mile, is losing more than $100 million per year. …On the whole, I’d say China should envy us.

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Yes, We Should Cut the Defense Budget

There are very serious ways to save huge amounts of money from the defense budget, largely by making smarter choices about defining America’s national security.

This obviously involves high-profile decisions about whether it is smart to engage in nation-building in Iraq and Afghanistan. But it also involves what seem to be “gimme” choices about whether we should be spending tens of billions of dollars to maintain troops in places such as Germany, the United Kingdom, South Korea, and Japan.

And, sometimes, it’s just the simple fact that bureaucracies like to squander money. Here’s a $600,000 boondoggle that barely rises to the level of a rounding error in the Defense Department’s budget, but it is a nauseating example of how government wastes our money in genuinely spectacular ways. Every time some politician says we need to raise taxes, you should think of this piece of you-know-what and  say #*&@;^ No!

Here are the key passages from a U.S. News and World Report story.

A $600,000 frog sculpture that lights up, gurgles “sounds of nature” and carries a 10-foot fairy girl on its back could soon be greeting Defense Department employees who plan to start working at the $700 million Mark Center in Alexandria, Va. this fall. That is unless a new controversy over the price tag of the public art doesn’t torpedo the idea. Decried as wasteful spending that will be seen by just a couple thousand of daily workers who arrive on bus shuttles, foes have tried to delay the decision, expected tomorrow, April 1. But in an E-mail, an Army Corps of Engineers official said that the decision can’t be held up because it would impact completion of the huge project. …The Mark Center is one of the facilities that thousands of defense workers will be reporting to as part of the Base Realignment and Closure plan, or BRAC, that is shifting workers around Virginia and Maryland. The BRAC plan itself has been criticized as wasteful.

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Harry Reid Wants Me (and You) to Subsidize Cowboy Poetry in Nevada

Taxpayer-funded cowboy poetry? Is this an example of when parody becomes reality? Or is it the other way around, when reality becomes parody?

All I know for sure is that it is nauseating that the corrupt crowd in Washington thinks it is not only proper, but also praiseworthy, to steal money from the rest of the nation to fund vote-buying gimmicks in their home states.

Here’s a blurb from Politico about Harry Reid and his boondoggle.

In the middle of his tirade against House Republicans’ “mean-spirited” budget bill on the Senate floor Tuesday, the Senate Majority Leader lamented that the GOP’s proposed budget cuts would eliminate the annual “cowboy poetry festival” in his home state of Nevada. …“The mean-spirited bill, H.R. 1 … eliminates the National Endowment of the Humanities, National Endowment of the Arts,” said Reid. “These programs create jobs. The National Endowment of the Humanities is the reason we have in northern Nevada every January a cowboy poetry festival. Had that program not been around, the tens of thousands of people who come there every year would not exist.”

I must have an out-dated version of the Constitution, because my copy doesn’t say that cowboy poetry is one of the enumerated powers of the federal government.

I suppose a caveat is appropriate. I realize that I’m not the most sophisticated guy in the world. I wouldn’t recognize good poetry from bad poetry. I’d rather chew on broken glass than attend an opera. My idea of a good time is playing softball with a bunch of guys, talking sports and swapping jokes.

So I’m not attacking poetry in general or cowboy poetry in particular. But I am objecting to federal subsidies for such events. I don’t ask other people to subsidize my softball. All I ask in exchange is that they don’t coerce me into subsidizing their hobbies.

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The Moochers Fight Back

The fiscal fight on Capitol Hill has triggered a firestorm of lobbying, as greedy special interests are squealing about a potential loss of handouts.

This USA Today story focuses on funding for the Corporation for Public Broadcasting and Planned Parenthood, both of which are whining that the world will come to an end if they can no longer stick their snouts in the public trough.

But it doesn’t matter whether you like watching Sesame Street or what you think about abortion. This is a debate about whether funding those activities in a proper function of the federal government. If we can’t stop mooching in these areas, we may as well surrender now and start learning French or Greek.

Planned Parenthood, public radio stations and scores of other interests are scrambling to make their cases heard on Capitol Hill, hiring new lobbyists, mailing petitions, buying TV ads and, in one case, deploying PBS’ Arthur the Aardvark cartoon character to Congress to rescue the Corporation for Public Broadcasting from budget cutters. A focus of the lobbying free-for-all: a House-passed bill to fund the government through Sept. 30 that would cut $61 billion in federal spending. …The Corporation for Public Broadcasting, which helps fund public radio and television stations, has “outlived its usefulness,” said Rep. Doug Lamborn, R-Colo., who authored legislation to cut the funding. The corporation is set to receive $430 million this year. “In this day and age, we have 150 cable channels and the Internet over our cellphones,” Lamborn said. “We no longer need a government source of media. This seems to be a natural place to start the discussion about getting our fiscal house in order.” Patrick Butler, head of the Association of Public Television Stations, called the measure a “mortal threat” and said it would do little to reduce this year’s $1.6 trillion federal deficit. …Planned Parenthood receives $330 million annually from Medicaid and the family planning program, spokesman Tait Sye said. Planned Parenthood officials say no federal funds are used for abortions, but opponents say the federal support frees up money to perform the procedure. Rep. Mike Pence, R-Ind., a strong opponent of abortion, pushed the measure. “He doesn’t believe the nation’s largest abortion provider should be the largest recipient of federal funding under Title X,” Pence spokesman Matt Lloyd said. …The lobbying frenzy over the budget won’t end soon. President Obama, who threatened to veto the House-passed bill, and congressional leaders are working to negotiate a new spending bill to keep the government running past midnight March 18. Even if they can reach a deal to fund agencies through the Sept. 30 end of the current fiscal year, another confrontation lies ahead — this one over the fiscal year 2012 budget, which Obama sent to Congress last month.

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Requiring a Permit to Be a Bum?!? Great Moments in Government Stupidity

Since I’ve spent the past 25 years analyzing government, I’m used to spectacular levels of waste and incompetence. Examples of pork such as “$27 light bulbs” and the “turtle tunnel” barely cause me to raise an eyebrow.

It takes something really amazing to grab my attention, so I’m almost grateful to Ike Leggett, the head bureaucrat of Maryland’s Montgomery County. He has restored my faith in the extreme foolishness of the political class with a proposal that would require bums to get a panhandling license from the government.

Montgomery County Executive Ike Leggett is pushing for a state law that would allow the suburb to ban all roadside solicitation without a permit.

Just think of the new bureaucracy that could be created! Imagine all the new patronage jobs, the new forms that would be required, and the new leases to be signed!

Best of all, think of how much fun it will be to fleece taxpayers to pay for this nonsense. Other bureaucrats and politicians will be jealous of Ike for this new racket.

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Talking about Earmarks and the “Carousel of Corruption” on Taxpayer-Subsidized Radio

Since I’m involuntarily forced to finance National Public Radio, I guess I should be happy that free-market views occasionally are allowed on air. Click here to listen to a segment where I talk about earmarks, “phonemarks,” and special interest corruption in Washington.

The risky part of a pre-recorded interview is that you never know what the journalist will use. If the person interviewing you is biased, they can use a quote out of context to make you appear stupid, or use an incomplete quote to distort the meaning of your words. That did not happen in this case. The NPR interviewer, at least to my ear, was quite fair.

I wish the segment had been longer, however, so I could have explained why even “honest” earmarks are wrong. Let’s say that Congressman Smith or Senator Jones inserts an earmark, or makes a phonemark, to get funding for a sewer system. It’s quite possible that such a request is completely untainted by corruption (other than the run-of-the-mill practice of trying to buy votes with other people’s money).

But that doesn’t make it right. One of the reasons why federalism is such a good idea is that money is much more likely to be spent wisely is if it is raised at the state and local level and people at those levels decide how it should be allocated.

This doesn’t mean there is no corruption, insider deal-making, or special-interest shenanigans. That’s an inevitable part of government. But federalism at least makes it easier for people to monitor how their money is being spent – and to escape if they think their state or local government is going overboard with bad behavior.

In other words, centralization of government is a bad idea. This is why big government in Washington is worse than big government at the state and local level. And it’s why big government from the European Union in Brussels is worse than big government in Rome, Berlin, or Stockholm.

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Taxpayers Got a Big Christmas Present Yesterday, but It Wasn’t the Tax Bill

There’s a lot of attention being paid to yesterday’s landslide vote in the House to prevent a big tax increase next year. If you’re a glass-half-full optimist, you will be celebrating the good news for taxpayers. If you’re a glass-half empty pessimist, you will be angry because the bill also contains provisions to increase the burden of government spending as well as some utterly corrupt tax loopholes added to the legislation so politicians could get campaign cash from special interest groups.

If you want some unambiguously good news, however, ignore the tax deal and celebrate the fact that Senator Harry Reid had to give up his attempt to enact a pork-filled, $1 trillion-plus spending bill. This “omnibus appropriation” not only had an enormous price tag, it also contained about 6,500 earmarks. As I explained in the New York Post yesterday, earmarks are “…special provisions inserted on behalf of lobbyists to benefit special interests. The lobbyists get big fees, the interest groups get handouts and the politicians get rewarded with contributions from both. It’s a win-win-win for everyone — except the taxpayers who finance this carousel of corruption.”

This sleazy process traditionally has enjoyed bipartisan support, and many Republican Senators initially were planning to support the legislation notwithstanding the voter revolt last month. But the insiders in Washington underestimated voter anger at bloated and wasteful government. Thanks to talk radio, the Internet (including sites like this one), and a handful of honest lawmakers, Reid’s corrupt legislation suddenly became toxic.

The resulting protests convinced GOPers, even the big spenders from the Appropriations Committee, that they could no longer play the old game of swapping earmarks for campaign cash. This is a remarkable development and a huge victory for the Tea Party movement. Here’s part of the Washington Post report on this cheerful development.

Senate Democrats on Thursday abandoned their efforts to approve a comprehensive funding bill for the federal government after Republicans rebelled against its $1.2 trillion cost and the inclusion of nearly 7,000 line-item projects for individual lawmakers. …Instead, a slimmed-down resolution that would fund the government mostly at current levels will come before the Senate, and Reid and Minority Leader Mitch McConnell (R-Ky.) said it will pass by Saturday. …The majority leader’s surrender on the spending bill marked a final rebuke for this Congress to the old-school system of funding the government, in which the barons of the Appropriations Committee decided which states would receive tens of millions of dollars each year. …Almost every Senate Republican had some favor in the bill, but as voter angst about runaway deficits grew before the midterm elections, Republicans turned against the earmark practice.

This is a very positive development heading into next year, but it is not a permanent victory. Some Republicans are true believers in the cause of limited government, but there are still plenty of corrupt big spenders as well as some Bush-style “compassionate conservatives” who think buying votes with other people’s money somehow makes one a caring person.

In other words, fiscal conservatives, libertarians, and Tea Partiers have won an important battle, but this is just one skirmish in a long war. If we want to save America from becoming another Greece, we better make sure that we redouble our efforts next year. Eternal vigilance is the price of liberty.

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Earmarks are the Gateway Drug to Big Government Addiction

I haven’t commented much on earmarks, but an oped in today’s Washington Post was has goaded me into action. A former Reagan Administration appointee (the Gipper must be spinning in his grave), who now makes a living by selling our money to the highest bidder, made several ridiculous assertions, including:

…earmarks are largely irrelevant to balancing the budget. The $16.5 billion Congress spent on earmarks in fiscal year 2009 sounds like a lot, but leaves a minuscule footprint – about 1 percent of 2009’s $1.4 trillion deficit. Those seriously concerned about deficits should look elsewhere for meaningful spending reductions. …On Capitol Hill, party leaders must appeal to lawmakers’ interests as well as their principles to get the votes they need. The leaders must be able to offer incentives – such as earmarks – to win votes on difficult issues. Earmarks are not the only possible incentives, nor do they need to be the most compelling ones. But they are a tool for taking care of members who might otherwise stray.

The author is right that earmarks technically are not a big share of the budget. But he conveniently forgets to address the real issue, which is the degree to which earmarks are the proverbial apple in the congressional Garden of Eden. Members who otherwise might want to defend taxpayers are lured into becoming part of the problem. This is how I described the process in a recent PolitiFact article.

Daniel Mitchell, a senior fellow with the libertarian Cato Institute, …adds that the existence of earmarks increases the upward pressure on federal spending indirectly, since lawmakers “know they need to support the relevant powers on the spending committees in order to have their earmarks approved.” Mitchell calls earmarks a “gateway drug” that “seduces members into treating the federal budget as a good thing that can be milked for home-state/district projects.”

Since the author of the Washington Post column is trying, at least in part, to appeal to advocates of smaller government, I’m also puzzled that he says earmarks are good because they help grease the wheels so that more legislation can be passed. Does he really think reminding us about the “Cornhusker Kickback” and “Louisiana Purchase” will make us more sympathetic to his argument? Yes, it’s theoretically possible that congressional leaders will use earmarks to help pass legislation shrinking the burden of government. It’s also possible that I’ll play centerfield next year for the Yankees. But I’m not holding my breath for either of these things to happen.

Last but not least, earmarks are utterly corrupt. The fact that they are legal does not change the fact that they finance a racket featuring big payoffs to special interests, who give big fees to lobbyists (often former staffers and Members), who give big contributions to  politicians. Everyone wins…except taxpayers.

This is one of the many reasons why I did this video a couple of years ago with the simple message that big government means big corruption.

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A Spending Quiz from the “Rebel Economist”

My former Heritage Foundation colleague has returned to youtube.com with a video asking taxpayers whether examples of government waste are true or false.

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Great Moments in Government Waste

I’m sure if you read the Constitution with enough imagination, you’ll find (perhaps in invisible ink) the section stating that the federal government is supposed to provide subsidies to help specific companies market soap made out of goat milk. But my imagination isn’t that strong, so my reaction to this story is that the federal government already has too much money and that the crooks in Washington should not be allowed to raise taxes by even one penny.

A small business in Santa Fe has received a federal grant to help market its natural soaps and lotions. U.S. Senator Tom Udall, D-NM, and Terry Brunner, state director of the U.S. Department of Agriculture Rural Development, held a celebration ceremony for Milk and Honey Soap LLC to highlight the USDA’s Value Added Producer Grant program. The company received $12,500 to market its products. …Daven Lee, owner of Milk and Honey Soap, sells soaps and lotions made from goat milk and beeswax online and at the Santa Fe Farmers Market. She will use the funds to expand her marketing efforts, with the idea of growing it into a wholesale venture.

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Great Moments in Government Waste

Isn’t it nice to know that the federal government has about 100 separate programs to fund community activities that supposedly help fight crime? And isn’t it even nicer to know that there is no evidence that the money (which gets spent on things like pool parties and donut-eating contests) actually does any good? Senator Coburn has released a report about this wasteful spending and CBS News has a story about how the Department of Justice is squandering your tax dollars.

With a $13 trillion debt, why is the Department of Justice spending money on parties and rollercoaster rides rather than investigating crime, drug cartels, prosecuting terrorists? Untold millions of your tax dollars are paying for recreation in the name of crime prevention: pool parties, rollercoaster rides, and police donut-eating contests. The idea is that fun activities keep kids out of trouble, build self-esteem and prevent crime. …Now, the U.S. Government Accountability Office (GAO)has found nobody is measuring just how much is spent on the recreation – or whether it even works. Sen.Tom Coburn, R-Okla., estimates well over $100 million tax dollars over five years has been spent on recreation to fight crime. Coburn says poor tracking leads to questionable spending. At least $200,000 was spent for officials to attend conferences at golf resorts in Florida and Palm Springs, or a film festival featuring “Santa, The Fascist Years.” …Just last month, an Oklahoma City program was found to have misspent hundreds of thousands of dollars in federal crime prevention funds on things like a giant flat screen TV, 40 pairs of binoculars and $200 Japanese-style swords. Police said most of the binoculars were never used and there was “no legitimate purpose” for the swords. Twelve other federal agencies and 99 programs fund similar community programs.

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Great Moments in Government Waste, the European Version

It’s aggravating and maddening to send tax dollars to Washington and watch them get wasted on pork-barrel projects and inefficient programs. Imagine how much worse it would be, though, to send tax dollars to an international bureaucracy and be utterly helpless to stop the worst kinds of boondoggle spending. That’s how taxpayers from European nations must feel when they discover, as the Daily Mail reveals, that the European Commission bureaucrats squandered close to $20 million to conclude that fruit is a healthy food and to create a “Mr. Fruitness” superhero character.

EU bureaucrats have squandered millions of pounds on a study which reached the unsurprising conclusion that fruit is good for you. An astonishing 13.8million euros – some £11.7million – has been spent on research involving 200 scientists which found that ‘two apples a day keep cholesterol at bay’. Much of the money went on developing and promoting a green-skinned EU superhero called Mr Fruitness designed to persuade children to eat more fruit. …The multi-million pound project called IsaFruit lasted four years. …The website set up to publicise Mr Fruitness…describes him as ‘a superhero with special powers that come from the nutritional substances in fruit – vitamins and others; key components of an intelligent and conscious diet’.

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The Rent Seekers Strike Back

Apologies to Star Wars fans for the title, but it seemed very fitting considering the profound amoral mentality of the lobbyists who have launched a public relations campaign to defend earmarks. The key part of the story is excerpted below for your reading pleasure, but let’s focus on the “best” defense of earmarking. I’ve talked to some Republican politicians who argue the practice is legitimate because it means that elected officials rather than faceless bureaucrats are deciding how money is being allocated. That sounds semi-legitimate, but it overlooks three key problems.

1. Earmarking facilitates higher spending. The politicians on the Appropriations Committees allow other members to insert special requests (earmarks) – but only if they agree to vote for the underlying bill. This “log-rolling” practice makes it much more difficult for fiscally responsible members to convince their colleagues to support smaller budgets.

2. Earmarking is naked corruption. In the majority of cases, earmarks are inserted at the request of campaign contributors. In some cases, the contributors are lobbyists representing clients. In other cases, the contributors are the actual earmark beneficiaries. In either case, the process accurately could be described as bribery.

3. Earmarking supports programs and activities that should not exist. The “bridge to nowhere” became a symbol of the earmarking process, but the underlying problem is that members of the Alaska delegation focused on steering as many transportation dollars to their state as possible when they should have been fighting to get rid of the Department of Transportation.

Almost everybody in Washington loves earmarks. Politicians get to raise campaign cash. Lobbyists get rich charging clients. Special interests get money they haven’t earned. Congressional staff facilitate the process so they eventually can become rich lobbyists. The only losers are taxpayers and the Constitution. Anyhow, here’s the nauseating excerpt:

Lobbyists who pursue congressional earmarks are planning a public-relations campaign to defend the practice, as voters signal they no longer want lawmakers to direct millions of federal dollars to pet projects back home. The Ferguson Group, one of the largest earmark lobbying shops in Washington, is seeking donations from other appropriations lobbyists to establish a group that would promote the benefits of earmarks through a media campaign, according to documents obtained by The Hill. …“We have decided to form an informal coalition, tentatively called the Earmark Reform and Education Coalition, with the overall goal being to foster a rational conversation about earmarking among all interested parties, so that we can preserve what works and reform what does not.” …A third option is to partner with the American League of Lobbyists (ALL), according to Ferguson’s memo. Dave Wenhold, ALL’s president and a partner at Miller/Wenhold Capitol Strategies, said the organization has not decided on whether to join the campaign, but he defended earmarks as “the most transparent and accountable form of funding.”

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