When Treasury Secretary Henry Paulson first announced his $700 billion Wall Street rescue plan, Sen. Chuck Schumer (D-NY) promised: “We will not Christmas-tree this bill. The times are too urgent. Everyone has their own desires and needs. It’s going to have to wait.” So how did Congress live up to Schumer’s promise? When the bill finally passed, in addition to the $700 billion given to Paulson, another $150 billion in goodies was also given to special interests, including tax breaks for makers of wooden toy bow-and-arrow sets. The same kind of toys one might find under a Christmas tree.
Unfortunately, this behavior has become the status quo in Congress. No emergency legislation can pass without attracting billions in unrelated spending. Perhaps the worst example of this phenomenon is the supplemental appropriations for the wars in Iraq and Afghanistan. In the early stages of the conflict, Congress managed to keep unrelated spending items out of emergency spending legislation. But as the scope and cost of these operations has become more predictable, Congress has chosen to add more wasteful spending to each bill. In 2006, Congress tried to add $14 billion in unrelated domestic spending (including a Mississippi “railroad to nowhere”) to the war funding. In 2007, Congress successfully added $21 billion in domestic spending (including another farmer bailout, despite record farm incomes). And in 2008, the Iraq and Afghanistan supplemental spending measure included an astounding $71 billion in new domestic spending. As you can see, the problem is only getting worse.
Each year Congress passes a budget resolution capping total discretionary spending at a specific level for the following year. But emergency supplemental spending exists outside the normal appropriations process and is not subject to these caps. So if a congressman can’t get his favorite project funded through the normal budget process, he just waits for the yearly war funding bill to come along, and tacks his spending priorities on that bill. This gateway to uncapped domestic spending can exist only if Congress can count on an “emergency” funding bill every year.
Given the length of time the military has been engaged and the increased predictability of what is required to succeed, the Pentagon should no longer use supplementals to pay for the war. The costs of the respective American operations now average about $10 billion per month. Congress should instead begin funding these operations as part of the regular defense budget beginning in fiscal 2010. Funding for the operations in Afghanistan and Iraq are becoming increasingly about “resetting” the military, making them more difficult to distinguish from the core defense program. Therefore, the costs of the supplemental appropriations ought to be incorporated into the funding requirements of the core defense budget. Even beyond the non-emergency domestic spending add-ons by Congress, Iraq and Afghanistan should have to compete with other federal programs within the normal budget process. No single spending item exists in a vacuum, so Congress must have an opportunity to set priorities and make trade-offs across the entire federal budget.
It is shameful the way our leaders in Washington feel compelled to load up emergency spending measures with their own narrow priorities. According to Rasmussen Reports, 59% of voters would like to throw all of Congress out and start over again. We understand America’s frustration. Hopefully removing an annual temptation for budgeting chicanery will help restore some honesty and responsibility to Capitol Hill.
- Stock markets in Russia, Brazil, Indonesia and the Middle East all fell yesterday.
- The Treasury Department has begun to set a timetable for picking Wall Street fund managers to run the financial rescue program.
- According to Rasmussen Reports, 63% of U.S. voters say Wall Street will benefit more than the average taxpayer from the $700 billion bailout.
- A survey by the Kauffman Foundation found the top threat to “your own economic situation” was higher taxes.
- The Georgia Supreme Court ruled Monday that a transgender politician did not mislead voters by running for office as a woman.