But Sir, It's Wafer Thin!

by Eric Martin

I realize that others have pointed out that McCain's obsession with earmarks, and his quest to "make them famous," doesn't make sense when you consider earmark spending in proportion to the federal budget as a whole.  But after watching the debate on Friday, it has become increasingly clear that despite the dubious math, the main thrust of John McCain's economic policy seems to be that he will eliminate earmarks (other than ones that cover aid to Israel and other important programs) in order to "rein in spending" and fund his $300 billion tax cuts (aimed primarily at the wealthiest Americans). 

Thus, it bears repeating that McCain's claims about the money to be saved by cutting earmark spending are either gallingly ignorant or deeply dishonest. Put simply: earmark spending ($18 billion) is a sliver of a tiny piece of a fraction of the federal budget - and McCain doesn't even want to eliminate them all.  Taken at his word, his cuts to earmark spending would likely end up in the $10 billion range.

Blake Hounshell puts these numbers in context:

McCain seems not to understand that earmarks are just a tiny piece of the fiscal picture. As Barack Obama pointed out during the debate, earmarks represent just $18 billion out of a much larger pie. Compare that to the projected 2009 deficit (not counting the bailout) of roughly $500 billion. Or compare it to the total federal budget of about $3 trillion.

This pie chart provides a useful visual:

For a truer sense of the impact on the federal budget that McCain's bold new earmark cutting plan will have, you would have cut the red slice in the pie chart in half.  Barely a blip on the fiscal radar.

So which is it:  Is McCain simply clueless about budgetary matters? Or is he trying to deceive the public about the real impact of his fiscal policies - themselves a near carbon copy of Bush administration deficit-busting tax cuts for the wealthy while ignoring crucial priorities such as health care, repairing a crumbling infrastructure, funding the development of alternative energies and other global warming initiatives?

Comments

[KCinDC]

Don't earmarks just direct that money be spent on particular things? The earmarks don't actually allocate additional money, right?

It's true that if the earmarks for useless things didn't exist then perhaps the budget could be decreased by a corresponding amount, but that's a more complicated matter than simply removing the earmarks.

[brent]

Well the puzzling point is that, during the debates, McCain kept trying to make the point that, while earmarks are a small part of the picture, they were a "gateway drug." It might not have been a good strategic move for Obama to question him directly about what he meant by that but I was very curious to know the answer. Besides the fact that I don't really believe in the concept of a gateway drug, and I don't think politicians are addicted to earmarks so much as they just like bringing home money to their constituents, I really wanted to hear McCain explain the analogy. It might have been genuinely interesting.

[KCinDC]

Your headline undermines your argument, since the mint made a difference to Mr. Creosote despite its smallness.

[Incertus]

I think there's little question McCain is trying to be deceptive here. He's been in DC long enough to know that earmarks aren't the problem. I think he's counting on the fact that once you get above a certain level, the numbers are basically incomprehensible to most people--did you notice how, in the last two weeks, many people kept saying million instead of billion when it came to the bailout numbers? They just couldn't wrap their heads around the size of that number.

So when people hear "earmarks are 18 billion dollars, that number is too large to really process. When we think of really big numbers on a personal level, it's in terms of things like salaries for pro athletes or lottery jackpots, and those numbers don't come anywhere close to what we spend on earmarks. The numbers themselves cease to have meaning unless there's some context, and McCain deliberately leaves the context out because it's inconvenient.

[hermano]

dont you mean "rein in spendin'"?

[KCinDC]

Yes, Incertus, we probably ought to be using "thousand million", as the British used to do before they surrendered to the American meaning of "billion". Or talking about amounts per capita.

[Roger Moore]

So which is it: Is McCain simply clueless about budgetary matters? Or is he trying to deceive the public about the real impact of his fiscal policies

I think it's cluelessness. I think he really believed the line about earmarks being a gateway drug. He thinks that eliminating earmarks will somehow make Congress fiscally responsible to the point that it will cut other spending.

Of course that ignores the real world problem that cutting spending just won't do the trick. We would have to cut essentially all non-defense discretionary spending to bring the budget back into balance, which is so hopelessly impractical that it doesn't merit consideration. We simply have to raise revenues, cut defense and entitlement spending, or some mixture of the two if we want a balanced budget.

[Eric Martin]

Your headline undermines your argument, since the mint made a difference to Mr. Creosote despite its smallness

Damn you KCinDC!

So when people hear "earmarks are 18 billion dollars, that number is too large to really process.

Couldn't agree more. In fact, IIRC, McCain made a quip during the debate chiding Obama for sayin $18 billion wasn't significant when considering the big picture. Something like: "$18 billion might not be a lot to Senator Obama but..."

That's also why I wanted to post the pie chart. Too make the abstract a bit more tangible.

[David S]

KCinDC makes a good point. Even if earmarking was completely forbidden there is no guarantee there'd be a drop in the level of appropriations, nor that some of the same projects would not be (or even should not be) funded by the same federal agency when they allocated appropriated funds.

[rea]

dont you mean "rein in spendin'"?

You identify the typo at the heart of our present predicament--if only some well-meaning but illiterate fool had not told Ronald Reagan to "reign in spending," the fiscal history of the last 28 years would be rather different.

[Lewis Carroll]

Since McCain believes that earmarks are merely a *gateway* to bigger spending, maybe someone should ask him where in here he would make further cuts, keeping in mind that Social Security is self-funded (actually it's health is used to hide the degree of sickness in the General Account):

http://en.wikipedia.org/wiki/Image:Fy2007spendingbycategory.png

I see only one place where waste and swindle occur on a massive scale. I'm not going to specifically say what it is, but it starts with a 'd' and ends with an 'e'.

Also, what about the premise, narrowly construed to apply only presently, that we should be cutting spending when our economy is slowing down and may in fact already be in recession? I understand that in general the budget should be in balance, but during times like these, shouldn't we be trying to increase aggregate demand? Paging JM Keynes...

(Of course this is now problematic since the Republicans have dug us into such a fiscal hole already - heckuva job, Bushie!)

[KCinDC]

I amazed that there are 6,390 Google hits for the phrase "rein in hell", most of which seem not to be intentional. I'd've thought making the mistake in the other direction would be rarer than that.

[Eric Martin]

You identify the typo at the heart of our present predicament

For the record, I didn't commit a typo this time (this time). I actually got the rein/reign usage correct. I think the joke was "spendin" instead of "spending."

[Original Lee]

I think that numbers are not McCain's strong suit, and that his campaign is counting on the fact that many Americans are functionally innumerate - given two numbers in a sentence, many people have a great deal of difficulty with accurately assessing which number is larger, and by how much. You would think that people could hear 300 vs. 18 and get that 300 is much bigger than 18, but I think that once you get above a certain point, budget numbers register as random Very Big Numbers to many voters.

[Sebastian]

Hmmm. I'm economically literate, but I think earmarks tend to be bad. Bernstein says why better than I would, so I'll quote: link

Let's say Congressman X is an idealistic young Congressman. Some constituents in his rural district ask him to get federal funding for a new emergency room in a local hospital, because the nearest emergency room is 100 miles away. Congressman X is skeptical of earmarks, but this particular one both seems like a good idea and a way to help ensure his reelection--he won his first term with only 52% of the vote. He manages to slip the hospital funding into an appropriations bill.

Soon thereafter, Congressman X becomes aware of a new $5 billion initiative that is a complete and utter boondoggle, but will benefit the districts of several influential congressmen. He starts sending out press releases opposing the initiative, and threatens to a force a vote on an amendment removing the initiative from the bill to which it is attached.

The senior Congressmen who support the initiative schedule a meeting with Congressman X. Like mafia thugs, they tell the Congressman, "It would be a real shame if anything was to happen to your hospital funding--and any future funding for your district, for that matter." The message is clear; if Congressman X wants any hope of bringing federal money into his district, he had better stop opposing wasteful spending supported by his colleagues. He drops his opposition to the $5 billion project, gets the hospital funding, is reelected easily, and never again shows any "spending hawk" tendencies. Soon, in fact, he is rather senior himself, and finds himself meeting with a junior Congressman, telling him "It would be a real shame if anything was to happen to your hospital funding--and any future funding for your district, for that matter."

So, even though earmarks are a small percentage of the federal budget, they are a very important part of a broader system of corruption that leads to out-of-control federal spending.

[Hogan]

I see only one place where waste and swindle occur on a massive scale. I'm not going to specifically say what it is, but it starts with a 'd' and ends with an 'e'.

Sure, but there are plenty of people in the US who know, deep in their lizard brains, that there are hundreds of billions of dollars of WasteFraud'n'Abuse! in the federal budget, and we need to elect more Washington outsiders to root it out. (You know, people like John McCain.) "Earmarks" is just the latest verbal tickle for that stimulus/response. You don't need details; in fact, you're better off without them, since details merely highlight the fact that Republicans in Congress and the White House have spent the last twenty-eight years not finding more than a smidgen of this WasteFraud'n'Abuse!, and arguably adding even more.

[KCinDC]

Sebastian, I'm no expert either, but it seems to me that the same game can be (and is) played with expenditures (and tax breaks) that aren't earmarks, some of which are a lot bigger.

Everyone's opposed to wasteful spending, but not everyone agrees on what spending is wasteful. Using "earmarks" to mean "wasteful spending", which is what McCain seems to be trying to do (at least some of the time), doesn't help solve the problem. In fact it makes solving it more difficult by telling people that the solution is as simple as getting rid of earmarks.

[Sebastian]

Hogan: "but there are plenty of people in the US who know, deep in their lizard brains, that there are hundreds of billions of dollars of WasteFraud'n'Abuse! in the federal budget"

Or alternatively, the fact that you can't even tackle the corruption in the pretty much trivial percentage of the budget that is earmarks suggests that the corruption and waste is crazy deep.

Which, btw, is not the same as saying that McCain can fix it.

KCinDC: "Sebastian, I'm no expert either, but it seems to me that the same game can be (and is) played with expenditures (and tax breaks) that aren't earmarks, some of which are a lot bigger."

Sure. Congressman are almost as tricky with wasteful spending as Wall Street people were with their tricky derivatives. It isn't all in earmarks. But my point (I'm not trying to defend McCain's point which so far as I can tell on most topics is "I believe strongly in ummm something, right NOW, [subject to change without explanation]") is that if we can't even tackle it in spending with trivial amounts of money why should we believe it is being successfully tackled in all the other areas?

[Hogan]

Or alternatively, the fact that you can't even tackle the corruption in the pretty much trivial percentage of the budget that is earmarks suggests that the corruption and waste is crazy deep.

I'm certainly open to that theory. But I hear it asserted a lot more often than I hear meaningful evidence in support of it. My experience with government offices suggests "false economies" a lot more loudly than "rampant unnecessary spending." But maybe the elephant isn't exactly like a snake, and I'm hanging out in the wrong government offices.

[Eric Martin]

Congressman are almost as tricky with wasteful spending as Wall Street people were with their tricky derivatives. It isn't all in earmarks. But my point (I'm not trying to defend McCain's point which so far as I can tell on most topics is "I believe strongly in ummm something, right NOW, [subject to change without explanation]") is that if we can't even tackle it in spending with trivial amounts of money why should we believe it is being successfully tackled in all the other areas?

Part of the problem with the Volokh post is what KCinDC explains: the same influence/log rolling would occur absent earmarks. A legislative bloc looking for a non-earmarked project would make deals/cajole other legislators in a quid pro quo tradeoff in the same way described by Bernstein. The fact that we focus on the earmark side of the equation is a red herring.

Further to this, discretionary spending itself is pretty small compared to the overall budget. If you take out the entitlements and defense spending (including veterans payments), there's just not that much money to be trimmed as budget hawks would have us believe.

Especially when you start ticking off the other "discretionary" areas that include educational expenditures, foreign aid, counterterrorism, etc.

[Gary Farber]

"So, even though earmarks are a small percentage of the federal budget, they are a very important part of a broader system of corruption that leads to out-of-control federal spending."

This might make sense in a universe where horse-trading of favors between Congressional representatives, and being whipped by the leadership, can be eliminated -- whatever the means -- but how you propose to get to that land of honey and fairies and ponies, I'm curious to know.

And if you can't, what do you think you'd accomplish be eliminating earmarks?

And can you explain to me, Sebastian, why it is you favor, if you favor eliminating congressional earmarks, making the federal executive bureaucracy, some obscure bureaucrats working in hidey-holes in various executive departments, the sole allocators and determiners of where federal projects go, and what money is spent on, rather than locally elected Representatives of the people?

What kind of Republican principle is, that, exactly, that favors executive bureaucrats, over local control and elected Representatives?

I've never understood how Republicans could get with this whole "take away control from those closer to home, and give it to faceless unelected people in Washington" plan about earmarks: what's up with that?

[Turbulence]

Eric, I don't think Seb was suggesting that McCain's belief that lots of economic problems could be solved by eliminating earmarks is sound. It sounded like he was claiming that earmarks might have a larger budgetary influence than their share of the budget indicates. Seb's been pretty consistent in his dislike for McCain.

[jean]

OK, Is an earmark MORE money than allocated, or a politician corraling part of an already agreed upon amount of money to the benefit of his/her particular constituents? (I now realize KCinDC asked the exact same question!)I looked at several definitions and it seemed like a lot of technical political doubletalk. I also thought they were anonymous and put in after the discussion of the bill or whatever, so the congresspeople wouldn't necessarily know they were even there. So, KCinDC, there seems to be little consensus on what they even ARE.
And in other opinions:
I think defense spending should be cut, but that could be dangerous to a president's health and well being (tinfoil hat ON). After all, what's the good of all those toys if you're not going to use them? I'm for butter, not guns.

[Eric Martin]

Turbulence,

I don't disagree and mean to suggest that Sebastian feels otherwise. It's one of the areas we agree on, and I applaud his instincts.

My point was just that: (1) earmarks aren't the source of the larger corruption portrayed; and (2) the supposed "larger budgetary influence" itself is overstated.

The larger corruption (log rolling on non-earmark spending projects) would exist absent earmarks. There's nothing special about earmarks that makes them conducive to log rolling (at least when you look at Bernstein's hypo), whereas other non-earmarked spending wouldn't be.

Further, even assuming (ex arguendo) that one could rein in the discretionary spending corruption by cutting earmarks, there just isn't that much discretionary spending. Period. Most of our budget is eaten up by entitlements and defense spending and necessary expenditures (cost of running government). Even a lot of the so-called discretionary stuff is quite vital and few would actually suggest eliminating.

That being said, I'm all for trying to limit corruption and wasteful spending. But focusing on earmarks doesn't strike me as a very effective way of getting at the larger corruption.

Basically, what KCinDC said:

Everyone's opposed to wasteful spending, but not everyone agrees on what spending is wasteful. Using "earmarks" to mean "wasteful spending", which is what McCain seems to be trying to do (at least some of the time), doesn't help solve the problem. In fact it makes solving it more difficult by telling people that the solution is as simple as getting rid of earmarks.

[Nell]

I like Jim Henley's suggestion to make the scale of earmarks more understandable to voters:

why not literalize the metaphor? Make an actual mark on your ear with a pen (water-soluble!) and say, “This little slash, compared to my whole body, is the proportion of earmarks to the budget.”

[Quecus]

If the pie chart is too abstract, here’s another way to put it:

Right now, the federal government is like a guy that’s earning $50,000 a year, but spending so much that he’s putting $10,000 a year on his credit cards. McCain says that the solution is for this guy to give up $1 of coffee per day.

[Alex Schaffer]

Jean - The OMB website has a decent description of earmarks:
http://earmarks.omb.gov/earmarks_definition.html

According to them, an earmark can either be funding mandated by congress beyond what was requested by the executive branch, or a directive to use funds from the total amount (but not beyond that amount) requested by the executive branch for the project(s) indicated in the earmark.

Gary Farber - It's usually better to have "obscure bureaucrats in their hidey-holes" determine which projects get funded because they are bound by regulations that (in theory, at any rate) rank projects according to their necessity and value. Congressmen requesting earmarks have no such restrictions and can try to fund projects that would rank very low in necessity compared to other projects throughout the country. Depending on which type of earmark it is, more deserving projects can then be underfunded in favor of a powerful congressman's pet project, or the total amount of the allocation goes up.

With money for most projects so tight, earmarks can do a lot of good since these projects might not otherwise get funded, but it would be nice for there to be a more rational basis for assigning funds than a congressman hollering "I want it! I want it!"

[Martin]

Break the question of earmarks, specifically between Obama and McCain down a little further.

Illinois is a donor state. In 2005, Illinois businesses and individuals payed $100B in federal taxes and received $81B in services. Since we still ran a deficit that year, they should have received more in services than they paid.

Arizona is a beneficiary state. In 2005, Arizona business and individuals received $9B more in services than they paid.

In Obama's entire time in the Senate, he returned home about 5% of what someone from Illinois could claim they overpaid to the federal government in one year. These men represent the interests of their states, as they were elected to do. Which man is doing the better job of getting value for the tax dollar? Obama who brought $.80 on the dollar home, or McCain who brought $1.14 home? McCain may have not used earmarks, but he certainly used something.

[Samuel Hellman]

If you are going to show that graph you might as well look at this one too:
http://andrewsullivan.theatlantic.com/.shared/image.html?/photos/uncategorized/2008/06/12/funnygraphsstructureofa.jpg

[Gary Farber]

"Gary Farber - It's usually better to have 'obscure bureaucrats in their hidey-holes' determine which projects get funded because they are bound by regulations that (in theory, at any rate) rank projects according to their necessity and value."

Be that as it may, I was asking Sebastian, specifically, for his view, and the conservative/Republican view on the question. Thanks for your perspective, to be sure, but I'm well aware of plenty of answers to the question of how earmarks might best be dealt with, and why; I'm not aware of how Sebastian or most conservatives and Republicans reconcile these views, which is what I'm asking about.

[theo]

It's pretty clear McCain is trying to deceive by implying that all large numbers are approximately equal. Notwithstanding the special pleading of certain conservatives here, it would take a hell of a lot of "dynamic scoring" to make earmarks plus their moral consequences nontrivial in the federal budget.

Earmarks are a fine issue for a crusade by 1 of 535 congressmen. The President has bigger fish to fry, which is why I don't think McCain is even taking the earmark issue seriously for a second.

Following up on Henley's pen mark idea, I don't understand why a skilled communicator like Obama won't explain earmarks on a per capita (or "Per American") basis.

Earmarks = $65 per American. Defense budget = $2000 per American. If even tax protestors can do the math, it should be understandable by anyone.

[rate my body]

mccain is not good for this country. he does not do the right things.