The process of Congressional earmarking has received heavy news coverage in recent months, as U.S. citizens evaluate the effectiveness of government spending projects. Situations like the “Bridge to Nowhere” in Alaska and Senator Mitch McConnell’s personal charity appropriations have drawn attention to the lack of transparency and potential moral hazards that accompany the earmarking process. The following brief document provides an explanation and history of earmarking, along with a summary of the more significant criticisms of the practice.
Earmarking is the process by which members of Congress allocate budgeted money toward a specific program or project. They can be added to the Congressional Appropriations Budget or inserted into any bill as line items. Proponents of earmarks claim that they enable members of Congress to intelligently direct funds where they are most needed among their constituents, instead of deferring to the Executive Branch to allocate expenditures in potentially wasteful ways. The process of logrolling, or the inclusion of reciprocal earmarks, allows the sponsor of a bill to solicit support from other members of Congress; in effect “purchasing” a vote in exchange for an earmark.
While earmarking occurred as early as 1817, the practice was not widely seen until the 1980’s. The chart to the right shows that between 1996 and 2008, annual earmarks grew from 958 to 14,093. Incidentally, the total annual spending by lobbyists rose from $1.44 billion in 1998 to $3.30 billion in 2008.
Since the 110th Congress, the earmark process has been more tightly regulated: members must post their earmarks on a website and declare that they have no personal interest in the request. In addition, the OMB and private groups such as WashingtonWatch.com are expanding efforts to catalog and monitor earmarking behavior. The additional transparency and accountability from these efforts
While earmarks total only two percent of the Federal budget, critics argue that earmarks pose a significant moral hazard to the legislative process: lobbyists often give large donations to the campaign funds of members of Congress in order to secure earmarks. Since until recently, earmarks were usually inserted anonymously into legislation, they were also a convenient way to secretly award loyalty or punish enemies.
Since a member of Congress may insert a budget earmark for projects outside his/her geographical jurisdiction, lobbyists who are rejected by officials from one state are often able to secure funding from members in a different state. For example, Congressman Dan Young from Alaska earmarked $10 million to fund the construction of a highway interchange in Florida. Further research revealed that Congressman Young received a $40,000 campaign donation from the developer of the property. Behaviors such as this will hopefully be reduced by recent and future reforms.