The members call the semi-secret system "earmarks." Outsiders who understand the process call it "pork," and a blight on the USA.

$17 Billion for 11,000 Earmarks in Fiscal Year 2008 Alone
Earmarks (also referred to as pork projects) are tiny pieces of legislation buried out of sight in big pieces of legislation. When a big piece of legislation is passed, the little pieces go along for the ride with little review, debate, or notice, and taxpayers pay the bill. The little pieces can direct that federal funds be used for a specific project (see examples below), or the little pieces can direct that certain favored locations or companies or organizations get federal money from various government agencies beholding to Congress for support.

How Congress "Works." Two Examples.
#1. During the first week in October 2008, Congress debated the (first) historic, $700 billion financial rescue package. The world economy hung waiting for the result. The House of Representatives had already rejected the (Wall Street) bailout bill once. The Senate, hoping to get the House to relent, added $110 billion to the bill in "sweeteners," and sent the bill back to the House.


One of the sweeteners (an earmark) gave rum makers, Bacardi and Captain Morgan, nearly $192 million in taxpayer money for marketing subsidies and production incentives. But the House would not delay the $700 billion bailout for such a minor item; it is unlikely more than a few of the 435 members even knew of the run earmark (or several others) buried in the bailout bill by fellow members. So the $700 billion bill passed, closer to $800 billion in cost to taxpayers. That is how the system works.

Example #2. Early in the Iraq war, the Senate worked to pass a bill allocating $80 billion to pay for the war. The debate went on until late in the day, and the senators were tired. About 40 minutes before the bill was to be voted upon, members of the elite Appropriations Committee attached a set of miscellaneous (non-war) provisions to the bill. They said that the measures (sweeteners, once again) were needed to guarantee the approval for the bill. At the last minute, the war bill was passed by the Senate, including these special items sponsored by various senators:
— $10 million extra for a science research station at the South Pole. (Sponsored by Senator Bond of Missouri.)
— $5 million for a communications system for Louisville, KY. (Senator Bunning of Kentucky.)
— An amendment prohibiting DHL from carrying American military cargo because DHL was German-owned. Several senators sponsored this little extra after they were heavily lobbied by Federal Express and UPS.
— $3.3 million to repair a leaky dam in VT. (Senator Leahy of VT.)

This is the routine in Washington D.C. According to the watchdog group, Citizens Against Government Waste, earmarks have risen from fewer than 2,000 a year in the mid-1990s to over 11,000 projects costing $17.2 billion in fiscal year 2008. The group's definition: "A pork project is a line-item in an appropriations bill that designates tax dollars for a specific purpose in circumvention of established budgetary procedures."

Part II will cover four major reasons why many elected members of Congress regularly use earmarks to quietly channel taxpayer money in "interesting" ways. Part III will explore Business As Usual? After they are posted on Tahoetopia's front page, you can see all the stories by clicking on Other Stories.



Author's Notes: This is the first of three articles on a dominant practice of many members of the U.S. Congress. Parts II and III will follow in the weeks ahead, dramatic times in the USA. Not all members participate in earmarks; not all earmarks are "bad;" but the idea and process of quasi-secret earmarks is both contagious and poisonous to a society with a government historically based on transparency and accountability.

The term "pork" originated in the 1800s when a pork barrel often was used to store food, e.g., salted pork. The notion behind the term's derogatory use in politics, starting in the 1800s, was that office seekers sometimes provided voters with "food" of some kind in return for votes.

Editor's Note: Steve Brandt is Senior Lecturer in Management, Emeritus at the Stanford Graduate School of Business where he was a faculty member for 21 years.

For other articles in this series of three on the U.S. Congress, after they are posted, or for three recent, explanatory articles on the present Economic Quagmire, click on Tahoetopia's Other Stories.