The Real Benefit of Being in Power

[Econ101]

In the Jan. 28th to Feb. 3rd issue of The Economist, there is an article on page 29, "Pork and Scandals, Hobbling the lobbyists". The article points out the problems that are apparent with our current system of government and the abuses of power that are commonplace in the nation's capital, but shows the problem is not with lobbyists, the problems are with those in power. Here is an exerpt:

Lobbying can't be banned-Americans have a constitutional right to "petitition the government for a redress of grievances." And they have an awful lot of grievances. For instance, Ted Townsend, a meat-packing tycoon, is aggrieved that his home state of Iowa has no indoor reinforest. He's been pitching the idea for several years: it would be "the coolest new attreaction on Earth", not to mention a "goose that will lay enormous golden eggs" for Iowa.

In 2003 Mr. Townsend gave $3,000 in campaign contributions to his Republican senator, Chuck Grassley. The next year Mr. Grassley secured $50m from the federal budget for Mr. Townsend's rainforest. There was absolutely nothing illegal about this. Mr. Grassley was entitled to accept Mr. Townsend's cash, and he no doubt sincerely believes that an indoor rainforest will benefit Iowa.

This story illustrates why influence peddling is such a problem. Individual lawmakers have immense power to take money out of the public purse for the narrowest of purposes. Any one of them can slip an extra paragraph into a bill to secure funding for a project that may have nothing to do with the bill's stated purpose. Such "earmarks" are often inserted at the last momoment and pass without scrutiny.

Projects funded this way are typically those that make sense on someone else's dime. (Iowans, weirdly, have been somewhat reluctant to chip in more than peanuts to their rainforest, promoting Senator Grassley to say he may cut back the federal contribution.) Earmarks are also an open invitation to corruption, since you only have to incentivise one congressman to win a fat slice of federal cash, and there are lots of legal ways to do it.

So long as the contribution conforms with campaign-finance laws and not legislative favour is explicitly traded, you are probably in the clear. And the congressman who takes your money willnot consider himself corrupt, becuase he is not trying to enrich himself. With a few exceptions, such as Duke Cunningham, congressmen solicit money to get re-elected, not to lunge on yachts. From an ordinary citizen's persepective, however, it is not clear how this is better.

Lobbyists are not the disease, merely the symptom. Their numbers (in Washington) have doubled in the past five years, to 35,000,because federal spending has grown larger and more wasteful. Earmarks have proliferated from 1,439 in 1995 to 13,997 last year. Politicians of both parties love them, because they allow an individual lawmaker to take credit for delivering a specific goody to his constituents.

The worst offenders are usually most senior members of Congress. Because they sit on powerful committees, they have more power to shower interest groups with taxpayer's money. Those interest groups reward them with campaign donations. After a while, incumbents become so good at raising money that they are impossible to dislodge. In his last race Senator Grassley spent 47 times mor than his challenger and beat him by 42 percentage points.........

Everyone should get a subscription to The Economist. It is easy to read and it is pretty non partisan. The article went on about some of the democrats doing the same type of things. We allowing these congressmen to spend our children's future taxes (the worst earmark) to remain in power. There is a negative return on investment on our nation's future. We need congressmen that will look for our nation's interests instead of their own. I know it is a lot to ask, but that is why they are sent to D.C. If a farmer/cattleman does not produce, he takes a financial hit. Why should it be any different for congressmen?

 

[DiamondSCattleCo]

I've often thought that campaigns should be strictly regulated, and a flat amount paid for from taxes. If someone wishes to contribute to a political campaign, it goes into a "lump sum" thats evenly divided among the recognized political parties.

There are probably more holes in that theory than could possibly be listed, but at least it would help remove some of the monetary power of certain lobbies.

Rod