Advertisement

A Slice of Pork Can Dice a Budget

Share
<i> Alan B. Ungar is co-chair of the Federal Issues Committee for the Valley Industry and Commerce Assn. and a certified financial planner</i>

After years of partisan bickering, posturing and mudslinging, Congress and the administration have finally agreed on a balanced budget. It was a difficult and hard-fought battle, the good fight, one that was worth it.

Today’s business climate validates it. Never have things been so good. Interest rates are low, inflation is under control, productivity is up and personal income is on the rise.

So why would our local congressmen unanimously vote for a bill designed to unravel it?

They agreed to spend $33 billion more on transportation than last year’s budget agreement called for. This is no big deal if they adhere to the agreement that specifies that any increase in spending has to be offset with spending cuts or tax increases. But that poses a problem because our congressmen would have to make some hard choices: The cuts would have to come from programs such as education, environmental protection, law enforcement, veterans benefits and other discretionary expenses.

Advertisement

But our congressmen along with a majority of the House of Representatives figured out a way to get their pork and eat it too. They agreed to a plan that would separate the highway trust fund--financed by gasoline taxes--from the general federal budget. Taking it off budget would require Congress to find new ways to keep the budget in balance.

In 1957, when gas taxes were created, the American public was told that those taxes would be spent solely on transportation infrastructure. The reality is that 4.3 cents of every gallon of gas is earmarked for deficit reduction and flows through the highway trust fund. The money has never been spent for transportation, but if the fund is taken off budget it would be.

In addition, there are 167 trust funds within the federal budget. If one comes off, why not the others? Taking any trust off budget can have a domino effect, since every special interest would want to avoid the constraints of the balanced budget agreement. It is irresponsible for Congress to try this sort of end run.

So why did our local congressmen participate in this?

One part of the answer is simple: They brought home the pork. Rep. Brad Sherman (D-Sherman Oaks) was able to get $5.5 million for the Santa Monica Mountains; Rep. Buck McKeon (R-Santa Clarita) got $13.9 million for an I-5 overpass in Santa Clarita. The all brought home goodies for their constituents.

McKeon has said that he supports removing the trust funds from the budget because he believes it is the transportation trusts that have been ripped off over time. Perhaps he is not aware that from 1980 to 1997, the transportation trusts spent $13 billion more than they took in. That negative cash flow was covered from the general budget and added to the deficit.

Last year, Sherman was claiming that he was a fiscal conservative and absolutely behind balancing the budget. This year, he supports the transportation trust bill because “we can afford it.”

Advertisement

Sherman is a certified public accountant. He must know we don’t have a surplus. He knows we had to borrow $101 billion from Social Security last year. That means there is a deficit, not a surplus.

Evidently, all but 80 members of the House share Sherman’s sentiments. Last year, most of them voted no on a transportation bill that was a budget breaker but did not take the trusts off budget.

To get extra money would have required the same hard choices so cleverly avoided this year.

Additionally, last year the American public was focused on having a balanced budget. If our congressmen had voted yes on last year’s bill, it would have left them vulnerable at election time. This year, their political antennae tell them the American public is no longer focused on fiscal responsibility.

Our representatives manifest a system that rewards them for responding, not leading. This means it is up to us to tell them we do not appreciate the kind of legislative irresponsibility they exhibited when they voted to take the transportation trust off budget.

We expect them to be fiscally responsible. We expect them not to go along with end runs like the transportation bill.

Advertisement

We need to let them know we will reelect them when they make the hard choices.

Advertisement