Monday, January 23, 2006

Let's Really Limit Federal Corruption

With all of the howling about congressional earmarking (see my previous post) and related corruption, I wonder how many of the howlers and their adherents realize that some of the biggest beneficiaries of earmarks are state and local governments. I wonder how many realize that these government entities are exempt from many of the lobbying rules intended to curb corruption.

John Fund has an article in today’s WSJ that explores this particular issue. Even our lovely Beehive State merited dishonorable mention. “The Utah Transit Authority, which provides public transportation in the 41st most densely populated state, spent $1.6 million on federal lobbyists in 2003.” You can argue that Fund’s blithe statement ignores the realities of population density along the Wasatch Front, but that sidesteps the issue.

As I noted previously, lobbying firms now actively solicit government entities, virtually guaranteeing them an earmark or two. Citing a particular instance in Northern Virginia, Fund notes that lobbyists were essentially selling federal money for 2.6 cents on the dollar. That’s a pretty good investment from the perspective of state and local governments, but it’s not good for the country.

How did we traverse from 1817 – when James Madison vetoed federal spending for local roads, bridges and canals because such was not specifically enumerated in the Constitution – to 189 years later where vast amounts of the federal budget are devoted to such local projects? Fund says that while we did not amend the Constitution to permit this practice, we have “so undermined our founding document by degrees that we now find ourselves mired in earmarks and in peril of squandering our birthright for a mess of pottage and pork.”

We have moved from the paradigm of a strong central government to the paradigm of an ultra-strong central government that is ├╝ber Alles. Most government spending is now controlled more or less by Washington D.C. The feds control the purse strings and dish out unfunded and strings-attached mandates to states. State and local governments often feel that they have no alternative other than to engage in high stakes panhandling inside the beltway. Congressional representatives and senators feel like their performance is judged by how much federal money they send back home. The more money government controls, the more business springs up to get a piece of the action. It’s simple market economics. Corruption inevitably ensues.

There are lots of reform efforts underway because this has now got the public’s attention. Utah Rep. Steve Urquhart (R-St. George) argues here that state legislation to prevent local governments from lobbying Congress is a good step. Fund says that all of the current reform efforts will only treat the symptoms. The real problem is that we have long given up on limited government. While it is often necessary to treat symptoms of a disease, it is never good to do so while ignoring the root of the disease. We need to treat the disease itself. That means a meaningful return to limited government. How can this be done? Does the intestinal fortitude exist to do it?

I have previously referred to LaVarr Webb’s excellent essay about returning to limited government. He says that leaders do a poor job because government has gotten too big for them to do a good job. Webb uses computing as a model for government, arguing for a departure from the old mainframe environment to step into the modern times of networked computing. He suggests that government can work similarly, with duties being handled at the most appropriate level of government and inter-government relationships being handled via established interfaces.

Webb admits that his vision would be nearly impossible to implement, but he also says, “We won’t have successful leaders at the federal level until the federal government is downsized and right-sized.” I agree. We won't limit federal corruption in a meaningful way until then either. This process will be painful, so let’s get going and get it over with before the disease gets any worse.

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