Earmarks are the means by which lawmakers target government spending to a pet project rather than appropriating money for a purpose and empowering executive branch agencies to allocate the money according to guidelines.
Earmarks have plenty of defenders these days. Some folks believe that earmarking is always an appropriate exercise of legislative power and that the executive has too much discretion these days. Others argue that earmarks are the grease that makes the legislative machine work.
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Both of these arguments have merit, but at the same time, earmarks are a tool of corruption. They fuel corruption. They empower lawmakers to enrich themselves, their friends, and their donors, and the biggest beneficiaries are the insiders — lawmakers, staffers, and lobbyists.
Earmarks don’t even really help the communities they are supposed to help. For one thing, earmarks crowd out charitable spending. More broadly, the federal spending tends to crowd out private-sector spending, and thus actually harms the local economy: “Fiscal spending shocks appear to significantly dampen corporate sector investment and employment activity,” three scholars found in a 2010 study.
Former Republican Rep. Duke Cunningham used earmarks to get bribes from defense contractors.
Former Democratic Rep. Bill Delahunt earmarked money for the fishing industry and Indian tribes and then got hired as the lobbyist for both.
Out of Michigan comes another story of earmarks as a tool for enriching insiders.
Jason Wentworth, a Republican, was the speaker of the House in Michigan’s legislature before he became a lobbyist. While still in office, Wentworth earmarked $25 million for building a “wellness facility.” This money ended up flowing to a brand-new nonprofit group founded by Wentworth’s former chief of staff, David Coker, according to local media.
Immediately, that nonprofit group paid $822,000 to a for-profit consulting firm owned by Coker. Soon, the nonprofit group paid $3.5 million to buy land from a firm co-owned by Republican state legislator Tom Kunse, Wentworth’s successor.
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The state has suspended the grant because it looks like it may have been awarded without proper vetting.
Wentworth, Coker, or Kunse have not been accused of breaking any laws or ethics rules, but nevertheless, this looks like corruption — and it’s fueled by earmarks.