As President Bush calls on the Senate to pass its version of line-item veto legislation as a means of controlling government spending, it’s important to keep in mind just how much pork barrel spending is in relation to other important budget data points.

According to Citizens Against Government Waste, the government spent $23.7 billion on "pork-barrel" spending. No small sum, for sure.

But, $23.7 billion is but a fraction (7.5%) of the $317 billion FY2005 federal budget deficit.

At less than one percent (0.96%) of the $2.5 trillion the government spent in 2005, it’s barely recognizable.

If we look at just discretionary spending - spending that is authorized each year by congress through the budget process - we see that earmark spending (i.e. "pork") composed only 2.45% of $968 billion in spending authorized by congress in FY2005.

So, for all the jumping up-and-down and speechifying about how important the line-item veto will be in restraining spending, it’s quite clear that the president and congress are not serious about getting control of the budget deficit.

Let me also call your attention to a handy set of data produced by the CBO - a PDF of Historic Budget Data. It's a set of tables neatly summarizing the revenues and outlays of the federal government 1962-2005.

Former Chair of Council of Economic Advisors for George W. Bush Greg Mankiw writes about the line-item veto. In wondering about what economists think of the line-item veto, he quotes two papers published in the August, 1998 Journal of Public Economics:

The paper examines the claim that gubernatorial line item veto power reduces state spending. Analysis of a rich set of state budget data indicates that long run budgets are not altered by an item veto....These results suggest that state budgets have not been importantly altered as a result of the existence of the line item veto and shed doubt on the use of the line item veto to reduce federal government spending.

and

...Using data from 1865 to 1994, I show that these measures are most likely proposed by fiscal conservatives who fear the loss of power in the future; in order to protect their interests for those periods when they will be in the minority, they implement institutions such as the item veto which will limit future, liberal legislatures.

The bottom line: The line-item veto is a tactic of conservatives running scared in a vain attempt to control the growth of government.

Although the Senate defeated two minimum wage increase proposals last week, Democrats in the House are working to bring their minimum wage hike to a floor vote. Their resolve is grounded in a simple principal neatly summarized by House Minority Whip Steny Hoyer (D-MD):

"We want people to work hard and play by the rules. And when they do, they should not be relegated to poverty."

On June 13, Rep. Hoyer and Rep. David Obey (D-WI) added a minimum wage increase amendment to Labor, HHS, and Education appropriations bill. Much to the chagrin of the Republican House leadership, the House Appropriations Committee adopted the amendment 32-27. As a reward for their good deed (or out of fear of possible passage), House Majority Leader John Boehner (R-OH) has blocked the committee’s Labor, HHS, and Education appropriations bill from a floor vote.

The House approved (247-172) Rep. Paul Ryan’s (R-WI) Line Item Veto bill. The bill, also referred to as "line-item rescission", would give the president the power to force Congress to vote on specific line items on bills sent to him by Congress. President Clinton signed (and used) a more potent version of line-item veto, but it was declared unconstitutional by the Supreme Court.

House Republicans claim that this bill will help narrow the budget deficit by reining in some of the pork barrel spending which has exploded since Republicans have taken over the Executive and Legislative branches. But, the fact is giving the president this power will probably do little to stem the tide of red ink. In fact, this bill may actually increase the deficit.

It’s all about blame-shifting. If Congress shifts responsibility to the president to control spending, what incentive does it have to do so when it creates spending legislations?

Yesterday the House, under suspension of the rules, passed H.R 5060 - a one-sided bill sponsored by Reps. Roy Blunt (R-MO) and Tom Davis (R-VA) that would require all domestic grants made by the federal government to be posted to a new free, searchable public website. Despite intense efforts, OMB Watch and other partners were unable to get the bill sponsors to add language requiring federal contracts data to be including in a simliar fashion - as a much better and more genuine Senate bill would require. OMB Watch is strongly supportive of the Senate bill.

Even at this point, it's unclear why Mr. Blunt and Mr. Davis believe disclosure of federal spending on grants requires transparency to the public, but federal spending on contracts does not? What exactly are they afraid will be reveiled? What are they hiding?

Disclosure, transparency, and access to government information are themes of good government properly ordered regardless of political ideology or party affiliation. Sens. Coburn and McCain - the Republican sponsors of the Senate bill realize this, as do the 43 conservative organizations who pledged their support to the Coburn effort. Federal contracts need to be disclosed to the public.

In all the talk about the deficit and Social Security one rarely hears of the heroic role that Social Security plays in masking a $170 billion in budget shortfalls.

During the opening remarks of yesterday’s markup of Sen. Gregg's (R-NH) Stop Over-Spending gambit bill, committee Republicans continually advanced the idea that not only could we not tax our way out this problem, but that curtailing entitlement spending was the only way to close the gaping hole in the budget. Gregg’s package has several proposals aimed at reducing Social Security, Medicare, and Medicaid spending. Republicans droned on and on about how much of a threat Social Security (and Medicare and Medicaid) is to the budget.

Interesting. Republicans have the situation completely backward. Social Security is just fine, thank you very much. It’s working exactly the way it was designed to work. The General fund’s (the government’s operating budget) massive deficits are the problem. Each year, Social Security loans billions of dollars to federal government. In 2005, the Social Security trust fund took in $171.8 billion more than it paid out in benefits. The trust fund loaned, through purchasing government bonds, that $171.8 to the federal government’s General fund. So, FY2005’s reported $319 billion deficit would have been $490.8 billion without Social Security performing its civic duty of buying government bonds.

We previously blogged on an effort by Sens. Coburn and Obama (and Carper and McCain) to establish a comprehesive website the public could search for information on federal financial assistance, including federal contracts and grants, by Jan. 1, 2007.

OMB Watch has circulated an endorsement letter for the legislation that currently has 32 organizations signed on. The National Taxpayers Union circulated their own endorsement letter, attracting additional support from conservative circles.

We hope the bill will be marked up in the Homeland Security and Government Affair Committee sometime in July.

UPDATE: The National Taxpayers Union has an updated version of its letter posted this afternoon with over 40 groups! Kudos to NTU and their partners!

Does welfare reform work? Do food stamps really feed the needy? Are government assistance programs really helping those in need? How effective is our social safety net?

Congress certainly doesn’t want to know. Right now, the House Appropriations Committee is considering a Bush recommendation to terminate a program designed to answer these questions.

In 1984 the Census Bureau initiated the Survey of Income and Program Participation, or SIPP. SIPP’s purpose is to “collect source and amount of income, labor force information, program participation and eligibility data, and general demographic characteristics to measure the effectiveness of existing federal, state, and local programs.” It is an invaluable tool used to determine how well (or how poorly) government assistance programs deliver on their promises.

Good governance requires good information, and since Congress isn’t interested in the former, one can conclude it’s not interested in the latter. Researchers seeking to understand low-income families and the programs designed to help them have very few places to turn when they look for data, and SIPP is unique in its depth, scope, and quality of data. In other words, it is THE place researchers (inside and outside the government) go to when they look for basic (and more complex) information about government assistance programs.

At $32 million per year, SIPP is a veritable bargain because of the quality and amount of information it supplies to policymakers. The existing FY2007 Science-State-Justice-Commerce Appropriations bill calls for just enough funds to wrap-up data collection for this year, effectively ending the program. However, Rep. José Serrano (D-NY) is proposing to add $10 million to keep the program in existence. It isn’t full funding, but it’s enough to ensure that the program continues.

UPDATE: Rep. Serrano was successful!

Tomorrow the Senate Budget Committee will be marking up the Legislative Line Item Veto Act. On June 15, the House Rules Committee approved legislation (H.R. 4890) that would give line-item veto power to President Bush, in an 8-4 party-line vote.

The Congressional Budget Office has estimated in this report that the line-item veto legislation's impact on the budget would depend on the "extent of the President's use of the new cancellation procedure and on future Congressional actions," but concludes it would not have huge fiscal implications. What the proposal would do is give the executive branch the power to force Congress to consider the president's spending priorities under fast-track procedures and allow the president to influence congressional compromise negotiations almost at any point.

This morning, the Senate voted on and approved $94.5 billion in emergency spending for FY2006 to pay for wars in Afghanistan and Iraq and Hurricane Katrina Relief.

The hotly contested bill, held up by, among other things, the president’s last-minute border-security funding request, was finally approved by the Senate after it caved in to demands from Bush that the bill not exceed $95 billion. On Tuesday, the House approved the conference report, and the bill is now ready for the president’s signature.

Included in the measure: $70.4 billion for military spending; $19.8 billion for Katrina recovery efforts; $2.3 billion for flu pandemic planning; and $1.9 billion for the president’s border security initiative. Also in the bill is a provision which sets a Senate discretionary spending cap for FY2007 at $873 billion.

Picture this, if you will: A hurricane levels your house and you have to move into an apartment while your home is repaired. You are also a reasonable, sane, and mathematically competent homeowner who can budget living expenses appropriately. When you created your budget that year that the hurricane destroyed your home, you (rightfully) did not include in your budget a line-item for mortgage payments and rent. Let’s also imagine that you’ve had problems getting your home repaired due to unexpected problems with your contractor, various building codes, material shortages, etc. In fact, you see no end to these problems and have no plan whatsoever to move out of your apartment.

Would you, after five years of paying rent, fail to include rent expenses as a line item in your Quicken budget? Exactly. No reasonable head-of-household would. My home-ec teacher would’ve flunked me if I didn’t answer ‘No’ to this test question.

Congress, however, is just now coming around to the realization that Iraq and Afghanistan war spending should maybe be included in annual appropriations. The Senate voted yesterday (98-0) to approve Sen. John McCain’s (R-AZ) amendment to the FY07 defense authorization bill that would allow emergency spending only in the case of unforeseen expenses. And given that President Bush has continuously rejected setting an "arbitrary timetable" for withdrawal from Iraq, one can hardly claim Iraq war expenses as "unforeseen."

After reporting yesterday that the House and Senate had yet to reach a compromise on the supplemental spending bill, they did in fact reach one last night. The $94.5 billion bill to fund the military and hurricane relief also sets the budget spending cap for the Senate at $873 billion (the Senate, remember, had orignally passed a budget resolution allocating $16 billion more in funding, mostly for human needs programs). A number of Senators wanted to boost the cap to $880 billion, but were unable to do so because of resistance from the White House and the House leadership.

The majority was able to get over the budget jam by gaining the support of a couple of Democrats, specifically Mary Landrieu (D-LA) and Daniel Inouye (D-HI). Inouye said in a statement that "I signed also because I was given assurances from [Appropriations Committee] Chairman Cochran that every effort would be made that $7 billion in advance funding would go to the Departments of Labor, and Health, and Human Services."

Now that the Senate knows the amount of money they have to work with -- even though it insufficiently funds human needs programs -- they can begin the process of setting 302(b) allocations.

The FY 2006 emergency supplemental bill to fund war efforts in Iraq and Afghanistan was held up this afternoon because of a dispute over where the Senate should set the discretionary spending limits for FY 2007 appropriations bills. According to CQ Today, a spokeswoman for Senate Appropriations Committee Chairman Thad Cochran (R-MS) "confirmed that a resolution 'deeming' a Senate fiscal 2007 spending cap had not been resolved. She said it would be difficult to reach agreement on a final bill without a deeming resolution attached to it."

This means that Congress will likely be waiting until next week to pass their supplemental (HR 4939). Because the two chambers of Congress failed to reach agreement on a budget resolution (which includes a cap on discretionary spending), Senate appropriators want to use the supplemental to "deem" a limit for their spending bills. Without a cap they would be unable to assign specific funding allocations for each spending bill.

The Congressional Budget Office has released their Monthly Budget Review. During the first eight months of FY 2006 (remember the fiscal year begins October 1) the government incurred a deficit of $223 billion, which is $50 billion lower than the deficit amount recorded for this period last year.

Outlays for Social Security and net interest payments on the debt grew by about $3 billion each, and defense spending was up $2 billion. Receipts for the month of May this year were substantially higher than receipts last year. The report says:

Nonwithheld receipts of individual income and payroll (social insurance) taxes were up by about $15 billion (or more than 70 percent). That substantial increase occurred in part because a larger share of receipts from tax returns filed in April was recorded in early May this year than in May of last year. (For the two months combined, nonwithheld receipts were up by about 20 percent this year.) Receipts of individual income and payroll taxes withheld from paychecks were about $18 billion higher (a gain of almost 16 percent). Those receipts were boosted by an additional business day this May.