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Congressional Ethics

February 10, 2013, 9:23 pm

I am sick and tired of politicians impugning the ethics of private individuals engaged in commerce.   There are certainly a small minority of fraudsters in the world of business, but there is a supermajority of unethical people in Congress, arguably approaching 100%.

My latest evidence for such is this article in the Washington Post about the ethical bankruptcy of the Federal budgeting process.  It is impossible to excerpt, but here is a representative example:

At the Census Bureau, officials got credit for a whopping $6 billion cut, simply for obeying the calendar. They promised not to hold the expensive 2010 census again in 2011.

By law, the next census is not until 2020.  There was never, ever going to be a census in 2011.  But Congress claimed $6 billion in savings for not having one none-the-less.  Here is more:

In the real world, in fact, many of their “cuts” cut nothing at all. The Transportation Department got credit for “cutting” a $280 million tunnel that had been canceled six months earlier. It also “cut” a $375,000 road project that had been created by a legislative typo, on a road that did not exist....

Today, an examination of 12 of the largest cuts shows that, thanks in part to these gimmicks, federal agencies absorbed $23 billion in reductions without losing a single employee.

You can impugn business ethics all you want, and I can add a few stories to yours, but I have worked at fairly senior positions in two Fortune 50 companies and as a worker bee in a third, and in all three it would be a firing offense to engage in this kind of Charlatanism.

More in my Forbes article from 2 years ago.

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Category: Government
  • Incunabulum

    have you ever seen the series "Yes, Minister"? Its a britcom about an MP dealing with the machinations of the british civili service. There's at least one episode dealing with budgeting where the senior civil servant is hiding the fact the the civil service is *not* making required budget cuts by doing exactly this sort of subterfuge. Reclassifying clerical staff as contractors rather than staff, counting savings from already cancelled projects.

  • Gary

    Perhaps you can explain something to me.

    As I understand it, congress, led by Obama and the Democrats, voted for a ONE-TIME "stimulus package" in 2009 that eventually cost about $830 billion. Since then, most of that amount (about $700 - $750 billion) has simply been added to the federal budget baseline! This is why Harry Reid has not allowed an actual budget to be passed: using a series of "continuing resolutions", he has put federal spending on autopilot, maintaining the heightened 2009 level. This extra spending is over 20% of the federal budget and explains why the Obama deficits were/are so gigantic.

    First of all, do you agree with this characterization of what happened--and if not, what about it is incorrect?

    If it is generally correct, how do you account for the deafening silence about this Great Budget Robbery? I can understand why Obama, most Democrats and other big-government types would want to keep quiet about it. But what about the Republicans in congress and the many conservative and libertarian commentators, blogs and other outlets? Why didn't they scream bloody murder (eg "Hey! That was a ONE-TIME, emergency waste-of-money, not something we repeat EVERY YEAR! Remove it from the budget now!")? Why aren't they screaming bloody murder now?

    I feel like I've been transported to Bizarro World. Since 2009, the feds steal over $700 billion annually and no one seems to notice. What the hell is going on?

  • LarryGross

    where do you folks get this stuff? You cannot have a stimulus and no you cannot add it to the baseline budget unless a majority of Congress GOP and DEM - not Mr. Reid by himself, approves it and they have not. Harry Reid does not "pass' CRs, Congress does - a majority of Congress does. Both the GOP-controlled House and the Dem-controlled Senate MUST AGREE on what a CR spends. CRs are done every year. you need a majority of the GOP-controlled house for anything that is in a CR. The stimulus is not.

    Obama also cannot spend a penny that Congress as not approved - either. Why don't you at least try to deal with facts guy? .

  • Enron

    "... firing offense to engage in this kind of Charlatanism" because the SEC would be on you like a ton of bricks to say nothing of the Wall Street types who smell cooked books from miles away.

  • Enron

    The
    Democrats and Republicans have gerrymandered so many safe Congressional seats
    that the Democrats running with little or token opposition can run and run on
    increasing spending. When a Republican state legislature creates safe
    Republican seats, it also creates safe Democrat seats and vice versa. With the
    help of the so called main stream media beating the Democrat's drum, the
    Republicans are pretty much forced to spend or be labeled as Scrooges.

  • nehemiah

    Congressional Ethics??? Could be my favorite Oxymoron.

  • randian

    The stimulus is not, which is meaningless when the government is spending as if it is. On what I can't tell, since I've had no noticeable improvement in quality of life as a result of it.

  • http://profiles.google.com/maruadventurer john mcginnis

    Isn't Congressional Ethics in the same league as Military Intelligence??

  • http://profiles.google.com/maruadventurer john mcginnis

    I should point out that these kind of shenanigans are carried out in the corporate world. The classic is the Executive Incentive Bonus. Word goes out in January on a inquiry as to which projects will complete on time and budget in the outlying year upcoming. The exec then makes that the target for the incentive. It is a known fiat accompli and the execs bonus is as good as in the bag.

  • Rick Caird

    Not quite. The Executive actually has to manage those project to completion and not over commit on new projects. Sales quotas operate similarly. The sales forecast is massaged and then a "stretch" factor added. In a fixed territory, it would be pretty silly to assign a quota with no knowledge of what is possible.

  • http://twitter.com/tweetrific Bob Smith

    It's somewhat odd to call that a "shenanigan". If preferring on-time/budget projects is a shenanigan, what should we call preferring projects that won't be on-time/budget?

  • marque2

    I understand that some projects are pushed ahead by a month so they finish right before the year end so the executive gets a bigger bonus. But if the project is early by a month then he won't get the bonus for that project in the next year. I don't quite see the issue with completing projects faster than scheduled.

    I actually wish government would consider ways to do the same. If the President got a bonus based on an on time, under budget factor, like CEO's we would have much more efficient government (assuming they didn't load a whole bunch of projects they never intended to do and called the cancelled project "under budget")

  • marque2

    Military Intelligence turns out to be better than the civilian intelligence services (like CIA) by a long shot.

  • marque2

    Maybe the SEC should go after Congress?

  • marque2

    Actually thems the facts. That is why the Senate hasn't provided a budget, because then the baseline is automatically the previous years budget.

    Why are you being delusional? Your comment above doesn't even make sense.

  • bigmaq1980

    Agree.

    @LarryGross:disqus the spending was initially approved by Congress, but the lack of an annual budget (required by law, btw, but without consequence when it is violated) forces the government into either a shutdown, or a Continuing Resolution.

    This is all a calculated strategy by the Dems to bypass the deliberative checks and balances process that was set out for managing the budget, effectively locking in $1T+ deficit spending.

    The consequence has been the series of crises we have been seeing as the GOP attempt to force a deliberation process at various leverage points (e.g. "fiscal cliff", "debt ceiling").

    Effectively, they could have forced a shutdown for lack of a budget agreement, but they know from the 90's that they fared poorly out of that, so they agree to a CR.

    Turns out the Dems and the MSM do not give the full context of what is going on here, only saying that the GOP are being "obstinate" and putting the country in jeopardy, when it is the Dems who are unethically and illegally avoiding the processes set out to negotiate and agree on a budget.

    The GOP have been strategically weak on this issue from day one. Heck, within days of the election, unprompted, they unilaterally offered "revenues". If the issue is spending, they had no business agreeing to that right off. I think they only realize "now" that not have a budget has been a strategic ploy by Obama and the Dems!

    In fact, the GOP have been so weak, many are concerned that they have any conviction about what they espouse, and are really only posturing to maintain their "base".

  • Gary

    I wrote that Reid used "a series of 'continuing resolutions'" to "put federal spending on autopilot, maintaining the heightened 2009 level." I did not mean that Reid himself passed the continuing resolutions. Everyone knows that Reid cannot pass bills by himself. Only a fool would suggest otherwise.

    What I meant was that the refusal by Democrats to offer an actual budget was a tactic that forced a series of continuing resolutions in lieu of the normal budget process. And yes, Republicans actually voted for these bills.

    In any case, it does not change my main point which was the deafening silence about the extra 20% added to the federal budget since 2009's "one-time" stimulus bill. When they passed the continuing resolutions, did the press or Republicans or conservative commentators forcefully announce that the temporary resolution would maintain spending at about the 2009 rate, which included the stimulus bill? That is, we're going to keep on spending as if we had a stimulus bill EVERY YEAR? In all the talk about deficits exceeding $1.0 trillion or the recent hike in the top tax rate and balancing the budget, why did we hear little or nothing about the fact that federal spending had jumped up by over 20%--for no good reason except to maintain 2009's stimulus level???

    Of course Obama and the Democrats would want to keep quiet about this. They just got a 20% bump in federal spending with almost no hoopla and little public awareness of the increase. My question is about the deafening silence coming from Republicans and conservative/libertarian commentators. Why are they not shouting loudly about this 20% increase? Why are they helping the big-government types let this $700+ billion in extra spending fly under the radar?

  • marque2

    Thanks very good explanation. Hopefully Larry reads it.

  • LarryGross

    what? you cannot spend money without a CU and a majority has to vote for it. This is no "automatic extension" of the last budget. In fact 70 GOP voted AGAINST the last CR but twice as many approved it.

    The GOP has continued to approve the CRs when if they had any guts they would have voted aginst it and/or forced cuts in order to get their vote.

    The GOP is not weak - they are worse, -they are feckless hypocrites who say we have a spending problem but lack the backbone to identify where the cuts should be made and to take that position when the CRs get voted.

    do you want the link to the last CR vote that shows the GOP voted in the majority for it?

    the least folks can do here is to admit the complicity of the GOP in failing to cut spending. It's delusional to continue to believe the GOP plays no role in the spending.

    If the GOP had a backbone - they'd refuse to vote the CRs. The truth is they have no backbone.

  • LarryGross
  • marque2

    Larry listen, if you don't pass a budget it gets baselined from the previous years spending with a percentage added to account for natural growth even if the economy is not growing. The stimulus plan was done in 2009, and we have not had a budget since so the stimulus has been baselined into the budget. And we have had a few continuing resolutions to fix some minor things.

    The house has passed a budget every year, there is very little they can do to convince the Dem controlled senate to do the same and try to negotiate, when it will cut the gravy train they discovered by being insubordinate.

  • LarryGross

    that's how they compute the guideline. They are also free to spend more or spend less and they have to vote on it. There is no rule that says you have to spend what you did before. Read up on it guy. 165 Republicans voted to continue spending without cuts while 70 opposed it: http://clerk.house.gov/evs/2012/roll579.xml. the stimulus was NOT baselined in the budget either guy. You need to be looking at some credible sites and stop frequenting the propaganda sites.

    and why would you vote to continue spending at the original debt-inducing rate and then a couple of months later vote against increasing the debt limit? what kind of sense does that make?

  • http://www.facebook.com/people/Steve-Walser/100000639217692 Steve Walser

    And these are the "informed persons" that we need to entrust with life and death decisions over American citizens as we jettison due process because Obama has a nice family. We are so screwed and we are doing it to ourselves!

  • Gary

    I think the Redstate link provides a partial answer to my question. The fact that so many Republicans voted for CRs that maintained spending at the inflated rate explains their silence on the issue: they couldn't forcefully denounce something they had just endorsed. Though, to be fair, their only other option was to shut down the government, and they had good reason to believe that tactic wouldn't work very well for them.

    Although Redstate did call the CR "disastrous," they failed to mention that it continued to pay for the overwhelming majority of the "one-time" stimulus plan. And I have heard very little of this from conservative or libertarian commentators. This is still a mystery to me given how outrageous it to increase spending by over 20% with so little discussion or notice, repeatedly paying for most of a stimulus that was sold as an "emergency, one-time" program.

  • Gary

    With regard to CRs, Wikipedia says (http://en.wikipedia.org/wiki/Continuing_resolution):
    "In order to prevent the interruption of government services [due to failure to pass a budget], Congress will often pass a continuing resolution. This authorizes government agencies to fund their agencies at the current level until either the resolution expires, or an appropriations bill is passed."

    According to http://www.thisnation.com/question/003.html:
    "Generally, a CR funds agencies or programs for a month or two at the same funding level as the previous year."

    I don't know if the law requires or encourages CRs to maintain current spending levels, but clearly there are powerful reasons why this ends up as the default position. Firstly: after budget negotiations have failed, there is little time to do anything else. Secondly, significant budget fluctuations via a series of CRs would cause serious disruptions to government operations. Finally, anyone who tried to make significant, last-minute changes to the budget would be portrayed as unreasonable and obstinate, holding government operations hostage to advance his own agenda. Thus I strongly suspect that, practically speaking, it is extremely difficult to make a CR to do other than basically continue spending at current levels.

    Therefore, when the Senate votes down (or won't consider) all budgets sent over by the House--and refuses to make a counter-offer of its own--they force CRs to happen, which in turn maintains current spending levels. Thus, the characterization of Reid and Senate Democrats as "putting spending on autopilot" or "increasing the baseline" are fair ones. This is the tactic they've used to maintain most of 2009's inflated stimulus-plan spending level.

  • LarryGross

    The CRs have flexibility. Spending CAN be reduced if they want. They can also add spending in both cases - both houses of Congress have to agree to what is in the CR.

    The stimulus went on for two years but it spreads across 3... but it did not continue. For instance, the 2% payroll reduction (that was stimulus) has gone back to the original level. The $400 make-work-pay credit that people got on their taxes for two years is not on this years taxes. There are no new stimulus projects but even if the POTUS wanted them - Congress would have to agree and they will not.

    Except for the stimulus and a couple of things like unemployment benefits, the money in the budget was not put there by Obama or more correctly put - was not advocated by Obama and agreed to by Congress. Redstate called the CR "disastrous" precisely because in Redstate's opinion the GOP should have insisted on cuts in order to gain their support and the GOP just went along with continuing spending as before.

    you are simply wrong about the stimulus guy. you need to google it. It has a specific dollar amount attributed to it. There is no stimulus in the CRs except to finish out what was not complete.

    Almost all of the spending in the budget was approved before Obama even took office.

    and the problem is that the deficit was relatively small under Bush because the tax cuts were just starting to take effect and then the economy tanked and between those two things - revenues plummeted - making the deficit worse - and it continues - because tax revenues still have not recovered.

    The GOP does not want to specify the cuts - even though they are the guys who doubled the DOD spending and added Medicare Part D before Obama was even elected.

    Now the GOP wants Obama to name the cuts but they don't want him to cut DOD even though their budget doubled from 2000 (and so did entitlements - in part because of the new Part D drug subsidies).

    you may notice, for instance, the GOP does not name the entitlements cuts specifically. Even though they pushed through Medicare Part D - you don't hear any of them saying it was a mistake and should be repealed. They wanted to make all of Medicare a voucher system but if they stuck to that - they'd get voted out so now they want Obama to name the entitlement cuts instead.

    My view is that if someone thinks we need to cut entitlements, then they need to step up and stick to their principles and name the cuts - no matter what Obama does or does not do.

    If you believe cuts need to be made - then you get on your horse and shout the truth and get on with it. Hiding from the issue by saying Obama should name the cuts is just feckless hypocrisy but then it's also feckless hypocrisy to say we have a spending problem and you want to not approve extending the debt - when two months earlier you voted in favor of the CR.

  • LarryGross

    there are few rules for CRs. If you read the articles about the Sept 12 CR, Redstate and other Conservative sites were saying that the GOP should have reduced spending, in the CR.

    When the two houses fail - both parties - to agree on a budget, yes they have to go to CRs to do it but see here's the rub. If your are the GOP and you want cuts in the budget and the Dems will not agree then you have to go to the CR, the GOP then has the opportunity to require the cuts if they are to support it - or else let the govt shut down.

    The Senate could not put anything on auto-pilot without the GOP also agreeing and they did.

    The GOP could have voted against the CR - 70 of them did just that.

    but this is what happens when neither side will agree on a budget and the GOP's budget makes Medicare a voucher program and repeals ObamaCare. Should anyone expect the Senate to agree to that? You HAVE TO WANT to find a compromise. You cannot try to force the Senate to swallow something they do not agree to. The Senate is simply not going to agree to any budget that changes Medicare to a voucher system or repeals ObamaCare. Any budget that comes from the house to the Senate has to be a budget that will gain enough Dem votes to get a 60 vote combined Dem/GOP majority. If you're not going to send a budget to the Senate that will gain that level of support then what is the purpose of sending something you know - will not be accepted? That's what forces the CRs... If a compromise budget had been sent to the Senate that could gain 60 votes, there would have been no need for the CR.

    you're wrong about the stimulus. It's a one time expenditure spread over 2 years.

    the GOP would never agree to extend it.

  • Gary

    Note: excerpts from your post in quotes; my replies below.

    "...both houses of Congress have to agree to what is in the CR."

    Already stipulated. And Harry Reid is not able to pass CRs by himself. Everybody knows this stuff.

    "...the money in the budget was not put there by Obama or more correctly put - was not advocated by Obama..."

    Irrelevant.

    "...and the GOP just went along with continuing spending as before."

    They didn't just go along. They held their noses and voted YEA rather than cause a government shutdown.

    "you are simply wrong about the stimulus guy. you need to google it. It has a specific dollar amount attributed to it. There is no stimulus in the CRs except to finish out what was not complete."

    You simply misinterpreted my post, guy. You don't even need to google it. The CRs contained a huge bump in spending, continuing the 2009-2010 levels up to the present AS IF the stimulus plan were still going on. As I wrote, the CR "continued to pay for the overwhelming majority of THE 'one-time' stimulus plan." In effect, we are "repeatedly paying" for THE stimulus plan. Let's be absolutely clear. There was an American Recovery and Reinvestment Act of 2009, but not an American Recovery and Reinvestment Act of 2010 or an American Recovery and Reinvestment Act of 2011 or of 2012. The CRs spend at an inflated rate. They do not run new stimulus projects.

    Not that it really matters. The stimulus was a silly grab-bag of wasteful goverment spending that did little or nothing to boost the economy. The 20+% increase in subsequent budgets also are a silly grab-bag of wasteful government spending.

    "Almost all of the spending in the budget was approved before Obama even took office."

    Irrelevant.

    "the problem is that the deficit was relatively small under Bush because the tax cuts were just starting to take effect and then the economy tanked and between those two things - revenues plummeted - making the deficit worse - and it continues - because tax revenues still have not recovered."

    Now we're getting somewhere. Bush did it. I just googled it. Got 2,780,000 hits when I searched "bush's fault economy". Must be right; it's on the internet.

    "The GOP does not want to specify the cuts - even though they are the guys who doubled the DOD spending and added Medicare Part D before Obama was even elected."

    I get it. The fact that prior administrations overspent justifies doubling down, massively increasing spending and deficits. Maybe we should try for $2.0 trillion deficits. Do I hear $3.0 trillion, $4.0 trillion? Nothing bad can come of this. We just owe the money to ourselves (and China).

  • Gary

    Note: excerpts from your post in quotes; my replies below.

    "When the two houses fail ... the GOP then has the opportunity to require the cuts if they are to support it - or else let the govt shut down.

    The Senate could not put anything on auto-pilot without the GOP also agreeing and they did."

    It's not a reply if you don't address my points. I've already noted the Redstate link stating that only 70 House Republicans voted against the CR of September, 2012.

    Some Republicans had to vote for all the CRs. Otherwise, they wouldn't have passed and there would have been a big ruckus over a government shutdown--and the Republicans certainly would have been blamed for being stubborn and unreasonable. But I'm not here to shill for the Republican Party. When you cannot make the case for cutting a deficit-plagued budget that has just been raised by over 20% for no good reason, you're pretty lame communicators and political tacticians--even accounting for the fact that the entire mainstream media would have tried to swamp their message like a giant tsunami.

    "but this is what happens when neither side will agree on a budget and the GOP's budget makes Medicare a voucher program and repeals ObamaCare. Should anyone expect the Senate to agree to that? You HAVE TO WANT to find a compromise."

    Now you've convinced me. Senate Democrats are extremely reasonable and willing to compromise. Especially Harry Reid. That's why they never made a counter-offer to the budgets sent over from the House. And why they just voted them down. The fact that a series of temporary CRs in lieu of a normal budget helps lock in higher rates of spending is merely coincidental. The unprecedented time period without a budget demonstrates the Senate's willingness to bargain in the same manner as previous Senates have. Right.

    I've acknowledged the Republicans' contribution to this disaster, but your opinion seems to be that Democrats have nothing to do with these huge budgets and gigantic deficits. This strikes me as particularly odd given that the Dems don't want to cut ANYTHING, and (as previously described) the series of CRs was a strategy of Reid and Senate Dems to maintain inflated spending rates. Essentially, the GOP's blame in this is being too feckless to stop them (a handful of Repubs probably liked the 20% budget increase, but not most).

    The impetus for my initial post was that the federal government was already WAY too large under Bush (with big deficits) and Obama/Dems only want to make it MUCH bigger, with humongous deficits. I meant to highlight the fact that a spending increase of over 20% was flying under the radar, basically going unnoticed--which is bizarre and outrageous. But you don't seem too concerned about big government getting even bigger, chewing up nearly 25% of GDP, confiscating that money from taxpayers, wasting tons of it and soon to cause a huge disaster because of repeated deficits of over $1.0 trillion. Your concern seems to be to pin half or most of the blame on Republicans.

    "you're wrong about the stimulus. It's a one time expenditure spread over 2 years."

    No need to mention this twice, guy. It's a misreading of my post. I've already addressed this. See previous reply.

  • LarryGross

    re: "irrelevant" .. very relevant to correctly identify who can and who cannot "spend"..

    re: holding nose... the spending in the CRs came in large part from the Congresses BEFORE 2009 - and no subsequent Congress cut any of the spending that was in the budgets PRIOR to 2009. Both parties just carried it forward .

    re: the stimulus - grab bag... stipulated... the point of stimulus is to stimulate increased aggregate demand to jump start a stalled economy. It's considered a valid tactic by most economists in most countries when the economy stalls.

    re WHEN the spending started - is not irrelevant when people blame Obama for it. He had virtually nothing to do with it.

    re: Bush did it. the spending was increased - DOD/National defense essentially doubled. Medicare Part D was passed - taxes were cut - the economy tanked and revenues shrunk further.
    these are facts. I'm not blaming Bush. Bush ADVOCATED for the spending and cuts and Congress agreed and Bush signed it. That's true also.

    re: justification for doubling down. Nope. It's just that Obama did not create the debt and he cannot cut the spending. Congress created the debt and only Congress can cut it.

    I'm just seeking the truth on this. When we say Obama has added 5 trillion to the debt - that simply is false. He has added nothing to the debt. What he did not do - was advocate for cuts - that's totally true but at least he did not do what Bush did - who advocated for increased spending at the same time he advocated for cutting taxes... and there was no PlanB if tax revenues fell even further behind ... what was originally counted on to keep the deficit spending low. When the economy tanked the small deficits exploded when tax revenues cratered.

  • LarryGross

    re: rukus over govt shutdown. It depends a LOT on the scope of the cuts. If they are saying they are going to shut the govt down unless we balance the budget and they offer no reasonable budget to do that.. then they simply are not serious and just engaging in kabuki theater.

    re: "reasonable" Senate. No "reasonable" Senate is going to agree to essentially destroying Medicare and repealing ObamaCare and STILL not end up with a true balanced budget.
    It's not a serious proposal and the Senate as much as said that.

    re: too big under Bush. we agree but Bush and company have billed themselves as fiscal conservatives and Dems have always been characterized as tax&spenders.

    Why would anyone with half a brain be expecting Obama to be a better fiscal conservative that those who claim they are and have always claimed so?

    What exactly can Obama seriously do ? Do you want him to advocate cuts against things he believes should not be cut? Why would you expect him to act like a fiscal conservative when the folks who say they are - won't act like fiscal conservatives themselves?

    have I got a point?