Congress

The Congress That Cried Wolf

It's time for lawmakers to stop abusing the emergency-spending loophole.

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The newly dominant GOP swept into Washington after November muttering promises about fiscal discipline. But the last time Republicans controlled Congress, they utterly failed to rein in their profligate ways. Their favorite trick: passing large supplemental spending bills and labeling routine funding as "emergency."

In theory, supplemental appropriations—and emergency-designated funds in particular—are intended to provide necessary infusions of cash on matters so unforeseen that they couldn't have been expected to make it into this year's budget and so urgent that they cannot wait for next year's. The Budget Enforcement Act, passed in 1990 to facilitate deficit reduction, gave emergency-designated funding special exemptions from budget restraints.

Although there is no limit on the spending that can be designated "emergency," historically there was an understanding that emergencies are sudden, unanticipated, and temporary conditions that pose a threat to life, property, or national security. And emergency spending was traditionally offset, at least in part, by cuts in other areas of the budget or cuts in future years.

Not lately. Over the past couple of decades, Congress has abused these powers, using supplemental bills to fund predictable, non-emergency activities and refusing to find offsets for legitimate emergency spending. The result has been a significant increase in spending across the board. What's worse, this spending is conducted with little adult supervision, since emergency-designated funding does not have to be justified with the same level of detail as the federal bureaucracy's annual budget requests.

This is big money we're talking about. In Fiscal Year 2009, supplemental appropriations—the main vehicle for emergency spending and hence abuse—reached an all-time high of $207 billion (in 2014 dollars), up from $5 billion in 1998. And whereas supplemental discretionary funding accounted for 1.5 percent of total discretionary budget authority in the 1990s, the figure for the 2000s was 10.5 percent—with a high of more than 16 percent in Fiscal Year 2005.

Fire alarm
Ben Schumin

With the federal budget running surpluses after 1998, policy makers gave up all pretense of fiscal prudence. As members of Congress became more amenable to increased spending, supplemental and "emergency" appropriations took off.

When Republicans took control of Congress in 2003—they already held the White House—the Budget Enforcement Act was conveniently allowed to expire, and with it went the few remaining restraints on Congress' insatiable appetite for writing checks. Not only was supplemental emergency funding now exempt from congressional budget limits, exceeding the spending caps no longer triggered automatic cuts elsewhere.

That allowed the GOP to fund the wars in Afghanistan and Iraq outside of the standard budgeting process. This was particularly outrageous given that, after the first year or two, war needs became fairly predictable. For instance, one of the largest expenditures was salaries and benefits for Army National Guard personnel and reservists called to active duty, hardly an unforeseen development after year two.

Meanwhile, the lack of detail included with supplemental budget requests and the need for expedited approval makes oversight impossible. Attaching the word emergency to a bill automatically increases the pressure to pass it quickly, and no member wants to vote against emergency funding to support troops or to aid the victims of a natural disaster. Voicing opposition becomes politically hazardous, regardless of how unnecessary the spending is.

As a result, "emergency" spending bills are often stuffed with pork or overrun by fraud and abuse. Take federal relief for the Gulf Coast following Hurricane Katrina, which provides countless examples of squandered taxpayer dollars—including $900 million the Federal Emergency Management Agency spent on 25,000 mobile homes that went unused due to the agency's own rule that such homes cannot be deployed on flood plains.

After Hurricane Sandy hit in 2012, legislators jumped at the opportunity to redirect money to their own pet projects. Although most of the more egregious attempts were stripped out prior to final passage, the bill still became an example of politicians trying to solve a problem by adding zeros. The vast bulk of federal Sandy dollars remains unspent: According to an October 2014 report from Taxpayers for Common Sense, only 11 percent of the $48 billion (post-sequestration) relief bill has been disbursed. Clearly, the regular budgeting process could have been used to tackle the post-Sandy situation, and without sacrificing oversight to do it.

Abuse of the emergency spending designation is a bipartisan problem, particularly when it comes to natural disasters. After Katrina, both Republicans and Democrats from affected states called for massive funding without offsets. After Sandy, politicians from both parties in New Jersey and New York did the same. But it's the Republicans, with their lust for boundless military spending, who have really driven the phenomenon. And with the 2011 Budget Control Act limiting Pentagon spending, it's not hard to envision the new GOP-led Congress turning to "emergency" measures to goose the military budget.

Chart on emergency spending
Veronique de Rugy

Supplemental spending peaked under GOP leadership and has decreased during the Obama administration. Over eight years in office, George W. Bush signed into law more than $1 trillion in supplemental spending. So far under President Barack Obama, the figure is around $220 billion. This is partly due to gridlock on Capitol Hill and some friendlier hurricane seasons. Also, Obama has overseen a military drawdown in Afghanistan and Iraq, which helped forestall the need for more appropriations. It is, however, worth noting that the Congressional Budget Office data used to construct the chart at the left omits funding from the 2009 American Recovery and Reinvestment Act (a.k.a. the stimulus), which was really just emergency spending by another name.

Fixing the loophole so only true emergencies trigger infusions of cash outside of the normal appropriations process should be a priority for fiscally conservative lawmakers. Failure to do so makes a joke of purported budget limits, since Congress need only slap the "emergency" label on any appropriations above the cap to keep on spending.

Requiring emergency spending to be offset by cuts elsewhere also makes fiscal sense. In 2009, the Congressional Research Service noted that "had supplemental appropriations been fully offset since 1981, federal debt held by the public could have been reduced by 23 percent or $1.3 trillion."

Maybe things will go better this time. But the better bet is that history will repeat itself.