A Corps Skilled in Running Up the Debt

The first thing Congress did after the shutdown was throw more money at the wasteful Army Corps of Engineers.

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An excavator digs a drainage trench at a U.S. Army Corps of Engineers dredge disposal site in Charleston, S.C., on Tuesday, March 5, 2013. Charleston District Engineer Lt. Col. Ed Chamberlayne said Tuesday rthat automatic federal spending cuts could delay the $300 million project to deepen the Charleston Harbor shipping channel.

Fresh off the 16 day government shutdown, the House of Representatives is back at work avoiding making the difficult choices that would help put the country on a better fiscal path.

Yesterday, the House debated the inaccurately dubbed Water Resources Reform and Development Act, H.R. 3080, a huge bill that authorizes spending on billions of dollars of water projects, studies and policies for the Army Corps of Engineers. The Army Corps of Engineers is an agency in desperate need of reform, priorities and fiscal discipline. It has a long history of cost overruns and mismanagement. And in the past, among other systemic fiscal challenges, its budget was allocated primarily thorough the earmark system, which left project decisions particularly vulnerable to political pressure rather than merit and prioritization.

Reforming the Army Corps of Engineers would have been a perfect opportunity for the House of Representatives to prove its seriousness about saving money, rooting out waste and holding government bureaucracies accountable. Unfortunately, the bill the House produced does little of those things.

[See a collection of political cartoons on the budget and deficit.]

What's wrong with thebill? It's a long list, but let's look at a few top problems.

First, the bill does little to correct a decades long problem of the Corps' project construction backlog. The Corps has a long tradition of maintaining an enormous backlog of projects that are authorized or identified as in need of construction. Currently, the backlog is estimated to include between $60 - $80 billion in projects.

To put that in perspective, the Corps only gets about $2 billion in construction funding annually. Spreading money around for all these projects ends up delaying project completion, increasing construction costs and delaying delivery of project benefits. The bill directs the Corps to identify $12 billion worth of projects for deauthorization, but considering it spends upwards of $8 billion there's only a few billion dollars of net backlog reduction.

Second, while H.R. 3080 does replace the earmark system for identifying projects to be authorized, it includes no prioritization system or performance measures to identify which projects should go forward and in what order. The system just enables local authorities, instead of lawmakers, to submit projects to be authorized rather than setting up criteria to ensure good decision making. Part of the inexorable growth of the backlog came from the perception that authorizations come cheap – they don't spend the money, they're just a license to hunt. Instead of demanding a higher return on investment of authorization or other performance measures, the bill keeps the low bar that any project which returns a penny on the dollar invested is green lighted. This will likely add to the backlog.

[See a collection of political cartoons on Congress.]

Third, the bill would actually require increased spending and increase subsidies instead of reforming broken systems. The Harbor Maintenance Trust Fund has been flush with surpluses in recent years. Instead of reducing the tax rate or eliminating cross-subsidies within the system and creating a true user fee, H.R. 3080 simply requires greater payouts from the  trust fund and enables spending federal tax dollars on non-federal projects.

As a country, we face serious fiscal challenges. We didn't accumulate a $17 trillion dollar debt by making one bad decision, but by habitually spending more money than we take in and failing to make difficult decisions about just what we can afford to do as a country. The fact that the first major bill considered after the government shutdown continues this trend – even including yet another subsidy for the infamous "Kentucky Kickback,"  the lock and dam project that received funding in the deal that reopened the government – tells us Congress is still not serious about solving our problems.

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