TOP DRAWER ARTICLE

 

Got Pork?
by
HL Carpenter

 

OINK! That’s the sound of politicians at the trough.

Pork, or allocations in the federal government’s budget for local projects, affects everyone’s tax dollar. As an example, you’ve probably heard about Alaska’s bridge to nowhere. This type of political appropriation, also known as an earmark, has been around a long time.

But embedding earmarks into the many works funded by treasury appropriations has grown at an ever-increasing rate. And when lobbyists got into the act, earmarking jumped up another notch. Inserted into government projects by legislators influenced by lobbyists, pork mostly benefits the lobbying firm’s client and the lawmaker into whose district the money flows.

Of course, not all pork is bad. Earmarks may be added to a project to make it better, or because a necessary part of the project was omitted in the original appropriations bill. If pork is attached to a project for those reasons and life is made better for more than just a few, it can be a good thing.

Unfortunately, one of the problems has been the lack of information, such as a way to tell who asked for the money, or who is benefiting. But a new bill signed into law on September 26, 2006 will bring that kind of accountability to pork. The Federal Funding Accountability and Transparency Act calls for creation of a free, searchable public database of every entity receiving federal funds.

Even with the new legislation, no one expects pork to vanish. But perhaps over time more oversight will mean less oink.

 

Originally published November 2006.

 

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HL Carpenter, an experienced investor and a CPA, specializes in reader friendly financial and tax topics for individuals and small businesses, and publishes Top Drawer Ink, a newsletter that's chock full of humor and common sense information.

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This information should not be considered legal, investment or tax advice. Top Drawer Ink Corp. does not provide legal, investment or tax advice. Always consult your legal, investment and/or tax advisor regarding your personal situation.

 

 

Last update: January 8, 2011

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