Conservatives Warn Trump Not to Revive Earmarks If He Wants to Drain the Swamp

Some conservatives are sounding the alarm over reinstating earmarks in Congress, as President Donald Trump voiced support Tuesday for reviving a budgetary practice that critics say feeds cronyism and corruption in government.

“I hear so much about earmarks and how there was a great friendliness [among lawmakers] when you had earmarks,” Trump said Tuesday in a bipartisan meeting on immigration with House and Senate members.

“Of course, they had other problems, but maybe all of you should start thinking about going back to a form of earmarks,” the president said.

“The time is right” to reinstate earmarks, Rep. John Culberson, R-Texas, said, The Washington Times reported Sunday.

In a statement provided Wednesday afternoon to The Daily Signal, Culberson said earmarks could help his district recover from Hurricane Harvey, which devastated Houston, among other areas, with flooding.

“Hurricane Harvey changed everything for my district, and it’s my job as a representative to be an advocate for my constituents,” Culberson said.

Conservatives long have opposed earmarks, which direct taxpayer money to lawmakers’ special interests and projects through the budget without competition based on merit. Lawmakers banned earmarks under House rules in 2010.

Rep. Mark Walker, R-N.C., chairman of the Republican Study Committee, the House’s largest GOP caucus, told The Daily Signal in a phone interview that bringing back earmarks isn’t an option for him.   

“My position on earmarks hasn’t changed,” Walker said, adding:

I think it’s a very slippery slope to bring back something that has been abused by so many, so much of the time. … Members [have] to grovel to work out bills and be influenced to vote for legislation they may or may not have even supported at some point. So I think it’s a legitimate concern; I worry that earmarks would allow the algae-infested waters to start filling up the swamp.

Rep. Scott DesJarlais, R-Tenn., a member of the House Freedom Caucus, told The Hill about bringing back earmarks: “I don’t know that I’m opposed to it.”

“Since Congress holds the power of the purse, members of Congress should be able to direct the Army Corps of Engineers to move more rapidly on a flood control project,” Culberson told The Daily Signal.

The Texas Republican, whose district includes parts of Houston, said earmarks would be a way to help his district recover:

I’m proposing that we restore the ability of members of Congress to direct money toward flood control or highway projects when we receive a request from a local or state unit of government. We would submit the request at the subcommittee level, and the request would then go through the entire legislative process, out in the open, so that the public can see it and debate it. Most importantly, these projects would not increase spending. It’s good public policy.

A reporter for The Washington Post tweeted that Marc Short, Trump’s director of legislative affairs, is not as keen as the president on reinstating earmarks:

The White House did not respond to The Daily Signal’s request for comment.

One conservative House staffer told The Daily Signal in an email Wednesday that reinstating earmarks would go against Trump’s pledge to drain the swamp.

“If you’re going to drain the swamp, reinstating earmarks is the last thing you should do. Congress banned earmarks because members were wasting taxpayer dollars and illegally enriching themselves,” the aide said. “Restarting that practice is not what everyday Americans sent us here to do.”

Other conservatives with influence on Capitol Hill are not happy with the development, either.

“I think [Trump] is getting bad advice on this and basically I think he has been frustrated that Congress hasn’t passed much of his agenda other than tax reform, and somehow believes that if they were able to reinstate earmarks, the rest of his agenda would get passed,” Wesley Denton, senior communications director at the Conservative Partnership Institute, told The Daily Signal in an interview.

“The truth is, what it would simply bring back is corruption and bribes and more big spending bills,” Denton said.

In a statement emailed to The Daily Signal, David McIntosh, president of the free-market group Club for Growth, decried the talk of reviving earmarks.

“If Republicans bring back earmarks, then it virtually guarantees that they will lose the House,” McIntosh said. “Bringing back earmarks is the antithesis of draining the swamp.  Earmarks will only benefit the special interests that grow government at the expense of working men and women.”

Mike Needham, chief executive officer of Heritage Action for America, the lobbying affiliate of The Heritage Foundation, said in a statement provided to The Daily Signal that resurrecting earmarks should not be an option.

“It is nearly unthinkable that after President Trump ran a historically successful election to ‘drain the swamp’ in Washington, D.C., Congress would consider reinstating one of the most egregious examples of cronyism on Capitol Hill,” Needham said, adding:

President Trump should continue to work with conservatives in Congress to drain the swamp and stop any congressional efforts to reinstate earmarks. Heritage Action is dedicated to working alongside President Trump to end cronyism and pass real conservative solutions that actually help hardworking Americans.

The House Rules Committee will hold a hearing  for members on reinstating earmarks on Jan. 18, and another hearing Jan. 19 with outside organizations, Politico reported.

This article has been modified to identify Walker correctly as chairman of the Republican Study Committee.

The post Conservatives Warn Trump Not to Revive Earmarks If He Wants to Drain the Swamp appeared first on The Daily Signal.

Pulp Nonfiction: A Tale of Protectionism and Newsprint Producers

Which skill is more important, knowing how to run your business or knowing how to get the government to stymie your competitors? The case of a paper mill in Washington state shows the sad answer is “not clear.”

Thirty years ago, you would have been holding a newspaper in your hands while reading this commentary. The tech revolution of the ensuing decades has been great for almost everybody, but not for those making something called uncoated groundwood paper (a.k.a. “newsprint”). However, this is not a secret.

According to their online bios, none of the investment professionals or managing partners at the hedge fund One Rock Capital Partners, which owns the paper mill in question, appears to have any particular experience in the pulpwood paper business.

Even so, they must have known that the newsprint market has been in decline for decades, as physical newspapers lost out to broadcast and digital media. This market has dropped 75 percent just since 2000.

Nevertheless, there must have been reasons for One Rock’s purchase of North Pacific Paper Co., a 300-employee newsprint producer in Longview, Washington. Perhaps the financial and lean-production experience the professionals and managers do claim to have can be transferred to the paper business and help the paper company innovate its way out of a dying business.

However, it looks like until that happens, One Rock is using the other strategy—get the federal government to whack your competitors.

Since newsprint is expensive to transport, competition is primarily regional. So, a big chunk of North Pacific Paper Co.’s competition is just across the border in Canada. The company’s implements of choice in its battle against competition are the anti-dumping and countervailing duty provisions of U.S. trade policy. As with any battle, there is collateral damage.

While trying to protect their year-old investment and, we would hope, some portion of the 300 or so jobs at North Pacific Paper Co., the leaders at One Rock are putting hundreds of thousands of other U.S. jobs at risk. First in line to suffer the effects are those in the declining but still large newspaper and printing businesses. So, it is easy to understand why they strongly oppose s the paper company’s tariff request.

However, in a bit of an irony, some American producers of newsprint, and their employees, also will suffer. How can that be?

The pulp paper business in North America is highly integrated, with many producers having assets both in Canada and in the United States. Severing the supply chain connections from Canada or just taxing away a big chunk of a firm’s revenue from north of the border can significantly reduce overall profitability.

That the American Forest and Paper Products Association opposes the attempt by North Pacific Paper Co. to stifle Canadian newsprint sales is evidence of the aggregate net harm to U.S. firms.

So, how does this translate to American jobs? While the market for newsprint has been in decline, opportunities exist to offset this decline by retooling to make other products and to improve efficiency. However, this takes money. If one revenue stream is taxed away because part of your operation is in Canada, that leaves you less of the money needed for the critical changes to stay profitable and to save those U.S. jobs.

Resolute Forest Products is an example. In the past four years, the company has invested more than $600 million in its U.S. operations to adapt to a changing world.

Yes, its newsprint business is in decline. However, even though we baby boomers don’t want to think about it, the market for another pulpwood product, adult diapers, has a rosy future.

North Pacific Paper Co.’s tariff request would hobble the ability of firms such as Resolute to invest in such new and expanding markets.

To create jobs and economic vitality, companies need to have the freedom to use their own resources to get out of dying markets and into growing ones. Taxing those who are doing just that, in order to bail out investors who appear to be doubling down on the proverbial buggy whips, is not good for U.S. workers or consumers.

An “America first” policy is the one that supports the job-creating investment of a dynamic economy. Taxing newsprint is a backward-looking, America-last, investment-last, and jobs-last policy.

The post Pulp Nonfiction: A Tale of Protectionism and Newsprint Producers appeared first on The Daily Signal.