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  • The America Competes Act: Business-As-Usual in Washington

    This week, the House of Representatives will vote on the $86 billion “America Competes Act.” Just a few years ago, an $86 billion authorization would have been considered real money, even by Washington standards. But in this new era of trillion-dollar spending bills (and, not coincidentally, trillion-dollar budget deficits), an $86 billion bill is not even considered major legislation.

    Yet this provides another opportunity for lawmakers to draw the line on spending and deficits. Members of Congress typically bemoan runaway spending and deficits, even as they continue rubber stamping nearly every spending bill that comes to the floor. Rhetoric about runaway spending, unsustainable budget deficits, and “hard choices” is not enough. For the United States to avoid the fate of Greece, lawmakers must learn how to say “no” to new spending.

    The America Competes Act would reauthorize and expand government research and development (R&D) programs such as the National Science Foundation, the Energy Department’s Office of Science, the National Institute of Standards and Technology, and the Economic Development Administration. Yet total R&D funding already expanded 64 percent faster than inflation last decade, to $165 billion. The R&D programs reauthorized in this bill would receive an additional 30 percent increase by 2015.

    Of course, R&D “investment” programs are popular. However, given America’s other popular spending priorities that lawmakers will not restrain – including Social Security, Medicare, education, antipoverty programs, unemployment benefits, defense, homeland security, highway spending, and veterans’ programs – adding another 30 percent over five years for these R&D programs is not sustainable. Only in economic fantasyland can government programs continue growing 60 percent faster than inflation each decade without pushing deficits and taxes steeply upward.

    Furthermore, many of these programs do not have successful track records. The Economic Development Administration is a notorious boondoggle that federal auditors have repeatedly determined fails to promote economic development. Similarly, the failed Manufacturing Extension Partnership (MEP) program has long been targeted for termination by the Congressional Budget Office. The Technology Innovation Program is merely an outgrowth of the failed Advanced Technology Program, whose record of botched investments is stunning even by government standards.

    It is true that this bill only authorizes the funds, and Congress still must appropriate them. Yet authorization bills should be tools for accountability. They should eliminate failed programs, not raise the spending cap for them. They should consolidate duplicative programs, not layer more new programs on top of them. Authorization bills should demand results, not rubber stamp business-as-usual government. If Congress cannot even freeze and reform these programs after a decade of growth and poor performance, how will they make the difficult reforms necessary to rein in the budget deficit?

    Posted in Economics [slideshow_deploy]

    2 Responses to The America Competes Act: Business-As-Usual in Washington

    1. Pingback: » Financial News Update – 05/12/10 NoisyRoom.net: The Progressive Hunter

    2. Pingback: Shopfloor » Blog Archive » America COMPETES Reauthorization Hits a Bump

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