North Dakota tightening the belt

Earlier this week, Barack Obama released his budget proposal of $3.8 trillion for the fiscal year 2011. Amid the varied reactions of his political allies, opponents, the mainstream media, watchdog groups, millions of political bloggers, and basically anyone with a Twitter account, only one thing remains clear: public budgeting is hard.

Not only is it difficult to even begin making sense of how to fund our broad and complex bureaucracy, but we tend assign the budgeting process the unrealistic expectation that it should simultaneously address many, often antithetical goals. For instance, in the midst of the current recession, we expect the federal budget to continue to promote economic recovery, create jobs, but still reduce our sky-high deficits.

Yet no discussion of wasteful spending is complete these days without addressing our most popular budgeting buzz phrases-pork barrel spending. We generally define a pork barrel project as one that benefits a specific geographical area, but are funded through tax revenues collected from every part of the country.

Such projects are not generally considered on their own merit, but are often tacked on by members of congress to larger budget and appropriations bills. The most familiar examples used in recent memory to criticize such projects have been Alaska's "bridge to nowhere," or Boston's much maligned "Big Dig."

David Flynn, a professor of economics at UND, discussed the political realities at play. "This is part of the way candidates make themselves desirable to the electorate-they've brought home projects." He added, "Is it the best use of taxpayer dollars? Maybe; maybe not. But if you go to the people in those areas, they find those dollars and the projects they finance of terrible importance."

To put it even more simply, we seem to only have a problem with the pork that is on someone else's plate. What someone outside of our state may point to as wasteful federal spending, might be a project that we in the Red River Valley consider vital.

Examples include flood prevention measures, or funding for the University of North Dakota Energy and Environmental Research Center (EERC), which brings hundreds of high-paying technical jobs to the region, with economic impact far beyond that.

Even Rep. Ron Paul (R-TX), one of the House of Representatives' harshest critics of government waste, told Fox News in 2009 that, "Earmarks are the responsibility of the Congress. We should earmark even more." The point he is trying to make is that if a legislator refrains from proposing or voting in favor of earmarks, they do not create a cent of savings for the federal government. More likely, the funds will just be earmarked to benefit the citizens of someone else's district, or by the administration.

What becomes clear is that the fervor over pork barrel spending is more a case of political finger wagging than it is an objective assessment of budget processes.

Here At Home North Dakota fairs particularly well in the overall budget equation. According to the Tax Foundation, a conservative think-tank that publishes research on a range of tax policies, for every one dollar that our state paid to the federal government in 2005, we received $1.68 in return. North Dakota consistently ranks in the top five in this category.

This success in procuring federal funds is due in part to the seniority and influence of N.D.'s congressional delegation. So one question that arises is whether Senator Byron Dorgan's retirement at the conclusion of the 111th Congress will be detrimental to North Dakota's role in the process.

Flynn thinks that it could have some negative effect, but his opinion is that other political factors in Washington may play a bigger role. As he put it, "Fiscal discipline in the face of a down economy has consequences."

North Dakota could be one casualty of those consequences. Because of our circumstances, the state could actually end up suffering as a result of an increased level of fiscal responsibility in Washington. Due to our small population size, the per-person cost of federal spending projects in our state is naturally higher. This fact, along with our relatively healthy state economy-boasting one of only two budget surpluses among the fifty states-may have the effect of weakening the justification for North Dakota to receive federal funds at the rate that we historically have.

According to Flynn, if policy-makers do end up practicing what they preach on fiscal responsibility, "Then you go on to the question of do we find North Dakota, or states like North Dakota, on the outside looking in."