PORKBUSTERS UPDATE: Robert Novak looks at “corporate porkbusting:”
Half a billion dollars is chump change at the Pentagon. But it is a symbol that the intensifying battle against individual lawmakers’ earmarks in spending bills is turning to corporate welfare. That category of pork until now has been inviolate, protected by a bipartisan conspiracy of silence.
The Northrop Grumman earmark was inserted by the Senate Appropriations Committee chairman himself, Thad Cochran of Mississippi. That once would have guaranteed passage without public notice, even though the Defense Department and the Navy oppose the spending as wasteful.
But pork-busting freshman Sen. Tom Coburn of Oklahoma now scrutinizes money bills, and he caught the Northrop Grumman earmark. The company, whose revenue last year totaled $40.7 billion, has received $500 million from its insurer and is in litigation seeking another $500 million. The Defense Contract Management Agency has declared “it would be inappropriate to allow Northrop Grumman to bill for costs potentially recoverable by insurance because payment by the government may otherwise relieve the carrier from their policy obligation.” Factory Mutual Insurance Co., with 2004 revenue of $2.7 billion, then would be receiving indirect corporate welfare.
Coburn told the Senate on May 2 that the Northrop Grumman payment “sets a terrible precedent for the future.” He called it “a step too far. I believe we need to back up and let the private sector take care of its obligations.” He mentioned unspecified federal “largesse” for the company, pointing to the questionable DDX destroyer. . . .
Efforts such as Coburn’s over the years have been slapped down hard, but not this time. The Coburn amendment barely lost, 51 to 48, in a rare Senate vote crossing party lines. Republicans split 28 to 27 against Mississippi’s powerful senators, with John McCain and Majority Leader Bill Frist supporting Coburn. Democrats voted 24 to 20 for Northrop Grumman. North Dakota’s twin deficit hawks, Kent Conrad and Byron Dorgan, voted with Coburn, but Edward M. Kennedy, Hillary Clinton and Democratic Leader Harry Reid supported corporate welfare.
The House Appropriations Committee not only rejected the Northrop Grumman payment, but asserted that federal money should not “substitute for private insurance benefits.”
Keep the pressure on.