Earmarks in Another Form

The lead article in today’s New York Times, “Companies Find Ways to Bypass Earmarks Ban,” describes attempts by a variety of groups to circumvent the new prohibition against earmarks — hidden legislative grants inserted by individual representatives to benefit businesses in their districts.

Apparently, non-profit organizations are exempt from the ban so businesses are creating their own mini-charitable organizations, or using educational institutions, who then pass on the bulk of the grant back to the business. The process comes complete with lobbyists and all the other unsavory elements supposedly outlawed by the ban on earmarks.

The New York Times expose should not come as any surprise to anyone who has followed previous reforms in a variety of areas, including campaign finance. There always seems to be some loophole in the legislation allowing clever lawyers or lobbyists to take advantage of the new situation.

The article provides several examples of the exploitation of the new “non-profit loophole,” focusing on the acquiescensce of a particular representative, Marcy Kaptur of Ohio, to a defense contracting firm in her district. The firm has contributed several thousand dollars to Ms. Kaptur’s campaigns and created a non-profit group that manufactures the same product and is located at the same address.

One observer used the phrase in Jurassic Park, “Life will find a way,” to describe the inevitable evasion of reform attempts by Congress. One would hope this “way” is swiftly remedied.