The LA Times contract reporter Michael Hiltzik wrote a piece criticizing me for my chart and post here on The Corner about improper government payments. His main beef with me is that I cherry-picked programs to single out welfare programs. I assume this confirms his belief that I am a heartless “conservative.”
He writes:
One point that catches the eye right off is that almost all the programs on which De Rugy trains her firepower are anti-poverty programs. They include the earned income tax credit, which has been hailed as one of the most effective anti-poverty programs ever, Supplemental Security Income, Medicaid, food stamps, and school lunches and breakfasts. . . .
Then he writes:
Curiously, De Rugy’s list doesn’t include programs such as energy industry handouts or farm subsidies, the capital gains tax break, or other such deals that chiefly benefit the non-poor.
But that’s not her agenda. She’s talking explicitly about “government spending on social welfare programs,” which rather limits her range.
De Rugy’s goal is to hunt down “fraud and bureaucratic ineffectiveness,” which enables her to place blame both on the people who collect social program payments and those who hand them out. . . .
Farm supports don’t appear on De Rugy’s latest chart, unlike food stamps, school lunches and school breakfasts. It’s good of her to ferret out government waste, fraud, and abuse. But she may be looking in the wrong places.
Here’s the thing: I didn’t single out welfare programs to blame “people who collect social program payments.” Jason Fichtner and I based the chart on the data from the government’s own listing of “high-error programs.” That’s right. The reason why these programs made the government’s list is because they have the highest error rates. That our LA Times friend missed this is strange, since it’s not as if we have been hiding where the data came from. The chart analysis, which I linked to in my NRO post, explains we got the data and links to the government’s website. So if I’m guilty of being a conservative looking to blame “people who collect social program payments” then so is President Obama’s Office of Management and Budget. That, of course, would be an absurd suggestion.
I can only conclude that he let his own preconceptions and biases get in the way of his reporting and wrote this piece without doing sufficient research. Again, his piece seems to imply that I am so eager to blame “people who collect social program payments” that I don’t pay attention to the true outrage, namely cronyism. That’s too bad for him, considering that I have been spending the bulk of my time fighting and writing against cronyism: The Ex-Im Bank, SBA loans, energy subsidies, farm subsidies (the sugar racket in particular), and oil and gas subsidies. Indeed, there isn’t a crony program that I like or support and I wouldn’t support them even if they had improper payment rates of zero. Moreover, each time I get a chance, I tell people how shameful these government handouts to special interests are and how they mostly benefit the wealthy and well-connected.
Here are just a few examples:
GOP to Taxpayers: We’re Against Subsidies, Except If They’re For Rich Farmers; Beyond the Export-Import Bank: This Is the Next Corporate Welfare Program We Should Cut; Crony Capitalists, Place Your Bets on the Wire Act; Congress and Crony Capitalists Want to Take Over the Contact Lens Market; Marco Rubio’s Sweet Protectionism; Retailers Don’t Need Another Regulatory Handout; Farm Subsidies Must Die; The Federal Sugar Racket Should Be Broken Up; Sugar Industry Spends Millions Seeking Government Privileges; Halloween Is Sweet For U.S. Sugar Moguls; Renewable-Energy Subsidies and Electricity Generation; Who Benefits from the Department of Energy’s Loan Guarantee Program?; Double-Dipping Greens Double-Cross Taxpayer Trust; The Constancy of Crony Capitalism.
As you can see, I really don’t like farm subsidies. In fact, take a look at this paragraph from that first piece I linked to, which I wrote in 2013 when Republicans were hypocritically seeking to boost welfare for farmers and reduce spending on food stamps:
To add insult to injury, this move just feeds into the portrait Democrats like to paint of Republican lawmakers: They will support any policies that favor the rich — even if they mean more government spending — and like to oppose policies that would benefit lower-income Americans. In this case, there is some truth to that. Republicans are showing that, while some of them weren’t willing to vote for the farm bill as long as it included food stamps, they will support the outrageous redistribution of income to higher-income Americans when it benefits wealthy farmers.
Everyone makes mistakes – I’ve been guilty of it myself – but my goodness did he get my motivations completely wrong.
Now, I have a question for Mr. Hiltzik. As he notes, the $127 billion figure in the chart and $137 billion figure government-wide is a mix of overpayment, underpayment, and other errors. According to the report, government-wide we have roughly $126 billion in overpayment and $11 billion in underpayment. It is worth noting the report methodology. Following on Kevin Drum’s footsteps, he writes that the “real” improper payment is probably around $50 billion, but who knows really. That’s smaller than $137 billion government-wide and $127 billion over those 16 programs. It is also smaller than the $19 trillion the government’s gross debt. But it’s still very large — there are still nine zeros behind the 50. Shouldn’t that bother him? It sure doesn’t seem like it, based on his comments about the EITC.
And what about underpayments? Since he claims to value these programs because he cares so much about poor people, wouldn’t he be better off writing about what underpayments mean for low-income Americans and how to fix it?
Well, to quote him: “But that’s not her [his] agenda.”
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Addendum: Since I made the chart at the beginning of April, it appears that OMB added another program to the “high-error programs” list. And in a deliciously ironic twist, the addition happens to be the federal crop-insurance program. It’s only $300 million, so it’s curious it even made the list, since high-error programs have improper payments above $750 million. However, given that I believe all farm-subsidy programs should be abolished — including crop insurance — and I think all improper payments are a problem, I will happily update my chart to include it. Thank you, Michael!
Government Overpayments: Responding to the LA Times