[Congressional Record Volume 159, Number 28 (Wednesday, February 27, 2013)]
[Senate]
[Pages S918-S921]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                             Sequestration

  Mr. COBURN. I want to spend a few minutes this afternoon talking 
about what is going to happen on March 1, something we have known is 
going to happen for 18 months. Nobody really wanted it to happen this 
way, but I want to make the case if we give the administration the 
flexibility, we can easily swallow $85 billion a year in reductions.
  I am going to go through a small set of oversight reports I have 
actually done in the last year or so talking

[[Page S919]]

about waste within the Federal Government.
  We looked at the urban area security grants of the Department of 
Homeland Security. We looked at the Department of Defense, the programs 
that were in the Department of Defense which don't have anything to do 
with defense; that is $67 billion a year.
  Let me say that again: $67 billion a year is spent in the Department 
of Defense which has nothing to do with defending the country.
  We outlined the 100 most wasteful projects, we put that out in 
December of this year, a treasure map. We looked at the Market Access 
Program and what it is actually doing to some of the wealthiest 
agricultural businesses in this country. It is subsidizing their export 
of sales. Money for nothing, all of the money that we spent that hadn't 
actually accomplished anything. We did a report on that.
  Next we did a report on the subsidies for the rich and famous because 
we do have a mixed-up Tax Code, and over $30 billion a year in benefits 
goes to a very small number of people in this country inappropriately 
through our tax cuts. The discussion and disagreements we are going to 
have on that will be about what do you do with that. Everybody agrees 
we probably ought to fix that. Do you fix it by just raising taxes or 
do you fix it by reforming the Tax Code and actually getting greater 
taxes coming into the Federal Government?
  The other point I wanted to make is there are a lot of things we may 
sequester that I have been talking about for years, which actually 
haven't gotten any traction, but I suspect right now will be getting 
some traction. The first one is the grant programs in the Department of 
Homeland Security.
  In one area, the Urban Area Security Initiative, which is a component 
of the Homeland Security grants, we spend $170 million a year on one 
grant program. What we did when we looked at it is we found tremendous 
amounts of waste that have nothing to do with increasing the security 
in the communities where this money was spent.
  Let me give you a few examples: domestic drones that have limited 
capability, can't fly over anything that is populated because they are 
not reliable enough. Also, underwater robots, snow cone machines, 
security upgrades for spring baseball training programs and stadiums, 
color printers, BearCat vehicles for communities of 20,000 people who 
will never have a need for that piece of equipment. Yet we spent it 
because the people making those pieces of equipment are so good at 
helping cities get grants whether they need them or not, they apply for 
them.
  Columbus, OH, bought an underwater robot, $98,000. They don't have a 
facility, a true natural lake or other lake in which they could 
actually utilize this piece of equipment, but they bought it anyway.
  Spring training in Arizona, $90,000 to install video surveillance at 
the Peoria Sports Conference Complex. The Seattle Mariners and San 
Diego Padres have their spring training there.
  Here are Urban Area Security Initiative grants which are supposed to 
be spent on security. What we found is a large portion of the money 
across the country is not being spent on security; it is being used to 
augment aspects of what communities need.
  This is a good way to trim $700 million through these grants. While I 
am at it, what we do know is the Department of Homeland Security, 6 
months ago, had $8 billion in unobligated balances. Secretary 
Napolitano made a decision--and her basis was for stimulus, economic 
stimulus--she would take the requirements off of those grants and push 
that money out the door. They were only able to push $3 billion out the 
door, so there is still $5 billion sitting in Homeland Security in 
unobligated money from last year alone that hadn't been spent. This 
addresses many of the issues that we are talking about in terms of the 
sequestration.
  The Department of Defense, in terms of the ``department of 
everything''--let me outline for you a minute. Not all this money could 
be saved because they are doing some things, but they have no business 
being at the Department of Defense, with $67.9 billion over 10 years in 
nondefense spending; nonmilitary research and development, $6 billion a 
year. And education, the average cost to educate a child on base in 
America--not our foreign bases, not where we actually need private 
schools--is over $51,000 per year per student.
  We could consolidate that program, as we do at all but 16 bases, and 
over 10 years save $9 billion.
  There are STEM programs, 103 different STEM--science, technology, 
engineering, and math--programs within the Pentagon alone. 
Consolidating those would save $1.7 billion over the next 10 years. 
These are programs not necessarily initiated by Congress either, I 
might say. They do have the flexibility on a lot of these programs to 
make those changes.
  The Department of Defense tuition assistance program totally 
duplicates our veterans assistance program. So you can do in-service, 
have access to tuition while you are in-service and then have the 
identical access to tuition afterward, and you can claim them both.

  So we have multiple duplications there. And there is nothing wrong 
with wanting to give an educational benefit to our troops, but we don't 
need to do it twice. That is a significant $5.4 billion.
  Alternative energy. We have a Department of Energy. Their whole goal 
is to work on alternative energy and renewable energy and efficiency 
within energy. The Department of Defense is spending $700 million a 
year on research in alternative energy that totally duplicates 
everything we are doing everywhere else. So there is $700 million we 
should not be spending at the Pentagon for something that is already 
being done somewhere else.
  We also know we have a benefit for our military families called the 
PX and commissaries. But when we go out and price products, what we 
find is you can actually buy at retail stores at a lower price than you 
can at the commissary. For the cost of running all those organizations, 
we could give every troop an additional $1,000 a year and save $5 
billion over the next 10 years. We could give them $1,000 more, and 
they would be able to buy at lower prices from a commercial vendor 
versus a commissary.
  Overhead support and supply services. Over 300,000 military members 
are performing civilian-type jobs. In other words, these are Army, 
Marine, Navy, and Air Force personnel trained as warfighters, and we 
have them doing nonmilitary jobs at the Pentagon. We could put civilian 
employment in place and have these military people available to be 
warfighters and save $37 billion over the next 10 years just in the 
differential in what our total costs are for the two different types of 
employees.
  So when we talk about a sequester taking $85 billion, I have just 
cited over $85 billion over 10 years just by looking at a few programs. 
So we hear the number, and we think about the Federal Government being 
twice the size it was 11 years ago and that we are 27 percent higher in 
terms of discretionary spending in nondefense and that even if the 
sequester goes through, as it is now planned for the military, the 
military expenditures will actually still be greater next year than 
what they are this year. So it is important that we talk honestly with 
the American people about where we are on these projects.
  Let me just for a second talk about a report called the ``Waste 
Book.'' We put it out every year. We gave 100 examples of the most 
egregious ways tax dollars were wasted last year.
  Examples include $450,000 for an unused airport in my State and 
$325,000 for robotic squirrels. This was a grant issued to study what 
we already know about robotic squirrels and their interactions with 
rattlesnakes. I can't see that as a priority for us. At a time when we 
are running $1.2 trillion deficits, we don't need to be spending money 
on that type of research.
  We spend $91 million a year giving--you won't believe this one--
charitable status to the NFL, the PGA, and several other sports 
entities. So on the profits they make, the PGA defers taxes coming to 
the Federal Government in terms of $91 million a year. Now, I don't 
know of a pro sports team that isn't in the business of being 
profitable, yet the organizations they send a lot of this money through 
we are allowing to hide that money through the Tax Code. That is $91 
million a year. Why are we doing that?
  Another example: $27 million was spent by the State Department on 
pottery classes in Morocco. The whole

[[Page S920]]

project was an abject failure, but the real question is, Why are we 
spending $27 million on pottery classes in Morocco? Could we spend $27 
million and have a better effect for the Moroccan people than a failed 
pottery class program? The answer is, certainly.
  The size of the State Department is twice the size it was 5 years 
ago--twice the size in terms of total expenditures.
  The other thing we talked about is the subsidy for the rich and 
famous in terms of what is out there. On average, we found $30 billion 
a year that millionaires--people who make at least $1 million a year--
enjoy in benefits from tax giveaways and Federal grant programs. That 
is $30 billion a year. That is $300 billion. That is over one-third of 
what we are talking about on the sequestration. Yet we have done 
nothing on that.
  This has been out for a year, by the way. Here are some more 
examples. We have $74 million spent on unemployment checks that went to 
millionaires last year. That is right, $74 million went out to people 
who made $1 million, but we still paid them unemployment. We spent $316 
million on people who are making more than $1 million a year farming. 
We sent them $316 million worth of subsidies and $89 million for 
preservation of their ranches and their estates. These are people 
making an adjusted gross income above $1 million a year. We sent them 
$9 billion in retirement checks, we sent them $75.6 million in energy 
tax credits for their homes, we sent them $7.5 million for costs and 
damages due to emergencies, and we also gave them a writeoff on their 
gambling losses in excess of $3 billion.
  The other thing I found very unusual as we looked at this is that 
people making an adjusted gross income in excess of $1 million were 
given $16 million in government-backed education loans. That is right, 
$16 million in government-backed education loans.
  One of the other areas we did a study on was the Market Access 
Program. We have all heard of Sunkist and Welch's and Blue Diamond. In 
2012 we paid them $6 million from the taxpayers to help them sell their 
products overseas. These are hundred-million-dollar corporations, 
minimally. They are billion-dollar corporations. We don't do that for 
the rest of all the corporations in this country, but because they 
happen to be associated with an agriculture program, we decided to 
subsidize the overseas products of the very well-to-do corporations. 
That may be a laudable goal, but at a time of tight priorities, it is 
not a laudable goal. Over $2 billion has been spent on this program, 
which has indirectly subsidized their advertising costs. So $2 billion 
has gone to very profitable agricultural companies that, if we were to 
look at their 10-Ks, their SEC reports, they are doing just fine. They 
don't need the Federal taxpayer to do this.
  The California wine industry, which had domestic sales of $18 billion 
in 2009--it is higher than that now--got $7 million, and the American 
cotton industry received $20 million and received another $4.7 million 
from a separate USDA market access program.
  Finally, I wish to talk for a minute about more than $70 billion in 
Federal funds that has been left unspent years after it has been 
appropriated. We have $70 billion sitting out there in accounts that 
has been obligated but not spent, now older than 5 years old, which 
means it is never going to be spent. So that money is sitting in a bank 
account somewhere that we could pull back, if we had effective 
management, because people didn't use the money in a grant, they didn't 
use the money in a program, and yet we have failed to do that. So we 
are borrowing an extra $70 billion every year to fund the government 
when we have $70 billion out there in accounts that should revert back 
to the Treasury.
  At the end of this year the Federal Government had $2 trillion in 
unexpended funds. This is according to OMB, not the Congressional 
Budget Office. The Office of Management and Budget says that two-thirds 
of this money was obligated, but a third of it wasn't obligated. So you 
have $650 billion in unobligated balances sitting in the Federal 
Government accounts that we are not shuffling around to direct to the 
things that are most important.
  Let me finish, but first I would like to make one other point. I got 
a letter this week from the mayor of a medium-sized town in my State. 
It is from the mayor of McAlester, OK. I am going to enter this letter 
into the Record because in this letter we see a demonstration of the 
kind of leadership that is needed when there is a financial problem in 
front of you.
  Let me read this.

       The City of McAlester is currently working hard to 
     rebalance our budget after a sudden downturn in our revenues 
     over the past two months. As you know, municipalities in 
     Oklahoma are required by statute to maintain a balanced 
     budget.

  In other words, it is a law in Oklahoma that you have to have a 
balanced budget. So what has he done?
  Continuing to read:

       The first step we took was to implement a hiring freeze.

  So they reassigned workers. And with a revenue shortfall projected at 
$1.2 million, they took every other expense account category, including 
supplies, repairs and maintenance, fuel, utilities, travel and 
training, consulting services and legal services, and reduced their 
budgets. In other words, they responded.
  The mayor continued in his letter:

       None of these cuts are without pain. But all will be 
     accomplished while maintaining essential city services.

  Now, for McAlester, a $1.2 million budget cut is a bigger hit than we 
are talking about with sequestration. If the mayor of a community of 
25,000 people can make the adjustments to serve his constituency 
without decreasing services, why can't we?
  Mr. President, I ask unanimous consent to have printed in the Record 
the letter to which I just referred.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                                McAlester, OK,

                                                February 26, 2013.
     Hon. Tom Coburn, M.D.,
     Russell Senate Office Building,
     U.S. Senate, Washington, DC.
       Dear Dr. Coburn: The City of McAlester is currently working 
     hard to rebalance our budget after a sudden downturn in our 
     revenues over the past two months. As you know, 
     municipalities in Oklahoma are required by statute to 
     maintain a balanced budget. With sales tax receipts abruptly 
     falling by ten percent compared to the prior year, we have 
     had to act quickly to reduce costs.
       The first step we took was to implement an immediate hiring 
     freeze. The budgeted positions that are currently open 
     include two street maintenance workers, a full-time and a 
     part-time administrative assistant, a water plant operator, a 
     police officer, an animal control officer, a firefighter, an 
     accounting manager, a meter reader and a planning director. 
     We will reallocate work among other employees wherever we 
     can. If we determine that an unfilled position will affect 
     the safe operation of the community, only then will the 
     position be filled.
       With a revenue shortfall projected at $1.2 million, we are 
     also making budget reductions In virtually every other 
     expense category including supplies, repairs and maintenance, 
     fuel, utilities, travel and training, consulting services, 
     legal services, etc. Of course, we have also zeroed out any 
     contingency amounts we had included in the budget for the 
     unexpected. However, we have been careful to retain budget 
     items for long-term infrastructure projects as we consider it 
     unwise to risk damaging our city's future.
       None of these cuts are without pain. But all will be 
     accomplished while maintaining essential city services. By 
     reducing our spending in these areas, we anticipate we can 
     finish the fiscal year without having to dip into emergency 
     fund balances.
       Prompted by what we see as an economic situation likely to 
     continue into the next fiscal year and potentially beyond, we 
     are also taking this opportunity to thoroughly review our 
     local government cost structure. The goal is to organize in a 
     way that is more efficient and more effective. By stretching 
     each revenue dollar to the max and by prioritizing our needs 
     and wants, we hope to narrow or eliminate the gap between 
     what citizens expect from their government and what they are 
     willing and able to pay for.
           Best regards,
                                                   Steve Harrison,
                                         Mayor, City of McAlester.

  Mr. COBURN. The final point I would make is the following: A little 
more than 3 years ago we passed an amendment that I offered that forced 
the Government Accountability Office--the government's accounting 
office--and the Comptroller General to identify every program in the 
Federal Government, and not only to identify it but to outline where we 
have duplications and overlaps. And they have done a wonderful job. We 
are going to get the last third of that report about a month from 
today, April 1, but what do we know so far? We know we have

[[Page S921]]

about $370 billion in the first two-thirds of this where they say there 
is massive duplication. There is $370 billion worth of expenditures a 
year.
  I have talked with the President, and he disagrees with me on this, 
but when you think about it, we have 47 separate job training programs, 
of which all but three overlap. They are highly ineffective in total. 
So why don't we have two or three? We spend almost $19 billion on those 
programs. We could spend $9 billion, cut it down to three programs, put 
metrics on it, and make sure it is working. The reason I know it is not 
working is I looked at every job training program in my own State, and 
the ones that are most successful are the ones that are totally State 
run without any Federal Government interference. The ones that are 
federally run--and some are good, I will give you that, but most are 
not--most are not successful in efficiently and effectively giving 
somebody a life skill and getting them into employment.
  We have 253 different, duplicative Department of Justice grant 
programs spending $2 billion a year. If you are needing a grant, you 
might apply to DOJ in one of these 253 areas and then you might apply 
again over here in another area for the same thing. And the fact is 
that the Government Accounting Office says: We don't know if people are 
double- and triple-dipping. As a matter of fact, what did we find? We 
have people getting the same amount of money from different grant 
programs from the same grant application. So what we have is a 
tremendous problem.
  We just discovered in the State of Oklahoma that we have a housing 
administrator for a city that has no houses. There are 3,700 housing 
administrators in the United States--probably closer to 4,000 because 
we are still counting. Some of those have very big responsibilities. I 
don't mean to diminish them at all. But couldn't we consolidate those, 
especially in areas such as rural Oklahoma and the other rural States 
so we spread that overhead and have fewer housing administrators?
  We have 56 financial literacy programs. Think about that for a 
minute, 56 different programs for the Federal Government to create a 
program to make you financially literate.
  First of all, there is a problem with that because we are not 
financially literate, borrowing $1.2 trillion a year. No. 2, we don't 
know what the words efficiency and effectiveness mean in the Federal 
Government--or, at least, have limited knowledge of that. And, finally, 
why do we have that many financial literacy programs? There is no sane 
answer to that question.
  As I outlined in some of the others, 160 housing assistance programs, 
$170 million a year. We have 53 programs across 4 agencies to help 
entrepreneurs. The Federal Government is helping entrepreneurs? Our 
entrepreneurial spirit is not very active and not very successful in 
terms of what we are doing within the government, and yet we spend $2.6 
billion on it.
  We have 15 different separate unmanned aerial aircraft programs 
within the Federal Government. We are going to spend $37 billion on 
that. Why do we have 15? Maybe two or three, because we have different 
requirements, but 15?
  So we have the massive amount of duplication that is going on within 
the Federal Government which implies massive amounts of duplicative 
administrative and overhead costs. I would bet that one-third of what 
is happening in the sequester, if you consolidated programs--didn't 
eliminate any, just consolidated the management--you could save one-
third of what the sequester is just from the administrative overhead 
associated with those.
  So when you hear discussions about we shouldn't be doing the 
sequester, that the sequester is going to be painful--and it is; I 
don't deny that. But it doesn't have to be. All it takes is a small 
drop of common sense, both in Congress and the executive branch, to 
work our way through these problems.
  My hope is the President will work with us on giving him flexibility 
in terms of managing this.
  Remember, $85 billion really isn't 85. It is only going to be about 
44. That is what we are talking about. It is disproportionately heavy 
on the defense. I have a lot of colleagues on my side who disagree with 
me on the waste that is in the Pentagon, but I have seen it, I have 
looked at it, and I have had a lot of people inside the military call 
and talk to me about the waste that is there. We now have an admiral 
for every ship we have in the Navy. Nobody else has that anywhere else 
in the world, and with that comes an average of 200 other employees per 
admiral.
  The question is, Can we do this? Should we do it? And can we do it in 
a way that is best for the American people? We are going to cut this 
money one way or the other. It is not because a Republican wants to cut 
it or because the President wants to cut it or because a Democrat wants 
to cut it. We are going to cut it because the math in our future is 
going to force us to cut it. I know people don't think discretionary 
programs are much of the problem with what we are spending money on, 
but I would surmise that well over 15 percent of everything we do in 
discretionary spending--including the Pentagon--is not effective or 
efficient.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER (Mr. Blumenthal). The Senator from West 
Virginia.
  Mr. MANCHIN. Mr. President, I ask permission to speak as in morning 
business.
  The PRESIDING OFFICER. Without objection, it is so ordered.