Shifting priorities: congressional incentives and the homeland security granting process.

In the wake of the terrorist attacks of September 2001, the federal government has demonstrated an unprecedented commitment to homeland security through a massive reorganization and the creation of a new cabinet-level department as well as through exponentially greater spending on counterterrorist security. The Department of Homeland Security (DHS) has spent $11 billion on emergency preparedness and response from 2001 to 2004. According to the textbook picture of government, federal agencies use budget and personnel increases to take on new tasks in addition to old ones, in this case defending the nation against terrorism while preserving the capacity to respond to natural and technological disasters. (1)

But rather than textbook efficiency, the federal government's response to the threat of terrorism is an example of the triumph of symbolic and distributive policies over more straightforward attempts to address the real problems of homeland security. I show how Congress has funded counterterrorism initiatives without serious risk analysis while reducing its commitment to emergency preparedness and response to natural and technological disasters. Small isolated states receive far more money per capita for homeland security than do large high-risk states, and furthermore within each state money and attention appear to be diverted from more frequent natural disasters toward the terrorist threat. The essential reason for this imbalance is that the incentives for public agencies are different than they are for private firms. Scholars such as Mayhew (1974) and Fiorina (1977) have shown how Congress structures policies to further the reelection ambitions of individual members, resulting in outcomes that may be optimal for an individual member's district but suboptimal for the country as a whole. In practice, Congress often uses spending as wealth transfers--in other words, "pork"--rather than as coherent solutions to policy problems. Faced with these structural limitations, the best strategy for policymakers interested in a coherent approach to emergency management is to make the issue of risk analysis salient to the public in order to bypass the usual veto points while employing risk analysis during funding decisions as much as possible through the use of competitive grants.

The differences between government and private firms provide reasons to suspect that emergency management agencies will not be able to respond to the new mission of homeland security in an "efficient" manner. One meaning of efficiency in government is the lowest cost way for a legislator to achieve desired outcomes, which is usually a maximum of goods for a particular legislator's district (Weingast & Marshall, 1998). Most people, however, think of governmental efficiency as the lowest cost way in which institutions can achieve a general good or resolve a shared problem. In the case of hazard response, the problem is clear: the United States must incorporate the heightened threat of terrorism into its strategy for preparation and response to disasters in general.

Unless agencies develop autonomy, the first step in problem solving will depend upon Congress. (2) It is in federal agencies' relationships with Congress, rather than with consumers in a private market, where the notion of efficiency becomes cloudy. In the words of Wallace Sayre, a student of public administration, "public and private management are fundamentally alike in all unimportant respects" (Allison, 1990, p. 16). Government agencies cannot distribute the benefits of greater earnings to employees in the way that private firms can. Federal bureaucracies are also constrained because they cannot allocate the factors of production in accord with the preferences of agency leaders and they generally lack control over the missions they pursue. Authority over federal agencies rests to a great degree in entities outside the agency--the president, Congress, courts, interest groups, states and localities, and public opinion (Wilson, 1989, pp. 114-136).

These entities have far different motives than the consumers who shape the functions of the private market. While customers of private firms may want the highest quality product available at a low price, agencies cannot easily make efficiency a goal since it is not always clear what their products are. In emergency management policy, the federal government is charged with helping victims of disaster recover while also developing an effective mitigation strategy so that people take actions that reduce their potential losses before disaster occurs. Like many of the goals agencies pursue, these two are potentially in conflict since people who are given assistance with recovery may calculate that it is worth the risk not to change their behavior because they can count on the federal government to cover their losses (Platt & Rubin, 1999). In public management, efficiency is a slippery concept both because of confusion over missions at the agency level and because members of Congress may face conflict between serving their districts and serving the nation as a whole.

In an environment of multiple and contradictory goals, policymakers often fall back on vague rhetoric to unify the public such as "securing the homeland," which obscures the relative costs and benefits involved in such a task. In truth, the United States will never be impervious to attack, but it can be more or less vulnerable. One way in which Congress addressed the terrorist threat was by funding emergency preparedness and response entities at the state and local levels, first through a formula in the Patriot Act and then through subsequent legislation. The result was a distortion in the allocation of funds, both away from high-risk states such as New York and toward low-risk but well represented small states, as well as away from high-probability natural disasters toward the terrorist threat. These shifts in attention and funding demonstrate shortcomings in the decision-making process in government.

The most frequent incentives for congressional spending are the relative costs and benefits of a particular policy as perceived by a legislator's constituents. General costs and benefits are those that fall on citizens equally, such as a feeling of threat or safety from a terrorist attack (Arnold, 1990, pp. 26-27). …