Thursday, August 18, 2011

$300,000,000 - The Standard Unit For Government Waste (SUFGW)?

I was struck by a consistency of waste across four U.S. government entities and programs that I have come across recently. It appears that there may be a secret U.S. government standard waste unit that the government uses to measure how much taxpayer waste that government programs throw away with no benefit. It seems that $300,000,000 or so is that secret measurement of waste:

- An Associated Press (AP) report from September 2, 2006 reported on how the Internal Revenue Service gave away ... $318 million in improper refunds that year because a computer program that had been used for over ten years to screen tax returns for fraud was not working for that year's tax refunds.

The damage was actually worst than $318 million since the year before the program had stopped $412 million in fraudulent returns. Thus, the turnaround from one year to the next due to the incompetence of not having the program working properly was over $700 million ($318 in improper refunds plus the $400 million in fraud that may have been stopped).

This measure of incompetence is really sad. According to the AP report, as of September, 2006 the IRS was still trying to get the program fixed in time for the next year's returns. The IRS spent $20 million to update the program, an update that never got done in time. So the actual cost to the American taxpayer was really closer to the cost of the program update and the amount of improper payments or about $338 million. The IRS commissioner at the time stated that the performance of the IRS was "insufficient and unacceptable." No disagreement here.

- The 2006 $300 million IRS snafu was the first indication that there is a standard $300 million unit of waste in the government's operations. A few weeks ago it was reported that the U.S. Navy had almost completed the construction of two new U.S. Navy fuel tankers. The cost of the tankers was ...$300 million.

However, it took so long for the government to build the tankers that they are now obsolete and will be scrapped, without ever being used, at an additional cost to the American taxpayer of $10 million. Total cost of waste: $310 million.

- In late November, 2010, the St. Petersburg Times printed a Scipps Howard News Service report describing how the IRS fails to prosecute families who wrongfully claim tax benefits for children who are not their legitimate dependents. The estimated annual loss to the taxpayers from this fraud is ...$380 million. The article reported that the fraud involves more than a million tax returns every year so the fraud is widespread.

The very sad part of this story is the IRS has no plans to go after these tax cheats. They do not think that $380 million is a big enough fraud to devote resources to. Why the IRS cannot farm out the fraud, that they have already investigated to some degree, to an outside collection agency and give the agency a bounty for performance is beyond me.

- The latest $300 million coincidence comes from an August 16, 2011 AP news article that reported on how the U.S. military believes that ... $360 million a year is diverted from military support and reconstruction contracts in Afghanistan and ends up in the hands of our country's enemies: the Taliban, criminals, and local power brokers.

This waste and fraud was identified by a special military task force and shows how corrupt the world is inside of Afghanistan and how the Obama strategy of improving the quality of life for Afghanistan's citizens' lives is rife with corruption and fraud. After so many years operating in Afghanistan, the government and political class cannot even keep track of over $300 million a year.

The cost is probably higher than the $360 million if the Taliban is getting their hands on this money. Theoretically, the Taliban could be turning our own taxpayer money into weapons that are in turn used to harm and kill our own troops, a price and cost that cannot be estimated.

So let's review:
  • IRS waste and fraud in reported in September, 2006 - $338 million
  • IRS waste and fraud in reported in November, 2010 - $380 million
  • U.S. Navy waste and fraud reported in August, 2011 - $310 million
  • Afghanistan waste and fraud reported in August, 2011 - $360 million
  • Total waste and fraud in just these four incidents - $1.380 billion
Four disgraces, all worth about $300,000,000 of wasted taxpayer money. How many other times does the political class and the Federal government waste $300 million at one time? A hundred times a year? A thousand times a year? If it is a hundred times a year, than we are wasting over $30 billion a year. A thousand incidents of waste a year at the standard unit for government waste (SUFGW) of $300 million per unit comes out to the taxpayers losing $300 billion a year.

To  paraphrase an old Senator Everett Dirksen quote: "$300 million here, $300 million there and soon you are talking about real money." And that is what the political class does not understand. If the U.S. government had not spent the $1.380 billion above, no needy poor child would have went hungry, no needy Social Security recipient would have not gotten their Social Security check and no ill, elderly American would have not gotten Medicare coverage. But the U.S. taxpayer and the national debt would have been in a little better shape. However, the political class would rather distort this reality to the benefit of their political careers.

There is extensive Federal government waste currently going on today, apparently at $300 million at a time. The political class, the White House, Congress, and every part of the Federal government should be fervently identifying and wiping out this waste. This is obviously not the case as we continue to waste taxpayer money at the standard $300 million clip.

Thus, taxing the rich, implementing new taxes, revoking the Bush tax cuts, etc. needs to all be put on hold until the political class can prove to America that their hard earned wealth will not be lost to corruption in Afghanistan, incompetency at the IRS, sunk by the Navy or flushed away by hundreds of other government entities.

We need to get the SUFGW minimized in value and minimized in frequency. A $300 million SUFGW is not acceptable.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:

No comments: