The Cesspool Of Federal Government Waste Continues To Bubble Up

This week is turning into a themed set of posts that easily could have been named, "How Many Different Ways Can The American Political Class Waste Money and Resources." Yesterday we focused on the state and local government level where we learned that Illinois politicians were overly involved in the drain cleaner industry, an Ohio state senator was certainly overly involved with that state's sexual intercourse, impotence, and Viagra triumvirate, and New Jersey politicians were unable to order toilet paper for a while. All of these efforts either wasted taxpayer money, increased taxpayer hassles via increased government bureaucracy, or both.

Earlier this week we reviewed the latest news of wasteful spending from the Federal government and the politicians that operate that monstrosity. It appears that employees of the General Services Administration (GSA) had lavishly overspent on a Las Vega conference early in the tenure of the Obama administration: the GSA conference was held at a high end Las Vegas facility, it cost well over $800,000 of taxpayer money which was significantly higher than any other previous GSA conferences, it involved numerous expensive giveaways for the attendees, it involved six, count them six, "scouting trips" to Las Vegas by the GSA conference organizers, and included many skits and references related to how the GSA and its employees were constantly wasting taxpayer money.

This situation has led to the firing of the head of the GSA, the firing of many other GSA higher management members, and other GSA employees being placed on administrative leave. Congress, both the House and the Senate, are now scheduling hearings into the entire affair. One question that should be asked is whether the American taxpayer got back at least $800,000 worth of value for this expense (but I think we all know the answer to that question, no).

But Las Vegas is just the beginning. News reports are starting to bubble up all over the government bureaucracy, this apparently is not an isolated screw up:

- Let's begin with another GSA disaster. According to government reports and the news reports that followed:

• The House Transportation and Infrastructure Committee investigators have announced that FIVE GSA employees went to Hawaii for up to a week in 2011 to attend a single. one hour-long ribbon cutting on space leased by the GSA and Federal government for the FBI.
• The details of the ceremony and travel first appeared in a transcript of an interview between the GSA Inspector General’s Office and a GSA employee.
• The employee testified to the inspector general that this trip was not isolated and that there was another, longer junket scheduled for Hawaii this fall.
• That one would be in Hilo, Hawaii for 10 days and would include only THREE ribbon cuttings, apparently spread out over ten days, for a Federal building, a post office and perhaps a courthouse.

Some pretty simple, obvious questions:

1. Why did five GSA people have to go all the way to Hawaii to cut one ribbon?
2. Why did they have to stay 10 days?
3. Was the trip for any of the five really necessary?
4. How much did it cost to send five for 10 days?
5. Did the American taxpayer get back at least the value of the trip's expenses? If not, than the expense was not worthwhile.

Simple questions for most of us to understand but obviously not simple enough for the management that approved such waste to understand.

- Another part of the same inspector general transcript revealed the accusation that the GSA (and the American taxpayer) paid to relocate ONE employee from Denver, Colorado to a post in Hawaii at a relocation cost of $330,000. Which raises the obvious question: was this one person so valuable and their talent so rare that a Hawaiian native could not be found already in Hawaii to do the same job without the incurring of a $330,000 expense?

- Oh, we are just getting warmed up. It appears that the Justice Department is not immune to wasteful spending either. Recent news reports, including one from Bloomberg, reported that the Justice Department hosted a drug enforcement conference in Istanbul, Turkey in 2008 for 368 attendees at a taxpayer cost of $1.18 million. This comes out to about $1,100 per day per attendee.

From the news reports it is difficult to discern whether this expense included every expense and cost, including travel, or this was just the cost of the actual conference. You get the impression from the news reports that the $1.18 million was just the expense of the actual conference. Thus, the $1,100 per person per day is just an obscene minimum, the actual, total cost might be quite higher.

This raises similar questions to the $800,000 cost of the GSA Las Vegas party: was this conference really necessary, was it really necessary to send hundreds of people to it, could it have been more efficiently handled instead via telecommunications for most people to minimize expense, and most importantly, did the American taxpayer get $1.18 million worth of value back for the conference? If not, then it was a waste of money.

- To show you how tangled and surreal the Federal government has become, consider the case of current Missouri Congressman Emanual Cleaver. Mr. Cleaver is not only the chairman of the Congressional Black Caucus, Mr. Cleaver is also facing a lawsuit for failing to pay down a 2002 Bank of America loan that he used to buy a car wash business in Missouri. Apparently, the business did not go as expected and the Congressman is on the hook for the $1.5 million he owes the Bank.

However, according to the Kansas City Star, the Small Business Administration (SBA) backed about three-quarters of Cleaver's 2002 loan. This means that if the loan goes bad, the SBA, and the American taxpayer, would be liable to pay off about $1.1 million of that debt. According to a report from "The Hill," the Congressman has had trouble making payments from the start of the loan period, having repaid only $150,000 of the original $1.35 million loan. However, due to accumulated interest, penalties, and late fees, the Congressman now owes $1.5 million, more than what the original loan was worth.

Did I mention that Mr. Cleaver is a sitting member of Congress AND the chairman of the Congressional Black Caucus, two very prestigious positions? How embarrassing and costly this is going to be for the nation. The Federal government has gotten so big and so unwieldy that a Congressman who earns over $170,00 a year (which puts him well within the top 5% of all income earners in the country) will likely have a defaulted loan worth about $1.5 million because of his business incompetence, but will have most of the loan paid off by the American taxpayers, the vast, vast majority of which make nowhere close to $170,000 a year. So ironic, so wasteful.

If you read all of the above news reports from various sources, the really scary, but not surprising, common thread is that these instances of gross and obscene taxpayer wealth waste are "just the tip of the iceberg." In fact, many reports are using those exact words. Thus, as the Congressional hearings get revved up, it is likely that we are going to see all types of  insulting and wasteful spending instances across many Federal entities.

Three steps from "Love My Country, Loathe My Government" would go a long way to resolving these issues:

- Step 1 would reduce Federal spending by 10% a year for five years to not only help balance the budget but also wring out these types of wasteful spending. If you squeeze the budgets of these entities, you would probably be surprised how many bad investments would be stopped.

Until that type of draconian spending reduction plan is put in place, government functions will spend all of their budgets every year for fear that their budgets would be reduced the following year. This fear is eliminated if they know that their next year budget will actually be reduced by 10%.

- Step 46 would impose the same rigid Sarbanes-Oxley accounting practices, that businesses have to adhere to, onto all Federal agencies and departments. If it is necessary for businesses to have detailed and accountable financial statements and tracking, it should also be proper and necessary for the Federal government and all of its major subsidiaries to adhere to the same law and criteria.

- Step 34 would hold Congressional committees responsible for wasteful spending and accountable for wasteful spending, removing committee members from those posts when the accountability is not fulfilled. For example, if Step 34 was in effect, those Congressional committee members who were on the GSA oversight committee when the Las Vegas conference was held, would now be removed from those posts for failing to foresee and derail the wasteful spending in Las Vegas and elsewhere within the GSA. Step 34 suggests several approaches to decide when a committee needs to be destaffed for incompetence.

Cesspool has several different but related definitions:

1) An underground container for the storage of liquid waste and sewage.
2) A disgusting or corrupt place.

Quite appropriate if you change liquid waste to political waste or taxpayer waste. And  certainly a disgusting and corrupt waste of taxpayer trust in our government institutions and political class.


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