Monday, June 8, 2015

June, 2015, Part 7, Political Class Insanity: Government Dysfunction from the IRS to The Veterans Administration and Beyond

It is the start of another month which means it is time to review the latest political class insanity that the American political class has dropped on our heads in the past month or so. We do this review every month in order to continually prove our view that we are currently being served by the worst set of politicians in the history of our country. Their inane quotes, their failed programs and laws, their wasteful spending, their ineptness, and continued focus on their own careers and self enrichment at the expense of taxpayers is constant and disgraceful.

This month could be one of the worst ever, given the backlog that needs to be discussed. The insanity will cover a full range of areas where today’s politicians continue to disappoint and fail us. As always, the new ways they find to screw up is never ending and always creative.

Today is the seventh update to the insanity for this month:

1) In late April, the Government Accountability Office (GAO) reported that the Department of Energy’s Loan Guarantee Program will likely cost American taxpayers $2.2 billion over the life of the loans that the Department has given to usually inept alternative energy companies. The GAO also reported that already $807 million of those loans have gone into default.

Much of the money lost on defaulted loans have been associated with five companies: two solar panel manufacturers, Solyndra Inc. and Abound Manufacturing Solar LLC; two green vehicle programs, Fisker Automotive Inc. and the Vehicle Production Group LLC; and one energy storage project, Beacon Power. GAO investigators said "those technology projects were risky from the start, and each had a shaky credit rating.” 

However, to add insult to injury of this terrible program, an alternative energy company accused of filing fraudulent loan applications will receive additional taxpayer funds. According to The Washington Free Beacon, “A green energy company accused by two former employees of filing fraudulent applications for federal grant money will receive additional subsidies to research geothermal energy, the Department of Energy announced on Tuesday. The company, Ormat Geothermal, will help lead a team of researchers in Nevada that will receive a chunk of the $2 million DOE has set aside for geothermal research in five states. DOE will distribute another $29 million for the second phase of the project, according to the Associated Press.”

Unreal. Billions of dollars spent with no societal benefit in return. And still the Washington political class insists on giving away more taxpayer money including giving it to a company that may have committed fraud in a previous round of loan agreements.

2) But it is not just the Department of Energy that can waste a lot of taxpayer money. According to a recent report by the inspector general at the Centers for Medicare & Medicaid Services (CMS), CMS ignored earlier recommendations from a previous inspector general audit that could have reduced Medicare costs by $251 million. According to the latest report:
  • “In updating our analysis, we found that Medicare expenditures for DME infusion drugs could have been reduced by $251 million in an 18-month period if the ASP-based payment methodology recommended by OIG had been implemented in April 2013 (i.e., the quarter after our earlier report was issued).” 
  • According to the inspector general report: “If payment amounts for DME infusion drugs had been based on ASPs rather than decade-old AWPs between the second quarter of 2013 and the third quarter of 2014, total Medicare Part B spending would have decreased by 35 percent (from $712 million to $461 million), a reduction of $251 million.”
  • The report concluded: “Under this methodology, providers are being reimbursed for many drugs at double their costs, while recouping only half of their costs for other drugs.”
As always, the government bureaucracy cannot even save money when shown how to save money.

3) From the previous story we see that even when the Federal government is shown how to save money they blow it. The following story is along the same lines, even when the Federal government focuses on a high profile problem and tries to fix it they still some how blow it. 

A year or so ago it came to light that the Veterans Administration (VA) was doing a horrible job getting medical care, as promised, to the nation's veterans. Vets were dying as a result of the incompetence while high ranking VA officials were getting big, fat raises for their inferior performance. Congress got involved, the President swore that corrective action would be taken, and additional funds were allocated to address the high profile issue.

A year later, the Associated Press (AP) reports that despite the high visibility and the sense of urgency on the issue, nothing has really changed or improved over time. According to the AP’s David B. Caruso:
  • “VA statistics show that the number of patients facing long waits has not declined, even after Congress gave the department an extra $16.3 billion last summer to shorten waits for care.”
  • Almost 900,000 completed medical appointments at various VA medical locations from August, 2014 through February, 2015, failed to meet the VA’s timeliness goal, a goal that requires patients be seen within 30 days.
  • More than 25% of those appointments were not met within 60 days.
  • Despite the urgency of the President and Congress, since last summer, the number of veterans waiting more than 30 or 60 days for non-emergency care has largely stayed flat, i.e. no improvement, but the number of medical appointments that take longer than 90 days to complete has nearly doubled.
This is why we have always asserted that the Federal government has to get much smaller and focus on far fewer activities. This would accomplish two goals. First, it would return hard earned taxpayer wealth back to taxpayers where it would not be wasted. And second, if the Federal govenrment and the Washingotn political class that operates it focused on far fewer activities it might actually succeed in resolving a problem. As it is today, the Federal government does a whole lot of things very poorly, very expensively, and never effectively.

4) Throughout this month’s review of the latest political class insanity, we have been posing the question of which is the most inept government entity. The IRS and TSA seem to be the leading candidates, at least in our recent discussions on political class insanity. The IRS recently admitted that it had sent over 600 tax refund checks to the same address in….Ireland. The TSA has admitted it has lost at least hundreds of TSA security badges, endangering the flying public since those badges could conceivably be used to give terrorists access to secure areas of airports.

But now the Social Security Administration (SSA) has jumped into the fray for being the most inept government organization for at least the past month. In a recent audit by the SSA’s inspector general, the SSA likely and mistakenly paid out hundreds of thousands of dollars in SSA benefits to sexual predators who were involuntarily confined to Special Commitment Centers.

The audit found that 18 different sexual predators in four different Centers had been improperly paid $524,000 in either Social Security benefits or Supplemental Security INcome payments. More disgustingly, the same type of scandal was uncovered three years ago when 14 sexual predators were able to receive more than $500,000 in SSA benefits. In other words, despite being told they were being scammed and how they were being scammed, three years later SSA executives had not fixed the problem.

This is not only a failure of management it is also against the law. Under Federal law, the SSA is supposed to stop payments to “sexually dangerous persons” confined in institutions. According to the audit however, the SSA has no security protocols or processes in place to prevent this type of scam from actually happening.

That will do it for today’s insanity. From the Department of Energy to Medicare to the IRS to the Social Security Administration, we are obviously in the midst of a government wide breakdown in fiscal accountability, management control, and wasteful spending on a scale never seen before. All paid for by the American taxpayer who usually gets not positive return at all for their taxpayer dollars.

And the sad thing is that seven days into this month’s political class insanity, we are not even close to be done with our coverage of it all. More insanity and heartache tomorrow and beyond.

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