I’m sure it can be frustrating to try to follow the rules in that environment when everyone around you seems to be getting their purchases through the system and you’re constantly being told there isn’t any money. I can imagine it would create a culture that demands lack of ethics to get anything accomplished.
I worked for the DOE for 12 years. There certainly were shady, sweetheart, and down right suspicious deals that happen for services, hardware and software.
I'm filing this one under "Don't believe everything you read on the internet" until more evidence surfaces. The number is just too fantastic. That's the about the same size as our national debt, making it very hard to believe a number that large is possible.
With respect to the article it is over a 17 year period. According the the U.S CBO annual spending is around $4 trillion. I'm personally not surprised by these numbers.
At the start of his tenure, Rumsfeld said that the DoD couldn't account for about $2T dollars, so regardless of whether $21T seems plausible, this (first ever!) audit is long overdue.
Those two trillion dollars Pentagon could not account for where for just one year or a longer period? I remember that. It happened right before 9/11 so it was forgotten after the terrorist attack but Rumsfeld went on record saying all that money was missing. Could it be corruption in military is so widespread that we talk about trillions of dollars being siphoned away?
In addition to what the person above stated about the period of time over which this occurred, I'd like to add that I would think the "don't believe everything you read on the internet" file would be filled with statements of the kind made by disreputable sources. This article concerns research done since at least 2015 which has led to an investigation from the Department of Defense. I don't think it should be taken so lightly, yet your comment seems to be trying to sweep this issue under the rug.
I don't see the reference to the money as "missing". My read is that it's the total of ledger entries made without sufficient supporting justification.
It could be a tank squadron on the books that wasn't removed when it got destroyed (or dismantled) or a whole military base decommissioned but still being depreciated.
This isn't (necessarily) "the Army spent 6.5 trillion too much in one year" nor is it "the Army lost 6.5 trillion".
A single dollar mistakenly accounted upfront can sometimes require at least twice that in corrective ledger entries.
Finally, consider a mistake of the type of over-estimating the value of a capital item by an order of magnitude. The corrective ledger entry would make it look like a huge loss was incurred in a particular year when the reality was much more benign. For the purposes of this report, that corrective entry needs to be supported by specific explanation which was missing.
The $X trillion missing from Pentagon funds is a meme that pops up every few years (new "journalists" discovering the same news and trying to fill their click quota?).
The money is not missing, just not tracked up to expected accounting standards
Maybe the reports don't say what they claim (I'm no accountant), but if they do, the only other possibility I see is outright fabrication of official documents (with signatures!) by people who aren't exactly anonymous loonies.
In my reading of the document, the use of 'adjustment' does not mean that the underlying spending occurred in a single year only that the correction did. So the error could have accumulated over many years.
It might also be write-downs on assets that should have been taken over decades and weren't.
I'd love an actual accountants' (or anyone else's) take on things, but that explains at least how both the total budget number and the adjustment number can both be correct.
I would bet accountants still would have a hard time understanding the underlying spending distributions. U.S. spending is a quagmire of illogical and incomprehensible allocations of money. There is so much shoved around for budget purposes to allocate towards government projects that it might never be known what is true spending .
Former military finance officer here. I never worked directly w/ the budget shop, but in training they taught us that 'adjustment' was essentially shorthand for 'we can't make these numbers add up.'
Ie,adjustments were less surgically applied line-item corrections, and more bandaids to fix what could easily be underlying math errors.
So if a unit budget was $10mil one year, and could only account for $9mil, they might make $1mil in adjustments to avoid coming in under budget (a kiss of death, as your next year's budget would be cut by however short you were).
There are many layers of bureaucracy, and every dollar unaccounted for in every layer counts towards the total. The headline number is much bigger than the number of actual tax dollars spent, but the larger number is indicative of the bogus bookkeeping done throughout gov't agencies: 21 trillion in accumulated errors.
The media don't report much "general" incompetence. If there's a link that this was done as cover for malfeasance or graft then it would be newsworthy.
As it is, it's an eye-glazingly complicated story about government accounting regardless of how big the numbers are. It's hard to imagine the number of hours necessary to fact check the article not to mention finding experts in the field to break it all down.
Oh come on. A publication like the Economist lives for stuff like this, as a story of this magnitude would have lots of knock on effects.
Daily press does tend to go after blow-by-blow stuff but you're selling the media short. The entire Trump collusion thread right now is itself crazy complicated and it's in the news daily.
Where would a government department get this much actual money? Do they just have unlimited debit accounts? At some point someone in the treasury has to transfer the money and notice it’s above the budget right?
It's entirely possible that this spending is within their budgets.
The article talks about unauthorized spending not that they had extra money or did over budget spending. So a lot of it could depend on how one defines unauthorized spending.
It actually does say that the Army spent over their budget:
Skidmore got involved last spring when he heard Catherine Austin Fitts, former assistant secretary of Housing and Urban Development, refer to a report which indicated the Army had $6.5 trillion in unsupported adjustments, or spending, in fiscal 2015. Given the Army’s $122 billion budget, that meant unsupported adjustments were 54 times spending authorized by Congress.
US budget for 2015 was 3.688 trillion USD[0]. There are many things that are possible, but US army spending nearly double of the entire US budget without anyone noticing isn't one of them.
The entire 2015 federal budget was around $3.9 trillion. If just the army had spent $5.6 trillion in 2015 that would be noticed. This article can't make extraordinary claims with extraordinary proof (or any proof) to back it up.
The number sounds ridiculously large but I'm not surprised that these things happen.
The entire financial system is built on fraud. I think that most people understand this at least subconsciously.
Many years ago, being honest and forthcoming was beneficial and people appreciated honesty.
If you made a mistake and were honest about it as soon as it came to your awareness, people would respect you for it and would be more lenient. These days this is not the case, being honest is actually a disadvantage. Lying and cheating is always the best option. People don't give a crap about honesty anymore, only money and social status.
So in a world where the value of honesty is a negative number, it's not surprising at all that fraud is rampant.
It is not clear from the article that this is mostly fraud. It appears that it might cover anything not done strictly according to procedure or documented incorrectly.
And 'not done strictly according to procedure' may or may not be a serious issue in any given case. Most bureaucracies have some rules that are incomplete, contradictory or simply infeasible.
Audits are a good idea, but I don't expect the $21T figure to stand, except perhaps in a purely formal way.
> Now, the Department of Defense has announced it will conduct the first department-wide, independent financial audit in its history
I recall a few (somewhere between 5 and 10) years ago they tried to do an audit and just threw their arms up in the air and said "impossible".
A bunch of people are going to choke on their morning coffee over this but I'm just going to say it: Trump promised to bring accountability to government and here's the DoD performing the impossible. I know, heresy...
Just so you know, this (the audit) was initiated under the Obama administration back on 2010. All Federal agencies were required to go through an audit but the DOD got a waiver for 7 years, which is why you are seeing this now.
No, but the report is about journal voucher adjustments which isn't spending exactly spending.
The report says not that they're "spending" $21T, but that they made a cumulative amount of errors and corrections in their vouchers equalling $21T and have really poor audit controls.
While bad audit controls is a legitimate and serious problem, it very much is not the same as what people normally think of as "Spending".
But these are adjustments that are larger than the entire (associated) budget. How is even possible? How do poor controls lead to these astronomical errors?
I’m constantly amazed with the mental gymnastics people who advocate for tax increases partake in. The know the government is abysmal with money, yet think by giving it a blank check that magically all societal ills will be solved.
The problem is that the mental gymnastics of both sides are so full of holes they are absurd.
The left - we're just going to force everything to be correct and just, including of course, and most importantly, who has money for what. Needless to say, historical societies went quite far in this, and to say it didn't happen is an understatement.
The right - just give more money to people who already have it, and clearly hoard it (that's what lowering taxes does), and they will make everything just and correct. Needless to say, historically this has been done and to say things did not in fact become fair and just is an incredible understatement.
Would having traceable money in a distributed ledger help us keep track of money collected from taxpayers?
Obviously, the volatility of most cryptocurrencies would be disadvantageous for purposes of transferring and accounting for government spending. Isn't there a way to peg a cryptocurrency to the USD; even with Quantitative Easing? How is Quantitative Easing different from just deciding to print trillions more 'coins' in order to counter debt or inflation or deflation; why is the government in debt at all?
Say I have $100 in my Social Security Fund (in very non-aggressive investments which need to meet or exceed inflation) and the total supply of money (including paper notes and numbers in debit and credit columns of various public and private databases) the total supply of money is $1T with $1T in debt; if 1T is printed to pay for that debt, is my $100 in retirement savings then worth $50? Or is it more complex than that?
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[ 3.0 ms ] story [ 122 ms ] threadhttps://www.cbo.gov/publication/52408
Roughly speaking that's like 8.8% of the GDP of the planet. That... just doesn't make sense.
Or approximately 1/3 of the of the entire us GDP, compared to the 3% listed.
It could be a tank squadron on the books that wasn't removed when it got destroyed (or dismantled) or a whole military base decommissioned but still being depreciated.
This isn't (necessarily) "the Army spent 6.5 trillion too much in one year" nor is it "the Army lost 6.5 trillion".
A single dollar mistakenly accounted upfront can sometimes require at least twice that in corrective ledger entries.
Finally, consider a mistake of the type of over-estimating the value of a capital item by an order of magnitude. The corrective ledger entry would make it look like a huge loss was incurred in a particular year when the reality was much more benign. For the purposes of this report, that corrective entry needs to be supported by specific explanation which was missing.
The money is not missing, just not tracked up to expected accounting standards
Article from 2013: https://www.reuters.com/article/us-usa-pentagon-waste-specia...
Article from 2002: https://www.cbsnews.com/news/the-war-on-waste/
And you can Google [missing trillions] to find an article on the topic from any given year.
Maybe the reports don't say what they claim (I'm no accountant), but if they do, the only other possibility I see is outright fabrication of official documents (with signatures!) by people who aren't exactly anonymous loonies.
https://missingmoney.solari.com/dod-and-hud-missing-money-su...
It might also be write-downs on assets that should have been taken over decades and weren't.
I'd love an actual accountants' (or anyone else's) take on things, but that explains at least how both the total budget number and the adjustment number can both be correct.
Ie,adjustments were less surgically applied line-item corrections, and more bandaids to fix what could easily be underlying math errors.
So if a unit budget was $10mil one year, and could only account for $9mil, they might make $1mil in adjustments to avoid coming in under budget (a kiss of death, as your next year's budget would be cut by however short you were).
Lots of this kind of accounting was made public last yr in the army, so this isn't a total shock:https://www.reuters.com/article/us-usa-audit-army/u-s-army-f...
As it is, it's an eye-glazingly complicated story about government accounting regardless of how big the numbers are. It's hard to imagine the number of hours necessary to fact check the article not to mention finding experts in the field to break it all down.
Daily press does tend to go after blow-by-blow stuff but you're selling the media short. The entire Trump collusion thread right now is itself crazy complicated and it's in the news daily.
The article talks about unauthorized spending not that they had extra money or did over budget spending. So a lot of it could depend on how one defines unauthorized spending.
Skidmore got involved last spring when he heard Catherine Austin Fitts, former assistant secretary of Housing and Urban Development, refer to a report which indicated the Army had $6.5 trillion in unsupported adjustments, or spending, in fiscal 2015. Given the Army’s $122 billion budget, that meant unsupported adjustments were 54 times spending authorized by Congress.
[0] https://en.wikipedia.org/wiki/2015_United_States_federal_bud...
The entire financial system is built on fraud. I think that most people understand this at least subconsciously.
Many years ago, being honest and forthcoming was beneficial and people appreciated honesty.
If you made a mistake and were honest about it as soon as it came to your awareness, people would respect you for it and would be more lenient. These days this is not the case, being honest is actually a disadvantage. Lying and cheating is always the best option. People don't give a crap about honesty anymore, only money and social status.
So in a world where the value of honesty is a negative number, it's not surprising at all that fraud is rampant.
And 'not done strictly according to procedure' may or may not be a serious issue in any given case. Most bureaucracies have some rules that are incomplete, contradictory or simply infeasible.
Audits are a good idea, but I don't expect the $21T figure to stand, except perhaps in a purely formal way.
I recall a few (somewhere between 5 and 10) years ago they tried to do an audit and just threw their arms up in the air and said "impossible".
A bunch of people are going to choke on their morning coffee over this but I'm just going to say it: Trump promised to bring accountability to government and here's the DoD performing the impossible. I know, heresy...
While it's still a complete shit show. There's a huge, almost click bate difference.
The report says not that they're "spending" $21T, but that they made a cumulative amount of errors and corrections in their vouchers equalling $21T and have really poor audit controls.
While bad audit controls is a legitimate and serious problem, it very much is not the same as what people normally think of as "Spending".
see: https://www.youtube.com/watch?v=XWuAct1BxHU
The left - we're just going to force everything to be correct and just, including of course, and most importantly, who has money for what. Needless to say, historical societies went quite far in this, and to say it didn't happen is an understatement.
The right - just give more money to people who already have it, and clearly hoard it (that's what lowering taxes does), and they will make everything just and correct. Needless to say, historically this has been done and to say things did not in fact become fair and just is an incredible understatement.
Neither works. Obviously.
Federal debt (2017): $20T
$ 20,000,000,000,000 USD
We already now have https://usaspending.gov ( https://beta.usaspending.gov ) and expenditure line item metadata.
Would having traceable money in a distributed ledger help us keep track of money collected from taxpayers?
Obviously, the volatility of most cryptocurrencies would be disadvantageous for purposes of transferring and accounting for government spending. Isn't there a way to peg a cryptocurrency to the USD; even with Quantitative Easing? How is Quantitative Easing different from just deciding to print trillions more 'coins' in order to counter debt or inflation or deflation; why is the government in debt at all?
https://en.wikipedia.org/wiki/Quantitative_easing
Say I have $100 in my Social Security Fund (in very non-aggressive investments which need to meet or exceed inflation) and the total supply of money (including paper notes and numbers in debit and credit columns of various public and private databases) the total supply of money is $1T with $1T in debt; if 1T is printed to pay for that debt, is my $100 in retirement savings then worth $50? Or is it more complex than that?