Great Moments in Government Waste, Fraud and Abuse
March 20, 2017
Senior Fellow Pamela Villarreal writes at NCPA's Taxes and Retirement blog:
Donald Trump's proposed "skinny budget" was released last week. Of course, the outrage and howls of indignation have begun. Already, there are Twitter hashtags referencing cuts to programs for the poor (#Mealsonwheels is trending) and "hair on fire" claims that people and puppies will die because of EPA cuts, education cuts, public television cuts, and of course, the expansion of the "military industrial complex."
In the era of Trump resistance, there is no such thing as a measured response or a little bit of contemplation. Every reaction must be emotional, outlandish and knee-jerk with no fact checking involved. But it's time to take a breather. Regardless of the reactions of anti-Trumpers or Trump supporters, there are some things about politics and policy that remain a constant: government still wastes lots of money. And any budget policy that might force agencies to control waste, clamp down on fraud or follow internal controls make government employees a little nervous. After all, such measures smack of accountability and upend the status quo, meaning that some federal employees may be ushered out the door.
Let\'s take a look at some of the goings in a couple of agencies that Trump proposes cutting the most:
Trump proposes cutting the EPA budget about 31 percent.
- According to the EPA's Office of Inspector General (OIG), the employee credit card and convenience check system is rife with abuse. In 2014, the OIG found that out a sample of $152,602 in transactions, over half of the amount was for "prohibited, improper and erroneous" purchases.
- On February 14, 2017, the OIG determined that the program's risk was high enough to warrant an audit. A review of 18 transactions found that none of them complied with the agency's 14 internal controls. They also pointed out that "two of the 18 transactions, totaling $14,985, were for fitness memberships improperly paid for in advance."
- The OIG also found that EPA's $10 million "transit subsidy" program for employees for parking or public transportation is vulnerable to abuse, as employees use their transit cards after they have quit the agency.
- In another area, EPA often fails to account for grant money awarded to states and localities for pollution cleanup, and the EPA's lack of oversight allows groups to spend the money without completing required grant work. Clean water state revolving funds are not continuously reviewed, resulting in hundreds of millions of dollars in "misuse."
Trump proposes cutting the State Department budget by nearly 29 percent. It could use a good haircut:.
- The State Department's OIG found abuse of the department's travel program, with several hundred thousand dollars of unauthorized or improper charges on department travel cards in FY 2013-2014..
- OIG reports also reveal that lack of grant monitoring by grant officers or grant offer representatives resulted in grant funds being misspent. One audit in 2015 found $7 million in misspent grant funds simply due to lack of oversight.
- Under former Secretary of State Hilary Clinton, the department wasted billions of dollars, including $600 million in failed projects in Iraq and Afghanistan, $5.4 million on crystal stemware and $6 billion that went "missing" during her tenure.
These are just a few of many examples in just two government entities. I could probably spend the next year reading OIG reports from every agency and department, detailing example after example of improper and misused grants, no-bid contracts, employee benefit abuses, missing funds and the like.
What about Trump's cutting programs that help the poor? There has been a lot of panic today about cuts to Meals on Wheels. MOW is a non-profit that was originally started by a community of faith-based organizations. While it does receive some government funding in communities through the Housing and Urban Development\'s Community Development Block Grant program, it is not a government entity. In fact, local Meals on Wheels programs existed 20 years prior to the CDBG program and are primarily supported by individual and corporate donations. Unfortunately, CDBG funds are known for being misappropriated, not to Meals on Wheels per se, but to community redevelopment and housing renovation and construction programs. If citizens are serious about caring for the poor, they would work to prevent the numerous abuses and misuses of funds as documented in San Diego, Bayonne and Union City, New Jersey, and lots of others. Federal funding of local programs breeds corruption, mismanagement and misuse of funds.
And finally, while Trump proposes a major boost in defense spending, they are not immune to billions of dollars in fraud, waste and abuse as evidenced by their list of audit reports here.
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