Want to Cut Government Waste? Find the $8.5 Trillion the Pentagon Can’t Account For

[fredjr82]

If you thought the botched roll-out of Obamacare, the government shutdown, or the sequester represented Washington dysfunction at its worst, wait until you hear about the taxpayer waste at the Defense Department.

Special Enterprise Reporter Scot Paltrow unearthed the “high cost of the Pentagon’s bad bookkeeping” in a Reuters investigation. It amounts to $8.5 trillion in taxpayer money doled out by Congress to the Pentagon since 1996 that has never been accounted for. (The year 1996 was the first that the Pentagon should have been audited under a law requiring audits of all government departments. Oh, and by the way, the Pentagon is the only federal agency that has not complied with this law.)


Here are some some highlights he found among the billions of dollars of waste and dysfunctional accounting at the Pentagon:

The DOD has amassed a backlog of more than $500 billion in unaudited contracts with outside vendors. How much of that money paid for actual goods and services delivered isn’t known.

Over the past 10 years the DOD has signed contracts for provisions of more than $3 trillion in goods and services. How much of that money is wasted in over payments to contractors, or was never spent and never remitted to the Treasury is a mystery.

The Pentagon uses a standard operating procedure to enter false numbers, or “plugs,” to cover lost or missing information in their accounting in order to submit a balanced budget to the Treasury. In 2012, the Pentagon reported $9.22 billion in these reconciling amounts. That was up from $7.41 billion the year before.
The accounting dysfunction leads the DOD to buy too much stuff. One example: the “vehicular control arm” to supply Humvees. In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had.

The accounting dysfunction leads the DOD to buy too much stuff. One example: the “vehicular control arm” to supply Humvees. In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had.

The Defense Department’s 2012 budget was $565.8 billion. Paltrow points out that’s more than the annual defense budgets of the next 10 biggest military spenders combined. He tells us the Pentagon “almost certainly is” the biggest source of waste in the government based on his reporting

https://finance.yahoo.com/blogs/dai...nt-waste-8-5-trillion-pentagon-142321339.html

 

[naturalmwa]

Those secret wars don't fund themselves. You got two options. Either look away as we do now, or we could go back to the days of $500 toilet seats to hide it in an audit. I suppose we could stop secret wars, but you know that's not happening any time soon.

 

[theVoicefromtheTomb]

But what about all the welfare queens?

 

[naturalmwa]

But what about all the welfare queens?

Thats what the thread is about.

 

[SSG T]

I know this isn't directly related (more of a causal relationship), but I keep saying you could cut the DOD budget by at least half and not affect our ability to fight a war or two. It wouldn't remove the problem addressed in the OP, but it would lessen its affects.

Now, this assumes that everyone involved would cut the things they should and leave the things they shouldn't touch alone, which I have no faith in anyone in the Senate, House or DOD itself to do.

 

[IMCC965]

$8.5 TRILLION unaccounted for? Don't believe it. Sorry.

 

[fredjr82]

$8.5 TRILLION unaccounted for? Don't believe it. Sorry.

Nobody really cares what your opinion is anyways, so no harm done.

 

[Nat Algren]

$8.5 TRILLION unaccounted for? Don't believe it. Sorry.

Would you believe it if someone from the GOP told you so?

 

[Nat Algren]

Here's Rumsfeld just 1 day before 9/11/01 announcing $2.3 TRILLION.

 

[IMCC965]

Would you believe it if someone from the GOP told you so?

No.

 

[IMCC965]

Nobody really cares what your opinion is anyways, so no harm done.

I'm crushed.

 

[who r u]

No.

you should change your sig pic to this.

 

[Nat Algren]

No.

And what do you know. One day later, the Pentagon is hit that houses the records. I guess the taxpayers will just have to absorb the loss. Who has the elfin money?

 

[TexMichFan]

How can it all not be accounted for when they have examples of it was spent on stuff we don't need?

Plus can you find any updates after November of 2013 when the article was written that finds more examples of wasteful spending or fraud?

 

[thewop]

My assumption is that when it comes to matters of national security, the majority of the money spent is waste. Most leads followed, most security measures taken, most airport screenings yield no result in terms of making us safer, and are therefore waste. 99% of what contract lawyers do is waste (protecting someone just in case...), most of what you pay for insurance of any kind is a waste (at least you hope it is). It only stands to reason that a HUGE percentage of what the pentagon spends is a waste...

However: I want airport security, I want the NSA/FBI following leads on criminals, I want contract lawyers (sometimes), and I want insurance too. Finally, I want a strong military that's capable of FAR MORE than what we ever ask them to do, and frankly, in an ideal world ALL the money we spend on the military would go to waste. How much waste is too much waste? I don't know, nor do I know if the real number is $8 Trillion, which sounds more like a politically motivated fear statistic than anything.

Regarding welfare: I don't hope the money we spend on welfare is a waste. I want every dime we spend to go to someone who is unable to care for themselves and truly needs it because they cannot hack it on their own, not because they will not make it on their own. I advocate taking care of those in need within our borders before we take care of those in other countries, but wouldn't mind cleaning up our entitlement programs so we can make a bigger difference in the world than we currently are.

sorry, that got long. Rant done.

 

[PhantomFlyer]

" In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had."

This isn't really true. What most likely happened in most of these cases was a unit requisitioned the part, where the inventory specialists at the depot went to pull the part it wasn't in inventory (yes, bad inventory records). There are other reasons, like they could have went out and found the part was no longer serviceable (for example, tires have a shelf life). Finally, the parts could have been unserviceable, meaning they would have to be repaired at a depot, army contractor, or another army facility. Depending on the condition of the unserviceable assets, cost to repair, etc, it may be cheaper in time and money to buy new than repair.

There's plenty of waste, but it's not near as grim as the article makes it sound. Most of the bookkeeping errors my command encountered came from the depots over in Afghan and Iraq. When you are in the middle of a war, units aren't so concerned about making sure the books are accurate as they are making sure they have the parts to fulfill their mission, which was to kill the bad guys.

 

[HallofFame]

Area 51 and ISIS

 

[L. Wade Childress]

I don't care about wasted money on national defense. people take our complete safety for granted.

 

[naturalmwa]

My assumption is that when it comes to matters of national security, the majority of the money spent is waste. Most leads followed, most security measures taken, most airport screenings yield no result in terms of making us safer, and are therefore waste. 99% of what contract lawyers do is waste (protecting someone just in case...), most of what you pay for insurance of any kind is a waste (at least you hope it is). It only stands to reason that a HUGE percentage of what the pentagon spends is a waste...

However: I want airport security, I want the NSA/FBI following leads on criminals, I want contract lawyers (sometimes), and I want insurance too. Finally, I want a strong military that's capable of FAR MORE than what we ever ask them to do, and frankly, in an ideal world ALL the money we spend on the military would go to waste. How much waste is too much waste? I don't know, nor do I know if the real number is $8 Trillion, which sounds more like a politically motivated fear statistic than anything.

Regarding welfare: I don't hope the money we spend on welfare is a waste. I want every dime we spend to go to someone who is unable to care for themselves and truly needs it because they cannot hack it on their own, not because they will not make it on their own. I advocate taking care of those in need within our borders before we take care of those in other countries, but wouldn't mind cleaning up our entitlement programs so we can make a bigger difference in the world than we currently are.

sorry, that got long. Rant done.

This seems like a really good post. Are you a contract lawyer?

 

[SigMaintHawk]

Any of this for "black ops" or is that funded/accounted for in a different way? I know at one time, the so called "black budget", was quite large....

 

[22*43*51]

This has been going on forever.

In the 80's they tried to slide by 2k dollar toilet seats and 5k hammers.

Now they don't even go through those motions.

It's just "lost".

 

[torbee]

If you thought the botched roll-out of Obamacare, the government shutdown, or the sequester represented Washington dysfunction at its worst, wait until you hear about the taxpayer waste at the Defense Department.

Special Enterprise Reporter Scot Paltrow unearthed the “high cost of the Pentagon’s bad bookkeeping” in a Reuters investigation. It amounts to $8.5 trillion in taxpayer money doled out by Congress to the Pentagon since 1996 that has never been accounted for. (The year 1996 was the first that the Pentagon should have been audited under a law requiring audits of all government departments. Oh, and by the way, the Pentagon is the only federal agency that has not complied with this law.)


Here are some some highlights he found among the billions of dollars of waste and dysfunctional accounting at the Pentagon:

The DOD has amassed a backlog of more than $500 billion in unaudited contracts with outside vendors. How much of that money paid for actual goods and services delivered isn’t known.

Over the past 10 years the DOD has signed contracts for provisions of more than $3 trillion in goods and services. How much of that money is wasted in over payments to contractors, or was never spent and never remitted to the Treasury is a mystery.

The Pentagon uses a standard operating procedure to enter false numbers, or “plugs,” to cover lost or missing information in their accounting in order to submit a balanced budget to the Treasury. In 2012, the Pentagon reported $9.22 billion in these reconciling amounts. That was up from $7.41 billion the year before.
The accounting dysfunction leads the DOD to buy too much stuff. One example: the “vehicular control arm” to supply Humvees. In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had.

The accounting dysfunction leads the DOD to buy too much stuff. One example: the “vehicular control arm” to supply Humvees. In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had.

The Defense Department’s 2012 budget was $565.8 billion. Paltrow points out that’s more than the annual defense budgets of the next 10 biggest military spenders combined. He tells us the Pentagon “almost certainly is” the biggest source of waste in the government based on his reporting

https://finance.yahoo.com/blogs/dai...nt-waste-8-5-trillion-pentagon-142321339.html

If you thought the botched roll-out of Obamacare, the government shutdown, or the sequester represented Washington dysfunction at its worst, wait until you hear about the taxpayer waste at the Defense Department.

Special Enterprise Reporter Scot Paltrow unearthed the “high cost of the Pentagon’s bad bookkeeping” in a Reuters investigation. It amounts to $8.5 trillion in taxpayer money doled out by Congress to the Pentagon since 1996 that has never been accounted for. (The year 1996 was the first that the Pentagon should have been audited under a law requiring audits of all government departments. Oh, and by the way, the Pentagon is the only federal agency that has not complied with this law.)


Here are some some highlights he found among the billions of dollars of waste and dysfunctional accounting at the Pentagon:

The DOD has amassed a backlog of more than $500 billion in unaudited contracts with outside vendors. How much of that money paid for actual goods and services delivered isn’t known.

Over the past 10 years the DOD has signed contracts for provisions of more than $3 trillion in goods and services. How much of that money is wasted in over payments to contractors, or was never spent and never remitted to the Treasury is a mystery.

The Pentagon uses a standard operating procedure to enter false numbers, or “plugs,” to cover lost or missing information in their accounting in order to submit a balanced budget to the Treasury. In 2012, the Pentagon reported $9.22 billion in these reconciling amounts. That was up from $7.41 billion the year before.
The accounting dysfunction leads the DOD to buy too much stuff. One example: the “vehicular control arm” to supply Humvees. In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had.

The accounting dysfunction leads the DOD to buy too much stuff. One example: the “vehicular control arm” to supply Humvees. In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had.

The Defense Department’s 2012 budget was $565.8 billion. Paltrow points out that’s more than the annual defense budgets of the next 10 biggest military spenders combined. He tells us the Pentagon “almost certainly is” the biggest source of waste in the government based on his reporting

https://finance.yahoo.com/blogs/dai...nt-waste-8-5-trillion-pentagon-142321339.html

Hey, at least the money isn't going to poor black people or immigrants. No big deal.

 

[thewop]

This seems like a really good post. Are you a contract lawyer?

LOL. No, heck no. It's just that when I was in the corporate world, the contract lawyers were always slowing down business, and generally being a pain in the backside over "what if's" that were unlikely to come to fruition. BUT, every once in a blue moon something came up and they were proven right, and had likely stopped us from making a very costly error. So 99% of everything they did was a total waste, but that 1% made their toil worth it.

 

[sijoint]

" In 2008, the DOD had 15,000 parts -- a 14-year supply (anything more than three years is considered excess supply). Yet from 2010 to 2012, it bought 7,437 more of these parts and at higher prices than they paid for the ones they already had."

This isn't really true. What most likely happened in most of these cases was a unit requisitioned the part, where the inventory specialists at the depot went to pull the part it wasn't in inventory (yes, bad inventory records). There are other reasons, like they could have went out and found the part was no longer serviceable (for example, tires have a shelf life). Finally, the parts could have been unserviceable, meaning they would have to be repaired at a depot, army contractor, or another army facility. Depending on the condition of the unserviceable assets, cost to repair, etc, it may be cheaper in time and money to buy new than repair.

There's plenty of waste, but it's not near as grim as the article makes it sound. Most of the bookkeeping errors my command encountered came from the depots over in Afghan and Iraq. When you are in the middle of a war, units aren't so concerned about making sure the books are accurate as they are making sure they have the parts to fulfill their mission, which was to kill the bad guys.

Way to go Obama.....2,300 armed Humvee's.....gift to ISIS? Stop wasting our money on the enemy.

 

[naturalmwa]

Way to go Obama.....2,300 armed Humvee's.....gift to ISIS? Stop wasting our money on the enemy.

If we write these off, could we balance the budget? Just say each one of the hummers is worth a billion and make the math work. Problem solved. Someone should elect me, I have all the answers.

 

[PhantomFlyer]

Way to go Obama.....2,300 armed Humvee's.....gift to ISIS? Stop wasting our money on the enemy.

If Obama was President during the Cold War he would have been giving the stuff free to the Russians.

 

[pepsicock]

 

[What Would Jesus Do?]

Those secret wars don't fund themselves. You got two options. Either look away as we do now, or we could go back to the days of $500 toilet seats to hide it in an audit. I suppose we could stop secret wars, but you know that's not happening any time soon.

The only people those wars are kept secrets from are Americans. Thank god most Americans don't watch or read foreign news reports or non-corporate news.

Why not just admit that we are the empire we obviously are, doing the things we obviously do? Then we could account honestly for what we spend.

The thing is, the kickbacks and bribery might come to light. The MISC (military industrial surveillance complex) is getting too much under-the-table money to let that happen.

 

[Nat Algren]

The only people those wars are kept secrets from are Americans. Thank god most Americans don't watch or read foreign news reports or non-corporate news.

Why not just admit that we are the empire we obviously are, doing the things we obviously do? Then we could account honestly for what we spend.

The thing is, the kickbacks and bribery might come to light. The MISC (military industrial surveillance complex) is getting too much under-the-table money to let that happen.

Point of note re: surveillance.

"The technetronic era involves the gradual appearance of a more controlled society. Such a society would be dominated by an elite, unrestrained by traditional values. Soon it will be possible to assert almost continuous surveillance over every citizen and maintain up-to-date complete files containing even the most personal information about the citizen. These files will be subject to instantaneous retrieval by the authorities." - Zbigniew Brzezinski

 

[Nat Algren]

If Obama was President during the Cold War he would have been giving the stuff free to the Russians.

Should Reagan be congratulated for selling arms to the Russians?

 

[Nat Algren]

My assumption is that when it comes to matters of national security, the majority of the money spent is waste. Most leads followed, most security measures taken, most airport screenings yield no result in terms of making us safer, and are therefore waste. 99% of what contract lawyers do is waste (protecting someone just in case...), most of what you pay for insurance of any kind is a waste (at least you hope it is). It only stands to reason that a HUGE percentage of what the pentagon spends is a waste...

However: I want airport security, I want the NSA/FBI following leads on criminals, I want contract lawyers (sometimes), and I want insurance too. Finally, I want a strong military that's capable of FAR MORE than what we ever ask them to do, and frankly, in an ideal world ALL the money we spend on the military would go to waste. How much waste is too much waste? I don't know, nor do I know if the real number is $8 Trillion, which sounds more like a politically motivated fear statistic than anything.

Regarding welfare: I don't hope the money we spend on welfare is a waste. I want every dime we spend to go to someone who is unable to care for themselves and truly needs it because they cannot hack it on their own, not because they will not make it on their own. I advocate taking care of those in need within our borders before we take care of those in other countries, but wouldn't mind cleaning up our entitlement programs so we can make a bigger difference in the world than we currently are.

sorry, that got long. Rant done.

However, our defense budget would be soon much smaller if we just cut off the funding and selling of weapons to our enemies to the delight of defense contractors. If there isn't an enemy, they will create one.

 

[What Would Jesus Do?]

Point of note re: surveillance.

"The technetronic era involves the gradual appearance of a more controlled society. Such a society would be dominated by an elite, unrestrained by traditional values. Soon it will be possible to assert almost continuous surveillance over every citizen and maintain up-to-date complete files containing even the most personal information about the citizen. These files will be subject to instantaneous retrieval by the authorities." - Zbigniew Brzezinski

Yep. And note that Zbig doesn't say this is only a danger in the hands of government, as many here seem to believe. Even though the Freedom Act may be somewhat better than the PATRIOT Act, it seems that the main difference is that it puts relatively less-accountable corporations in control of more of the surveillance sphere. Does anyone really think that's an improvement?

 

[Nat Algren]

Yep. And note that Zbig doesn't say this is only a danger in the hands of government, as many here seem to believe. Even though the Freedom Act may be somewhat better than the PATRIOT Act, it seems that the main difference is that it puts relatively less-accountable corporations in control of more of the surveillance sphere. Does anyone really think that's an improvement?

Zbig knows who holds the power, as he is the insider's insider. He is the academic for the Ruling Elite along side Kissinger. The two were groomed by Nelson and David Rockefeller.