Pentagon fails 7th audit in a row but says progress made
thehill.com
thehill.com
The DOD has to spend $2.3 billion dollars a day for every day of the year. That's $1.6 million per minute, 24 hours a day.
How can they possibly spend that much? The daily contracts page shows you a good chunk of it. And that's just for external expenses - not counting the costs of 1.4 million active service members and their infrastructure and equipment.
So, honestly? I'm not super surprised they might have issues keeping track of all that money.
lol
What exactly was eye popping? I took a quick look, and while the numbers are large, I don't have a sense they are larger than they should be. The first for 15-Nov is a contract for roofing for the Army for $99MM. A number of firms are competing for that, and none of these firms sounds like "the military industrial complex". One is Roofing Resources from Pennsylvania. Its page states that it is "certified women-owned small business" [1]. Do you find anything nefarious with that?
Also, what "small business" is doing those kinds of numbers, especially in a single contract?
It’s a 5 year long contract and buildings need to be reroofed every ~30 years, several million square feet sounds about right.
> Also, what "small business" is doing those kinds of numbers, especially in a single contract?
You were linked to an example. A “small business” construction firm can easily administer a $99M contract if they subcontract all of the work out and act as construction manager. One dedicated project manager could do it, honestly.
Performance and payment bonds ensure the work is completed.
Certain types of businesses have a bidding advantage on public work, depending on the funding source: minority owned businesses (MBE), women owned businesses (WBE), service disabled veteran businesses, (SDVOSB, which DoD and VA contracts often target), and others. The advantage can be as high as 12%, which can lead to the construction manager situation I described above.
My post is only relevant to construction procurement, no clue how it works outside of that.
You should probably take more than a "quick look".
It's a bit difficult to share your sense of outrage. The US is a large country, and its Department of Defense is also large. But not out of proportion. The DoD budget is less than 4% of the GDP. That money buys you the best military on the planet. By a mile. For comparison, the public elementary and secondary schools in the US spend more than the DoD, and the outcome is kind of mediocre. Do you feel outraged by the "educational industrial complex" ?
We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.
Akin to, and largely responsible for the sweeping changes in our industrial-military posture, has been the technological revolution during recent decades.
In this revolution, research has become central; it also becomes more formalized, complex, and costly. A steadily increasing share is conducted for, by, or at the direction of, the Federal government.
Today, the solitary inventor, tinkering in his shop, has been over shadowed by task forces of scientists in laboratories and testing fields. In the same fashion, the free university, historically the fountainhead of free ideas and scientific discovery, has experienced a revolution in the conduct of research. Partly because of the huge costs involved, a government contract becomes virtually a substitute for intellectual curiosity. For every old blackboard there are now hundreds of new electronic computers.
The prospect of domination of the nation's scholars by Federal employment, project allocations, and the power of money is ever present and is gravely to be regarded.
Yet, in holding scientific research and discovery in respect, as we should, we must also be alert to the equal and opposite danger that public policy could itself become the captive of a scientific-technological elite.
It is the task of statesmanship to mold, to balance, and to integrate these and other forces, new and old, within the principles of our democratic system-ever aiming toward the supreme goals of our free society.
I often wonder if spending the money is the point - simply to say “The USA spends more than the next 10 countries combined” with no consideration for whether it is getting more value for the money. Like a startup, could other countries simply be getting significantly more value for their money and so the effective gap isn’t as large as the pure numbers suggest?
It comes to mind how the Pentagon running out of ammunition in recent years so to the Russian invasion of Ukraine and US donations.
Plus our shipbuilding hadn't been the best, and our shipbuilders basically depend on defense contracts to survive instead of building warships as side gigs. Definitely areas where we need to do improvement.
We also need production of shells to support Ukraine and our Europeans allies had been underspending for decades at this point.
That’s because the munitions we spend most of our money in isn’t going to Ukraine. The stuff we would use against Russia would be wiping cities off the map from thousands of miles away. The things we gave Ukraine are intentionally limited in range and power to prevent it from escalating beyond a regional conflict (aka stuff that can’t strike important targets inside Russia).
Let's make it clear. Ukraine is forced to use their own long range drones to strike targets deep inside Russia, as opposed to also using more effective and more powerful weapons to do so.
Can we take your words to UN crime court?
This is due to differences in doctrine and force structure. The Ukrainian military burns artillery ammunition at a far higher rate than the US military ever would because the US military does not use a lot of artillery. You don’t need a lot of ammunition of a type you’ll never use much.
The idea that the US goes to war primarily to satisfy Raytheon stockholders is almost as brainless as saying it's the Zionist lobby: why struggle with thinking about a complex problem when you can conjure a simple boogeyman?
Is the alternative how you personally would spend that money? Is it how the individuals paying taxes would spend it? How about the individuals holding wealth, assuming it's debt spending that's paid for via inflation?
I like to compare to how the broader private market would have spent the same amounts toward the same goals. A lot of that money would be squandered too - many companies fail. I think if that's an issue you really care about, ask yourself how you measure the problem!
I definitely don't see a lot of people pushing for the "never to be scrutinized" part.
When you look at Nature do you start asking why do we "need" blue whales or redwood trees? No one "needs" them but they emerge anyhow.
We chimps (mysteriously) love to believe we are in control of nature and what emerges out of it. And time and again the universe takes a gigantic shit on that belief. See Theory of Bounded Rationality/Illusion of Control or read Jurassic Park.
Its also why we see monopolies emerge in every sector of the Economy inspite of all kinds of speech making, laws and govt depts to "control" things.
If you go look at the Annual Report of your favorite monopoly, you will find hundreds if not thousands of subsidiaries/factories/offices around the planet to manage their empire. No External Auditor visits each of those sites cause its just not possible within a reporting period. So every report has a large warning - hey man this our best guess about whats going on in the 10% of the sites we had time to visit - don't sue us.
Don't fall for the notion that people have perfect control over complex ever changing systems. It will just lead to misunderstandings and confusion.
You completely misunderstand the purpose of the speech.
The speech is an acknowledgement that it was necessary due to the changing nature of warfare and geopolitics [0], but at the same time warning that it we should be vigilant about not allowing government to be captured by it.
The same way the banking or tech industries are important and necessary, but shouldn't be allowed to directly further their own interests by setting government policy, but with additional moral gravity given the nature of the military.
[0] this was an era where military weaponry was becoming sophisticated enough that you couldn't just e.g. convert civilian car factories to produce tanks anymore, and you wouldn't have time to do it either, because the ICBMs and long range bombers on the horizon removed the invulnerability of the US mainland. Sitting tight to build up a military over the course of multiple years as was the case during WWII was no longer an option, so combined with the threat of the Soviet Union it was obvious that the US would need to maintain a large standing military and the accompanying industries for the first time in it's history. It was a novel, necessary, and nonetheless dangerous development, and that's what he was trying to get across.
I think Ukraine is a good value war for the US though, besides the issue of sending them outdated munitions, we get to cripple a geopolitical rival sacrificing other countries soldiers
I would be more worried about Disney and Apple and their unwarranted influence.
MIC is not just the defense companies, read the name again - it' the complex made of industry and the military. And Eisenhower's point in warning against it is not about revenue of the industry part, but about influence of the whole complex on major decisions.
In 1990's there was a short dip in funding, but since 2000's, its growth caught back on, and it's getting close to a trillion dollars a year. That much money chases a lot of constituency and a lot of power. Millions of people are dependent on it.
No, relwin brought it up, and I ridiculed the criterion. I don't get your point at all, sorry.
Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.
This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete pavement. We pay for a single fighter plane with a half million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people. —-
A old soldier who was horrified at the cost of war, but keenly and sadly aware of the necessity of preparation and defense.
I've seen it first hand.
https://x.com/elonmusk/status/1857919131464478752
Of course it does. But every loophole and tax break comes with an influential constituency attached to it.
(Policies regarding 401k's and homes can affect powerful people too.)
One of the oldest examples of tax simplification is the flat income tax. This is extremely regressive and disadvantages the poor and middle class. Any exemption would be “complication”.
If there’s good and bad complication then simplicity is the wrong dimension on which to focus.
Why is simplicity desirable in the tax code? Who does it benefit and how?
I agree, though using taxes is an efficient way to incentivize: If you want to fund home ownership, you can either identify each homeowner, cut checks, and mail them; or you can achieve a similar result by reducing taxes for homeowners.
I'm not sure the former isn't worth the extra hassle, for the reason you describe.
I think it helps democratically - people understand the code and could believe in its fairness.
> One of the oldest examples of tax simplification is the flat income tax. This is extremely regressive and disadvantages the poor and middle class.
I agree, but that's also a perversion of 'simplification'. If you follow that logic, the even simpler tax would be that everyone pays the same amount, not the same rate. E.g., everyone pays $10K, no matter what.
Obviously that's ridiculous, and so is the flat (rate) income tax. Simplicity and fairness is not equal tax or equal rate, but equal sacrifice.
Ok but to what benefit? Progressive tax codes are both complex and fair.
> I agree, but that's also a perversion of 'simplification'. If you follow that logic, the even simpler tax would be that everyone pays the same amount, not the same rate. E.g., everyone pays $10K, no matter what.
Ok, then what is true simplification?
This is where I don’t find the argument that taxes need to be simple compelling. What’s the benefit?
I remember several times when in my tax classes in law school looking at the history of complicated provisions and finding they started out as short and simple provisions whose meaning was obvious to anyone with common sense.
But then people would find ambiguities that could give them a favorable tax result. There would be a court fight over it, and eventually the provision would be change to be more precise. And so what had been short and simple because longer and more complicated.
I don't remember all the details (law school was 30+ years ago and afterwards I decided I'd rather go back to programming than become a lawyer), but I remember the overall gist of one example.
Some big company around the 1930s or so came up with a clever idea. Next time they were going to pay a dividend instead they did a fractional stock split, such as 1.01 to 1, immediately followed by a mandatory fraction buyback which resulted in each shareholder getting the amount of money they would have gotten if a dividend had been declared, and with no change in each shareholder's percentage ownership of the company unchanged. The company suggested that shareholders report that money as capital gains.
The IRS said it was really a dividend, and the IRS won that dispute. The tax code and/or regulations were updated to reflect that. But there are legitimate buybacks that really should get capital gains treatment, and so those updated rules had a bunch of clauses and steps to go through to apply them to any specific case.
Most of the money public k-12 schools get from municipal property taxes, and most of the public funding that state universities receive comes from the state level.
yes, during a mini-recession IIRC. we're around that point.
>Education is funded by the states.
and federal funding.
I tried searching and it looks like social security is the biggest expense of the budget. Medicare is larger than defense, excluding other health stuff like Medicaid and public health spending, which separately also add up to more than defense. That said I agree defense spending is out of control and inefficient, probably due to big contractors who have been robbing taxpayers for decades.
If Trump gets the tax cuts he talked about before the election that moves up the exhaustion of the trust fund by 1-3 years depending on whose projections you use.
There are two approaches that can reasonably get Congressional support.
1. Raise the retirement age to 69 or 70 (from the current 67). You could still retire as early as 62 just like now, but when you retire early your benefit is less than your full benefit amount.
Most projections I've seen have that adding a few years to the life of the trust fund.
2. Raise the cap on the payroll tax. The payroll tax is a flat rate tax on payroll (half paid by the employee and half by the employer) on the first $168k of you annual pay.
Raising that cap to something like $400k would extend the life of the trust fund something like 70 years.
From what I've read both Democrat and Republican voters strongly favor approach #2.
In Congress Democrats favor #2 and Republicans favor #1.
We probably should do both. One of the Republican arguments for #1 is that people live longer now, so it makes sense to raise the retirement age. But #1 is only a relatively short term fix for the trust fund.
#2 is long term. In particular #2 fixes it long enough to get well past dealing with the situation we are in now where people born at the peak of the baby boom are retiring. We are seeing around 11k people a day turning 65. It's expected to remain in that ballpark through 2027. With #1 the trust fund should be good long past the time all those people have died.
So do #2 to deal with the trust fund. Do #1 to address longer lifespans (if we decide that your longer life should mean more working years rather than more retirement years).
Because ultimately politics is about getting votes. And there simply aren't any votes in making the US government more efficient or balancing the budget.
I hear this and wonder how The New Deal ever managed to get off the proposal floor. Real shame how underinformed the voting populace is.
The largest buckets non defense buckets are social security (1.4 trillion), medicare+medicaid (~1.6 trillion), interest payments (~800 billion). Total DOD spending is like ~750 billion, and DHS is like ~100 billion. FY2023 deficit was roughly 1.7 trillion dollars
Social security and medicare together at like ~2.4 trillion dollars a year, and are supporting a population of roughly 55 million Americans (just grossly taking the 65+ age population). This works out to roughly 43k per year per 65+ adult. You can decide for yourself is this seems like the right way for the government to work.
Anyhow, I am certain there is a lot of waste, and a lot of different types of waste there.
But fundamentally, the US government is trying to do a lot of frankly difficult and gigantic tasks. The DoD is tasked with amongst other things, perpetuating American hegemony, which right now is kinda critical for the entire US government funding situation. The USG's ability to leverage USD status as the world's reserve currency to help fund expenditures is contingent on it being if not THE global hegemon, then at least amongst the world's top powers, and the hegemon (or uh... senior security partner) for a substantial fraction of the world's economy.
New City Herald
Rioters set fire to the entire city after the Mayor's new budget accidentally starved roughly 8.6 million disabled people and 6 million survivors of deceased retirees.
Try File -> New City to start over.
Wait, so they had wills for their kids and the government just... took that money? How does that work, or am I way off base?
For example the navy exists as "force projection" - not coastal protection. Force protection is a foreign policy goal, not a "defense" goal.
The US military is not designed to fight on the US mainland, it's designed to fight on someone else's mainland.
Equally the medicaid budget could be way less. Other countries manage with less (for their entire population) but they dictate pricing, whereas in the US the suppliers dictate pricing. And they expect healthy profit margins at every point.
In general, the govt spends so much because the people charge so much. The govt has enormous negotiating muscle, but dares not flex it least they incur the wrath of "the free market".
Every other nation spends less because they are not the global hegemon. USD is in the position it is because we are the global hegemon. If you remove that by spending less on defense, USD strength goes down and our budget deficit and outstanding government debt start going up, weakening the country.
This idea that military spending is not a large chunk of the budget is only when one has a very, very narrow definition of military spending.
Everything else is a lot smaller and a lot simpler.
- Environmental Protection Agency (EPA)
- State Department
- Science and Public Health Offices
- Civil Rights Offices
DOGE doesn't have to do something new or significant, all they have to do is to promote it better even if it's the same actions by any republican reaching office.
b) I don't think that's true. And even if were to suppose that it were true then your accounting problem would be so easy to solve.
c) Agreed. That outcome is more likely.
Politics is hard. Government spending is death by a thousand cuts, so the easy things to do are two: remove whole departments (remove all of the education, veterans, and defence, that will net you 1.5T) or ask the heads of each department to do the cuts. But then each one will face the same issue, and the deeper you go, the more you encounter people who want a specific spending e.g. reps who got elected supporting veteran support or education spending or a specific factory in Springfield, Illinois.
People favor spending cuts the way they favor tax breaks: don’t cut you, con’t cut me, cut that fellow behind the tree.[0] everyone's is for them in the abstract as long as they don't touch them.
And yes, I think the richest man in this world does not know how federal funds are being spent, based on the fact that he thinks he can cut "at least 2T" out 6.5T. To save 2T you'd have to erase the Department of Health[1]. If you cut 50% of Social Security, Health and Defence, you'll not get that, and people will riot.
Also, I point you to X, where Musk managed to save money by firing 70% of the workforce and <checks notes> losing 80% of the company value. The fact SpaceX and Tesla are successful[2] does not automatically translate in Musk being good at everything.
[0] https://quoteinvestigator.com/2014/04/04/tax-tree/ [1] https://fiscaldata.treasury.gov/americas-finance-guide/feder... [2] both, let me point out, with massive help from government expenditures
If the solution is not to cut excessive and unchecked spending, you tell us your solution for the dealing with the problem?
> remove whole departments (remove all of the education, veterans, and defence, that will net you 1.5T)
AFAIK DOGE or rather Elon hasn't specified how they are going to cut $2T from the annual budget so all this is speculation and we don't actually know which sectors might receive the cuts. For all we know it could be a goal setting figure. Even if they don't reach this target, the endeavour is still worthwhile. They have 4 years to sell their plans to Congress after all.
In summary you fail to make a good case for why DOGE is a bad idea other than Elon bad. I challenge you to remove this bias from your thinking, it alone just may help you avoid missing the forest for the trees on the issue of government overspend and the relation to uncontrollable public debt.
There is no need to create another new program instead of improving what already exists, except that GAO is non-partisan so it won’t cut whatever the new administration says it should, and Musk wouldn’t join it unless he’s at the top.
Here's them in 2022 saying $247B [1] got lost in that year due to "payment errors".
Looks like their job is to only make recommendations on spending and nothing more.
[0] https://www.gao.gov/blog/gaos-scorecard-how-we-saved-federal...
[1] https://www.gao.gov/blog/federal-payment-errors-known-improp...
The new department will do exactly the same. Congress controls spending, so recommendations are all any executive department can do. If GAO should be able to find more inefficiencies, or should be given the power to cut stuff on its own (it shouldn’t), then the focus ought to be on making them do that. Adding a whole new redundant department seems…inefficient.
Stop the funding and see what breaks?
They don't want the transparency.
I’m sure there is plenty of waste to be found but also that only a tiny amount of that won’t involve significant political wrangling.