Yeah, the federal government is so wise and competent! We should DEFINITELY let them run our retirement, our health care, our education, our transportation and basically every single facet of our lives. Super good idea!
OpenTheBooks.com auditors quantified the improper and mistaken payments admitted to by the 17 largest federal agencies. It amounts to a staggering $2.9 trillion since 2004, when the totals are adjusted for inflation.
Last year, in 2022, improper and mistaken federal payments totaled $247 billion. That’s about $20.5 billion per month, or more than $675 million every, single day.
What exactly is an improper payment? Federal law defines the term as “payments made by the government to the wrong person, in the wrong amount, or for the wrong reason.”
In other words, a corner grocery store has better accounting controls than our $6.82 trillion U.S. federal government had in 2021.
The biggest offenders: the Departments of Human & Human Services (HHS), Treasury, Labor (DOL), and Education (ED); and the Small Business Administration (SBA).
Improper payments in health care are especially troubling. In 2011, when President Barack Obama signed the Affordable Care Act, Congress vowed to help pay for it by rooting out waste, fraud, corruption and taxpayer abuse from the Medicare and Medicaid programs.
That never happened.
In fact, the improper payments within these programs soared from $64 billion in 2012 to $136 billion today.
How did the feds waste our money in 2022? Covid-aid programs, as the GAO has said, were especially susceptible to mistakes. Those were in addition to the perennial botched spending.
For starters, dead people received $533 million in benefits: social security payments, federal pensions, and old-age, survivors, and disability insurance kept flowing long after these Americans were gone.
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A few more egregious examples:
- The Small Business Administration made improper payments through seven of its programs. The Paycheck Protection Program, or PPP, was designed to help small businesses keep employees during the draconian shutdown measures. But it misspent more than $29 billion—$16.5 billion through “unknown” payments, and $12.5 billion by “improper” payments. (The SBA Inspector General has also admitted to $100 billion in fraudulent aid, including $78.1 billion in PPP fraud.)
- The Department of Labor spent $18.9 billion incorrectly. Federal State Unemployment Insurance, a program that historically makes up most of the total improper payments, did so again. (Current estimates are $400 billion in unemployment fraud!)
- At the Social Security Administration, the Old-Age, Survivors, and Disability Insurance program flubbed $2.5 billion, while Supplemental Security Income sent $4.9 billion astray.
- 14 Department of Agriculture programs botched $19 billion worth of spending. The Farm Service Agency Coronavirus Food Assistance Program mis-spent $743 million.
- The Commodity Credit Corporation Agriculture Risk Coverage and Price Loss Coverage lost $379 million.
- The Department of Education admitted that nearly $6 billion went wrong from funds earmarked for “COVID-19 recovery and rebuilding efforts.” Pell Grants, meanwhile, wasted $586 million.
These are just a few of the seemingly endless examples. Read through all of them here.