Tag Archives: Pentagon audit

How the Pentagon Devours the Budget, Normalizing Budgetary Bloat, by William Hurting

The Pentagon has never been subjected to an audit, but Congress has passed two years worth of budgets that give it, and its contractors, huge increases over prior years, everything they could dream of…and more. From William Hartung at tomdispatch.com:

Imagine for a moment a scheme in which American taxpayers were taken to the cleaners to the tune of hundreds of billions of dollars and there was barely a hint of criticism or outrage.  Imagine as well that the White House and a majority of the politicians in Washington, no matter the party, acquiesced in the arrangement.  In fact, the annual quest to boost Pentagon spending into the stratosphere regularly follows that very scenario, assisted by predictions of imminent doom from industry-funded hawks with a vested interest in increased military outlays.

Most Americans are probably aware that the Pentagon spends a lot of money, but it’s unlikely they grasp just how huge those sums really are.  All too often, astonishingly lavish military budgets are treated as if they were part of the natural order, like death or taxes.

The figures contained in the recent budget deal that kept Congress open, as well as in President Trump’s budget proposal for 2019, are a case in point: $700 billion for the Pentagon and related programs in 2018 and $716 billion the following year.  Remarkably, such numbers far exceeded even the Pentagon’s own expansive expectations.  According to Donald Trump, admittedly not the most reliable source in all cases, Secretary of Defense Jim Mattis reportedly said, “Wow, I can’t believe we got everything we wanted” — a rare admission from the head of an organization whose only response to virtually any budget proposal is to ask for more.

The public reaction to such staggering Pentagon budget hikes was muted, to put it mildly. Unlike last year’s tax giveaway to the rich, throwing near-record amounts of tax dollars at the Department of Defense generated no visible public outrage.  Yet those tax cuts and Pentagon increases are closely related.  The Trump administration’s pairing of the two mimics the failed approach of President Ronald Reagan in the 1980s — only more so.  It’s a phenomenon I’ve termed “Reaganomics on steroids.”  Reagan’s approach yielded oceans of red ink and a severe weakening of the social safety net.  It also provoked such a strong pushback that he later backtracked by raising taxes and set the stage for sharp reductions in nuclear weapons.

To continue reading: How the Pentagon Devours the Budget, Normalizing Budgetary Bloat

Pentagon Auditor Can’t Account For $800 Million In Spending, by Tyler Durden

For the first time ever the Pentagon is being audited and already hundreds of millions of dollars can’t be accounted for. From Tyler Durden at zerohedge.com:

The Pentagon’s Defense Logistics Agency (DLA) has reportedly “lost track” of hundreds of millions of dollars it spent,  said Ernst & Young, the accounting firm conducting the first-ever Pentagon audit, according to Politico.

E&Y discovered that DLA “failed to properly document more than $800 million in construction projects,” said Politico, which also reported this is just one of the many instances where millions of dollars went missing as the accountability system inside the Pentagon is broken. Worse, according to Politico, the first-ever audit, covering the fiscal year that ended Sept. 30, 2016, signals complete incompetence about how the Pentagon handles its $700 billion annual budget.

While these comments from Ernst & Young are mindnumbing, the Trump administration is set to ask Congress for $716 billion for defense spending for fiscal 2019, a 7% increase over the 2018 Budget. Budget analysts have sounded warnings this would be a significant surge in spending for the Pentagon at a time when the organization can barely keep track of its current expenditures.

If you can’t follow the money, you aren’t going to be able to do an audit,” Sen. Chuck Grassley, an Iowa Republican and senior member of the Budget and Finance committees, who has suggested to past administrations that hemorrhaging of wasteful spending at the Pentagon must stop.

Army Lt. Gen. Darrell Williams, the agency’s director, wrote in response to Ernst & Young’s bombshell findings that the audit has “provided us with a valuable independent view of our current financial operations.”

“We are committed to resolving the material weaknesses and strengthening internal controls around DLA’s operations,” he said, according to Politico.

To continue reading: Pentagon Auditor Can’t Account For $800 Million In Spending