Federal "Overpayments" Twice Deficit

Tuesday, October 06, 2015

Update: The above title and the next sentence are WRONG, not that you'd need me to point that out. The error carries forward, too. Please see also note at bottom of post. My apologies to Elizabeth MacDonald and my readers.

Elizabeth MacDonald reports at Fox Business that the federal government makes $1 trillion a year in "overpayments."

The GAO said three programs were most at fault: Medicare, Medicaid and the Earned Income Tax Credit (EITC). These three government programs were responsible for a full three-quarters of the nearly $19 billion in erroneous payments the federal government made in fiscal 2014, the GAO said. "Improper payments remain a significant and pervasive government-wide issue," the Congressional watchdog unit warned.
I'll grant that this is an enormous sum -- over $3100 per man, woman, and child living in America today. It is interesting to ponder this amount in light of the 2015 Federal Budget.

I have to admit mild surprise at a couple of things. First, total expenditures, $3.9 trillion, are barely less than four times this amount. Second, this amount is almost twice the budget deficit, which is $564 billion. (All these pale in comparison to the federal debt of $18.7 trillion.) This all reminds me of something I said years ago that I must revisit:
Such grassroots efforts as "Pork Busters" form when enough people become outraged at such things as that infamous "bridge to nowhere" -- and yet nobody challenges the massively larger larceny cum vote purchasing that is the welfare state, and which makes such relatively penny-ante outrages possible at all. [links dropped]
I guess the "larceny cum vote purchasing" (assuming the payments in the report really are unintentional) isn't "massively larger" after all. That said, it is still wrong to focus on what the GAO calls "improper payments" since doing so grants a false claim of legitimacy to so many improper government functions: All looting of wealth -- required by these payouts -- by the government is wrong, regardless of the intended purpose or recipient.

-- CAV


Today: (1) On reviewing this post, I see that when I composed it yesterday, I missed the following, among other things:   "Since fiscal 2003, 'cumulative improper payment estimates have totaled almost $1 trillion,' the Government Accountability Office (GAO) said in a new report." [my bold] Obviously, this makes my title wrong, but my earlier conclusion about such causes as "pork busters" correct. Fraud, waste, and abuse -- if we set aside for a moment whether we ought to apply the terms to the whole entitlement-regulatory state -- really are penny-ante compared to the many programs we ought to be concerned with. (2) Added update notice to top of post.

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