Accounting / Auditing

“No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Statement and Account of the Receipts and Expenditures of all public Money shall be published from time to time.” Article I, Section 9, Clause 7, The US Constitution

ACCOUNTING / AUDITING PROBLEMS

1. The US government routinely can not account for TRILLIONS of dollars.

On September 10th, 2001, the day before 9/11, Secretary of Defense Donald Rumsfeld reported that the Pentagon could not account for $2.3 trillion dollars, about 25% of what it annually spends. At the time this amounted to a cost of “$8,000 for every man, woman, and child in America”.

$2.3 Trillion Missing from Pentagon

This problem has only grown worse over the years. In 2017, Michigan State University scholars found $21 trillion in unauthorized spending in the departments of Defense and Housing and Urban Development for the years 1998-2015. Given that the entire Army budget in fiscal year 2015 was $120 billion, unsupported adjustments were 54 times the level of spending authorized by Congress.

21 Trillion in Unaccounted Spending

This $21 Trillion in wrongful “adjustments” is more than all the money in the entire US economy.

In 2015, the Defense Department’s Inspector General report listed $2.8 trillion in wrongful adjustments in just one quarter alone and a total of $6.5 trillion for the year.

And it is not just the Department of Defense that can’t account for trillions of dollars but also other agencies like the Federal Reserve.

9 Trillion Dollars Missing from the Federal Reserve

The government can’t account for trillions of dollars. No one in charge of our tax dollars seems to be able to figure out how much money is being spent, what the money is being spent on, or who has been receiving the payments.