America's Talking - White House Says $521 Billion Annual Federal Fraud Estimate ‘Not Plausible’

Episode Date: April 20, 2024

The White House Office of Management and Budget openly criticized a report from a Congressional watchdog that estimated the federal government loses up to $521 billion a year to fraud.  Jason Miller, the deputy director for management at the Office of Management and Budget, detailed OMB concerns in a 3-page letter to officials with the Government Accountability Office. He said the fraud estimate was "not plausible." Full Story: https://www.thecentersquare.com/national/article_36e9fdba-fccb-11ee-ad77-57171fd78925.html Support this podcast: https://podcasters.spotify.com/pod/show/america-in-focus/support Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Hello and welcome to America in Focus, powered by the Center Square. I'm Dan McAelham, chief content officer at Franklin News Foundation, publisher of the Center Square Newswire Service. We are recording this on Friday, April 19th. It's no secret that U.S. debt is out of control, with the national debt now approaching $35 trillion. New reports this week shed some light on how much fraudulent government spending contributes to that debt, and the International Monetary Fund issued a warning this week about U.S. debt and how it could be a lot. negatively impact international markets. Joining me to discuss this story is Casey Harper, Washington, D.C. Bureau Chief for the Center Square.

Casey, let's start with the fraud reports. What can you tell our listeners? Yeah, I mean, I can tell our listeners that what they always suspected about the federal government has, is even worse than they may have thought. I think Americans have a general sense that the federal government is wasteful and misuses money. It's inefficient. But some of these recent reports, the data on these improper payments found that the federal government has lost to federal fraud as much as half a trillion dollars annually, right? Which is a staggering figure. The White House immediately came out and said that figure, it's not plausible, it's not true.

But this figure did not come from a, you know, this figure did not come from Republican think tanks or something. This came from, you know, federal sources, a government accountability office, which is, you know, a federal watchdog that oversees many of the federal agencies like Medicaid, like Medicare, that send out checks, Dan. And that's really where this comes from. There are, the difference here in how the waste is so prolific is not because there's one or two, you know, bureaucrats who are, you know, taking the money to buy Porsches, which we have seen at state government and other levels. But this is because these are the government. the agencies that actually write checks to people and send them out, especially on a regular basis. And because of, you know, in particular, identity theft, because of, you know, organized crime, setting up accounts to receive these checks and getting going undetected for years, fraudsters are able to steal billions, with a B, billions of dollars from the federal government. There's also a problem with just accounting where the federal government pays too much to people and after the fact they realized they overpaid, and it's very difficult to get that money back if they even try or can do it at all.

And so, you know, this has also been compounded, Dan, by the pandemic, excuse me, COVID-era pandemic funding. When we saw a rush of federal spending, you know, we covered that at length on this show and at thecenterSquare.com about the stimulus checks, about all the extra federal benefits, unemployment, things that came out. during COVID. And that rush of spinning, the rush to get that money out the door was just gasoline on the fire of this fraud problem. So GOA report estimated that taxpayers lose between $233 billion and $521 billion annually. Brett Rowland. Roland has done some good reporting on this. So we're up to the, you know, half a trillion dollars a year, Dan. I guess is this the new, the new normal for the federal government? It's hard to use. even take in that kind of a number? I guess my thought on that question, Casey, is,

hasn't this been the new norm? It's not really a new norm. We're just really now starting to figure out how much fraudulent government spending there is. For all we know, this has been going on for, well, certainly there's always been fraud. But to this extent, maybe it has been to this extent for a while. One interesting tidbit that you mentioned the Center Square reporter Brett Rowland, who's done a lot of good reporting on this. If government fraud, government spending on fraud was its own government agency, meaning there's the Department of Defense, there's the Department of Health and Human Services, et cetera, if you add up all this fraud, and again, these are estimates. It could be much higher than this. We don't have a handle on all the fraudulent spending

that's going on in the federal government. But based on what we know, it would be the six largest agency in the federal government. That's staggering and sad at the same time. Yeah, yeah, it is. And you pointed out the estimates, the fact that we don't even really know is pretty ridiculous. I mean, you can imagine if your kid, your teenager, you know, got a credit, you had a credit card or something or used your credit card. And they ran up the debt and you asked them, oh, how much did you spend? And they said, well, between 50 and 100,000, it's like, well, you don't even know. you know, the fact that you don't even know how much you spent just shows a kind of carelessness.

This is not what you want to hear from the government. It's like, how much of money have you lost? Well, we can narrow it down within a few hundred billion dollars of the actual target. It's just kind of crazy to see that. As you said, it would be big as a federal agency. There are some, there is a legislative effort, bipartisan in the Senate, and a new bill was just introduced in the House by Representative Jamie Raskin, a Democrat and a Democrat and Maryland, who's on the oversight committee. He introduced a bill. There's a companion bill in the

Senate that has bipartisan support. They would really beef up some of the federal watchdogs. I think it's a good step. It could help, you know, without getting into the details. And there can be devil in the details on these kinds of bills. But, you know, I think it will help beef up the watchdogs give them more power to prevent the fraud and the waste instead of just always retroactively telling us how bad it was. So there is a little bit of movement trying to, uh, to do something about this. But right now, it's kind of an out-of-control problem. And the more we spend, and the worse it gets. And really, what's something to remember is all of this money we're spending and wasting is borrowed money. It's not like this was in the Treasury. So this is all borrowed money,

which means that half a trillion dollars we're paying interest on that, Dan. Yeah, it's all contributing to the out-of-control national debt, which, as I said, up top, is approaching $35 trillion. We'll get to $35 trillion. That's trillion with a T. probably this summer. And while there's been warnings about rising debt in the U.S. internally, this week, the International Monetary Fund warned the U.S. that increased government spending and that increasing national debt are not sustainable and will hurt the global economy. Just tell us a little bit more about that in a brief time that we have left. Yeah, I mean, the debt is rising at a breakneck pace. The U.S. credit rating has been recently

downgraded IMF is raising, you know, raising those concerns about the debt headed to 35 trillion. There was a, there's kind of been a new normal post-COVID. Before COVID, our deficits were not over a trillion dollars. During COVID, during the pandemic, we went well over a trillion, multi-trillion deficit. And then after COVID, there was kind of this idea that the deficits would go back down, but they really haven't gone back down to pre-COVID level. There's still over a trillion dollar. That was kind of a watermark we had managed to not pass. But now over trillion dollar annual deficits have become normal, unfortunately. And there doesn't seem to be any push either among Republicans or Democrats that is strong enough to actually, you know,

stop the runaway spending. Casey, thank you for joining us today. Listeners can keep up with this story and more at thecenter square.com. Attention, parents, teachers, and taxpayers. Do you care about the decisions being made in K through 12 public education. Do you want to know how those decisions impact your students and school district? Chalkboard News has you covered. We're delivering fact-based reporting on the policies that shape school safety curriculum and recovery from learning loss. At Chalkboard News, we're cutting through the politics and focusing on the facts behind the issues impacting students, teachers, and families. Get this news delivered to your inbox for free by signing up at chockboardnews.com.