Posted on 07/10/2002 1:08:30 PM PDT by Jean S
(July 10, 2002 2:05 p.m. EDT) - As members of Congress make political hay with corporate America's accounting scandals, their own financial mismanagement continues to dwarf those companies they excoriate.
While securities regulation and criminal justice bring corporate culprits to justice (raising the question of whether more laws are really necessary), Congress violates its own management rules and standards on a daily basis.
Congress annually passes supplemental spending bills to circumvent budget caps, calls them "emergency" spending bills and says the expenditures do not count against the budget totals for the year. Over the past five years, lawmakers have spent a total of $142 billion above the levels in the corresponding budgets. That's more than 12 times the misstated figures from Enron, Xerox, and WorldCom combined.
While states prohibit private sector firms from siphoning off pension trust funds for non-pension spending, there is no such restriction at the federal level. In fiscal 2000 and 2001, the federal government increased total debt to another record high while claiming a surplus. They took Social Security and other trust fund money worth $189 billion in 1998 and $228 billion in 1999 to cover general government operational deficit spending. For 2000 and 2001, they stole another $463 billion from the various trust funds, of which $272 billion came from Social Security.
Just a small sampling of accounting "errors" in the federal government reveals more than $20 billion in improper payments made annually, about $12.1 billion through Medicare alone. That money, which officials make little effort to reclaim, will not provide prescription drugs or other services for senior citizens.
There are laws requiring financial accountability that Congress routinely ignores, such as the Chief Financial Officers Act and the Government Performance and Results Act. For the past five years, the General Accounting Office has been unable to issue an opinion on the government's consolidated financial statements because of certain material weaknesses in internal control and accounting and reporting issues. "These conditions prevented us from being able to provide the Congress and American citizens an opinion as to whether the consolidated financial statements are fairly stated in conformity with U.S. generally accepted accounting principles," the report stated.
Meanwhile, senators and representatives circumvented the fiscal budget and authorizing process to earmark $20.1 billion in hometown pork projects, including $2 million to restore the Vulcan Statue in Birmingham, Ala., and $50,000 for a tattoo removal program in San Luis Obispo, Calif. These raids on our money go unpunished.
Even worse, failing programs don't disappear. They get more money. A recent example is the Youth Offenders Eligibility Awards. Originally intended for offenders 25 and under, at a rate of $1,500 per individual, the program was duplicative, underutilized, and slated for termination in the president's 2003 budget. Rather than get the hint, Sen. Arlen Specter, R-Pa., decided to increase the award amount to $2,500 and increase the eligibility age to 35, adding another 481,000 prisoners. All this was part of a supplemental appropriations bill intended to increase funds for the war on terrorism.
The government's exposure to additional costs and potential losses spreads beyond the obvious programs to government-sponsored enterprises and quasi-governmental entities.
For example, the U.S. Postal Service is $13.5 billion in debt and raised stamp prices to 37 cents on June 30; it provides a priority mail service that is often slower than first class mail. Amtrak has cost taxpayers $39 billion in 2001 dollars since its inception and has increased its debt from $1.7 billion to $4.4 billion over the past five years. Unlike WorldCom or Enron, Amtrak need not fear bankruptcy; the railroad will just drain more money from taxpayers and avoid reform. Government-backed mortgage giants Fannie Mae and Freddie Mac are two of the largest companies in America, yet they are exempt from the Securities and Exchange Commission's disclosure rules.
The bad players in the private sector usually get their due - they get fired, go out of business, or go to jail. But Congress has an ace in the hole that allows them to vote themselves largess, violate their own rules, use taxpayer money as legalized bribery to get themselves re-elected and never face the bottom line.
Complaints about losses in companies ring hollow when the real accounting deception affects every American as a shareholder in the U.S. government. While the losses in the private sector are real, at least investors and workers were able to divest or quit when the malpractice became apparent.
Tom Schatz is president of Citizens Against Government Waste.
Congress has oversight responsibilities. The SEC has oversight responsibilities.
Congress has investigatory powers. The SEC has investigatory powers.
The big difference is that one could argue the SEC has done a $#@# of a lot better job that Congress has. And considering that Congress has oversight over the SEC, if the SEC wasn't up to snuff where the devil was Congress? Trust Congress to deal with this mess? I'd sooner let the PRC deal with it. They're more efficient. And that's not saying much, is it?
"It has a little over 500 employees with the following statistics:
29 have been accused of spousal abuse
7 have been arrested for fraud
19 have been accused of writing bad checks
117 have bankrupted at least two businesses
3 have been arrested for assault
71 cannot get a credit card due to bad credit
14 have been arrested on drug-related charges
8 have been arrested for shoplifting
21 are current defendants in lawsuits
In 1998 alone, 84 were stopped for drunk driving"
This is beyond "politics as usual". The Republicans voted for policy that helped us financially in the 90s...they didn't work to undermine our economy simply to hurt Clinton, nor would they. The Democrats with the help of the press are working to destroy our President and our economy during wartime. Benedict Arnold was a Boy Scout by comparison, imho.
Time to throw both parties out of DC, they are both beyond hope.
If the politicians and bureaucrats were held accountable like the private sector is for cooking the books most of our government leaders would already be behind bars.
Also, if a private sector company was run like government -- funding itself with the extortion-barrel of a gun -- the private sector CEOs would all be in jail. Come to think of it, the government has created so man laws that virtually every citizen is a lawbreaker. Yet despite all those law breakers people and society continue to prosper.
Despite power-usurping politicians and self-serving bureaucrats that create and implement 3,000 new laws each year -- "must have" laws they and the media tell us that without them people and society would run headlong into destruction -- people and society continue to increase prosperity.
How ever did we all manage to do so well for years and decades without having next year's do-or-die, must-have laws or the laws that will come the year after next and the years to come?
Reality is, politicians and bureaucrats are parasites and the workers of the world are the host. Without our work ethics they would perish, -- without their ethics of parasitism the workers of the world would flourish almost beyond imagination.
John Stossel makes a powerful point.
There was a highly effective life-saving drug that the FDA held off the market despite it being successful used in several European countries. For a year, FDA red tape kept the drug from being available in United States.
Stossel continues, last year seven thousand peopled died from "XX". Doesn't that mean that the FDA killed seven thousand Americans last year?
That one example is a snowball-size tip of the iceberg. Seldom do each year's three thousand new laws protect prosperity yet they often destroy prosperity.
The War of Two Worlds
Value Creators versus Value Destroyers
When Geppy tried to explain how Bush's plan did not go far enough (concerning actions regarding corporate fraud) and attempted to talk about how marvelous the dem plan was.....Neil stopped him short.
Neil bluntly asked Geppy if more rules were really the answer, if more bureaucratic crappolla wasn't really only going to make things worse.
Geppy got frustrated and said 'well right now we have the chicken guarding the hen house...er, I mean, the fox guarding the hen house' (lol) and so Neil said...AND I COULD HAVE HUGGED HIM FOR THIS....
" Well HOW is it going to be any better having congress guard the hen house....congress cannot handle its own budgets....mismanaging billions, losing track of the same, throwing money to pork projects etc." Geppy was stunned for a minute...then had to evade the question...very, very obviously. I loved it!!!!!!!!!!!!!!
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