The $2.3 trillion 'missing' thing.

[JAStewart]

Was this announced BEFORE Bush & Co announced their first budget? If so.. then wouldn't it be Clinton's fault?

[WildCat]

Was this announced BEFORE Bush & Co announced their first budget? If so.. then wouldn't it be Clinton's fault?
It would have to go back quite a ways - $2.3 trillion represents over 5 years of the entire US military budget, and 1/5 of the entire US GDP.

The story is hogwash.

[JAStewart]

But Donald Rumsfield admitted it didn't he?

[gumboot]

What's the actual quote?

I got the impression it was more to do with the fact that The Pentagon is trying to run on very inferior and out-dated systems, such as an accounting system that wasn't capable of accurately tracking $2.3 trillion.

-Gumboot

[Cylinder]

Yes and no.

The figure (http://www.cbsnews.com/stories/2002/01/29/eveningnews/main325985.shtml) was cumulative and had to have stretched back over a variety of administrations. To illustrate, the 2001 total Federal Budget was $1.8 trillion USD - of which only $296 billion was allocated to DOD. That should put the figures in scale.

[Cylinder]

Here (ttp://www.gpoaccess.gov/usbudget/fy01/pdf/hist.pdf) are some GPO budget tables that stretch back to 1789. They were prepared in anticipation of FY2001.

[Hutch]

The problem is with what Rumsfeld SAID and what folks think they HEARD.

What he said (per this site--http://www.cbsnews.com/stories/2002/01/29/eveningnews/main325985.shtml was:

According to some estimates we cannot track $2.3 trillion in transactions," Rumsfeld admitted
bolding and italics mine.

It is not that the money was stolen, or hidden away, or used for some nefarious purpose. It says they could not track it, could not provide the accounting and billings for where the dollars went.

I work on a program that I have to track about $500M, which takes several people to do over many years and even then I probably could look at a record and wonder where some fo the money went. LIke yourself, you may budget, say, $a,500 for eating out a year, but I doubt you could track how much was spent at Burger King and how much at Subway.

The money got spent; we (the USG and especially the DoD) do not do the best tracking job in the world; part of the reason is that all the Services have their own accounting and finance and procurement and everybody does it differently.

Also, during times of War (I presume, given the amount, that this goes back to WWII at least), the issue is getting things done and don't worry about the books, we'll settle those when the war is over..which never gets done.

There is a lot worth criticizing in the way the Pentagon spends money; but that is due to Bureaucratic FUBAR rather than some foul plot(s) against the people of the US--or at least until I see better evidence than one quote.

JIMHO as always...

[JAStewart]

So could have meant to say 2.3 billion? I see what you mean by the perspective with, 2.3 trillion is seriously too much money to lose.

[Cylinder]

There is a lot worth criticizing in the way the Pentagon spends money; but that is due to Bureaucratic FUBAR rather than some foul plot(s) against the people of the US--or at least until I see better evidence than one quote.

Though I'm certain you would factor some non-trivial and bi-partisan amount of graft and corruption into that assessment, right?

[chippy]

All it means is that the Pentagon has spent $2.3 trillion over the last several years and has not kept accurate records of where it has gone. That's why he proceeded his comment with "according to some estimates" because obviously he has no idea how much has been lost!

[orphia nay]

According to Wikipedia, these are the departments within the Pentagon:

Office of the Secretary of Defense
Defense Policy Board Advisory Committee
Office of Net Assessment
Office of Inspector General
Defense Criminal Investigative Service
Military Departments
Department of the Army including the U.S. Army
Department of the Navy including the U.S. Navy and U.S. Marine Corps
Department of the Air Force including the U.S. Air Force
Joint Chiefs of Staff
United States Naval Observatory
Unified Combatant Commands
Central Command (CENTCOM)
European Command (EUCOM)
Joint Forces Command (JFCOM)
Northern Command (NORTHCOM)
Pacific Command (PACOM)
Southern Command (SOUTHCOM)
Special Operations Command (SOCOM)
Strategic Command (STRATCOM)
Transportation Command (TRANSCOM)
Defense Agencies
Defense Advanced Research Projects Agency
Defense Commissary Agency
Defense Contract Audit Agency
Defense Contract Management Agency
Defense Finance and Accounting Service
Defense Information Systems Agency
Defense Intelligence Agency
Defense Legal Services Agency
Defense Logistics Agency
Defense Security Cooperation Agency
Defense Security Service
Defense Threat Reduction Agency
Missile Defense Agency
National Security Agency
National Reconnaissance Office
National Geospatial-Intelligence Agency
Pentagon Force Protection Agency
Department of Defense Field Activities
American Forces Information Service
Defense Prisoner of War/Missing Personnel Office
Department of Defense Education Activity
Department of Defense Dependents Schools
DoD Human Resources Activity
Office of Economic Adjustment
Tricare Management Activity
Washington Headquarters Services


Those are all huge departments, to say the least. For the Pentagon to 'track' all the spending within them would be an insurmountable task, given, as Gumboot says, the inferior accounting systems, let alone a futuristic accounting system.

Working for (state) government departments, I am certain the Premier's office would have no idea, for example, how many staples I bought with my stationery budget one week 5 years ago. That's analagous to what twoofers expect when they demand of Rumsfeld the receipts for some thermite on the weekend before 9/11.

[Mashuna]

Yes and no.

The figure (http://www.cbsnews.com/stories/2002/01/29/eveningnews/main325985.shtml) was cumulative and had to have stretched back over a variety of administrations. To illustrate, the 2001 total Federal Budget was $1.8 trillion USD - of which only $296 billion was allocated to DOD. That should put the figures in scale.

I must admit I'm still amazed by the scale of the whole thing. I audit in the UK, local govenment and hospitals. The annual budget there is nothing like the DOD, but still several hundred million pounds per year (so approaching $1 billion).

We always test selections of items from the I&E and Balance Sheets back to individual invoices / approvals. I've never seen anything approaching the problems reported here.

I guess there are two main differences. One, I've no idea what the US regulations are like with regard to government audit. Two, I know that the increased scale does make a large difference. I don't do any central government audit, but I know (as an example) that Customs and Excise accounts have been qualified every year for a number of years.

Still seems like a lot of money to lose track of though :)

[gumboot]

I must admit I'm still amazed by the scale of the whole thing.


We don't know the sort of time period we're talking about, however.

I think Orphia Nay raised a good point. We're probably talking about a scenario where the CO's office at Air Base X spent $3,000 on stationary in 2002 but they don't know how much was spent on paper, how much on pens, and how much on staplers.

If you consider little things like that happening over the last 60 years in an organisation with a staff of two million or so, it's not actually that huge an amount (to use the example figures I gave, that would work out at less than $20 per person per year in unknown expenditure).

Then consider how much of that lost expenditure was directly related to waging war (when I imagine auditing of expenses takes second place to completing the mission)?

-Gumboot

[T.A.M.]

Lets look at it this way. If Rumsfeld was part of the grand Cabal of the PNAC/NWO, and they were trying to rape the tax payers of 2.3 Trillion, for what ever purpose, would he then come out and in public say "We are missing 2.3 Trillion"? No of course not, so however it is missing, it was not taken by Rumsie and crowd for PNAC/NWO, unless they are the most stupid lot in all of history.

TAM

[The Doc]

In all honesty losing $2.3 trillion isn't exactly dropping 5 cents under the till at McDonalds. Someone would look into it if that much money was missing. It would be a huge issue.

Which would obviously make people say "but it's being covered up by the NWO". But in the end, like TAM said, why would you say its missing if you were covering it up.

[WildCat]

In all honesty losing $2.3 trillion isn't exactly dropping 5 cents under the till at McDonalds. Someone would look into it if that much money was missing. It would be a huge issue.

Which would obviously make people say "but it's being covered up by the NWO". But in the end, like TAM said, why would you say its missing if you were covering it up.
The money is not "missing", it simply hasn't been accounteed for in great detail. For instance, suppose some office was redecorated at a cost of $15,000. It is known the money was spent on the office remodel, but how much was for electrical work, how much for carpentry, how much for carpet, how much for furniture, etc. is not known.

[The Doc]

The money is not "missing", it simply hasn't been accounteed for in great detail. For instance, suppose some office was redecorated at a cost of $15,000. It is known the money was spent on the office remodel, but how much was for electrical work, how much for carpentry, how much for carpet, how much for furniture, etc. is not known.

I agree with you :)

I was addressing that to the people that will tell you the money is "gone" or "missing".

[gumboot]

But in the end, like TAM said, why would you say its missing if you were covering it up.


Because you know that if you admit it's missing no one would ever suspect you stole it in the first place.

Those crafty devils. They're laughing at us!

Laughing I say!

-Gumboot

[gumboot]

I agree with you :)

I was addressing that to the people that will tell you the money is "gone" or "missing".



Maybe it was a clever ruse by the USA to intimidate their enemies. As in:

"Look, we spend so much money on Defence we lost $2.3 trillion and we don't even care. Heck, the Marines spend that on strippers at New Years!"

-Gumboot

[Mashuna]

The money is not "missing", it simply hasn't been accounteed for in great detail. For instance, suppose some office was redecorated at a cost of $15,000. It is known the money was spent on the office remodel, but how much was for electrical work, how much for carpentry, how much for carpet, how much for furniture, etc. is not known.

That sounds like reasonable speculation, but I can't tell if that's actually what's happened (I'm only going on the information contained in the link from post #5).

Who actually audits the DoD, and are their reports available online? I see the Defense Finance and Accounting Service are the finance agency, is there another agency that audits them, or are they it (apologies for my lack of knowledge of the US system)?

[PerryLogan]

Trust me, we Americans can beat you in the ignorance department anytime.

From the point of view of conspiracy theories, TAM hits the nail on the head:
If Rumsfeld was part of the grand Cabal of the PNAC/NWO...would he then come out and in public say "We are missing 2.3 Trillion"? No of course not...."

Truthers apparently can't see the absurdity of their scenario. They really think the bad guys admit everything--but no one notices it but they!

[Bell]

"Before I vill kill you, herr Bond, I vill zell you how I plan zo take over ze welt."

[Mashuna]

Maybe it was a clever ruse by the USA to intimidate their enemies. As in:

"Look, we spend so much money on Defence we lost $2.3 trillion and we don't even care. Heck, the Marines spend that on strippers at New Years!"

-Gumboot

Now that sounds like a party!

[jujigatami]

I work in Expense management. I run a software company that sells expense management software.

You'd be AMAZED at how poorly most companies expense tracking is. From everything from lunches to serious capital expenditures.

One company we worked with actually LOST over a million dollars in airline tickets. How? you ask. Well, employees would book a ticket weeks in advance, and then the trip would be cancelled. NO ONE would get the ticket refunded. The employee assumed that the tracel agent got the refund, the TA assumed the accounting dept got the refund. This company lost over a million dollars a year on this, it happened for YEARS, and no one ever noticed.

Also, in my sales kit I have an article written about government personell expense tracking. Its hillarious (I don't have a link though). It seems that for the government to process expense reports it was costing hundreds of dollars per report. So the government basically decided not to process expenses anymore and just pay the corp. cards. They decided that the fraud would be less than the cost to keep people honest. Well, employees bought cars for their wives, some remodeled their houses, one guy bought a stuffed moosehead.

No one ever checked, and to my knowelege, no one was even reprimanded.

After seeing this, the government not being able to track a few trillion here and there sounds downright eficient.

[rwguinn]

The money is not "missing", it simply hasn't been accounteed for in great detail. For instance, suppose some office was redecorated at a cost of $15,000. It is known the money was spent on the office remodel, but how much was for electrical work, how much for carpentry, how much for carpet, how much for furniture, etc. is not known.You also need to mention "Black Projects", for which not only is the project hidden from public and other oversight, the money is spent in ways that are hidden.
Some of "Star Wars", the Manhatten Project, Los Alamos Labs in the early 1940's, the SR-71--all were Black at some point, and they absorbed a lot of money

[JamesB]

The money wasn't lost, they simply couldn't track what it was spent on after the fact. The DoD finance system seriously sucks. I have had to wait as long as 8 months to get paid for my travel vouchers, it is ridiculous. Ironically the whole point of Rumsfeld bringing this up was to complain about it to a conference of Defense Department logisticians. He didn't cause the problem, he wanted to solve it.

I did a fairly detailed post on this on SLC.

http://screwloosechange.blogspot.com/2006/11/missing-trillions.html