At least $276.64 billion of taxpayer money was wasted in 2022. There’s no real accountability from the government to the customers, the American people.
No one should be surprised that the government has horrible customer service. It wastes resources, steals your resources, and does stupid and wasteful things with them.
Meanwhile, 54% of Americans today believe their federal income taxes are too high. Yet the United States is one of the least taxed among developed nations.
How the U.S. Compares to Other Nations
Tax revenue in America accounts for a little more than a quarter of the country’s GDP. This compares to an average of 34.11% among developed countries.
Particularly compared to other Western European democracies, our taxes are relatively low. Taxes are a matter of perception and how people feel about the value they get for what they pay.
Only about 20%, really more like 18%, of government spending is on what most people expect. In the private sector, businesses determine costs based on what they sell.
In the federal government, the approach is different. If spending doesn’t work, they just spend more.
The Scale of Government Waste
Billions of taxpayer dollars go to waste every year. Improper payments alone cost the U.S. $276.64 billion in 2022.
Over the last two decades, the U.S. government has lost almost $2.69 trillion in payment errors. These include both overpayments and underpayments.
Overpayments can be fraudulent, go to ineligible people, or even be sent to the deceased. Most people wouldn’t tolerate losing money this way, yet the government drops trillions.
Shocking Examples of Waste
Oversight reports claim billions of dollars are wasted annually. This includes spending $1.9 billion maintaining empty government buildings.
Another example is $31.36 million spent on forest camouflage uniforms for the deserts of Afghanistan. Duplicated programs are another major issue.
The Government Accountability Office finds duplicative programs every year. For example, there are 133 broadband programs across 15 federal agencies.
The government spent $47.04 billion on broadband in three years. Yet, many people remain unconnected.
Federal Spending and Deficit Growth
Federal spending has risen over 20% since 2019, even after adjusting for inflation. In 2022, the federal budget deficit reached $1.54 trillion.
That same year, the national debt hit almost $34.72 trillion for the first time in history. As the government runs up deficits, it mortgages America’s future.
The national debt equals about $280,000 per household. This sucks investment out of the economy and slows growth.
Tax Fairness and Public Perception
Taxes have never felt more unfair in the U.S. The ultra-wealthy have increased dramatically in numbers.
They also have more ways to avoid taxes. It’s not just about the rate but the loopholes that allow them to pay less.
The top 1% of earners paid more than 42% of federal personal income taxes. That sounds fair, but they also benefit from significant tax breaks.
A 2021 analysis showed the wealthiest 400 billionaires paid an average tax rate of 8.2%. This is much lower than the rate paid by average working Americans.
Lack of Visible Returns
Americans feel they aren’t seeing enough returns for their taxes. The U.S. has lower taxes compared to other developed countries.
Yet, citizens pay extra for many essential services. In 2019, out-of-pocket health spending per capita in the U.S. was $1,382.2, compared to $687 in other OECD nations.
Tuition fees for bachelor’s degrees are also significantly higher. Most taxes go to Social Security and Medicare.
We finance our own retirement and medical care throughout our lifetimes. Other countries build these costs directly into their tax structures.
Covid-19 and Government Waste
Covid-19 exposed massive government waste. In March 2020, Congress passed bills to keep the economy afloat.
Massive government spending opened the door for fraud and abuse. Estimates suggest hundreds of billions, possibly trillions, were wasted in three years.
The rush to distribute funds used weak systems. There was little oversight or accountability.
The Role of the Government Accountability Office
The Government Accountability Office (GAO) audits federal spending. It identifies agency mismanagement and errors.
GAO reports highlight high error rates and inefficiencies. However, government action to fix these issues is inconsistent.
Some suggest increasing funding for oversight agencies. These agencies often recover $7 to $8 for every dollar spent on investigations.
Solutions to Curb Wasteful Spending
Accountability in government spending is severely lacking. There’s no real penalty for misspending money.
Congress fails to enforce accountability in new legislation. Many suggest shrinking the federal government’s responsibilities.
Cutting unnecessary programs or privatizing them could help. Often, private solutions are more efficient.
For example, helping 500 homeless individuals should be a simple cost calculation. Yet, the government sometimes spends $896,000 per unit on housing programs.
The Need for Congressional Action
Experts say Congress must take responsibility. They need to act on waste reports and implement real reforms.
Without Congressional action, government inefficiency will persist. At the end of the day, Congress must respect taxpayers by fixing wasteful spending.