Pentagon Plays Hide and Seek With Trillions of Your Tax Dollars

After years of protesting that they were “too big to audit,” the Pentagon is finally under a congressionally-mandated review. Under a law passed in 2009, the Pentagon must provide their financials to Congressional overseers by September 30, 2017.

However, a new report published by the Pentagon’s Office of Inspector General (IG) highlights how problematic the Pentagon’s books truly are. The IG now believes there is “considerable risk” that the Pentagon will not be audit-ready by the date mandated by law.

And, really, it’s more than just a simple problem. To borrow a Trumpism, it’s a YUGE problem. In fact, according to the Pentagon, the U.S. Army has trillions of dollars in accounting errors in their books. Yes, trillions. These errors are based on missing receipts and invoices, or statements that literally just don’t add up.

Reuter’s Scot Paltrow found that the Pentagon didn’t simply misplace a few receipts, nor was it as simple as offering an Accounting 101-style refresher. Instead, Paltrow concludes, that the military was forced to “make trillions of dollars of improper accounting adjustments to create an illusion that it’s books are balanced.”

As the report highlights, we’re talking about insane bookkeeping flubs. In fact, the Pentagon fabricated nearly $2.8 trillion ledger entries in just the third quarter of 2015; overall, $6.5 trillion in fabricated entries for the year. The evidence is damning; such poor mishandling will put additional scrutiny on defense spending, the largest expenditure in the discretionary budget. As can be expected, it will be difficult for the military to justify needed resources when, in fact, the Pentagon admits:

[F]inancial statements were unreliable and lacked an adequate audit trail. In addition, DoD and Army could not rely on their accounting system data when making management and resource decisions.

How could this happen?

Part of the problem begins with the culture of military support in Washington. For years, military spending has been a sacrosanct topic. Politicians are often reluctant to question or challenge the ever greater need for military resources; it is a subject that can immediately make a politician look weak on national security.

Today, the military spends roughly as much as it did during the Cold War era, or at least, during the Reagan defense buildup. All told, including war funding, the military will cost the U.S. taxpayer roughly $586 billion this year.

To truly put the size of our defense budget into perspective, it is often helpful to compare it to, well, the resources of other nations – particularly those who may be foes. As you can see in the chart, we crush everyone in military might; or at least when it comes to buying military hardware.

The inability of the Department of Defense to manage their own budget is an affront to the American taxpayer, as well as to the troops the DoD oversees. Every few months a new story develops where the military has literally lost billions of dollars. For example, in April of 2015, the military was accused of losing $45 billion in Afghanistan.

That’s nearly as much as the federal government provides to build our nation’s roads, each year. Taking taxpayer funds for granted; squandering them, or losing them is a disservice to the American people. Yet, that is not even the most unfortunate aspect.

Most concerning is what this means for the fate of U.S. Military might in the future. The federal government is cash strapped, with $19.5 trillion in debt, and a social safety net that is consuming the federal budget. As a result, each dollar sent to the DoD will be under greater and greater scrutiny.

Even the Pentagon realizes that asking for additional funds to build up the military is unrealistic when they fail to account for the resources they currently have. In their Future Years Defense Program (FYDP) proposal, a five-year defense budget, the Pentagon has effectively asked for flat funding, or, on average, $534 billion per year through 2020.

In fact, instead of expanding the military, the Pentagon is already looking for new savings. Plans are in place to reduce the number of active duty troops, from 1.31 million to 1.27 million. The Pentagon also would like to reform military pay and initiate a new round of base realignments and closures.

The U.S. military is the best in the world. Men and women throughout our history have sacrificed their lives to protect the freedom we cherish, even as they seek to liberate other lands from tyranny and terror. However, the means to achieve these heights should not be abused. The sacred honor with which our troops commit themselves should not be disregarded and shamed by an organization that squanders the pledges of U.S. taxpayers. Each dollar committed to our national defense should be treated with respect, and with purpose. Anything less tarnishes the honor of our troops, and the costs which they have so bravely borne. (For more from the author of “Pentagon Plays Hide and Seek With Trillions of Your Tax Dollars” please click HERE)

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