GAO Report On Government Waste Has Nothing New

In its first annual report to Congress, called “Opportunities to Reduce Potential Duplication in Government Programs, Save Tax Dollars, and Enhance Revenue” the Government Accountability Office argued that the federal government could save several billion by eliminating many programs and agencies which overlap one another.

The 345 page report says:

GAO’s simulations show continually increasing levels of debt that are unsustainable over time absent changes in current fiscal policies. The objectives of this report are to (1) identify federal programs or functional areas where unnecessary duplication, overlap, or fragmentation exists, the actions needed to address such conditions, and the potential financial and other benefits of doing so; and (2) highlight other opportunities for potential cost savings or enhanced revenues

The analysis focuses on agriculture, defense, economic development, energy, general government, health, homeland security, international affairs, and social services. “Within and across these missions, this report touches on hundreds of federal programs, affecting virtually all major federal departments and agencies,” the report concludes. The theory behind the value of the analysis is that elimination of duplication will save taxpayers billions of dollars. But, the GAO says its analysis in not comprehensive and does not “represent the full universe of duplication, overlap, or fragmentation.”

As expected, politicians  expressed support for the GAO’s conclusions. Any document which covers cost cuts and comes from a reputable source gives members of Congress a convenient way to blame federal deficits on the government’s structure rather than spending on the largest programs like Social Security.

The use of the GAO report as a potential solution to government financial imbalances is flawed. The main reason this is true is that the analysis in the report uses “simulations.”  These are only as good as the data used to create them. The GAO would naturally claim that its information is better than any other. There is no evidence that this is true beyond the GAO’s own claims.

The other major flaw of the report is the contention that overlapping programs can be easily eliminated. It is too bad that the process is not simple. It would take months or perhaps years to identify the duplications one by one. There would have to be a higher power to decide which programs would go and which would stay. A misstep in program elimination would disrupt government services. The details of dismantling portions of the massive federal infrastructure are beyond the capacity of any audit and analysis system in place now. The army of auditors needed to handle the GAO recommendations would number in the thousands.

The GAO report does have  value. Its conclusions are not new, but they are useful. Waste is at the heart of much of the deficit. But, the only way to address that is to cut spending. The battle over the deficit is based almost exclusively on this sensible idea. A solution which is based on a thousand cuts is beyond even the most sophisticated approach.

Douglas A. McIntyre