Target Fraud, Waste, & Abuse: The Pentagon
Last week, I listened to a jaw-dropping episode of one of my favorite podcasts, Search Engine. I know that wars are expensive and that the Pentagon has a bloated, unchallengeable budget that includes a lot of waste. Host P.J. Vogt’s interview with Linda Blimes (below) enables listeners to discuss that waste with great particularity. The title of this post references the mantra of the so-called Department of Government Efficiency (DOGE), tasked with ferreting out waste, fraud, and abuse.
DOGE no longer exists, but its employees have now been embedded in other agencies, and they continue their mission under the radar. DOGE claims to have saved the government $215 billion, but that number may not mean anything. Right from the start, DOGE’s claims were unreliable, and they likely have not become any more reliable now that nobody is paying attention to DOGE’s claims. We addressed the unreliability of DOGE’s claims of savings previously here. Even before the war, which is the subject of the Search Engine episode summarized below, overall spending increased during the Trump administration by four percent, according to Kevin Kosar of the American Enterprise Institute. Revenue increased due to tariffs, which contributed nearly $200 billion to the federal coffers, but most of that money has to be returned.
That leaves the country with a $1.8 trillion debt, to which $3.4 trillion is expected to be added as a result of the One Big Beautiful Bill Act, according to the Committee for a Responsible Federal Budget. Meanwhile, the administration is proposing $200 billion in emergency spending to pay for the war in Iran, which is not a war and which we already won. On top of that, the government will seek to increase the budget for the Department of Defense (DoD) from $1 trillion to $1.5 trillion. So, if you are serious about cutting the federal budget, there might be some fat to trim in the DoD.
I recommend the episode to my readers, but here are some takeaways:
Professor Blimes begins with a simple observation. We easily overlook the vast differences between millions and billions and trillions because the words rhyme. A million second ago was still 2026. It was still April. It was 11.6 days ago. A billion seconds ago gets us to 1979. A trillion second ago puts us in the Stone Age. Think about that when DOGE and its epigones crow about saving millions or even a few billions but the administration behind DOGE contemplates a $1.5 trillion dollar annual defense budget.
Professor Blimes then compares the government to a shady moving company that quotes one price and then increasing the price once they have your earthly possessions. When the war starts, the government quote a lowball price, based on sunny optimism or, in the case of of the current war in Iran, based on little apparent thought about how Iran might respond to the U.S. attack.
The first steps are emergency appropriations, like we have seen already in connection with the war in Iran. Emergency appropriations are well suited for truly unforeseen events, like a hurricane or an earthquake, but once a war gets going, the government relies on emergency appropriations to cover known costs without affecting core budget projections. For example, according to Professor Blimes, ten years into the Iraq War, we were still relying on emergency appropriates to cover 400 bases in Iraq and the hundreds of thousands troops stationed there.
Okay, fine, but all that money is accounted for. Right?
In fact, according to Professor Blimes, The DoD:
has flunked its audit every year since accounting was required for federal agencies and is the only federal agency that has done so. . . . They cannot account for at least 50% of their assets around the world. The GAO, the Nonpartisan Government Accountability Office, ranks the lack of financial accountability at the Pentagon among its top risks of government every single year, for years and years and years.
Our financial systems are decades old. According to some estimates, we cannot track $2.3 trillion in transactions
Okay. That’s not good. But how are we funding this agency that loses trillions of dollars and cannot account for it?
We used to do so by raising taxes. So wars hurt. President Wilson raised corporate taxes from 1 percent to 12 percent to pay for World War I. According to Professor Blimes, “President Truman raised top marginal tax rates to 92 percent,” and “President Johnson imposed a tax surcharge to 75 percent, top rates.”
Now, we just take on debt, and the debt that we take on gets more expensive to pay back as interest rates rise. According to Professor Blimes’ estimates, the Iran and Afghanistan wars cost the U.S. between $5 and $6 trillion, and a separate group at Brown University estimates the costs at $8 trillion. What did those wars get us?
According to Search Engine, we could have used that money to pay for free education at American universities for a century. Instead of an educated work force, we exposed a generation of U.S. troops to toxins and contaminants and many of them now qualify for lifetime disability benefits and medical care which add an additional $7.3 trillion to the ledger.
The costs in the current war are shockingly asymmetrical. The Iranians launch drones at us, which cost them up to $30,000 each. We respond with interceptors that cost up to $3 million each. As of today, Professor Blimes estimates that the war in Iran will cost at least $1 trillion. Search Engine points out that $1 trillion would fund free school lunch for every K through 12 student in America for over 40 years.
But if the government wanted to do something flashier, it could take $1 trillion and buy every single sports team in the NFL, NBA, MLB and NHL. It would then have about $500 billion leftover, which could be used to fund NASA for 20 years.
Or perhaps the money could just be used to provide lifetime healthcare and housing for every veteran who came home damaged by the war.
Stop fraud, waste, and abuse. Stop the hypocrisy. If you are really interested in curtailing government spending, look at the agency that spends the most and cannot account for its expenditures. And while you’re at it, stop wars without objectives. They kill innocent people and destroy things that are both beautiful and useful. And they cost each and every one of us a lot more money than DOGE claimed to have saved us.