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Investigation Reveals Efficiency of War Spending

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According to a report from the BBC the War on Terror has operated with a remarkably low level of loss to theft, accounting errors and waste of less than 1% since the start of conflict in Afghanistan; a level of spending efficiency which any successful business would be proud of. Out of a total expenditure for the War on Terror which currently runs almost $600 million a year, and has likely cost more than $2 trillion to date with more than another $2 trillion to come in the next 10 years, so far only a remarkably tiny $23 billion has gone missing, mostly in the hands of inefficient or corrupt local and international contractors.

Within the United States, the average level of corporate loss to retail businesses from theft, wastage and other causes is 1.7%, almost double the level of loss reported for governmental efforts in the War on Terror. This totals up to $46 billion annually, which adds up to more than 15 times the annual cost of loss and waste in the War on Terror. For another comparison, the federal budget is over $2.9 billion a year, of which Medicaid and Medicare account for about $600 billion a year. Those programs run at a loss rate from fraud and error as high as $220 billion a year, averaging about a 20% loss rate out of their budget. That's about 20 times more fraud and theft of taxpayer funds every year than we've seen in the entire War on Terror.

Since the summer of 2007, Rep. Henry Waxman (D-CA) of the House Committee on Oversight and Government Reform has been trying to draw attention to this situation,  holding hearings on some of the ways in which money has been spent in Iraq, and looking into issues of theft and waste; presumably in an effort to bring other government programs up to the same extraordinarily high standard of efficiency, and perhaps providing some government contractors like Halliburton with medals or other certificates of recognition in a nice public ceremony.

Fun with numbers.

For a different view of this issue see this article from Eurocritics Magazine.

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About Dave Nalle

  • http://www.indyboomer46.blogspot.com Baritone

    Hooray for war!

    B

  • http://www.associatedcontent.com/user/39420/joanne_huspek.html Joanne Huspek

    Baritone’s comment made me smile. Not that I like war or anything…

  • http://www.EurocriticsMagazine.com Christopher Rose

    Dave, as I have pointed out in the comments on the original article that inspired yours, it is pretty deceptive to depict the losses as being proportionately small.

    For a start, the actual expenditure on the Iraq Adventure 2 is $500 billion so the losses of $23 billion are much closer to 5%, far in excess of the retail losses rate.

    Furthermore, this vast sum, which could have gone half way to almost eliminate the grinding poverty in the world’s poorest countries, has been stolen by a relatively small number of corporate contractors, many of them supporters of the current US regime.

    I can’t find any sources to support your figure for the Medicaid budget but the cost seems more like $300 billion a year, not $2.3 trillion, so your entire point seems unsupported by the facts.

  • zingzing

    wait, what’s the total cost of the war right now? $500b or $2.4t? one article seems to state that it’s the former, and the total losses right now are $23b, meaning it’s nearly 5%, while the latter number is the total estimated cost by 2017… meaning there’s lots of time to steal more money.

    but then dave’s article seems to say that we’ve spent $2.4t… or at least he makes his .95% loss rate based on that number…

    so which is it?

  • http://www.EurocriticsMagazine.com Christopher Rose

    zingzing, my understanding is that the spend to date is $500 billion, giving “losses” of almost 5%; the total cost of the war could reach $2.4 trillion by 2017. Dave deliberately chose the latter figure in order to try and make his point. I believe the facts don’t really support his view.

  • zingzing

    well, i certainly don’t think it’s a valid way to get a statistic.

    so, dave… if i steal 5% of your money today, but you’ll make enough by 2017 that it will only be .95% in the future, will you prosecute?

    and how did you think you’d get away with that tomfoolery?

  • Joaquin Jimenez

    Without war, there’d be no 4th of July… No 16 de Septiembre to honor.

  • http://www.indyboomer46.blogspot.com Baritone

    I’m not sure where Dave came up with the 2.4t either. Even if you bundle both the Iraq and Afghanistan conflicts together the cost hardly reaches anything close to 2.4t. I have an ongoing counter on one of my blogs which has the current cost of the Iraq war at just over 560b. I have no figures for Afghanistan.

    If we have in fact lost 23b to date in Iraq, that is much nearer to a 4% loss. No matter how you cut it, it’s still a lot of cash in the pockets of a few, now very rich people.

    Also, as Christopher indicates, Dave’s Medicaid expenditure figures are suspect as well. I think he used the figures put out by his noted source, but went no further to substantiate the numbers. That’s not like Dave. Everybody be ready to duck. He’ll be back with scads of data to show us all what dumb asses we are.

    B

  • http://marksaleski.com Mark Saleski

    the bcc report comes to no such conclusion and in fact does not speak about the total cost.

    the cnn money article gets its figure from a projection ten years into the future.

    is this some kind of political performance art?

  • Clavos

    is this some kind of political performance art?

    Politics is “some kind of performance art”

    That’s what makes it fun…anyone can play, and it’s all relative; everyone’s opinion is as valid as everyone else’s…or no one’s opinion is valid. Take your pick – it works both ways.

  • http://www.republicofdave.com DaveNalle

    For a start, the actual expenditure on the Iraq Adventure 2 is $500 billion so the losses of $23 billion are much closer to 5%, far in excess of the retail losses rate.

    I didn’t say anything about Iraq in the article. I referred to the total cost of the War on Terror. That includes the DHS, military expenditures in Iraq, Afghanistan, Sudan, Pakistan and elsewhere. Military infrastructure support. Aid and support to our allies in the region. Increases in the budgets of the NSA, CIA and FBI associated with the War on Terror. The cost of maintaining prisoners. And on and on. Last year all of those expenses together topped out at about $600 billion if you take out the portion of the defense budget just needed to maintain the military during peacetime. Based on that, a total expenditure of $2 or $3 trillion since 9/11 seems conservative.

    Furthermore, this vast sum, which could have gone half way to almost eliminate the grinding poverty in the world’s poorest countries, has been stolen by a relatively small number of corporate contractors, many of them supporters of the current US regime.

    To be fair, the contractors in question are supporters of whatever regime is in power. For example, Halliburton contributed generously to the campaigns of both democrats and republicans on the lcoal and national level in the last two elections and in the current election.

    I can’t find any sources to support your figure for the Medicaid budget but the cost seems more like $300 billion a year, not $2.3 trillion, so your entire point seems unsupported by the facts.

    The 2008 Budget shows a total expenditure for medicaid/medicare of $600 billion for this year. Add in Social Security and welfare programs and it tops $1.5 trillion. Those mandatory spending items are the bulk of the budget. Everything else is almost trivial by comparison.

    But I did slightly misread the GAO document I referenced as a source. The percentage is of the total budget, not just medicaid, which is even MORE frightening. I’ll correct the article for posterity.

    Dave

  • http://www.indyboomer46.blogspot.com Baritone

    What’d I tell you?

    B

  • http://www.indyboomer46.blogspot.com Baritone

    But wait!!! Let’s look at Dave’s cited source:

    “A BBC investigation estimates that around $23bn (£11.75bn) may have been lost, stolen or just not properly accounted for in Iraq.” That’s 23 billion lost in IRAQ. It is clearly NOT an accounting of any and all money lost in the “war on terror.” Dave is STILL full of holes.

    B

  • http://www.republicofdave.com DaveNalle

    And for the record, the point of this ‘performance art’ is not excuse war profiteering, but to point out how grossly inefficient and susceptible to fraud our government is in other areas on a much larger scale, suggesting that more than just a genuine concern over waste or fraud is behind these investigations. If Waxman were serious he’d be investigating Medicaid.

    Plus, taking this approach to the subject struck me as amusing.

    Dave

  • http://marksaleski.com Mark Saleski

    right, now your point is different as well. sure thing.

    subterfuge won’t work.

  • Clavos

    If Waxman were serious he’d be investigating Medicaid.

    And Medicare. Which, according to an investigative report series recently published in The Miami Herald, is defrauded to the tune of $7 million daily, nationwide.

    But, it’s unlikely Waxman will do so, because those two programs are sacred cows, especially to liberal Democrats.

  • http://www.republicofdave.com DaveNalle

    Um Mark. When did my point change here? It’s still the same as it always has been. I’m sorry that you lack a sense of humor, really.

    Dave

  • http://www.marksaleski.com Mark Saleski

    you write an opinion piece that gets key facts (you remember facts?… the things you supposedly push in bc readers faces on a daily basis) completely wrong. then, when this is pointed out, you claim that the REAL point of the piece is to point out inefficiencies in other areas of goverment….which might be true if your first premise was true, which it is not.

    don’t turn this around on me. it’s got nothing to do with my sense of humor and you know it.

    the name of this post should be changed to “Investigation Reveals Dave Nalle Caught With His Pants Down”.

    believe me, i’d laugh at that.

  • bliffle

    IMO Daves point is that it would be more efficient to declare war on the old and the sick, rather than pay what we owe.

  • Clavos

    IMO Daves point is that it would be more efficient to declare war on the old and the sick, rather than pay what we owe.

    SATIRE

    While that would be unquestionably more efficient than housing and feeding them, it would be even more efficient and much less expensive to simply euthanize them when they become unable to care for themselves.

    For even greater efficiency and savings, the corpses should be rendered, much as we do now with barnyard animals, into useful forms such as fats for fuel, fertilizers, etc.

    This process would also prevent “dead-end” (pun intended) land usage for cemeteries; already established graveyards could be plowed over and turned into arable land.

    /SATIRE

  • Lisa Solod Warren

    Um, pardon me, Clav, and Dave. So is the piece satire or just Clav’s comments? Or just some of the comments by Dave and Clave. Depending on which facts they….. oh what the hell.

    But then if something is satire isn’t it supposed it A) Be Obvious or B) Be Labeled Satire? (ie., Dave’s article: is it opinion or satire?)

    Aren’t things labled that way on BC usually? Or are you somehow exempt?

    Dave “allowed” a serious discussion and then let Clav “explain” that the piece was satire? Or that some of the comments are? Or that just his are?

    Or was this just a closed discussion that no one else was supposed to either read or enter?

    Rather nihilistic of you, Clav, isn’t it? And rather masturbatory of both of you.

    Are you both, as “editors,” allowed to use this blogcritics site any way you wish and then call the rest of us out for being whatever you wish to call us, depending on your mood of the day?

    Gotta say, Clav, Jonathan Swift you ain’t. And Dave, no one seemed to get your sense of “humor” either.

  • Marlowe

    Of course there’s a low level of “theft”. All the real theft was made LEGAL before one boot touched down in Iraq… It’s called government contracts…

    Marlowe

  • http://www.indyboomer46.blogspot.com Baritone

    Two words: Soylent Green.

    B

  • DiannaD

    “Out of a total expenditure for the War on Terror which currently runs almost $600 million a year, and has likely cost more than $2 trillion to date with more than another $2 trillion to come in the next 10 years…”

    You’re doing a helluva job, Bushie.

    Why didn’t Bush pay attention in August, 2001 to the warnings of an attack?

    Speaking of efficiency…

    Bush’s August, 2001 summer vacation has been extremely costly.

  • http://www.indyboomer46.blogspot.com Baritone

    Dave has done this before. When his data proves inaccurate or his thesis is disproved, he comes back and tells us he was only kidding, that we must be a bunch of dolts because we didn’t get the joke.

    What a guy!

    B

  • Pablo

    Dave, Dave, Dave, Your so funny, and pitiful at the same time. :)

  • http://www.republicofdave.com Dave Nalle

    Baritone, I was never kidding. Making a point humorously does not invalidate the point. This ought to be clear even to you.

    Before this article was even published I sent a query to the editors asking if it was satire and got no commitment one way or another. I don’t believe it fits the definition of satire. It’s more like irony or sarcasm. It’s mainly just a different way of looking at the situation.

    Plus my thesis hasn’t been disproved and my data is accurate. The only argument against my point is that wasting money is bad, which I don’t dispute. But which is easily countered with the point that if that’s the case why aren’t they going after Medicare/Medicaid fraud.

    Dave

  • zingzing

    clavos: “it’s all relative”

    money is relative? pure dollars and cents?

    you’re on a roll today.

    or did i just spend too much time away?

  • http://www.marksaleski.com Mark Saleski

    …and my data is accurate

    right. and water isn’t actually wet. etc. etc.

  • troll

    Dave – this one is a true stinker

    the implication (as has already been questioned in the comments I’m sure) is that there has been no corruption or graft in the WOT except in Iraq – highly unlikely

    ‘don’t you worry son – the elections will all be over soon’…and with luck you’ll regain some of your facilities

  • Cindy D

    Clav was merely pointing to his own post as satire.

  • bliffle

    Who cares about efficiency, anyway? Who cares about corruption?

    At the worst it just leads to deficits and Reagan proved that Deficits Don’t Matter and Bush proved it all over again.

    So we should immediately have Universal Health Care.

    We should move the homeless and indigent into all those empty houses created by foreclosures.

    Everyone should have a minimum income.

    It can’t cost more than a couple trillion dollars.

    Let’s see, this administration started off with a trillion dollars worth of tax gifts to our favorite rich people. We spent a trillion (or two) on a pointless war. Now we’re spending a trillion (or two) bailing out Wall Streets bad casino bets.

    Seems like enhancing the lives of our citizens can be done with the change that falls behind the sofa cushions of this administration.

  • http://www.republicofdave.com DaveNalle

    once again, since troll seems not to be able to grasp it, the ‘point’ of this article is primarily that the great and terrible criminal defrauding of the American people in the War on Terror amounts to enormously less than the amount of waste and fraud the government or private business experiences every day, so making it your primary target for outrage means you’re really concerned about something other than the actual waste and fraud.

    Frankly, I’d rather have an American company like Halliburton benefit from bad bookkeeping and fraud than Robert Mugabe who gets more than his share of stolen aid money.

    Dave

  • troll

    the ‘point’ of this article is primarily that the great and terrible criminal defrauding of the American people in the War on Terror amounts to enormously less than the amount of waste and fraud the government or private business experiences every day

    …and the point of the criticism of your piece which you seem incapable of understanding is that the numbers are not in on this claim as yet

  • troll

    and oh yeah – the big H is an American Co in name only

  • http://www.indyboomer46.blogspot.com Baritone

    “…the great and terrible criminal defrauding of the American people in the War on Terror amounts to enormously less than the amount of waste and fraud the government or private business experiences every day,…”

    But you DIDN’T establish that. You compared apples to oranges. You compared $93M in losses solely in Iraq, to all of the supposed expenditures in the “war on terror” which is a demonstrably larger undertaking.

    I assume no one here supports government waste and fraud. But your “point” is defused when the basis of your argument is proven wrong in its construct.

    B

  • http://www.republicofdave.com DaveNalle

    and oh yeah – the big H is an American Co in name only

    Solely because like a lot of companies they were forced offshore by our rapacious corporate tax rates.

    And Baritone, I never said one word about losses in Iraq. Read the article. The comparison is of losses in the war on terror with spending on the war on terror. Nothing about Iraq.

    Both you and troll seem not to have actually read what I wrote.

    Dave

  • http://marksaleski.com Mark Saleski

    Both you and troll seem not to have actually read what I wrote.

    ah, that old reply.

    again, the bbc article does not even mention “terror”, but only iraq. and it does not even come to the same conclusion you use when referencing it.

    then, your link to the war on terror spending uses a figure projected ten years into the future.

    go ahead and tell us we don’t know what we’re talking about. you’ll be wrong again.

  • http://www.indyboomer46.blogspot.com Baritone

    God Dave, wake up! Check out your very first link to the BBC report. What does it say? YOU READ IT BUBBA! I’m not a fucking idiot. It says $93b lost in IRAQ, not in the overall war on terror. Again, you are comparing apples and oranges. Duh!

    B

  • http://www.republicofdave.com DaveNalle

    Guys. I link to the BBC article as a starting off point. I then link separately to other sources for most of the data. Most sources which report this story say that losses in Iraq and Afghanistan add up to $23 billion. The BBC article is inaccurate in assigning that figure solely to Iraq.

    If I just wanted you to read the first link and nothing else then why would I bother to write an article? For that matter, why do I bother to read multiple neutral sources and do research when it just gets ignored?

    Dave

  • zingzing

    maybe your writing this time out is unclear if your message is this easily confused.

    i dunno.

  • Jordan Richardson

    why would I bother to write an article?

    That’s a helluva question.

    The fact of the matter is that your loosely arranged premise fell apart and now you’re constantly moving the goalposts to make it seem like you had this grandiose underlying plot to your article all along and none of the rubes understood it.

    Fess up, Dave. You fucked up.

  • zingzing

    wait, where did this “$93b” figure pop up? god, so many numbers… i thought it was $23b. 2017, 2.4, 23, 93…

  • http://marksaleski.com Mark Saleski

    why do I bother to read multiple neutral sources and do research when it just gets ignored?

    i have read your “data” and commented on it multiple times (as have others) and you choose to ignore it.

  • troll

    Most sources which report this story say that losses in Iraq and Afghanistan add up to $23 billion. The BBC article is inaccurate in assigning that figure solely to Iraq.

    fine – why don’t you correct the problem by linking to one in the article rather than the erroneous BBC…problem of communication solved and the criticism goes away

    (Jordan – Dave does not fess up)

  • Lisa Solod Warren

    Cindy:

    I dunno. Dave was wondering whether his piece was Satire or Opinion. He obviously got his facts wrong. No one got his humor. Clav was defening Dave’s humor. And Clav doesn’t seem to believe in anything much. So….

  • Clavos

    Just for the record, my labeling one of my comments on this thread as “satire,” was a private joke, and had nothing to do with Dave or this article.

  • Lisa Solod Warren

    Well, Clav, I certainly hope, after all that, the private person to whom the joke was directed, got it and appreciated it.

  • http://www.docsnaps.com a bookkeeper

    Interesting to compare your account with the one in Eurocritics. While overall the finances of war have been handled well (according to Dave), losses could have been further reduced by due diligence and audit reviews (according to BBC, and Eurocritics).