Whenever you talk to someone who says that they are “fiscally conservative” (and they usually follow it with “… and socially libertarian”) you are authorized to laugh at them. Indeed, you are deputized hereby to deliver derisive laughter. I’ve said many times that it’s impossible to be “fiscally conservative” and not be mind-blown upset about defense expenditures and pentagon financial fraud.

The Pentagon has already been identified as having “lost track of” its budget, to the point that it spent $6 billion “attempting” to “audit” its books and concluded: “we can’t.”[stderr] If you remember the kabuki theater about the “sequestration” and DoD budget cuts, you may be shocked to learn that that was all a gigantic fraudulent paper exercise: the pentagon just kept spending. At an increased rate, of course. But they hid it. If there is one kind of stealth program that the DoD really knows how to run, it’s stealth spending.

Read between the lines (my highlights): [Office of the Undersecretary of Defense, Comptroller report]

Summary

The Department of Defense (DOD) estimates that Congress has appropriated $1.6 trillion for war – related operational costs of the DOD since the terror attacks of September 11, 2001. When combined with an estimated $123.2 billion in related State Department and Foreign Operations appropriations, the DOD, Department of State (DOS), and U.S. Agency for International Development (USAID) have received an estimated $1.7 trillion for activities and operations in support of U.S. response to the 9/11 attacks.

Funding for these activities has been largely provided through supplemental appropriation acts or has been designated as an “emergency” or “Overseas Contingency Operation/Global War on Terror” (OCO/GWOT) requirement in annual agency budget requests – or both. Funds designated as such are not subject to procedural limits on discretionary spending in congressional budget resolutions or to the statutory discretionary spending limits established by the Budget Control Act of 2011 (BCA). While there is no overall statutory limit on the amount of emergency or OCO/GWOT – designated spending, both Congress and the President have a fundamental role in determining how much OCO/GWOT and emergency spending is provided each fiscal year. Congress must designate any such funding as OCO/GWOT in statute on an account by account basis. The President is also required to designate it as such after it is appropriated in order for it to be available for expenditure.

Definitions of what constitutes emergency or OCO/GWOT activities and expenses have shifted over time, reflecting differing viewpoints about the extent, nature, and duration of  the wars in Iraq and Afghanistan. Funding designated OCO/GWOT has also been recently used to fund base budget requirements of the DOD and DOS and to provide funding to prevent or respond to crises abroad, including armed conflict, as well as human – caused and natural disasters. The first use of an OCO/GWOT designation in budgetary law was in the 2011 BCA. Prior to the BCA, the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA) only allowed “emergency” requirements to be excluded from budget control limits. The BCA added the designation “Overseas Contingency Operation/Global War on Terror” to the BBEDCA exemption, thereby providing Congress and the President with an alternate way to exclude funding from the BCA limits without using the “emergency” designation.

Basically, the pentagon has been using contingency operations funds to bypass congressional regulation, so they can keep losingwinning wars by throwing gigantic amounts of money around.

“Fiscal conservatives” take note: this is what happens when you give the government a way of spending off the books. Technically it’s not “fraud” because congress is in on it. Although it sounds like they’re pro-forma shocked at how bad it is:

They warn that what was once generally restricted to a fund for replacing combat losses of equipment, resupply of expended munitions, and transport ing troops to and through war zones has “ballooned into an ambiguous part of the budget to which government financiers increasingly turn to pay for other, at times unrelated, costs.”

The GAO agrees. [GAO: OMB and DOD Should Revise the Criteria for Determining Eligible Costs and Identify the Costs Likely to Endure Long Term]

Further, the amount of OCO appropriations DOD considers as non-war increased from about 4 percent in fiscal year 2010 to 12 percent in fiscal year 2015. DOD officials agree that updated guidance is needed but note that the Office of Management and Budget has deferred the decision to update the criteria until a new administration is in place in 2017. Without reevaluating and revising the criteria, decision makers may be hindered in their ability to set priorities and make funding trade-offs.

That means, in bureaucrat, that the DOD has been treating the contingency fund as a gym bag full of bills for spending as much as it wants off the budget. Supporting and equipping and training (that’s code for special operations on the ground) and you’ve got to love that “European Reassurance Initiative” $3.4 billion dollars to “deter Russia and reassure US allies.”

I need reassurance, too.

Some of the reporting [war is boring] I’ve seen on this story mistakes the $1.6 trillion complete post 9/11 budget expenditures for the slush fund expenditures. That’s not accurate. It looks like it’s “only” about $100 billion.