The coronavirus is negatively impacting the economy and will leave lots of damage in its wake. Most of us in the private sector are feeling pain that will only be exacerbated in the future. The recession-to-come will cause a major restructuring of our economy with many businesses going bankrupt and workers left unemployed.
Our government should feel the pain as well. After all, we are all in this together.
Untouched Government Agencies
So far millions in the private sector have lost their jobs or have been furloughed—but not many in government have. Many government employees continue to get salaries and benefits despite not working. Their agencies most certainly will not have as much work to do since major portions of the economy are closing down. Many agencies won't even be needed any longer, but you better believe they will continue to be funded and probably expanded over time. That is outrageous. As we suffer economically, government should not be exempted.
This phenomenon is truly confounding and unfair. After all, government does not exist without taxes and taxes can only come from people who produce and earn a living—in other words, the private sector. The private sector supports government employees who, on average, receive higher pay, better perquisites and much better retirement plans. That should change. As we restructure our economy in the wake of the coronavirus, government should be restructured as well.
Businesses have no guarantee they will remain in business—they must provide their customers with a quality product or service at a competitive price or they will go bust. But government agencies remain in place for life, even if they continue to provide lousy services at outrageous expense. Government needs to show us they are with us during this fight. Part of doing so is to take a hard look at various agencies and departments to see if they can be improved or if they need to be eliminated. Before you say that would be difficult, let's look at some obvious choices.
Corruption and Waste
Government corruption and waste are rampant. We generally have ignored these problems because times were good. Now that the bottom is falling out of the economy, these apparently once-minor issues should outrage us all. Here is just a little taste of the waste:
Federal government agencies have a use-it-or-lose-it policy that encourages waste on a grand scale. If they don't spend their allotted budget for the year, they may not get the same allocation the following year. Therefore, agency heads have an incentive to spend the entire budget irrespective of effectiveness, which leads to large, needless expenditures, especially in September, the last month of the government's fiscal year.
For FY 2018, $97 billion went out the door from 67 different agencies in September alone. $53 billion went out the very last week of the month, representing over ten percent of total expenditures for the year for things such as $1.7 million for musical instruments, $9.8 million for workout equipment, and $4.6 million for lobster tails and crab.
Improper payments from a multitude of programs waste inordinate amounts of money. Social security recipients were overpaid by $10 billion. There are currently six million active social security numbers for people over 112 years old, even though there are only 40 people alive in the entire world who are older than 111. How can the social security administration allow this to happen? Medicaid and Medicare admit to over-paying $36 billion and $31 billion last year respectively.