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Procurement refers to how governments (federal, state, and local) to purchase products or services from private vendors. Government contracting, in theory, prevents price fixing and promotes competition, as private vendors bid lower (i.e. cheaper costs for taxpayers) in order to win the contracts.
In practice though, government contracting does not always end up being so fair. With nepotism, cronyism, bid rigging, etc., private vendors and the officials in charge of selecting who to award contracts to can be corrupted if they weren’t already. In short, the immoral practices can lead to unethical profit-boosting (e.g. overpriced contracts, use of cheap materials, shoddy work, and so on) that ends up costing us, the American people, much more upfront or down the line through taxes.
DID YOU KNOW?
“Obamacare’s website was supposed to cost $464 million. It cost $834 million and still crashed. Washington D.C.’s Visitor Center rose in cost from $265 million to $621 million. The Veterans Affairs medical center being built near Denver was projected to cost $590 million. Now they estimate $1.7 billion.”
To be fair, corruption does not always play a part in wasteful government contracting. Sometimes the costs are caused due to outdated technology, which the government should have updated long ago.
Megacorporations and their lobbyists could be heavily influencing legislation and regulation. Do your part and protect the U.S. economy by joining the Zero Theft Movement, the effort to calculate the rigged economy.
Key Questions to Consider
The Zero Theft Movement is dedicated to eradicating the rigged layer of the economy. These are economic areas the public vote has decided is rigged. In this article, we will examine whether state and local government contracting and spending is an area where the economy has been rigged by crony capitalists and/or corrupt officials.
The only way citizens can be provided services and have enough of the economic output to come into their pockets is for extreme gross waste to be removed.
- Is there gross waste in state and local government contracting?
- Are citizens being ripped off by having their money go to wasteful spending?
MORE ON WASTEFUL SPENDING
➤ Government Contracts: Is $586.2 Billion Being Spent Well?
➤ The Big Dig: A Hole in the Heart and Wallets of Bostonians
Wasteful Government Spending: Local vs. State Expenditures
As it pertains specifically to spending on the state and local governmental level, the Urban Institute claims:
“State and local governments spent $3.1 trillion on direct general government expenditures in fiscal year 2017. States spent $1.4 trillion directly and local governments-cities, townships, counties, school districts, and special districts-spent $1.6 trillion directly. The state and local totals do not sum to a combined amount because of rounding…States transferred over $530 billion to local governments in 2017.”
Procurement specialist Colin Cram estimated that the U.S.’s “public sector procurement spending by and within states amounts to some $1.5 trillion a year…[which is] around 70% of total U.S. public sector spend.”
The $2 Million New York Bathroom
“Did you see the $2 million dollar bathroom? That’s what New York City government spent to build a “comfort station” in a park…There [are] no gold-plated fixtures. It’s just a little building with four toilets and four sinks…No park bathroom needs to cost $2 million. An entire six-bedroom house nearby was for sale for $539,000.”
From a 2017 article published by Reason magazine
Whether the bathroom will be put to good use is not so much the question here. It’s a question of how much money really needed to go to providing an arguably necessary service. Debates on pork barrel spending and earmarks can sometimes devolve into a matter of approving whatever spending that benefits you or your community and disapproving whatever isn’t.
Frankly, there are many ways to cut instances of potentially wasteful government contracting. While questions and debates might often arise about the usefulness of expenditure, a major focus should also be placed on cost efficiency. Did the project need to cost so much? That’s one point, beyond one’s views on whether the government should be funding, for example, a bathroom or a mural, where we can likely find much more agreement.
Seattle Public Schools Overspending?
In the late 2000s, the Seattle public school system was dealing with severe budget overruns. This led to a comprehensive audit of the system’s finances, revealing all kinds of potential instances of wasteful spending.
“The latest audit of the state’s largest school district says the district overpaid employees by at least $335,000 in the 2008-09 school year, made several mistakes in its financial statements, and continues to claim more Native American students than it can document.”
“The district received $233,792 from the federal government to meet the academic needs of Native American students for 1,123 students. But the Auditor’s Office said the district could provide the documentation only for 377 eligible students. The district also failed to apply on time for the grant for the upcoming school year, and so did not get it. But the district has pledged to make up for that loss out of its general fund.”
From a 2010 Seattle Times Report
Note: Unfortunately, the reported audit has been removed from the SAO (Office of the State Auditor) website.
If true, $335,000 in overpayments in just one school district—albeit the largest in the city—is far from negligible. This is not to say that educators shouldn’t get paid more. They probably should, but in an official, traceable, and intentional fashion.
We are living in a technologically advanced world where we can:
- Build materials at the molecular level with carbon nanotube technology;
- Trade millions of stocks in milliseconds with high frequency trading;
- Travel to the moon;
- Map out the entire CNS of the human body with the Human Genome Project.
Technology can ensure the right amount of payments are going out with a better ability to trace them. The same applies to the ‘missing’ documentation for 746 Native American students (1,123 – 377) who may or may not have actually benefited from the $233,792 in reported aid. Having proper technological solutions in place can make government contracting and spending much easier to track and oversee. Discrepancies can be caught before they mount and end up costing millions of wasted taxpayer dollars.
The infamous Big Dig, one of the biggest public works projects in U.S. history, started in the early 90s and was supposed to finish in 1998, with a total price tag of $2.56 billion ($7.4 billion adjusted for inflation as of 2020). The project ended in 2007, costing $14.8 billion ($25 billion adjusted for inflation as of 2020). That’s more than five times the original estimate. Was this just one big waste of money? Find out what citizens have found out about the Big Dig.
“In this case, the Superintendent herself spent $3,800 of the district’s dollars on a catered retirement party last June, in the midst of massive cuts and school closures…That party and its price tag first came to light in a state auditor’s report that condemns the school district for financial mismanagement on virtually every level…But the audit specifically singled out that retirement party as inappropriate use of [procurement] cards. The report cites the district’s own policy that only allows for $1000 per procurement card transaction.”
From a 2010 NBC King 5 Report
For those of you who don’t know, a procurement card (a.k.a purchasing cards or P-card) is a type of credit card that allows employees to acquire goods and services without having to process the transaction through a typical purchasing procedure (e.g. using purchase requisitions or purchase orders). Procurement cards have the benefit of reducing administrative costs and cutting purchasing processing time.
Independent organization Illinois Policy released a report detailing many instances of wasteful spending they believed was/is going on in their state. The report claims, “The state’s most recent spending plan is out of balance by as much as $1.5 billion, and includes $54.2 million in wasteful spending and $27 million in pork-barrel spending.”
The following are some examples of what Illinois Policy has deemed pork barrel/wasteful spending:
- $13.1 million on an arts council chaired by the wife of Illinois House Speaker Mike Madigan, which has been subject to criticism for misusing taxpayer funds
- $23.6 million on programs that encourage bike-riding in Illinois
- $3.6 million on the development of the World Shooting Recreational Complex in Sparta, in addition to $2.6 million on operating costs
- $75,000 to encourage young people to take up golf
- $25,000 on monarch butterflies
Illinois Policy claims that, excluding school districts, there was $97.2 million in waste across state and local governments across Illinois. They also argue that “$97.2 million of waste is only the tip of the iceberg. Examining the individual budgets of nearly 7,000 government bodies in Illinois is impossible due to poor financial transparency and a lack of records in many of these entities, not to mention the sheer volume of them.”
One more noteworthy example from the report is the annual picnics at Bedford Park:
“Perhaps the most ridiculous spending in Bedford Park is on annual picnics, which cost an average of $45,700 per year, totaling more than $140,000 over the course of three years. The village spent over $4,000 on beer alone for these picnics. Residents are also paying big money for golf outings, which cost nearly $34,000 in 2015 and nearly $40,000 in 2017. The 2016 golf outing’s $10,000 cost was more modest, but wasteful nonetheless.”
Scratching the Surface
State and local government contracting and spending affects all of our lives. Why? Your tax money should be spent well and efficiently in order to fund services and programs that actually benefit people. Again, this matter of how our money should be spent is a debate that will never end, but fraudulent behavior and inefficient use of funds should undoubtedly come under security.
In this article, we have just cited a few examples. There are many more out there that could strengthen or possibly refute the evidence we have presented here. Either way, if we want to eradicate the rigged economy in order to make our economic system function better for all, we need to get to the truth.
Make heroism a part of your daily routine
Take a few minutes out of your day to vote on the issue. You and your fellow citizens decide, with supporting evidence, if an economic area is rigged.
Serve your fellow citizens as a citizen investigator
The success of our movement rests in your hands, the leaders willing to dedicate time to conduct investigations into potentially rigged areas of the economy. With your valuable work, the movement has no solid ground to stand on, no foundations, no proof, to actually hold those corrupting our system accountable for their actions.
View how much is being stolen, according to the public
Your fellow citizens have voted. Based on the evidence provided from citizen-led investigations, you voice your opinion on whether theft is occurring in each economic area. Don’t believe the economy is rigged? See what the American public has to say about that…
Eradicate the Rigged Layer with the Zero Theft Movement
Crony capitalists and corrupt officials have created a rigged layer of the economy that enables them to unethically profit off of the everyday American. This corruption has led to 50 years of wage suppression, 50 years of price fixing and anti-competitive markets, and 50 years of legislators and regulators who work to satisfy moneyed interests, not our interests.
It’s about time we fought for what’s ours. We cannot do it without you.
Investigate your areas of interest
All areas of our economy could be experiencing rigging by crony capitalists and corrupt officials. We need to systematically each instance in order to create an ethical economy.
Find out about Wall Street and NASDAQ quotes.
Or Learn about how Medicare Part D drug prices and the non-interference cause alternatively, find an area that interests you most.
Commitment to nonpartisanship
The rigged layer causes all of us to suffer, regardless of our political allegiances. If we are to eliminate rigged economy theft, we have to set aside our differences and band together against crony capitalists and corrupt officials.
Free Educational Content
An educated public is an empowered public.
We regularly publish informational articles on ZeroTheft.net that teach you all about the rigged layer of the economy in short, digestible pieces. You can better protect yourself and others from the schemes of crony capitalists by reading our articles.
LEARN more about the rigged economy
➤ CDO: Collateralized Debt Obligation?
➤ Run on the Bank: The Effects of Withdrawing Deposits En Masse
The ZeroTheft Movement does not have any interest in partisan politics/competition or attacking/defending one side. We seek to eradicate theft from the U.S economy. In other words, how the wealthy and powerful rig the system to steal money from us, the everyday citizen. We need to collectively fight against crony capitalism in order for us to all profit from an ethical economy.
Terms like ‘steal,’ ‘theft,’ and ‘crime’ will frequently appear throughout the article. ZeroTheft will NOT adhere strictly to the legal definitions of these terms (since congress sells out). We have broadly and openly defined terms like ‘steal’ and ‘theft’ to refer to the rigged economy and other debated unethical acts that can cause citizens to lose out on money they deserve to keep.