A Coronavirus Spending Scandal

Seven months ago, the U.S. Congress rushed to pass the CARES Act, a $2 trillion emergency spending package that funded hundreds of coronavirus relief programs meant to help regular Americans cope with the impact of the pandemic.

The coronavirus pandemic has proven one thing about that spending: The federal government is not very good at it. Sure, it can spend money like nobody’s business and the U.S. Treasury Department has the bills to prove it. But it is failing to deliver on the promises made to Americans that it would help them with the pandemic.

An example of that failure is visible in how the Pentagon managed its CARES Act fund allocation. Here, lawmakers gave the Pentagon $1 billion, with the idea it would get defense contractors to help make much needed medical equipment.

But the Defense department’s bureaucrats had other ideas for the money. The Washington Post describes how they subverted the intent of U.S. lawmakers:

... in the months after the stimulus package was passed, the Pentagon changed how the money would be used. It decided to give defense contractors hundreds of millions of dollars from the fund, mostly for projects that have little to do with the coronavirus response. Defense Department lawyers quickly determined that the funds could be used for defense production, a conclusion that Congress later disputed.

Points of Failure

Like any Washington, D.C., scandal, there are many points of failure to consider in this story. The main failure lies with the U.S. Congress, which in its rush to spend trillions, failed to specify how the Pentagon should spend its funds.

Critically, another point of failure lies inside the Pentagon’s bureaucracy. These bureaucrats put their perceived needs ahead of the lawmakers’ intentions.

The pandemic funding “became an opportunity for the Department to take what is almost a windfall and use it to try and fill what are some very critical industrial base needs . . . but that are only tangentially related to COVID,” said Bill Greenwalt, a visiting fellow with the conservative American Enterprise Institute who oversaw defense acquisitions in the George W. Bush administration.

If there were more ethical integrity in Washington, D.C., heads would roll in this fiasco.

But neither sloppy lawmakers nor greedy bureaucrats will face the axe of accountability. That’s because neither of these groups wants to have a lot of scrutiny into how they spend money. They only ever want to spend more, and if they can do it without any public attention or debate, they will. Consequently, today’s coronavirus spending scandal will fade from view, with little notice.

In such a system, scandals aren’t a bug, they’re a feature. Such are the ways of the swamp.

Craig Eyermann is a Research Fellow at the Independent Institute and the creator of the Government Cost Calculator at MyGovCost.org.
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