Government isn’t a proxy for charity because not only does it fail profoundly at that task, it becomes a hotbed for fraud and waste.
February 17, 2025
By: Bobby Casey, Managing Director GWP
The government isn’t a proxy for charity, because the moment people treat it that way it starts to behave like one. A very unaccountable one. I think private charities are the way to go to solve the problems in our communities, however, you need to do some due diligence.
All of them have these really lovely names and mission statements that will pull your heartstrings. But there are a good number of them that spend anywhere from 0% to 11% of their revenues on the actual cause they purport to serve.
Without any accountability, it goes from helping people in need to helping your friends really quickly. Let’s say you have a charity that feeds the homeless. If you did the math on how much it costs per meal delivered to one homeless person, and get $567 to get one meal to a person, it’s fair to assume there’s some malfeasance afoot.
The fraud and bloated administrations in the US system is so far-reaching, it diminishes any good it could possibly be doing. And much like higher tuition for universities, the money isn’t going toward better resources or higher paid professors. It’s going toward more administrators.
Eggs Are Still Expensive
Correct. Eggs are expensive because of two things: the shortage of laying hens and consequently eggs due to a purported outbreak of bird flu, and the debasing of the US dollar by way of inflation.
The US is running at a $2 Trillion deficit. DOGE is trying to find more than that in wasteful or fraudulent spending. If the deficit isn’t brought down, then the debt ceiling will go up and more money will be printed, and the prices of everything will continue to go up.
The cuts are necessary. They are wildly overdue. Anything other than addressing the shortage of supply, and the inflation would amount to just kicking the can further down the road. Government isn’t a proxy for charity, and the cost of treating it that way is trillions in debt.
Cutting Fraud
According to the Government Accountability Office (GAO):
“[T]he federal government could be losing between $233 billion and $521 billion annually to fraud. Additionally, federal agencies reported an estimated $236 billion in improper payments in FY 2023, and cumulative federal improper payment estimates have totaled about $2.7 trillion since FY 2003.” (Chart)
It also estimates roughly $16 Billion in fraud with the EITC (Earned Income Tax Credit) per year from 2016 to 2020.
The Treasury Department is estimating roughly $1 Billion per week in fraud minimum. He ordered some basic filing practices such as completing the forms with proper audit codes, payment description, and more frequent updates to the “do not pay” list than annually.
Don’t forget all the Covid “relief” funds: $250 Billion – $560 Billion in assorted Covid Relief Program scams.
“They came into their riches by participating in what experts say is the theft of as much as $80 billion — or about 10 percent — of the $800 billion handed out in a Covid relief plan known as the Paycheck Protection Program, or PPP. That’s on top of the $90 billion to $400 billion believed to have been stolen from the $900 billion Covid unemployment relief program — at least half taken by international fraudsters — as NBC News reported last year. And another $80 billion potentially pilfered from a separate Covid disaster relief program.”
All this is chump change in comparison to what is on the table for the Department of Defense and Medicare. If you recall the Department of Defense spent $1 Billion on an audit only to fail it… for the seventh time in a row and has an $850 Billion budget. Medicare has a $1.5 Trillion budget. The amount of waste and fraud expected to be uncovered in those two alone could be monumental.
The government isn’t a proxy for charity, and to treat it that way allows all these different agencies to layer their wasteful use of money, and countless acts of fraud.
Cutting Needless Admins and Contracts
There was an interesting reel on social media pointing out a contrast between older and younger generations. It explained why older generations keep insisting that cutting luxury items out will help younger people pay for their necessities.
When thinking about “luxuries”, think computers, TVs, and phones. When thinking about “necessities”, think food, shelter, and healthcare.
When boomers and even some GenXers were coming up, the cost of luxuries were more expensive, and the cost of necessities were not. Over time, the two have flipped where luxuries have become more affordable than necessities.
The only real difference between them is how much government is involved in getting them to market. The United States has had housing, food, and healthcare much longer than it’s had any of these modern day tech items.
If you look at this chart, you see an exponential growth in administration and healthcare spending, and very little movement with the number of physicians. The same is true for education, which happens to also have a lot of government involvement.
Food in the US is so regulated, there’s hardly any autonomy for smaller farmers. They can’t opt out of ad campaigns (as was the case for local dairies that didn’t want to pay into the “Got Milk” campaign). They have to purge their surpluses when instructed (as was the case with cherries in Michigan).
Bringing it back to the price of eggs, the USDA incentivized farmers to “cull” (i.e. kill) tens of millions of their laying hens and turkeys by paying them hundreds of millions of dollars. They did this as a response to the bird flu. According to the NYT:
“Officials say the compensation program is aimed at encouraging farms to report outbreaks quickly. That’s because the government pays for birds killed through culling, not those that die from the disease.”
“Since February 2022, more than 82 million farmed birds have been culled, according to the agency’s website. For context, the American poultry industry produces more than nine billion chickens and turkeys each year.”
Between the USDA, FDA, and FSIS, it’s a wonder food gets to market.
Cutting bureaucracy and needless admins is a good thing. Here are just a few contracts that were cut:
- NIH cut over $4 Billion in administrative contracts
- $1 Billion in DEI related contracts
The government isn’t a proxy for charity, much less for every sympathetic whim that begs for money. $5 billion in unnecessary administrative contracts is nonsense.
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