A new report issued by an independent government watchdog agency confirms federal government agencies are failing to ensure taxpayer money is spent in an efficient manner.
According to the Government Accountability Office (GAO) report, federal agencies are failing to comply with purchasing requirements intended to ensure agencies are getting the best bargains for taxpayer-funded purchases and projects.
Jonathan Bydlak, president of the nonpartisan Coalition to Reduce Government Spending, says government purchasers are given no incentive to spend money efficiently.
“It really comes down to the matter of incentives that the government tends not to have,” Bydlak said. “If you’re the head of some agency or you’re the head of a department, you don’t have a strong incentive to economize, because ultimately at the end of the year, you know that if you don’t spend the money that you’ve been allocated then you’re going to lose it next year.”
Addicted to Spending
Bydlak says government agencies continually push for spending increases.
“The incentives for bureaucrats [are] … to push an increase in spending as much as they can, and if it costs more to get the products that they may need, compared to a private-sector entity, they don’t really have a problem with that.”
Veronique de Rugy, a senior research fellow of the Mercatus Center at George Mason University, says frugality is an alien concept to government bureaucrats.
“The government doesn’t have any incentive to cut costs, because they are spending someone else’s money and there’s no consequences when they have cost overruns or when the government runs deficits,” de Rugy said.
Cutting government spending is the only way to really make spending more efficient, de Rugy says.
“The reality is that oversight just doesn’t work that well,” de Rugy said. “In fact, it mostly doesn’t work at all. The real way to go about it is to really shrink the size of government. Sure, you can tweak them a little by having rules about competitive bidding, but I think it only works at the margins. The real way to fix this problem is to shrink the size of government.”
Warner Todd Huston ([email protected]) writes from Streamwood, Illinois.
Government Accountability Office, “Federal Supply Schedules: More Attention Needed to Competition and Prices”: https://heartland.org/policy-documents/federal-supply-schedules-more-attention-needed-competition-and-prices/