In an age in which our nation has the ability to track information and military movements across the globe — often in real time — American taxpayers should be disturbed that our national leaders lack the ability and will to track key information much closer to home: the hundreds of billions of dollars that flow through our defense budget every year.
More than 20 years ago, Congress passed a law that requires the Department of Defense to pass a financial audit. An even older document, the Constitution, demands a “regular Statement and Account of the Receipts and Expenditures of all public Money.” Yet the Department of Defense has never passed a single audit. In fact, the Pentagon is the only agency in the entire federal government that cannot produce auditable financial statements in accordance with the law. That’s excluding the private sector. Any leader of a private business, corporation, church or association that couldn’t pass a financial audit could find himself in prison.
With a budget in excess of $500 billion a year — more than the gross domestic products of countries such as Austria, Norway, Belgium and 180 or so other nations — not knowing where this money is going isn’t just lawless, it is a threat to both our economic and national security. Put simply, military and civilian leaders cannot make informed budget decisions in an environment in which valid and accurate financial data does not exist. Without an annual financial audit, the Pentagon does not know if every valuable tax dollar is spent on the highest-value programs or, more fundamentally, if it even got what it paid for last year.
No one has identified the total budget impact of the Pentagon’s financial-intelligence crisis, but it is easily within the realm of tens of billions of dollars, if not more. In just one branch, the Marine Corps recently found that “for each $1 spent on financial improvement, an estimated $2.77 in value was created for the war fighter.” A nearly $3 return on each dollar spent on better accounting systems — the kind used by your local coffee shop, barber and thousands of other enterprises — could generate savings that could save critical programs from the threat of debilitating cuts.
Sadly, few in Congress seem to care that untold billions are squandered every year through wanton mismanagement and neglect. The sad reality is that while Congress feigns shock at yet another revelation that is the result of the Pentagon’s poor accounting — a weapon-system cost overrun or an information-technology system failure — Congress is fully complicit in this scam on American taxpayers.
Year after year, the Pentagon recycles the same excuses it has used since the 1950s, but now promises it is finally making progress toward meeting its statutory deadlines. Year after year, Congress appropriates hundreds of billions of dollars without requiring the Pentagon to comply with the law and the Constitution.
Our military leaders understand this dynamic very well. They know that politicians too often see our defense budget as a jobs program and parochial playground rather than a tool to protect our national interests and freedom. For example, in the past two years, our military leaders have described the parochial impacts of sequestration with great precision and clarity, knowing full well that few in Congress would ever call out the Pentagon for its ignorance of its own spending.
Who can blame our military leaders for spending more time tracking congressional appetites for pork than their own spending? When our military leaders receive funds without accountability, they have zero incentive to do the hard work of producing auditable books.
The only way this cycle can be broken is for the American people to demand that Congress use its power of the purse to demand accountability at the Defense Department, rather than simply rubber-stamp the defense budget.
First, Congress should have an open amendment process and debate that will bring these issues to light. Last year, Senate Majority Leader Harry Reid would not even allow amendments to be introduced and debated on the nearly $700 billion, 600-page annual defense authorization bill. If the majority leader spent as much time chastising Pentagon leaders — say, the chief management officer, the chief financial officer or every manager and director who signs off on the department’s financials — as he does the Koch brothers, we’d be much closer to an audit.
Second, Congress can pass the bipartisan Audit the Pentagon Act, introduced with Sen. Joe Manchin III, West Virginia Democrat, which would create real incentives and impose real consequences in order to force the Pentagon to track its own spending. A companion bill was introduced in the House by Rep. Mike Coffman, Colorado Republican.
We simply cannot afford to continue this charade any longer. As former Chairman of the Joint Chiefs of Staff Admiral Michael Mullen said, our $17 trillion debt is “the most significant threat to our national security.” If we are going to borrow from China in order to defend ourselves against China, the least we can ask is that the Pentagon audit its books.
Tom Coburn is a Republican member of the U.S. Senate from Oklahoma.