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Friday, November 22, 2019

Pentagon's Second Audit Identifies 1,300 New Problems

By Eric Boehm - November 22, 2019 at 12:30PM

The second ever audit of the Department of Defense ended, predictably, in a second consecutive failure.

Don't expect that to make a difference when it comes to wasteful military spending.

The recently completed audit uncovered 1,300 new problems with the Pentagon's budgeting and record-keeping. That's on top of the 2,410 separate findings and recommendations made last year, when auditors cracked open the department's books for the first time in history. Auditors also identified 25 "material weaknesses"—broad areas, such as the F-35 fighter program, where managerial and record-keeping failures put taxpayer dollars at risk.

Auditors gave Pentagon officials credit for resolving about 500 of the issues identified last year. That should prove that the Defense Department was wrong to resist audits for so long, and it gives us some measure of hope that the biggest black hole in the universe of federal spending might someday be reduced in size.

Still, there's a lot of work to be done. Among the most incredible findings in the new audit, The New York Times reports, is "$81 million worth of active material not tracked in the inventory system" within a Navy logistics center in Jacksonville, Florida. Yes: Navy officials managed to misplace enough equipment and gear to equal the annual budget of a small city.

More than 1,400 auditors made 600 site visits and reviewed more than $2.9 trillion in assets and $2.8 trillion in liabilities, according to the final report (which itself is the culmination of more than 20 separate audits). It cost more than $1 billion.

Despite the failures, Pentagon officials are spinning the audit as a step in the right direction. Elaine McCusker, Department of Defense comptroller, declared in a statement that the Pentagon "made progress in our priority areas while focusing on the importance of sustainable solutions."

It's really up to Congress and the White House to hold the military accountable—but don't hold your breath. After last year's failed audit, after all, the Pentagon got a huge budget increase. President Donald Trump tweeted in December that the military's $716 million budget was "crazy!" but then he signed off on a budget that hiked the department's funds to $750 million—well in excess of the $733 million the Pentagon had actually requested.

With incentives like that, there's little hope the Pentagon will pass an audit anytime soon.


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