I’m not sure which one is worse – the one with fewer financial consequences but indicative of the bureaucratic morass that is Washington, or the one that purposely grows the too-large federal “safety net.”
First, the bureaucratic morass:
It is one of the oddest spending habits in Washington: this year, the government will spend at least $890,000 on service fees for bank accounts that have nothing in them. At last count, Uncle Sam has 13,712 such accounts, each containing zero dollars and zero cents.
These are supposed to be closed. But nobody has done the paperwork.
So even now — as the “sequester” budget cuts have begun idling workers and frustrating travelers — the government is still required to pay $65, per year, per account, for the empty accounts. In this time of austerity, these accounts are a reminder of something that makes austerity hard: expensive habits, built into the bureaucracy in times of plenty.
This is pretty much just terrible. And the process is so bureaucratic, it’s no wonder the bank accounts aren’t being closed:
First, a federal agency gives out a grant. It doesn’t just write a check; it creates an account within a large government-run depository. The grantee can draw money out.
Then, at some point, it’s over. The money runs out. Or the grant’s time expires. The agency is given notice: It’s time to close the account down.
But that takes work. An agency is first required to audit the account, to make sure the money was spent properly. That’s generally supposed to happen within 180 days. If it doesn’t happen, however, there isn’t any formal consequence.
And so — sometimes — it doesn’t happen. Right now, about 7 percent of the 202,000 total government grant accounts are devoid of money. These sit on the books, costing about $5.42 per month. The service fees are the same, whether an account is full or empty.
The full cost? $21 million annually. That’s a lot of money to spend on literally nothing.
In case your blood isn’t boiling yet, keep reading on how the federal government is hiring people to sign people up for food stamps:
A good recruiter needs to be liked, so Dillie Nerios filled gift bags with dog toys for the dog people and cat food for the cat people. She packed crates of cookies, croissants, vegetables and fresh fruit. She curled her hair and painted her nails fluorescent pink. “A happy, it’s-all-good look,” she said, checking her reflection in the rearview mirror. Then she drove along the Florida coast to sign people up for food stamps.
In fact, it is Nerios’s job to enroll at least 150 seniors for food stamps each month, a quota she usually exceeds. Alleviate hunger, lessen poverty: These are the primary goals of her work. But the job also has a second and more controversial purpose for cash-strapped Florida, where increasing food-stamp enrollment has become a means of economic growth, bringing almost $6 billion each year into the state. The money helps to sustain communities, grocery stores and food producers. It also adds to rising federal entitlement spending and the U.S. debt.
Since 2008, the U.S. Department of Agriculture has advertised for the food stamp program. Now we find out it is helping fund whole jobs dedicated to signing people up for the program, which has expanded dramatically since 2000.
The article itself focuses on the human side of food stamps, garnering sympathy for the millions of people who are unemployed or barely surviving on minimal incomes. And the level of sympathy should be great – Washington brought us into the recession, and now it has prevented a true recovery from taking place, just shy of four years after the recession officially ended. But personal sympathy should not dictate public policy.
This is the problem with having an ever-expanding, ever-encroaching, ever-expensive federal government. It has no bottom line, so it doesn’t worry about efficiency. To quote Heritage’s Rachel Sheffield on food stamps:
In other words, the federal government seems to be saying that federal dependence translates to poverty relief.
Exactly. The federal government makes things worse, then says more government will make things better. And the cycle repeats itself.
Meanwhile, your tax dollars are funding empty bank accounts.