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Editorial: Cast wider net on fraud, waste in government

Fri., Dec. 9, 2011

With government budgets tighter than ever, waste and fraud must be pursued wherever it exists. The U.S. Department of Agriculture has announced a crackdown on the food stamp program, but it’s important to bear in mind that waste and fraud has dropped significantly since the 1990s.

Nonetheless, taxpayers need to know the government is being vigilant, or they might turn against services vital to the nation’s poor. Those who are fundamentally opposed to aid such as food stamps will never be persuaded, but others will be supportive as long as they’re satisfied that government isn’t wasting the money, and that it’s going to the truly needy.

It takes only a couple of headlines to put any kind of welfare program under the microscope, so it’s smart for government agencies to demonstrate that they’re being responsive.

For instance, the headline “Seattle welfare recipient lives in million dollar home,” is a blow to all welfare programs. Federal agents raided a waterfront home in Seattle last week, and records show that one of the occupants has received welfare benefits, including housing subsidies, since 2003. The home is worth $1.2 million.

Some welfare recipients in Washington state have used their electronic benefits cards at ATMs in and around casinos and strip clubs. One woman was busted in a sting operation for selling the personal identification number on her EBT card. As a result, the Legislature passed a tougher law, and state agencies have become more vigilant.

To reiterate, fraud is down, even if the number of headlines has risen. Though the EBT cards have become the subject of fraud stories, it’s the changeover to them from paper scrip that has been credited with the decline in food stamp abuse.

In any event, the federal crackdown comes at a time when a record 46.3 million Americans are getting $75.3 billion from food stamps. The rolls have increased by 8 percent over last year because of the moribund economy and the widespread effects of Hurricane Irene.

The feds will be working with state agencies on the best strategies for rooting out scams and limiting accounting errors. Some scams are run by recipients of aid; others are perpetrated by retailers. The feds estimate that 1 percent of the food stamp budget, or about $750 million, is lost annually to fraud. It was 4 percent back in the 1990s.

Wasting tax dollars ought to provoke outrage wherever it occurs. The government can’t even quantify the amount of waste at the Pentagon, even though it’s involved in 75 percent of all federal procurement.

According to a recent Bloomberg report, a single agency within the Pentagon – the Defense Logistics Agency – wasted $7.1 billion over three years by double ordering parts. It would take 10 years of food stamp fraud to match that amount. Meanwhile, the government has squandered $60 billion on contracting in Iraq and Afghanistan since 2002.

A food stamp crackdown is wise, but if the government wants to hang on to even more money and increase its credibility with taxpayers, it needs to cast a much wider net.