I doubt any American has ever found themselves in a room with a trillion dollars. Mathematicians have pointed out that if you spent a million dollars a day, every day, since the birth of Jesus Christ, you still would not have come close to blowing through $1 trillion.
And yet the U.S. government spent $3.5 trillion just in fiscal year 2014.
This scale makes it easy to slice off any subset of federal expenditures and construct a massive number, suitable for pasting into hyperbolic press releases and headlines decrying waste or fraud. Anyone with an antipathy to government can capitalize on the general public’s budgetary ignorance to shake their finger shamefully at bumbling bureaucrats. But only with proper perspective can big numbers tell us anything meaningful about whether policymakers are efficiently stewarding taxpayer dollars.
Take for example an article from Monday’s Federal Eye, based on a recent Government Accountability Office report. GAO reported that, from 2005-2014, the Social Security Disability Insurance program overpaid $11 billion to beneficiaries who earned too much money to qualify for full benefits. An untrained observer might think this represented an unconscionable squandering of public funds. After all, $11 billion is a lot of money.
But on the first page of the report, GAO notes that SSA paid out approximately $143 billion in disability benefits in 2014 alone. SSA’s own actuarial estimates put the total ten-year outlay from 2005-2014 at $1.169 trillion, compared to $11 billion in overpayments. That’s less than 1 percent of total expenditures.
Furthermore, all $11 billion wasn’t lost to the government. SSA can claw back overpayments from disability beneficiaries in subsequent years. In fact, GAO reveals on page 9 of its report that SSA collected $7.8 billion in outstanding debt in the ten-year time frame. Only $1.4 billion in work-related overpayments were completely written off. Now we’re down to 0.12 percent of total expenditures.
If I were to tell you that the Social Security disability program was 99.88 percent accurate in issuing benefit amounts to recipients, you might think they were doing an outstanding job. But if I told you the program overpaid by $11 billion – while neglecting to mention how they clawed most of it back – you might dust off your pitchfork and join your local mob’s march to the nearest SSA satellite office.
While both statements are technically true, ripping big numbers from context clearly paints a flawed picture. We cannot expect ordinary citizens divorced from the intricacies of the budget process to know that even $11 billion can represent an insignificant amount in the larger picture.
Even massive numbers can lose their ability to shock when explained correctly. Hillary Clinton proposed a “$350 billion plan” for college affordability, but that is over a 10-year period, and the total spending annually would equal approximately 0.7 percent of the federal budget.
The Wall Street Journal used the frightening number of $18 trillion to describe Bernie Sanders’ campaign promises, but $15 trillion of it was derived from a proposed single-payer health care program that would replace all current national health spending, which costs over twice as much. So that scary $15 trillion would represent a giant savings for the country.
John McCain has made a career out of playing to the cheap seats this way, combining funny-sounding public programs with meaningless numbers. His 2015 report “America’s Most Wasted” snickered at a $30,000 National Endowment for the Arts grant for puppet shows in Vermont, which delighted children in the Green Mountain State for 10 days but irresponsibly blew a 0.00000086 percent hole in the budget.
Letting the McCains of the world get away with half-truths perhaps explains why polls show that the public consistently overstates federal spending. A CNN poll from 2011 put the level of spending on foreign aid at ten times its actual percentage in the overall budget, and estimated the figure for the Corporation for Public Broadcasting a whopping 416 times too high. When big numbers are allowed to roam freely without context, it’s hardly surprising that the public can’t ascertain the full picture.
The drumbeat of stories about stray billions lost here and spent there serves the side of our national debate that wants to reduce the size of government and privatize many of its functions. They’re given an artificial boost by reporting which flatters their prejudices. It’s hard to advocate for expanding social benefits amid inaccurate tales of waste. And this can have real consequences.
To stick with disability insurance, last week’s budget deal creates roving Cooperative Disability Investigations units, special Justice Department prosecutors and expanded reviews to look into suspected fraud. The changes result directly from the insistence of Congressional Republicans, aided by the media, that the disability program is rife with fraud.
But the budget deal’s reforms sound like something you would invest in to police a broken agency, not one with a 99.88 percent accuracy rate. Any private-sector company with a record as sterling as the disability program would be lauded as an industry model. But thanks to the massive amount of money they pump out on an annual basis, they can be demonized for minor slippages.
Nobody would argue that the federal government makes no errors and couldn’t stand for some improvement. But we cannot assess which agencies are foundering and which serve the public well if we breathlessly report every large string of zeroes we see. Journalism that doesn’t assist the public by providing context to the numbers does nothing to hold government truly accountable.
Article originally published: https://www.washingtonpost.com/news/federal-eye/wp/2015/11/04/why-11-billion-in-government-overpayments-is-actually-an-insignificant-amount/?noredirect=on&utm_term=.e0642b5f1167