Posted by Jack in Economics
I was thinking about free markets. When many people talk about ‘Free ‘ markets I wonder exactly what they mean. Is it ‘Free’ as in laissez-faire? Is it ‘Free’ as in ‘no monopolies but anything else goes’? Is it ‘Free’ as in caveat empor? Or is it ‘Free’ as in open and above board – a level playing field with free access to all? Somehow I don’t think the last option fits with most uses of ‘Free Market’.
I was thinking about free markets in terms of rivers. Some people think that rivers should be free. They should flow unobstructed, where ever nature takes them. People have noticed that building communities along rivers led to many good things. Not only do they get the enhanced agriculture from the constantly refreshed alluvial plain, but they also have a handy transport highway on the river itself. The communities learn to deal with the annual floods that refresh the fields. Life is good and everyone prospers. But, once a generation the river runs wild, floods outside its expected fields, diverts its path, gouges new channels, leaves communities high and dry, threatens prosperity, induces change. All-in-all, rivers may cause more damage in one year than all the good produced since the last catastrophe.
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Each year, the federal government wastes billions of American taxpayers’ dollars on improper payments to individuals, organizations, and contractors. These are payments made in the wrong amounts, to the wrong person, or for the wrong reason. In 2009, improper payments totaled $98 billion, with $54 billion stemming from Medicare and Medicaid. We cannot afford nor should we tolerate this waste of taxpayer dollars and in our health care system.
From the White House
Let’s see, $3,830 Billion budget - $98 Billion waste. That’s about 2.6% percent waste. Not the best of numbers, but certainly not worth going into a paralytic fury about. I suppose it is easier for some people to grasp a much smaller number than the almost $4 trillion dollar federal budget. Why not allocate another $1 Billion to Inspector General offices to reduce the waste. If they can reduce the waste by 2% or more they more than pay for them selves.
The 2011 Medicare/Medicaid budget seems to be about $755 Billion. with $54 Billion in waste that is over 7% fraud. HHS is planning to increase their Fraud unit budget $250 million in 2011 to $561 million. Maybe that will reduce the waste a bit.
That leaves $44 Billion in waste for the remaining $3075 Billion budget, or 1.4% waste.
I was going through the federal budget looking to see who had Inspectors General in their budget items. I was surprised to see that not all departments have an Inspector General. Especially surprised the Department of the Interior doesn’t have one large enough to have its own budget line item. Somewhere in the text write up the Inspector General is mentioned. I guess that explains why billions of dollars from the Indian Trust funds have gone missing. But Interior not only has the BIA but they also oversee our royalty payments from the industries extracting minerals from public lands.
At least GAO gives the citizens a chance to report the fraud they see.