There’s a big difference between corporate and government financial mismanagement. Federal incompetence is much worse. Business leaders should denounce government malfeasance and hold public hearings.
This “Letter to the Editor” was published in the Gwinnett Daily Post on July 25, 2002.
Self-righteous posturing from Washington politicians is comical. They frighten us with stories of corporate greed, accounting irregularities, lost investments, and criminal businessmen and women. They demand restitution and justice when talking about Enron, WorldCom, Global Crossing, and Martha Stewart. They never mention the following.
Two federal agencies, the Export-Import Bank and the Overseas Private Investment Corporation; lent Enron more the $1 billion. The Maritime Administration loaned $1.1 billion to American Classic Voyages to build ships in Senator Lott’s hometown. In both cases, the companies are bankrupt and taxpayers will not recover their loses.
WorldCom misplaced $3.8 billion in expenses. The 2001 federal budget notes,
federal agencies have identified almost $20 billion in annual erroneous benefits and assistance payments in just 13 federal programs.
No matter how bad they trash Martha Stewart, ask your self what she did that was so bad. Did her actions cause people to lose money or jobs? No, the Food and Drug Administration did that when they told ImClone they could not market their cancer-fighting drug Erbitux in the U.S.
All we need do is read the numerous detailed accounts of government incompetence published throughout the years by the General Accounting Office. Recall past stories of expensive toilet seats and hammers.
The quotes below come from David Walker, Comptroller General of the United States in a report (AIMD-00-131) prepared by GAO in March 2000.
In summary, certain significant financial systems weaknesses, problems with fundamental record keeping and financial reporting, incomplete documentation, and weak internal controls prevent the government from accurately reporting a significant portion of its assets, liabilities, and cost.
Readers are cautioned that amounts reported in the financial statements and related notes may not be a reliable source of information for decision-making by the government or the public.
There is a difference between corporate malfeasance and Washington’s financial mismanagement. In the corporate world, investors and employees have a choice and the market destroys incompetent companies quickly and efficiently. Yes, some people are harmed, but the theft goes away. In the federal bureaucracy, taxpayers have few alternatives except to stand by and pay through the nose year after year.
People should be held accountable for malfeasance and fraud, but Enron and WorldCom are relatively harmless compared to unending federal expropriation. Congressional hand wringing over corporate greed is laughable.