U.S. Auditors Say Duplicate Programs Cost Billions

(Corrects title of GAO in second paragraph of story that moved March 1.)

In 2007, the U.S. Agriculture Department paid $1.1 billion in farm subsidies to 170,000 dead people. Fifteen federal agencies now oversee 30 food laws, and at least four departments compete to administer 80 economic development programs.

The Government Accountability Office released a 345-page report today combing the federal catalog of government programs to uncover what it said was evidence of waste and duplication that cost taxpayers billions of dollars each year.

Republican Senator Tom Coburn, who requested the GAO report as part of last year’s vote to raise the nation’s debt limit, said it confirms the government is “spending trillions of dollars every year and nobody knows what we are doing.”

“This report also shows we could save taxpayers hundreds of billions of dollars every year without cutting services,” Coburn, of Oklahoma, said in a statement. The GAO “has identified a mother lode of government waste and duplication that should keep Congress busy for the rest of the year.”

The report, “Opportunities to Reduce Potential Duplication in Government Programs, Save Tax Dollars and Enhance Revenue” was issued as lawmakers today debate spending cuts in a two-week stopgap budget measure for the government.

Beyond the stopgap measure, House Republicans have called for $61 billion in cuts for the fiscal year that ends Sept. 30. They face opposition from the Democrats who control the Senate, who say the reductions are too extreme and would slash needed programs in education and regulatory enforcement.

Cost of Duplication

While the GAO report didn’t provide a specific estimate on the cost of waste and duplication, Coburn said it is likely to reach at least $100 billion. The report is the first of what will be annual studies on the matter.

The auditors found 34 broad areas of duplication in federal programs including food safety and domestic food assistance.

Investigators also said there were 47 additional areas, beyond those related to overlapping programs, where savings could be made.

“Reducing or eliminating duplication, overlap or fragmentation could potentially save billions of tax dollars annually and help agencies provide more efficient and effective services,” Gene L. Dodaro, comptroller general, said in his report to Congress.

In one example, the report said the Defense Department could save as much as $460 million annually by restructuring its health-care system.

Lack of Coordination

Among the examples of mismanagement and waste in the report cited by Coburn are a lack of coordination among eight agencies on defenses against biological terror threats; special tax breaks totaling $1 trillion that are often redundant; and $6.5 billion for economic development programs with little evidence of success.

Auditors compiled their report from February 2010 through last month. Some conclusions were drawn from reports earlier in the decade.

President Barack Obama attacked waste and duplication in his State of the Union address and has ordered the Office of Management and Budget to begin laying a blueprint for government reorganization to eliminate waste.

There are 12 different agencies that deal with exports and five that deal with housing policy, Obama said in his speech.

Home for Salmon

“Then there’s my favorite example: The Interior Department is in charge of salmon while they’re in fresh water, but the Commerce Department handles them when they’re in saltwater. I hear it gets even more complicated once they’re smoked,” the president said to laughter and applause.

Fifteen federal agencies collectively administer at least 30 food-related laws, according to the GAO. The Agriculture Department is responsible for the safety of meat, poultry, processed egg products and catfish. If it involves seafood or almost any other food, the responsibility goes to the Food and Drug Administration.

Last year’s nationwide recall of more than 500 million eggs because of salmonella, for example, was handled by the FDA, because it ensures the safety of shell eggs.

The USDA ensures the health of the young chicks that are supplied to egg farms, while the FDA oversees the safety of the feed they eat.

“Oversight is also fragmented in other areas of the food safety system,” GAO said, citing USDA responsibility for catfish and the FDA oversight of seafood.

Biological Attacks

In another example, the GAO said that to deal with a biological attack on the U.S. there are more than two dozen presidentially appointed people in charge. They are spread among the Departments of Agriculture, Defense, Homeland Security, Interior and other agencies.

On a single night in January 2009, there were about 643,000 homeless people, the report said. At least seven agencies spent about $2.9 billion on more than 20 programs in 2009 to help the homeless with shelter or housing aid.

“Some programs may offer similar types of services and serve similar populations, potentially leading to overlap and fragmentation,” the GAO said.

In the area of job creation, there are about 80 economic development programs spread among the Departments of Commerce, Agriculture, Housing and Urban Development and the Small Business administration.

Those 80 programs cost $6.5 billion last year. Of that amount, $3.2 billion were for economic development, in the form of grants, loans and loan guarantees. About 52 of the programs were aimed at “entrepreneurial efforts.”

Of the 80 programs, auditors said “the design of each of these fragmented programs appears to overlap with that of at least one other.”

To contact the reporters on this story: Roger Runningen in Washington at rrunningen@bloomberg.net; Cathy Dodge in Washington at Cdodge1@bloomberg.net.

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net.

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