The federal government has squandered an astronomical sum on improper payments over the past two decades, according to a new analysis that is drawing fresh scrutiny to Washington’s spending habits.
Between 2003 and 2023, the Government Accountability Office (GAO) estimates that agencies made $2.7 trillion in erroneous payments — funds doled out in the wrong amount, in error, or without proper documentation, according to a report from the Cicero Institute titled “Rebuilding Public Trust by Ensuring Accountability in Government Spending.”
The jaw-dropping figure, highlighted this week by PJ Media’s Steve Green, underscores a persistent problem that has only worsened over time. To put it in perspective, $2.7 trillion is nearly double what the government spent last year on Medicare and Medicaid combined, or on Social Security. It’s roughly triple the defense budget and almost triple what the U.S. paid just to service its national debt.
The sum is also almost exactly what Washington collected last year in personal income taxes — an irony not lost on critics who argue taxpayers are footing the bill for bureaucratic incompetence.
Treasury Secretary Scott Bessent has estimated that up to 10 percent of the federal budget is lost to fraud, citing a GAO analysis of 2018–2022 data that put annual losses between $233 billion and $521 billion, the Cicero report noted.
Inflation-Adjusted Numbers Are Even Worse
Green points out that the $2.7 trillion figure is not adjusted for inflation, and when you factor that in, the total balloons to $3.325 trillion — nearly a quarter more. Extending the timeline through 2025 and applying current inflation adjustments pushes the total to approximately $3.9 trillion through 2026.
That’s a staggering sum, especially when you consider that the entire federal budget, in constant dollars, did not exceed $3.9 trillion until 2017.
The problem has grown consistently over the years, with a notable spike during the 2020–2021 COVID-19 pandemic, when emergency spending opened the floodgates to fraud and mismanagement.
Political Reaction and the Limits of Fraud Reduction
The findings have ignited fresh criticism of both parties. Guy Benson, a conservative commentator, called the situation “a disgrace,” writing on social media that “Republicans are the fiscally irresponsible party, Democrats are the fiscally insane party.” He added that meaningful solutions are “demagogued to the hilt,” pushing the nation “further toward the fiscal abyss.”
However, Green cautions against the idea that eliminating fraud alone would solve the nation’s fiscal woes. While the $3.9 trillion in improper payments is staggering, Washington has added more than $33 trillion in new debt since 2003 — about eight and a half times the amount wasted.
“While I don’t doubt there’s more fraud to be found, particularly in federal healthcare spending, it seems unlikely to come anywhere close to our annual $2 trillion-plus deficits,” Green writes.
The real problem, he argues, is a combination of voters demanding more spending than the country can afford and politicians unwilling to say no.
Source: pjmedia.com — https://pjmedia.com/vodkapundit/2026/08/20/im-sorry-the-feds-wasted-how-many-trillions-in-improper-payments-n4956344
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