“Use it or Lose it” is a Bad System

The system encourages waste. Here are my ideas to fix it.

It is a popular delusion that the government wastes vast amounts of money through inefficiency and sloth. Enormous effort and elaborate planning are required to waste this much money.

― P.J. O’Rourke

While I was stationed at Misawa Air Base in Japan, I served as the fiscal and contracts law attorney. My job was to review purchase contracts (stuff the Air Force wanted to buy) and assess the legality of spending federal funds on those contracts.

My big lesson was that our system incentivizes wasteful spending by penalizing government agencies that fail to spend all the funds provided by Congress.

Other federal employees or workers in large organizations know the phrase: “Use it or lose it.” Every September, it rains money as all departments rush to burn through whatever budget they have left. In 2003, I was actually denied leave for the month of September to handle the swell of contracts coming.

This system is dumb. Everyone knows it, and everyone hates it. The September Splurge encourages belt-tightening throughout the fiscal year, and it incentivizes enormous waste right at the end. It prevents government agencies from thinking ahead, which prevents the development of new ideas, practices, or policies that might make them more effective and efficient.

The budget-waste problem has its roots in the Antideficiency Act (ADA, or AdA, to distinguish it from the Americans with Disabilities Act). First adopted in 1870 and fully articulated in 1884, the AdA governs how and when a federal agency can use funds appropriated by Congress. It was originally intended to prevent the executive branch from spending money the legislative branch didn’t approve.

As South Dakota’s Independent candidate for U.S. Senate, I feel an obligation to offer some ideas that would never see the light of day in either of the two major parties. America needs more brainstorming (or Brianstorming?) to find powerful and innovative ways to solve the structural problems our country faces. Positive or negative, I want your thoughts.

Here are my ideas:

1. Extend budget period terms from one fiscal year to two, OR,

2. Eliminate the expiration date on appropriated funds entirely.

The AdA is the incentive for executive branch agencies to burn through unused funds before they expire. This lets subpar contracts slip through, it stresses out government employees, and it just wastes money.

Another problem I can directly address as South Dakota’s Independent Senator is the fact that Congress doesn’t actually create new budgets, it builds them piecemeal. The last time all 12 required appropriations bills were passed before the September 30 deadline was 1997. This exacerbates the “use it or lose it” problem.

Even small inefficiencies in such purchases amount to large dollars when applied across the federal government’s roughly $7 trillion annual budget. The problem isn’t spending in and of itself, it’s how and when we do the spending.

The effects of wasteful spending go beyond a mere impulse to “save money.” We’re going to see the effects of the bad budget process when the bill for the war in Iran comes due. We’re going to see the debt keep rising. We’re going to see taxes stay at the same place they’re at, because your taxes can’t go down until the government knows it can afford them to.

I’ve seen government waste firsthand. Whether it was the September “raining money” season, or when the Air Force would reduce the officer pool only to offer cash incentives for officers to build it back up (burning money on both ends), it’s all wasteful. Anyone who’s built a household budget knows that better practices lead to better spending habits, and better spending habits lead to more savings.

I want to see more money in your pocket. I want to see the tax dollars you pay to the federal government put to good use. Government spending doesn’t have to be so wasteful, and it doesn’t have to be so reckless just because a yearly deadline makes it so.

Simply extending appropriations to a two-year availability window would reduce these incentives. Ending the “use it or lose it” system might actually produce some savings, which can be used to pay down the debt, balance other areas of the budget, or even give you a tax break.

If you’ve read my articles before, a question may have crossed your mind: “This guy may work well for South Dakotans, but that’s just one state. What will Brian Bengs do for me?” Over roughly 750 words, I hope I’ve partially answered that question.

What’s good for South Dakotans is good for Americans. What’s good for Americans is good for America.

I got into this race in the first place because I saw reckless cuts to low-hanging fruit in the government in the name of curbing “waste.” Sure, the low-hanging fruit is easy, but we don’t send elected officials to Washington to do “easy.” The obvious fixes are hard, but that’s an uphill battle I’m more than willing to fight.

Thank you for reading.

Brian L. Bengs, Lt Col (Ret.)

Independent Candidate for U.S. Senate

I can win this race. South Dakotans like my ideas and they’re ready for someone new to step up. However, I need help spreading the message across the state. Consider contributing to my campaign to help me show Mike Rounds he can’t take South Dakota for granted.