Pentagon Lost Billions, Pennies At a Time 323
Hugh Pickens writes "MSNBC reports that in 1969, Walter T. Davey, an aeronautical engineer at North American Rockwell, discovered he was being overpaid by roughly 2 cents an hour, or one-third of 1 percent of his pay. Davey submitted the discovery to his superiors and suggested a simple fix. 'It was so simple to correct,' said Davey, a 79-year-old retired Air Force colonel, 'just change a few digits in the coding software.' The Project on Government Oversight, which reviewed Davey's findings last year, estimated the change could save taxpayers $270 million a year. Multiply by 40 years — the length of time since Davey made his discovery — and the figure grows to an astounding $10.8 billion. Legislators ignored Davey's letters, federal auditors deferred to Congress, and lobbyists 'descended on it and tore it into a piece of Swiss cheese' but legislators aren't eager to challenge the powerful defense lobby about a figure that's a relative pittance in the overall defense budget — even if it exceeds $100 million annually. 'A lot of people have taken advantage of the system to reap as much in taxpayer dollars as possible,' says Scott Amey, general counsel for the Project on Government Oversight. 'But when you're going up against the contractor lobby — whether you're an individual across the country or a public interest group or a government employee — it's a tough road.'"
It's not directly comparable (Score:4, Interesting)
Re:Ironic, really... (Score:5, Interesting)
Also, don't forget that anything major project is managed according to this chart [dau.mil]. :-)
Now the fun part... Try and find the boxes in the diagram where something functional actually gets built!
Correct link: http://www.dau.mil/pubs/IDA/chart%20front.pdf [dau.mil] ... and I have to say: wow.
This is why military projects start at $billions and go up from there.
Most fantastic pile o' loot on the planet (Score:3, Interesting)
The American taxpayers' dollars are the single most fantastic pile of loot on the planet. It is so big that pilfering it is a full-time job for millions of people. It's like a horde of scavengers around a perpetually gushing cornucopia.
Defense contractors are not even the big time scavengers here. No, the real T-Rexes in this game are the Federal employee unions, believe it or not. A defense contract comes and goes, and is generally audited. A union benefit is forever.
Disclaimer: I have nothing personally against unions, contractors or T-Rexes.
Re:It's not directly comparable (Score:3, Interesting)
We're not really comparing the cost of goods, but the devaluation of the dollar. i.e. A dollar in 1910 is equivalent to just 4 cents today; it's lost 96% of its purchasing power. The excess printing of money has led paper to lose value rapidly. (Whereas an ounce of gold both then, and now, could buy you a brand-new suit. Gold is relatively stable.)
Anyway I came-up with $6 in 1969 is equivalent to $39 today, which is just shy of what I get as an engineer.
Re:overpaid? (Score:5, Interesting)
Both funny and insightful.
To put it another way, government employees don't pay taxes, they're payed out of taxes. The fact that they fill out taxes is merely an accounting trick.
Re:overpaid? (Score:3, Interesting)
you have to be carefull comparing old prices in the uk because of the change in the value of the pound though decimalisation
How did decimilizing the pound change its value? It seems to me that only the value of the pence changed.
(Under the pre-decimal system, there are 20 shillings in a pound and 12 pence in a shilling which makes 240 pence in a pound. After decimilization, there are 100 new pence in a pound.)
Re:Ironic, really... (Score:3, Interesting)
Re:It's not directly comparable (Score:3, Interesting)
We're not really comparing the cost of goods, but the devaluation of the dollar. i.e. A dollar in 1910 is equivalent to just 4 cents today.
Ah, yes, but it's not that simple.
4 cents placed in a plain-old savings account would actually also equal [measuringworth.com] a dollar today. If you don't want your money to lose value, put it in the bank, and forget about it -- savings rates appear to have kept up with dollar's declining purchasing power.
Invested in bonds or an index fund, that $0.04 would now be worth $9. A 9x return on any investment (adjusted for inflation) is considered to be phenomenal.
Inflation drives the economy forward. There are numerous safeguards in place to prevent it from biting you in the ass. Stagflation [wikipedia.org] can still be a problem, although there are numerous theories about how to deal with this, should it appear again to the extent that it did in the 1970s.
Re:overpaid? (Score:1, Interesting)