Fraud in Government

We occasionally hear about fraud in business. Most often, however, there are checks and balances in business. The boards of directors. Or the independent audits. When an Enron and WorldCom occurs, the publicity and media extravaganzas, along with government finger-pointing publicity, make up for any smaller, relative numbers.

We hear about fraud in government but the incidents are too often taken for granted. Nevertheless, it is far more prevalent where politicians and bureaucrats take it as a given that they are being underpaid on the job.

One example: There is a formula for how government grants are used. There always is some allowance made for “waste.” Take that as an appropriate euphemism.

And there is always an understatement of projected cost. It is a rare government project that ever meets its original cost estimates.

Then there is usually some figure allotted to account for missing funds. Or at least a few percentage points devoted for investigation of fraud.

That is because of the psychological nature of government jobs. You do not have the same checks and balances than in private industry, despite the public image the media may afford.

Lastly, government projects are always begun and ramped up. Very few are ever terminated. Sunshine laws are passed from time to time but appear ineffectual. Once on the books, laws seem to have a life of their own. Along with agencies they breed.