The Department of Defense to Be Hit With an Audit for the First Time Ever

The Department of Defense is set for an audit, which may uncover some unsettling things.

The Department of Defense is set for an audit, which may uncover some unsettling things. | Warner Bros.

Americans don’t like to pay taxes. And they really don’t like when that money is wasted — however they choose to define that term. Every pay period, the majority of working America forks over a portion of their paycheck to the government to pay for things like roads, bridges, and social programs. Though we actually pay relatively a relatively low tax rate compared to many other countries in the world, there is one area in which the American government outspends all others: The military, or through our Department of Defense.

You’ve heard it before: The United States outspends the rest of the world on its military. And by a wide margin. When you break it down all the way to the individual taxpayer, in fact, the figures are pretty striking. According to the Pentagon, we’ve spent $1.46 trillion on “war-related costs” since 2001 alone. But actual expenses are much higher — $5.6 trillion, according to a report from Brown University.

That, too, is only a fraction of the D.O.D. budget. All told, the Department of Defense has something like $2.2 trillion in assets and has an annual budget of around $600 billion. That’s an awful lot of money, and there’s an awful lot of opportunity for that money to “fall through the cracks.”

What does it mean from the average American’s perspective? They want an audit, naturally. And an audit is exactly what they’re going to get, as the Department of Defense and Pentagon have announced that the department will undergo a financial autopsy next year. For the first time ever. What does that entail, how will it work, and what will they find? We’ll get into it all.

First up: The D.O.D.’s first audit. Ever.

A Department of Defense audit for the first time

U.S. Secretary of Defense Jim Mattis

U.S. Secretary of Defense Jim Mattis will have to deal with increased scrutiny and open books. | Alex Wong/Getty Images

Many taxpayers are probably wondering why this is the first time the D.O.D. is being audited. It’s a good question, but the apparent straw that broke the camel’s back was the uncovering of $21 trillion in spending by the Defense Department and HUD. A Michigan State University economist, digging through the government’s finances, found the discrepancies. He brought the findings to light, which has helped spur support for the audit.

Now, $21 trillion is an incredible amount of money, so it’s important to note that the money didn’t simply disappear. It’s more likely that fancy accounting work helped cover up unauthorized spending, and D.O.D. officials helped cover it up. With that said, taxpayers should be happy an audit is finally happening.

Next: What will the audit entail?

Logistics of the audit

The seal of the US Department of Defense

The seal of the US Department of Defense is seen at DAR Constitution Hall in Washington, DC, November 28, 2016. |
SAUL LOEB/AFP/Getty Images

  • 1,200 auditors will be involved in the gigantic undertaking.

The audit will be, in the D.O.D.’s own words, massive.”It will examine every aspect of the department from personnel to real property to weapons to supplies to bases. About 1,200 auditors will fan out across the department to conduct it,” a D.O.D. release said. “Audits are necessary to ensure the accuracy of financial information. They also account for property. Officials estimate the department has around $2.4 trillion in assets.”

In addition, this will be the start of annual audits for the Defense Department, shining more light onto where Americans’ tax dollars are going on a regular basis. More transparency, particularly around the financials, is a good thing. Of course, officials may need to weather the storm after the initial findings are released next year.

Next: What are auditors expecting to find?

What do they expect to find?

Will the audit reveal X-Files-level oddities? | Fox

Audits are all about managing expectations. When you dig in, you have a good idea of what you’ll find — the audit is taking place in order to find the things you don’t expect. When it comes to the Defense Department, however, we don’t really know what to expect. We know some items that are going to be in the report, like military base maintenance and management, personnel, research and development, etc. But what we’re all wondering about, naturally, are those secret, black projects and black holes that eat up billions of dollars.

Next: What about all of that “dark money”?

The “black budget”

There’s a lot going on at the Pentagon that we don’t know about. | U.S. Air Force/Getty Images

  • The “black budget” is what everyone’s wondering about: Money that is allocated to secret and classified projects.

Area 51, the Dugway Proving Grounds, and HAARP — if any of these ring a bell, you’re probably familiar with the concept of a black budget. This is the money that gets allocated to secret projects, and what many people are curious to see once auditors complete their work. Of course, we probably won’t get to see much (if anything) in regards to specific projects or expenditures. We’ve had glimpses at the projects before, with a Washington Post report digging into it and finding that a total of $52.6 billion being spent primarily by a handful of agencies.

But who knows what else could be out there? Recently, we actually got a glimpse.

Next: Need an example?

Example: A recently revealed UFO program

ufo abduction

Are we being visited by little green men? | homeworks255/iStock/Getty Images

Some of that “black money”, as has been recently revealed by the New York Times, was funneled into a secret UFO project called the Advanced Aerospace Threat Identification Program. At $22 million it wasn’t cheap, and the program itself ran “officially” from 2007 until 2012, though some sources told the Times that it remains active. But when it comes to budgets and financing, the biggest red flag in the report is that the program was requested by former Nevada Senator Harry Reid. And a lot of the money funding the project ended up going toward one of Reid’s friends — a billionaire with an interest in extraterrestrials.

This is exactly the kind of thing many are hoping will be dug up through an audit. But this is only one small program. What else is out there?

Next: What else could be uncovered?

It’s more than chasing flying saucers

Is Boeing among the companies cashing in on secret government projects? |  TOSHIFUMI KITAMURA/AFP/Getty Images

  • $22 million to chase UFOs is a drop in the bucket of the $52 billion black budget.

We know that we’re spending millions chasing UFOs. But again, that’s just one (relatively small) piece of the puzzle that is the D.O.D. budget. There’s no telling what else could be unearthed, but you can probably expect more self-dealing and handouts, like the apparent relationship between Harry Reid and his billionaire pal. We already give defense contractors like Boeing and Lockheed Martin billions for research and development purposes, and we’re likely to see a lot of big contracts come to light. Assuming, of course, that they aren’t marked “classified”.

Finally: What could happen as a result of the audit?

Reform?

President Donald Trump stands with with Secretary of Defense James Mattis.

President Donald Trump and Secretary James Mattis want to see an increase in defense spending. | Mark Wilson/Getty Images

  • Will an audit’s findings spur enough anger to change defense spending?

There’s a reason that so much of the Defense Department’s spending remains under wraps. Sure, there are security and secrecy issues to contend with, but another is that people would be angry if they saw how much of their money was being sloshed to and fro between contractors. As for changing or reducing defense spending? Don’t count on it. There’s already an appetite for cutting defense spending, but Republicans — including President Trump — are actually pushing for the opposite.

Rather than a reduction, you can probably count on an increase in D.O.D.’s budget in the near-term.

Follow The Cheat Sheet on Facebook!