Milwaukee Rising

The federal government is spending hundreds of billions of dollars to get us out of this recession, and promises to keep strict track of where it is going and how it is spent.

It’s just all those other trillions that the feds can’t fully explain.

Government bookkeeping is so bad that the Government Accountability Office can’t determine just exactly what our national fiscal condition is.

“Certain material weaknesses in internal control over financial reporting and other limitations on the scope of our work resulted in conditions that prevented us from expressing an opinion on the fiscal year 2009 and 2008 financial statements other than the Statements of Social Insurance,” Acting Comptroller Gene L. Dodaro reported last week, adding that “Material weaknesses resulted in ineffective internal control over financial reporting (including safeguarding of assets).”

Makes you feel happy about paying those federal income taxes, doesn’t it?

Reading Dodaro’s statement makes you wonder why some of these people have jobs. The GAO, Dodaro said, can’t render an opinion on the government’s financial statements for three big reasons:

(1) serious financial management problems at the Department of Defense (DOD) that have prevented DOD’s financial statements from being auditable, (2) the federal government’s inability to adequately account for and reconcile intragovernmental activity and balances between federal agencies, and (3) the federal government’s ineffective
process for preparing the consolidated financial statements. In addition, the financial statements of the Department of Homeland Security and the National Aeronautics and Space Administration for fiscal years 2009 and 2008 were not auditable or were not subjected to audit by agency auditors.

The federal government could not determine exactly how much in “improper payments” it was making, although the amount is estimated at $98 billion, nor could the government ”reasonably assure” that appropriate action is being taken to stop them.

The government also could not identify and resolve information security control deficencies or — ready for this one? — “effectively manage its tax collection activities.”

The GAO sounds a very loud warning that both parties in Congress have thus far elected to ignore:

Looking ahead, the federal government will need to determine the most expeditious manner in which to bring closure to its financial stabilization initiatives while optimizing its investment returns. In addition to managing these actions, problems in the nation’s financial sector have exposed serious weaknesses in the current U.S. financial regulatory system, which, if not effectively addressed, may cause the system to fail to prevent similar or even worse crises in the future. The current system, which was put into place over the past 150 years, is fragmented and complex and simply has not kept pace with the major financial structures, innovations, and products that emerged during the years leading up to the recent financial crisis. Consequently, meaningful financial regulatory reform is of utmost concern.

All this is really scary stuff, brought to the country by one of the most credible sources there is. Anybody in Washington listening?