Episode 45: Can America Control Inefficient Government Spending?

Edit

Scott Vicknair, injury attorneys, we fight for the win.

Good morning everybody. Welcome to the Overruled podcast, brought to you by the Scott Vicknair Law Firm. This is David Vicknair along with my co-host and law partner, Brad Scott.

Good morning, Brad. How are you doing?

Good morning, everybody. I’m doing pretty well.

Well, I understand, you know, we make it a rule, which maybe our listeners don’t know. We make it a pretty big rule that we don’t talk about politics as much as we can avoid it on this podcast and maybe if we do feel like we’re dipping our toe in it, we’re going to be agnostic and do it from a high level view that doesn’t become partisan.

But, when you discussed with me what you wanted to talk about today, I was kind of on board because this isn’t really partisan. You want to talk about something that Democrats hate, Republicans hate, independents hate, agnostic people who are libertarians, Green Party, anything hate, and it’s the one thing that probably spans all people, no matter how invested they are in the federal government or not, or how much they pay attention or not, or how much they care or not.

The one thing that bridges all gaps is what, Brad?

Inefficient government spending.

Inefficient government, yeah. So your point, we’re not talking politics. I don’t care which side of the aisle you’re on with your Republican, Democrat or other, whatever. But the government is insane in what they’re spending these days.

And this doge entity, whatever you want to call it. What is it?

I do have to ask, like, I keep seeing snippets about doge and I know generally the concept I think is that Elon Musk, is introverted and unique as he is. He is no doubt, I think everybody would admit brilliant.

But I know he’s going to be involved in this pseudo government entity, which is essentially going to, what I was getting at is everybody hates government waste, right? Everybody hates that we waste money on things that everybody, no matter their political affiliation, will be like, really? The government’s spending that much money on that?

And I understand it as this pseudo entity of the government that’s going to try to cut wasted spending. Is that fair?

Essentially, yeah. It’s the Department of Government Efficiency. And basically, this is the scalp. They’re bringing out to the budget. And they’re going through and that’s why it can become kind of became a topic for me.

I’m seeing all these news articles and things that are being cut and it’s like, my God, how did this ever get approved to begin with? Whether it was Republicans or Democrats or whoever, but the stupid stuff we spend money on is ridiculous.

And if you remember when Musk took over Twitter or whatever the company was, he took over, he went through and he cut it tremendously. He cut the workforce, he cut the budget, and it works better than it was before.

So, you know, it’s time to take out the scalp and start peeling back the layers and seeing where we’re wasting money.

And to be honest, I mean, if government was a business, these people across the board would be fired for the job they’re doing as far as the fiscal policy that they’ve had in place.

But just to kind of throw out some big numbers, the 2024 government spend is 6.7 trillion dollars. That’s what the government spends.

Just in 2024?

Just in 2024.

That is a hard number to wrap your head around. But if you take it and you do a little math and there’s 525,000 minutes in a year. So that works out to get this. $12 million per minute that the US government spends to keep the government operating.

That is an insane amount of money every single minute. I mean, we’ve been on this podcast for what? Four to five minutes. So we just spent $60 million of the government’s funds just since we’ve been talking.

Well, as I understand it, Brad, the biggest concern has been over the last five to 10 years, especially, and this isn’t, by the way, this spans both Republicans and Democrats, is the increased percentage of spending relative to GDP growth.

Meaning, if the economy grows at a certain percentage every year, which our economy does, and we’ve actually been in a really good cycle for the US economies performance versus the foreign economies performance. If we grow at 2.5, 3, 3.5 percent, whatever GDP, there’s got to be a healthy relation of government spending relative to GDP growth in our economy.

And I remember watching CNBC, which I watched pretty often in the mornings after I work out, seeing a chart of the relative imbalance over the last five, 10 and 15 years and how much our spending has increased comparatively to GDP growth, which is the most important concern that a lot of economists on both sides of the aisle, Republican, Democrat, independent, whatever, have been sounding the alarm bells on.

Is that right?

Yeah, I mean, it’s just basic common sense. I mean, if you look at your own household budget, you can’t spend more than what you’re making and bringing in. You can’t for a period of time.

You can get credit cards and loans and stuff like that, but unless you increase your income, and if your expenses keep increasing while your income is stagnant or not growing at the same rate, you’re going to have fiscal problems.

And the government has continuously spent more than they bring in every single year.

So, this is the whole concept with Elon Musk and this doge type of program, they want to go through and see where we’re wasting the money, what can be cut, what’s not needed.

They’re proposing right now, $500 billion in annual spending they’re trying to cut. That works out to about 7% of the budget. It’s not a big chunk, but it’s still something, you know, at least going in the right direction if this is successful.

Now, you know, I’ve seen that they’re doing some spending freezes and things like that and the judiciaries getting involved, some courts are starting to try to block some of this stuff.

So they’re in for a political fight of their lives to do this stuff. But I think whether you’re Republican or Democrat, it’s heading in the right direction.

Some of the stats I pulled, and this was mind boggling when I saw this, just in the year 2022, the government made erroneous payments of $247 billion.

Wow.

This is money they spent on improper payments that were not supposed to be made. They paid people that were no longer eligible for certain programs, their payments kept going, because they might inflict the button to turn them off.

They paid dead people. I mean, $247 billion worth of money that should not have been spent, they still made erroneous payments on.

Who’s asleep at the wheel allowing this kind of stuff to happen? It’s insane.

In 2023, it was $236 billion. Since 2003, the last 22 years, they have erroneously paid out $2.7 trillion of taxpayer dollars that we’ve been taxed on and given to the government, they have inappropriately gave to people who didn’t even owe the money.

These are the kinds of things we just got to get a handle on.

You know, and I’ve been seeing all kinds of, you know, news flashes of things that Doge has spotted that they’re cutting.

There was $12 million that was granted for pickleball courts in Las Vegas. You know, that’s a great expenditure of our federal dollar because you and I are going to benefit from that in Las Vegas, right?

It’s just it’s insane type of stuff that you’re seeing.

These and then one of the studies I saw from the GAO office, the Government Accountability Office, they talked about these ghost towns on the government’s dime type of thing.

They calculated that almost 50% of the government offices are underutilized or not being used. We’re basically spending money to house empty desks.

I forgot how much it came out to be. It was almost $10 billion dollars yearly that we’re spending to pay for real estate that we’re not even using.

Yeah. The inefficiencies go on and on as far as the amount of money that’s just being spent on things that just should not be spent on.

I think we’re way, way overdue for these types of cuts. Like I said, whether you’re a fan of, you know, Donald Trump or not, I’d rather keep more money in my pocket.

If this was our pocketbook, we’d be a lot more careful in what we’d be spending these dollars on.

Yeah, unfortunately, you know, the problem has been born by everybody. And nobody wants to stop, like to, I remember when earmarks were banned because earmarks were really abused.

And those were like pet projects that were sent to different congressmen and senators that, you know, when you really looked at, was that an efficient use of government resources? A lot of times it wasn’t.

And in the famous one, you know, rest in peace, was that famous senator from Alaska, Ted Stevens, who built that bridge to nowhere. That was a big one down, I think they spent 50 or $60 million on a bridge that literally went nowhere.

But, you know, I guess there’s always going to be government waste and efficiencies, right?

But the number, which you say from 2003, the 2.7 trillion in on that’s kind of staggering. And I think what people, myself included, just generally want from the government is be as efficient as possible, recognizing no different than a business that the government is going to have some waste, it’s going to have some mistakes and inefficiencies, but minimize it to a percentage of overall spending that is more palatable than something in the hundreds of billions or trillions.

I mean, that’s really unacceptable. And the numbers are staggering. And it’s ridiculous.

And I would hope, you know, no matter the political party of any administration, that they continue to try to bring that down to a percentage that is not at that size of a number.

And really, you know, if, if you there are certain pieces of the federal government that you like or you believe it’s strongly in should be protected, whether it’s Social Security, Medicare, Medicaid, different federal housing grants.

I see a lot of the, a lot of the block grants from the federal government that are issued down to Volunteers of America, for example, for affordable housing, which have incredible efficacy in allowing pseudo governmental groups and nonprofits to deliver safe, affordable, clean housing to people who are still paying, but have partial government vouchers, right?

There’s certain things that do work well and the government’s doing well.

And you just don’t want to see this percentage of our money being wasted because you’d rather us save it, not spend it, or allocate it to things that do deliver goods to our citizens that help them make their lives better, make them safer, feed them, that type of thing.

So.

Yeah, you’ve got to be smart with your spending. I mean, and like any business out there who’s successful, usually annually you go through your budget and you start reviewing things that you may have approved for spending before, but do we still need these things? Are they giving us benefit? Are we getting a return on our investment? Do we still want to spend our dollars this way?

And I think the problem with government is it’s like, most of these politicians, no matter which side of the aisle they’re on, they’re on. They’re like teenagers with daddy’s credit card. You know, they just don’t care. It’s not their money that they’re spending and there’s really no accountability.

Nobody’s been looking over their shoulder and questioning them.

And, you know, like it is in government, as soon as you fund something and you create a budget, it’s hard to pull that money back. And it just keeps getting renewed every single year, so the budget keeps growing and growing and growing.

There was some claims out of the Trump administration last week or two about, they stopped over $50 million worth of condoms from being shipped to Gaza.

You know, now whether that’s true or not, there was some, some information back and forth on that, but why would we be spending $50 million to send condoms to Gaza if that was actually what was happening?

And who knows if that’s true? I saw that and was like, it’s really hard for me to believe that. But it’s probably anchored in something.

Why are we spending all that money overseas for things like that? There’s so many needy things in our country, whether it’s veterans or people who need our help that money can be spent much better.

So, it’s time to pull back the curtain, look at this spending and really be critical of how we’re spending our dollars. Like it’s our own dollars because it is.

There’s not an unlimited pool.

You know, I would assume if they start doing this stuff, we could be a lot more efficient. It’ll be interesting to see what happens with Doge and Elon Musk and how much attraction they get with these cuts and if it really does take place.

I’d like the way it’s heading though. Like I said, regardless of your political affiliation, I think this is way, way overdue and it is very much needed.

Yeah, I remember back when President Obama was in office, he had a bipartisan commission that he put together with actual power to some, as much as he could, which was a Democrat and Republican senator.

I think it was the Simpson-Bowles commission, and they put together a comprehensive proposal to rein in the federal deficit and spending and of course politics poisoned.

The reason I hate politics, it poisoned any real achievement coming from that effort to truly decrease federal deficit and government spending and get rid of waste and efficiencies.

They were targeting a lot of the stuff that we talked about at the outset of Doge, like, really first going after, hey, can we make a dent, whether it’s 10, 20, or a hundred billion.

Like how much can we eliminate that’s truly just wasteful and excessive spending, right? Let’s start there.

Before we go hit some of the meatier things that would take a dent in it, but are going to be more difficult politically. Defense, Medicare, stuff like that.

Things that you don’t want to have to touch.

Yeah, they’re hard, but because of the politics of it all.

And unfortunately, you know, that was a noble effort and there was a lot of hard work done, but like it really didn’t achieve much because politics infected that process.

And so what’s going to happen with this? I have no idea, but like, at some point in time, whether it’s this person who’s in the office or it’s the next person, like, there’s going to have to be a sincere effort at truly bringing down our deficit spending to match GDP growth so that our kids, their grand, their kids are not facing a debt situation which would severely weaken us with real adversaries like China and imperil the future of the country.

So, it’s going to be fun to watch. I’m interested to see what happens. Just, if nothing else, other than the fact that Elon is Elon, and you really never know what he’s going to do or say next.

And it’s kind of like a pseudo genius who’s unhinged and going to say anything at any moment, and you never know what’s going to happen.

So,

Well, talking about the debt, just to make a quick point on that, we spent $659 billion last year paying interest. On the national debt.

We borrow $3 million every minute more than what we spend, or we collect in income tax. So that’s how far out of whack our budget is.

And, you know, I think it’s got to come from us, as citizens of the country, we got to put pressure on these politicians to straighten this up, or fire them.

Whether the Republican or Democrat, they have to get the house in order.

Yep.

Well, it’ll be interesting to see what Doge does. Is there a Doge coin? Did I make that up in my head?

Now, there is.

Why is there a coin for everything now? I, maybe need an SV, Scott Vicknair coin.

Apparently, the coins or the thing of the, the hot thing of the day, as the kids would say.

So, anywho, it’s been an interesting discussion. It’s going to be fun to watch.

Thank you, Brad, for, getting all revved up about wasteful government spending. I haven’t seen you this animated in maybe two and a half months.

So.

I’m cheap. I hate spending money. This is just, this gets me.

As always, thank you to all of our listeners for listening. This has been the Overruled podcast brought to you by the Scott Vicknair Law Firm.

Thank you so much for listening along with us. We can’t wait to see you next time. Y’all take care.

Scott Vicknair, injury attorneys, we fight for the win.

Information is for illustrative purposes only and does not constitute tax, investment, or legal advice. Always consult with a qualified investment, legal, or tax professional before taking any action.