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Pentagon Lost Billions, Pennies At a Time

timothy posted more than 5 years ago | from the different-kind-of-cuckoo's-egg dept.

The Military 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.'"

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overpaid? (5, Funny)

notgm (1069012) | more than 5 years ago | (#27814195)

he made $6.00 an hour, and he was complaining about being overpaid?

nice.

Re:overpaid? (5, Funny)

sopssa (1498795) | more than 5 years ago | (#27814217)

Well, as a tax payer he probably get fed up paying too much taxes towards his own salary.

Re:overpaid? (5, Interesting)

Arthur B. (806360) | more than 5 years ago | (#27815389)

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? (1)

sharkey (16670) | more than 5 years ago | (#27814219)

I'm not an expert on finance or inflation, but $6/hr in 1969 might have been a fairly decent wage.

Re:overpaid? (4, Informative)

mikael (484) | more than 5 years ago | (#27814255)

My parents bought their first apartment for 6000 pounds back in 1966. Today, the same property is worth around 200,000 pounds. Salaries followed a similar path. $6/hour then would be like $20/hour now.

Re:overpaid? (1)

wjh31 (1372867) | more than 5 years ago | (#27814337)

you have to be carefull comparing old prices in the uk because of the change in the value of the pound though decimalisation

Re:overpaid? (3, Interesting)

David Chappell (671429) | more than 5 years ago | (#27815471)

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:overpaid? (1, Insightful)

Anonymous Coward | more than 5 years ago | (#27814507)

My parents bought their first apartment for 6000 pounds back in 1966. Today, the same property is worth around 200,000 pounds. Salaries followed a similar path. $6/hour then would be like $20/hour now.

That isn't exactly a similar path, but its a fairly accurate view of how unaffordable property in the UK has become and why we were well overdue a crash. The only problem is the crash won't be big enough to take things back to the 1960's level of affordability.

Re:overpaid? (5, Informative)

mangu (126918) | more than 5 years ago | (#27814513)

Your parents did a very good business. After correcting for inflation [measuringworth.org] , those 6000 pounds became 80000, which means your parents got 6.5% / year interest in real value plus free rent for over 40 years.

Re:overpaid? (5, Insightful)

quenda (644621) | more than 5 years ago | (#27814555)

6000 pounds back in 1966. Today, ... 200,000 pounds. ..$6/hour then would be like $20/hour now.

Nice, only off by an order of magnitude. Try $200. A pity salaries have not increased like house prices.

Re:overpaid? (2, Informative)

suso (153703) | more than 5 years ago | (#27814681)

My parents bought their first apartment for 6000 pounds back in 1966. Today, the same property is worth around 200,000 pounds. Salaries followed a similar path. $6/hour then would be like $20/hour now.

200000/6000 != 20/6

Re:overpaid? (0, Flamebait)

onionlee (836083) | more than 5 years ago | (#27814847)

dont know about you, but thats still pretty shitty.

Re:overpaid? (2, Funny)

cayenne8 (626475) | more than 5 years ago | (#27814911)

"dont know about you, but thats still pretty shitty."

Really....I mean, we 'could' be giving all this money to ACORN. [rolls eyes]

Re:overpaid? (4, Informative)

srealm (157581) | more than 5 years ago | (#27814263)

According to http://data.bls.gov/cgi-bin/cpicalc.pl [bls.gov] .. $6/hr in 1969 is equivalent to $34.78 today. I read it on the internet, so it must be true! :P

So not too shabby. Not omgwow!, but not exactly minimum wage either.

It's not directly comparable (3, Interesting)

Kupfernigk (1190345) | more than 5 years ago | (#27814521)

Be careful of these numbers. The range of goods and services available today are different, and this makes comparisons hard to evaluate. In 1969 my father earned about $5/hour. To live in the same house today with the same living standard, with his kids attending the same sort of schools and going to the same sort of university, he would need to earn around $100. This feels about right because his grandchild, in the same kind of job (but where pay rates have increased in real terms) earns nearer to $200/hour. This is because overall living standards have changed upwards. So my feeling is that $120/hour is nearer the mark.

Re:It's not directly comparable (2, Interesting)

theaveng (1243528) | more than 5 years ago | (#27815315)

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? (1)

TapeCutter (624760) | more than 5 years ago | (#27814591)

In '76 I used to dream of $5/hr (AU), now get off my lawn.

Re:overpaid? (0)

Anonymous Coward | more than 5 years ago | (#27814989)

I'm not an expert on finance or inflation, but $6/hr in 1969 might have been a fairly decent wage.

I started working a minimum wage job in the summer of 1969 for the princely sum of $1.20/hr. Also, gas was $0.20/gallone

Re:overpaid? (4, Informative)

Madball (1319269) | more than 5 years ago | (#27814283)

This was 1969. $6.00/hr (12,522/year) wasn't so bad. Equivalent in 2009 dollars is $34.87/hr (72,773/year).

CPI in 1969 (4, Informative)

mangu (126918) | more than 5 years ago | (#27814289)

You can get the official consumer price index, from 1913 up to now here [bls.gov] . $6 in 1969 would translate to approximately $36 today.

For older historical data, plus many other interesting historical data about prices and economic indicators, this site [measuringworth.com] is very interesting.

Re:CPI in 1969 (1)

theaveng (1243528) | more than 5 years ago | (#27815397)

Check out these graphs. They show how the consumer price index has been relatively the same from 1774 to 1900, and how from 1900 it has skyrocketed. What changed? We abandoned the stability of precious metals, and now we have paper currency which has devalued from 1 dollar in 1910 to about 4 cents today.

http://www.measuringworth.org/graphs/graph.php?year_from=1774&year_to=1900&table=US&field=DOLLAR&log= [measuringworth.org]
http://www.measuringworth.org/graphs/graph.php?year_from=1900&year_to=2000&table=US&field=DOLLAR&log= [measuringworth.org]
The entire span: http://www.measuringworth.org/graphs/graph.php?year_from=1774&year_to=2008&table=US&field=DOLLAR&log= [measuringworth.org]

Re:overpaid? (5, Informative)

Carbonite (183181) | more than 5 years ago | (#27814305)

His salary was equivalent to about $70,000 today, which isn't too shabby (though hardly "overpaid"). Also, the article mentioned that there was a financial incentive for discovering ways to save money. Davey admitted that he was hoping to get some award from his discovery.

Re:overpaid? (1)

maxume (22995) | more than 5 years ago | (#27814841)

It is also worth pointing out that he was attempting to cut his own pay by less than $50 (a day's pay at his $6 rate and some small amount more if you worry about taxes).

Re:overpaid? (1)

shadow349 (1034412) | more than 5 years ago | (#27814311)

he made $6.00 an hour, and he was complaining about being overpaid?

According to a CPI conversion table [oregonstate.edu] , $6/hr in 1969 is equivalent to:

$6/hr * 2080 hr/year / .172 * 1.022 = $74,154.42/yr in 2009 ($35.65 / hr)

Re:overpaid? (1)

kylegordon (159137) | more than 5 years ago | (#27814391)

When accounting for inflation, using this inflation calculator [westegg.com] , $6.00 an hour in 1969 is just over $33 an hour in 2007 money. That works out to be $68k a year, based on the articles 2080 hours per year figure.

So yeah, not a huge amount of money, but still a decent wage imho

Re:overpaid? (1)

impaledsunset (1337701) | more than 5 years ago | (#27814573)

I would say this is much significant. Two cents an hour per government employee is less than a cent an hour for each taxpayer. Looking at the final figure he saved each taxpayer one dollar a year. Not that much.

But it is still a cool story, though. It should be a pleasant feeling to be responsible for the saving of $270M a year. And certainly something to brag about.

However, did he save the taxpayers $270M, or did he cost the employees $270M? And are his fellow workers happy about this?

Besides that... (1)

denzacar (181829) | more than 5 years ago | (#27815077)

How exactly can one be OVERpaid for doing actual work.
Singers and movie stars get overpaid - the ones that earn millions for dicking around.

But being overpaid for doing an actual JOB?

Re:Besides that... (2, Insightful)

jlarocco (851450) | more than 5 years ago | (#27815341)

Singers and movie stars get overpaid - the ones that earn millions for dicking around.

How do you figure? If they sell a CD for $x and people agree to pay $x for it, then where's the problem? Who exactly are they ripping off?

But being overpaid for doing an actual JOB?

Well it's not too hard to figure out. He agreed to work for $x an hour, but was getting $(x+0.02) instead. In other words, he was making more money than he was supposed to, "real work" or not.

It's pretty basic stuff, really.

Re:overpaid? (1)

cooperaaaron (897474) | more than 5 years ago | (#27815201)

No idea where the money went (if this is true). No black projects, etc ???

Oblig.... (5, Funny)

pHus10n (1443071) | more than 5 years ago | (#27814235)

"Ok! Ok! I must have, I must have put a decimal point in the wrong place or something. Shit! I always do that. I always mess up some mundane detail."

Oblig 2.... (1, Funny)

AlpineR (32307) | more than 5 years ago | (#27814913)

Taxpayers: "This is not a mundane detail, pHus10n!"

government pay.. (0)

Anonymous Coward | more than 5 years ago | (#27814237)

just goes to show that small little amounts can add up when you have thousands upon thousands of people not willing to risk their 0.3%..

Michael Bolton.... (3, Funny)

VinylRecords (1292374) | more than 5 years ago | (#27814243)

http://www.imdb.com/title/tt0151804/ [imdb.com]

Sounds like the plot to Office Space but in reverse order.

Re: (1)

district (1470335) | more than 5 years ago | (#27814277)

Can we all agree to sent congress to federal pound-you-in-the-ass prison?

Re:Michael Bolton.... (3, Funny)

drinkypoo (153816) | more than 5 years ago | (#27814355)

Sounds like the plot to Office Space but in reverse order.

Richard Pryor has something to say to you.

Re:Michael Bolton.... (5, Funny)

sveard (1076275) | more than 5 years ago | (#27814397)

aka Richard Pryor Art

Re:Michael Bolton.... (1)

Covener (32114) | more than 5 years ago | (#27814607)

aka Richard Pryor Art

well done!

Re:Michael Bolton.... (1)

CheeseTroll (696413) | more than 5 years ago | (#27814959)

I believe we've just witnessed the birth of a new Slashdot meme.

Re:Michael Bolton.... (1)

jank1887 (815982) | more than 5 years ago | (#27815035)

Is there prior art for Pryor's art? (what is the first document case of Salami Slicing [wikipedia.org] )?

Re:Michael Bolton.... (1)

hesaigo999ca (786966) | more than 5 years ago | (#27814551)

Its the sad truth that the military will never bring back a budget that did not use up all its money...as this would show that it does not in fact need to keep being given so much, and could in
a stupid way of thinking , not get enough for the next year etc....when it might go over the budget ...etc..etc...

The dolts who plan the military are not accountants, but they are good at getting what they want....this is exactly why you do not want to keep giving them new projects, they always ask for more..

Re:Michael Bolton.... (-1, Troll)

Anonymous Coward | more than 5 years ago | (#27814811)

what the fuck does that have to do with michael bolton or office space, douchecunt? way to pick a random higher post to comment on so your biased opinions would be more visible. you are certainly an anal whore. die :-)

Re:Michael Bolton.... (1)

HomeLights (1097581) | more than 5 years ago | (#27815157)

I have a 'friend' who was in the Millitary and said they used to park the jets on the runway and just let them burn fuel because they had to spend the money if they wanted to get it again the next year.

Pennies floating in the system (-1, Redundant)

Drakkenmensch (1255800) | more than 5 years ago | (#27814249)

I'll get to work on coding a virus that will divert those pennies to my bank account. Write your own Office Space or Superman III joke here.

Re:Pennies floating in the system (1)

domatic (1128127) | more than 5 years ago | (#27814745)

You're just this penny-stealing, wannabe-criminal man.

MSNBC? (0)

Anonymous Coward | more than 5 years ago | (#27814273)

waste of effort. the story is a lie

Socialism!!!!eleventy-one11! (2, Insightful)

ciggieposeur (715798) | more than 5 years ago | (#27814275)

Explicitly allowing military contractors to overcharge the taxpayer to deliver broken systems on no-bid contracts is the heart of True Capitalism(tm) and A-OK.

Making it easier for employees to enter into unions so they can negotiate better pay/benefits within the constraints of market competition is Pure Socialism(tm) and Must Be Stopped at all costs lest the USA degenerate into a communist backwater like Sweden.

Makes perfect sense!

Show the small waste to mask the Trillions (3, Informative)

elkto (558121) | more than 5 years ago | (#27814407)

Er, you mean force workers into Unions to control them using a open ballot system. Hmmmm, billions since 1969 vs trillions in his first 100 days. Defense vs. Wealth redistribution.... Hmmm.....
Me thinks people should be skeptical of your type...

Re:Show the small waste to mask the Trillions (1, Troll)

Bill_the_Engineer (772575) | more than 5 years ago | (#27815049)

Obama can't take full credit for all the trillions being spent. Bush approved the vast majority of the first trillion without any strings attached because the financial system was too big to fail.

Too bad Obama had to inherit the problems created under the 8 years of Bush.

I loathe party politics and the left versus right BS, but come on just look at the facts.

I guess the only thing the remaining republicans can do is just stir up crap in hopes that maybe they can trick people into thinking their way is better.

What we really need is more than two parties...

Re:Show the small waste to mask the Trillions (3, Funny)

gerglion (1264634) | more than 5 years ago | (#27815131)

Larry, Moe, and Curly?

Re:Show the small waste to mask the Trillions (1)

elkto (558121) | more than 5 years ago | (#27815343)

Er.... Clinton/Pelosian Economy maybe.... The only thing Bush did wrong is not pursuing/attacking the Clinton banking/lending nightmare with the same gusto he had for the Iraq conflict. The lending nightmare that Barney Frank's said did not exist and the good Senator from Illinois vowed to defend.
For loathing party politics, you spew it well!
Obama inherited the nightmare he helped bring to into existence.
We can agree, both parties need to go, this time you guys first. I am not going to help bring another Clinton nightmare back.

Re:Socialism!!!!eleventy-one11! (1, Informative)

Anonymous Coward | more than 5 years ago | (#27814641)

using extreme examples is a way of avoiding the real problem. you're as much part of the fud as the contractors who champion the broken systems.

Re:Socialism!!!!eleventy-one11! (2, Insightful)

Sausage Nibblets (1469103) | more than 5 years ago | (#27814843)

It's funny, because you're making fun of people for not understanding socialism while you yourself don't understand capitalism.

Re:Socialism!!!!eleventy-one11! (1)

brian0918 (638904) | more than 5 years ago | (#27815165)

Perfect response.

Re:Socialism!!!!eleventy-one11! (0, Troll)

homer_s (799572) | more than 5 years ago | (#27814969)

Explicitly allowing military contractors to overcharge the taxpayer to deliver broken systems on no-bid contracts is the heart of True Capitalism(tm) and A-OK.

Where did you get that idea?
Oh, you're making sh1t up. Ok, let me try - socialism means killing little babies and feeding them to dogs.

Ironic, really... (5, Insightful)

fuzzyfuzzyfungus (1223518) | more than 5 years ago | (#27814279)

In all likelihood, it will be our own military contractors, too politically powerful to reign in, who will eventually destroy our military effectiveness. We can spend as much as we like(and we already do) but, so long as our spending is a mixture of "what Raytheon feels like producing" and "the ultimate weapon against the forces of the evil empire rolling across Europe in alternate-1979" it won't do nearly as much good as we would like.

I wonder if this is how the Romans felt?

Re:Ironic, really... (1)

Octorian (14086) | more than 5 years ago | (#27814463)

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!

Re:Ironic, really... (5, Interesting)

bertok (226922) | more than 5 years ago | (#27814533)

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.

It's not as complicated as it seems... (2, Funny)

mangu (126918) | more than 5 years ago | (#27814833)

To better understand it, you should read the explanations in the backside of the chart [dau.mil] . Awesome!

Re:Ironic, really... (0)

Anonymous Coward | more than 5 years ago | (#27814595)

Um....

'Production & Deployment Phase' column.

About half-way down...

'Low-Rate Initial Production Systems' leads to 'Final Production Baseline' leads to 'Full-Rate Production Systems'.

I guess you've never seen a Life Cycle Management Framework before. How else would you deal with an item that takes years to design before production and could be in use for decades? It requires a HUGE amount of paperwork to track decisions and resources.

Re:Ironic, really... (1)

elrous0 (869638) | more than 5 years ago | (#27814683)

Haven't you heard? The latest and greatest contractor fad is non-lethal weapons. The results of the $400 million pumped in so far are, of course, wildly successful [foxnews.com] .

Re:Ironic, really... (1)

HomeLights (1097581) | more than 5 years ago | (#27815215)

Bean bags and frisbees are the wave of the future...welcome to the 1960's Peace and Love...

Re:Ironic, really... (2)

internerdj (1319281) | more than 5 years ago | (#27815079)

If you work anywhere near the military it isn't near here... I don't know how many stories I've heard where contractors were forced to use FCS to fast-track equipment to the soldiers in Iraq because the standard military procurement process would have had the equipment to the soldiers in Iraq after we finish the conflict in Afghanistan. Of course, the press runs that as wasteful spending of the FCS money.

Military Contracts!!! (5, Insightful)

copiedright (1357445) | more than 5 years ago | (#27814321)

This issue could be considered more of a scapegoat for the horrendous spending and poor budget management of the many poorly managed defense contracts over the last 40 years. Trust me, 10 Billion pales in comparison to what has been directly wasted. Also, 10 Billion dollars may seem a lot, but given its based around 40 years it cuts it down quite a bit.

Re:Military Contracts!!! (0)

Anonymous Coward | more than 5 years ago | (#27814663)

You're shrugging this off but it could have been prevented extremely easily and everyone who could have authorised the change didn't because of attitudes like yourself, that makes it a big deal.

Re:Military Contracts!!! (0)

Anonymous Coward | more than 5 years ago | (#27814887)

This issue could be considered more of a scapegoat for the horrendous spending and poor budget management of the many poorly managed defense contracts over the last 40 years.

Trust me, you don't know what the hell you're talking about. As an engineer who has worked in defense for the last decade, I figure that for about every hour of doing technical work there are seven to ten hours (depending on the contract) expended on management. This is a result of the public's continued cry for more oversight. We have to document and communicate everything we do, lest some auditor find a way to ding us. This amount of useless but necessary overhead frustrates and runs off the more technically talented, that then have to be replaced by less capable engineers who have to bill more hours to get the job done. You want more management? Be prepared to pay for it.

Show me a government agency (1)

Shivetya (243324) | more than 5 years ago | (#27815003)

that is properly run?

When your accountability will not result in demotion, being fired, or such, what do they expect?

This Pentagon example is yet another reason why everyone should be running and screaming away from the current Administration and Congress goal of even larger Federal Government.

Why not harp more on the Congressional mandated waste in the Pentagon? Like how bases are kept open and programs going just to keep votes rolling in? I am quite sure it amounts to more than a decimal error

Re:Military Contracts!!! (0)

Anonymous Coward | more than 5 years ago | (#27815127)

Why not use the same formulae for simplying taxing the Contractors Corporations.

A few billions overpaid here a few billions over paid tax there it would balance out eventually.

Money wasn't lost (1, Insightful)

jellomizer (103300) | more than 5 years ago | (#27814329)

Money Circulates it doesn't get lost.
Say you get $10.00
You save $1.00 and Spend $9.00
That guy who got that $9.00 saves $1.00 and spend $8.00
That guy who got that $8.00 saves $1.00 and spend $7.00
That guy who got that $7.00 saves $1.00 and spend $6.00
That guy who got that $6.00 saves $1.00 and spend $5.00
That guy who got that $5.00 saves $1.00 and spend $4.00
That guy who got that $4.00 saves $1.00 and spend $3.00
That guy who got that $2.00 saves $1.00 and spend $1.00
That guy who got that $2.00 saves $1.00

So overall $10.00 was saved and $45.00 worth of goods and services were paid for and at some point the money that is saved will be spent too and repeating the cycle.

Those extra pennies have probably circulated so much that they went back into taxes and funded themselves.

Re:Money wasn't lost (1)

tpgp (48001) | more than 5 years ago | (#27814393)

I take it you walk round throwing away $50 notes - after all, money doesn't get lost!

Those extra pennies have probably circulated so much that they went back into taxes and funded themselves.

Sincere but incorrect economics lecture or
  subtle troll? Frankly - I have no idea.

Re:Money wasn't lost (1)

jellomizer (103300) | more than 5 years ago | (#27814655)

You analogy misses a point. By Throwing away the $50.00 notes I am not getting any goods/services from it, so there is no value in doing such an activity. Also unlike a government my money isn't directly funded by taxes so the more money moving around doesn't effect how much I personally get paid. But for the Pentagon does, So the more money moves the more they get back. Governments work more on Macro-Echonomics individuals work in Micro-echnomics.

Re:Money wasn't lost (0)

Anonymous Coward | more than 5 years ago | (#27815357)

You had me until "echonomics".

Re:Money wasn't lost (3, Insightful)

MrMr (219533) | more than 5 years ago | (#27814475)

You're the guy that thought up both the credit swaps and the bailout for Wallstreet right?
Without specifying your 'goods and services paid' your 45$ is worth exactly 1$ + Vapour.

Re:Money wasn't lost (2)

Late Adopter (1492849) | more than 5 years ago | (#27814659)

You laugh (derisively), but GP more or less describes "leverage", the excesses of which ended up necessitating the bailout.

There's nothing particularly wrong with creating credit through leverage (more credit creates more growth opportunities), as long as your risks can be managed properly. And if we're a society that's unwilling to tolerate capital-d Depressions now and then along with our growth, we have to accept a tight level of preventative regulation in our financial sector. Finance and government will always have a more intimate relationship than most private industries.

Re:Money wasn't lost (1)

MrMr (219533) | more than 5 years ago | (#27814879)

Well, I snigger derisively at 'leverage'.
The silent assumption always seems to be that risks are magically 'managed away' by obscuring the cumulative exposure in the credit chain.

Re:Money wasn't lost (3, Informative)

mangu (126918) | more than 5 years ago | (#27814563)

You should study something about economics. Start here [wikipedia.org] .

Liberal lies!!!11!! (2, Funny)

0xdeadbeef (28836) | more than 5 years ago | (#27814665)

None of that money was backed by gold, so it actually never existed!

Story is nothing (0)

Anonymous Coward | more than 5 years ago | (#27814335)

If the contractors knew they'd get "overpaid" a few pennies per person, that would be figured into their rates.

1/3 of 1 percent = $0.02? (0)

scipero (103758) | more than 5 years ago | (#27814351)

That's below minimum wage. Someone needs to find a new employer.

Or a new calculator.

Re:1/3 of 1 percent = $0.02? (1)

CyberK (1191465) | more than 5 years ago | (#27814465)

However, in 1969 the minimum wage was $1.60, so six bucks an hour was quite alright.

Re:1/3 of 1 percent = $0.02? (0)

Anonymous Coward | more than 5 years ago | (#27815441)

Someone needs to read the fucking blurb. Really, the average IQ around here has been dropping sharply lately.

Who Cares? (1)

afidel (530433) | more than 5 years ago | (#27814359)

Of all the expenditures the government wastes money on the one I care least about is paying those who actually defend our country. Not only that but it's one of the few powers explicitly granted to the federal government and one of the few that needs to be federalized.

Re:Who Cares? (1)

fuzzyfuzzyfungus (1223518) | more than 5 years ago | (#27814667)

While, as you say, defense expenditures are on a sound constitutional footing, that doesn't absolve them from the need to be effective.

Of particular note, given your formulation "paying those who actually defend our country" is the fact that the defense budget, while gigantic, is hardly infinite. If, because of political pressure or poor oversight, more money is going to contractors, less is going to "those who actually defend our country". Further, if oversight is poor, the quality of equipment they are going to have to use will likely be poorer.

Defense spending, as a government activity, is well founded; but corruption and mismanagement reduces actual defense spending to the private benefit of a few special interests.

The two cents extra.. (0, Offtopic)

jDeepbeep (913892) | more than 5 years ago | (#27814379)

... was compensation for the time he spent participating on /. while at work.

People misunderstand the purpose of spending (1)

Colin Smith (2679) | more than 5 years ago | (#27814389)

Contrary to popular belief, the main purpose of most government spending is simply to create new money. This allows subsequent credit expansion and "growth".

The whole concept of value for money or saving taxes is completely wrong in this regard and simply doesn't fit with our monetary system. Which might help explain why nobody is keen to do anything about over spends.

Re:People misunderstand the purpose of spending (4, Insightful)

omeomi (675045) | more than 5 years ago | (#27814523)

Contrary to popular belief, the main purpose of most government spending is simply to create new money. This allows subsequent credit expansion and "growth".

That theory starts to break down when the money your government is spending actually belongs to China...

Re:People misunderstand the purpose of spending (1)

twostix (1277166) | more than 5 years ago | (#27815449)

Breaks down even worse when China starts getting rather cranky about that overspending and "growth" devaluing their colony(ahem)..investment.

Re:People misunderstand the purpose of spending (0)

Anonymous Coward | more than 5 years ago | (#27814675)

You have no idea about actual economics. Money is not a product in it self. Money is a substitute for products. If I make a two hundred dollars and buy an x-box would that be good for the economy??? Why is it good that the government do the same? Well, it is no different and it is not good for the economy. What is happening is money is entering the system that has no return value. No body can eat or sleep better at night because of my two hundred dollars more then me. While the effect of two hundred dollars would be close to 0 in our financial system the effect of 1,000,000,000,000* will be noticeable in inflation which is a lose of value of people previous work. While I think that there should be inflation because the value of work decays with time. Having grown fruits ten years ago is less valuable then having grown them yesterday. Now borrowing is simply the promise of future production.

If anyone disagrees tell them to draw on paper on how it would work when it actually comes down to that only so many apples will be grown and sold a year and if there is more money without more apples then people will simply have to pay more to buy the same apples. If this is the case then no value was created.

What about deflation? People simply have less money and so they can't buy as many apples. But there is still the same amount of apples being made so the price has to come down.

If you apply what you see here to complex markets and account for that all of the changes I am talking about take time to actually reach down to the apples level you will realize that a lot of money can be made. Without exchanging it for goodies. Also If you ever hear someone one TV or in a newspaper say that some new punks are the Smartest Guys on the Street, it's time to start shorting their stock.

* The Federal Reserve Which is not even really part of the government has printed this much extra.

I know who to blame! (1, Redundant)

Prototerm (762512) | more than 5 years ago | (#27814401)

It's all Richard Pryor's fault!

(cf: Superman 3)

What may be the real problem (1)

zoomshorts (137587) | more than 5 years ago | (#27814469)

Is that EVERY Federal employee, contractors and all, use the same
accounting package. Maybe under different names, but I would
wager it is a common place accounting package which is entrenched
in the 'system'.

King of the Capitol Hill (5, Funny)

RevWaldo (1186281) | more than 5 years ago | (#27814553)

This sounds like a "King of the Hill" episode, writ large.

"No, Peggy, you don't understand! They're OVERPAYING ME! I'm stealing from the government, I tell you what! And I can't get them to stop! It keeps me up at night, I tell you what!"

Forty years later: A Colonel shows up at Hank's door.

- "Mr Hill? We've responded to your letter, and it turns out you were right. We have been overpaying you all this time."
- (sighs.) "I always knew this day would come." (hold out his wrists) "I'll come along quietly."
- "No, no, Mr. Hill! You don't understand. We're implementing the fix you suggested. It'll save the government millions of dollars a year. We just wanted to thank you!"
- "Oh. Huh. Well, thank you sir. But in that case, can I at least give you back the money?"
- "I beg your pardon?"
- "Wait here." (Hank goes to his garage, wheels out a 50-gal drum on a hand truck.) "I've been putting the extra pennies in here since 1969, I tell you what. And now I'm ready to return it."
- (smiles) "No, you go ahead and keep that. We're cool." (leaves)
- "Alright! I can go to college now!"
- "Bobby, go to your room!"
- "I'm 45 years old! You can't make me go to my room!"
- "Now, mister!"
- "Aw.."

I'm not quite sure I understand. (3, Informative)

sunking2 (521698) | more than 5 years ago | (#27814627)

This guy doesn't work directly for the government. I'll assume its cost plus work that he's doing, so Rockwell charges his hours directly back to the government. However, they don't charge his hourly rate, they charge Rockwells hourly rate for his job position, which is more than his personal calculated take home (or Rockwell would be making no money on his work). So the real losers here would seemingly be Rockwell as they have to pay him out of their pool of money and the $0.02/hr would come out of their profits.

Employees don't have individual rates. It typically goes by job title/position, ie: assoc engineer time is worth $120/hr, senior is worth $200/hr (purely made up numbers, not sure on the actual rate or title names), etc.

If its not cost plus then this is even more confusing as Rockwell is working to a contract dollar value and any extra pay again would come out of their profits. The accounting doesn't make a whole lot of sense to me. Unless this is some special case in which the numbers of people it would affect would seem pretty small.

Re:I'm not quite sure I understand. (1)

rnelsonee (98732) | more than 5 years ago | (#27815125)

The second page of the article talks about the 'bug' - Rockwell figures salaries based on 2080 hours/yr. while the Federal gov't uses 2087. I see how your point can be valid, but it's possible that Rockwell gets a price on the contract, say $50M; but then instead of getting a $50M check, the gov't just uses that to set up the payroll figures. But by having different hours/yr, Rockwell, too, gets more than $50M over the life of the project. With multi-year projects, and the fact that they almost never get finished on budget, maybe the gov't paying out an extra $165,000 on a $50M budget just doesn't get noticed.

Re:I'm not quite sure I understand. (1)

sunking2 (521698) | more than 5 years ago | (#27815465)

I dunno. Still doesn't seem to make much sense as work is charged back by the hour, not by the year. Actually by the 6 minute. Nobody charges full time back to the government so the hour/yr makes no sense. The accounting rules are very specific as to what you can charge back and what you can't. For example, your weekly staff meetings go to overhead charge numbers, not back to the customer/government. Now I'm talking today, not 30 years ago which is when this apparently is from. A lot has changed since then I'm sure.

Most fantastic pile o' loot on the planet (2, Interesting)

ericferris (1087061) | more than 5 years ago | (#27814743)

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.

Why did the lobby oppose him? (0)

Anonymous Coward | more than 5 years ago | (#27814779)

I get the impression that the lobby didn't want the payment error fixed. What interest would they have in Pentagon leaking money to its employees? Or did it leak to others as well?

Not a solution (1)

sheepofblue (1106227) | more than 5 years ago | (#27814849)

Sometimes the tracking and cost to correct the issue are more than the actual 'waste'. In pretty much every area of government there is out right fraud, THAT is where the focus should be. Or how many billions have been given out by Congress to buy votes from us with our own money? This guy is a loon.

Gotta blame the pols too (2, Insightful)

tatman (1076111) | more than 5 years ago | (#27814889)

We blame the lobbists for their stance, and rightly so. We also have to blame the politicians, congress etc...if they actually stood for what is right and is common sense the lobbyists view wouldn't matter. But the politician is only about power for himself and getting re-elected. Since the lobbyist serves his personal agenda well, the lobbyist get a lot power from it simply by the politicians selfish motivations. So the politicians are equally to blame. They don't care about 100 million dollars that is taken from your paychecks.

Convert pennies into executive bonuses! (1)

bluie- (1172769) | more than 5 years ago | (#27815075)

I'm incredibly surprised the execs didn't decide to quietly fix the problem and pocket the money for themselves.

Oh, Ike! (1)

bill98122 (1547183) | more than 5 years ago | (#27815085)

Oh, Ike, if only we had listened to you: "In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the militaryindustrial complex. The potential for the disastrous rise of misplaced power exists and will persist." Full text of his 1961 speech here: http://coursesa.matrix.msu.edu/~hst306/documents/indust.html [msu.edu]
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