Government Budget Games

Politicians ought to provide taxpayers a full accounting of government finances at all times. But they don't.

Politicians have better ways to spend their time than to make it easy for you to see what they're doing. They can hand out more pork, appropriate bigger budgets and enact more Big Government programs - when no one's looking closely over their shoulders.

So politicians try to convince you that your tax dollars are in good hands - their hands. They want you to believe that you needn't trouble yourself with the details.

They employ a battery of techniques to keep you placated, confused, and misinformed about government spending.

There's about as much "sunshine" on government finance as you'd expect to find in a deep, dark cave.

Senior reporters and editors for major media newspapers are fully aware of how hard it is to get meaningful financial data about government operations. Yet they refuse to blow the whistle. They are accomplices in a massive, unparalleled financial cover-up used to deceive American taxpayers.

Here's a few of the budget games politicians play to cover-up what they're doing with your tax dollars:

Outright refusal to publish government budgets or to make them readily available to ordinary citizens is common. You are often forced to jump through hoops to get your hands on a copy of a government budget. Even government employees sometimes have difficulty getting one.

Lack of relevant information makes most government budgets useless. Ones that give enough detail to paint a clear picture of how well or poorly money is being spent are extremely rare - and often available only to the most powerful political leaders and their insider friends

Non-standard accounting practices are a joke. Rather than using common accounting practices that are well understood and proven effective for commercial enterprises, politicians have established special accounting standards for government that result in almost no accountability at all. For example, Massachusetts government agencies are required to adhere to the "Government Accounting Standard", ostensibly to ensure that dollars in and out of the government's coffers are accounted for. But a serious study of the state's finances makes clear that these standards are all but useless. It should be noted that the accounting firms hired by the government, such as Deloitte & Touche in Massachusetts, are major donors to political campaigns.

Scattering and camouflaging spending among multiple departments and accounts for a given government function is common, making it difficult if not impossible to determine the performance of a particular political initiative or bill that was passed. One notorious example is accounts that combine all government employee benefits. By lumping this cost of employees into one account, it is difficult if not impossible to assess the true cost of individual functions such as public schools.

Multiple, unreconciled versions of the budget are often published for a given government agency, e.g., the statutory budget, supplemental budgets, the U.S. Census audit of state budgets, and the CAFR (Comprehensive Annual Financial Reports). Glaring discrepancies between budgets are common - but people who can and will explain them to you are notably uncommon.

Archaic formats are typical of government budgets. Many budgets are available to the public only in hardcopy form, or when available in electronic form, they're in a word processor format rather than a spread sheet, making it very difficult and time-consuming to do a meaningful analysis.

"Rainy day" and other reserve funds obscure and protect spending levels. If the economy is in recession and incomes go down, politicians use them to avoid cutting spending. Politicians are rarely forced to tighten their belts as taxpayers must do when jobs dry up, salaries freeze, or private sector pay scales go down. Reserve funds enable them to delay tax hikes to fund their ever-expanding budgets until they are more poltically feasible.

Off-the-books accounting, referred to as "off-budget accounting" makes up a huge portion of government spending, perhaps as high as 40%. This vast some is even more protected from public scrutiny since it is rarely reported at all.

As one example, the Massachusetts FY2005 statutory budget was approximately $22.5 billion, but the CAFR (Comprehensive Fiscal Accourting Report) shows that actual spending was over $40 billion. Massachusetts politicians spent DOUBLE what they report in the "official" budget. Published budgets do not even begin to explain where this money goes. Where's the media to expose these vast sums of hidden money?

Astute citizen watchdogs noticed in 2004 that about $2 billion dollars in new spending in Governor Mitt Romney's proposed FY2005 budget was unaccounted for. After some digging, it was discovered that the legislature had voted to move "off budget" (the Mafia calls this "off the books") another $2.2 billion in funds that had been previously accounted for in the statutory budget. When this was pointed out to the Boston Globe's lead state budget reporter, he clarified this in a few subsequent articles about the budget - then dropped the issue. It hasn't been reported in the pages of the Boston Globe since. Nor do they expose the $20 billion discrepancy between in the latest CAFR report (now over $45 billion) and today's statutory budget (almost $26 billion for CY2007).

Hello?!?!? You call that budget reporting? We call it a cover-up.

Intergovernmental money transfers, i.e., subsidies from one government to another, make government budgets even more confusing and hard to understand and makes it near impossible to hold the politicians who voted for the spending accountable. This is a widespread practice accounting for a large portion of state and local budgets. Often more than one-third of a state budget is funded with federal subsidies.

Separate capital budgets get politicians off the hook from showing the true cost of government. For example real estate, which businesses have to show as a depreciation expense, show up as no expense in most analyses of a particular government function. If they are funded by bonds, they're usually accounted for in separate budgets.


Many of these accounting practices, if done in the private sector, would land the politicians and bureaucrats who ordered them in jail.

As a taxpayer and citizen of the United States, you deserve a full and accurate accounting of how your hard-earned dollars are spent. Therefore it is imperative that we demand an end to the financial crimes of Big Government.

These confusing budget shell games make it near impossible for you to know what the government is doing with your money.

To add to your confusion, politicians not only play games with government budgets. They also develop ways to talk about budgets that are deceptive. Here's some of the techniques they use specific to budgets from our BIGGIBS Glossary: