Hawkeye Reporter

WASHINGTON – Sens. Chuck Grassley (R-Iowa) and Bernie Sanders (I-Vt.), along with Sens. Ron Wyden (D-Ore.), Rand Paul (R-Ky.) and Ed Markey (D-Mass.), introduced a bipartisan bill to require the Department of Defense (DOD) to pass a full, independent audit in fiscal year 2024. The Audit the Pentagon Act of 2023 would further direct any DOD component that fails to complete a clean audit to return one percent of its budget to the Treasury.    

The DOD – which consumes more than half of the nation’s discretionary budget and controls more than $3.1 trillion in assets – is the only federal agency that has been unable to pass an independent audit, despite the fact all federal agencies have been required by law to conduct annual audits since 1990.

“From buying $14,000 toilet seats to losing track of warehouses full of spare parts, the Department of Defense has been plagued by wasteful spending for decades. Every dollar the Pentagon squanders is a dollar not used to support service members, bolster national security or strengthen military readiness,” Grassley said. “The Department of Defense should have to meet the same annual auditing standards as every other agency.” 

“The Pentagon and the military industrial complex have been plagued by a massive amount of waste, fraud, and financial mismanagement for decades. That is absolutely unacceptable,” Sanders said. “If we are serious about spending taxpayer dollars wisely and effectively, we have got to end the absurdity of the Pentagon being the only agency in the federal government that has never passed an independent audit.”  

“Taxpayers can’t keep writing blank checks— they deserve long-overdue transparency from the Pentagon about wasteful defense spending,” Wyden said. “If the Department of Defense cannot conduct a clean audit, as required by law, Congress should impose tough financial consequences to hold the Pentagon accountable for mismanaging taxpayer money.” 

“Accountability and transparency are the bedrock of responsible democracy. No institution is above scrutiny, especially the Department of Defense which has the largest budget of any federal agency and is charged with carrying out the greatest constitutional responsibility. We need to ensure that our defense spending is accurate, accountable, and in the best interest of American Taxpayers,” Paul said. 

“Defense contractors are lining their pockets with taxpayer money while the Pentagon fails time and time again to pass an independent audit. It’s a broken system,” Markey said. “We need to compel the Department of Defense to take fraud and mismanagement seriously—and we need Congress to stop inflating our nation’s near-trillion-dollar defense budget. Putting the wants of contractors over the needs of our communities isn’t going to make our country any safer.” 

 A troubling financial past:

The 2022 Navy audit found $4.4 billion in previously untracked inventory, while the Air Force identified $5.2 billion worth of variances in its general ledger. Reports indicate contractors have routinely overcharged the Pentagon – and the American taxpayer – by nearly 40-50 percent, and sometimes as high as 4,451 percent. The Commission on Wartime Contracting in Iraq and Afghanistan concluded $31-60 billion spent in Iraq and Afghanistan was lost to fraud and waste. And, a recent Ernst & Young audit of the Defense Logistics Agency found it could not properly account for some $800 million in construction projects.  

Unreliable financial oversight and inadequate internal controls at the agency have landed it on GAO’s high-risk list for financial management for nearly 30 years. Yet, the Pentagon has not demonstrated appropriate urgency in addressing the problems. Earlier this year, the GAO issued a report commissioned by Grassley, Sanders and Wyden which confirmed DOD accounting systems can neither generate reliable and complete information, nor capture or post transactions to the correct accounts. This is a violation of statutory requirements and contributes to the agency’s audit failures.  

On September 10, 2001, former Secretary of Defense Donald Rumsfeld said, “Our financial systems are decades old. According to some estimates, we cannot track $2.3 trillion in transactions. We cannot share information from floor to floor in this building because it's stored on dozens of technological systems that are inaccessible or incompatible.” More than two decades later, the DOD still cannot account for trillions of dollars in transactions. With the Audit the Pentagon Act of 2023, the lawmakers are looking to prompt a change of course.

The legislation is cosponsored by Sens. Mike Lee (R-Utah), Elizabeth Warren (D-Mass.), Mike Braun (R-Ind.), Jeff Merkley (D-Ore.) and Tammy Baldwin (D-Wis.).  

Original source can be found here.