Treasury Employees Estimate Fraud in Entitlement Payments at $50 Billion Annually
Last week was a rough week for the Democrats. Already reeling from the deluge of President Donald Trump’s executive orders that reversed every far-left policy implemented by his predecessor, they were rocked by reports that Elon Musk’s Department of Government Efficiency (DOGE) had revealed the United States Agency for International Development (USAID) to be little more than a global slush fund for progressive causes.
For Democrats, the tipping point came when they discovered that Musk’s team had set its sights on the Treasury Department.
Likely well aware of what was about to be exposed, the party pulled out all the stops to halt the process — including enlisting a highly partisan New York district court judge to issue an emergency order on Friday night to block DOGE’s access to the Treasury payment system. Professor William Jacobson provided his analysis of the ruling here.
This was a tactic of desperation. It was designed to slow Musk down. While none of us can predict the outcome of this case and the others that are sure to follow, I would be pretty surprised if Musk were stopped for good.
Musk is confident that he and his team of tech wizards will find fraud and waste inside the Treasury Department. In fact, in a Saturday post on X, he wrote:
Yesterday, I was told that there are currently over $100B/year of entitlements payments to individuals with no SSN or even a temporary ID number. If accurate, this is extremely suspicious.When I asked if anyone at Treasury had a rough guess for what percentage of that number is unequivocal and obvious fraud, the consensus in the room was about half, so $50B/year or $1B/week!! This is utterly insane and must be addressed immediately.
This raises two immediate questions: Why would any employee disburse funds without proper documentation? And why, if roughly half of the staffers present believed that at least $50 billion a year was “unequivocal and obvious fraud,” did no one try to stop it?
That was the first question Musk was asked. He replied, “Nobody in Treasury management cared enough before. I do want to credit the working-level people in the Treasury who have wanted to do this for many years but have been stopped by prior management.
“Everything at Treasury was geared towards complaint minimization. People we receive money don’t complain, but people who don’t receive money (especially fraudsters) complain very loudly, so the fraud was allowed to continue.”
In his original post, Musk reported that DOGE and Treasury have agreed on several “super obvious” changes going forward.
– Require that all outgoing government payments have a payment categorization code, which is necessary in order to pass financial audits. This is frequently left blank, making audits almost impossible. – All payments must also include a rationale for the payment in the comment field, which is currently left blank. Importantly, we are not yet applying ANY judgment to this rationale, but simply requiring that SOME attempt be made to explain the payment more than NOTHING! – The DO-NOT-PAY list of entities known to be fraudulent or people who are dead or are probable fronts for terrorist organizations or do not match Congressional appropriations must actually be implemented and not ignored. Also, it can currently take up to a year to get on this list, which is far too long. This list should be updated at least weekly, if not daily.
Lest anyone accuse him of overstepping his boundaries, Musk noted that these changes “are being implemented by existing, long-time career government employees, not anyone from @DOGE.”
I’m not quite sure if the Democrats are aware that the majority of Americans fully support an audit of the government. After all, who wouldn’t want to know where their tax dollars are going?
Last week, Musk conducted a poll of his own on X. He asked his 216 million followers if DOGE should audit the IRS. Of the nearly 1.9 million people who responded to the poll, 51% said yes; another 41% replied “F Yes,” and just 8% said no.
Elizabeth writes commentary for The Washington Examiner. She is an academy fellow at The Heritage Foundation and a member of the Editorial Board at The Sixteenth Council, a London think tank. Please follow Elizabeth on X or LinkedIn.
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