Study cites 46 abuses; 'Wasted' dollars at Pentagon: How much will Reagan save?
Admirals and generals are striding Pentagon corridors these days with a new spring in their step. But their elation at the prospect of billions of dollars' worth of additional defense expenditures may be tempered somewhat as they are required to ferret out waste in the nation's sprawling defense establishment. According to a congressional report, US armed forces squander billions of dollars yearly.
The Reagan administration plans to ask Congress to boost the Pentagon's budget for this fiscal year and the next by $31 billion. About $6 billion extra will be sought this year and another $25 billion will be asked for fiscal 1982.
Former President Carter had submitted a $194.6 billion defense budget to Congress for the latter fiscal year, the largest such request in peacetime history.
But with the additional billions comes President Reagan's injunction to Defense Secretary Caspar W. Weinberger to "Search out" waste and extravagance at the Pentagon. He might well have added fraud and abuse to the list.
The Congressional Republican Study Committee has estimated that the Pentagon could save $15 billion yearly if it put its house in order. A House Appropriations Committee report on the defense appropriation bill for 1981 lists 46 ways in which the armed services fritter away taxpayers' dollars -- to the tune of tens of billions yearly.
According to the little-publicized report, failure to levy "proper and complete" charges on countries receiving military equipment under the Foreign Military Sales Program -- notably for training and transportation -- is a habit that incurs considerable losses. Indeed, the General Accounting Office (GAO) estimates that the Defense Department is more than a billion dollars out of pocket as a result.
Losses are also incurred, adds the report, by failure to return to depots millions of dollars' worth of equipment that needs repair, a practice that results in simultaneous disposal and procurement of costly items.
Poor record-keeping and accounting practices have permitted the theft of millions of gallons of fuel, it adds.
Altogether, the report asserts that billions of dollars are wasted by such practices as:
* Repeatedly paying "outrageous prices" for small, simple-to-manufacture items.
* Paying maintenance contractors for work never performed.
* Storing clothing at supply depots thousands of miles from training bases where it is issued.
* Failing to reduce the theft and "misappropriation" of supplies and materials.
* Operating duplicate facilities for the overhaul of air-launched missiles and failing to consolidate various training and education activities.
Scrutiny of the published hearings of the House Appropriations Defense Subcommittee discloses additional, dramatic wastage in the armed forces.
Last year, for instance, an inspection of the Naval Supply Center in Oakland, Calif., revealed that 240 propellers, propulsion shafts, and other components valued at $8 million were rusting in the open air for lack of warehouse space.
The subcommittee also discovered that in fiscal year 1978 the Defense Logistics Agency lost $6 million worth of goods, much of it from the Defense General Supply Center in Richmond, Va. It declared that warehouses at the depot were "literally stuffed with pilferable and nice-to-have items." Security at the center has since been tightened up.
According to the committee's investigative staff, the Navy's research and development effort wastes "millions of dollars" each year by leasing computers an average of 48 months "beyond the period at which purchase would have been the best decision."
Moreover, the committee cites defense auditors for the assertion that the Department of Defense employs 17 obsolete computer systems costing $1.8 million annually to operate when more modern equipment exists that could do the work.
The Navy often seems to suffer from greater abuse than its sister services. Its clothing and tools are regularly pilfered by personnel and last year it was alleged that its exchange system (on-base stores) had lost more than $100 million through kickbacks, mismanagement, and cover-ups.
Navy shipbuilding practices do not seem to be dictated by economy, either Rep. Norman D. Dicks (D) of Washington claims yards could build warships a lot more cheaply "if there wasn't all the Navy bureaucracy superimposed upon them with its apparent inability to make up their minds on the design of ships." He is also critical of the "tremendous" number of costly changes the Navy makes once a ship is under construction.