Throwback Thursday: Commerce Program Wasted $4M
In 1986, the Department of Commerce’s Economic Development Administration wasted $4 million – worth $11 million in 2023 dollars – on a failing program whose own auditors said “deserved to die” for being ineffective.
Sen. William Proxmire, a Democrat from Wisconsin, awarded the agency his Golden Fleece Award for this wasteful and ineffective program.
According to Proxmire, the agency’s university center program was established at colleges across America to create jobs and help local businesses find talent. Unfortunately, it wasn’t very effective. Administration officials claimed the top ten university centers created 5,834 jobs, but the Commerce Department’s Inspector General found the actual number was 83.
The program inflated its numbers through a series of schemes and technicalities. For example, a university claimed to have created 25 jobs, but the entire business that employed them filed for bankruptcy before the university’s report was prepared. In another instance, a center claimed a thousand jobs were created when it later admitted to auditors the actual number was 35.
The Inspector General said in a report that, “In many cases, ‘[jobs] saved or created’ … literally never existed.” The Inspector General also found that this program was duplicative, stating it was very similar to other federal programs in the types of services it provided.
Bureaucrats from the program defended it, claiming that their overinflated numbers were accurate, and that they represented potential jobs created instead of actual ones.
This program’s ineffectiveness and duplicity, along with its dishonest reporting, were grounds to shut this program down within a few years, but it unfortunately, it continues to exist to this day.
The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com
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