pluralistic.net
Pluralistic: It's pretty easy to cut $2 trillion from the federal budget, actually (27 Jan 2025)
Today's links It's pretty easy to cut $2 trillion from the federal budget, actually: Just end all the private-sector profiteering. Hey look at this: Delights to delectate. Object permanence: 2005, 2010, 2015, 2020, 2024 Upcoming appearances: Where to find me. Recent appearances: Where I've been. Latest books: You keep readin' em, I'll keep writin' 'em. Upcoming books: Like I said, I'll keep writin' 'em. Colophon: All the rest. It's pretty easy to cut $2 trillion from the federal budget, actually (permalink) If Elon Musk wants to cut $2t from the US federal budget, there's a pretty straightforward way to get there – just eliminate all the beltway bandits who overcharge Uncle Sucker for everything from pharmaceuticals to roadworks to (of course) rockets, and then make the rich pay their taxes. There is a ton of federal bloat, but it's not coming from useless programs or overpaid federal employees. As David Dayen writes in a long, fact-filled feature in The American Prospect, the bloat comes from the private sector's greedy suckling at the government teat: https://prospect.org/economy/2025-01-27-we-found-the-2-trillion-elon-musk-doge/ The federal workforce used to be huge. In 1960, federal employees were 4.3% of all US workers; today, it's 1.4%. Zeroing out the entire federal payroll would save $271b/year (while beaching the US economy!), a mere 4% of the federal budget. On the other hand, zeroing out the budget for federal contractors would save over a trillion dollars – the US spends 4 times more on private sector contractors than it does on its own workers, and while some of those contractors are honest folks giving good value for money, the norm is for federal contractors to pick the public's pocket and then use the proceeds to lobby for more fat contracts. One key job we ask our federal employees to do is root out private sector fraud in federal contracting. We should hire more of these people! Private contractors steal $274b/year from the public purse – nearly enough to pay for all the employees in the federal government: https://www.gao.gov/assets/gao-23-106285.pdf Musk doesn't know any of these, and he doesn't care to know. As Dayen writes, he's doing "policy by anecdote." Take Ashley Thomas, the director of climate diversification for the US International Development Finance Corporation. Musk sicced a mob on her, decrying her for doing a "fake job" that was somehow related to "DEI." But Thomas's job isn't employment diversification – it's crop diversification. If Musk wanted to run DOGE as a force for waste-elimination, he wouldn't be attacking the Corporation for Public Broadcasting and PBS (whose budget accounts for 0.012% of federal spending). He wouldn't be attacking federal fiber subsidies (he's mad that he can't get more subsidies for his dead-end satellite service that caps out at one ten-millionth of the speed of fiber). He wouldn't be attacking high-speed rail (which competes with his Tesla swasticars). He wouldn't be fighting with the SEC (which defends the public from costly stock swindles, which is why they've been investigating Musk for seven years). He could, instead, go after private sector Medicare waste. 33 million seniors have been suckered into switching from federally provided Medicare to privately provided Medicare Advantage. Overbilling from Medicare Advantage (whose doctors are ordered to "upcode" patients to generate additional bills) costs the public $83b/year: https://www.medpac.gov/wp-content/uploads/2024/03/Mar24_ExecutiveSummary_MedPAC_Report_To_Congress_SEC.pdf Medicare Advantage patients are, on average, healthier than Medicare patients (Medicare Advantage giants like Unitedhealtcare cream off the cheapest-to-service patients). Yet, this healthy cohort costs more to treat than their sicker cousins on the public plan – the fraud costs us about 11-14% of the total Medicare bill, and we could save $140b/year by zeroing that out: https://pnhp.org/system/assets/uploads/2023/09/MAOverpaymentReport_Final.pdf Zeroing out Medicare Advantage overbilling would pay for "an out-of-pocket spending cap, a public drug benefit, and dental, hearing, and vision benefits" for every Medicare patient with tens of billions to spare. Of course, as Dayen points out, the guy in charge of Medicare is Dr Oz, who has spent years shilling for Medicare Advantage, while holding massive amounts of stock in Unitedhealthcare, the nation's largest Medicare Advantage provider, and the worst offender for Medicare Advantage overbilling. Then there's Medicare itself. Rates for Medicare doctor reimbursement are set by committees of specialists, who award themselves sky-high rates while paying rock-bottom wages to the frontline general practitioners who do the heavy lifting. Lowering specialists rates to match the rates paid in Canada and Germany would save the federal government $100b/year: https://cepr.net/rfk-jr-physicians-pay-schedules-and-the-elites-big-lie/ Then there's Big Pharma. For years, Congress legally forbade Medicare and Medicaid from negotiating drug prices, which is why the US government pays the highest rates in the world for drugs developed in the US, with US federal subsidies. US drug prices are 178% more than other wealthy countries, and many drugs are sold at 20-30x the cost of production: https://aspe.hhs.gov/reports/comparing-prescription-drugs A few of these drug prices are going to come down in the coming years, thanks to timid, but long overdue action from the Biden administration. To really tackle a source of government waste, the US government could use its "march in rights" to federalize production of the most expensive drugs: https://prospect.org/day-one-agenda/force-drug-companies-to-lower-prices/ One possibility floated by economist Dean Baker is for the US government to invest $100b/year in clinical trials, keeping the patents for itself and licensing multiple manufacturers to compete to produce these publicly owned drugs, which would save an estimated $500b/year: https://cepr.net/financing-drug-development-what-the-pandemic-has-taught-us/ Then there's price-gouging, useless middlemen like Group Purchasing Organizations who soak the public purse for $20b/year – a "moderate" enforcement action could cut that to $10b. Speaking of eliminating middlemen, community health centers are a way cheaper source of care than big hospitals – $2371/year cheaper per patient, per year. By subsidizing these, the US government could save another $20b/year: https://www.ohiochc.org/news/310956/Landmark-Study-Confirms-Medicaid-Cost-Savings-at-Health-Centers.htm Next, Dayen moves onto the Pentagon, which pulled in $841b last year but has failed seven consecutive audits: https://thehill.com/policy/defense/4992913-pentagon-fails-7th-audit-in-a-row-but-says-progress-made/ The DoD firehoses money over private sector contractors, like the $3.6b it hands over to Musk's Spacex every year – a number Musk hopes to grow through Spacex's participation in a new consortium: https://www.ft.com/content/6cfdfe2b-6872-4963-bde8-dc6c43be5093 Military contractor wastage is the stuff of legend, like the $2t F-35 Joint Strike Fighter, a lemon that has over 800 outstanding defects and was just greenlit for another year's worth of full funding: https://www.bloomberg.com/news/articles/2021-07-13/lockheed-f-35-s-tally-of-flaws-tops-800-as-new-issues-surface This kind of wasteage isn't merely shameful, it's illegal. The Nunn-McCurdy Act requires that these large-scale boondoggles be reviewed with an eye to shutting them down. But when beltway bandits like Northrop Grumman’s produce expensive lemons like Sentinel, the DoD continues to hand public money to them, citing "national security": https://www.defense.gov/News/Releases/Release/Article/3829985/department-of-defense-announces-results-of-sentinel-nunn-mccurdy-review/ The DoD contracts out so much of its essential functions that it literally doesn't know what it has. It pays contractors and subcontractors to produce parts for its systems, but has no way to know if those parts have actually been produced. Meanwhile, private equity rollups like Transdigm have merged every single-source aerospace supplier and jacked up the price of spare parts for existing military systems, pulling down 4,500%+ markups: https://theintercept.com/2019/05/28/ro-khanna-transdigm-refund-pentagon/ To estimate the easy military savings – the ones that won't require shutting down jobs programs scattered in every key Congressional district – Dayen takes the CBO's estimate and cuts it in half, to get an annual savings of $150b/year. Then there's general prodcurement, where the GAO estimates the US loses $150b/year to bid-rigging and another $521b/year to fraud (the USG also spends $70b/year on management consultants who do no discernible useful work). Dayen estimates the annual savings from "stringently enforcing fraud and abuse, insourcing operations, and no longer paying for bad advice" at $150b/year. Then there's tax cheating. The IRS estimates that it undercollects about $606b/year in taxes. The top 1% account for $163b/year of that (Elon Musk's own effective tax rate is just 3.27% as of the five years preceding 2021, the year for which we have his leaked tax return; he paid no taxes in 2018). Every dollar the IRS spends on auditing brings in $2.17 in tax, and every dollar the IRS spends auditing the wealthy generates $6.29 in tax. A dollar spent auditing the top 10% brings in $10: https://www.timesfreepress.com/news/2024/dec/01/opinion-the-irs-shows-what-government-efficiency/ Audits are durable sources of tax. People who've been burned by an audit are far more honest in the decade after that audit. The GOP has zeroed out Biden's IRS increases. The CBO estimates that a fully funded IRS could easily increase the taxes it collected by a net figure of $200b/year. There's also new sources of tax. Dayen likes Dean Baker's proposal for taxes on stock returns: just add dividends and stock appreciation at the end of the year, then multiply by the tax rate. Baker says this is a loophole-free way to bring the effective corporate tax rate up from 20% to 25%, generating $65b/year: https://cepr.net/winning-the-tax-game-tax-stock-returns/ This would be especially hard on heavily financialized companies with "impossibly high stock price/earnings ratios" – e.g. Tesla. Dayen also proposes rejigging the tax rate on retirement and health insurance plans, where nearly all the tax breaks are scooped by the highest earners. The Tax Policy Center has $1.12-$1.38t/year worth of other tax reforms that would shift the tax burden from working people to the idle rich: https://taxpolicycenter.org/briefing-book/what-are-largest-tax-expenditures Dayen says, "let's ask for about 20% of that" and ballparks the tax income at $200b/year. How about subsidy cuts? $10b/year in fossil fuel subsidies. Eliminating the notorious sources of fraud in crop insurance would save $5b/year: https://www.gao.gov/assets/gao-06-878t.pdf There's $7b/year in subsidies to the Home Bank Loan system and $5b/year lost to pass-through entity loopholes. Add it all up and you're saving $1.4215t/year without even breaking a sweat, just by tacking (some of) the country's worst looting and tax evasion. Dayen points out US expenditures will fall even more than this, because it won't be paying as much T-bill interest if it doesn't spend this money. We could also just make the Fed stop using the blunt, expensive tool of interest rate hikes to manage inflation. There's plenty of scenarios where interest payments result in the remaining $580b/year in savings, bringing the total up to $2t. Now, sucking $2t/year out of the US economy all at once – even $2t in waste and fraud – would not be good for America! That kind of economic shock would bring the US economy to its knees, for years to come. All that money still fuels the demand side of the economy. But a slow rampup, and more public spending on useful programs (say, climate resiliency and retrofitting), would strengthen the economy while still bankrupting the fraud sector. DOGE is wildly unpopular with the American electorate – even large pluralities of Republicans think its stupid. Campaigning on cutting fraud and profiteering would be a wildly popular way for Democrats to separate themselves from Republicans. Few Democrats are rising to the occasion, though. (Image: Steve Jurvetson, CC BY 2.0, modified) Hey look at this (permalink) Labour’s decision to muzzle regulators in the name of ‘growth’ will backfire horribly https://www.theguardian.com/commentisfree/2025/jan/25/labours-decision-to-muzzle-regulators-in-the-name-of-growth-will-backfire-horribly We Only Have Ourselves: The How-Tos and DOs and DON’Ts of Mutual Aid https://lithub.com/we-only-have-ourselves-the-how-tos-and-dos-and-donts-of-mutual-aid/ Austin rents have fallen for nearly two years. Here’s why. https://www.texastribune.org/2025/01/22/austin-texas-rents-falling/ (h/t Hacker News) Object permanence (permalink) #20yrsago Gilberto Gil’s extraordinary engagement with Brazilians https://web.archive.org/web/20050130034511/http://www.lessig.org/blog/archives/002400.shtml #20yrsago Social Security “crisis” commentary that had me laughing aloud https://fafblog.blogspot.com/2005_01_23_fafblog_archive.html#110687103723037689 #20yrsago Details on cracking Apple’s iTunes DRM https://web.archive.org/web/20050129031800/http://osdir.com/Article3823.phtml #20yrsago Outstanding tips for community moderation https://nielsenhayden.com/makinglight/archives/006036.html#006036 #15yrsago Copyright-maximalist judges plagiarize lawblogger in opinion https://www.24oranges.nl/2010/01/23/judges-plagiarize-blog-posting-in-copyright-case/ #10yrsago Comcast ghost-wrote politicians’ letters in support of Time Warner Cable merger https://www.theverge.com/2015/1/26/7878239/comcast-twc-fcc-merger-letters-politicians-ghostwritten #10yrsago Koch brothers raise 2016 election warchest that’s on par with either party’s spend https://www.nytimes.com/2015/01/27/us/politics/kochs-plan-to-spend-900-million-on-2016-campaign.html #10yrsago Podcast: The case for … cities that aren’t dystopian surveillance states https://ia802809.us.archive.org/11/items/Cory_Doctorow_Podcast_325/Cory_Doctorow_Podcast_325_-_The_case_for_cities_that_arent_dystopian_surveillance_states.mp3 #5yrsago Listen: loudspeakers broadcast corona virus closure messages to the empty streets of Shanghai Disneyland https://twitter.com/dwnews/status/1221812589161799682 #5yrsago Amazon threatened to fire two tech workers who spoke about climate and Amazon’s business, then 357 more workers joined them https://amazonemployees4climatejustice.medium.com/amazon-employees-share-our-views-on-company-business-f5abcdea849 #5yrsago Climate denial has destroyed the libertarian movement https://jacobin.com/2020/01/libertarianism-climate-change-environment-private-property #5yrsago Why I won’t buy an Ipad: ten years later https://memex.craphound.com/2020/01/27/why-i-wont-buy-an-ipad-ten-years-later/ #5yrsago One of the CIA’s waterboarding torturers called himself “The Preacher” and shouted religious nonsense while performing executions https://www.theguardian.com/us-news/2020/jan/25/some-folks-were-tearful-cia-waterboarding-on-trial-in-guantanamo #5yrsago The privacy-invading, junk science “home DNA test” industry is cratering https://www.technologyreview.com/2020/01/23/276092/is-the-consumer-genetics-fad-over/ #1yrago Solar is a market for (financial) lemons https://pluralistic.net/2024/01/27/here-comes-the-sun-king/#sign-here Upcoming appearances (permalink) Picks and Shovels with Ken Liu (Boston), Feb 14 https://brooklinebooksmith.com/event/2025-02-14/cory-doctorow-ken-liu-picks-and-shovels Picks and Shovels with Charlie Jane Anders (Menlo Park), Feb 17 https://www.keplers.org/upcoming-events-internal/cory-doctorow Picks and Shovels with Wil Wheaton (Los Angeles), Feb 18 https://www.dieselbookstore.com/event/Cory-Doctorow-Wil-Wheaton-Author-signing Picks and Shovels with Dan Savage (Seattle), Feb 19 https://www.eventbrite.com/e/cory-doctorow-with-dan-savage-picks-and-shovels-a-martin-hench-novel-tickets-1106741957989 Picks and Shovels at Another Story (Toronto), Feb 23 https://www.eventbrite.ca/e/picks-shovels-cory-doctorow-tickets-1219803217259 Picks and Shovels with John Hodgman (NYC), Feb 26 https://www.eventbrite.com/e/cory-doctorow-john-hodgman-picks-and-shovels-tickets-1131132841779 Picks and Shovels (Penn State), Feb 27 https://www.bellisario.psu.edu/assets/uploads/CoryDoctorow-Poster.pdf Picks and Shovels at the Doylestown Bookshop (Doylestown, PA), Mar 1 https://www.eventbrite.com/e/cory-doctorow-picks-and-shovels-a-martin-hench-novel-tickets-1146230880419 Picks and Shovels at Red Emma's (Baltimore), Mar 2 https://redemmas.org/events/cory-doctorow-presents-picks-and-shovels/ Picks and Shovels with Lee Vinsel (Richmond, VA), Mar 5 https://fountainbookstore.com/events/1795820250305 Picks and Shovels at First Light Books (Austin), Mar 10 https://thethirdplace.is/event/cory-doctorow-picks-shovels-1 Picks and Shovels at Dark Delicacies (Burbank), Mar 13 https://www.darkdel.com/store/p3257/Thu%2C_Mar_13th_6_pm%3A_Pick_%26_Shovel%3A_A_Martin_Hench_Novel_HB.html#/ Cloudfest (Europa Park), Mar 17-20 https://cloudfest.link/ Picks and Shovels at Imagine! Belfast (Remote), Mar 24 https://www.eventbrite.co.uk/e/cory-doctorow-in-conversation-with-alan-meban-tickets-1106421399189 ABA Techshow (Chicago), Apr 3 https://www.techshow.com/ Teardown 2025 (PDX), Jun 20-22 https://www.crowdsupply.com/teardown/portland-2025 DeepSouthCon63 (New Orleans), Oct 10-12, 2025 http://www.contraflowscifi.org/ Recent appearances (permalink) A radical plan to fight U.S. tariffs and build an export industry jailbreaking consumer products from iPhones to tractors https://www.cbc.ca/listen/live-radio/1-14-day-6/clip/16123612-a-radical-plan-fight-u.s.-tariffs-build-export Right to Repair with Karen Sandler (Software Freedom Conservancy): https://videos.trom.tf/w/q1AAL629GYMFtN6nCy15WE Just Say It's Capitalism (This Week in Tech) https://twit.tv/shows/this-week-in-tech/episodes/1014?autostart=false Latest books (permalink) The Bezzle: a sequel to "Red Team Blues," about prison-tech and other grifts, Tor Books (US), Head of Zeus (UK), February 2024 (the-bezzle.org). Signed, personalized copies at Dark Delicacies (https://www.darkdel.com/store/p3062/Available_Feb_20th%3A_The_Bezzle_HB.html#/). "The Lost Cause:" a solarpunk novel of hope in the climate emergency, Tor Books (US), Head of Zeus (UK), November 2023 (http://lost-cause.org). Signed, personalized copies at Dark Delicacies (https://www.darkdel.com/store/p3007/Pre-Order_Signed_Copies%3A_The_Lost_Cause_HB.html#/) "The Internet Con": A nonfiction book about interoperability and Big Tech (Verso) September 2023 (http://seizethemeansofcomputation.org). Signed copies at Book Soup (https://www.booksoup.com/book/9781804291245). "Red Team Blues": "A grabby, compulsive thriller that will leave you knowing more about how the world works than you did before." Tor Books http://redteamblues.com. Signed copies at Dark Delicacies (US): and Forbidden Planet (UK): https://forbiddenplanet.com/385004-red-team-blues-signed-edition-hardcover/. "Chokepoint Capitalism: How to Beat Big Tech, Tame Big Content, and Get Artists Paid, with Rebecca Giblin", on how to unrig the markets for creative labor, Beacon Press/Scribe 2022 https://chokepointcapitalism.com "Attack Surface": The third Little Brother novel, a standalone technothriller for adults. The Washington Post called it "a political cyberthriller, vigorous, bold and savvy about the limits of revolution and resistance." Order signed, personalized copies from Dark Delicacies https://www.darkdel.com/store/p1840/Available_Now%3A_Attack_Surface.html "How to Destroy Surveillance Capitalism": an anti-monopoly pamphlet analyzing the true harms of surveillance capitalism and proposing a solution. https://onezero.medium.com/how-to-destroy-surveillance-capitalism-8135e6744d59?sk=f6cd10e54e20a07d4c6d0f3ac011af6b) (signed copies: https://www.darkdel.com/store/p2024/Available_Now%3A__How_to_Destroy_Surveillance_Capitalism.html) "Little Brother/Homeland": A reissue omnibus edition with a new introduction by Edward Snowden: https://us.macmillan.com/books/9781250774583; personalized/signed copies here: https://www.darkdel.com/store/p1750/July%3A__Little_Brother_%26_Homeland.html "Poesy the Monster Slayer" a picture book about monsters, bedtime, gender, and kicking ass. Order here: https://us.macmillan.com/books/9781626723627. Get a personalized, signed copy here: https://www.darkdel.com/store/p2682/Corey_Doctorow%3A_Poesy_the_Monster_Slayer_HB.html#/. Upcoming books (permalink) Picks and Shovels: a sequel to "Red Team Blues," about the heroic era of the PC, Tor Books, February 2025 Enshittification: Why Everything Suddenly Got Worse and What to Do About It, Farrar, Straus, Giroux, October 2025 https://us.macmillan.com/books/9780374619329/enshittification/ Unauthorized Bread: a middle-grades graphic novel adapted from my novella about refugees, toasters and DRM, FirstSecond, 2025 Colophon (permalink) Today's top sources: Currently writing: Enshittification: a nonfiction book about platform decay for Farrar, Straus, Giroux. Status: second pass edit underway (readaloud) A Little Brother short story about DIY insulin PLANNING Picks and Shovels, a Martin Hench noir thriller about the heroic era of the PC. FORTHCOMING TOR BOOKS FEB 2025 Latest podcast: The Weight of a Feather (The Weight of a Heart) https://craphound.com/overclocked/2025/01/26/the-weight-of-a-…eight-of-a-heart/ This work – excluding any serialized fiction – is licensed under a Creative Commons Attribution 4.0 license. That means you can use it any way you like, including commercially, provided that you attribute it to me, Cory Doctorow, and include a link to pluralistic.net. https://creativecommons.org/licenses/by/4.0/ Quotations and images are not included in this license; they are included either under a limitation or exception to copyright, or on the basis of a separate license. Please exercise caution. How to get Pluralistic: Blog (no ads, tracking, or data-collection): Pluralistic.net Newsletter (no ads, tracking, or data-collection): https://pluralistic.net/plura-list Mastodon (no ads, tracking, or data-collection): https://mamot.fr/@pluralistic Medium (no ads, paywalled): https://doctorow.medium.com/ Twitter (mass-scale, unrestricted, third-party surveillance and advertising): https://twitter.com/doctorow Tumblr (mass-scale, unrestricted, third-party surveillance and advertising): https://mostlysignssomeportents.tumblr.com/tagged/pluralistic "When life gives you SARS, you make sarsaparilla" -Joey "Accordion Guy" DeVilla
