Politics & Policy

The Federal Government’s Unspent Billions

“Unobligated balances” sit in government accounts.

It’s enough to make a budget hawk lose his feathers.

Notwithstanding President Obama’s promise in his State of the Union address to freeze domestic discretionary spending for five years, Vice President Joseph Biden Tuesday proposed $53 billion in high-speed-rail projects — atop $8 billion so previously “invested.” This is every boy’s dream: the ultimate train set. Thank you, Santa!

For their part, congressional Republicans struggle to find $100 billion in budget cuts, even though their promise to do so fueled their historic election victories last November. So far, they have proposed just $74 billion in cuts for fiscal year 2011, $26 billion below this minimum threshold.

Meanwhile, more than $700 billion gathers dust in accounts all around Washington.

That’s right. An arcane budgetary category called “unobligated funds” includes money that Congress has appropriated for agencies and programs in every corner of the federal government. When that money goes unspent, it just sits there — like an ancient wooden chest on a Caribbean island, just waiting to be pried open.

Senator Tom Coburn (R., Okla.) holds the treasure map. He and his team cite an Office of Management and Budget document with the riveting title “Balances of Budget Authority — Budget of the U.S. Government — Fiscal Year 2011.”

On page 8, Table 1 indicates in black and white that this fiscal year’s federal budget contains $703,128,000,000 in “unobligated balances.” Thus, more than $703 billion languishes on department, agency, and program ledgers. This includes $12.2 billion unspent at the Agriculture Department, $16.4 billion at Labor, $25.2 billion at Housing and Urban Development, $71.4 billion at Defense, and $309.1 billion at Treasury.

While unspent obligated money must be stewarded for specific purposes for up to five years, these unobligated funds “have not yet been committed by contract or other legally binding action by the government,” OMB explains. Nonetheless, it might be wise to husband some of this money for legitimate purposes, such as military operations in Afghanistan and Iraq. Still, if only 20 percent of these funds could be liberated, then some $140.6 billion could be redirected immediately to reduce the deficit, freeze the national debt limit, or cut the corporate tax, and thus fortify America’s anemic economy.

In fact, Senator Coburn’s office estimates that $82.4 billion of these funds are between six and 20 years old! You read correctly: At this very second, the federal budget contains $82.4 billion that has hibernated in numerous accounts between FY 1991 and FY 2005. While agency chiefs and lobbyists might scream that these funds are sacred, such arguments become hilarious when applied to taxpayer dollars that have remained untouched for at least half a dozen years.

Team Coburn reckons that at least $100 billion of these unobligated funds safely could be applied to budget reduction. This could be done without padlocking the Smithsonian, dismissing air-traffic controllers, or showing Granny to her new home atop a subway grate. Hardly anyone would notice this simple act of accounting hygiene.

“Congress is approving increases in government funding faster than bureaucrats can spend it!” Senator Coburn told colleagues in January 2010. “While it is laudable that government bureaucrats are not spending every dollar that they are entrusted, this staggering amount of unspent money exposes the mismanagement of our national finances by Congress.”

Capitol Hill oversight committees should ask cabinet secretaries and agency heads a simple question: How much of the unobligated money on their books do they urgently need for vital public purposes, and how much can they relinquish at once for the overriding greater good — either making a significant down payment on America’s $14 trillion national debt or providing badly needed relief for this country’s fatigued individual and corporate taxpayers?

If Washington budget cutters get lucky, trunks full of gold doubloons may start washing up on federal property in Key West. Until that happy day, they should squeeze federal balance sheets for the hundreds of billions in unobligated funds available right now.

— New York commentator Deroy Murdock is a nationally syndicated columnist with the Scripps Howard News Service and a media fellow with the Hoover Institution on War, Revolution, and Peace at Stanford University. 

Deroy Murdock is a Manhattan-based Fox News contributor and a contributing editor of National Review Online, and a senior fellow with the London Center for Policy Research.


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