OPINION:
How can Americans continue putting nose to grindstone, saving hard-earned money and spending wisely, when Uncle Sam and his deputies trash the cash they extract from conscientious taxpayers? As 2024 unfolds, the greenback isn’t getting any respect from public servants.
The Federal Reserve, responsible for safeguarding the dollar, announced Friday it lost $114.3 billion last year. It was the central bank’s first yearly operating loss of the 21st century and its largest ever. Rather than scrambling to right its fiscal situation, the institution wrote an IOU, labeled a “deferred asset.”
At the height of the coronavirus pandemic, the Fed propped up the U.S. economy with cash raised with the purchase of Treasury notes and mortgage-backed securities. To cool the resulting inflation, which peaked at 9.1%, the central bank rose interest rates 11 times. As the value of those securities has since plummeted, the Fed must now pay them off at higher interest rates.
When Washington fails to safeguard the value of the dollar, the practice becomes contagious.
The government carpeted the land with COVID-era relief funds, and little regard was given to verifying eligibility. Authorities reckon that more than $500 billion in unemployment and paycheck protection funds were stolen and spent on mansions, automobiles and vacations.
In addition, Americans have recently learned that the Department of Defense under President Biden lost more than $1 billion worth of advanced armaments sent to assist Ukraine in repelling Russia’s invading army. Oops.
Among the missing military materiel are shoulder-fired missiles, kamikaze drones and night vision goggles, according to the Pentagon’s Office of Inspector General. Such weapons require close tracking, but the whereabouts of more than half of these weapons shipped to the Ukrainians, worth a total of $1.7 billion, are unknown.
Watching how careless senior government bureaucrats can be with taxpayer funds, lower-level feds feel free to behave similarly. A glaring example is one Janet Yamanaka Mello, 57, a civilian employee of the Army in San Antonio who was charged earlier this month with stealing more than $100 million in government funds.
Ms. Mello is accused of secretly moving the money into a shell company over six years, using her boss’s electronic signature. Arrested only after she allegedly bought 31 properties and 80 high-end vehicles spread over five states, she was released from custody without bail. Federal judges don’t treat misuse of government money in the millions as a serious offense, apparently.
The same seems to hold true in the private sector. Shoplifting is treated as a misdemeanor in two-thirds of the 50 states, so long as the value of the theft adds up to less than $1,000. This sort of legal laxity has led to annual U.S. retail losses of $100 billion.
Money has meaning only when members of society share a belief that its paper and digital forms represent the genuine value of human labor and the goods it produces. When the U.S. government treats the trillions it extracts from taxpayers like Monopoly money, it shouldn’t be surprising when Americans are tempted to do the same.
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