The Feds Misplace $21 Trillion and a School Shooter

by | Feb 19, 2018

Americans are rightly chagrined that the FBI had known that Florida mass killer Nikolas Cruz was a threat but didn’t follow up on the information.

But Americans shouldn’t be surprised.

In addition to misplacing a potential shooter, the feds have misplaced $21 trillion.  If they can misplace $21 trillion, they can certainly misplace one bad guy.

A February 13 story in City Journal details how the $21 trillion was misplaced.  It seems that when federal agencies can’t balance their books, they just plug in a number to make them balance. (

Between 1998 and 2015, the departments of Defense and Housing and Urban Development alone made “unsupported adjustments” of $21 trillion to their books.  That comes to about $136,000 per American household.  It also comes to more than the annual gross domestic product of the nation.


That’s the reaction I’ve gotten after publishing articles over the years about how the feds cook the nation’s books.  I’m either a lousy writer, or Americans don’t give a damn, or the lovers of big government in the media have been largely silent about this.  Or maybe the reason is all of the above.

The following is an excerpt from an article of mine that was published on Dec. 31, 2014:  “The government’s auditor, the General Accounting Office, has determined once again that the financial reports of the United States are not trustworthy.   The GAO said that the statements are so full of ‘material weaknesses’ that it cannot be determined if they are in ‘compliance with selected provisions of applicable laws, regulations, contracts, and grant agreements.’” (

Business executives would be jailed for such sloppy accounting.  Better yet, their businesses would go out of business and be replaced by more competent and ethical firms.  Nations also go out of business, but this can take centuries.

Double-entry bookkeeping was invented four centuries ago by an Italian, but the feds still haven’t mastered the simple concept.  So why do we expect them to have mastered much more difficult tasks, such as keeping tabs on bad guys, alerting Americans to Russian meddling in US elections, or reordering the Middle East?

The feds are masters at self-promotion, however.  They have convinced Americans that to keep the nation safe, they need bigger budgets, more personnel, swanker buildings, and more sophisticated snooping and eavesdropping software.

At the local level, public-school teachers and first responders also have mastered self-promotion.   Local governments have had to cut back on such services as filling potholes and maintaining infrastructure in order to pay their rich pensions and retirement benefits.  The states and cities that have caved the most to public-sector unions tend to be wholly owned by the Democrat Party and will benefit the most from Trump’s infrastructure plan, thus being rewarded for their profligacy and corruption in buying the votes of their union interest groups.

In the same vein, the FBI is petitioning Congress to spend billions of dollars for a new FBI headquarters, since it has outgrown the current HQ, due to the agency’s bureaucracy growing faster than its effectiveness, competency, and efficiency.

As an author of a book on bureaucracy, a longtime student of this organizational disease, and a consultant to organizations on how to cure it, I offer an Iron Law of Bureaucracy:  The larger an organization, the more bureaucratic it becomes; and the more bureaucratic it becomes, the more those at the top of the organization become out of touch with the bottom of the organization and turn into deadweight preoccupied with pay, perks, and office politics instead the organization’s mission.

Sound familiar?

Eventually, two watersheds are reached as bureaucracy takes hold:  First, a point of diminishing returns is reached, where each additional employee or dollar is less effective than the previous employee or dollar.  Then, sometime after that, a tipping point is reached, where each additional employee or dollar has a negative return.

It’s more than a coincidence that after Sears built the 100-story Sears Tower in downtown Chicago, it quickly lost touch with the marketplace.  And it’s more than a coincidence that the FBI lost touch with Nikolas Cruz after it had established a centralized department to keep track of leads about bad guys across the nation, thus diminishing the flexibility and judgment of local gumshoes.

Ballooning staff and corresponding bureaucracy are problems across all levels of government.  In 1941, there was one government employee at the federal, state and local levels for every 27.7 citizens.  Today, the ratio is one for every 14.6 citizens. If the ratio had kept pace with population growth instead of exceeding it, government would be smaller by millions of employees.

The growth of red tape has been even steeper, as measured by the number of pages in the Federal Register—numbers I won’t repeat here because they seem so farfetched that you might think I made them up.  Or the numbers might put you to sleep, assuming you’re not already asleep.

Federal bureaucrats, the White House, and Congress know that such numbers make citizens somnolent.  They also know that public schools and colleges that receive government money aren’t about to teach students about the problems of a ballooning government.  Moreover, the feds know that it is not in their best interest to streamline government.  Not only that, but lawyers comprise about half of Congress, and lawyers are horrible managers with little experience or interest in operational effectiveness.

Come to think of it, taking a nap is a better use of one’s time than trying to understand why the feds misplaced $21 trillion and the school shooter.  It’s the government, stupid!

Sweet dreams.

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