Obama's Ongoing War on Inspectors General
By Ed Lasky
A cloud of suspicion hangs over the data Barack Obama and his team have been presenting us regarding the purported success of their own programs.
The figures presented regarding "jobs created and saved" have been contested. The new metric regarding jobs "saved" has been ridiculed as just a tactic to burnish the numbers. Analysts have looked at various expenditures and have shown in example after example that each job created is often temporary in nature, sometimes occurs overseas, and is often extremely expensive.
The figures regarding ObamaCare -- be they the costliness of the program, its effect on the deficit, or the number of uninsured -- are roundly considered suspect, if not an outright numerical analogy to snake-oil claims.
Climate change is another theological belief held by the higher-ups in this administration -- facts and figures be damned.
The problem is exacerbated when models are created to justify the ideological ends of proponents of various programs (the so-called hockey-stick model of climate change, for example). Models then have fudged numbers put in them to -- voilà! -- create the desired outcomes.
Mark Twain, who coined the phrase "lies, damn lies, and statistics," would certainly have had a great deal of raw material to use in his satirical screeds regarding politicians -- especially this bunch inspired by the mores of Cook County.
Taxpayers pay the price, of course. We always do.
But we have some people looking out for our futures in the government -- and these people have been subject to a great deal of pressure from the White House.
These are the inspectors general -- the unsung heroes of the government who monitor government agencies.
They take their duties to the taxpayers seriously. We are lucky to have them looking out for waste and corruption. For the last two years, they have stood up and reported on waste of taxpayer dollars and various other suspect activities.
This is precisely what seems to have earned them pride of place on Obama's ever-growing enemies list.
The latest one to report on Obama shenanigans is the inspector general for the Small Business Administration (SBA), who reports that the agency's numbers for "jobs saved" were either "unclear" or "misleading" and cannot be verified.
The SBA received over $700 million under the American Recovery and Reinvestment Act (the stimulus act). The federal agency was required to report on job statistics flowing from the stimulus. The SBA made loans to small businesses and was supposed to check on the number of jobs created.
The SBA did so monthly on its website. The inspector general audited these numbers and found them wanting -- to say the least.
From World Net Daily:
The inspector general reported that the loan programs' "lack of a definition for 'jobs retained' and the discrepancy in the forms used to collect job statistics from 7(a) borrowers and lenders has resulted in a performance metric with questionable clarity and transparency."
The inspector general, what is more, indicated that only one of the programs, the 504 program, even asked loan applicants how many jobs are to be saved. The other program, the 7(a) program, made something of a leap of faith as to jobs created.
"In the 504 loan program, where job creation and retention is a program criteria, applicants are required to report the number of current employees, jobs to be created in the next two years, and jobs to be retained because of the loan," the IG report said.
Applicants for the 7(a) program, meanwhile, were just asked to report on their application the number of employees at the time of application and the number of employees "if [the] loan is approved."
As the inspector general noted, as a result of this shoddy methodology, the report "results in unclear and misleading reporting."
I have written a series of columns that reveal a pattern. One inspector general after another faults the Obama administration for using suspect methodology to burnish its claims regarding job creation. At one point, Obama wanted to create a brand new $30-billion government program to grant loans to small business. The program was designed to be free of any oversight by inspectors general. This program had the potential to be a thirty-billion-dollar slush fund to channel taxpayer dollars to those people who are allies of the Obama administration.
This was not the first time the Obama team tried to elude oversight
Obama's Office of Management and Budget (OMB) threatened an inspector general for daring to tell Congress that the OMB was trying to slash his budget, crimping his ability to monitor spending and other actions by the OMB.
The administration fired Inspector General Gerald Walpin after he dared to report that Sacramento's mayor, a Democrat and personal friend of Barack Obama, had engaged in improper use of federal money.
From the Wall Street Journal:
A George W. Bush appointee, Mr. Walpin has since 2007 been the inspector general for the Corporation for National and Community Service, the federal agency that oversees such subsidized volunteer programs as AmeriCorps. In April 2008 the Corporation asked Mr. Walpin to investigate reports of irregularities at St. HOPE, a California nonprofit run by former NBA star and Obama supporter Kevin Johnson. St. HOPE had received an $850,000 AmeriCorps grant, which was supposed to go for three purposes: tutoring for Sacramento-area students; the redevelopment of several buildings; and theater and art programs.
Mr. Walpin's investigators discovered that the money had been used instead to pad staff salaries, meddle politically in a school-board election, and have AmeriCorps members perform personal services for Mr. Johnson, including washing his car.
At the end of May, Mr. Walpin's office recommended that Mr. Johnson, an assistant and St. HOPE itself be "suspended" from receiving federal funds.
Recall Obama's taunt that if people brought a knife to a fight, he would bring a gun. In Walpin's case, he brought an axe -- since Walpin was fired from his job in the wake of his report on Johnson. But this was not enough punishment. Administration officials then went on the warpath as they heaped personal abuse on Walpin.
The war on the inspectors general continued. Maybe some inspectors generals did not get the memo that they were supposed to fall in line and ignore their professional obligations to taxpayers. Of course, the hypocrisy is palpable. Wasn't it Barack Obama who promised transparency in government?
Neil Barofsky, a Democrat, is the special inspector general of the Troubled Asset Relief Program (SIGTARP). He is another inspector general who found serious flaws behind administration claims. He thrashed the Treasury for relying on self-reporting by recipients of TARP money. He wrote that the bailout was falling short of many of its goals, like preserving home ownership and stimulating the economy. He also reported that the Treasury had switched accounting methods in order to promote the view that taxpayers would profit from the AIG bailout. One analyst depicted the Treasury's new accounting method as "Enron-style" accounting.
When companies switch accounting methods, a red flag is raised -- and short sellers of a public company's stock smell blood in the water. The funny business leads people to believe that officials are trying to present a false positive image regarding the business. Barofsky thought it was wrong and that the Treasury (Obama's Treasury) was failing.
What happened? I think we know the script by now. The administration heaped personal abuse on Barofsky.
Jen Psaki, who goes back to the Obama campaign, serves as the deputy communications director at the White House. And communicate she did.
On her blog, she attacked Barofsky:
Some people don't like movies with happy endings[.] ... How else to explain this week's report by Sigtarp? Rather than focusing on the growing evidence we've seen in recent months that TARP will be far less costly than anyone expected, Sigtarp instead sought to generate a false controversy over AIG to try and grab a few, cheap headlines.
The name calling and vilification continue for seven more paragraphs.
Here, we have Obama's modus operandi regarding inspectors generals -- the taxpayers' best friends and the unsung heroes in government.
One after another, inspectors general have been reporting that Obama's stewardship of taxpayer money has failed and that the administration has been using funny numbers to bamboozle the public into believing that the programs are succeeding. When the proverbial you-know-what hits the fan, the administration retaliates. The strategy seems to be to stop the criticism -- and to prevent it from happening in the first place, since whistle-blowers will fear what may happen to them if they tell the truth. Welcome to Chicago politics writ large.
Darrell Issa, the new chairman of the House Oversight and Government Reform Committee, has announced plans to investigate how the administration has spent our money. He has also expressed a desire to expand the powers of inspectors generals. Lord knows they will need the power to counter the machinations of Barack Obama and Company.