Third Party & Independents Archives

How State Controls Spending on Stemware

$5 million on stemware - as in really nice glasses for all sorts of beverages - for US embassies is actually reasonable, if you consider that there are hundreds of embassies around the world. And one has to assume that breakage or missing-in-action drains the embassies’ inventory of fine crystal and other fancy glass stemware. Over $26,000 for North Face parkas is, however, a little puzzling. Don’t ambassadors get well paid and briefed on where they’re going. As in the weather in Ulan Bator or Helsinki or Moscow? And don’t their salaries and allowances generously cover expenses on an individual basis?

These tidbits come from a study by Fichtner and Greene from the Mercatus Center at George Mason, which reveals that government departments have a perverse incentive to spend any unallocated funds before the government fiscal year ends in mid-fall. That means September is a booming month for frantic grant proposal approvals or any purchase by any department worried that Congress will cut back their budgets if unspent funds are visible at fiscal year end. And no department head would ever want that. You have your funds cut back, you lose power in Washington and every other government department across the country. That's true in business as well, except for the tiny difference of having to make a profit and justify a loss. So government spending has been a (generally) slightly rising percentage of the economy, sometimes brushing up against 40%, or even blasting past it, and more often somewhere around 30-something percent. You grow your business, government takes a bigger absolute slice, and sometimes a bigger relative slice. You earn more, same thing. The tax code itself, in other words, incentivizes government agencies, departments, and offices in general to ensure that their budget never gets cut. Because the tax receipts keep rolling in.

So you can be sure that at the State Department, a symbol of America around the world, spending is controlled very carefully. As in ensuring as much as possible is lavishly spent on whatever need can be imagined. Because the last thing an ambassador or consul or State official wants to project is efficiency or God forbid, a little frugality. It is America after all that they are representing. Perhaps other ways to project power, like the policies you inform other governments that your administration and Congress is enforcing, or the trade deals you help put together, or the information you relay back and forth in a dangerous, constantly shifting world, are seen by them as vital as well. Beyond the stemware and the parkas. One hopes so at least.

Posted by AllardK at April 18, 2015 8:43 PM
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