Our Government, Dr. Frankenstein

As the stimulus program winds down, we learn more about how our federal dollars were spent.

The latest story reports that the inspector general for the Social Security Administration examined the $250 payments made to senior citizens under the stimulus bill.  The inspector general determined that 72,000 of the $250 payments — $18 million in all — were made to the dearly departed, and another $4.3 million went to 17,000 prison inmates.  Nice to know that our frankensteinian government is seeking to stimulate the dead, and the imprisoned!  Is anyone checking to see whether the trade in cigarettes and illicit goods at San Quentin has flourished as a result?

The article reports that a little more than half of the improper payments to those already dead were returned, and I suppose we should be grateful that so many relatives were honest.  The article makes no mention of how many prisoners acted similarly, however.

45 thoughts on “Our Government, Dr. Frankenstein

  1. Very good post! Congratulations on being freshly pressed Where is the miraculous politician that they all promise to be who will acually put an end to these things?

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  2. Nice post and congrats on Freshly Pressed again! I wish I understood more about how and who makes these stupid mistakes and its nice to know some people were honest enough to give it back. Although they were probably scared of the government wanting the money back plus interest in 4 years. Someone hopefully lost a job over this sure they would get it right if it was coming out of their own pocket.

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  3. Is it against the law for prisoners to receive S.S. checks?

    These dead people could have passed away between the time the checks were issued and the time they arrived in the mail. I’m sure dead people receive phone bills and annuity payments every day too.

    Think.

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    • Believe it or not, I thought about it before I submitted the post.

      Remember, these were not standard Social Security checks — they were special $250 checks intended to stimulate the economy. Was it really too much to ask for the government to check whether people were alive, dead, or imprisoned before millions of dollars were distributed? And is it really fair to taxpayers to send millions of dollars in special payments to prisoners — especially when times are tough for everyone and we are borrowing money to do so?

      I don’t think it is unreasonable to hold our government accountable for its actions, and I don’t think it does us any good to make excuses for our government when it commits a blunder. In this case, thousands of checks and millions of dollars were sent to improper recipients who couldn’t use the money for its intended purposes. I don’t think it is unfair to point that out.

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      • Of course the government should be held accountable, and I’m not making excuses, but unless the government can predict the future, how would they know someone was about to die when they issue a check? If it can be shown that these checks went to people that had been dead for years, that’s a different story, but I did not see any evidence of that in your post or the linked article.

        As for the prisoners, if they spend the money, then it IS being used for its intended purpose. If they don’t, then they’re no worse than the large banks sitting on TARP money instead of lending it like they were suppose to. (The latest estimate of liquid assets (cash)held in reserve by American corporations is 1.4 trillion dollars, twice the amount of the stimulus.)

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      • I think that if the person were alive when they filed taxes that year but had passed by the time the stimulus check arrived is an understandable mistake.

        How do you deterine who to ckeck on for death records? Do you pick an age and check everyone over that age? How do you determin a reasonable cut off age for checking? What about people who were ill or in accidents? The massive amount of work it would have taken seems a little unreasonable to expect.

        As for people in prision, a stimulus check to jump start the sagging economy would be useless in jail. They wouldn’t be able to use it in a venue that would have an impact on the economy. Except, perhaps, to order books or magazines subscriptions. People in jail still have to fill out tax forms. So I guess that would put them on the rolls for stimulus checks.

        But I agree that it seems a silly thing to do when that money is more likely to end up sitting in the inmate accounts rather than being spent where it could do any good.

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  4. According to wikipedia the measures are nominally worth $787 billion in total. So please put your mentioned 4.3 million in perspective.

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  5. Sorry, you mentioned $18 million that went to the death and imprisoned. Still a very small number compared to the total investments or tax breaks.

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    • I think your point about putting these payments into context is a fair one — although I don’t think the $787 billion number is the right context, since that number refers to all stimulus-related programs and the Inspector General report discussed in this post only examines a small part of the total stimulus bill. I think the more appropriate context is the total amount of the stimulus package devoted to sending $250 checks out to Social Security recipients.

      According to the NPR story on the Inspector General report, the total amount of the $250 check program was $13 billion. You are correct that the $22.3 million in payments to the imprisoned and the dead is but a fraction of that $13 billion total.

      Still, $22.3 million seems like a lot of money to me. Candidly, the fact that the federal government is spending $13 billion to disseminate $250 checks does not make me feel better about wasting $22 million.

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  6. haha! INSANE! I saw an article about this, but it was regarding Japan’s pensions…. they don’t have as many centenarians (100+ year old people) as they thought. Their families have just been collecting their pensions for YEARS (decades, even) and didn’t report the deaths!
    THinking of what this money could have done instead…. oh man.
    Great picture with this post. COngrats 🙂

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  7. Nice to know that we can look to our government as our example for throwing money away. And people wonder why I say that we should look to other countries for ideas in regards to fixing the broken system that we have been making due with.

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  8. I like the Dr. Frankenstein analogy, though I always thought of the government as the monster. It mostly does its own thing against the will of its creators.

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  9. Bureaucracy at its finest! I am thankful for my $$$ of dollars stimulus check that arrived in the early summer of 2008, however, and think that they should issue another round of them before the end of 2010. Remember, too much government accuracy may reveal skeletons real and conjured up upon all of us, past and future. ‘Jus’ sayin’…

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  10. Ah, but can you imagine how many fewer of those checks would have been written if the Fed government had up-to-date RDBMS software and databases; if strategic investments had been made in updating technology rather than handing over $550 Billion/year to companies like Exxon/Mobil, BP, ADM, ConAgra, and Massey Energy.

    When you actively work to “starve the beast” while feeding the lion, you get what you ordered: inefficiency.

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  11. Yes, in perspective it’s a drop in the bucket compared to $814 Billion dollars, but this kind of crap drives me up a wall. I don’t care if it was $2, the government has been throwing my hard earned money away since they started taking it from me in 1981. It’s typical of any government entity; can’t do anything right. This is why I love the Tea Party because finally people are getting fed up. I think if I were a family member who received one of these checks payable to a dead parent or sibling, I would’ve kept it, too. It was mine to begin with, wasn’t it?

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  12. The government reported its error. Half the money was returned. The amount in question was 22.3 million dollars. This in your eyes makes government a “Frankenstein Monster?”

    Could you generate some outrage over the hundreds of thousands of mortgage foreclosures down without any examination of the record even so much as to determine if the property was actually owned by the forecloser?
    For two years the mortgage companies pretended to have done the legal work necessary to take people’s homes during which they assured the courts that they had done the necessary work. As a result there can be little doubt that thousands of homes were taken that should not have been and that hundreds of thousands of homeowners now owe more and will receive less money than they should on the resale.
    Of that 22.3 million dollars, will the government seek return of the missing funds? There can be little doubt that they will. Will they get all the money back? Probably not, but they will get most of it. Was it a deliberate mistake? No.
    Did these mortgage companies intend to mislead the courts? Yes. Did they profit enormously for it? Yes. How much? Minimally several billion dollars. Will that money be returned? Not voluntarily, state and federal lawsuits may return some of it, but the pain of being thrown out of one’s home is probably not easily fixable.

    Which is worse?

    Must be the Frankenstein Monster, you know, the one that tells when it make a mistake.

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  13. I enjoyed your article and enjoyed the defenders of government waste found in the comment section as well. The $814 (CBO revised) stimulus was nothing more than wasted tax dollars, since it did the opposite of what was claimed. On top of this, we had stimulus dolllars going to imaginary zip codes and congressional districts.

    However, we should all cheer up, these same idiots are going to save us $$$ by cutting waste and fraud in ObamaCare. I’m sure we will see these same results.

    By the way, this was just the democrats paying back their constituents: the dead and the criminals.

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  14. Are people confined in prison still entitled to social security if they were receiving it prior to confinement? If so, the checks were sent properly.

    Social security does not know if someone is dead until they receive a death certificate. I had problems with SS for my mom two months after she passed, even though I sent them her death cert as less than a week after she died. I had to call them and ask them where I sent her checks back to. Governments always move slow.

    It’s a non-story pulled for political purposes only.

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  15. So, less than a tenth of a percent of the checks went awry, and the rest of them helped save our nation.

    Cheap at any reckoning. Hoorah for the stimulus! Shame on those who say we shouldn’t do it again to avoid another recession next year.

    TARP and the stimulus saved our nation — and all we get is cheap carping from the do nothings.

    http://timpanogos.wordpress.com/2010/10/05/tarp-saved-my-nation-and-all-i-got-was-this-bitter-cold-tea-party/

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  16. According to the article you linked to, the checks were sent to “about 52 million Social Security recipients and federal retirees”, 72,000 of whom were dead. If it’s outrageous that each of these 72,000 people received a single $250 check, isn’t it even worse that those same people may be receiving their regular Social Security or Federal pension checks? Is a 99.9% accuracy rate okay for regular benefit payments but not for a one-time stimulus payment?

    You’ve suggested that the government should verify that people are alive (and not in prison) before sending out checks. Okay — how much should the government spend to perform that verification? If it costs a dollar to verify each person’s status, and there are potentially 52 million recipients, then the government would have to spend $52 million. Does it really make sense to spend $52 million to save $22.3 million (or, more accurately, less than $13.3 million, since more than $9 million was returned)?

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    • I think your points are interesting and worth a brief response.

      I guess I do feel that regular payments are different from stimulus payments — and I’d also like to think that the government has procedures in place to check as a matter of course on whether the intended recipients are living, dead, or imprisoned.

      I think “stimulus” payments are different from regular Social Security payments because the regular payments are an entitlement, and the $250 “stimulus” checks were a kind of bonus, intended to go to certain people to stimulate the economy. Is it really asking too much to make sure that, before we send borrowed money out to those lucky recipients, they are the right recipients?

      You may be right about the $1 cost to verify, but I’m a bit skeptical. Why would it cost anything for our current government employees to do the verification process as part of their regular jobs? Couldn’t they simply use their existing systems to check on whether the recipients were imprisoned or deceased? If they didn’t perform any kind of verification process, doesn’t that indicate a real problem?

      Many of the comments to this post note, correctly, that the improper payments went to a small percentage of the intended whole. I don’t think that is a meaningful defense for making millions of dollars in improper payments. In my book, a million dollars is still a lot of money, and it is just unacceptable that millions and millions of dollars in payments went to criminals and the dead.

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      • Presumably the government is using its normal verification process — the article you cited said the recipients were on the Social Security and Federal pension rolls — and if the numbers in your article are accurate, that process is 99.9% (or maybe just 99.8%) accurate. To get a higher level of accuracy, you’d need to do more stringent verification, which would cost more.

        The SSA actually publishes a table that shows the probabilities that people will die within a year at different ages (http://www.ssa.gov/OACT/STATS/table4c6.html). If we assume the average yearly mortality rate for people receiving Social Security / Federal pensions is 1.4% (the average of the male and female 65-year-old percentages), then an average of about 1994 of the 52 million people in this group will die every day. Even if you have a zero-cost verification process that’s 100% accurate, if there’s a 24-hour delay between when the verification process completes and when the checks are cut, then 1994 of the people who were alive when they were verified will be dead when their checks are issued. If you verify everyone at 5pm on a Friday and send the checks out at 8am the following Monday, then more than 5000 of the people who were alive when verified will have died over the weekend; at $250 per person, that’s $1.25 million in checks to the dead. And that’s assuming the verification process is instantaneous — if you verify half the potential recipients on the first day and half on the second day, then about 1000 of the people who were verified the first day will be dead by the time the verification process is completed.

        I guess what I’m saying is that getting high levels of accuracy is more difficult that it may appear at first, and when you’re talking about 52 million people, the numbers add up pretty quickly.

        Thanks for reading this far; it’s nice to see a discussion on this topic that doesn’t degenerate into political posturing.

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  17. Hi there,

    First off, your blog is great. I’m impressed, love the subject material, the consistent posts and the format. Can I ask you what prompted you to start this blog?

    Thanks.

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    • Thanks for the kind words about our humble little blog.

      A few years ago I began reading blogs. I thought they were interesting, both as an information source and as a kind of social phenomenon, and mentioned to Richard that we should have a family blog, since we have different views and different perspectives on things. He did some research on blog hosting options and concluded that WordPress was the best option (a conclusion that I agree with).

      My Christmas present in 2008 was this blog. We set it up and started posting in February 2009. It’s turned out to be one of the best Christmas presents I’ve ever gotten — it’s a heck of a lot more fun than a tie or cologne!

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  18. I think that’s great. I am thinking about getting one started myself, my background is in politics – which is why I really have an affinity to yours. Keep up the great work!

    -Niki

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  19. That’s one of the big reasons why the government is supposed to keep its filthy paws off the economy! There’s a reason why the founding fathers espoused the philosophy of laissez faire in both the economy and the private affairs of its citizens.

    The current trends of burgeoning taxation and government control of the economy should be viewed as a threat looming large over this country chipping away at the citizens’ liberty and freedom.

    Economic stimulus packages and similar social welfare programs don’t help to alleviate the rough areas of the economy and wind up costing the taxpayers more in the end. Simple logic would dictate that a larger federal government with more programs and initiatives will cost the people more than a decentralized federal government with minimal bureaucratic structure would cost.

    This also points out the great need this country has for transparency in government. We the people have a right to know what happens behind closed doors at all levels of the federal government – it’s part of our constitutionally ensured liberty. Moreover we as taxpayer just plain and simple need to see where and to who our hard earned money is going.

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  20. Liberty81 said:

    The current trends of burgeoning taxation and government control of the economy should be viewed as a threat looming large over this country chipping away at the citizens’ liberty and freedom.

    Or, we could view it as part of the genius of Alexander Hamilton’s system. Don’t ever forget: Our Constitution was created to make up for a fatal flaw in the Articles of Confederation, the inability to lay and collect taxes. Our nation was founded, in large part, to collect taxes, to change our deadbeat government into a thriving government that could pay its debts and defend our shores.

    Economic stimulus packages and similar social welfare programs don’t help to alleviate the rough areas of the economy and wind up costing the taxpayers more in the end. Simple logic would dictate that a larger federal government with more programs and initiatives will cost the people more than a decentralized federal government with minimal bureaucratic structure would cost.

    Except that economists have the studies that show economic stimulus packages work. Our most recent stimulus package saved millions of jobs, and kept us from a second Great Depression.

    “Simple logic” should take into account the functions of the federal government, and the size, breadth and scope of our nation. Turning the U.S. into the Balkans won’t build roads, improve the science research that drives our economy, defend our nation from harm, nor explore Mars.

    Private insurance companies pay out about $10 per claim processed, to process the claim. Medicare pays out less than $1. The facts run exactly contrary to your simple logic. Let’s stick with the facts.

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