1. Mick West

    Mick West Administrator Staff Member

    Metabunk 2018-05-16 15-09-30.

    A comedy show on Russia Today starring Lee Camp (stand-up comedian and former writer for The Onion) has become the latest outlet to push an old debunked story - the idea that there are trillions of dollars missing from the Pentagon. This myth arose because the the Pentagon (i.e. the Department of Defense) has multiple different accounting systems across multiple departments. These systems have a serious problem: they are not "interoperable". This means that entries on one system do not automatically flow to another system.

    So when the military has to make quarterly or year-end financial statements, some entries, like the value of certain assets (like aircraft carriers) or liabilities (like pensions), have to be transferred either manually or by an automated but uncertified system. Because of this it's marked as "unsupported" because it lacks a rigorous audit trail. But it's not missing. It's just a long list of entries, like the value of the Navy's ships, that don't meet proper accounting standards. Since these things don't go away, the same entries can be made year after year, and you can add the numbers up to get bigger and bigger amounts. But it's not missing money or undocumented spending.

    This can be a difficult thing to understand. On a House Armed Services Committee hearing held on Jan 10 2018, Representative Walter Jones raised the issue, reading from a Reuter's article. Jones seem to have thought that the money was missing. Defense Department Comptroller, David L. Norquist, explained it to him.

    Source: https://www.youtube.com/watch?v=NoOFhjDjGqU

    And this is not a new story, it dates back to 2001 and before, in an April 2001 report, the DoD explained what the entries typically were for:
    • "Military pension actuarial liabilities" are "The amounts calculated based on actuarial assumptions that represents the present value of the pension benefits accrued in pension plans" - i.e. it's totals that will vary from year to year, but represents an estimate of how much money is needed in the future.
    • "Contingent liabilities" are amounts that the department will probably be liable for, things like class action lawsuits or defaulted loan guarantees. These estimates vary, can last for years, and again don't represent spending.
    • "Contract accounts payable" are amounts owed to contractors. The DoD pays slowly and the account goes though various stages. Here there are estimates of the totals of these various stages in different departments.
    • "Property and equipment values" are estimates of the values of things that the DoD owns. Things like buildings, weapons, fighter jets, fuel, battleships, etc. This is not spending, as they have already spent the money to acquire the asset. It's an estimate for things like depreciation, insurance, and replacement budgeting.
    All these things are accounting things that, as Norquist says "occur after the money is spent". They are things that you want to get right in your accounting, but if you get the values wrong then it does not mean you've lost the money. It means you've got some estimate wrong, and you'll put to little or to much in one fund or another.

    Nobody is saying that the defense department does not waste money. It very obviously does. Hundreds of millions, possibly even billions of dollars are wasted through inefficiencies, incompetence, and corruption. It is probably a measurable percentage of the Pentagon's budget. But the Pentagon's budget is around $600 billion. A measurable percentage of the Pentagon's budget is not $6.5 Trillion. That's ten times the amount of money that went into the Pentagon that year, and they still had to run the military. Clearly it's impossible to both spend most of the money you've been given, and also lose ten times that amount.

    Lee Camp spends a good portion of his comedy segments illustrating just how much money $6.5 Trillion (or $21 Trillion) is with comparisons to the GDP of the UK, and illustrations like how tall a stack of $1000 bills worth $6.5 trillion would be. These comparisons elicited only somewhat strained laughter from the RT studio audience, but that does perhaps illustrate the unfamiliarity most people have with "trillions", and the reason why this story continues to have legs. Losing $6.5 trillion from a budget of $600 billion almost looks like it makes sense. But is you put it like losing $6,500 billion from $600 billion, then the impossibility is a bit more apparent.

    How did we get here? The $6.5 Trillion number comes from a Jul 2016 report titled: Army General Fund Adjustments Not Adequately Documented or Supported, which goes some way to describe the complexity of the issue. But the $21 trillion comes from later work by Mark Skidmore, a Professor of Economics at Michigan State University, who added up a number of similar reported journal voucher issues over several years to come up with the larger number. This is just more of the same though, still not missing money, still just unsupported accounting information transfers.

    Skidmore has been skirting the conspiracy circuit with this idea. He co-authored a Forbes blog piece with Laurence Kotlikoff, he collaborated with Catherine Austin Fitts (a frequent guest on Coast-to Coast AM, and sometime 9/11 conspracist) in searching for the journal voucher adjustments, and he gave an interview with Greg Hunter supporting the idea that the numbers represented missing money. This insinuation has been accepted as fact by the more overt conspiracy community, like Alex Jones and David Wolfe.

    Like Norquist says, "it's an accounting problem that does need to be solved because it can help hide other underlying issues." It's helping hide the very real (but much smaller) amounts of money that the Pentagon wastes every year. But it's also being falsely used for a broader purpose — to legitimize implausible conspiracy theories like 9/11 controlled demolitions or even chemtrails. If the Government can steal trillions of dollars from us (the argument goes) who knows what else they would do, especially now they can afford it?

    But nobody stole trillions of dollars, it's impossible, and it's just adding up a bunch of accounting. It's accounting that's difficult to follow. So unfortunately, because of this difficulty, this particular myth is going to stick around for a while.

    See also:
    Last edited: May 30, 2018
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  2. Mick West

    Mick West Administrator Staff Member

    Part of the conspiracy aspect of this story is the claim that after Skidmore and Fitts started looking into it, then the files were removed.

    They give the old URL as:
    And the new one as:

    But this just seems to normal web-site restructuring. It's not uncommon for URLs to change after a year or so. And a sequential move makes some sense if they had to manually update links. The best evidence of this is the change in the structure of the URL from a simple "documents" directory, to a more structured one typical of a well designed long term archive with lots of files. The short URL was probably a temporary one - the DoD IG is not going to store all their files in one directory.

    And the file was also available here:
    Last edited: May 25, 2018
  3. Mick West

    Mick West Administrator Staff Member

    A relevant statement from Bruce Anderson, chief of communications for the Office of Legislative Affairs and Communications in the Department of Defense Office of Inspector General, published on Michigan NPR's site:
  4. Mick West

    Mick West Administrator Staff Member

    The term FBWT above means "Fund Balance With Treasury". It represent a kind of checking account that each federal department has with the treasury. The amount "in" the account represents how much of the federal budget that department is authorized to spend.
  5. If I may, the date of the supposed "hiding" has mundane significance too. That's just a few days after the end of the Federal fiscal year. October is a pretty busy month for any office that has significant end of the year reporting, as a most of those materials have to be published in early to mid November. A lot of web site housekeeping transpires in October to make way for the November publication dump.

    Also, the short URL used for a recently published report is entirely consistent with report web postings at a variety of agencies.
  6. Joe Dante

    Joe Dante New Member

    how is this debunked? if one report says they have 500 billion of tanks on hand and another says 800 billion of tanks on hand and someone just adds 300 billion of tanks to the 500 to make the numbers match that very easily could mean 300 billion in tanks were stolen, sold without authorization and money pocketed, not even manufactured but paid for, or a million other things. just saying they needed the numbers to match and the money was already spent anyway doesn't remove the problem or the possibility of theft/wrongdoing.

    So what actually happened is:
    the DoD used "unsupported adjustments" (ie made up numbers) for 600 billion dollars that it claims were because of "faulty software" or "user entries done to match discepencies in the totals" and it entered totals multiple times on its accounting books but left footnotes explaining these were double? triple? entries that occurred because the number at the start of the accounting year was incorrect and they had to just put something there?

    This seems irresponsible to just grab someone who exaggerated the claim and depict it as debunked because they responded with a report but with no documentation or actual proof of claims. is the actual 63-page report, released July 26 at the direction of Principal Deputy Inspector General Glenn A. Fine debunked? in it he claims:
    is there some proof these claims are wrong? or are we just supposed to take their response at face value? is this debunked: "DoD makes unsupported adjustments totalling 600 billion dollars" ?
    Last edited by a moderator: Jul 22, 2018
  7. Mick West

    Mick West Administrator Staff Member

    You seem to be confusing figures. $600 Billion was the DoD budget in 2015. The amount of unsupported adjustments was $6,500 Billion ($6.5 Trillion) for that year.

    So I think you need to be more specific. Please check the top post again, and read and/or listen to what Norquist is saying.
  8. Shen Dao

    Shen Dao New Member

    There are two articles published by Forbes in regards to the matter of the missing $21 trillion. The first article was published by Forbes on December 8th, 2017. This first article (December 2017) is indeed linked to the original post. But there is a second follow-up article regarding this same matter published by Forbes on July 21st, 2018. This second and most recent Forbes article (July 21, 2018) is a direct rebuttal to the original post and it deserves a place in this thread.

    The whole article is worth reading, and raises a many interesting points, but here are two key excerpts directly arguing against Norquist video.

    The first excerpt from the article says:

    The second relevant excerpt from the article says:

    Here is the link:
  9. Shen Dao

    Shen Dao New Member

    In Mr West's comment, he demonstrates that documents from pre-2017 were available elsewhere, so the original conspiracy argument loses some of its steam. However, now, the most recent published data by the Department of Defense (fiscal year 2017) has been released with all the relevant information redacted. I believe this re-opens the conspiracy debate.

    Here are two excerpts from Professor Mark Skidmore's update (June 2018) on the unresolved issue of the $21 trillion in unsupported adjustments:

    The first excerpt:
    The second excerpt:
    And here is the link to Professor Skidmore's post:
  10. Mick West

    Mick West Administrator Staff Member

    Can you post examples of these redactions please.
  11. Shen Dao

    Shen Dao New Member

    Here is the link to the document that Dr Skidmore is referring to:

    Here is an example of the redaction, from the key section, labeled "Findings" (on page 3):
    In your original post above, the 2016 version of this report is linked. The 2016 document is not redacted. Here is how the key finding of the 2016 report (stated on page 3) appears:
    Dr Skidmore started out as a skeptic about the missing money, as he states in the video linked to your original post. At 4:05 to 4:25 of this video he states:
    On the website for the Department of Defense, Office of Inspector General, there is a statement (dated May 18, 2017) which says:
    This, by the way, is only included because it comes from a link sent to me by one of this site's administrators in response to a post that was refused:
    But this link you sent is from 2017 and predates the redacted report and everything else in this thread, so i am not sure how it is relevant.

    Let me briefly summarize my own position and my reasons for posting: I value this Metabunk community and the clarity and level-headedness that everyone brings. I am hoping to read some well-considered and logical comments about this missing money. But until there is a reasonable explanation, especially one which can satisfy experts like Dr Skidmore, then i believe it is premature to label this thread "Debunked".
  12. deirdre

    deirdre Moderator Staff Member

    your audit is examining fiscal year 2017.

    the "FY" in both those documents means "Fiscal Year"

    none of your redactions indicate a money amount is redacted as is claimed. [Agency] Identification information is redacted as per the Privacy Act.

    I sent you the program proposal because it shows the audit title in full.

    It looks like money amounts were excluded from the text, but a quick scan didn't show me anywhere that "numbers" were redacted. Your example is redacting an agency or company name, not numbers.
  13. Shen Dao

    Shen Dao New Member

    According to Merriam-Webster Dictionary, redacted means:
  14. deirdre

    deirdre Moderator Staff Member

    so? what is your point?

    Your example that allegedly supports the claim (*bold text is yours)

    I'm going to use "Department of Homeland Security" in my example. But only because I know the acronym for DHS off the top of my head.

    which of these two paragraphs sounds normal?

    1. (U/DHS) Adjustments made to the Department of Homeland Security data during the FY 2017 financial statement compilation process were not adequately documented and supported in accordance with the DoD FMR. This occurred because the DHS JV standard operating procedures did not include specific instructions tied to the DoD FMR. Until the DHS consistently follows the DoD FMR to maintain fully documented JVs, the Navy's financial statements will remain unsupported and will be potentially misstated.

    2. 2.8 trillion Adjustments made to the 2.8 trillion data during the FY 2017 financial statement compilation process were not adequately documented and supported in accordance with the DoD FMR. This occurred because the 2.8 trillion JV standard operating procedures did not include specific instructions tied to the DoD FMR. Until the 2.8 trillion consistently follows the DoD FMR to maintain fully documented JVs, the Navy's financial statements will remain unsupported and will be potentially misstated.

    I fear your queries might be going a bit too off topic, what does crappy accounting procedures (that the audit review was investigating) have to do with the claim (thread topic) that trillions of dollars are MISSING?

  15. Shen Dao

    Shen Dao New Member

    Yes, this is getting a little off topic. How about we get back to my posts above, which are simply trying to point out that the expert here is Dr Skidmore (certainly not me) and he summarizes this whole dilemma in his most recent post (June 2018) as follows:

    Here is the link to Dr Skidmore's post:
  16. deirdre

    deirdre Moderator Staff Member

    can you give an example of a number being redacted?
  17. Shen Dao

    Shen Dao New Member

    I thought we were going to get back on topic? :confused:
    Where is the explanation for the money from the 2016 document? Why hasn't the 2016 money been properly accounted for? Why is the OIG refusing to discuss the matter? These are the questions that should be addressed.

    What is the Metabunk community response to the rest of Dr Skidmore's three notable developments (see my previous post)?
  18. deirdre

    deirdre Moderator Staff Member

    Everyone, including Nordquist, has conceded that the poor accounting procedures are a problem and need to be resolved. Hence the audit reviews.

    I imagine it is going to take a while for the accounts to get squared away.

    As far as why the 2016 released Army General fund audit report has no redactions and doesn't say "Secret" on the document, and why the 'new' 2018 released Navy audit does say "Secret" and has redactions... I don't personally know. But a FOIA request can be made for the Navy audit and if it comes with redactions then that decision can be appealed. Technically when things are redacted they should have little numbers on the redactions indicating the exemption law used to warrant each redaction.
  19. Mick West

    Mick West Administrator Staff Member

    The rest of them? There's nothing there. #1 and #3 just say Skidmore has not yet figured out what is going on, and has been unable to get more info from the OIG. And #2 claims without supporting evidence or examples that " all numbers and figures referring to unsupported adjustments have been redacted"

    I suspect that if there are figures missing, then they have probably decided to no longer give figures like the sum of all unsupported transactions precisely because of the likelihood of misinterpretation of it as money that is "missing".

    The basic point still stands here. It's not missing money. It's bad accounting practices. It may well help hide some some missing money from inefficiencies, fraud, and even extra-governmental operations, but there's nothing at all to indicate trillions of dollars going missing every year.
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  20. Nephre

    Nephre New Member


    What these authors are leaving out of the tale is that the military receives far more than the published amounts of money officially allocated to their basic budget.

    [... off topic material removed]
    Last edited by a moderator: Nov 13, 2018
  21. Mick West

    Mick West Administrator Staff Member

    Can you document this? With figures?
  22. Mick West

    Mick West Administrator Staff Member

    In this case, it's after a liability has been incurred - i.e. the money has essentially been spent, just not delivered to the contractor. Here the unsupported adjustment would be in something like the total of contract accounts payable for one department.
  23. Clayton Rodriguez

    Clayton Rodriguez New Member

    Is this really debunked? There are legitimate articles coming out that the DoD is failing independent audits:
    Source: Exclusive: The Pentagon’s Massive Accounting Fraud Exposed
  24. Mick West

    Mick West Administrator Staff Member

    It's the same story, based on Skidmore's work, which does not actually show missing money, just these same adjustments to records of money that is already spent. (i.e. things like the value of the Navy's ships).

    Again, it's literally impossible to lose ten times as much money as you have.
  25. Clayton Rodriguez

    Clayton Rodriguez New Member

    I wouldn't say this is necessarily the same story, it appears that this subject has hovered around losing $21 trillion when the actual story is that of course $21 trillion isn't actually missing but that the DoD has been making up numbers to Congress. These imaginary figures have made up the figurative $21 trillion. In reality, it seems that they've been doing this to cover whatever spending habits have actually been occurring. Doesn't it seem a bit odd that even after Skidmore's report, independent investigations have been done and they still have failed to come even close to an actual number? Without trying to make this into an actual crazy conspiracy theory that might've been suggested by Lee Camp. It seems quite possible that there is actually fraud happening in the DoD.
  26. Mick West

    Mick West Administrator Staff Member

    Of course there is. It's like the largest organization in the world. There inevitably will be some corruption, and probably totally in the billions over time.

    But the claim here is that TRILLIONS are missing. That is not supported by the evidence.

    And there are no "independent investigations" that I'm aware of, unless you mean the attempted audit.
  27. Clayton Rodriguez

    Clayton Rodriguez New Member

    Point taken, I don't know if I'd agree that there would "inevitably" be some corruption (almost as if we should accept that) but I don't see any accounts for there being Trillions missing outside of hearsay. I've been trying to get in contact with David Degraw who claimed to have come up with those numbers as well. Yes, the attempted audit you might be referring to is apart of the independent audit. Although this might be debunked, I still feel that it's still very serious whether there are trillions, billions, or even just millions missing that it's important that people take these matters seriously.
  28. Mick West

    Mick West Administrator Staff Member

    I certainly don't think we should accept corruption — I just think it's something that historically has been shown to happen in any very large organization.

    There's probably a lot more waste than losses from corruption.
  29. Josh Callman

    Josh Callman New Member

    Interesting discussion. Here is a link to Kotlikoff's latest article in Forbes:

    Holding U.S. Treasurys? Beware: Uncle Sam Can't Account For $21 Trillion

    According to Kotlikoff:
  30. Z.W. Wolf

    Z.W. Wolf Senior Member

    I don't see the need for an elaborate explanation. People are only going to work as hard as they have to. The military doesn't need to establish and follow good accounting practices, so it hasn't.
  31. Mrantala

    Mrantala New Member

    I'm sure someone else in this thread has already expressed this same opinion, but if not here you go.

    First of all, it always amazes me when the government just can't seem to find a way to correctly account for larger sums of money... such as millions, billions, and yes.. over years... trillions of dollars. However, when I filed my 2014 Federal tax returns, and I was off by $150.00.... they certainly were able to correct me, and tell me that I was actually off by $150... AND 43 CENTS. Wow... they certainly have there accounting systems tied together then. Maybe this year for 2019, could I have Pentagon do my Federal Returns ...?

    Everybody... it's a shell game that their playing. And when they say an "Audit"... it's not an audit, and another shuffle of the shells and make us go another year guessing.

    And of course it's in the Trillions of Dollars. You can't fund secret government projects (and no I'm no going to conspiracy right now) such as advanced weapon developments, new aircraft/spacecrafts designs, etc with PUBLIC funds. If you do that, you have disclose what they are and how much their costing, and they don't want to do that. When SpaceX is putting into orbit a "secret and undisclosed payload" - who do you think is paying for that, and where do you think the money is coming from ? They're no paying Monopoly Money !!

    Either way, the American people who are stuck in the middle class are getting squeezed harder and harder until their backs break. It's not going to get any better. Look at the example of the douche we have in the White House now. I don't think he's setting an example of being true and open disclosure when it comes to money, is he ?
  32. They can do that, they do it, and they don't have to disclose it.

    Fold them up into vaguely named budget lines that just say things like "other procurement" without any elaboration or exist as code names with perfunctory descriptions. There's also two versions of the budget: the declassified one that you can get from any .gov and the classified ones that the White House submits and Congress approves behind closed doors where there are break-outs for the classified work. And not everyone in Congress gets to see that one either.

    None of this is speculative or conspiratorial. They do exist and there was a minor flap in 1990 when Aviation Week discovered a budget a few years earlier had inadvertently included an actual break-out for something that we now generally accept to have been the B-2 Spirit* when it was lurking in the black budget between 1979 and 1989. It had spent those years under the vague and ambiguous line of "Other Production Charges" in the Aircraft Procurement numbers. That code means something, as the Navy (for instance) has the same line. However, at the time, they had a budget of just $50 million while the Air Force was at $3.5 billion. The Navy, I would wager, would be much more forthright in telling you what they were doing. The Air Force might have said something similar to what the Navy says, but their numbers are a gigantic one that seems wildly out of place compared to what the Navy said. There's a big old lump of black project sitting right out in the open. But the error with the roll-up only happens in one budget in that decade. Simple math over the period from 1979 to 1989, even without the error, would have told you they were paying for something expensive that hadn't seen the light of day.

    Another example is no one knows (I mean someone does) what the heck the NRO is spending all its money on. They're buying something and generally we can believe some of it goes towards satellites. What they are and how much they cost is another thing. So when they show up at NASA saying "hey you guys want these optics from project that failed? You could use them for more telescopes." and NASA looks at literally billions of dollars in hardware that got thrown in the trash, more or less, it is entirely consistent with how much the NRO gets and what their mission is. But virtually no one knew they had all this stuff laying around.

    * I say generally accept because the Advanced Tactical Bomber (the B-2), Senior Trend (the F-117), and the Advanced Tactical Fighter (the F-22) were all black projects at the time. The peak and decline of funding in the Other Production Charges item and the transition into the declassified B-2 funding implies it was a single aircraft type.
  33. Cantonear1968

    Cantonear1968 New Member

    Debunked: Missing $21 Trillion / $6.5 Trillion / $2.3 Trillion - Journal Vouchers

    Just to add this here as an FYI because it's a claim that I've only recently started to see. By recent I mean probably within the last year. The claim going around now is that the Pentagon was specifically targeted where it was because the people working in this office were working on "finding" the "missing" money. I believe it's well established that the impact zone of the Pentagon was at least one of their accounting offices, but I've seen nothing to establish that this particular one was working specifically on this case. Or the ridiculous notion that the Pentagon keeps its 50 year budget on a few desktops in one office (for bonus CT points they claim that WTC7 was the off-site back up, which is why it had to be destroyed).

    This thread well establishes the ongoing work to correlate the "missing" funds so just a bold assertion with no backing evidence.
  34. MikeG

    MikeG Senior Member

    Rolling Stone.
    Rolling Stone
    reporter Matt Taibbi published a very good examination of Pentagon finances.

    • Informative Informative x 1