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What if you lost a whole lot of money? Can you imagine the horror and desperation you’d feel? Well, the US government has lost $21 trillion, and they don’t seem to care. But the rest of us have to care about our own budgets.
Planning to save money is at the top of Statista’s list of 2024 New Year’s Resolutions. In the past, resolutions like losing weight and eating healthy foods have been more popular, but times are changing.
The inflation that’s making average Americans so miserable right now was preventable. Many of us knew, once the Federal Reserve started printing money during Covid that at some point, we would all have to pay. And now those bills are now coming due. While the situation reveals terrible leadership at the top of American society, the Americans attempting to improve their financial literacy deserve commendation. (If you are trying to live more frugally, check out our sister site, The Frugalite. and Daisy’s book, The Ultimate Guide to Frugal Living.)
But what about our political class?
Are the Americans responsible for the money flow at the national level trying to get their financial house in order, too?
It looks unlikely. As we mentioned in a previous article, Congress hasn’t passed a budget with no government shutdowns and no continuing resolutions since 1997,
Think about what you were doing in 1997. I was in high school. That was a generation ago. We’ve had a full generation of a Congress that cannot get its financial house in order. And worse, almost no Congressional members pretend to try.
Is this incompetence? I’m sure a lot of it is. Yet the problems are too deep to blame solely on that.
For example, the government “lost” $21 trillion recently.
In 2018, Michigan State University Economics Professor Mark Skidmore and former assistant secretary of Housing and Urban Development (HUD) Catherine Austin Fitts issued a report showing that, after combing through official databases of government budgets, there was $21 trillion unaccounted for.
Mainstream sources were quick to point out that the Pentagon has never had $21 trillion to spend. That ridiculously huge figure probably came from sums of money being accidentally double- and triple-counted.
However, the enormous sum of missing money did spark the Pentagon’s first-ever audit in 2018. Congress had required every department to audit itself since 1990, but the Pentagon, 28 years after the fact, was the last department to get around to it. And they did not pass it. In fact, in 2023, the Pentagon failed its sixth audit in a row.
Politicians such as Alexandra Ocasio-Cortez have focused on the Pentagon misplacing $21 trillion, but that’s not fair. As Professor Skidmore and Austin Fitts have repeatedly pointed out in a variety of articles and interviews, some of that $21 trillion also came from HUD.
Furthermore, just because those departments had sums of money earmarked for them doesn’t mean anyone in those departments actually handled it. Skidmore and Austin Fitts have repeatedly referred to this as a federal government problem, not just a Pentagon or HUD problem.
Austin Fitts would know. George Bush appointed her as the assistant secretary of HUD in 1989. Austin Fitts had been a successful investment banker, the first female Managing Director in Dillon Read’s 150-year history. After becoming Bush’s assistant HUD secretary, she took on the responsibility of cleaning up an agency losing $11 million a day, mostly due to fraud.
There are two sets of books.
After Skidmore and Austin Fitts’ report went public in 2018, the response of the Federal Accounting Statement Advisory Board was not to insist on further transparency, as described by Professor Skidmore to James Corbett in his interview. Instead, the Federal Accounting Statement Advisory Board recommended allowing a small group of people to rewrite the balance sheets to allocate money as needed for national security.
What this means is that there are two sets of books. One, the information available to the public is only loosely connected with real transactions.
The second set of books, the real one, is kept by that small number of people who determine what is relevant to national security and funnel money where they see fit.
In case this sounds far-fetched, I encourage you to explore the “Missing Money” videos on Solari.com. There is a short 5:30-minute summary here or an in-depth hour-and-a-half-long video here. Austin Fitts has been extensively documenting this issue since 2000.
What’s missing ($21 trillion) is almost as much as the national debt.
$21 trillion is a staggering sum of money, almost as much as the official national debt. How and why would it disappear?
Via Austin Fitts’ Solari Report, there appear to be at least five possibilities:
- The missing money was spent appropriately, but the existing accounting infrastructure is incapable of tracking it.
- The money was “wasted,” i.e., spent unwisely.
- The money was directed into black projects and Special Access Programs in massive amounts outside the Constitutional appropriations, and therefore, without the knowledge of Congress and the citizenry, for purposes unknown.
- The money was used to manipulate markets to maintain the reserve status of the dollar.
- The money is being stolen by fraud and collusion between government and private interests.
Gauging which of these is most likely far outside my pay grade. I’m just an average woman who has spent most of her life on a shoestring budget.
And that’s the real issue.
The average American cannot print herself money. If an average citizen feels that she has to purchase a gun because of increasing crime in her neighborhood, that means forgoing some other item she could have spent that home defense money on. No one gets everything all at once. Making those judgment calls is part of being an adult, and the Founding Fathers understood that.
In fact, it’s written in the Constitution. Article 1, Section 9, Clause 7 states that:
No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law; and a regular Account of the Receipts and Expenditures of all public Money shall be published from time to time.
The lack of financial accountability within the federal government is more than an embarrassment. It’s a reflection of how far the federal government has removed itself from the principles of the Founding Fathers.
Does this mean the Constitution should change?
What of the belief that we’re two and a half centuries past the time of the Founding Fathers and that the Constitution needs to change with the times?
First, morality doesn’t change, and the Founding Fathers understood that. They knew that any society needs a set of cultural norms to function. John Adams famously said, “Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.”
Most religions have had admonitions against lying and stealing. In C.S. Lewis’s classic short work The Abolition of Man, his Appendix “Illustrations of the Tao” cites dozens of examples from a variety of ancient cultures going back almost four thousand years regarding the importance of honesty and forthrightness.
Second, if we Americans do not stick to the principles of the Constitution, what do we have? We’re a diverse nation, not united by race or religion. Up until fairly recently, what united us was our pride in and love of the Constitution.
If it feels like society is coming apart, it is. Much of this has to do with the fact that we are governed by people who think the limitations set forth in the Constitution no longer apply to them.
We can only control our own accountability.
Most of us can’t control the total lack of accountability within the federal government. We only have limited control over our own finances. But that shouldn’t stop us from doing what we can to improve our situation.
If you’re one of those people whose New Year’s resolution is to save money, I salute you. I am doing the same. Let us bear in mind that true generational wealth comes in more forms than dollars. It comes in commodities, skills, and, above all, trusted networks of family and friends.
What are your thoughts? What do you think happened to the missing $21 trillion? What do you think it would take to make the government financially accountable? Are you working on your finances in 2024? Do you have any financial New Year’s Resolutions?
Let’s discuss it in the comments section.
About Marie Hawthorne
A lover of novels and cultivator of superb apple pie recipes, Marie spends her free time writing about the world around her.