Everyone the Tres Reyes Hotel has a lot of memories for me. Exactly 25 years ago I was here with a woman from South Africa named Elsje Johanna Prasch. We had a wonderful time and the relationship did not work out. I had a broken heart for a while. In life it is so hard o find a good partner I had to wait 10 years after Elsje and I were here to find my wonderful partner in life-Elena.
Yesterday was my last day in Rio De Janeiro. I’m a lover of and collector of Brasilian music. I found an incredible shop called (ironically) Bossa Nova. I got some incredible new music. I relaxed on the beach and then had to leave to fly first to Sao Paulo. (The international terminal is incredible, by the way). I flew to Buenos Aires. That airport was disorganized. After clearing customs and immigration, I hired an excellent ramiss (upscale taxi driver) named Jose G. Arenas. As we left the airport, we got on the highway going to downtown Buenos Aires. We road was clogged with traffic and not moving. We first thought that a major traffic accident had happened. Closer observation showed that the main highway was closed off due to bon fires being set to shut down the highway. This was done by protestors unhappy with the Argentina economy and government. My driver was a very competent and honest man. He took me around all sorts of back roads with police cars everywhere with their lights flashing. Things were tense. I made it to the Hilton Hotel in Puerto Madero. I got checked in. I went downstairs to have dinner. It was a surreal feeling in the dining room. I felt like some British person dining at Raffles Hotel in Singapore in late 1941 or early 1942. I was having great food and wine. I was listening to beautiful music. Not faraway were some 140,000 Japanese soldiers who soon would end the privileged colonial life of the English there.
Fraudulent Medicare, Medicaid, EITC, Tax Refunds, etc. Total $1 Trillion Since 2003
A huge chunk of your tax dollars every year goes straight into the pockets of crooks. Nearly one in three earned income credits (EIC) is fraudulent. And the numbers keep getting bigger every year according to the Government Accountability Office.
Please consider GAO: Feds Made Nearly $1 Trillion in Overpayments Since Fiscal 2003.
Government waste took a significant turn for the worse in fiscal 2014, rising dramatically to $124.7 billion from $105.8 billion in fiscal 2013.
Since fiscal 2003, “cumulative improper payment estimates have totaled almost $1 trillion,” the Government Accountability Office (GAO) said in a new report.
U.S. Comptroller General Gene Dodaro testified Thursday on the GAO’s new findings (http://www.gao.gov/products/GAO-16-92T) before the Senate Finance Committee.
The GAO said three programs were most at fault: Medicare, Medicaid and the Earned Income Tax Credit (EITC).
The Earned Income Tax Credit program was the worst offender.
The Internal Revenue Service estimated that the program erroneously handed out $17.7 billion worth of “improper” payments. That amounts to a whopping 27.2 percent of the total $65.2 billion in EITC refund checks that the IRS sent out in fiscal 2014.
Medicare was nearly as bad. The program, which covers about 54 million elderly and disabled beneficiaries, incorrectly doled out $59.9 billion in fiscal 2014, which is about a tenth of its $603 billion budget.
So, one out of every $10 that Medicare spent last year was erroneous, the GAO found. Medicaid made $17.5 billion in mistaken payments out of its $304 billion budget, for a nearly 6 percent error rate.
Besides the EITC program, the federal programs with the highest reported error rates for fiscal 2014 included the School Breakfast program (25.6 percent) and the Farm Security and Rural Investment Act Programs (23.1 percent).
The GAO Report is called Addressing Improper Payments and the Tax Gap Would Improve the Government’s Fiscal Position
Inquiring minds may wish to take a look.
Correct Term is Fraud
Writer Elizabeth MacDonald labeled this as “Overpayments” or “Waste”. The GAO labels this as “improper payments”.
Let’s be more accurate, it’s theft of taxpayer money via fraud.
Moreover the GAO numbers are dramatically understated. Disability fraud, not part of the GAO report, is rampant.
States’ Incentive to Promote Disability Fraud: States Have an Incentive to Promote (Not Stop) Disability Fraud; So How Much Fraud Is There?
14 Million on Disability: Unwilling to Work; 25% in Hale County AL Collect Disability, 14 Million Nationwide; A Simple Solution
Why Work?: Why Work for $7.25 When Welfare Pays $15.00 in 12 States and $8.00 in 33 States? Is a Low Minimum Wage the Problem?
Puerto Rico Fraud: Puerto Ricans Get U.S. Disability Benefits for Inability to Speak English; Disability Deal Explained
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Clinton Ends Welfare “As We Know It”
Want to understand the huge spread in disability fraud? Look no further than Bill Clinton as explained in detail in link #1.
This all goes back to 1996 when president Clinton promised to “end welfare as we know it”. Clinton did indeed do just that, and fraud is the result.
The federal government pays disability, but states pay part of welfare costs. This creates a huge incentive for states to actively promote disability fraud (simply to get people off state-sponsored welfare programs).
And that they have done. A primary example pertains to Hale County (see link #2).
25% of the people in Hale County Alabama collect disability. They are all tied to Hale county’s Dr. Timberlake.
Dr. Timberlake asks a simple question to all his patients. “What grade did you finish?” If you claim “back pain” and do not have a degree, Timberlake believes you are disabled.
The GAO says “Old Age, Survivors, and Disability Insurance” claims are only 0.4% improper. Taking the above into consideration I would be shocked if the real percentage is under 33%. Indeed, 67% fraud is probably more like it.
And if so, what’s the real dollar total?
Mike “Mish” Shedlock
BitGold: Open Your Account Today!
Fraudulent Medicare, Medicaid, EITC, Tax Refunds, etc. Total $1 Trillion Since 2003
Posted by Michael Shedlock at 2:49 PM
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Oct 04 at 2:49 PM Fraudulent Medicare, Medicaid, EITC, Tax Refunds, etc. Total $1 Trillion Since 2003
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ABOUT MIKE SHEDLOCK
Mike “Mish” Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Continue reading…
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16 years ago it was a cool and a dark fall morning in the Willow Glen section of San Jose. I got up at 5:30 in the morning and dressed out. I was broke and barely paying rent. Both of my Triumph TR-7’s were broken down and in the shop. My bicycle even had a flat tire. On my first day at work at Telewave, Inc. I was going to have to walk to work. I was thrilled at my starting salary of $38,000 per year. It seemed like a fortune. I left my apartment and walked several blocks to San Jose Diridon Station. I boarded a train heading for San Francisco. I got off at the Mountain View, California station. I walked several blocks in the dark to the two-building complex of Telewave, Inc. I reported to my new boss Bill. Like any company, I had to fill out a lot of paper work. I was taken to my desk and introduced to my co-workers including Dave Ramirez, Caje Remedios, Bob Fall, Clif Fraser, Bill Kubicki, Aces Dulos, Carlos Mendez, and Tom Chu. My first day was dull and uneventful. At the end of the shift at 3:30 PM, I walked back to the train station and took the train back to San Jose and walked to my apartment.
Eight years ago on this day in 2007, it was my last day at Telewave, Inc. Over those years I had sold some $13 million in telecommunications products all over the world. My only write-off had been $4,400. I had married Elena. We owned two houses and two nice cars. We were headed for a great retirement. My life had taken a dramatic change for the better. I was better off financially and had so much faith in myself because of what I had accomplished.
Telewave is still in business today as it has been since August 8, 1972. The job that I started that day 16 years ago made all of the difference in the world in my life. It was “the hand up” that I needed to get out of poverty.
There is an object lesson here. One job, regardless of how humble, can make all of the difference in the world in someone’s life.
The month of October begins. Elena has the day off and is sleeping late. The house is quiet. I think back 27 years ago to 1988. I was employed by the non-profit Mary Lind Foundation in Los Angeles. This is a wonderful alcohol and drug treatment program with residential facilities for recovering alcoholics and drug addicts. The head of all physical education programs was a very tall and funny man originally from Chicago. His name was John Webb. At 10:00 each week day morning he would lead residents at one treatment center or another in an hour of physical exercise. He always began the workout with the following words: “I had a good night last night. Think about all of the people who did not wake up this morning.”
Each morning that I awaken and see beautiful Elena next to me I think of his words. I give thanks to God for one more day of life with hope.