Brief Thoughts on Military Spending and the Department of Defense's First Comprehensive Audit

Defense spending is one of those large and nebulous areas of government spending. The secrecy of many of the Department of Defense's spending, along with other countries' departments of defense, make it easier to hide corruption or inefficient spending practices. This is compounded by the fact that defense spending ranks third on the federal budget, right after Social Security and Medicare. This is bad not only for the taxpayer because millions (and possibly billions) are being poorly spent, but also because a military that is not spending its resources to the best of its ability undermines national security.

Last week, the Pentagon announced that completed its first-ever financial audit. It turns out that the Pentagon by and large failed this $413 million audit. Out of the 21 departments within the Pentagon, only five received a passing grade. Deputy Secretary of Defense Patrick Shanahan said that he was not expecting for the Pentagon to pass. This might sound like a carte blanche for someone who is all for smaller government to rip into the Department of Defense and say, "Of course the DoD was going to fail. It's Big Government at its finest. What else would you expect?"

But let's remember something else: this is the first time they are conducting such an audit, thereby making arguably making it the largest audit in history. It took the more nascent Department of Homeland Security ten years before it got the hang of receiving a passing grade in an audit. More importantly, auditing the Department of Defense was technically part of the National Defense Authorization Act of 2010, but politicians kept making excuses for delaying it. Defense Secretary Jim Mattis took on this behemoth and got it done. Again, given the nature of defense spending, it is significant that this audit took place. Not only is defense spending more transparent, but it means that dollars will less likely be mismanaged, especially when it comes to inventory management. As long as the audit process one is a thorough one and carried out as intended, the failures pointed out in the initial audit are a good thing. It means that there will be less failures in the future, such as when the Air Force spent over $300,000 on 391 specialty mugs.

Ultimately, I see the audit as a step in the right direction for bringing greater accountability to the largest and most powerful military on the planet. As for how that money should be spent, that is another conversation for another time.

For more on defense spending and military budget reform, see analysis from the American Enterprise Institute, Cato Institute, Center for American Progress, Center for Strategic and International Studies, Heritage Foundation.