The government is rushing to spend billions. Here's why
During the past month, several federal agencies have spent tens of millions of dollars on items such as passenger cars, movie cameras and raw silver and gold.
The reason is that unspent funds expire at the end of the fiscal year — Sept. 31 — which is prompting these agencies to rush to spend their money to ensure they don’t lose it before the cash is returned to the Treasury.
According to the National Bureau of Economic Research, federal agencies spend, on average, 4.9 times more in the last week of the fiscal year than in a typical week during the remainder of the year. In 2018, for instance, federal agencies spent a staggering $97 billion in September alone, a 16 percent increase from fiscal year 2017 and a 39 percent increase from fiscal year 2015. And in the final seven days of the month, federal agencies spent $53 billion, which is more than they spent in the entire month of August.
So far this year, the State Department has dropped more than $33 million on passenger cars, and the Justice Department spent $3 million on movie cameras. The U.S. Mint, meanwhile, has spent more than $60 million on raw gold and silver, according to The Washington Times.
Sen. Joni Ernst criticized the spending this week, slamming the “use-it-or-lose-it” spree underway in Washington. The Iowa Republican introduced a bill earlier in the year to stop the mass spending in September by removing incentives for federal agencies to spend that money.
“‘Tis the season in Washington,” Ernst said in a speech on the Senate floor last week. “Government agencies are going on their annual ‘Christmas in September, use-it or lose-it’ shopping spree. If not spent by midnight on Sept. 30, leftover dollars expire and can no longer be used.”
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The jump in spending comes as the U.S. national debt nears $23 trillion, the highest it's ever been, thanks to a decline in tax revenue and a rise in federal spending.
According to the Congressional Budget Office, the United States is expected to continue racking up annual deficits not seen since the 1940s, even in the midst of a record-long economic expansion.
"Washington should be looking for ways to save by canceling or delaying unnecessary expenses, rather than splurging on year of the end wish lists," Ernst said.