I understand the headlines and the claims that money is being recaptured at the rate of about $1B a day. Contracts cancelled, grants put on hold and all that. I'm not talking about salaries and benefits for former employees but the recaptured money.

Where's it at?

From what I understand from Sen Paul Ryan, none of this recaptured money has actually been returned back to the US Treasury. It was previously allocated but once it's "recaptured" that only means it's not going to be spent by the recipient or the contracts were cancelled but the money has already been set aside by the Treasury for the intended purpose.

From what I can tell, the money is in limboland and until Congress moves to have the funds returned to the US Treasury, this is a paper win.

Anyone have a different understanding or a better take on where the money is at?

quote:

Originally posted by Flashlightboy:
From what I understand from Sen Paul Ryan...

Uh huh

So much win in so short a time, they don't quite know what to do with it yet?

Call me crazy, but since it was money we didn't already have. It should be nowhere.

Keep going until we don't have a deficit.

quote:

From what I understand from Sen Paul Ryan...

I confused this with Rand Paul for a moment. Paul Ryan is a loser, not so much of the election, but his spiteful "Never-Trump"-ism.

quote:

Originally posted by OttoSig:
Call me crazy, but since it was money we didn't already have. It should be nowhere.

Keep going until we don't have a deficit.

Most of the time, it means going less in debt by cancelling the expenditure.

However, there was one instance where DOGE found the Biden's EPA had moved $20 billion to CitiBank which seems nefarious. The US Attorney's office was instructed to get it back, and the corrupt US Attorney resigned instead.

quote:

Originally posted by Flashlightboy:
From what I can tell, the money is in limboland and until Congress moves to have the funds returned to the US Treasury, this is a paper win.

I'm not sure about the federal level. But at other levels of government, they have mechanisms in place to return previously allocated but unspent funds to the unallocated budget pool (general fund/treasury/whatever) after a specific time period, sometimes quarterly - like with unspent payroll - but more usually at the end of the fiscal year, at which time it's then allocated into the new fiscal year's budget.

It doesn't just sit in an old expired budget line item indefinitely. And it doesn't require separate legislation to return the unspent money, which would only be necessary if they wanted to claw it back immediately rather than waiting for it to be returned to the unallocated general treasury as part of the natural cycle.

But like I said, the feds may very well operate differently. Though if it does work the same way, their fiscal year begins October 1st, so that would be the time when these unspent funds would naturally return to the treasury.

However, as tatortodd pointed out, there may not be any significant amounts of real existing money actually being recaptured... Rather, it may just reducing the amount of additional money the feds would otherwise have to be printing and/or borrowing.

Here’s what I think: it’s similar to company’s budgeting process. When next year’s budget is approved, the finance department doesn’t send the money or write a check to all the other departments’ bank accounts. The accounting department gets every department’s budget numbers and each department has their budget numbers.

During the year, each department can send a check request to accounting payable to whoever against which budget account. The accounting department confirms everything is good then sends a check to the recipient. If the check request doesn’t come then the budget amount remains with the department until the fiscal year is over and everything is reconciled. So the money that was saved has been sitting in the Treasury waiting to be spent. Actually, it’s more like the money that was saved is money that the Treasury doesn’t have to go and borrow.

In the case of clawing back money that was already spent, then that’s actual money in the recipient’s account until it is returned to the Treasury and the department’s budget will show that amount reversed and yet to be spent.

So senator Paul Ryan simply doesn’t know how government accounting and budgeting works. Either that or he’s posturing like Adam Schiff.

My understanding is that DOGE itself only has the authority to audit/investigate, and then report their findings to the President or Congress to remedy the problem.

If it's outright theft or other criminal activity I would think that goes to the Justice Department.

I do think they need to do a better job of communicating how that will work as things move forward. They have been touting their finding all sorts of money wasting spending and corruption, but at some point they need to show how that actually results in tangible results and specifics.

Otherwise they risk being just another over-hyped cure for what ails the country.

We can't easily get funds back from checks/funds that have already been spent. These funds are stopping future expenditures, it's money congress has approved to be allocated to all federal agencies.

They have found programs in agencies such as USAID where congress approved say a billion in funding for 2025, and when auditing USAID, they found earmarks for spending for all those crazy things we read about.

So they reduced allocated distribution of future payments. IF that agency has money in it's bank accounts, that can be recaptured, but for the most part it's stopping future programs from being funded.

quote:

Originally posted by tatortodd:

quote:

Originally posted by OttoSig:
Call me crazy, but since it was money we didn't already have. It should be nowhere.

Keep going until we don't have a deficit.

Most of the time, it means going less in debt by cancelling the expenditure.

Yep. It's money we don't have, but don't have to borrow if it doesn't get spent.

There's no 'surplus' from which to give DOGE dividends to taxpayers. I wish there was.

The best we can do for our country is to reduce spending until we bring revenues and expenditures into balance. We have to get to a balanced budget BEFORE we can begin to address the debt. Right now, we are continuing to add to the debt at an unsustainable pace.

quote:

Originally posted by chellim1:

quote:

Originally posted by tatortodd:

quote:

Originally posted by OttoSig:
Call me crazy, but since it was money we didn't already have. It should be nowhere.

Keep going until we don't have a deficit.

Most of the time, it means going less in debt by cancelling the expenditure.

Yep. It's money we don't have, but don't have to borrow if it doesn't get spent.

There's no 'surplus' from which to give DOGE dividends to taxpayers. I wish there was.

The best we can do for our country is to reduce spending until we bring revenues and expenditures into balance. We have to get to a balanced budget BEFORE we can begin to address the debt. Right now, we are continuing to add to the debt at an unsustainable pace.

This is exactly what I thought. No money has been returned but rather, we've stopped outlays and the need to borrow to cover them.

While all this cutting, cancelling and recouping is nice, and the savings too, the real cost of government is entitlement programs, a touchy subject. How DOGE or Trump plans on dealing with that remains to be seen.

Welcome to the wonderful world of Govt. accounting.

Basically, where money is first "programmed," then "committed," and finally "obligated" by various arms of the Govt. Programmed means allocated to a specific program authorized by Congress, committed means entering into a contract with a vendor, and obligated meaning goods/services received, you may cut a check. One of the primary duties of a Agency's accounting unit (and associated IT staff) to publish a daily or more frequent "PCO report" on the financial status of the agency.

Without knowing the details, I suspect that the money being touted as "saved" is via canceling contractual obligations, i.e. committed funds. Every Govt. contract I have ever seen includes (by reference) a clause that allows the Govt. to "cancel for convenience" leaving a contractor little resort other than suing in the court of claims, a costly and uncertain remedy. Programmed, but uncommitted funds can be recaptured by existing mechanisms, so Agencies are careful to spend (commit) every penny they can.

So there is nothing to claw back, it isn't money that has already been distributed, the "savings" are in not being obliged to spend the money at some point in the future. Like businesses front-loading expenses so as to pay lower taxes this year. In certain circles this is considered deceptive practice.

Any real savings will come when Congress chooses to restrain itself in tossing large bundles of cash (future promises to pay) in just about every direction they can think up (that might garner votes). Having a large "surplus" of uncommitted funds might be considered a reason to not program/budget as much in the future although, historically, this has not been the case.

On a side note, although relevant, I suspect much of the rationale for cancelling commitments is that the objectives of the program were not being addressed by such. E.g. Congress says "help the starving in Africa and other 3rd world countries" and USAID commits to funding contracts that have nothing to do with foodstuffs or farming or other hunger relief measures.

This misinformation is prevalent in commercial language as well, "buy three and save $20.00!" Nowhere is it stated that there's a catch, you have to spend more than you might want so as to save a tiny fraction of that amount.

I believe the problem is the terminology. I am not a finance guy, I was in IT and responsible for significant operational and capital budgets (Telecom at a Fortune 500 company). In terms of budgets and spending, the folks I worked for could teach Elon some things. They were fair but, where budgets were concerned, they were ruthless.

In my world:
Savings - a product or service cost x in 2024, due to a variety of factors, the cost for the same service or product is now x-20%. Lets say a widget cost $1 in 2024 and we negotiated the cost down to .80 cents for 2025. That is a saving of 20% and my budget for widgets would reflect the savings.

Cost Avoidance - this is probably the term that should be used by DOGE. Let's say you have a $10 million contract to install whizbangs in every office in 2025. A new technology makes whizbangs obsolete. The contact is cancelled and the company does not spend $10 million.

Savings and Cost Avoidance do not involve the return of funds already spent so the money stays of the company balance sheet (probably in a new location).

Head count reductions, department eliminations and the like are the same, money is not spent and stays on the balance sheet.

The only way money would be returned is if contracts were prepaid, then cancelled or there was outright fraud that can be proven and a court case orders the payee to return money. DOGE has been working for just over 30 days, I doubt that anyone would return money that quickly. There is a reason it's called a claw back.

quote:

Originally posted by egregore:

quote:

From what I understand from Sen Paul Ryan...

I confused this with Rand Paul for a moment. Paul Ryan is a loser, not so much of the election, but his spiteful "Never-Trump"-ism.

Paul Ryan is not a Senator. I think the quote is from Senator Rand Paul.

As for where’s the money, well no one’s really said have they? I can imagine some of it is on paper only, while some of it may have already been paid out. Some of this is contracts that have been canceled, so there very well maybe some of the ‘recaptured’ funds will get paid out as penalties for canceling contracts. Since it’s only been 30-ish days, it doesn’t seem likely that the Treasury has seen a penny of it yet.

Good question, where is it? Anyone can run around saying....Well, we saved 10 million dollars here. But did you actually stop a payment? If so, show proof!! Show a briefcase full of cash. Keep in mind, these things also existed 8 years ago too.

quote:

Originally posted by jbcummings:

quote:

Originally posted by egregore:

quote:

From what I understand from Sen Paul Ryan...

I confused this with Rand Paul for a moment. Paul Ryan is a loser, not so much of the election, but his spiteful "Never-Trump"-ism.

Paul Ryan is not a Senator. I think the quote is from Senator Rand Paul.

As for where’s the money, well no one’s really said have they? I can imagine some of it is on paper only, while some of it may have already been paid out. Some of this is contracts that have been canceled, so there very well maybe some of the ‘recaptured’ funds will get paid out as penalties for canceling contracts. Since it’s only been 30-ish days, it doesn’t seem likely that the Treasury has seen a penny of it yet.

My mistake. I mean Rand Paul and not the former POS Speaker Paul Ryan.

quote:

While all this cutting, cancelling and recouping is nice, and the savings too, the real cost of government is entitlement programs, a touchy subject. How DOGE or Trump plans on dealing with that remains to be seen.

Whatever "DOGE" saves... Congress will over/needlessly spend twice as much. We're still broke... and until further notice, still broken.

To be fair to Speaker Mike Johnson, it could be worse.

House Republicans were finally able to pass Speaker Mike Johnson's (R-LA) budget bill Tuesday evening despite a mid-day revolt from conservative hardliners.

“If the Republican plan passes under the rosiest assumptions, which aren’t even true, we’re gonna add $328 billion to the deficit this year, we’re gonna add $295 billion to the deficit the year after that, and $242 billion to the deficit after that, under the rosiest assumptions” Massie warned, adding “Why would I vote for that?”

With the GOP’s razor-thin House majority, Republicans can only afford to lose one of their own votes if Democrats remain united in opposition. That slim margin is making Johnson’s job even tougher as he tries to broker a compromise.

A Balancing Act Between Conservatives and Moderates

For weeks, GOP leadership has been wrangling members from both ends of the ideological spectrum. Conservative hardliners have been pushing for deeper spending cuts, while moderates are concerned about slashes to programs like Medicaid.

Some moderates, however, appear to be coming around. Rep. Juan Ciscomani (R-AZ), who had previously raised concerns, signaled on Tuesday that he was softening his stance. “I’m in a better place [than] where I was yesterday,” he told reporters after meeting with leadership.

https://www.zerohedge.com/poli...l-vote-looms-tonight