Senator reports catalogues unnecessary spending
Facebook, the hot technology company that is earning more than $1 billion in revenue, won’t pay any taxes on its income this year and instead probably will get a major refund from federal taxpayers, according to Sen. Tom Coburn’s annual roundup of wasteful spending.
Among the nearly $30 billion of unnecessary spending that the Oklahoma Republican identified in this year’s “Wastebook” were taxpayer dollars going to buy human urine, to purchase crystal goblets at the State Department, and to pay $18,000 apiece to “pillownauts” — people whom NASA recruited to lie on a bed for two straight months.
The book was released Tuesday morning, minutes before Mr. Coburn and fellow senators took a key test vote on a budget agreement that will boost spending in 2014, going back on a 2011 deal that was supposed to limit discretionary spending to less than $1 trillion.
“This report speaks volumes about why the American people have lost confidence in government,” Mr. Coburn said. “The truth is, is we’d much rather borrow money than cut spending. That’s the truth. And the American people have a right to expect much more from us than that.”
His 177-page, meticulously footnoted report contains dozens of projects he said showed “stupid” judgment on the part of the bureaucrats who authorized them, and the members of Congress who let the spending continue without reining it in.
This year, with both a spending-related government shutdown and a major fight over the automatic budget sequesters, Mr. Coburn said, the wasteful projects should have drawn even more attention from his colleagues.
The waste he identifies ranges from big-ticket items that are perennial problems — such as the $3.5 billion paid to federal employees who have been identified as tax cheats — to the tiny problems, such as the $40,810 the government spent on a Denver museum dedicated to miniature toys and dolls.
In his report, Mr. Coburn points out that Facebook paid no taxes in 2012, despite earning more than $1 billion in pretax profits. Instead, it received a combined $429 billion refund from federal and state tax filings from 2010 and 2011.
The report said Facebook provides stock options as a major form of compensation, which allows it to take big tax deductions, which it used to offset its profits. It still has more than $2 billion in stock option tax deductions it can carry forward to offset future tax liabilities.
“This rollover, in addition to currently outstanding employee stock options, may once again make this year’s tax bill disappear,” Mr. Coburn said in his report. “If Facebook has the same U.S. pretax profit in 2013 as last year ($1.1 billion), the company will be able to zero out their tax bill for the next year.”
Facebook didn’t reply to a message seeking comment Tuesday.
The Defense Department, which has been pleading with Congress to boost its funding and which is getting a major increase in the budget deal, comes in for particular criticism from Mr. Coburn.
“DOD grounded the Air Force Thunderbirds and Navy Blue Angels, yet still spent $631.4 million to construct aircraft they never intended to fly,” he said.
The biggest item was $7 billion in equipment in Afghanistan that the Pentagon says it will destroy rather than bring home or give away, feeling it doesn’t have a use for the materials in the U.S. and doesn’t want to turn them over to allies.
Mr. Coburn also found $10 million spent by the Army National Guard on Superman movie tie-ins, even as plans were being made to cut the strength of the Guard by 8,000 soldiers.