The 10 Dumbest Ways the Government Wasted Taxpayer Money This Year

It's back! As someone who greatly enjoys a little bit of humor and zest mixed in with economic figures, I look forward to the release of the Waste Book (link opens PDF), an annual summary of 100 ways the U.S. government is wasting taxpayer money, which is compiled by Oklahoma Sen. Tom Coburn and his political team.

Before you assume that politics are playing into this, let me assure you: I have a completely unbiased approach to pointing out the egregious uses of taxpayer and shareholder dollars, as I've made apparent by my weekly CEO Gaffes series, my year-end worst CEO complication, and by looking at Sen. Coburn's Waste Book in 2011.

This year's version of Waste Book covers 100 purported wastes of taxpayer money totaling north of $18 billion. While this is but a blip compared to a $16 trillion deficit, it's nonetheless a questionable use of your tax dollars.

Therefore, I want to once again highlight 10 of the dumbest ways in which the U.S. government wasted your taxpayer dollars in 2012.

1. There's an app for that 
So many wasteful programs, I hardly know where to begin! How about with $100,000 in prizes offered by the Department of Energy to develop an energy app that would help users track their energy usage in their home. It's a novel idea as our energy resources are finite and the DOE has pushed both consumers and businesses to utilize the available green energy subsidies available to them. However, there's just one slight problem with the DOE contest: Apps that do this already exist -- at least five of them to be exact. Perhaps someone should invest in an app that tracks apps for the DOE?

2. Alms for the rich 
Just because you made $66 billion in net revenue doesn't mean you won't take a handout when one is offered... right PepsiCo. (NYSE: PEP  ) ? According to Coburn's report, Pepsi and Theo Muller Group are teaming up to open a yogurt manufacturing facility at the Genesee Valley Agri-Business Park in New York. Unable to use the supplied municipal water in the yogurt-making process, or the $4.2 billion in cash on its balance sheet, Pepsi gladly accepted slightly more than $1.3 million in funding from the U.S. Department of Agriculture and the Department of Commerce to build a new aquifer-direct water supply system, a new road leading to the plant, and to improve the parks' wastewater capacity.

3. RoboSquirrel 
Researchers at San Diego State University and the University of California Davis spent a portion of a $325,000 National Science Foundation grant to construct a robot squirrel to answer the question of why rattlesnakes rarely attack squirrels that wag their tails. Using a taxidermied squirrel that is housed with other squirrels so as to smell realistic, and coupled with heating wires in its tail and body, researches marched RoboSquirrel into the lion's den, or should I say snakes' garden, and determined that a heated and wagging tail does indeed play into their defense mechanism. According to researchers, RoboSquirrel 2.0 and RoboKangaroo are in the works. As for me, I can't wait for RobotChicken!

4. From arts and crafts to World of Warcraft 
For those of you that thought your grandparents spent the entire day quilting or quietly reading, think again. A research team in North Carolina used $1.2 million from a National Science Foundation grant to study 39 individuals, aged 60 to 77, to see how their cognitive function responded after playing Activision Blizzard's (Nasdaq: ATVI  ) World of Warcraft for two hours every day for two straight weeks. The results showed no improvement for those who tested with high levels of cognitive function prior to the test, however some improvement was noted for those who tested with lower cognitive function. I guess we can tell Eli Lilly (NYSE: LLY  ) to move over as we no longer will be needing solanezumab or any of its other Alzheimer's treatments for further testing as long as we have World of Warcraft.

5. Red planet pâté  
Don't let the small fact that NASA has absolutely no manned fleet at the moment stop you from thinking that it isn't actively spending money on potentially fruitless programs. Take for instance the nearly $1 million spent annually on developing a so-called "Mars menu." In order to stave off food monotony, researchers spend roughly $1 million each year to have test subjects simulate space conditions and rate the food being tested based on taste, their overall health, and the mood it puts them in. The only problem is that the first manned mission to Mars is likely two decades away at the earliest.

6. Because I'm the wiz! 
Let me go on the record as stating that this one amused me the most. Michigan State Police, in an effort to deter drunk drivers from getting behind the wheel of a car, apportioned $10,000 in federal funds to purchase 400 talking urinal cakes from a Maryland-based company called Wizmark. The urinal cakes, when activated by a motion sensor, would encourage users at local bars to consider getting a cab if intoxicated and, of course, remind them to wash their hands! As Sen. Coburn's report points out, for around $100 on Amazon.com (Nasdaq: AMZN  ) Michigan State Police could have acquired breathalyzers that they could have instead passed out to local bar owners instead of the urinal cakes. When will people learn that everything is cheaper on Amazon?

7. Shoot first and ask questions later 
The Missile Defense Agency really, really likes to build things. According to Waste Book, the MDA has not once, but twice, begun the build-out of interceptor missiles without first finishing the research and testing that should have been completed prior to their construction. Not surprisingly, delays, failures, and system upgrades were needed to both generations of missiles, which have cost taxpayers at least $1 billion and caused costs on the project to soar fourfold.

8. Miniature golf yields a maximum confidence boost 
Not to be outdone by RoboSquirrel, researchers at Purdue University in Indiana used part of a $350,000 National Science Foundation grant to examine the benefit golfers might gain if they used their imagination better. Researchers placed 36 participants in front of two different-sized golf holes and used optical illusions to make them appear bigger or smaller than they actually were. The findings showed that those who putted toward the smaller hole but perceived it to be bigger were more successful than those who perceived it to be smaller than its actual size. Shocking...

9. Ship mates? 
It's a great thing that our Navy is manned by some fantastic men and women overseas, because its leaders in Washington aren't making it easy for future generations. In late 2010, the U.S. Navy split what could amount to $37 billion in contracts to build 55 new littoral (near-shore) combat ships between two companies, Lockheed Martin (NYSE: LMT  ) and Austal USA. While the thinking here is that two companies could build these ships twice as fast, they somehow failed to grasp that the defense systems, design, and software used on each ship would be different; meaning that crewmembers can't simply be transferred from one ship to another without being retrained. This "boo-boo" is slated to cost taxpayers a minimum of $148 million.

10. What's the buzz about? 
Let's end on a strong note, like a $939,771 experiment funded by the National Institutes of Health in Michigan and Texas that tested fruit flies to discover that male fruit flies are more attracted to younger female fruit flies than older ones. According to researchers, a hormone that female fruit flies produce wanes over time, which makes male fruit flies less attracted to them despite researchers' countless efforts to test this theory even in the dark. The scary news is that this testing may soon be expanded beyond just fruit flies.

Foolish roundup
Just like last year, these 10 wasteful programs are just a sampling of the 100 listed in his Waste Book report, and doesn't completely cover other wasteful spending and subsidy programs like yesterday's bankruptcy announcement by A123 Systems.

Which wasteful program stands out the most to you? Tell me and your fellow Fools in the comments section below.

Following such an atrocious demonstration of government spending, our premium research report geared toward online savings extraordinaire Amazon.com could be in order. Packed with in-depth and unbiased analysis on the opportunities and threats facing Amazon -- and complete with a year of regular updates -- this report is the tool you need to make smart long-term investing decisions. Click here to get your copy.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. He has a Ph.D in sarcasm. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

The Motley Fool owns shares of PepsiCo, Amazon.com, Lockheed Martin, and has written calls on Activision Blizzard. Motley Fool newsletter services have recommended buying shares of PepsiCo, Amazon.com, and Activision Blizzard, as well as creating a synthetic long position in Activision Blizzard. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (31) | Recommend This Article (35)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 17, 2012, at 3:10 PM, CluckChicken wrote:

    Why is spending $1 million a year on developing better long term food storage a waste? Is it just because NASA is doing the funding for it?

    The total money spent on 8 of the 10 is less then 6 million. I do not feel that all of them are worthy of funding but this lists feels like we are worrying about a dripping faucet while the ship is sinking. We are about buy another 42 tanks for $255 million which will join the more than 2000 tanks sitting unused.

  • Report this Comment On October 17, 2012, at 3:12 PM, TMFUltraLong wrote:

    CluckChkicken,

    This report has more to do with the nature of the waste than the actual dollar figures themselves. As I mentioned, if you peruse the report you'll find more than $18 billion in purported government money-wasting programs.

    TMFUltraLong

  • Report this Comment On October 17, 2012, at 3:57 PM, mdk0611 wrote:

    It's not long term food storage, it's "how different foods affect their mood and health". And this is needed 20 years before a mission is possible?

    And if you look at the full list of 100 it talking about billions.

  • Report this Comment On October 17, 2012, at 4:12 PM, TMFUltraLong wrote:

    mdk0611,

    That's the point. Let's worry about a Mars menu when a mission to Mars is reasonably on our plate.

    I made a funny =)

    TMFUltraLong

  • Report this Comment On October 17, 2012, at 4:39 PM, Mega wrote:

    I don't see these science experiments as wasteful. It seems like you only put them on this list because they are interesting, not dull.

    If you look at history, government funded research can have a great payback.

  • Report this Comment On October 17, 2012, at 4:40 PM, NOTvuffett wrote:

    A man travelling to Mars must have an arugula salad with a low-cal vinaigrette dressing... Michelle told us so, lol.

  • Report this Comment On October 17, 2012, at 4:44 PM, TMFUltraLong wrote:

    MegaShort,

    I had this debate back in April when I looked at Waste Book 2011, and I'm definitely not anti-science. I actually love science!

    However, government-funded science projects are sometimes not the best way to spend taxpayers dollars as the report often suggests.

    TMFUltraLong

  • Report this Comment On October 17, 2012, at 7:58 PM, busterjde wrote:

    $16 trillion in debt, not deficit. $1.1 trillion in deficit. Other than that, great article.

  • Report this Comment On October 17, 2012, at 7:59 PM, ooologist wrote:

    For an organization which promotes education and in particular good research in making decisions this an article that demonstrates a lack of both. It comments about the value of research on the basis of a single source (which has agendas of its own) without attempting to find,read or ask what the investigators are trying to explain and why it is important. This is no better than buying a stock based on the hype of the companies web site.

  • Report this Comment On October 18, 2012, at 11:32 AM, jpanspac wrote:

    Sean,

    I only have a Masters in sarcasm, so you're like a god to me.

  • Report this Comment On October 18, 2012, at 12:01 PM, CluckChicken wrote:

    "However, government-funded science projects are sometimes not the best way to spend taxpayers dollars as the report often suggests."

    Yes that seems to be what the report suggests but it clearly ignores the reality that the majority of scientific research starts with government funding.

  • Report this Comment On October 19, 2012, at 8:38 AM, TMFBlacknGold wrote:

    (*friendly tone*)

    I get the point, and there is certainly a lot of waste out there, but every year this article comes out it seems to bash science, the NSF, and NASA (5 of 10 this year). Science doesn't need to be misinterpreted any more than it already is in a scientifically illiterate society. It's dangerous.

    Besides, I'm sure you could pick a lot of funnier or more wasteful programs out of that $18 billion report.

  • Report this Comment On October 19, 2012, at 9:27 AM, sgt1917 wrote:

    #2 is not "alms for the rich", but rather, you should title it "Obama Trying to Create Jobs" or "Government Meddling in Private Enterprise". If you're Pepsi, why wouldn't you gladly accept money if its handed to you?

    You'll notice that all these examples are the result of liberal / progressive thinking...all the more reasons why we need Conservative leaders.

  • Report this Comment On October 19, 2012, at 9:57 AM, gearoil wrote:

    the first idiot,i mean first lady's vacations on my dime.

  • Report this Comment On October 19, 2012, at 10:05 AM, Darwood11 wrote:

    Waste is an interesting term for this. Is it wasteful if the government does not aggressively pursue fraud? For example, there is evidence that annual Medicare fraud is somewhere between $16 billion and $47 billion. That higher number is from a CBO estimate.

    These are very large numbers, and a when we toss around even larger ones, such as a "trillion" it becomes difficult to grasp the magnitude. Here's a website that is helpful:

    http://www.pagetutor.com/trillion/index.html

  • Report this Comment On October 19, 2012, at 11:20 AM, Canuck2010 wrote:

    Frankly most of these sound like a rush to judgement. There is no investigation about the possible uses of the research outcome. For example, the World of Warcraft research sounds like a very legitimate approach to seeing if certain types of activities could help stave off Alzheimer's, perhaps as an adjunct to pharmaceutical interventions.

    The reason NASA doesn't have a Mars mission planned for 20 years, is that there is a lot of R&D that needs to be done and budgets have been cut, so that R&D, needs to be spread out over 20 years. If you delay that research and cut budgets you'll just push the mission date out further. The psychological health of astronauts on what will probably be an 18-36 month mission will be incredibly important, and certainly food is a factor, so I think this research would need to be done eventually.

  • Report this Comment On October 19, 2012, at 11:53 AM, Ecotone wrote:

    As usual, these lists are long on sensationalism and short on facts and the intent of these studies. Certainly the government wastes money, but perpetuating a list such as this is on the Motley Fool is very disappointing. Perhaps TMF Ultra Long needs to think more carefully before posting what I think is a careless piece.

    Canuck2010 has it right in that the outcomes of research questions aren't outline appropriately in the list. I am very familiar with one of these so-called wastes of taxpayer money (I won't say which one), and what people seem to forget about is the value of basic research. Often before we can apply research knowledge, we need to know how systems work.

    Per

  • Report this Comment On October 19, 2012, at 12:20 PM, TMFDiogenes wrote:

    "The reason NASA doesn't have a Mars mission planned for 20 years, is that there is a lot of R&D that needs to be done and budgets have been cut, so that R&D, needs to be spread out over 20 years. If you delay that research and cut budgets you'll just push the mission date out further."

    Yeah -- there's three big challenges with putting humans on Mars: living conditions in transit, landing, and living conditions on the planet. There's a lot we need to learn about the long-term health effects of a multi-year trip to Mars. Nutrition, along with muscle/bone mass loss and radiation exposure, is a big one.

    If you have 20 years of research to do and you delay research by x years, you delay the mission by another x years.

  • Report this Comment On October 19, 2012, at 12:51 PM, TheDumbMoney2 wrote:

    TMFUltralong,

    As this seventh comment in this thread, yours, indicates, at least half of these are only "waste" if one starts out ideologically opposed to government funding of science. The whole point of fundamental science is you don't know what if any practical applications it will lead to.

    Moreover, if the government only wasted $18 billion of our money this year, as a percentage of our total taxes that is a drop in the bucket. Many companies waste a much higher percentage of their income or earnings, however you want to measure it, just on stupidly-timed share buybacks. So I view this as a largely ideological piece, and not particularly damning, either. This "waste," to the extent it even is waste, constitutes literally about 1/2 of 1% of the federal budget.

    And as to number 9, it is extremely common practice to have two suppliers, and just because Waste Book, which is put out by the highly partisan, highly conservative Senator Coburn -- a fact you should have noted, notes that that this will cost money, that does not mean it was not considered. As is typical of people like him, he is only capable of looking at the now. Whether that cost is waste will only be known years from now, if those boats are needed, production needs to ramped up severely, and one but not both of those companies supplying them is unable to do so. It certainly will not seem like waste if that happens.

    This whole thing is a partisan exercise in pointing to an amount of arbuable "waste" out of a strategic desire to undercut faith in government, and a portion of the strategy of cutting. Either you don't get that, or you're a part of it. If the latter, just be more upfront about it.

    Waste is in the eye of the beholder. Not counted for example in the 2011 Waste Book, is the many more billions we had to spend winding down what was a totally unecessary and idiotic war in Iraq, never mind the hundreds and hundreds of billions we spent there from 2003 -- 2010. All of that is apparently just fine in Senator Coburn's book, but God help us if we spend a couple hundred Gs on a robosquirrel.

    Please.

    DM

  • Report this Comment On October 19, 2012, at 12:52 PM, TheDumbMoney2 wrote:

    Yes, as soon as I wrote that I went back and saw it was put out by Coburn and you noted it in the first paragraph. And yes I feel stupid.

  • Report this Comment On October 19, 2012, at 12:59 PM, actuary99 wrote:

    I find it pretty alarming that an apparently intelligent person would distribute the works of Senator Asshat.

    I'm sure many scientific breakthroughs (aka advancements in quality of living) started as what the author would judge to be a "questionable use of your tax dollars".

    Scientific experiments* are an extremely risky investment where there's not a very good probability of a positive return. But every once in a while you get a 1,000,000,000,000,000-bagger (e.g. penicillin), and the return goes to all of current and future humanity.

    *Conducted for reasons other than patenting & profiting from something.

    This is not a good investment for individuals or even large companies, part because they can't absorb the risk and part because they cannot monopolize the return (unlike something you can patent).

    I'd leave it up to well-educated researchers to determine how useful these experiments are. But I have enough humility to try not to spout off on topics where I don't know what I'm talking about.

    I'm sure it were the 1400's you'd be spouting off about idiotic researchers trying to prove the world is spherical.

  • Report this Comment On October 19, 2012, at 1:32 PM, sheldonross wrote:

    Obviously quite a view people here have no objections to stealing other people's money to fund pet projects.

    Justifying it with delusions of grandeur and making the world a better place does not change the reality that most of this IS a waste of money exactly as the article states.

  • Report this Comment On October 19, 2012, at 1:39 PM, MaxTheTerrible wrote:

    Actually, most, if not all, scientific studies listed in this article sound legitimate to me (as a scientist). Yes, they all have an "amusement factor", but so what?! All basic research have little *immediate* practical use, therefore it has to be funded by the government. The problem is you never know what will give you the next breakthrough. The whole biotechnology space development hinges on a guy collecting samples from the ocean depths in a submarine.

    Cheers!

  • Report this Comment On October 19, 2012, at 2:01 PM, damilkman wrote:

    I have to agree with those who are pointing out the science bashing. These are the types of items academia should be researching. Just because an activity appears to have no perceived direct use does not mean the activity of basic science is useless. If there was a 17 billion dollar study to build a robo squirrel I would say the author has a point. Would the author bash the NSFNET for the millions of dollars of grants given to Universities to promote the advancement of applications that use TCP/IP much less the millions given to subsidize their connectivity? There was a point in many of our lifetimes when network activities were just a cost center. I would say a few hundred billion dollars later that investment was worth while.

  • Report this Comment On October 19, 2012, at 4:04 PM, douglee8 wrote:

    The urinal cake costs $25 each, cheaper than the $100 breathalyzer.

  • Report this Comment On October 19, 2012, at 4:19 PM, TMFDiogenes wrote:

    <<"The urinal cake costs $25 each, cheaper than the $100 breathalyzer.">>

    That's an awesome sentence.

  • Report this Comment On October 19, 2012, at 4:33 PM, TMFUltraLong wrote:

    Those urinal cakes are unlikely to last forever... plus I'd call a urinal cake talking to patrons to assess their intoxication levels a "little" less accurate than utilizing a breathalyzer. Just saying....

    TMFUltraLong

  • Report this Comment On October 19, 2012, at 4:35 PM, TMFUltraLong wrote:

    On a completely related side note, I want to remind those of you who think I'm attacking scientific findings that I love science. Yes I have my degree in Economics, but I was not always an Economics major. Originally, when I entered college I was an animal physiology and neuroscience major so science sort of runs through my blood. The NSF funds outlined in Waste Book however are just comical in nature and don't seem to serve any purpose to someone like me who subjectively sees the U.S economy running a trillion-dollar deficit each year and needing to cut costs.

    TMFUltraLong

  • Report this Comment On October 19, 2012, at 6:47 PM, Thaeger wrote:

    Regarding #9, $148 million is absolute _peanuts_ compared to the waste associated with defense contractors; you'd think trying to foster a more competitive environment for them would be applauded by any sincere fiscal hawks.

    "...Overall, the cost overruns associated with the military's major weapons systems have decreased slightly compared with a year ago. But they still total near $300 billion, and the average program delay has stretched from 21 to 22 months, Gene L. Dodaro, acting comptroller general at the GAO, said in a report...

    ...Some large programs had such cost overruns that they could not afford the original quantities contemplated, the report said. A prime example is the Air Force's F-22A Raptor, built by Lockheed, on which costs skyrocketed 195 percent, the GAO said. The Air Force cut its order from 648 planes to 184..."

    ( http://www.washingtonpost.com/wp-dyn/content/article/2009/03... , March 2009 )

  • Report this Comment On October 19, 2012, at 7:32 PM, mrpraxis wrote:

    The point is that too often scientific grants are bestowed NOT because they're good science with perceived public/private benefits attached but rather primarily because these are grants/experiments that CAN be done rather than SHOULD be done. This is what is wrong with so much funding in science these days. Any time someone criticizes science funding they are reflexively attacked as being a Luddite. Not so. Rather, we DO have a responsibility and a right to engage in WHAT/HOW money is spent in Washington and not to merely to bless anything that the NSF grants as being worthwhile. While I was in grad school I worked in the biology department at one of our MAJOR universities as essentially a proofreader of professors' grant proposals to correct their English etc. I found that many of these professors would re-investigate their Ph.D. dissertations over-and-over again and seek grant money for it...and they would RECEIVE taxpayer-funded grant money to do it precisely because they could show evidence that they COULD conduct their investigations. NOT, rather whether they SHOULD do so. THAT is what we're talking about here. So.........no false Luddite charges here....we ALL need to be good stewards of the taxpayer's dollar in these trying times. This means laying down much stricter oversight in useless funding of experiments that have no value to society. This does not, by the way, limit/eliminate monies to basic science research. This list speaks to the broken nature of HOW and WHY science funding occurs.

  • Report this Comment On October 22, 2012, at 5:08 PM, Qmak wrote:

    Regardless of the merits of the cited programs, it seems unusual that the Fool would allow for the republication of any politician's document without analysis or fact-checking.

    Regardless of the issue, the strength of the Fool has always been in its thorough reasoned review of available information.

    This article doesn't reach that standard and I hope this isn't repeated in the future on some other issue.

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