One Percent Fraud Rate Sounds Good. 450,000 Criminals Ripping Us Off Sounds Worse.

You know the old saying about how figures lie and liars figure? Well, it might as well become our national motto as far as I am concerned. When it comes to presenting numbers I am always wary when either a percentage or an actual number is given, but not both. I have seen it often enough to justify my hesitation. The way it works is the least offensive and shocking of the two is used to put as happy of a face on things or prove a point that seems silly when taken in actual context.

For example, maybe I hear that a baby crib is dangerous and needs to be recalled because six kids got their heads caught between the rails. How horrible! What a poorly designed product! Hang the malicious designers of this evil product up by their toenails! Oh, wait, there are over a million of said cribs in existence? Just 0.0006% of kids who sleep in this product get their heads stuck? Hey, I do not know about you, but I do not demand perfection. And the later tells me that, honestly, there is nothing wrong other than some kids with really small heads whose parents should be a little more careful and aware.

Now, let’s look at Kevin Concannon, undersecretary for food, nutrition and consumer services at the U.S. Department of Agriculture. Mr. Concannon actually stood before Congress and crowed about how good of a job the federal food stamp program was doing. His rationale was that the program’s rate of fraud standing at 1% [1] was, “one of the best records among federal programs.” [2]. However, with approximately 1 in 7 Americans on food stamps, 46.5 million [3], one percent does not sound as good as you might think it does. One percent of 46.5 million is 465,000 cases of fraud every year. And that is for just one federal program.

Of course, saying that fraud in the food stamp program stands at 465,000 cases per year is more shocking than saying “1%”, so the government opts for the less shocking and later measure to report their “success”. The government also crows about how well it is doing in weeding out food stamp fraud. It tells us all about how much fraud is dropping like how it was 9.86% in 1999 and 6.63% in 2003 [4]. But what the mouth pieces of the government forget to mention is that over time, despite some dips, the number of Americans on food stamps has increased. For example, in 1970 about 1 in 50 Americans were on the program. Let’s look at those numbers now. In 1970 there were 203.4 millions Americans [5]. That means about four million people were on the program then and it would take a fraud rate of 11% to match the amount of fraud, by number of cases, not total dollars, today.

Furthermore, with a fraud rate of 465,000 every month, and an average of $133 per month [6] paid per participant, it means we are flushing $742,140,000 down the drain every year. That is a lot of money, no matter how hard you try to spin it. It is $742,140,000 borrowed from our great grandchildren so that we can give money to people who are scamming the system. In a decade, at this rate, government is flittering away almost seven and a half billion dollars. The scammers are laughing all the way to the bank while American burns and Washington’s elites fiddle.

Now, think about all the federal programs we have and extrapolate the amount of waste in food stamps, which we are told is good at just 1%, out to include all those departments which are being defrauded worse and it will bake you noodle. Maybe you will get a little peeved and demand action. Maybe you will just shrug and accept the crime being perpetrated upon you. I think most Americans will opt for the later, sadly.

[1] http://www.npr.org/2012/03/08/148235246/house-committee-urges-action-on-food-stamp-fraud

[2] http://www.foxnews.com/politics/2012/03/08/food-stamp-fraud-increasingly-sophisticated-despite-reports-drop-in-cases/

[3] http://blogs.wsj.com/economics/2012/03/02/more-than-1-in-7-use-food-stamps-in-u-s/

[4] http://usgovinfo.about.com/od/healthcare/a/foodstampgao.htm

[5] http://en.wikipedia.org/wiki/1970_United_States_Census

[6] http://www.statehealthfacts.org/comparetable.jsp?cat=1&ind=26

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