The federal government spends a disproportionate amount of its budget for outside contractors in the final month of the fiscal year, as agencies rush to blow through cash before it’s too late. Among the more noteworthy expenditures in 2018, according to the watchdog group Open the Books, was $4.6 million for lobster tail and crab.
Such use-it-or-lose-it spending stems from the fact that each federal agency is given a certain amount of money it can spend on outside contractors for the fiscal year. If the agency comes in under budget, Congress might decide to appropriate less money the following year.
Or as The Office‘s Oscar Martinez explains to Michael Scott in “The Surplus”: “Your mommy and daddy give you $10 to open up a lemonade stand, so you go out and you buy cups and you buy lemons and you buy sugar. And now you find out that it only cost you $9, so you have an extra dollar,” he explains. “So you can give that dollar back to mommy and daddy. But guess what: Next summer, and you ask them for money, they’re going to give you $9 because that’s what they think it cost to run the stand. So what you want to do is spend that dollar on something now, so that your parents think that it cost $10 to run the lemonade stand.”
It works the same way at the federal level. Just replace that $10 with $544.1 billion—the amount federal agencies spent on contracts in the last fiscal year.
Of that $544.1 billion, almost $97 billion was spent in September 2018, the final month of the fiscal year, including $53.3 billion in the final seven days of the month. That’s compared to $47 billion spent in the entire month of August. As the fiscal year came crashing to an end, bureaucrats apparently did their best to spend as much money as quickly as possible.
The Department of Defense led the pack, spending $61.2 billion in September. The Pentagon was followed not-so-closely by the Department of Health and Human Services ($5.7 billion), the Department of Veterans Affairs ($5.4 billion), and the Department of Homeland Security ($4.2 billion).
Federal agencies spent $402.2 million on food that month, with the Pentagon shelling out $2.3 million on crab and $2.3 million on lobster tail. Also, “agencies spent $2.1 million on games, toys, and wheeled goods,” Open the Books notes, as well as “$412,008 on paint and artist’s brushes.” A whopping $490 million went to furniture, including a baffling $9,341 for a Wexford office chair. Agencies also spent $49,515 for skis and ski poles, $11,816 for a foosball table, and $258,901 on pianos.
The biggest recipients of the contracts were a trio of military companies: Lockheed Martin ($8.3 billion), Boeing ($5.3 billion), and Raytheon ($3.4 billion).
That $97 billion last September represents a 16 percent increase from the $83.7 billion federal agencies spent on contracts in September 2017. The figure was nearly $73.6 billion in 2016 and $69.6 billion in 2015.
In August, a bipartisan group of senators that included Kentucky Republican Rand Paul wrote letters to 13 federal agencies expressing their concerns about wasteful end-of-year spending. Their efforts appear to have failed.