Under the original Covid-19 stimulus plan an additional $600 per week in unemployment benefits was provided to supplement the state unemployment benefits for the unemployed that are normally available.
This is ended up being controversial in that in a number of states this additional amount made it much more lucrative to continue to receive unemployment benefits than return to work. As employees were recalled to work after the economic lockdown ended, employers in some states revealed that many workers did not want to return to their previous job because they made more money on employment than working.
The Trump administration wanted to extend the benefit when it expired at the end of July and curb this disincentive to work but the Democrats were steadfast in stating that it had to be continued at the prior level.
No agreement was reached so President Trump, not wanting to see deserving people lose the benefit, signed an executive order extending the benefit with $300 in extra federal payments per week as long as the state chipped in an additional $100 in matching funds.
This further angered the Democrats who argued that many states could not afford the extra $100.
Interestingly, there does not seem to be a concern on whether the federal government can afford it.
Overlooked in all of this is how much has already been spent and how much fraud has been perpetrated with those trying to get their hands on this government largesse.
Consider this story out of my home state of Ohio in which it was revealed that the state had paid out hundreds of millions of dollars in fraudulent unemployment benefit claims.
The state reported that it had paid as much as $200 million per week to what appeared to be as many as 270,000 fraudulent accounts.
The state did not seem to be pick up on the scheme until early July. That would be almost 12 weeks after the wave of unemployment filings began. $200 million x 10 is a lot of money.
If this is going on in Ohio it makes you wonder what is going on in New York and California? What is going on in other states?
If there is one thing that is certain, when the government is involved in anything the chances that fraudulent activity will occur is almost certain.
Consider the fraud in Medicare and Medicaid payments. The Department of Health and Human Services revealed several years ago that improper payments (i.e. fraudulent claims) for Medicaid amounted to 12% of all payments. Fraud involving Medicare is estimated to be 11% per year. We are talking about costs of over $100 billion per year in improper and fraudulent payments.
Between 2004 and 2017 the Social Security Administration admitted that it had made improper payments totaling over $1.3 trillion. That is also over $100 billion per year.
Back in 2014 I wrote about the increasing fraud resulting from the electronic filing of tax returns and the fact that the IRS was putting money on prepaid debit cards. The thieves don't even need to have a bank account or receive a check so the fraud can be traced! Why? Because it might be discriminatory to assume someone might have to cash a check or have a bank account.
A thief can steal your name and Social Security number and e-file a completely phony tax return. The IRS has no way of checking the accuracy of the return data at the time the return is filed (including whether the withheld taxes are correct because no W-2 is filed with electronic filing). The IRS accepts the tax return at face value and if a refund is claimed it will transfer the money on to a prepaid bank debit card.
All the fraudster has to do is file the fraudulent tax return before you file your legitimate return. In fact, if you file your tax return after the fraudulent tax return, I have heard stories that indicate that you will feel like the criminal. As you can imagine, it can take hours and hours of your time to get the IRS bureaucracy straightened out.
With the increased use of e-filing this fraud has become rampant. For example, the Treasury Inspector General for Tax Administration recently reported that it believed that the IRS paid out over $5.2 billion in fraudulent refunds in 2011 alone!
What is certain about all of this?
Government is a magnet for fraud. It is big. It is impersonal. There are trillions of dollars in play. There is very little accountability by those who are in charge. After all, it is not their money. It is your money.
The biggest topic of interest right now for the Democrats is the push for mail-in voting this Fall.
Consider the examples above and tell me how that is not just a perfect recipe for fraud.
Our voting systems are not set up to handle volumes of ballots that are mailed in. All the systems (voting machines, poll workers etc) have been established for in-person voting where collecting and counting the votes is done with automated machines and identities can be checked (where voter ID is permitted) by poll workers. Even if voter ID is not required in a state, in-person voting requires a real person to show up in person at the polls which limits attempts at voter harvesting and other fraudulent acts.
Some argue that mail-in voting is no different than absentee voting. This could not be further from the truth. Absentee voting requires that the voter request a ballot. It also typically requires that some reason be given that the voter cannot vote in person. It also requires some form of ID so that identification can be confirmed (drivers license number, etc). A signature is required that is supposed to be matched to the voter rolls.
Absentee ballots have also typically made up less than 20% of the ballots in an election year. They were 17.7% of all votes cast in 2016.
Moving to mail-in ballots when the entire voting system and infrastructure is geared to in-person voting is an invitation to fraud every bit in line with the unemployment benefits fraud seen in Ohio this year.
To insure the integrity of the election it would be necessary to have scores of people opening the mail, tabulating results and verifying signatures and voter id's against the registration rolls. It would be many times more laborious than the current system and require more time.
It would also almost guarantee that we would not have election results for days or weeks after the election day.
Mail-in voting (or something more sophisticated technologically) is something that may make sense in the future.
However, it must be accompanied by changes in the systems and election infrastructure that have been developed to service in-person voting over a period of years. It is not realistic that it could be changed in a matter of a couple of months without confusion and chaos occurring. I can think of nothing worse happening in a year when the integrity of the vote is so important to gain public trust.
One requirement that I believe is absolutely necessary in mail-in voting is that the votes must be in hand at the Elections Board by election day. Voters deserve to know the final results on election day and not days or weeks later as we have seen in some of the mail-in states like California and New York where ballots are coming in days after the elections. Allowing votes to come in and be counted after initial results have been tabulated is another invitation for fraud.
The bottom line is that anything that Government touches is a magnet for fraud.
Taxpayers pay for that fraud every day as their hard earned tax dollars are stolen.
Voters should not expect that their votes will be cancelled out by fraud as well.