September 27, 2013
We all should be thankful for the vigilance of the Washington Post, otherwise we might not know about an agency in Alaska that could be wasting around $1.8 million a year in federal spending. The Post decided to do a major story on the inspector general of a small development agency in Alaska who wrote a letter to Congress saying that the agency was a waste of money and should be closed.
According to the piece, the agency, the Denali Commission, was the creation of former Alaska Senator Ted Stevens. At one time more than $150 million was flowing through it to finance various projects in Alaska. This flow has been reduced to $10.6 million following Senator Steven’s defeat and subsequent death.
The immediate issue according to the inspector general is not the $10.6 million in projects, many or all of which may be worthwhile, but rather the agency itself. The inspector general complained that it was an unnecessary intermediary for these funds and therefore a waste of taxpayer dollars.
The article indicates that the agency has 12 employees. If we assume that total compensation for each, plus the indirect costs associated with running the office, come to $150,000 a year, then the implied waste would be $1.8 million a year, assuming that no equivalent supervisory structure would need to be established elsewhere in Alaska’s government.
If we go to CEPR’s incredibly spiffy budget calculator, we see that this spending qualifies as less than 0.0001 percent of the budget. Clearly this article was a good use of a Post’s reporter’s time and way to consume a large chunk of space in the newspaper.
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