Economy Ralph Nader

Ralph Nader: The Biggest Business in America? Defrauding Uncle Sam and You.

In terms of sheer stolen dollars, the total amount is greater than the annual sales of Amazon and Walmart over the past two years.
[Alessandro Pautasso / CC BY-NC-ND 2.0]

By Ralph Nader

The biggest business in America is stealing and defrauding the federal government, Uncle Sam and you the taxpayers. In terms of sheer stolen dollars, the total amount is greater than the annual sales of Amazon and Walmart over the past two years.

Before getting to the real big stuff, start with how much was stolen or not delivered by the contractors in Iraq and Afghanistan. Just in one program, John Spoko—Special Inspector General for Afghan Reconstruction (SIGAR), estimated that $30 billion of the $100 billion repairs project was purloined. Despite his many damning reports on what was also wasted—like the $40 million natural gas-powered fueling station (there were no natural gas-powered cars in Afghanistan)—no one was indicted, no one was fired, no one missed a promotion. This is according to author Andrew Cockburn, who interviewed Spoko extensively for his new book The Spoils of War: Power, Profit and the American War Machine. In fact, Cockburn writes: “They were giving bonuses to people for stealing our money.”

Of the $360 billion in annual billing fraud by the health care industry, over $100 billion is fraud on Medicare and Medicaid.

Turning to the $6 trillion appropriated (without reversing the tax cuts by Trump on the super-rich) by both Trump and Biden since March 2020, government investigators and the media are seeing staggering thefts and frauds. Money was stolen outright by fake companies and fraudulent applications, or taken by profitable companies, law firms and others that these programs were never intended to benefit.

One estimate has the trillion dollar Paycheck Protection Program delivering only 25 percent to the people for whom it was intended. Even people like the notorious anti-taxer Grover Norquist, who is loaded with corporate donations, applied for and got a bundle of tax dollars.

From the beginning I called members of Congress to caution them to draft very tight language in the giant rescue and infrastructure programs in order to foresee and forestall the predictable giant heist. There were some provisions—expanding enforcement budgets and inserting certain general review obligations on government agencies. But it was massively too little and too late— and utterly inadequate for the volume of coming robberies.

Corporate lobbyists were already swarming over Capitol Hill to get their bailouts, grants, sweetheart contracts and other benefits. The airlines got about $50 billion in bailouts, for example, after they had bought back $45 billion of their own stock from passenger revenues.

The mass media was also largely inattentive, spending far more time on the friction between politicians in Congress than the burning of taxpayer dollars. The Inspectors General attached to each federal agency were timid, under-budgeted and had weak authority.  Moreover, several Inspectors General positions were vacant.

Professor Malcolm Sparrow at Harvard has shown how there are specific, proven ways to prevent thefts and frauds on government programs. Effective criminal law enforcement authority, adequate enforcement budgets and plenty of investigators and auditors with higher level political support are crucial.

Neither Congress nor the White House have met this challenge of titanic corruption which should become a major campaign subject in the coming elections. Apart from a few perfunctory hearings, Congress has not held the high profile intense hearings that grab public attention—in part because both Parties have culpability, though the GOP is worse.

Biden spoke briefly this month about this thievery in his State of the Union address and promised a chief prosecutor for pandemic fraud.  This is a little late. And where was the mention of adequate budget and authority? Professor Sparrow recommends that the enforcement budgets for commercial crimes have to be at least one percent of the estimated theft/fraud. The Biden oversight isn’t a tenth of that measure.

Finally, The Washington Post and The New York Times have started to investigate. The findings of their lengthy features are predictably staggering, especially regarding the Small Business Administration (SBA) which dispatched $343 billion in PPP loans over a 14 day period!

As recounted in the NY Times article by David Farenthold, a free for all robbery spree took hold.  The SBA made classic, foreseeable blunders. First, it subcontracted out, without due diligence, to so-called nonprofits, the job of distributing and monitoring the expenditures, giving them 15 percent of the overall disbursements to, for example, children feeding programs. The blunder not only is an inappropriate delegation of governmental powers, but it also creates a perverse incentive for the overseer to shovel out money to subcontractors.

Biden’s Department of Agriculture arrogantly turned down Farenthold’s request to interview officials there. This is another sign of unpreparedness, enabled by a Congress that astonishingly let the Department “waive rules that had been put in place after previous scandals to make sure states watched the watchdogs,” wrote Farenthold. (See “F.B.I. Sees ‘Massive Fraud’ in Groups’ Food Programs for Needy Children”.)

A longer expose appeared in The Washington Post by Tony Romm with the headline “’Immense Fraud’ Creates Immense Task for Washington As It Tries to Tighten Scrutiny of $6 Trillion in Emergency Coronavirus Spending”.

Romm’s examples are about sheer theft. A person pleaded guilty who somehow got $4 million and spend chunks of it buying a Porsche, a Mercedes and a BMW. A man was sentenced to prison for obtaining $800,000 for a business that did not exist. Fake or shell companies getting grants and unpayable loans illustrate that the guardrails were non-existent in thousands of cases.

So minimal are the prosecutorial initiatives that the commercial criminals are still  actively seeking  huge sums in grants, loans, direct payments and other forms of emergency assistance.

The SBA’s diligent Inspector General, Hannibal “Mike” Ware, has been producing report after report, incurring the hatred of Trump and his then-SBA Administrator, and still not convincing Congress that without more enforcement funds, the corporate crime wave will prosper unabated. Even so, Romm points to evidence that dozens of criminal fraud cases were preventable with some more diligence from the SBA. It isn’t reassuring that Romm reported that SBA officials turned down interview requests by the Post.

Recent efforts by a long-culpable Congress and a long-neglectful Presidency are not close to catching up with current robberies, not to mention any chance of retrieving stolen monies. Ever since I requested in 1971 that President Richard Nixon set up a commission on corporate crime, the federal government has remained obstinately indifferent to the sheer scale of ‘crime in the suites.” Consider the looted military contracting budget and the global level of corporate tax evasions up against the tepid responses from Washington. Too much discretion was delegated to the state and local governments without strict criteria. One New York Republican-controlled municipality is about to spend $12 million to renovate a baseball stadium.

Without a tradition of Congress requiring annual compliance reports from federal agencies, which would require securing regular data feedback flows, the government  will continue to be caught flat-footed.

Why should the three working days a week Congress, with no skin in the game, really care? If it isn’t the unorganized taxpayers paying for these massive thefts, the next generation of Americans will get the tab. Especially since the solons on Capitol Hill have refused to rescind the huge Trump tax escapes for the wealthy and giant corporations that have ballooned the federal deficit.


  1. Oh Ralph – as Biden assured us “nothing will fundamentally change” – that is until we throw the corporate funded duopoly out of office and replace it with those who are people funded. You indicated you knew that when you ran for office – 4 times. I voted for you all 4 times – but not enough other folks did, so here we are and nothing has fundamentally changed ..

      1. To Humble,
        I humbly suggest that “viability” is what we make it – there are non-corporate 3rd parties out there, and have been for decades, who actually stand for the stuff we say we want and need – and if we decide they are “not viable”, we are in deep do-do indeed. So if we sit on our hands and allow others to decide what is “viable”, if we do not support and promote and VOTE for them – then none of that stuff will ever be “viable”. I find it rather bizarre, if you will, that in poll after poll we say we want/need 3rd parties – but when they appear we do not vote for them … So who, in the end is responsible for our predicament …

    1. I voted for Nader three times, and for my brother once. All to no avail.

      1. To John,
        “All to no avail” – it was to “no avail” because not enough folks did it – so is the answer for us to stop voting 3rd party or to vote for it in ever increasing numbers – if, e.g., more of us had voted for Nader in ’04 than in ’00, and more again in ’08 – then more for Stein in ’12, etc., we would have been much closer to getting what we really want and need – (remember, it wasn’t Nader who “cost” Kerry the election in ’04, just as he didn’t in ’00) … voting LOTE sounds good until we actually get that LOTE – and watch as “nothing fundamentally (changes)” over and over and over – If the Ds charge “spoiler” every time a 3rd party dares to raise its head at the polls, and they will, even when it’s manifestly ludicrous – maybe its time we actually did, big time – if you don’t think that would shake the PTB to the core – think again – THAT is a revolution, using the tools our FF gave us – the voting booth –

  2. Oh, Ralph. He sets the stage: since 1971 he’s been clammoring to the politicos to do something about their casino-bilking-theft capitalism?

    I don’t think Ralph is quite up to date on just how very pernicious and all-powerful some of these criminals are. Take for instance . . . . The “blacks” — Black Stone and Black Rock. Quoting, and read it yourself — real estate and data. What a nice one-two punch. Military Offensive Murdering Civilians Weapons Complex cheats? These Vanguard’s and Black/Stone/Rock’s have us checkmated!

    Blackstone founder, Stephen Schwarzman, recently made headlines after he reaped the biggest dividend haul in the history of Wall Street, when his 19% stake in the private equity firm netted him $941.6 million in share bonuses. In addition, the 75-year old billionaire collected $160 million in straight profits as well as cutting himself a $350 million-dollar paycheck for services as the CEO of the company he started decades ago, bringing his total compensation for 2021 closer to $1.5 billion.

    Asset management companies proliferated in the wake of the 2008 financial crisis, and Blackstone has emerged as the largest of them all, with nearly $1 Trillion under management, currently. Real Estate – particularly industrial real estate –, is one of Blackstone’s main investment vehicles, presently owning more industrial real estate than any other private entity on earth, besides its main competitor, Prologis. Up until last year, Blackstone was only second to the U.S. federal government in commercial property ownership as well, but cashed out when the rental properties it snapped up for bargain basement prices during the pandemic rose 40% last year.

    Flush with cash, Blackstone is now poised to make deeper inroads into the logistical real estate market and position itself as the tech industry’s landlord. Already controlling several hundred million square feet of industrial storage space in Asia, Schwarzman’s firm has set its sights on expanding its also sizable industrial real estate holdings in the U.S., as it seeks to “leverage the data from all of Blackstone’s other businesses”, which run the gamut of digital services, and are tied directly to the e-commerce boom resulting from the lockdown protocols and the growing momentum for remote work, and the tele-medicine business in which it is also heavily invested.

  3. The United States of American has always been a FASCIST state masquerading as a democracy.

    The classical definition of fascism is the conjoining of the political and economic elites. This has long been the structure within the United States.

    Certainly the misnomer which passes for democracy has never had anything to do with the equitable distribution of wealth or ongoing popular participation absent the biennial or quadrennial window-dressings, propaganda projects, which serve to give “credence” to the lie about democracy.

    For only in a functionally fascist state can the military-indistrial-congressional-media-finance oligarchs be able to achieves the results America has for decades. The galloping consolidation of wealth, a burgeoning prison population as the continuation of chattel slavery.

    Those results have always meant that criminals, as defined above, can have a virtual monopoly over the national budget.

    Capitalism works hand in hand with fascism. Unlike what is the accepted narrative about a desire for competition, it is monopoly or oligopoly which the elites demand. And within a FASCIST state these ends are always met.

    Further, a close examination of the wider cultural history of America, as externalities, prove our fascism charge.

    There are an endless number of examples which can be cited. These could include, but not lumiyed to, the intention to attack the Soviet Union immediately after it had led the fight against fascism.

    The way America has always supported military, dictatorial and fascist regimes all over the world. The way it and it’s corporations steal the resources of world countries. And we can go on ad infinitum!

    Short of a collaspe of this monster, on its own weight, by the denial to take other people’s things, the avarice of the American regime currently in power will continue to demand more and more of the national budget and as a corollary there must be less and less for a guilable populace.

    1. We Yanquis no need no stinkin’ laws of universal human rights…..

      One book on your list,

      The updated and expanded 3rd edition of Super Imperialism: The Economic Strategy of American Empire is now available. This highly respected study of U.S. financial diplomacy explores the faults built into the core of the World Bank and the IMF at their inception. Forensic detail reveals how the world’s core economic functions were sculpted to preserve US financial hegemony. Difficult to detect at the time, these problems have since become explicit as the failure of the international economic order has become apparent; the IMF and World Bank were set up to give aid to developing countries, but instead many of the world’s poorest countries have been plunged into insurmountable debt crises. The book became famous for detailing how the removal of the gold standard left the world’s central banks with only …

      Continue Reading…

  4. The appalling corruption is abetted wickednesss. Although Nader quotes The NY Times and Washington Post articles approvingly, overall the fourth estate (press) has not done due diligence, perhaps in part because its profits come from advertising?
    And fie on the Democratic and Republican parties!

    I am reminded of teachings of Jesus. (1) What profits a person to gain the whole world and lose his/her soul? (2) One can NOT love both God and Mammon (money and power), but will love one and hate the other.

    1. To Allen,
      Well now we know which one they love .. And hey, who can resist gaining the world with amazing profit margins …

  5. America! America!
    God shed his grace on thee
    And crown thy good with brotherhood
    From sea to shining sea! \s

  6. Excellent report. Remember that the investigative agencies are fully corrupted, because a large part of these federal funds come back to the political parties of their appointed bosses, or go to party beneficiaries. They are afraid to investigate either major party even for proven major thefts of federal and state funds.

    I am prosecuting a group of Florida ranchers active in politics, who stole about $120 million in conservation funds by claiming that their ranches are panther habitat, despite keeping them deforested by burn-offs and completely unsuited to panthers, which have never been found or tracked within 30 miles. For years I researched the issues and filed a federal racketeering case with six Memoranda of Law and seven Appendices of Fact.

    The prosecution of political corruption exposed widespread judicial corruption: Florida state judges are among the thieves, and federal judges protect thefts for their political parties, in this case all Republicans (I am neutral).

    Florida federal judges refused to seal the case or request investigation by the DOJ, FBI, HSI, or IRS, so the case was filed successively in five other states where Republican judges illegally denied on the false claim that damages to Florida property owners in their states (from 30 to 3500 times their felony crime threshold) were magically insufficient even for jurisdiction. Every judge in FL, ME, CA, HI, and OR lied outright to protect political racketeering.

    The the DOJ, FBI, HSI, and IRS regularly prosecute racketeering of less than one percent this amount, and convict an average of 70 lower public officials a year in Florida alone, more than any other state. But for three years under both Trump and Biden, the local, national, and IG offices of each agency were notified of the crimes via their own websites, emails, certified letters, and even certified packets with the racketeering Complaint and full documentation, and requests to investigate the matter. At no point did any of these offices respond in any way, let alone investigate. Every one of them secretly protected the racketeering crime that funds the political parties of their bosses.

    At last, I listed the corrupt agencies among the defendants and filed the case in the DC district which could not deny jurisdiction, but it simply lied that it was not necessary to seal the case during investigation, despite the fact that the law requires that, and such cases by those agencies are always sealed during investigation, and those agencies do not investigate unsealed cases. There are no more courts in which to prosecute the corruption of the US government.

    Both Presidents and several legislators were also notified and never replied. So the entire US government is fully aware that federal and state funds are stolen outright for their political parties, and neither party’s hacks dare to prosecute the other party, as they would all go down together.

    1. To Sam,
      Wow! It is stories like this that flesh out the concept of political corruption – thanx for telling it …
      What to do, we gotta throw the bums out …
      Do you think Ralph would have any ideas ..

      1. Ralph and his organization are welcome to contact me by comment here or at CongressOfDebate dot com. Just include an email address for reply.

  7. It’s important to detail the costs and harms of authority, and also important to summarize it. Authority was conceived as a parasite upon humanity, nature, earth, space. Quite a variety of ways is entirely predictable, as every way is exploited, like the ants explore every direction for opportunity. It’s important to note that one way is no better/worst than another, because a conceived parasite scheme was dead out of the gate. Anarchism is defined as the absence of authority, all authority, all its schemes, all directions, all levels, all colors. Anarchism is universal respect for life’s intrinsic worth and free will. You can take the ethics and logic from here to every star in every galaxy.

  8. All hierarchies, like institutions, corporations, and governments exist to advance corruption, which in an unordered world is difficult to the point of impossible.

    Has there ever been an honest (moral) government, or corporation, or church, or army?

    Living for morality can only be an individual pursuit for the simple reason that we can’t read minds. The collective mind is an unknowable mind- each member having an erroneous belief in the aggregate purpose with no possible proof of same.

    Fill a glass with water – now, add just one drop of bleach – the whole glass has been polluted.

    What the sages called “heaven” is not a destination, it’s a state of individual mind. Your group can’t take you there, it’s only for individuals.

    1. Oh, that’s right, the “all” falsity in your statement. Then, has there ever been a moral this or that?

      Then, the one man is an island, and all men and women on that island are all living for very different purposes and therefore “living for morality” is up to the individual.

      Nah, go back to your sofa,, please.

      Some of us have worked with churches, even a bloke like me, a non-believer, and alas, they weren’t all corrupt, and if one was, it never messed with the whole. You know, refugee work in El Paso and Mexico bringing in those children,, women and men who were forced out of Guatemalan villages thanks to US proxy wars, School of the Americas, etc.

      I also teach, and to have this stupidity as your core belief is more than just cynical. Of course life is a battlefield, absolutely, not a Gaia dream. However, collectively, the hive works, and unfortunately, the collectives that work fine are the Military Chemical Ag Mining Energy Prison Finance Banking Insurance Legal AI Congressional Complex. They number in the tens of millions. The rest of us — those others — are farmers and leavers.

      Mother culture was going fine, before ag scortched earth policies, and we need to reset our tribal mentality and our tribal ethos (don’t go yammering about tribes to me).

      You just don’t get how corrupt a few at the top and their Eichmann’s are. Collective delusion, collective amnesia, collective false hopes, collective Stockholm Syndrome, collecitve anxiety disorder, well, these conditions are the work of those busy bees, the Eichmann’s, Friedmans, Bernays, and, well, you get the picture.

      Collectivism and intentional communities and cooperatives and cooperative learning, they work fine — unfortunately, the Capitalists are few but very very powerful. They are the jailers in a sense.

      I’ll use your heaven as an individual state of mind.

  9. Ralph, You are the man! Your work has done more to help this country than all the politicians who are feeding at the trough.

  10. Biden mentioned something about battling corruption in his State of the Union address, Ralph? You’re far too old and knowing (I hope) to believe anything coming out of that old criminal liar’s mouth. What Cracker Joe and his friends actually are doing is cooking up WW 3. Perhaps you missed this. Perhaps you also missed the last Legislative session in which Biden and company didn’t even pretend to try to move any of their grandiose and promised plans through. It’s clear now that Biden’s forced ascendancy to president was about nothing more than finally dropping the hammer on Russia. Few Americans will miss the obvious here, with billions eagerly promised for war, and not even crumbs for the vast majority.
    It’s over, Ralph. Yet you’re still imagining that the Dems, who despise you even more than the toady Sanders, might somehow turn into something they never were.

  11. If we are very corrupt then we are not a viable democracy that is required to be in Nato.
    So, are we not corrupt because we lead Nato?
    Or we are corrupt and should be expelled.??
    Or forget it, Nato is for westerners to spend billions on military budgets.

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