Surprise! Government Overpaid $14 Billion in Unemployment Benefits in 2011

Posted: Jul 10, 2012 11:27 AM


In yet another sad tale of government incompetence, the U.S. Labor Department reported that federal and state governments combined to overpay jobless benefits by $14 billion. This $14 billion accounts for about 11% of all unemployment spending. CNN reports:

But of the overpaid funds, most end up in the hands of three types of people: Those who aren't actively searching for a job, those who were fired or quit voluntarily, and those who continue to file claims even though they've returned to work. Any of those circumstances would make a person ineligible for benefits.

The overpayment typically results from an administrative error made either by the government, the employer, the worker or a combination of the three.

The Labor Department reports that roughly half of their overpayments are recoverable, although CNN’s report indicates that the Department has historically fallen well short of recovering half of its overpayments. If the government cannot handle unemployment benefits, one can only imagine how badly Washington bureaucrats would bungle Obamacare in 2014. Fear not though, President Obama has put his best man on the job.

Vice President Joe Biden is charged with leading the Campaign to Cut Waste, an initiative started last year that aims to cut overpayments at federal agencies.

Problem solved.

This post was authored by editorial intern, Kyle Bonnell.