Everyone makes questionable financial choices. But most individuals' money mistakes are chump change compared with the waste, fraud, and just plain dumb decisions made on a larger scale by private companies, government institutions, and billionaires every year. As 2019 wraps up, let's review the most staggering instances of financial waste that occurred or were made public in the past months.
Money wasted: $71.8 billion
You have essentially the same chance of winning the lottery whether you play or not, but that didn't stop Americans from spending $72 billion, or $220 per person, on tickets in 2017, the most recent year for which data was available. That's more than we spend on movies, video games, or concerts, yielding far less entertainment value. According to research by online lender LendEdu, residents of Massachusetts spent the most per individual ($737) and North Dakotans the least ($35).
Money wasted: $1.7 billion
A disastrous year for co-working conglomerate WeWork ended with the rebranded "We Company" shelling out an unprecedented $1.7 billion exit package to force out CEO and founder Adam Neumann, who, in his loftiest moments, had fantasized about becoming "president of the world." The company's projected valuation fell to just $5 billion from $50 billion, somewhat symptomatic of Big Tech's speculation-driven startup culture now crashing back down to Earth.
Money wasted: Around $161 billion in the US
About one-third of the world's food goes to waste each year, according to the UN. America throws out an estimated 30% to 40% of its food supply, or approximately 133 billion pounds and $161 billion worth. Globally, richer countries in Europe and North America are responsible for 209 to 254 pounds per capita a year, compared with 13 to 24 pounds in sub-Saharan Africa and south and south-eastern Asia, and most of it occurs at the consumer or retail level due to "quality standards that overemphasize appearance."
Money wasted: nearly $1 billion
Simultaneously the most maligned and requested of holiday gifts, gift cards can either simplify shopping or make money simply disappear. About $1 billion of the money packed away in gift cards goes unspent every year, reports of a CEB TowerGroup study said last year. All those minuscule sums people either forget about or are too proud to use really do add up, but there's a thriving market in buying, selling, and trading "used" gift cards on sites such as Raise and Cardpool, and 11 states mandate stores pay back a remaining balance below a certain threshold.
Money wasted: More than $4.6 million
Toward the end of each fiscal year, federal agencies tend to splurge on outside contractors in a frenzy to run out their budget, lest they come in under and lose the funds for the next year. Of the $544 billion allotted for outside contractors in 2018, for example, almost $97 billion was spent in September, the last month of the fiscal year. The Department of Defense was responsible for almost two-thirds of these last-minute expenditures, with the most newsworthy items being $2.1 million on games and toys, $490 million for furniture, and $4.6 million on crab and lobster tail.
Related: 30 All-You-Can-Eat Seafood Restaurants Reviewers Love
Money wasted: $31 billion
The facts of environmentally overwhelming plastic waste and little to no oversight on water quality didn't stop Americans from spending $31 billion on bottled water in 2018, according to by Consumer Reports. Bottled water also costs 600 times more and requires up to 2,000 times as much energy to produce than tap water, meaning this waste of money and resources isn't confined to just consumers.
Related: Tasty Tap Water: 14 Best US Cities for Clean Drinking Water
Money wasted: Billions
Federal, state, and local governments in America have all been known to subsidize building sports stadiums through direct subsidies and tax-exempt municipal bonds, despite 83% of economists agreeing that they cost taxpayers more than any economic benefits generated. Despite coming under fire from both sides of the political spectrum, the trend continued unabated in 2019. Sacramento approved a $33 million subsidy package to develop a Major League Soccer franchise and stadium for the city.
Related: 13 World-Famous Stadiums Where You Can Still Catch a Game
Money wasted: $417,000
The Washington Metropolitan Area Transit Authority spent at least $417,000 over 14 years maintaining one self-cleaning toilet that hasn't worked since 2017, according to a semi-annual report from the Metro's Office of the Inspector General. They also noted that this is likely an underestimate, since the invoices were missing for four of the years concerned.
Related: Worth a Go: 20 Unique Bathrooms Every Tourist Should Check Out
Money wasted: More than $1 million
In case you missed it in the rapid-fire news cycle of the Trump impeachment inquiry, key witness and U.S. ambassador to the European Union Gordon Sondland was revealed to have spent more than $1 million in taxpayer funds on renovations to his homes in Brussels and Washington, D.C. Far from the first administration official to be implicated for lavish personal spending, Sondland's purchases included $33,000 for Italian handmade furniture, $13,000 for a "split heat system Jacuzzi/swimming pool," $95,000 for the installation of an "outdoor living pod/pergola," and $100,000 for his family to relocate during the renovation process.
Related: 10 Little Home Improvement Projects That Make a Big Impact
Money wasted: $5.8 billion
Marketers pay for online advertisements based on the clicks they generate, but many of those impressions are generated by "bots," not people, with as many as 1 in 5 ad-serving websites visited exclusively by the programs meant to imitate some kind of human behavior. In May, anti-fraud vendor White Ops and advertising trade group the Association of National Advertisers projected that $5.8 billion would be lost to fraud this year. North American markets may be among the worst affected, as Juniper Research estimates advertisers will lose $100 million a day within the next five years.
Related: 10 Signs You're Getting Scammed While Shopping Online
Money wasted: billions
In another instance of governments giving tax dollars to a profitable industry, states continue to subsidize film productions with large tax exemptions that rarely affect filming location decisions and often provide negligible returns on taxpayer investment. Louisiana's subsidy costs taxpayers $100 million a year, getting just 36 cents back for every dollar invested, according to The Advocate.
Money wasted: $1 trillion (total)
John Ehrlichman, one of President Richard Nixon's closest aides, has admitted America's "War on Drugs" was a hoax designed to vilify and disrupt "the antiwar left and black people" when it was launched in 1971. Since then, more than $1 trillion has been spent on federally funded anti-drug efforts, according to the Center for American Progress. Meanwhile, the illicit drug trade may be more profitable, diffuse, and dangerous than ever.
Related: 12 Things to Know Before Buying Cannabis in States Where It's Legal
Money wasted: $30 million and more
There's an entire multimillion-dollar industry devoted to buying and reselling desirable URLs to companies or individuals willing to pay top dollar for highly visible domains such as CarInsurance.com, which sold for $49.7 million at the start of the decade. This year, the most expensive domain sold was Voice.com for $30 million, bought by Block.one for its block-chain social media platform, now in beta testing.
Money wasted: $80 million
While more than a half-million Americans are homeless, including 63,000 in New York City, the richest man in the world spent $80 million on three apartments for himself overlooking Madison Square Park. Including the penthouse apartment and two units beneath it, the purchase afforded Amazon founder and CEO Jeff Bezos a dozen bedrooms and 17,000 square feet when he stays in the Big Apple, one of the year's most expensive real estate transactions.
Related: Why Warren Buffett and Other Billionaires Pay Less Tax Than You
Money wasted: $50 billion
Illicit financial flow refers to the deliberate loss of money through under-invoicing practices that may include the plundering of natural resources and poaching of exotic wildlife. For every $1 a developing nation gains, it loses more than $2 to these shady practices as well as lending and interest repayments to rich countries or foreign investors, according to the international Committee for the Abolition of Illegitimate Debt. Africa incurs as much as half of the world's losses through this fraud, with the UN estimating at least $50 billion is lost annually.
Money wasted: $69 million
Each one-cent penny cost 2.06 cents to make in 2018, while each nickel cost 7.53 cents. Though both spiked this year thanks to rising metal prices, pennies have cost taxpayers more than they're worth for 14 years. The Government Accountability Office reported that in fiscal year 2017, the U.S. Mint wasted $69 million producing pennies and $21 million on nickels.
Money wasted: $59 million
His company may be notoriously casual about what it does with user data, but Mark Zuckerberg does his best to keep his spending private. When the Facebook CEO and his wife Priscilla Chan paid $59 million for two neighboring Lake Tahoe estates in May, the deals were processed using a limited-liability company, a high-end wealth manager, and a series of nondisclosure agreements mandating, in part, that all listing pictures be scrubbed from the internet. The Wall Street Journal reported they were also interested in buying a third home across the street, following a similar model to their main home in Palo Alto, around which they bought four additional properties. Zuckerberg was once considered on the frugal side for a billionaire.
Money wasted: $26,000
Three officials for Michigan's Genesee County wasted $26,000 of taxpayers' money on a trip to Orlando, Florida, where they were to "attend the Disney Institute to receive training on leadership, employee engagement, and quality customer service." To protest and call attention to the expenditure, the county's clerk-register called a press conference in his office while wearing a Mickey Mouse costume and covering his desk in fake cash.
Related: 26 Ways to Do Disney on a Budget
Money wasted: $4 billion
The U.S. Department of Homeland Security spent $4 billion in fiscal year 2018 to detain and deport immigrants in accordance with the Trump administration's ongoing family separation policy. This June, reports (again) put this cost to taxpayers in more human-sized proportions as $775 per night per child, most of which goes to maintenance, compared with $298 to keep them with parents in established detention centers or other, more permanent structures. Separated children stay in the pop-up facilities around two months, compared with a maximum of 20 days before the policy.
Money wasted: $141 billion
For fiscal year 2017, the most recent year for which data was available, government agencies reported a collective $141 billion in improper payments, including over- and underpayments, duplicates, and ineligible recipients. There was already a working solution to this problem for one reporting agency — Medicare — that Congress put in place in 2005, and it returned $11 billion to the Medicare Trust Fund at an accuracy rate of 96%. But lawmakers, pressured by hospitals and medical trade associations, reduced the claims reviewed to 0.5%, from a high of 2%. Citizens Against Government Waste estimates taxpayers could save $3.6 billion in the next year if the program were reinstated to former levels.
Money wasted: $700,000
Even among billionaire tech CEOs, Elon Musk's private jet use goes above and beyond. Flight data obtained by The Washington Post in January showed the Tesla and SpaceX founder logged 150,000 miles in 2018 on around 250 flights at a company cost of $700,000, compared with $93,000 with Apple CEO Tim Cook in 2017. Traveling in comfort and solitude is one thing, but Musk took 20-mile trips between airports on the south and north sides of Los Angeles, sparing him maybe an hour in traffic.
Money wasted: More than $25 million
In one of the year's juiciest and most damning scandals for the supposed meritocracy of some of America's most prestigious universities, 50 people were charged and 33 parents accused of paying more than $25 million to William "Rick" Singer to inflate test scores and bribe officials on their children's behalf. In cooperating with the FBI, Singer said he managed 761 such "side doors" admissions for wealthy families.
Money wasted: $1.4 billion
According to Citizens Against Government Waste, Congress has earmarked funds 41 times for upgrading M1 Abrams tanks since 1994, amounting to $1.5 billion from taxpayers. In 2019, the Trump administration increased its funding request by $1.4 billion over the previous year, telling tank plant workers in Ohio, "You better love me — I kept this place open." But the spending goes against the wishes of the Pentagon and Department of Defense, which notes flaws in the M1 for modern warfare and insists its fleet of tanks is in good shape, which is why 2,000 of them gather dust in the California desert.
Money wasted: More than $2.1 billion
In development for 18 years and eight years behind schedule, the F-35 has become the most expensive weapons system in history, with lifetime operations and maintenance costs estimated to total $1.2 trillion. This year saw even more congressional earmarks and financial boondoggles, including a March report that the program had failed to track $2.1 billion worth of property leased to private contractor Lockheed Martin. Because of the delays, the Air Force also detailed plans to buy 80 new F-15Xs, an upgraded version of the planes that were supposed to be replaced by the F-35. Yet Congress approved earmarks for more aircraft.
Money wasted: $11 million
Around the turn of the 20th century, affluent families such as the Vanderbilts and Astors built lavish summer homes on the cliffs of Newport, Rhode Island, that were synonymous with leisure and wealth — until the Great Depression, when many were sold to preservation societies and other nonprofits. Billionaire Larry Ellison, founder of Oracle and owner of 98% of a Hawaiian island, has acquired ownership of four such properties, buying the last at 562 Bellevue Ave. for $11 million in February. (Though he also spent upward of $100 million renovating the Astors' Beechwood mansion for a museum.)
Money wasted: More than $70,000
France's environment minister came under scrutiny in July when an investigation alleged he had financed renovations and a dozen ritzy dinner parties for 10 to 30 guests between 2017 and 2018. The functions featured lobster entrees and vintage wines costing up to $558 a bottle, while the refurbishment cost $70,330 for nonessential measure such as paintwork, carpet-fitting, and fitted cupboards.
Money wasted: $69 billion
Created as a one-time emergency supplement in 2001 to pay for antiterrorism efforts, this fund has morphed into a loophole for annually appropriating billions that should be factored into standard Department of Defense budgets. The $69 billion provided for the program in 2019 was spent largely on unrelated, non-emergency items. If actually spent on overseas military operations as intended, it would amount to $2.7 million for every single troop the United States has stationed in Afghanistan, Iraq, and (until recently) Syria.
Money wasted: More than $500,000
Between freezing employees' pension plans, former board president Oliver North trying to oust CEO Wayne LaPierre, and ending up $11 million in the red, 2018 was a complicated year financially for the National Rifle Association, as revealed by a report obtained by The Washington Post. Lavish spending by LaPierre drew fire, including $275,000 at a Beverly Hill's men's store and more than $253,000 in luxury travel — while spending on educating gun owners about safety and marksmanship, one of the group's essential functions, dropped by nearly a quarter in the same period. That continued this year, even as low-level employees complained of low pay and poor conditions.
