Skip to comments.Here is why Homeland Security is buying so much ammo (My Working Theory)
Posted on 04/26/2013 10:39:35 AM PDT by dila813
Quick run down on budget management in the federal government:
1. Prior to the start of the year, you made a budget request 10% higher than last year's budget
2. At the beginning of the fiscal year you are given a budget target to spend for the year
3. During the year, if you are running short due to demand you put in requests for supplemental funds
4. As you approach the end of the year, if it appears you are going to still have money left. You have to spend it, you look for items that aren't perishable and have a long time for storage (great place to look are items you placed a large number of orders during the year, as in number of orders not number of items). This routinely happens in Republican Administrations, in Democrat Administrations it can be 2-3x what you would normally see. I believe this is because the Dems are poor planners and only have eyes for key projects.
Ok, Baseline budgeting
1. Prior year exceptional spending becomes part of the base line budget going forward (like billions of dollars in upgraded luggage and people scanners in airports)
2. .... etc... rinse and repeat leading to inflated budgets
Ok, Supply Chains:
... commodities like ammo are produced linearly throughout the year because the inventory is cheaper than having excess capacity to react to changes in demand
further, when orders come in, no one is going to turn down the order no matter how big, but since it was such a huge order it took away all this critical buffer inventory leading to shortages when the public demand picked up at the same time eliminating all their inventory in their distribution channels.
No grand conspiracy, just poor lousy government
The fiscal year starts in October and ends in September, this means this all started in September of last year and these shortages of ammo can go on for a year due to the tight capacity.
And yes, once upon a time I did this, it was my job and I hated it.
You are assuming they have no plans to deny us ammunition by legislating the industry out of business after they stock up.
Correct. There is no giant conspiracy. Breitbart has a good article debunking the ammo myths:
They usually buy everyone a new computer...
With any other administration, I would agree with you.
True, I have to say there are different categories of funds.
Not all the money can go into new computers. That pile of money was quite limited.
The big bucks are in the operating funds.
But, I always had the best computer on my desk every September.
Very disappointed in US ammo makers selling so much to the DHS.
I will remember when things loosen up.
Shows he stupid the US ammo makers are.
They are still going to need ammo for themselves.
This is a lot more logical than most of the theories floating around.
Except, #4, that is the traditional baseline approach but most agencies now are going beyond baseline to exceed the rate of growth in order to get future budgets increased.
In other words, in traditional baseline budgeting, if they are budgeted to increase by $100, if they spend $90, their next budget is considered a $10 cut so they try to spend $100. This has evolved to go beyond the projected growth rate so if they are budgeted to spend $100, they try to spend $200 so their next budget will be increased by that amount (and so on and so on and so on).
I don’t blame them entirely, I blame this stupid process we have with the budgets of spend it or loose it mentality.
That’s the root cause of lots of government evil in the US economy.
No grand conspiracy....you just know they love it that the people believe there’s a grand conspiracy.
They have government supplier contracts that many have had for decades and if they don't fulfill those contracts, it will jeopardize their businesses. Some, even have entire divisions solely dedicated to fulfilling government orders. If they don't, it will collapse their business.
These aren't mom and pops who choose to give it to x or y depending on who places an internet orders. These are massive industries who make on the order of 50 billion plus rounds per year.
This might be true at an agency level, but in the trenches at your individual offices this isn’t true.
You request 10% more than last year, they give you a new budget that is at this level or near it to spend for next year.
Why 10%, that was the rule of thumb, no logic behind it.
The whole thing was stupid.
Sorry, but I don’t think that Obambi’s handlers have any intention of leaving our White House. They’ve probably sold every national secret to our enemies, undone any secrecy to anything that’s important to our security, and Lord knows what else they’ve done to our country.
And if an actual president comes in with his administration and finds out how much damage these morons have done, they’ll probably wind up in prison.
No, there’s a much larger plan . . . and I pray for us when it happens.
Yep, at agency level. Their ‘caps’ were pulled. This is whey the sequester was such a joke. For the past few years they have been jacking up their baselines higher and higher.
I don’t know what you are talking about, it isn’t contracting at all.
These are straight buys on contract for immediate delivery.
You can’t consider the money spent unless you actually take physical delivery of the item.
well, this was invisible to me, but I suspect this lead to even greater distortions in the marketplace.
I hate to burst your bubble but its not that benign. More likely its to keep ammo supplies scarce while gunning up for the inevitiable conflict with the American public.
7,000 full auto AR’s and 2717 armored trucks are not just to make sure all alloted funds get spent.
The is is not your daddy’s govt.
A question, dila...
If the government issues the purchase order for “up to” a gazillion rounds, they have spent their budget, as funds are allocated even if the actual purchase is not made.
The following years’ budgets gets these funds rolled over, for the next hypothetical PO awarded for ever-increasing purchases that are never consummated. Are they just parking money this way?
BTW, thank you for taking on the free energy spammers that pop up here occasionally.
What budget? Did I miss something?
come on, truly.... how much do you think they need to buy in order to replace the spending they did previously at the peak of the spending for integrating the TSA with billions spent for scanners.
ammo has a long life, its small, can the cost is high for the space it takes up.
I have walked into warehouses that were packed with excavation equipment in wooden crates as far as the eye could see from the 80s that sat in mint condition never been used.
budgets within agencies, not the congressional budget.
This is the operating budgets.
it is, but its cost is low for the space it takes up
not a good candidate for this kind of spending
“since it was such a huge order it took away all this critical buffer inventory leading to shortages when the public demand picked up at the same time eliminating all their inventory in their distribution channels.”
No, I’d say this part of your theory is incorrect, because the DHS order is not extraordinary. It’s at the same level as their order from previous years going back at least a decade. So, the sole reason for the shortage is the public panic buying, since the DHS purchases would have had no effect on any buffer inventory.
That hardly explains so much $$$$ spent on ammo when they could just as easily bought office furniture with it. Ammo isn’t going to make their lives more cushy but a nicely decorated office with a big leather desk chair would. That also doesn’t explain why so many gov depts who have no need for such large amounts of ammo were ordering it too.
Why weren’t you disappointed in them when they sold the same amounts to DHS under the Bush administration?
we weren’t allowed to roll over to the next year,
you had to get the item physically in hand, under your physical control. This could simply mean driving over there and putting it in the trunk of your government vehicle.
If you receive it next year it was part of that year’s budget.
We wouldn’t place an order if it wasn’t going to be in time.
In fact, the government developed a specific type of order for these iffy cases. The “Fill or Kill”, the supplier fills it per the requirements including the time of delivery or the order is null and void, self-canceling.
I think one thing to remember is that everyone who works at DHS does not carry a weapon. A good deal of them are just administrative types.
They are not the military and they have no need to be armed up to the teeth to the point that they can carry on the Iraq war for 20 years. This agency is morphing into Ostumbles civilian national defense force and will deployed on every highway and byway to enforce the new transformed country on all of us. It needs to be stopped.
Gee, Boss, I have no idea how that box of ammo got into my pocket.
Still, if no overall budget how can agencies set budgets when they have no clue how much they have? Simply basing off last year is not good enough.
I smell graft and misappropriation everywhere.
Different category of budget item, that money is a lot more limited and the government says you have to use GSA contracts for a lot of that stuff.
In some cases, the building/office with all the furniture is handled by GSA and we don’t have anything to do with it.
No one was screaming conspiracy theories at that time.
The “armored truck” story is a myth. They were purchased by the Marine Corps.
The fedzilla knows a date certain is approaching beyond which they will no longer be able to resupply their domestic army. The planned collapse must be close given the amount of stocking up these democrips are doing. What we need is to find out where they ammo is being shipped, because if it is near or in one or more of the several hideaways that have been built to house and protect the oligarchs during the destruction of America, then we will know for sure what the agenda is.
There are always operating budgets, these budgets are based on what was appropriated at the agency level by congress and then filtered down the ladder to the low level spenders like me.
I bet there is a place just chock full of this ammo where you could see it.
I bet they have ammo going back to the 1970s.
I am sure if congress wanted to, they could bring the press in to see the ammo stash.
DING! DING! DING! This is the SINGLE worst thing about the federal government.
In business, you are praised if you save money for the company. In government you are encoraged to spend it all, OR ELSE.
There is no incentive to save.
If we had a one-year program where anyone in the fed govt could get 10% of ANY money they saved, I bet the budget would be cut in half in one year.
but that would become their budget from then on.
Back in my Purchasing Agent days we used to call that “Different Color Money” ... Fed $ for Hurricanes (and other Natural Disasters) was “Free Money” and all Money (no matter what color) was to be spent before Oct
In government, it is like of like my Wife’s idea on sales, you only save when you spend....
It’s crazy, insane, its our government at work
So another guy or gal that had to manage the operating budget..
I am so glad I don’t do that anymore. It corrupted me ethically and hurt my personal life.
I didn’t realize it at the time, but looking back I know it is true.
Cheerio, I am telling you. I did this job, this rule wasn’t communicated to us.
If you are arguing that this was against the law, maybe it was. I am telling you what really goes on.
We were under clear directions to spend that money no matter what. If you didn’t and you messed up, your career would be hurt.
The IDIQ contract vehicle only sets out the T&Cs of the contract and the pricing schedule. EACH DELIVERY ORDER MUST INCLUDE THE APPROPRIATION CITATION WHICH WOULD IDENTIFY WHAT THE SOURCE OF FUNDS ARE. e.g. O&M funds cannot be used to purchase an item of supply or a service for a future year’s USE.
I hear ya - I also worked this issue but from the Contractor side.
I am looking at what you linked, but this was for contracting agents for the US Government and not those managing the operating budgets.
Purchasing Agents buy off contracts and directly from suppliers based on a requisition.
Operating budget managers create the requisitions.
As far as the Purchasing agent is concerned, the requisition is the justification needed for making the buy.
yeah, I have seen contract delivery schedules get moved up just to be able to spend the money in the current fiscal year, like a ship overhaul or truck maintenance.