Beefy Résumé for a Giant Job: Policing Stimulus Spending

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With states eager to spend, President Barack Obama announced new guidelines Friday limiting the role lobbyists can play in determining how $787 billion in economic stimulus money will be used. Video by AP

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By Philip Rucker
Washington Post Staff Writer
Friday, March 20, 2009

Promising unparalleled scrutiny of his $787 billion wager to stimulate the economy, President Obama appointed to police the spending a burly former football lineman and Secret Service agent with a reputation for exposing wrongdoers.

But with public money already flowing through state and local governments toward shovel-ready projects, Obama's top stimulus cop does not yet have a computer, phone line or office, let alone a full staff. And he told Congress yesterday it will take 30 to 45 days before he wrests control of what he considers perhaps his greatest asset in ferreting out fraud: the Web site Recovery.gov.

"There's more questions than answers right now," Earl A. Devaney, the Interior Department inspector general who Obama picked to lead the administration's stimulus accountability and transparency efforts, said in an interview. "It's a big task . . . and we're just trying to keep our heads above water."

For Devaney, 61, the challenge is without modern precedent. He is tracking a sum nearly 70 times the size of Interior's annual discretionary budget. The funds are being funneled quickly to thousands of programs. The stimulus is so awesome in size, scope and speed, Devaney said, that fraud is inevitable.

"Logic would suggest there's going to be a loss of money to fraud and waste with this amount of money going around," said Devaney, who chairs the Recovery Accountability and Transparency Board -- or RAT Board, as it is affectionately known. "This is huge. I've been involved in building and fixing things in the past, but quite frankly I've never built something this big."

Yet a single misdeed would threaten to severely taint the administration and deal a crippling blow to its efforts to stabilize the global economy. Amid populist furor over $165 million in bonuses paid to executives at the bailed-out insurance giant American International Group -- and with the looming possibility of a second stimulus bill or additional government bailouts of failing banks -- the White House is under great political pressure to ensure that the stimulus money is spent wisely.

The RAT Board is a grand experiment in government oversight. Made up of inspectors general from across the government, it is tasked with coordinating with overseers in federal, state and local governments to detect and prevent fraud, waste and abuse of stimulus money. But while most inspectors general are skilled at examining fraudulent activities through audits or criminal investigations, the RAT Board's priority is to install preventive measures to ensure that no fraud occurs in the first place.

"Obviously when things go wrong they should be found out and snuffed out, but that's second best to preventing things from going wrong," said Vice President Biden's chief of staff, Ronald A. Klain. Biden oversees the board and meets weekly with Devaney.

Rep. Elijah E. Cummings (D-Md.) said most oversight investigations begin after funds have been disbursed. But in this case, he said, "we're in front of the distribution of the funds, so therefore we're in a position to hopefully prevent a lot of the fraud and abuse that might normally come."

Congressional Republicans, however, are not leaving it to the Obama administration to police stimulus dollars. A bicameral group of GOP lawmakers said they are organizing an independent working group for spending oversight. "We have to do everything in our power to ensure taxpayer money isn't wasted," said House Minority Leader John A. Boehner (R-Ohio).

If 7 percent of the stimulus money is lost to waste -- the figure generally expected for government spending, according to Rep. Dan Burton (R-Ind.) -- that would work out to $55 billion. In a congressional hearing yesterday, Burton observed to Devaney that given the outcry over AIG bonuses, that level of stimulus abuse would prompt the American people to "march on the Capitol."

"The first time I took a pencil and figured that out, I was horrified to see it was $55 billion," Devaney said.


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