Taxpayer Funds Paid for Bonuses, Casino Trips

WASHINGTON - House Republicans Wednesday rolled out $35 billion dollars worth of proposed cuts in the budget for this year, including $2 billion slashed from job-training programs.

(Scroll down to watch a video of this report)

Taxpayers spend $18 billion a year on them, but government investigations are questioning whether all that money is doing much good, CBS News Investigative Correspondent Sharyl Attkisson reports.

Ramona Cunningham headed a job training program in Iowa, but it turns out she was moonlighting on the dark side as a ringleader in a fraud and corruption scheme. She used taxpayer money on $1.5 million in illegal bonuses for herself and others. They took a hundred trips to casinos, usually during work hours.

Abuses like that are why two government reports out Wednesday hone in on all the tax money devoted to training people for jobs.

Read the GAO Report (PDF)

The General Accounting Office found $18 billion in taxpayer money a year are going to not one but 47 different federal job training programs, almost all of them overlapping to serve the same people.

Nobody can say how well they work. Only five have ever been studied to see if trainees got more jobs than anyone else.

"Shouldn't Congress know if they're going to spend $18 billion whether it's working?" Sen. Tom Coburn, R-Okla., asked.

The Labor Department, in charge of 21 different employment training programs, said it serves diverse groups and that fewer programs wouldn't necessarily be better or more efficient.

But Coburn said the bureaucracy leaves too much room for abuse. He issued his own report, calling it "Help Wanted," exposing outrageous examples.

Read the Report from Coburn's Office (PDF)

In California, three men are under indictment for allegedly luring high-school kids into removing cancer-causing asbestos without proper protection, all under the guise of job training.

Mary Jane Bowling, once an executive at Workforce West Virginia, got caught illegally funneling $100,000 tax dollars to her son, Martin.

The stimulus law added $5 billion more to job training. Finding examples of waste wasn't hard. It's not so easy to find evidence the programs work well.

[crazyname]

Start from zero and add to the budget. Going backwards can't find all the pork and stealing. Every bill that gets passed is full of pork.

[montanajobs]

I find this report to be disturbing and not completely accurate. We have received Stimulus money for Job Training and have NOT misused the funding. With our funding this is what we have been able to do: Our community is small - about 32,000 population and has been hurt from the recession. The Subsidized Employment - Job Training has put 19 people to work in above minimum wage jobs (average $10/hour), with an average of 475 hours of subsidized employment. At the end of their subsidized employment 50% were offered employment at a higher wage, 30% continued at the wage they were making AND added college classes, 20% chose to explore other employment. None returned to TANF.

The employers who used this job training commented that this helped them maintain their business during tough economic times. They were able to "keep their doors open". They also noted the employee's confidence improved, learning curve was faster, and they were able to train a new employee without the stress of loosing the employee and money.

Our goal was participant success. We case managed the participant, worked closely with the employer, worked with other service providers to insure the participant was able to remove barriers to continued employment. It was a HUGE success in our community. Our fellow Subsidized Employment providers throughout the state of Montana have similar stories and outcomes. Finding successes, PROVEN successes, is not all that difficult.

[endurorob_5]

So subsidized employment means the government (tax payer) paid part of the wages of a person working for a private company? And just because you claim there was no misuse of funds in your community does not make this report innacurate. At best it makes your community and exception to the standard.

[Psyllicon]

In your small community of 32,000 -- subsidizing the wages of 19 people at an average #10/hr for an average cumulative 475 hours work means the taxpayer got hit with a $90,000 duty to support private enterprise with free labor. I take it that is Progressive?

[realist51]

like so many other issues here nobody attacks the problem, just each other, agreed 21 differnt programs, make them all 1 put better regulations and restrictions into the system, watch it for 2 years and then evaluate it, this makes it smaller , more efficient and tests the results, just shutting it down accomplishes nothing. currently one of the biggest complaints from corporate america is "untrained people or under qualified people" this is more about oversite and acountability than shutting it down. same goes for the military spending. if a tool or tank costs x amount of dollars to make then no more than 10% profit above actual cost of each and every component.

[endurorob_5]

Why should it be the tax payers responsibility to pay for training people so they can get a job?

[olebasiclady]

What does this say about Federal Government? Corruption abounds!

Federal Government should not be in the job training business AT ALL.

It is all a waste of money. The only people the FG should train is the ones working directly in FG jobs.

[pragmatist1]

It doesn't matter which party initiates the measures. Just get rid of the waste in all areas of government. Start in DC and get to the state and city level. The waste can also be found in areas of fraud in Medicaid, Medicare, illegals, etc. and also needs to be eliminated.

[endurorob_5]

gramljon February 9, 2011 10:36 PM EST
I can't wait until the Republicans start looking at the Defense Department. The money for employment & training programs, which do help people get jobs, is peanuts compared to what is wasted at the Pentegan.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++You obviously didn't read the article either. It is not easy to find evidence that these programs work.

[endurorob_5]

"The Labor Department, in charge of 21 different employment training programs, said it serves diverse groups and that fewer programs wouldn't necessarily be better or more efficient."+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++Fewer would likely be much easier to monitor so that billions of tax payer dollars aren't wasted. How idiotic of the labor department to defend the current situation.

[brnfream]

Tell me AGAIN, why the need to cut SS and Medicare? Is there anyone compitent in the HOUSE, OR the SENATE? Where are these programs locted? Chicago, perhaps?

[kennethdp]

So, we're going to cut job training but continue to dump money into corrupt military contractors to the tune of $1 trillion. Instead of killing job training programs that aren't working, why not start over? But no, people trying to get their lives back are walked upon and the corrupt rich get everything.

[endurorob_5]

Didn't you read the article. It is easy to find corruption in the programs but not easy to find eveidence the programs work.

[vancouverboo]

Money to burn and fools to give them more.

[wjksea]

There will never be a big government without taxes but their will be crooks telling us all to do without with the exception of themselves.