While outright fraud in government spending is low (under 1%), Buttigieg argues the real financial drain is waste from inefficiency. He points to project cost escalations and procedural roadblocks as far more significant sources of wasted taxpayer money than criminal fraud.

Underfunding the IRS is not a neutral act but a policy choice that disproportionately benefits the rich. Auditing complex, high-value returns requires significant resources. A weakened IRS cannot effectively pursue wealthy tax evaders, creating a massive "tax gap" that functions as a stealth tax cut for the top earners.

According to James Burnham's "Iron Law of Oligarchy," systems eventually serve their rulers. In government, deficit spending and subsidies are used to secure votes and donor funding, meaning leaders are incentivized to maintain the flow of money, even if it's wasteful or fraudulent, to ensure their own political survival.

The biggest tax cut isn't a legislative change but rather neutering the IRS's budget. The agency lacks the resources to audit the complex finances of the wealthy, incentivizing aggressive tax strategies and leaving hundreds of billions in legally owed taxes uncollected each year.

Senator Booker highlights a Congressional Budget Office finding that significant tax cheating occurs at high income levels. Simply enforcing existing tax laws by adequately staffing the IRS to audit complex returns from the wealthy could recover tens of billions of dollars for the government.

The immense regulatory complexity in U.S. healthcare creates an estimated $500 billion "tax" of administrative bloat. The non-obvious opportunity is that by using AI to eliminate this waste, the savings could be redirected to fund expanded patient care, rather than just being captured as profit.

Estimates place Medicare fraud at 10-15% of all spending, a figure well over $100 billion per year. This staggering amount, which is more than half the Army's budget, highlights the massive financial drain and its pernicious downstream effects on the entire healthcare system, including rising costs and eroded trust.

A significant source of waste stems from "zombie payments"—recurring government funds that continue indefinitely without review. When the official who authorized the payment leaves, retires, or dies, there is often no system to shut it off, creating a perpetual drain of funds to companies or individuals who rarely report it.

To combat waste, government agencies can adopt a 'zero-baseline' approach similar to Elon Musk canceling all corporate credit cards at Twitter. This forces all payees to re-justify their services, immediately exposing fraudulent or unnecessary auto-payments.