Government Spending with Fexingo: Budget, Deficits, and Public Finance Explained

Lucas and Luna unpack why government infrastructure projects — roads, bridges, rail — routinely cost two to three times more than comparable private-sector builds. The focus is on prevailing wage laws, specifically the Davis-Bacon Act of 1931, which requires contractors on federal projects to pay locally 'prevailing' wages — often union-scale rates that can be 30-50% higher than market rates. Luca...

Lucas and Luna dig into the Davis-Bacon Act of 1931, which requires 'prevailing wages' on federally funded construction projects. They examine how this law, originally meant to protect local workers during the Depression, now adds 30 to 50 percent to the cost of federal buildings, highways, and military bases — costing taxpayers an estimated $10 billion per year in excess wages alone. Using a conc...

When the U.S. government funds a war, it doesn't put a line item in the budget. Instead, it uses 'emergency' designations and supplemental appropriations — a practice that has allowed over $2 trillion in Iraq and Afghanistan costs to bypass normal budget rules. Lucas and Luna trace how this started with the Korean War, exploded after 9/11, and now accounts for roughly 15% of annual discretionary s...

When a natural disaster or national security crisis hits, Congress typically passes emergency funding bills that bypass the normal budget process. In this episode, Lucas and Luna break down how 'emergency designations' have become a routine loophole for adding hundreds of billions to the deficit. They walk through specific examples: the $13 billion disaster aid package that included money for non-...

Episode 101 of Government Spending with Fexingo: Budget, Deficits, and Public Finance Explained. Hosts Lucas and Luna dig into the hidden fee ecosystem that governments layer onto everyday transactions—from passport renewals to parking tickets to business licenses. Lucas walks through a concrete case: the state of Maryland's vehicle registration fee, which includes a separate surcharge for 'automa...

Episode 100 of Government Spending with Fexingo drills into one of the biggest hidden liabilities in public finance: state and local government pension funds. Lucas and Luna unpack the specific math behind the $1.4 trillion funding gap for U.S. public pensions as of mid-2026. They focus on the Illinois Teachers' Retirement System, which has only 40 cents set aside for every dollar promised. They e...

Episode 99 of Government Spending with Fexingo examines why federal efficiency initiatives, from the Grace Commission to the current DOGE-style units, rarely achieve lasting savings. Lucas and Luna walk through the structural incentives that doom these offices: political timelines that clash with multi-year reform cycles, performance metrics that reward studies over action, and the revolving door...

Governments spend trillions of dollars annually, yet their own auditors consistently miss the biggest sources of waste. This episode examines why the US Government Accountability Office and similar bodies focus on compliance and fraud while ignoring structural inefficiencies that cost taxpayers far more. We break down a 2025 study showing that financial audits catch only 0.2 percent of potential s...

When the US Treasury needs to borrow money, it doesn't just call up a bank. It runs a multi-billion-dollar auction every single week. In this episode, Lucas and Luna break down the mechanics of government bond auctions: who the primary dealers are, how competitive and non-competitive bidding work, what the 'tail' tells you about market stress, and why the Treasury's 'when-issued' trading matters....

Episode 96 of Government Spending with Fexingo examines a well-intentioned policy that hits an unintended wall: the Inflation Reduction Act's Medicare drug price negotiation. Lucas and Luna walk through how capping prices on a subset of drugs creates a counter-effect—higher launch prices for new drugs and fewer generic entrants. The hosts anchor the discussion on the first ten drugs selected for n...

Episode 95 of Government Spending with Fexingo drills into a specific, regressive subsidy: the US government's tax break for employer-provided parking. Lucas and Luna unpack how this $7.3 billion annual subsidy disproportionately benefits high-income commuters in expensive urban cores, while low-income workers and transit users get next to nothing. They trace the policy back to 1984, examine how i...

When the U.S. Department of Defense needed a new logistics software, it spent a billion dollars over eight years, then scrapped the project. This episode drills into how government procurement rules—designed to prevent corruption—actually discourage innovation. Lucas and Luna walk through the specific case of the DoD's failed ERP system, compare it to commercial software deployments, and explain w...

Every year, governments publish balance sheets showing debt-to-GDP ratios that seem manageable — usually under 100 percent. But those numbers exclude the biggest obligations: future pension payments, healthcare entitlements, and infrastructure maintenance. In this episode, Lucas and Luna examine a 2025 study from the Hoover Institution that calculated the United States' true fiscal shortfall at ov...

Episode 92 examines how the US federal government spends roughly $20 billion a year on fuel tax subsidies that disproportionately benefit high-income households. Lucas and Luna trace the history of the gas tax freeze from 1993 to the present, showing how a once-progressive revenue tool became a regressive subsidy. They walk through data from the Energy Information Administration and Congressional...

Episode 91 of Government Spending with Fexingo digs into how Medicare and Medicaid reimbursement rates inadvertently fuel hospital consolidation. Lucas and Luna examine the 2023 study from the National Bureau of Economic Research showing that a 10% cut in public reimbursement rates leads to a 3% increase in hospital mergers in that market within two years. They walk through the mechanics: when pub...

In this episode, Lucas and Luna dig into a specific case: the U.S. federal tax expenditure for carried interest, which costs taxpayers roughly $14 billion per year. They trace how this loophole originated in 1993, why it persists despite bipartisan criticism, and what it reveals about the broader category of tax breaks as hidden spending. Lucas breaks down the mechanics — how fund managers pay 23....

Episode 89 of Government Spending with Fexingo dives into the staggering failure rate of large government IT projects. Lucas and Luna examine the $5 billion California Medicaid system that never went live, contrasting it with the UK's Gov. UK Notify platform that cost a fraction and works. They unpack three root causes: requirements bloat, procurement rigidity, and vendor lock-in. The hosts also d...

In this episode, Lucas and Luna examine how government fee structures — from passport renewals to small business filing fees — often embed hidden costs that far exceed the actual service provided. They break down the specific case of the U.S. passport application fee, which has risen from $65 in 2000 to $165 in 2026, while processing times have doubled. They explore how fees are used as a hidden t...

The federal government is the largest buyer of prescription drugs in the United States, but it pays more than almost any other developed country. This episode explains the paradox of monopsony power: why being the single biggest customer doesn't always lead to lower prices. Lucas and Luna examine the specific case of Medicare Part D, where a legal ban on direct price negotiation costs taxpayers an...

Episode 86 of Government Spending with Fexingo explores why government renewable energy power purchase agreements often come at a premium compared to private-sector deals. Using the example of a 2024 U.S. General Services Administration solar PPA in Texas, Lucas and Luna break down the specific contract clauses — fixed escalation rates, guaranteed output floors, and lengthy permitting contingencie...

Episode 85 of Government Spending with Fexingo dives into the hidden cost of government debt—specifically, how rising interest rates have turned a manageable burden into a compounding crisis. Lucas and Luna unpack the mechanics of debt rollover, the gap between average coupon rates and current market yields, and why the Congressional Budget Office's 2026 projections show interest payments consumin...

Episode 84 of Government Spending with Fexingo. Lucas and Luna explore a rarely discussed mechanism: how government insurance programs — from flood insurance under the National Flood Insurance Program to deposit insurance via the FDIC — accidentally suppress private market innovation and pricing signals. Using the NFIP as the anchor case, Lucas explains how subsidized premiums in flood-prone areas...

Episode 83 of Government Spending with Fexingo digs into why federal employees routinely pay 2 to 3 times the market rate for airline tickets and hotel rooms. Lucas and Luna break down the Government Travel Charge Card program, the Fly America Act's requirement to use US carriers even when foreign options are cheaper, and the per diem system that encourages spending up to the limit. They examine a...

In this episode, Lucas and Luna dig into the curious inefficiency of government travel procurement. Federal employees' hotel rates are set by per diem allowances that haven't kept pace with real market pricing — or, paradoxically, are sometimes set so high that agencies overpay. The hosts walk through the General Services Administration's system for setting lodging maximums, how it creates pervers...

Episode 81 of Government Spending with Fexingo: Budget, Deficits, and Public Finance Explained. Lucas and Luna dig into a pernicious but little-understood reason why government infrastructure projects routinely blow their budgets: they consistently underestimate the cost of environmental mitigation and community compensation. Using the $4.5 billion overrun on California's high-speed rail as a conc...