#1004 - Sam Corcos - Inside DOGE, The IRS & How to Scam the US Government

Overview

This episode dives into the inner workings of the U.S. government, focusing on inefficiencies, systemic challenges, and the efforts of Sam Corcos, Chief Information Officer of the Treasury Department, to modernize IT systems and improve operations. It explores the Department of Government Efficiency (DOGE), the IRS, and the broader implications of government dysfunction, while highlighting the tension between entrenched bureaucracy and the push for reform.

Notable Quotes

- The IRS has about 108 competing sources of truth. It’s the most complex Rube Goldberg machine I’ve ever seen. – Sam Corcos, on the IRS’s data integrity issues.

- The biggest surprise is that executive orders are not self-actualizing. Just having the policy is a very small part of the work. – Sam Corcos, on the challenges of implementing government directives.

- The most common way to get a poor performer off your team in government is to promote them. – Sam Corcos, on the dysfunction of civil service performance reviews.

🖥️ The Dysfunction of Government IT Systems

- The IRS’s IT systems are outdated, with 60+ systems that don’t communicate and 108 competing data sources. This fragmentation leads to inefficiencies like manual reconciliation of data.

- Legacy systems, such as mainframes, are often still functional but poorly integrated with modern needs.

- The government’s procurement process is cumbersome, with contracts often contested, delayed, or inflated by vendors. For example, a vendor initially charging $2M later demanded $100M for the same project.

- Shadow IT systems have proliferated as departments lose confidence in centralized IT, creating further fragmentation.

📜 Bureaucracy and Resistance to Change

- Many government roles are tenure-based, leading to unqualified individuals in critical positions. Promotions are often used to sideline underperformers.

- The civil service system, designed to prevent political patronage, now makes it nearly impossible to fire poor performers.

- Resistance to change is deeply ingrained, with inertia and outdated processes (e.g., reliance on fax machines) stalling modernization.

- Even when executive orders are issued, implementation is slow due to bureaucratic bottlenecks and lack of accountability.

💰 Government Spending and Waste

- The IRS spends billions annually on IT, yet inefficiencies abound. For example, $500M is spent yearly on paper processing, despite available digital solutions.

- Contract reviews revealed that some vendors were being paid millions for services no longer used. One cybersecurity contract continued for years without any deliverables.

- The government’s inability to pay competitive salaries for technical roles leads to reliance on overpriced contractors, who often exploit the system.

🛠️ DOGE’s Role in Reform

- DOGE aims to cut waste, improve efficiency, and modernize systems. Corcos’s team has saved billions by canceling unnecessary contracts and reallocating resources.

- A key focus is improving the IRS’s data integrity, with a goal to unify systems and eliminate redundancies within three years.

- DOGE’s efforts have faced skepticism and resistance, partly due to poor optics and media narratives framing the group as reckless or unvetted.

👨‍💻 The Human Factor in Government Efficiency

- Recruiting and retaining technical talent is a major challenge due to low government salaries and rigid hiring processes.

- The IRS’s hiring process excludes engineers from evaluating candidates, leading to mismatches in technical roles.

- High-performing civil servants often stay out of a sense of duty, despite systemic frustrations.

- Corcos emphasizes the need for technical leadership and performance-based evaluations to drive lasting change.