According to billionaire Elon Musk's Department of Government Efficiency, the latest example of government waste is hundreds of millions of dollars in unemployment claims that are said to be fraudulent.

A significant issue arises: Federal investigators previously identified what appears to be the same fraudulent activity, occurring years prior and on a substantially larger scale.

On X, the social media site owned by Musk, DOGE recently shared results from a first look at unemployment insurance claims since 2020. They found that 24,500 people over 115 years old claimed $59 million in benefits. Also, 28,000 people aged 1 to 5 collected $254 million, and 9,700 people with birthdates in the future received $69 million from the government.

The tweet caused a reaction that you could expect, split along party lines with either doubt or support. Musk himself reacted, saying what his team discovered was "so crazy" that he read it again and again before he understood it.

"Those figures are concerning," he remarked.

However, Chavez-DeRemer could easily check with her department's own Office of the Inspector General to find out that this kind of fraud had already been reported by the same federal workers DOGE has criticized.

They are trying to create a story that says the government is bad at its job and not smart, and that they are finding problems the government missed, says Michele Evermore, who dealt with unemployment issues at the U.S. Department of Labor when Joe Biden was president. They are finding fraud that was already known about and saying they discovered it.

The Social Security Act of 1935 established unemployment benefits in federal law, but it delegated responsibility to individual states to create systems for collecting unemployment taxes, handling applications, and distributing aid.

While states largely govern their unemployment systems independently, specific relief initiatives, such as the significantly enhanced benefits implemented early in the COVID pandemic by the first Trump administration, introduce greater federal intervention and a surge of new recipients into the system.

Under normal circumstances, state unemployment systems exhibit varying levels of efficacy, ranging from highly competent to inadequate and utterly dysfunctional, as noted by Stephen Wandner, an economist at the National Academy of Social Insurance and author of "Unemployment Insurance Reform: Fixing a Broken System." The economic disruption caused by COVID-19 and the resulting surge in new claims, which states were ill-equipped to process, led to a significant increase in those systems performing "quite terribly," according to Wandner.

The COVID unemployment relief, enacted by Trump on March 27, 2020, was quickly identified as a prime target for fraudulent activities. Within a fortnight, the Department of Labor issued a memorandum alerting state officials to the heightened risk of deception, particularly citing a substantial volume of bogus claims submitted using stolen or fabricated identities.

The same memo gave states a way to protect people whose identity was stolen to get unemployment benefits illegally. The memo suggested states could make a "pseudo claim." This would record the fraud but stop innocent people from being connected to it.

These false claims led to records showing payments for very young children and people over 100 years old. The Labor Department's inspector general counted about 4,895 unemployment claims from people over 100 between March 2020 and April 2022. However, another memo from the department explained that these applications happened because states changed birth dates to protect people whose identities were used.

The 2023 memo indicates that many of the identified claims were not payments to individuals over 100 years old, but rather 'pseudo records' derived from previously detected fraudulent claims.

A spokesperson for the Labor Department did not address inquiries regarding Musk's claims, while the department provided no specifics on how it uncovered the alleged fraud or if its findings mirrored existing discoveries.

Although DOGE ostensibly examined a more extended period than federal investigators had previously, it recorded only $382 million in fraudulent unemployment claims, which was a minimal proportion of what investigators already knew.

In 2022, the Labor Department estimated that potential unemployment fraud during the COVID era amounted to over $45 billion, with the Government Accountability Office subsequently suggesting a significantly higher figure, likely between $100 billion and $135 billion.

"I doubt this information comes as a surprise to anyone," states Amy Traub, a specialist in unemployment at the National Employment Law Project. "It has been extensively covered. Numerous congressional hearings have taken place."

If DOGE's newest claims sound familiar, it's because they are similar to their earlier findings about Social Security payments to people who had died or were very old. Those claims were not true.

Consequently, DOGE serves as an inadequate communicator even in instances of documented fraud, such as with unemployment benefit applications.

Jessica Reidl, a senior fellow at the conservative think tank The Manhattan Institute, is a fiscal conservative who so relentlessly advocates eradicating federal waste that she has authored 600 articles on the topic. While she maintains that unemployment insurance fraud is pervasive, she finds it difficult to accept any conclusions drawn by DOGE, asserting that it has operated ineffectually and potentially unlawfully.

"When DOGE claims that an implausible number of deceased individuals are receiving unemployment benefits, I become skeptical," Reidl states. "DOGE's historical accuracy in such matters is questionable."

Traub asserted that the surge in unemployment fraud during the pandemic prompted states to institute updated security protocols, and she challenged why Musk's associates were highlighting past fraud as a novel issue.

Traub states, "Given that business leaders and economists are predicting a national recession, it's understandable to consider the impact on unemployment. This appears to be an assault on the credibility of a vital program, potentially aimed at eroding public backing for unemployment insurance precisely when it is most crucial."