Federal Accountability · Defense Spending · Granite State Impact

The Pentagon Can’t Account For $4.65 Trillion. Concord Just Cut $52 Million From Medicaid.

Eight straight failed audits. A 50 percent budget hike. And a New Hampshire National Guard wing deployed to a war nobody declared — while the only VA hospital in the state quietly hollows out.

By Dexter Dow · Granite State Report

The Pentagon has now failed eight consecutive financial audits. Not “underperformed.” Not “fell short of expectations.” Failed — every single year since Congress started requiring the audits in 2018. The Department of Defense is the only major federal agency that has never once passed.

The failure isn’t abstract. In the most recent audit, released in December 2025, the F-35 Joint Strike Fighter program — the most expensive weapons program in the history of the United States — could not accurately tell auditors what it owns. Not what it cost. What it physically owns, sitting in hangars and warehouses right now. The same audit logged 26 material weaknesses across the department. The Pentagon reported $4.65 trillion in assets scattered across all 50 states and more than 40 countries, and it cannot say where most of it is.

If a private company failed its audits eight years running, the Securities and Exchange Commission would lock the doors, indict the board, and frog-march the CFO past a wall of television cameras. The Secretary of Defense holds a press conference, gestures at “decades of war and neglect,” and the department asks Congress for more.

Four months later, it got the ask in writing. The Trump administration’s fiscal year 2027 budget request, released in April 2026, proposes $1.5 trillion — the largest defense budget in American history, roughly 50 percent above the combined defense spending of 2026, which had already crossed $1 trillion for the first time. More money than the institution has ever received, handed to the one agency that cannot account for what it already has.

The Track Record

Iraq. Twenty years. $815 billion in direct appropriations. The United States removed Saddam Hussein, dissolved the Ba’athist army, handed effective control of Baghdad to Iran-aligned militias, and watched ISIS rise out of the rubble. The goal was a stable, pro-American democracy. What we built was a failed state and a recruiting engine for the next war.

Afghanistan. Twenty years. $2.3 trillion in total war costs. The Special Inspector General for Afghanistan Reconstruction — SIGAR, the federal watchdog Congress chartered in 2008 to track every dollar — issued its final report in December 2025 before being dissolved. It documented $148 billion in reconstruction spending, of which between $26 billion and $29 billion went to confirmed waste, fraud, and abuse across 1,327 individual cases. The United States spent $7.3 billion specifically trying to stop Afghan opium production. Afghanistan finished the war as the world’s largest opium supplier.

We also fought the whole war without speaking the language. The U.S. Census counts about 22,000 Pashto speakers in the entire country, nearly half of them with limited English. ABC News, citing a whistleblower who screened translators for the Pentagon’s main interpreter contractor, Mission Essential Personnel, reported that many of the interpreters sent into the field alongside American troops could not actually speak Pashto or Dari. Radio Free Europe documented one such case in Panjwaii District in 2007: a Marine told his translator to have the Afghan army “shoot an illume” — slang for a flare to light up a target. The translator didn’t know the term. He told the Afghan unit to fire mortars instead. The mortars killed civilians in the village the patrol had been sent to protect. The translator got a verbal warning. Nobody was relieved of command.

The Iran War

Iran. Operation Epic Fury launched on February 28, 2026 — the largest U.S. military operation in the Middle East since the 2003 invasion of Iraq. Nine hundred coordinated strikes in the first 12 hours. Supreme Leader Ali Khamenei killed. His son, Mojtaba Khamenei — the man President Trump had publicly called an “unacceptable” successor — took power the same week. On May 26, 2026, Mojtaba broke months of silence to announce that no country in the region would go on serving as a launchpad for American military bases.

The actual results, pulled from classified intelligence assessments and the post-war analyses of CSIS and the Soufan Center, are not what the briefings promised. The strikes set Iran’s nuclear program back by less than six months. Half of Iran’s ballistic missile launchers survived, hidden inside roughly 30 underground bases drilled into the Zagros and Alborz mountains over the past two decades — fortifications American bunker-busters cannot reach. The Council on Foreign Relations put the odds of the campaign achieving most of its objectives at “remote.”

The opening phase alone cost $16.5 billion, burning $900 million a day at the peak. Iran’s retaliation under Operation True Promise IV hit American assets in seven countries inside 48 hours: Bahrain, Jordan, Kuwait, Qatar, Saudi Arabia, the United Arab Emirates, and Iraq. Three foreign workers died in the UAE. Dubai International shut down. Etihad grounded its fleet. The whole planet watched the most powerful military on earth kill a head of state and fail to achieve a single thing it set out to do.

The Reward Structure

A teacher whose third-graders test below grade level gets fired. A superintendent whose district fails its assessments loses the contract. A road agent who botches a snowstorm gets voted out at town meeting. For everyone who isn’t a four-star general, failure has consequences.

A general who lost a 20-year war gets a board seat at RTX — formerly Raytheon — and a podcast deal. Failed war? More money. Failed school? Defund it. Failed bridge? Tough luck. Failed empire? Have another trillion.

The total cost of the post-9/11 War on Terror, calculated by the Costs of War project at Brown University, now stands at $8 trillion and more than 900,000 deaths. Care for the four million veterans of Iraq and Afghanistan through 2050 is projected to cost another $2.2 to $2.5 trillion — most of which Congress has not yet appropriated. The American taxpayer is being billed for losses that were already taken.

The Granite State Ledger

None of this is happening to someone else. It is happening here.

In late February 2026, the Pentagon activated the 157th Air Refueling Wing of the New Hampshire Air National Guard, based at Pease Air National Guard Base in Newington and Portsmouth, and deployed Granite State airmen to the U.S. Central Command theater in support of Operation Epic Fury. Governor Kelly Ayotte confirmed the deployment on March 5, 2026, citing a classified briefing she said she could not discuss. No congressional declaration of war preceded the operation. No authorization for the use of military force was passed.

In October 2025, the House Federal and State Relations Committee voted 11-6 to kill a bill from Representative Tom Mannion of Pelham that would have required a congressional declaration of war before New Hampshire Guard units could be sent into foreign combat. The committee’s own reasoning told the story: New Hampshire risks losing nearly $400 million in federal grants if it tries to assert any authority over the deployment of its own Guard. Washington has, in effect, leased the constitutional war power back to itself, using money the state cannot afford to turn down.

Meanwhile, in Concord, the House Finance Committee cut nearly $800 million from Governor Ayotte’s proposed two-year state budget. The enacted FY2026-2027 budget — $15.89 billion across the biennium — cut Medicaid provider reimbursements by $52.5 million, cut $11.2 million from the Meals and Rooms tax money that flows to New Hampshire cities and towns, and imposed new Medicaid premiums on enrollees starting July 2026. Public health and child wellbeing programs took direct hits. Higher education got cut. The New Hampshire Fiscal Policy Institute counted reductions across 13 of the Department of Health and Human Services’ 28 sub-agencies.

The federal defense budget is not a national-security debate carried out in a vacuum. It is a budget. Every dollar moved into the Pentagon is a dollar not moved into a Medicaid reimbursement, a public school, a community mental health clinic, or a town road. New Hampshire taxpayers are not exempt from the math. They are the math.

The Manchester VA

The Manchester VA Medical Center on Smyth Road is the only VA hospital in New Hampshire, and it is not really a full hospital anymore. New Hampshire is the only state in the contiguous 48 without a full-service VA facility. Ninety beds for the whole state. Anything serious — cardiac care, complex surgery, cancer treatment — gets shipped to Boston or farmed out to private providers under the VA Community Care Network.

This is not a hypothetical worry. In July 2017, 11 Manchester VA doctors went to the Boston Globe’s Spotlight team and described an operating room infested with flies, surgical instruments that weren’t reliably sterilized, and at least 80 patients with progressive spinal damage who were left using canes, wheelchairs, and walkers instead of getting the surgery that would have prevented it. The VA Secretary removed the hospital’s director and chief of staff within hours. The federal whistleblower agency found a “substantial likelihood” the allegations were true.

And the problems didn’t stop there. The building opened in 1950, and burst water pipes have shut its operating room for months at a stretch — once in 2017, again in 2022 — with winter heating failures relocating patients and cancelling appointments in between. In May 2025, the Trump administration ordered yet another feasibility study on turning Manchester into the full-service hospital New Hampshire veterans have been promised for two decades. And the Community Care Network meant to catch the overflow has spent years behind on its bills, at one point owing New Hampshire providers $134 million.

So here is the sequence. Washington activates New Hampshire’s Air National Guard for a war Congress never declared. That war creates a fresh wave of broken veterans — the injuries, the claims, the decades of care that follow. Washington then proposes handing $1.5 trillion to the one agency that cannot pass an audit, while Concord cuts the Medicaid reimbursements that keep the private providers — the ones catching everyone the VA can’t — from going under. The 157th comes home to a state with less capacity to care for its veterans than the day it shipped out.

The Question Nobody in Washington Will Answer

What is the strategy? Not the slogan. Not the budget line. The strategy. Because from a basement in Northfield it looks like ignorance, wishful thinking, and the unshakable institutional belief that brawn always beats brains. The British learned otherwise. The Soviets learned otherwise. Anyone who has ever tried to occupy Afghanistan learned otherwise.

When this war is lost — and it is being lost, in real time, by an institution that just confirmed it cannot find its own assets — Congress will declare victory anyway. Medals will be pinned. The same generals who botched it will be back on Fox and MSNBC by the end of the next fiscal quarter, explaining why we now urgently need to bomb Venezuela.

One-point-five trillion dollars. For what, exactly?

Granite State residents will get the bill regardless. They will pay it in Medicaid cuts to the services they actually use. They will pay it when their National Guard sons, daughters, and spouses ship out to wars nobody declared. And they will pay it at a VA already too small and too broke to treat the casualties the Pentagon is busy manufacturing on Iran’s behalf.

The audit reports are public. The deployment orders are public. The budget cuts in Concord are public. The only thing missing is anyone in Washington willing to explain why the math is supposed to work.

— Granite State Report