So why does the government/military waste so much money at the end of the year?

Short answer is the Appropriations Act. Since funding categories carry with them finite times they can be used, each organization must expend the funds or risk dealing with a reduced budget the next year. The military isn't to blame for this, it is a curse of Federal law. I agree there is a ton of waste this causes, but until there is some incentive to save money or the funds roll over it wont change. We need changes in Federal law in order to fix this.

We have buckets of money, at the end of the year if you don't spend whats in the bucket, they assume you can do less and your bucket gets smaller. Plus, it's money thats allocated FOR spending, so if the lattitude is there, commanders spend it knowing the bucket will be topped off on 1 October.

It's a wonderful system that punishes you for saving money allocated to your budget reckoning that you obviously didn't need it. Thus you have stupid budgeting officers who for example, authorize the purchase of iPads for their "unit" for no reason except to burn up the money.