The Proving Ground: Tens of millions in U.S. reconstruction aid wasted in Iraq; GOP tried to shut down temporary agency conducting audit

Crossposted at The New Vernacular

It hasn’t made the front page of U.S. media outlets, but the Office of the Special Inspector General for Iraq Reconstruction (SIGIR) just came out with a report claiming that “Millions of dollars in US rebuilding funds have been wasted in Iraq.” BBC

The report is coming out just as President Bush is asking Congress for Congress to approve $1.2 billion in additional reconstruction aid.

The BBC cites a couple of examples of waste or funds that have gone unaccounted for:

One case involved a payment by the US State Department of $43.8m to a contractor, DynCorp International, for a residential camp for police trainers outside the Adnan Palace grounds in Baghdad. The camp has never been used.

The Iraqi Interior Ministry ordered $4.2m of work there, never authorised by the State Department, that included 20 trailers for important visitors and an Olympic-size swimming pool.

The State Department has said that it is working to improve controls.

Another example cited in the report is $36.4m spent by US officials on armoured vehicles, body armour and communications equipment that cannot be accounted for because invoices were vague and there was no back-up documentation.

On top of millions of dollars in reconstruction aid going unaccounted for, “billions of dollars budgeted for capital projects remained unspent at the end of 2006.” BBC

Democrats have picked up on the report and, “In the House, at least two committees said they planned hearings to examine spending waste and abuse.” NYT

As for the effectiveness of the money the U.S. has spent so far on reconstruction, Special General for Iraq Reconstruction Stuart Bowen said yesterday that, “billions in U.S. aid spent on strengthening security has had limited effect. He said reconstruction now will fall largely on Iraqis to manage -- and they're not ready for the task.” NYT

Even before the latest reports on U.S. spending in Iraq came out, SIGIR, “was nearly closed down last year by Republicans.” BBC

In November 2006, Republicans in the House Armed Service Committee buried a clause calling for the termination of SIGIR in a massive military appropriations bill.

In the past, the SIGIR investigations “have sent American occupation officials to jail on bribery and conspiracy charges, exposed disastrously poor construction work by well-connected companies like Halliburton and Parsons, and discovered that the military did not properly track hundreds of thousands of weapons it shipped to Iraqi security forces.” NYT

The clause was placed in the bill during a closed-door conference. There’s no denying that the elimination of SIGIR was intended to go under the radar. “The one thing I can confirm is that this was a last-minute insertion,” said Susan Collins (R-ME). NYT

With Democrats in control of Congress, the office will continue oversight of the war at least through 2008.

In case you’re wondering, Stuart Bowen isn’t some liberal watchdog bent on ruining the reputation of the Bush Administration. Before he served as Special Investigator General for Iraq Reconstruction, Mr. Bowen, “served President George W. Bush as Deputy Assistant to the President and Deputy Staff Secretary and Special Assistant to the President and Associate Counsel. He has been a partner at the law firm of Patton Boggs LLP, in its Washington, D.C. office. Before his White House tenure, Mr. Bowen served as Counsel to the Bush-Cheney transition team; and from 1994 to 2000, he held a variety of positions on Governor George Bush's staff in Texas, including Deputy General Counsel, Deputy General Counsel for Litigation, and Assistant General Counsel.” Wikipedia

Journalist Ed Harriman has been following the American audits of spending in Iraq and gave some insight on the current situation in an interview yesterday with BBC World Today Select:

BBC: Do you have a sense that the current Iraqi administration is better at keeping an eye on this type of thing than it’s predecessors?

Harriman: Oh no, not at all. And people are very distraught in Iraq at the moment because the government has become almost entirely unaccountable. What’s really interesting is that the American embassy in Baghdad seems to be unaccountable as well. And that’s after almost four years of the occupation...

BBC: Is it possible to calculate finally how much money is missing, one way or another?

Harriman: There are guesstimates because you never really get to the end of it because crooks are very good at hiding what they steal. But, we’re certainly talking about tens of billions of dollars.