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War Profiteering Cost 10's of Millions in Iraq Reconstruction
Yahoo News/AP
By HOPE YEN, Associated Press Writer
January 31, 2007

WASHINGTON - Congressional Democrats on Wednesday decried tens of millions dollars of waste in Iraq reconstruction aid, as a new government report underscored a need for closer scrutiny of how the costly war is being handled.

Lawmakers in both the House and Senate said they planned hearings or legislation to address what they say is a growing problem of abuse as the Bush administration struggles to get a handle on both a spiraling war and the contractors who help run it.

"Our troops are going without even as government funds go to pay for such boondoggles as an Olympic-size swimming pool in an unused training camp," said a statement issued by the Senate Democratic Communications Center directed by Majority Leader Harry Reid, D-Nev.

"As the president is planning to send 21,500 more American service members into Iraq and asking for $1.2 billion in new reconstruction aid, Americans have every reason to question his spending priorities," it said.

The quarterly audit released Wednesday by Stuart Bowen Jr., the special inspector general for Iraq reconstruction, found the $300 billion U.S. war and reconstruction effort continues to be plagued with waste, spiraling violence and corruption.

It comes as President Bush is pressing Congress to approve $1.2 billion in new reconstruction aid as part of his broader plan to stabilize Iraq by sending 21,500 more U.S. troops to Baghdad and Anbar province.

In the House, at least two committees said they planned hearings to examine spending waste and abuse.

The new report "shows that Congress' work examining Iraqi reconstruction is far from finished," said Rep. Ike Skelton, D-Mo., chairman of the House Armed Services Committee. "The billions of U.S. taxpayer dollars sent for reconstruction have clearly not always been spent as we intended."

Rep. Henry Waxman, D-Calif., who chairs the House Oversight and Government Reform Committee, plans three days of hearings next week on Iraq contracts. One area of focus: Halliburton Co., the oilfield-services company that Vice President Dick Cheney once headed that has received millions of dollars of government contracts.

According to Bowen's report, the State Department paid $43.8 million to contractor DynCorp International for the residential camp for police training personnel outside of Baghdad's Adnan Palace grounds that has stood empty for months. About $4.2 million of the money was improperly spent on 20 VIP trailers and an Olympic-size pool, all ordered by the Iraqi Ministry of Interior but never authorized by the U.S.

U.S. officials spent another $36.4 million for weapons such as armored vehicles, body armor and communications equipment that can't be accounted for. DynCorp also may have prematurely billed $18 million in other potentially unjustified costs, the report said.

Meanwhile, nine major U.S. companies with multimillion-dollar contracts for Iraq reconstruction — including Bechtel National and Kellogg, Brown & Root Services — say they are being forced to devote 12.5 percent of their expenses for security due to spiraling violence in the region.

Calling Iraq's sectarian violence the greatest challenge, Bowen said in a telephone interview 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.

The State Department and other agencies say they are working to improve spending controls.

But former Rep. Lee Hamilton, co-chairman of the Iraq Study Group, said Bowen's report illustrates the uphill battle for the United States and the international community in their efforts to bring stability in Iraq.

"There are very, very few things that hurt our effort more in trying to succeed in Iraq than that kind of performance, because it turns all people off," Hamilton told the Senate Judiciary Committee on Wednesday.

On the Net:

Special Inspector General for Iraq Reconstruction: http://www.sigir.mil/Default.aspx

Quarterly Report: http://www.sigir.mil/reports/quarterlyreports/default.aspx

DynCorp audit: http://www.sigir.mil/reports/pdf/audits/06-029.pdf

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