Over $8B of the Money You Spent Rebuilding Iraq Was Wasted Outright

[Deberg_1990]

The legacy of all the money the U.S. wasted in Iraq might be summed up with a single quote. “$55 billion could have brought great change in Iraq,” Prime Minister Nouri al-Maliki recently told the U.S.’s Iraq auditor. In fact, the U.S. spent $60 billion in its botched and often fraudulent efforts to rebuild the country it invaded, occupied and recast in its image.

With the 10-year anniversary of the Iraq invasion looming, Stuart Bowen, the Special Inspector General for Iraq Reconstruction, considers $8 billion of that money wasted outright. And that’s a “conservative” estimate, Bowen tells Danger Room.

“We couldn’t look at every project — that’s impossible — but our audits show a lack of accountability,” Bowen says. “We are not well structured to carry out stability and reconstruction operations.”

That isn’t nearly the whole story of the Iraq War’s expense. Bowen is only looking at reconstruction money, not the cost of military operations in Iraq, which totaled over $800 billion. But on Wednesday, Bowen’s office released a mammoth, final report into the botched reconstruction, which cost the U.S. taxpayers, on average, $15 million every day from 2003 to 2012 — all for dubious gain.

It turns out there wasn’t just one way to waste all that money. Some projects got started and never finished, like a prison in Diyala province, shown above, that languishes unbuilt nearly nine years after the government spent $40 million to build it. Other contracts went to cronies: the top contracting officer in Hilla awarded $8.6 million to a contractor, Philip Bloom, in exchange for “bribes and kickbacks, expensive vehicles, business-class airline tickets, computers, jewelry, and other items.” Still others got needless cash infusions: one unspecified school requested $10,000 for refurbishments and got $70,000. Government contracting databases didn’t even have “an information management system that keeps track of everything built,” Bowen recounts.

“You can fly in a helicopter around Baghdad or other cities,” Iraq’s acting interior minister told Bowen, “but you cannot point a finger at a single project that was built and completed by the United States.” Shoveling money into a chaotic warzone created a “triangle of political patronage” that ensured corruption would be an “institution unto itself in Iraq,” in the view of the acting governor of the Iraqi central bank. (Iraq consistently ranks at the bottom of Transparency International’s index on corruption.) By contrast, David Petraeus, the U.S. general who led the 2007-2008 troop surge, told Bowen that reconstruction provided “colossal benefits to Iraq.”


Even projects that seemed like success stories ultimately under-delivered. Nine major reconstruction projects for Iraq’s energy infrastructure cost around $1.19 billion. By and large, they were each completed within two years of their original schedule, and are a major reason why Iraq’s energy supply stands at over 8,000 megawatts, compared to around 3,000 megawatts at the time of the invasion. The problem is, Bowen’s report finds, the estimated demand for electricity in the new Iraq is around 14,000 megawatts.

Lots of factors contributed to the misspent or missing cash. Rarely was it clear which of the alphabet soup of government agencies was in charge of the disbursement. The U.S. was overeager to hand over construction projects to Iraqis that lacked the capacity to finish them. Contractors flooded Iraq — there were nearly 174,000 contract personnel in Iraq in 2009, a larger force than the U.S. military ever fielded — but a persistent “lack of sufficient contracting personnel in Iraq weakened acquisition support, hampering project outcomes,” Bowen’s report concludes. The report considers the 2003 purge of Sunnis from the Iraqi government to be the bureaucratic equivalent of the Baghdad looting that occurred in the occupation’s early days.

Some U.S. reconstruction cash ended up being wasted during attempts to mitigate waste. A case in point was an effort the military loved, called the Commanders Emergency Response Program. As the name indicates, the program was basically walking-around-money, distributed at the discretion of military commanders, to hire Iraqis to work on short-term, high-value projects, thereby bringing economic dynamism — and an alternative to insurgency — to impoverished Iraqis.

To this day, Bowen finds, it’s impossible to say what the $4 billion program actually bought. Commanders’ record-keeping was inexact and incomplete. “This renders suspect commander narratives, academic studies, and other analyses that claim success based on that data,” the report concludes. (That includes $370 million that commanders famously used in 2007 and 2008 to pay Sunni insurgents not to fight.) Yet the program was exported to Afghanistan.

The legacy of the Iraq War, and the reconstruction effort, will be debated endlessly. One argument holds the U.S. should not attempt to destroy and then rebuild a foreign country it doesn’t understand. Bowen doesn’t go that far — “unrealistic,” he says. Agnostic on the wisdom of open-ended nation-building missions, Bowen contends that the U.S. can’t afford to do them in ad hoc ways, as experience teaches they require much greater structural oversight over the dumptrucks full of cash that they require.

But that hasn’t happened. “The U.S. government is not much better prepared for the next stabilization operation than it was in 2003,” his report laments. A bureaucratic reform Bowen pushed earlier in the Obama administration to consolidate reconstruction efforts went nowhere.

“If we don’t reform our approach to stability and reconstruction operations,” Bowen warns, “we can expect to confront once again the very significant challenges we saw in Iraq, albeit on a smaller scale.”



http://www.wired.com/dangerroom/2013...Top+Stories%29

[RedDread]

Hey did you guys hear Obama's stopping white house tours?

[Garcia Bronco]

So 40 bucks per tax payer....so a little less than a filled gas tank.

[blaise]

Funny that some Democrats are now acting like Republicans are unduly outraged over the White House tours being stopped when it's obvious that cancelling the tours was done as a political ploy to make people upset.

[Amnorix]

Anytime you have that kind of effort in that kind of situation, you're goign to have MASSIVE inefficiency. Given the timeframe and the situation, you just can't have the kind of strict oversight and controls that you would ideally like to have.

The story here isn't really "Massive waste", it's "we should expect waste/fraud to consume ~15-20% of expenditures in these kinds of situations should they ever recur".

While we can learn from it and try to be better about it during the ramp up (the Bush administration failed utterly in every way after "winning", IMHO, and this could be included on the list), you're really not going to be very efficient under those circumstances.

[JohnnyV13]

Originally Posted by Amnorix

Anytime you have that kind of effort in that kind of situation, you're goign to have MASSIVE inefficiency. Given the timeframe and the situation, you just can't have the kind of strict oversight and controls that you would ideally like to have.

The story here isn't really "Massive waste", it's "we should expect waste/fraud to consume ~15-20% of expenditures in these kinds of situations should they ever recur".

While we can learn from it and try to be better about it during the ramp up (the Bush administration failed utterly in every way after "winning", IMHO, and this could be included on the list), you're really not going to be very efficient under those circumstances.

This. No fluid situation is going to be efficient and it doesn't just apply to government. Here is another truth from someone who has worked in a couple of startups. Startups aren't going to be efficient either. Often, they are hitting some underserved market, and will have very large profit margins. Also, their operations will change very rapidly.

Consequently, you will not see efficiency until operations stabilize,

[alpha_omega]

No problem, we can just print more to replace it, right?

[BigRedChief]

The first $2 BILLION in cash that we gave the Iraqi's to put in the Iraq bank disappeared on the 2nd day it was given to the Iraqi's. Just gone. No one knew where it went, It was handed off to Joe , Joe says no I handed it off to Jim, etc. etc.? It filled a C-17. A whole C-17 filled with cash. Just disappeared.

The Bush admin used no bid contracts in Iraq more than any President had before. It was the assumption by the administration that Halliburton was the only company of providing said services so why bid on them in the first place? Wasted BILLIONS of our tax $'s on that decision. A non veiled payback to Cheney's former company.

[Comrade Crapski]

Originally Posted by BigRedChief

The first $2 BILLION in cash that we gave the Iraqi's to put in the Iraq bank disappeared on the 2nd day it was given to the Iraqi's. Just gone. No one knew where it went.

I'm still trying to figure out where the $700 billion in stimulus money went.

[frazod]

You mean the whole thing was some giant, horseshit boondoggle designed to enrich politically connected weapons manufacturers and contractors?

Gee, who knew?

[Comrade Crapski]

Originally Posted by frazod

You mean the whole thing was some giant, horseshit boondoggle designed to enrich politically connected weapons manufacturers and contractors?

Gee, who knew?

The O-Bots have run out of BS to defend Dear Leader so they're drudgeing up the ol' Iraq/hallburton crap.



LOOK! OVER THERE! A SQUIRREL!

[frazod]

Originally Posted by Comrade Crapski

The O-Bots have run out of BS to defend Dear Leader so they're drudgeing up the ol' Iraq/hallburton crap.



LOOK! OVER THERE! A SQUIRREL!

Bush doesn't get a pass for his bullshit just because Ostalin sucks worse.

We never should have invaded Iraq.

[Comrade Crapski]

Originally Posted by frazod

Bush doesn't get a pass for his bullshit just because Ostalin sucks worse.

We never should have invaded Iraq.

I hear ya. I'm just pointing out that I can't start a thread but a moonbat can start one about Iraq.

I mean, really? It hasn't already been discussed ad nauseum?

[scott free]

Originally Posted by frazod

Bush doesn't get a pass for his bullshit just because Ostalin sucks worse.

We never should have invaded Iraq.