(This is the first in Matt O.’s Saturday afternoon series on war profiteering, a subject that Robert Greenwald will also be tackling in his new film Iraq For Sale: The War Profiteers.)
March 1st marked the sixty-fifth anniversary of the appointment of the Senate Special Committee to Investigate the National Defense Program, otherwise known as the “Truman Committee.” Heralded as one of the most productive committees in United States history, then-Missouri Senator Harry S. Truman chaired the effort to cut out government monetary waste on defense contracts amounting to $15 billion. Truman went as far as to proclaim that war profiteering was "treason."
Ironically, we intersect with another statement from the former president. Truman dubbed the 1948 Congress as the "Do-Nothing Congress" because they were in session for only 108 days. But I think the current collection of suits has them beat with only 97 days in session. It’s the "Do-Less-Than-Nothing" Congress and while they chase 12 million undocumented workers all over the country in the House and go off on gay-bashing tirades on the Senate floor, they are ignoring a major issue – war profiteering.
If there ever was a time when the Truman Committee was so desperately needed, that time is now. The cost of the War in Iraq recently reached $320 billion and likely to double by war’s end without adequate oversight that has led to billions missing and defense contractors running amok in Iraq.
"[Iraq] can really finance its own reconstruction, and relatively soon." -Former Deputy Defense Secretary Paul Wolfowitz, March 2003
Just days after the initial decapitation strike aimed to kill Saddam Hussein, Noelle Straub of the Boston Herald reported on March 26, 2003 that President Bush sought (and received with stipulations in April) $74.7 billion from Congress to cover the cost of the war and post-war rebuilding efforts.
Immediately, concerns were raised as non-competitive contracts were awarded to the "most politically connected" in the country. The Center for Public Integrity (CPI) told BBC News that most of the funds went to corporations or persons that were George W. Bush campaign donors in 2000. (Halliburton’s subsidiary Kellogg Brown and Root received a $7 billion contract, which Vice President Cheney claimed that he had "no influence of, involvement of, knowledge of in any way, shape or form" in the decision. However, an e-mail from Doug Feith said "We anticipate no issues since action has been coordinated w VP’s office." And if you challenge him on it, he’ll tell you to go Cheney-yourself. Talk about a major-league asshole. Big time.) Companies which the Institute of Southern Studies (ISS) dubbed the "merchants of misery." The no-bid contracts for Republican-friendly corporations were described as "looting" the federal treasury in an April 2003 editorial (May issue) in The Nation. Representatives Henry Waxman (D-California) and John Dingell (D-Michigan) questioned the bidding process at the United States Agency for International Development (USAID). The San Francisco Chronicle reported that Bechtel Corp. received a large contract worth as much as $680 million to rebuild water, sewage and power systems. In the Associated Press, Larry Margasak wrote that Bechtel would receive $34.6 million up front and could receive the higher figure pending Congressional approval.
Resistance continued to be stiff in Iraq after the President’s overdone entrance and declaration of "mission accomplished" aboard the USS Abraham Lincoln in May 2003. By August, the U.S. was spending $3.9 billion a month in Iraq.
The White House and Congress sparred over additional funds for Iraq and Afghanistan in late 2003. The Bush administration sought an $87 billion grant package while others wanted the aid to be loans. The administration won out in November but Iraq reconstruction aid was cut to slightly to $18.6 billion, according to David Firestone of the New York Times. In April 2004, Alan Fram of the Associated Press wrote that security concerns slowed reconstruction progress as "up to one-fourth of U.S. reconstruction money for Iraq is going to security." Five senators asked the General Accounting Office to investigate private security firms in Iraq:
The letter was signed by Sens. Christopher J. Dodd of Connecticut, Jack Reed of Rhode Island, Patrick Leahy of Vermont, Jon Corzine of New Jersey and Russell Feingold of Wisconsin. It underscores concerns that lawmakers have expressed in recent weeks about the contractors.
A recent review of government documents by The Associated Press found that 10 companies with billions of dollars in U.S. contracts for Iraq reconstruction have paid more than $300 million in penalties since 2000 to resolve allegations of bid rigging, fraud, delivery of faulty military parts and environmental damage.
The United States is paying more than $780 million to one British firm that was convicted of fraud on three federal construction projects and banned from U.S. government work during 2002. (emphasis mine)
And I ask you, where are the investigations? Still, nothing.
In late April 2004, Deputy Defense Secretary Paul Wolfowitz told the House Armed Services Committee that the war in Iraq was costing $4.7 billion a month. By June 2004, over $5 billion in reconstruction contracts were awarded for work in Iraq, Matt Duffy of the New York Sun reported, but the "PMO [Program Management Office] says about $2 billion worth of work is actually under way." Two months later, an audit by the Coalition Provisional Authority’s Inspector General revealed that $8.8 billion was missing.
Surely, after reports of the CPA throwing their hands up and saying "Err I don’t know" as to where almost $9 billion went, the Congress would get to the bottom of it. Perhaps… if they knew about it. According to Al Franken, Virginia Senator, 2008 Republican presidential hopeful and accused violent racist George Allen didn’t even know the money was missing and he’s on the Senate Foreign Relations Committee. Go figure.
With the news of a $855 billion deficit forecasted for the next decade by the Congressional Budget Office, President Bush approached Congress to fund a $81.9 billion supplement that included funds for the two wars, the new Director of National Intelligence and a new U.S. Embassy in Baghdad. The embassy is roughly the size of the Vatican City. [What's good for the Pope is good for the U.S. Ambassador to Baghdad, right? Obviously persons of equal stature.]
In July 2005, the Washington Post reported that, for some projects, as much as 36 percent of appropriated funds are diverted for security purposes. By late 2005, reconstruction funds were quickly drying up as the insurgency still raged in Iraq.
"For war, billions more but no more for the poor." -Reverend Joseph Lowery, February 2006
CBS’ 60 Minutes reported in February 2006 that contracts went to corporations "with little or no oversight." The second-in-command of the Coalition Provisional Authority’s Ministry of Transportation Frank Willis said that the accounting system was "nonexistant."
The next week, President Bush submitted a request for more money – $72.4 billion. David S. Cloud of the New York Times reported that the supplemental request would push the "total price tag for the Iraq and Afghanistan wars to almost $400 billion." It included $65.3 billion for military operations, $4.2 billion for reconstruction and $1.9 billion "would go to research and fielding of equipment to help troops detect and defuse homemade bombs, the leading cause of American casualties." [They are just now getting to this?] The figure "does not include $50 billion for war costs that the White House plans to ask for soon for the first months of the 2007 fiscal year."
The Senate is currently debating the emergency spending bill on the heels of a recent GAO study that had troubling conclusions on the progress of the war and the black holes that large chunks of government funds wind up. Oil, water and electricity are all below pre-war levels and now the conflict has devolved into "sectarian strife" – the buzz word of the media at large but known to the rest of us as a "civil war," one that is not like the U.S. Civil War, Rummy informs us.
It was reported days ago that the cost of the war is fast approaching $10 billion a month while yearly expenditures have doubled since the invasion and are outpacing annual expenses of the Vietnam War.
It is not to say no one has ever tried to rein in contractors but ultimately they are shrugged off by the powers-that-be in Congress. Senate Minority Whip Dick Durbin (D-Illinois) and Senator Larry Craig (R-ID) tried to reconvene the Truman Commission without success. In 2005, a largely party-line vote of 224-196 blocked efforts to resurrect a 21st century reincarnation of the Truman Committee in the House. The refusals to investigate bewilder me. I cannot help but to ask…
Why are we not zealously investigating this?
Why is it that politically-connected corporations are allowed to loot the federal treasury with impunity?
Why are the Vice President’s buddies giving our soldiers contaminated water and not hauled before a Congressional committee because of it? Please explain to me how that "supports our troops" because I’m simply not seeing it.
Why are companies like Halliburton allowed to price gouge the government without consequence? *cough* ExxonMobil, Chevron, Shell, BP *cough*
Why are companies hiring foreign nationals (as opposed to Iraqis) and paying them slave wages? Just how does that help spread our brand of democracy?
Perhaps some members of Congress didn’t realize that supporting the troops entailed more than just sporting the standard U.S. flag lapel (or two), a yellow ribbon slapped on the back of their gas-guzzling SUV and using our forces as background fixtures to curry favor with the American people.
The truth is that these companies are not there to fulfill America’s objective in the region. They are not there as American ambassadors of good will. They are not there out of a patriotic duty to country. Rather these bigwigs at Bechtel and Halliburton are in Iraq out of corporate greed and are dangerously cutting corners and overcharging the government to maximize profits. These "merchants of misery" inflame tensions by alienating Iraqis and put our forces at risk only to increase their bottom-line at the expense of the American taxpayer. Period.
War profiteering is not a partisan issue (or at least it shouldn’t be). Even our frothing friends at LGF should be mad (if there’s enough room in their "black book of hate.") It’s bad enough these companies got no-bid contracts that could have gone to local Iraqi companies for a fraction of the cost because of their political connections. The last thing we want is to let them get away with it.
[Cross-posted at The Great Society]
(Image: Ray Beldner, "Money Bags" 1998)