More Iraq War Lies: Auditors Reveal Huge Reconstruction Cost Overruns Concealed from Congress


In a classic “take out the trash” maneuver, a federal audit released late Friday reveals, as Jamie Glanz of the New York Times reports,

“The State Department agency in charge of $1.4 billion in reconstruction money in Iraq used an accounting shell game to hide ballooning cost overruns on its projects there and knowingly withheld information on schedule delays from Congress.

(For those not familiar with the term, “taking out the trash,” means quietly dumping truly embarrassing news on Friday evening, because, to quote the “West Wing” episode that discusses the phenomena, on Saturday, “no one reads the paper.”)

Indeed, to say these findings were released at all is an overstatement, as they were buried in an audit of the Basra hospital project touted by Laura Bush and Condi Rice. The audit—which was conducted by the Special Inspector General for Iraq Reconstruction, an independent office that reports to Congress and the Pentagon—found that the cost of hospital project, which was contracted out to San Francisco-based multinational Bechtel for $50 million, could, as the Times reports, “rise as high as $169.5 million, even after accounting for at least $30 million pledged for medical equipment by a charitable organization.” The United States Agency for International Development, or AID, intentionally hid these cost overruns (as well as those for other projects) from Congress, by reclassifying them as overhead, or “indirect costs.” An AID contracting officer cited in the audit notes that the agency “did not report these costs so it could stay within the $50 million authorization.”

Bechtel is almost as notorious as Halliburton for its ties to the administration, its ability, (as we’ve reported), to game no-bid Iraq reconstruction projects, its move to (again, as we’ve reported) privatize water systems across the world, oh, and the Big Dig.

But leaving aside all that, the really ominous part of the auditors’ findings were spelled out by the Washington Post:

· There is no overall plan for transferring U.S.-initiated reconstruction projects to Iraqi government control and no schedule for when they will be completed.

· A planned first-responder network — intended to allow Iraqis to call for help in the event of emergency — is ineffective because of communications problems that prevent most dispatch centers from receiving calls from civilians. By the end of the year, more than $218 million will have been spent on the program.

· The United States has devoted little time or money to a program aimed at rooting out corruption in the Iraqi government.

But of course. Rooting out corruption would set a dangerous precedent.

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We aim to hire, build a team, and give them the time and space needed to understand how we got here and how we might get out. We want to dig into the forces and decisions that have allowed massive conflicts of interest, influence peddling, and win-at-all-costs politics to flourish.

It's unlike anything we've done, and we have seed funding to get started, but we're looking to raise $500,000 from readers by July when we'll be making key budgeting decisions—and the more resources we have by then, the deeper we can dig. If our plan sounds good to you, please help kickstart it with a tax-deductible donation today.

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Signed by Clara Jeffery

Clara Jeffery, Editor-in-Chief

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