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How US lost billions in Wild West gamble to rebuild Iraq

Discussion in 'BBS Hangout: Debate & Discussion' started by wnes, Jan 26, 2006.

  1. wnes

    wnes Contributing Member

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    How US lost billions in Wild West gamble to rebuild Iraq

    http://www.timesonline.co.uk/article/0,,7374-2010424,00.html

    The Times
    January 26, 2006
    From Tim Reid in Washington

    AN AUDIT of US reconstruction spending in Iraq has uncovered spectacular misuse of tens of millions of dollars in cash, including bundles of money stashed in filing cabinets, a US soldier who gambled away thousands and stacks of newly minted notes distributed without receipts.

    The audit, released yesterday by the US Special Inspector General for Iraq Reconstruction, describes a country in the months after the overthrow of Saddam Hussein awash with dollars, and a Wild West atmosphere where even multimillion-dollar contracts were paid for in cash.

    The findings come after a report last year by the inspector general which stated that nearly $9 billion (£5 billion) of Iraq’s oil revenue disbursed by the US-led Coalition Provisional Authority (CPA), which governed Iraq until mid-2004, cannot be accounted for.

    The huge sums in cash were paid out with little or no supervision, and often without any paperwork, yesterday’s audit found. The report found problems with nearly 2,000 contracts worth $88.1 million.

    In one case, a US soldier gambled away more than $40,000 while accompanying the Iraqi Olympic boxing team to the Philippines. In others, “one contracting officer kept approximately $2 million in cash in a safe in his office bathroom”, the report says, “while a paying agent kept approximately $678,000 in cash in an unlocked footlocker”.

    The lack of supervision had tragic consequences. A contract for $662,800 to refurbish the Hilla General Hospital was paid in full by a US official, even though the work was not finished. Instead of replacing a central lift, as demanded in the contract, workers only tinkered with the existing mechanism. Three months later the lift crashed, killing three Iraqis.

    Cash was stolen during insurgent raids but never reported, the audit found. In another case, a contractor was paid $108,140 to refurbish completely the Hilla Olympic swimming pool. The contractor simply polished some of the pumps and piping to make it look as if new hardware had been installed. The pool has never reopened.

    More than 160 vehicles worth about $3.3 million could not be traced because there was no proper documentation. Another project, a $473,000 contract to install an internet service in Ramadi, was cancelled because officials could not oversee it. But the contractor had already been paid.

    A separate congressional inquiry has uncovered the sums of cash airlifted into Iraq after the invasion. Desperate for money, and with no banking system to receive wire transfers, the CPA, led by Paul Bremer, received UN approval to fund reconstruction with $37 billion of seized Iraqi oil proceeds, most of it held in the US Federal Reserve in New York.

    Soon, large quantities of cash began arriving in Baghdad, shipped in on C17 cargo planes. The cash arrived on pallets loaded with shrink-wrapped bundles of crisp $100 bills. The parcels, which soon became known as “bricks”, were handed out “like candy”, one Democrat congressman said.

    In all, $12 billion in cash, weighing 363 tonnes, was flown into Iraq. On December 12, 2003, one single flight to Iraq contained $1.5 billion in cash, the largest single Federal Reserve payout in US history, according to Henry Waxman, the Democrat congressman who is investigated the funding.

    The US has so far spent $226 billion on the Iraq war. The CPA was allocated $38 billion in US and Iraqi funds, and spent $19.7 billion of UN-administered Iraqi oil money.

    FRITTERED AWAY

    $108,140 paid to contractor to refurbish Olympic swimming pool in Hilla. Work never done

    $662,800 paid to repair Hilla hospital. Much of work never done, including renewing central lift. Three people later died when lift crashed

    $40,000 gambled away by US soldier assigned as assistant to Iraqi Olympic boxing team on trip to Philippines

    $2 million locked in a the bathroom safe of a US official

    $678,000 stashed away in an unlocked foot locker

    $473,000 paid for internet installation in Ramadi. Work never done
     
  2. FranchiseBlade

    Supporting Member

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    I say it everytime one of these threads comes up. John Kerry was right to vote for the 87 bil before voting against it.

    He was correct both times. His vote for it mandated accountability for how it was spent. His vote against it was the vote didn't make people accountable for spending the 87 billion. Sadly he lost out and now we see the result.

    The ironic thing is that he was laughed at for the quote then and in some people who haven't learned even now.

    Too bad everyone didn't vote for the 87 billion and vote against it as well. What a lot of waste we would have saved.
     
  3. bnb

    bnb Member

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    What always gets me...is the payments for work not done. It's not unique to Iraq (or even this US admin)...but seems all too often to be the norm in mega buck government contracts.

    WTF?

    Whether the contracts are bloated, or offer value for money might be subjective....but if you're supposed to refurbish a pool...and the pool's not refurbished...why are you getting paid???

    How is this not stealing? And how hard can it be to track down the thief. He's the dude named in the contract...and the one to whom you made out the cheque.

    Crazy!
     
  4. wnes

    wnes Contributing Member

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    While Iraq is a Wild West to war profiteers, for many Iraqis, the daily violence, the lack of electricity, long gas lines and rampant corruption have become too much to bear. People from all backgrounds and socioeconomic groups flee to Jordan or other countries where they have family.

    [link to NPR's Morning Edition audio program on Iraqis' massive exodus]
     

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