February 2nd, 2009
12:30 PM ET
12 years ago

New government commission blasts Iraq waste, fraud

[cnn-photo-caption image= http://i2.cdn.turner.com/cnn/2009/images/02/02/art.webb.gi.jpg caption="'Every interested American knows that there was rampant fraud, waste, and abuse following the invasion of Iraq,' Sen. Jim Webb, D-Virginia, said."]WASHINGTON (CNN) - Citing the need to restore public trust in an inefficient and allegedly corrupt military procurement process, a new government commission Monday officially began hearings to account for billions of taxpayer dollars misspent in Iraq and Afghanistan.

"Every interested American knows that there was rampant fraud, waste, and abuse following the invasion of Iraq," Sen. Jim Webb, D-Virginia, said at the opening hearing of the Commission on Wartime Contracting in Iraq and Afghanistan.

"They all know it, and they want us to demonstrate that we're willing to do something about it not simply in terms of process but in terms of accountability."

The seven-member commission begins its work as the U.S. military prepares to cut troop levels in Iraq, but strengthen its presence in Afghanistan, where Taliban and al-Qaeda elements have made gains in recent years.

A key commission goal is to ensure that the mistakes and corruption that have plagued the Iraqi reconstruction effort are not repeated as the primary focus potentially shifts back to Afghanistan.

"The record ... is littered with too many examples of buildings unfit for use, projects that can't be maintained at original scope and cost estimates, weapons and money gone missing, and outright fraud on the U.S. taxpayer," commission co-chair Mike Thibault said.

In a symbolic gesture, the commission's opening session was held in the same Senate hearing room used by the Truman Committee, believed to have recovered billions of taxpayer dollars by investigating military profiteering during World War II.

Like the Truman Committee, led by then-Sen. Harry Truman, "the Commission on Wartime Contracting's reason for existence is to ensure that the government pays fair and reasonable prices for the goods and services that it buys to support our war fighters," Thibault noted.

"Harry Truman has been rolling in his grave for the last five years," Sen. Claire McCaskill, D-Missouri, said. "He, in fact, has been in constant motion in his grave. He is astounded that we allowed this problem to get this far out of control. This has been a massive failure. We have failed our military and we have failed the American people."

McCaskill told the commission it was "going to need a two by four" to begin fixing the situation.

The Commission on Wartime Contracting (CWC), according to its Web site, is empowered to refer any violation or potential violation of law it identifies to the Attorney General. It is required to provide two annual reports to Congress: an interim report due May 1, 2009, and a final report due by August 2010.

The CWC's opening hearing highlighted the release of a new report on abuses in the Iraq reconstruction effort.

Titled "Hard Lessons: The Iraq Reconstruction Experience," the report says, among other things, that the massive reconstruction initiative was marked by waste and failures caused by "blinkered and disjointed" pre-war planning.

"Egregious examples of fraud" in Iraq, the report concludes, "grossly overburdened" the program.

"The overuse of cost-plus contracts, high contractor overhead expenses, excessive contractor award fees, and unacceptable program and project delays all contributed to a significant waste of taxpayers dollars," the report says.

The report includes multiple examples of waste, including a "skeletal, half-built" shell of a maximum-security prison in Khan Bani Saad, which "will probably never house an inmate" even though the United States spent $40 million on the now-halted $73 million project.

The project, sarcastically called "the whale" by local Iraqi observers, is described in the report as "perhaps the single greatest project failure in the U.S. reconstruction program" in part due to "poor security and weak subcontractor performance."

Looking beyond issues of waste and corruption, the report points out that Iraqi reconstruction was also hampered by the fact that it was pursued amid a deteriorating security situation.

"Why was an extensive rebuilding plan carried out in a gravely unstable security environment? asked Stuart W. Bowen Jr., the special inspector general for Iraq reconstruction - whose oversight jurisdiction covers $50 billion in U.S. funds appropriated by Congress for Iraq.

"This question underscores an overarching hard lesson from Iraq: Beware of pursuing large-scale reconstruction programs while significant conflict continues."

The Iraq program was additionally marked by frequent changes in reconstruction strategy, "turbulence" caused by personnel turnover and "poor integration" of work by various U.S. government agencies. This was the result of "weak unity of command and inconsistent unity of effort."

Much of the "Hard Lessons" report looks to the future. It stresses the importance of developing "an agreed-upon doctrine and structure" for reconstruction "so that the United States is ready when it next must intervene in a failed or failing state."

The first of several principles mentioned for such operations: "Security is necessary for large-scale reconstruction to succeed."

- CNN's Joe Sterling contributed to this report

Filed under: Jim Webb
soundoff (108 Responses)
  1. Scott the Independent

    I've heard so much about accountability – can we get some prosecutions.

    February 2, 2009 01:01 pm at 1:01 pm |
  2. California Gold

    Gee what an underwhelming news flash this is. Accountability is a nice idea and sounds awesome, like you are a real go-getter and beacon of virtue, but there are no consequences to excesses and abuse. Accountability was what our new Attorney General likes to call simple "policy differences".

    February 2, 2009 01:05 pm at 1:05 pm |
  3. Dan

    Jim Webb is a joke.

    February 2, 2009 01:08 pm at 1:08 pm |
  4. Blake

    Guess this is one way to turn attention away from the millions wasted on pork barrel projects every year.

    February 2, 2009 01:10 pm at 1:10 pm |
  5. Helene

    Here is where our money went ! Wasted by the Bush administration. And you would think the Republicans learned their lesson ? No. They want more of the same ...

    February 2, 2009 01:11 pm at 1:11 pm |
  6. PE

    I 2nd that Scott!!!!!!

    February 2, 2009 01:13 pm at 1:13 pm |
  7. mission accomplished?

    Its time to get some orange jumpsuits out and put the high price crooks behind bars.Im with you Scott.

    February 2, 2009 01:14 pm at 1:14 pm |
  8. Baze

    The money wasn't wasted, it went into the pockets of companies that didn't provide service. Sue all these punks and send them to jail!!!

    February 2, 2009 01:14 pm at 1:14 pm |
  9. Bev

    Shameful! To say nothing of the inadequate protection and care of our troops. Shameful! All under whose watch? Shameful. I once wrote President Bush asking him when his daughters were planning on joining the National Guard. Since he was so willing to send my son to Iraq, I figured he would be just as eager to send his daughters there. He never answered my query. Think he knew something he wasn't telling the rest of us? Ya think?

    February 2, 2009 01:15 pm at 1:15 pm |
  10. Jon Davis

    We need a special prosecutor to investigate who in the Bush administration and its circle of corporate allies STOLE hundreds of billions of dollars of US taxpayer monies that were supposed to be used to re-construct Iraq while US troops literally died due to a lack of material support.

    February 2, 2009 01:18 pm at 1:18 pm |
  11. Blue VA

    I'm so proud to have Sen. Webb acting on behalf of Virginians. I know him and Se. Warner will do a great job in D.C.

    February 2, 2009 01:19 pm at 1:19 pm |
  12. Marie ..the independent

    Scott :
    I agree, lets see real prosecutions, and some of Iraq's "lost" money, refunded to uS..I hear they had a LOT of money, that "seems" to have disappeared...

    February 2, 2009 01:20 pm at 1:20 pm |
  13. mel

    Awesome. They need to do this with every branch of government in which contractors are involved. I have a hunch that privatization of government services has NOT let to efficiency and lowered costs, but rather the opposite.

    Now can we investigate:
    – Health Care: BC/BS, Aetna, etc = Medicare/Medicaid contractors
    – Military: Blackwater, Halliburton, Lockheed Martin, Boeing, etc
    – Agriculture: Monsanto, AMD, and energy co's (corn ethanol)
    – Dept Interior: mining companies, oil&gas companies
    – Treasury & Fed: people who own stock in hedge funds, brokerages, banks should NOT be elected to oversee these institutions
    – Dept Justice: anyone with ties to prison-building industry needs to GET OUT – it's a conflict of interest.

    What part of "conflict of interest" do these guys not understand?

    February 2, 2009 01:21 pm at 1:21 pm |
  14. Rick in WA

    Scott – Something interesting to watch for as far as prosecutions - If Dems are certain that none of their own can be implicated, then they will seriously consider prosecutions of the Republican culprits. If there was complicity across both parties, there will be no prosecutions.

    February 2, 2009 01:24 pm at 1:24 pm |
  15. naqib

    Several Billion...

    Dang... Obama is blowing 800 Billion on paybacks his first month in... a very large amount of which has nothing to do with jobs...

    So what else is new... same circus... just new clowns

    February 2, 2009 01:25 pm at 1:25 pm |
  16. Matt

    This is gonna be sweeeeeet....I foresee many a GOPer getting fitted for an orange jumpsuit by the end of the year.

    February 2, 2009 01:25 pm at 1:25 pm |
  17. Farrell, Houston, Tx


    February 2, 2009 01:25 pm at 1:25 pm |
  18. Joshua College Station Texas

    Yes, the waste and abuse was disgusting. Those who stole from the American people by abusing the system should be prosecuted and put in prison.

    February 2, 2009 01:25 pm at 1:25 pm |
  19. Kelly

    Finally! I have had enough of financing Darth Cheney's buddies at Halliburton.

    February 2, 2009 01:25 pm at 1:25 pm |
  20. arivera

    The Iraq war is responsible for so much of our economic woes. Yet the so called liberal media never says a word about it. The media is not liberal they are corporate owned and that means republican. The country is changing though and wants some accountability after the last 8 years. The fraud that has gone on under the last administration was criminal. I personally would like to see republicans and democrats alike that turned a blind eye to be held responsible.

    February 2, 2009 01:28 pm at 1:28 pm |
  21. Kim, Charlotte, NC

    Arrest Bush!

    February 2, 2009 01:29 pm at 1:29 pm |
  22. Wide Awake American, recently Laid-off

    Go Webb, Go

    The cata outta the bag, the milk is spilt, the lights are on from here on out.

    there is no harm the truth can bring that the lies already havent.


    Shake it up.....and shake it out

    Citizens are watching, waiting, and are Wide Awake

    February 2, 2009 01:31 pm at 1:31 pm |
  23. Bushed

    And who was our commander in chief while all of this mis-management was occuring????

    February 2, 2009 01:31 pm at 1:31 pm |
  24. walleye

    Im would think a lot of the "mis-spent" funds went to Haliburton.

    February 2, 2009 01:31 pm at 1:31 pm |
  25. bill


    February 2, 2009 01:32 pm at 1:32 pm |
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