It’s a story we’ve read over and over again since the invasion of Iraq awkwardly lurched into the long-term occupation of the country: fraud, waste and abuse by civilian contractors could have been reduced by billions of dollars if only the Pentagon had the right people in place to oversee the operation. In its final report to Congress, the Commission on Wartime Contracting said today that after three years of investigations, it has identified at least $31 billion and possibly as much as $60 billion that has been wasted in Iraq and Afghanistan on bad contracts, fraud, or contracts that were poorly planned and implemented.
In what almost reads as boilerplate to those who have been following the commission's work since 2008, the team writes that a decade into U.S. government contingency contracting operations, contractors remain “the default option because federal agencies lack the organic capacity to perform some mission-critical functions; the government also lacks the acquisition personnel and structures needed to manage and oversee an unprecedentedly large contractor force that at times has outnumbered troops in the field.”
Through the end of the 2011 fiscal year, U.S. spending on contracts and grants in Iraq and Afghanistan should top $206 billion, while the number of contract specialists employed by the government rose by only 3% between 1992 and 2009, despite “an enormous increase in contracting activity during that period.”
And the drawdowns in Iraq—and eventually Afghanistan—won’t be the end of it. Now that new schools, hospitals, roads, power plants, bridges, dams and other infrastructure has been built, it will have to be maintained. The report says that “these enduring costs risk wasting billions of dollars of American taxpayers’ money—possibly dwarfing the tens of billions in waste already incurred—if funding from the Iraqi and Afghan governments or the international donor community cannot cover them.” With serious doubts about the ability of the governments of Iraq and Afghanistan—particularly Afghanistan, whose economy is almost completely reliant on the billions that NATO and non-governmental organizations are pumping into local economies—to fund repairs and upgrades to this infrastructure, many of the projects the U.S. funded could ultimately fail. In other words, that $31-60 billion in wasted funding will almost certainly grow in coming years.
No one is blameless in this mess. Neither contractors nor government agencies can escape responsibility. As Steve Schooner, codirector of the Government Procurement Law Program at George Washington University, once told me: “Who are the baddest bad guys in the Iraq reconstruction story? They’re people like [former Defense Undersecretary Paul] Wolfowitz—the highest levels of the Defense Department, the State Department, the Agency for International Development, who made unrealistic promises, threw money at problems and refused to listen to experts who said, ‘You can’t spend money this way without managing it.’ But who gets blamed? The contractors.”
Photo: U.S. Army