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Study Finds Billions Wasted In Funds Used To “Rebuild” Iraq

In addition to the money it actually cost to fight the Iraq War and station American troops there from 2003 through 2011, which according to some estimates amounted to upwards of $1 Trillion for the entire eight year period, the United States also spent, and indeed continues to spend, billions of dollars to rebuild the country’s fractured infrastructure.  Even though our troops have been out of the country for nearly a year and a half,  Now, as we approach the tenth anniversary of the start of the war, a new study finds the Iraqi reconstruction process filling with waste, fraud, and abuse:

Ten years and $60 billion in American taxpayer funds later, Iraq is still so unstable and broken that even its leaders question whether U.S. efforts to rebuild the war-torn nation were worth the cost.

In his final report to Congress, Special Inspector General for Iraq Reconstruction Stuart Bowen’s conclusion was all too clear: Since the invasion a decade ago this month, the U.S. has spent too much money in Iraq for too few results.

The reconstruction effort “grew to a size much larger than was ever anticipated,” Bowen told The Associated Press in a preview of his last audit of U.S. funds spent in Iraq, to be released Wednesday. “Not enough was accomplished for the size of the funds expended.”

In interviews with Bowen, Prime Minister Nouri al-Maliki said the U.S. funding “could have brought great change in Iraq” but fell short too often. “There was misspending of money,” said al-Maliki, a Shiite Muslim whose sect makes up about 60 percent of Iraq’s population.

Iraqi Parliament Speaker Osama al-Nujaifi, the country’s top Sunni Muslim official, told auditors that the rebuilding efforts “had unfavorable outcomes in general.”

“You think if you throw money at a problem, you can fix it,” Kurdish government official Qubad Talabani, son of Iraqi president Jalal Talabani, told auditors. “It was just not strategic thinking.”

The abysmal Iraq results forecast what could happen in Afghanistan, where U.S. taxpayers have so far spent $90 billion in reconstruction projects during a 12-year military campaign that, for the most part, ends in 2014.

Shortly after the March 2003 invasion, Congress set up a $2.4 billion fund to help ease the sting of war for Iraqis. It aimed to rebuild Iraq’s water and electricity systems; provide food, health care and governance for its people; and take care of those who were forced from their homes in the fighting. Fewer than six months later, President George W. Bush asked for $20 billion more to further stabilize Iraq and help turn it into an ally that could gain economic independence and reap global investments.

To date, the U.S. has spent more than $60 billion in reconstruction grants to help Iraq get back on its feet after the country that has been broken by more than two decades of war, sanctions and dictatorship. That works out to about $15 million a day.

And yet Iraq’s government is rife with corruption and infighting. Baghdad’s streets are still cowed by near-daily deadly bombings. A quarter of the country’s 31 million population lives in poverty, and few have reliable electricity and clean water.

Here are just a few examples of where things went wrong:

—In Iraq’s eastern Diyala province, a crossroads for Shiite militias, Sunni insurgents and Kurdish squatters, the U.S. began building a 3,600-bed prison in 2004 but abandoned the project after three years to flee a surge in violence. The half-completed Khan Bani Sa’ad Correctional Facility cost American taxpayers $40 million but sits in rubble, and Iraqi Justice Ministry officials say they have no plans to ever finish or use it.

—Subcontractors for Anham LLC, based in Vienna, Va., overcharged the U.S. government thousands of dollars for supplies, including $900 for a control switch valued at $7.05 and $80 for a piece of pipe that costs $1.41. Anham was hired to maintain and operate warehouses and supply centers near Baghdad’s international airport and the Persian Gulf port at Umm Qasr.

— A $108 million wastewater treatment center in the city of Fallujah, a former al-Qaida stronghold in western Iraq, will have taken eight years longer to build than planned when it is completed in 2014 and will only service 9,000 homes. Iraqi officials must provide an additional $87 million to hook up most of the rest of the city, or 25,000 additional homes.

—After blowing up the al-Fatah bridge in north-central Iraq during the invasion and severing a crucial oil and gas pipeline, U.S. officials decided to try to rebuild the pipeline under the Tigris River at a cost of $75 million. A geological study predicted the project might fail, and it did: Eventually, the bridge and pipelines were repaired at an additional cost of $29 million.

—A widespread ring of fraud led by a former U.S. Army officer resulted in tens of millions of dollars in kickbacks and the criminal convictions of 22 people connected to government contracts for bottled water and other supplies at the Iraqi reconstruction program’s headquarters at Camp Arifjan, Kuwait.

There are, no doubt, more examples beyond these, and similar examples that will be eventually found in Afghanistan when the time comes. It once again raises the question of what in the world we were fighting for.

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About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May, 2010 and also writes at Below The Beltway. Follow Doug on Twitter | Facebook

Comments

  1. legion says:

    Dirty F*cking Hippies: 12,564
    Neo-Cons: 0

    We were right about _everything_.
    They were wrong about _everything_.
    You will not be allowed to forget this.

    Highly-rated. Helpful or Unhelpful: Thumb up 29 Thumb down 1

  2. PJ says:

    It once again raises the question of what in the world we were fighting for.

    To line the pockets of war profiteers.

    Highly-rated. Helpful or Unhelpful: Thumb up 22 Thumb down 0

  3. C. Clavin says:

    This is well in line with original Bush Administration estimates of $50 Billion to fund the entire invasion and occupation.
    Greatest foreign policy blunder in our history.
    Good on all of you who supported this debacle. You know who you are.
    I bet y’all think you have superb judgement in spite of how f’ing wrong you were…don’t you?
    You don’t. You are an idiot.

    Highly-rated. Helpful or Unhelpful: Thumb up 17 Thumb down 1

  4. PJ says:

    $60 billion in American taxpayer funds

    Over 10 years, that’s $685,000/hour.

    Which means that each hour would fund seven White House calligraphers for a year.
    Or you could fund the three calligraphers currently working in the White House for 10 years for only four hours of Iraqi rebuilding…. And you would get a lot more in return…

    Now, go read the utterly stupid comments by “conservatives” in the calligraphy thread…

    Like or Dislike: Thumb up 13 Thumb down 1

  5. john personna says:

    There are, no doubt, more examples beyond these, and similar examples that will be eventually found in Afghanistan when the time comes. It once again raises the question of what in the world we were fighting for.

    You know, I don’t think rhetorical questions really take us that far down the road.

    Like or Dislike: Thumb up 3 Thumb down 0

  6. bill says:

    @C. Clavin: wow, look who voted for it in the senate!

    biden, feinstein, kerry,, reid, schumer……. are they who you’re talking about?!

    Like or Dislike: Thumb up 1 Thumb down 7

  7. Rafer Janders says:

    Meanwhile people are outraged that the White House employs three (three!) calligraphers! It’s giving jobs to Americans and paying them money in exchange for labor, money which they will spend in their local communities!

    We used to say millions for defense, not on penny for tribute. Now I suppose it’s trillions for offense, not one penny for Americans.

    Like or Dislike: Thumb up 10 Thumb down 1

  8. C. Clavin says:

    Yeah bill…and you you dumb f***

    Like or Dislike: Thumb up 9 Thumb down 2

  9. swbarnes2 says:

    It once again raises the question of what in the world we were fighting for.

    Come on. Parsons Delaware knows, and James, you know that they do.

    Like or Dislike: Thumb up 1 Thumb down 0

  10. Tony W says:

    Thank goodness we have our beloved party of fiscal responsibility – always* on guard against deficits and government spending!

    *since early 2009

    Highly-rated. Helpful or Unhelpful: Thumb up 16 Thumb down 0

  11. C. Clavin says:

    And-oh-by-the-way…
    The costs of this colosal blunder are still contributing to the deficit in a massive way years later.
    The same fools who supported this debacle now like to pretend that the deficit is Obama’s fault.
    So they are still wrong…all over again.
    http://cloudfront.mediamattersaction.org/static/images/CBPPdeficitdrivers.jpg

    Like or Dislike: Thumb up 10 Thumb down 1

  12. Woody says:

    My Google-fu isn’t working terribly well. How much of that totally-not-iron triangle-$60 billion was spent on signage for the George W. Bush Street of Gratefulness? Or the Richard Cheney Memorial Square of Admirable America? Or the Paul Wolfowitz The War Will Actually Turn A Profit Orphanage?

    My guess is the same amount that the courtier media saved on firing the “plugged in” pundits who dutifully helped sell the war (and who now demand retirees, the poor, and the sick to get “skin in the game” to lower the deficits partially incurred by their perfidy).

    Like or Dislike: Thumb up 4 Thumb down 0

  13. JKB says:

    But the important lesson is that we should always trust government technocrats to manage infrastructure and the economy, because they’d never let such waste and fraud to happen. Oh, wait…who was in charge of overseeing these projects?

    And no, the presence of private contractors does not mean this was either free enterprise or capitalism. It is cronyism and government mismanagement, as well as failure by government employees to implement effective internal controls.

    Like or Dislike: Thumb up 2 Thumb down 9

  14. Mikey says:

    Since the invasion a decade ago this month, the U.S. has spent too much money in Iraq for too few results.

    That has to take the cake for Most Obvious Statement of the Year (So Far).

    And in addition to the money…over 4,000 American lives and untold Iraqi lives.

    Like or Dislike: Thumb up 6 Thumb down 0

  15. Franklin says:

    Study Finds Billions Wasted In Funds Used To “Rebuild” Iraq

    I’d like a study that shows studies often find the blindingly obvious.

    Like or Dislike: Thumb up 2 Thumb down 0

  16. Rafer Janders says:

    @JKB:

    Oh, wait…who was in charge of overseeing these projects?

    The Bush regime.

    Highly-rated. Helpful or Unhelpful: Thumb up 15 Thumb down 0

  17. Rafer Janders says:

    Does this $60 billion figure include the $9 billion in U.S. taxpayer money that was “lost” (read: stolen) by the Bush regime?

    Audit: U.S. lost track of $9 billion in Iraq funds

    Monday, January 31, 2005 Posted: 0412 GMT (1212 HKT)

    WASHINGTON (CNN) — Nearly $9 billion of money spent on Iraqi reconstruction is unaccounted for because of inefficiencies and bad management, according to a watchdog report published Sunday.

    An inspector general’s report said the U.S.-led administration that ran Iraq until June 2004 is unable to account for the funds. “Severe inefficiencies and poor management” by the Coalition Provisional Authority has left auditors with no guarantee the money was properly used,” the report said.

    “The CPA did not establish or implement sufficient managerial, financial and contractual controls to ensure that [Development Fund for Iraq] funds were used in a transparent manner,” said Stuart W. Bowen Jr., director of the Office of the Special Inspector General for Iraq Reconstruction.

    Like or Dislike: Thumb up 5 Thumb down 0

  18. gVOR08 says:

    Wiki lists the population of Iraq at 31 million and GDP at 143 billion. 60 billion a year in reconstruction is 42% of GDP or $1900 per capita. A trillion to fight the war is 7 years of GDP. Stiglitz and Bilmes put the cost closer to 3 trillion with indirect costs, or 21 years of GDP. We could literally have bought the place for that kind of money.

    It once again raises the question of what in the world we were fighting for.

    I think we fought it to lift the sanctions so they could export oil, to shovel money at a long list of contractors/contributors, and to get W reelected. What did you think it was for?

    Like or Dislike: Thumb up 7 Thumb down 0

  19. legion says:

    @JKB:

    It is cronyism and government mismanagement, as well as failure by government employees to implement effective internal controls.

    No.

    I’m certainly happy to point out how astoundingly inefficient cronyism and crooked programs are, but that’s not what happened here. The Bush administration went off and did whatever they damn well wanted, in direct opposition to all evidence, sanity, and morality. They destroyed our economy and directly caused the untimely deaths of countless thousands of people, and there was never even a shred of a chance the result would be worth either the blood or the treasure. None. We knew that from the very beginning.

    If someone said “I’m gonna spend half our GDP for the next 10 years building a giant golden turd!” it wouldn’t matter how well the project is overseen or how good the internal controls are – it’s never gonna be anything other than a giant turd.

    Like or Dislike: Thumb up 10 Thumb down 0

  20. anjin-san says:

    Why do conservatives love infrastructure spending in Iraq and hate it in America?

    Like or Dislike: Thumb up 10 Thumb down 1

  21. bill says:

    @C. Clavin: thanks for showing your true colors, again. like iraq is the only reason obama can’t right the ship……going on 5 years now.

    Like or Dislike: Thumb up 0 Thumb down 8

  22. C. Clavin says:

    bill…
    Did you look at the graphic? Are you capable of deciphering something like that? Pictures usually help folks like you.
    You are right…It’s not just Iraq…it’s also the bush tax cuts, the medicare entitlement expansion bush pushed through, and the massive economic contraction bush presided over.

    Like or Dislike: Thumb up 7 Thumb down 0

  23. Tyrell says:

    There should be no commitment to rebuild Iraq. I remember one time when there was talk of the US
    “rebuilding” North Vietnam. That would have been okay if they used a bunch of B52’s to “rebuild” it.

    Like or Dislike: Thumb up 0 Thumb down 7

  24. anjin-san says:

    That would have been okay if they used a bunch of B52′s to “rebuild” it.

    Why?

    Does the thought of some guys who are not you risking their lives and their freedom to kill people who were not a threat to the national security of the United States somehow make you feel more like a man than nature made you?

    Like or Dislike: Thumb up 10 Thumb down 0

  25. john personna says:

    I think the neocon vision, of an Iraq in our dream-image, was really stupid. That said, it wasn’t really evil to give Iraq water treatment plants and etc. Those were good things. Sadly elements in Iraq preferred to blow up their own water treatment than to take it as a gift. Sadly, whatever fraction welcomed good water could not prevent that.

    That was pretty much when reconstruction was lost.

    Nothing we could do could overcome insurgents ready to ruin themselves to “win.”

    Like or Dislike: Thumb up 0 Thumb down 0

  26. Tsar Nicholas says:

    Sun rises in east.

    Any time the government spends money there will be fraud, waste and abuse. Every time. Without fail. Literally at a 100% ratio. Whether the money is used to “rebuild” Iraq, or to pay medical expenses of the “poor” or the elderly, or to pay for ‘stimulus projects,” or to pay for SEC, EEOC, DOL, NLRB or OSHA investigations, or to subsidize housing, or to pay farmers not to grow food, or to pay the salaries of government bureaucrats. Makes no difference. If the government spends one dollar a large percentage of that one dollar proverbially will be pissed down the toilet.

    The irony is that a liberal instantly will accept the headline of this blog post — as if it were handed down on a stone tablet — but then in the very next breath reflexively fight tooth and nail against the obvious underlying and bigger-picture points about government largesse. Without grasping the irony.

    As far as Iraq goes, the war made sense. The execution of the war did not. And that’s not merely hindsight being 20/20.

    It was crystal clear from the get-go they didn’t have enough troops. It also was crystal clear from the get-go that buying into the ideas of the likes of Cheney, Rumsfeld, Kristol, Barnes & Co. — that it would be a cakewalk and we’d be in and out like Flynn — was questionable if not complete malpractice. Prepare for the worst, hope for the best. That it took until 2006 for them to figure things out — the gloves needed to come off and we needed a lot more troopers — boggles the mind. And “nation building” is a fool’s errand.

    What we should have done is taken down the regime, annihilated the Sunni-terrorist centers with the Sherman/Dresden approach, then rebuilt Iraq’s oil industry, even at the expense of other infrastructure and services, and then had them pay us back out of their ensuing oil profits for our out of pocket costs.

    Like or Dislike: Thumb up 1 Thumb down 3

  27. john personna says:

    @Tsar Nicholas:

    You seem to be going for some idiotic generality, as in, “everything has waste, including mosquito eradication.”

    The only problem is that it leads to further idiocy, like “so let’s just have mosquito.”

    Education has waste, so no education. On and on.

    And if that isn’t where you were going, what the heck was your point?

    Do you think public health and education are as wasteful as the Iraq adventure? Apples and apples?

    Like or Dislike: Thumb up 4 Thumb down 0

  28. Rusty Shackleford says:

    @legion:
    They have already forgotten this, take a glance at Neo-con blogs and commentary. The important thing is that independents and those that are open to convincing never forget it.

    Like or Dislike: Thumb up 1 Thumb down 0

  29. bill says:

    @bill: like you need a graph to blame Bush for obamas dismal performance? since when? he knew what he was getting in to, said he could fix it and hasn’t- what’s so hard about that to understand? need a graph or some rose colored sunglasses?

    Like or Dislike: Thumb up 0 Thumb down 2

  30. wr says:

    @john personna: “Nothing we could do could overcome insurgents ready to ruin themselves to “win.” ”

    As we see again with the Teahadists in Congress…

    Like or Dislike: Thumb up 0 Thumb down 0