home > by publication type > daily analysis > Tracking U.S. Dollars to Iraq
Email
| Prepared by: | Lionel Beehner |
|---|
Multiple audits have uncovered misuse and waste of reconstruction funds. (AP)
The cost of combat operations in Iraq has soared above $300 billion (PDF), even as hundreds of millions of dollars still go unaccounted for. This is partly due to poor postwar planning and the handing out of uncompetitive bids to private contractors. But it is also due to the opaque budgetary process by which U.S. military and reconstruction operations in Iraq (and Afghanistan) are funded. Instead of being included in the regular annual defense budget, many of these costs are included in supplemental requests, which receive little scrutiny from Congress, as this new Backgrounder explains.
Recent attempts at congressional oversight have actually become “a painful example of how little oversight there actually is,” writes Winslow Wheeler of the Center for Defense Information. Steven M. Kosiak of the Center for Strategic and Budgetary Assessments agrees. “We are long past the point (PDF) where special supplemental appropriations, which are intended to cover the cost of unanticipated emergencies, should be used as the primary means of funding these operations,” he writes. Some experts expect with Democrats in control of at least one house of Congress, there will be increased oversight over military spending, and perhaps a shift away from relying on supplemental requests to finance combat operations in Iraq.
Meanwhile, multiple audits conducted by U.S. and other agencies point to waste and malfeasance involving funds slated for reconstruction. The most recent, conducted by a UN oversight agency, found that the Halliburton subsidiary KBR had charged the Iraqi government $25,000 per truck per month for 1,800 fuel trucks that, it turns out, sat largely unused (PDF) along the Iraqi border. The Special Inspector General for Iraq Reconstruction (SIGIR), in its quarterly audits since January 2004, has uncovered widespread corruption, incompetence, and red tape. Shoddy construction also remains a problem (a recent SIGIR report discovered human waste leaking from the ceilings of barracks used by Iraqi soldiers). Foreign Policy examines the major contracts awarded to various U.S. firms in Iraq.
To be sure, reconstruction is taking place under difficult security conditions in Iraq, but there is mounting concern about the scale of the problems. All told, U.S. taxpayers have spent some $38 billion to rebuild Iraq—though much of the country’s infrastructure remains at prewar levels and many Iraqis still lack adequate water, electricity, and heating oil. Meanwhile, Congress has sought to close SIGIR (Denver Post), which was originally established as a temporary outfit, by the end of next year (a SIGIR press spokesperson tells CFR.org its operations will be folded into the Departments of State and Defense). MSNBC calls the move a “’shoot the messenger’ coup de grace.”
So was the war worth it? It depends, says Douglas Holtz-Eakin, a former director of the Congressional Budget Office who directs CFR’s Center for Geoeconomic Studies. “War will be worth it only if the United States is ultimately safer than with a ruthless dictator still controlling Iraq,” he writes in the Financial Times, “but costs will remain an issue until such benefits become clear.” Journalist Ed Harriman, writing in the London Review of Books, reckons the war was not worth it because “the Coalition has created and fostered the least accountable and least transparent regime in the Middle East.” When all is said and done, some economists, most notably Linda Bilmes of Harvard University and Joseph E. Stiglitz of Columbia University, estimate the final war bill could top $2 trillion (PDF), based on long-term healthcare costs for wounded vets, a sagging economy due to escalating oil prices, and higher recruitment costs to replenish a damaged military.
Weigh in on this issue by emailing CFR.org.
Global Economy in Crisis
Expert Conversations on World Events
In The Closing of the American Border, Edward Alden goes behind the scenes to tell the story of the Bush administration’s struggle to balance security and openness in the wake of the September 11, 2001, terrorist attacks.
In Termites in the Trading System, Jagdish Bhagwati reveals how the rapid spread of preferential trade agreements endangers the world trading system.
America Between the Wars explores how the decisions and debates of the years between the fall of the Berlin Wall and the collapse of the Twin Towers shaped the events, arguments, and politics of the world we live in today.
Complete list of CFR Books.
This report lays out a thoughtful agenda for U.S. policy toward the Democratic Republic of Congo, arguing that what happens there should matter to the United States--for humanitarian reasons as well as economic and strategic ones.
In this report, CFR Senior Fellow Michael A. Levi analyzes the potential use of deterrence in preventing terrorist groups from acquiring nuclear weapons and recommends a new approach to U.S. declaratory policy, as well as ways to improve U.S. capabilities to determine the sources of terrorist attacks.
Complete list of Council Special Reports.
This report argues that the United States must lead with domestic action on climate change and proposes a U.S. negotiating strategy for a global UN climate agreement that includes commitments from all major economies, while also promoting a less formal Partnership for Climate Cooperation that would focus the world's largest emitters on implementing aggressive emissions reductions.
This Task Force report examines changes in Latin America and in U.S. influence there, while taking account of the region's enduring importance to the United States. The Task Force offers an agenda for U.S. policy toward Latin America and identifies four critical areas that should provide the basis of a new U.S. approach.
About Independent Task Forces at CFR.
“ Minor League, Major Problems:” Charles Kupchan argues that a league of democracies would not secure cooperation among democracies and would expose the limits of the West's power and legitimacy.
To order Task Force reports, Council Special Reports, and Critical Policy Choices, please call, fax, or order online from our distributor, the Brookings Institution Press: phone +1.800.537.5487, fax +1.410.516.6998.
For information on other reports that are not for sale, or for general publications information, please call +1-212-434-9516 or email publications@cfr.org.
To request permission to reuse Council materials, please email publications@cfr.org or fax +1.212.434.9859.
Please include the complete information of the requested work—author, title, sections/pages to be copied or reprinted, and number of copies to be made—along with a brief description of where and how you would like to reuse the work.
You may also request permission for Council material through Copyright Clearance Center. For more information, please click on the link below.
Copyright 2008 by the Council on Foreign Relations. All Rights Reserved.
