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Sunday, July 30, 2006

Bechtel - As Bad for Baghdad as it was for Boston

(Keywords and tags: , , , 's work in Iraq is slightly less of a ripoff than it's work on the )

From the New York Times:

The United States is dropping Bechtel, the American construction giant, from a project to build a high-tech children's hospital in the southern Iraqi city of Basra after the project fell nearly a year behind schedule and exceeded its expected cost by as much as 150 percent.

Called the Basra Children's Hospital, the project has been consistently championed by the first lady, Laura Bush, and Secretary of State Condoleezza Rice, and was designed to house sophisticated equipment for treating childhood cancer.

Now it becomes the latest in a series of American taxpayer-financed health projects in Iraq to face overruns, delays and cancellations. Earlier this year, the Army Corps of Engineers canceled more than $300 million in contracts held by Parsons, another American contractor, to build and refurbish hospitals and clinics across Iraq.

American and Iraqi government officials described the move to drop Bechtel in interviews on Thursday, and Ammar al-Saffar, a deputy health minister in Baghdad, allowed a reporter to take notes on briefing papers on the subject he said he had recently been given by the State Department.

The United States will "disengage Bechtel and transfer program and project management" to the Army Corps of Engineers, the papers say. Bechtel, the State Department agency in charge of the work and the Health Department in Basra all confirmed that the company would be leaving the project, but the reasons are a matter of deep disagreement.

The reasons could be that Bechtel sucks and is corrupt as hell. This is the company which oversaw Boston's Big Dig fiasco. Plagued with poor planning, shoddy construction, and corruption, the project finally killed someone when concrete ceiling tiles collapsed on a driver in a tunnel.

The iraqi project was no less corrupt. According to another NYT article, "The State Department agency in charge of $1.4 billion in reconstruction money in Iraq used an accounting shell game to hide ballooning cost overruns on its projects there and knowingly withheld information on schedule delays from Congress, a federal audit released late Friday has found.

"The agency hid construction overruns by listing them as overhead or administrative costs, according to the audit, written by the Special Inspector General for Iraq Reconstruction, an independent office that reports to Congress, the Pentagon and the State Department."

The Times tells us that the revelation was hidden in the announcement that Bechtel was being dropped from the project.

According to Mother Jones:

...The audit—which was conducted by the Special Inspector General for Iraq Reconstruction, an independent office that reports to Congress and the Pentagon—found that the cost of hospital project, which was contracted out to San Francisco-based multinational Bechtel for $50 million, could, as the Times reports, "rise as high as $169.5 million, even after accounting for at least $30 million pledged for medical equipment by a charitable organization."

Actually, compared to the Big Dig, this is chump change on the corruption scale. That project, projected to cost $2.5 billion, wound up costing $14.6 billion - a 584% increase. The iraq project is a measly 339% overrun - Bechtel must be losing their edge.