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Friday, February 16, 2007

War Could Cost Over $2 Trillion -- Wouldn't it Have Been Cheaper Just to Buy Iraq?

Bush talks a lot about his big troop surge. But so far, the plan seems to be to smother sectarians in Iraq with money. After reports last week that we shipped 363 tons of $100 bills on pallets to Iraq, we learn that the Government Accountability Office as determined that we've wasted -- literally wasted -- billions in Iraq.

Associated Press:

About $10 billion has been squandered by the U.S. government on Iraq reconstruction aid because of contractor overcharges and unsupported expenses, and federal investigators warned Thursday that significantly more taxpayer money is at risk.

The three top auditors overseeing work in Iraq told a House committee their review of $57 billion in Iraq contracts found that Defense and State department officials condoned or allowed repeated work delays, bloated expenses and payments for shoddy work or work never done.

More than one in six dollars charged by U.S. contractors were questionable or unsupported, nearly triple the amount of waste the Government Accountability Office estimated last fall.

"There is no accountability," said David M. Walker, who heads the auditing arm of Congress. "Organizations charged with overseeing contracts are not held accountable. Contractors are not held accountable. The individuals responsible are not held accountable."


To date, Bush has spent more than $350 billion on reconstruction in Iraq. In testimony, investigators:

-Found overpricing and waste in Iraq contracts amounting to $4.9 billion since the Defense Contract Audit Agency began its work in 2003. Some of that money has been recovered. An additional $5.1 billion in expenses were charged without proper documentation.

-Pointed to growing Iraqi sectarian violence as a significant factor behind bloated U.S. contracting bills. Iraqi officials, they said, must begin to take primary responsibility for reconstruction efforts. That is an uncertain goal, given the widespread corruption in Iraq and the local government's inability to fund projects.

-Urged the Pentagon to reconsider its growing reliance on outside contractors in wars and reconstruction efforts. Layers of subcontractors, poor documentation and lack of strong contract management are rampant and promote waste even after the GAO first warned of problems 15 years ago.


Remember how privatization was such a good idea because the private sector was so 'efficient' and would do everything cheaper? I never really got the logic behind that one; why would a private company, which has to show a profit, do something cheaper than government, which doesn't? They say the lottery is a tax on people who are bad at math -- privatization is public policy for those same people.

That $350 billion is just for reconstruction. The war itself is costing us $5.8 billion per month ('04 figure) and could cost over $2 trillion before it's all said and done.

Here's a question. How much do you think it would've taken for Saddam to just sell us Iraq? At this point, it's pretty clear that money's no object. We could've probably done this whole world-building thing cheaper and with one hell of a lot less bloodshed.

But the really weird thing about this scenario is that it's ridiculous. Had anyone brought up a straight up purchase of Iraq, rather than an invasion, they would've been laughed off the floor of either chamber. Of course, the wisest course would've been to leave Iraq the hell alone. But that option was ridiculous too, apparently.

It's so much better to do things the free market moony way. See, the market solves all problems. Get enough cash into Iraq and the market will fix things. Let contractors deal with the cost and everything will go well. There's a 'laissez faire' approach to markets and there's a 'laissez stupid' approach. Bush opted for the latter. Throw money around without any accounting at all and it'll all wind up where it belongs -- the genius of the free market will see to it.

Keep in mind, that scenario means giving the administration the benefit of the doubt. The other possibility is that they wanted to raid the treasury to benefit their friends. The AP piece I quoted above tells us, "Of the $10 billion in overpriced contracts or undocumented costs, more than $2.7 billion were charged by Halliburton Co., the oil-field services company once headed by Vice President Dick Cheney."

But I'm sure that's just a coincidence.

So, looking at the financial mess of Iraq and leaving aside the humanitarian mess, the diplomatic mess, the strategic mess, and the global good will mess that Iraq has become, we have to assume one of two possibilities -- stupidity or corruption. Although, I suppose one doesn't rule out the other.

I'm willing to believe either and most inclined to believe both. It's like there's some furnace in the Oval Office marked 'Iraq War' and Bush and Cheney are shoveling in cash like firemen on a locomotive.

If it's all about money, then cutting it off will end it. While I agree with Russ Feingold that the congress has the power to defund the war, I'm doubtful as to whether that'll happen. Another possibility is to pull out the contractors and put in the Army Corps of Engineers.

Once the profit motive for this war is removed, the whole thing will get a lot less interesting to those few who still support it.

--Wisco


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