Payments to ghost employees. Contractors overcharging by hundreds of millions of dollars on no-bid contracts. And billions in reconstruction money gone missing. The list of reasons for an Independent War Profiteering Commission just keeps on growing.
The Pentagon’s Defense Contract Audit Agency (DCAA) disputed $263 million in charges from Halliburton subsidiary Kellog, Brown and Root for its $2.41 billion no-bid contract. Normally, the Army withholds between 55 to 75 percent of the monies flagged by the auditors.
So what did the Army do in this case? It withheld 3.8 percent of the payments. Yes, you read that correctly, 3.8 percent – meaning it paid all but $10 million of the charges in question despite the alleged corruption.
A spokesman for the DCAA told the New York Times that the decision was based on “broader business considerations” than the audits alone. A senior manager in the Defense Department translated this ambiguous statement, saying, “That’s as close as DCAA can get to saying, ‘We’re not happy with it either.’ “
Could it be that “Sure Shot” Cheney was once again right on target when it comes to helping his Halliburton friends? Never mind that the company was charging three times more than its competitors for fuel transportation costs. It was a no-bid contract, after all, so who cares about the competition?
A few weeks ago I called for an independent war profiteering commission composed of current and former public servants drawn from across the political spectrum. Frankly, the Halliburton travesties alone justify such a commission. But the problems go well beyond Dick Cheney’s former company.
Custer Battles, ordered on March 9 by a federal jury to pay $10 million in damages, is accused of bilking the government out of $50 million. Bechtel has hired three subcontractors who were fined more than $86 million in the past four years but are still somehow eligible for new contracts. And 60 Minutes revealed that $50 billion of taxpayer money – more than the entire annual budget of the Department of Homeland Security – “has gone to private contractors hired to guard bases, drive trucks, feed and shelter the troops, and rebuild the country…with little or no oversight.”
And let’s not forget that $9 billion was simply lost – that’s right, lost, gone, nowhere – by the Coalition Provisional Authority (CPA). Stuart Bowen, the inspector general for Iraq reconstruction, reported the possibility that thousands of “ghost employees” were funded and that the CPA “failed to establish financial controls and transparency.”
Sen. Patrick Leahy seems to understand why this is such an affront to all Americans. “[It’s] clear that the Bush-Cheney Administration’s approach to reconstruction in Iraq has been a formula for mischief,” Leahy said. “Waste, fraud and abuse in the name of defense is doubly destructive and doubly offensive, and it should never be tolerated. It saps resources needed by our troops and it plays the taxpayers for fools, all the while hiding under the cover of national defense.”
Leahy recently introduced the War Profiteering Prevention Act that would make these overcharges a felony punishable by up to 20 years imprisonment and fines of $1 million or twice the gross proceeds of the crime – whichever is greater. Furthermore, any person who makes false statements about these contracts could be sentenced to 10 years in prison and the same aforementioned fines.
It’s well worth supporting this legislation. But don’t hold your breath that this bill will pass. Similar legislation introduced by Leahy was already killed in 2003 by the Halliburton White House and Republican House leadership.
And while the Custer Battles verdict is encouraging, it is unrealistic to think that whistleblower action alone will uncover the extent of the war profiteering. There is one way – and one way only – to get to the bottom of this: through a War Profiteering Commission led by public servants of all stripes — Republicans, Democrats, and Independents–and let’s include former veterans and members of military families.
At this moment of great division in our nation, let’s unite against the kind of criminal and moral corruption that all decent citizens agree has no place in our nation.