At Least $8 Bil in Iraq Rehab Funds Lost To Waste, Fraud

A decade after the U.S. started the war in Iraq American taxpayers are still funding an exorbitant  “reconstruction” effort in the Middle Eastern nation and a chunk of the money—billions—has been lost to fraud and corruption.

This isn’t something that’s been widely covered because most media lost interest after the last U.S. troops left Iraq in December of 2011. Nearly 5,000 U.S. service members died and more than 32,000 were wounded in the war—George W. Bush’s war—which lasted nearly nine years and cost north of $2 trillion, according to a recent study. The same study, released on the 10^th anniversary of the U.S. invasion, estimates that the cost could eventually top $6 trillion.

That extraordinary figure doesn’t even include reconstruction, but is rather limited to actual expenditures from the U.S. Treasury during the war and future commitments such as the medical and disability claims of American veterans. An additional $60 billion has gone to post-war recovery, an ongoing initiative that has been plagued by scandal.

At least $8 billion in Iraq reconstruction funds has been wasted because of contracting abuses and mismanagement, according to the final report released by the Special Inspector General for Iraq Reconstruction (SIGIR). The transitional watchdog has published hundreds of scathing reports over the years and this month released the grand finale, a painful 186-page exposé that includes many examples of the corruption that’s plagued U.S.-funded Iraq reconstruction efforts.

Here is how some of the money was spent; north of $15 billion went to projects that supposedly improved Iraq’s power and water supply, schools, and road and housing repairs. Around $9 billion went to health care, law enforcement and “humanitarian” assistance. Uncle Sam doled out $20 billion to re-equip Iraqi security forces and around $8 billion to enhance the rule of law and crackdown on narcotics. An additional $5 billion was blown on propping up Iraq’s economy.

So, what government agency is to blame for this atrocious multi-billion-dollar waste? The Department of Defense (DOD), according to the SIGIR. That’s because it practically controlled, or at least “held decisive sway” over 87% of the money. In short, the SIGIR writes in its last report that “the U.S. reconstruction program failed to meet its goals because of poor planning, indiscriminate priorities, and insufficient consultation with Iraqi authorities.”

Just last summer the SIGIR released an equally enraging audit estimating that at least $6 to $8 billion in Iraq reconstruction funds had been lost to fraud and waste. Furthermore, that probe revealed that the precise amount lost can never be known because of poor record-keeping. A number of other audits have exposed the ongoing abuse of taxpayer dollars in Iraq reconstruction efforts. 

Congress appropriated a whopping $51.4 billion to help the country recover from the war by, among other things, training local police, building schools, hospitals and transportation systems, but much of the money has literally vanished. The funds were allocated to the DOD, the State Department and the U.S. Agency for International Development (USAID), though the DOD—especially the Army—has been the leader in handling the money.

Over the years probes have revealed that lucrative contracts never got finished, weapons and sophisticated communication equipment can’t be accounted for and that an unused police housing camp with an Olympic-sized pool and lavish trailers still sits empty in Iraq. A few years ago the Pentagon admitted that lost 6.6 billion in cash that had been flown into Iraq in turboprop military cargo planes for post-invasion reconstruction! The money was bundled in chunks of $100 bills with each aircraft carrying about $2.4 billion. The inspector general referred to it as “the largest theft of funds in national history.”