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Spend Carefully in Iraq

Congress should hear more about who will get reconstruction funds and what they plan to do with them. Locals often can do the job more cheaply and quickly than U.S. contractors.

October 13, 2003

The White House is still operating as though only Americans can fix Iraq, by doing it in gold-plated U.S. style. Even, it appears, if Americans would do for $15 million what Iraqis could accomplish for $80,000.

President Bush is understandably eager for Congress to pass his $87-billion request for more military and reconstruction funds. A United Nations and World Bank report estimates that Iraq's economy will shrink by 21% this year. About half the population is either unemployed or underemployed; more than half relies on the government for food aid. The question is how much help Iraqis will get from the new billions.

As it debates the request, Congress should demand better information about who will get the funds and what they plan to do with them. Last Thursday, the House Appropriations Committee took modest steps to exert control, slashing extras like $50,000 garbage trucks. It also approved amendments requiring reporting on no-bid contracts and how funds are spent. In addition, lawmakers moved to prevent national security advisor Condoleezza Rice, who is exempt from being required to testify before Congress, from administering the funds.

The White House has balked at providing Congress with basic information about contracts, but oversight is key. The U.S. Agency for International Development has only 14 employees in Iraq overseeing $3 billion worth of contracts. The agency's solution? Spend $15 million more to hire another contractor, Management Services International, to help it supervise funds.

The administration's reliance on U.S. companies for rebuilding is also mistaken. Iraqis could often do the job more cheaply and quickly. Maj. Gen. David Petraeus, in charge of northern Iraq, told a congressional delegation to Iraq that U.S. engineers had estimated that rehabilitating a cement plant would cost $15 million; Petraeus got local Iraqis to get the plant not into state-of-the-art condition but up and running for $80,000.

The U.S.-led Coalition Provisional Authority identifies 115 projects in the supplemental request, but fewer than 25 mention hiring Iraqis, according to Rep. Henry A. Waxman (D-Los Angeles). Two members of the Iraqi Governing Council, Sondul Chapouk and Judge Wael Abdul Latif, the governor of Basra, say the U.S. is wildly overspending on projects that could be handled by Iraqis.

With a national deficit that will hit at least $500 billion in 2004, the White House should not be putting the interests of corporate friends like Halliburton above those of taxpayers. Iraq needs basic security, not gizmo-laden reconstruction, even if there's not so much profit for contractors in "basic."

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