Wall of Shame

The 25 Most Vicious Iraq War Profiteers

The Iraq war is many things to different people. It is called a strategic blunder and a monstrous injustice and sometimes even a patriotic mission, much to the chagrin of rational human beings. For many big companies, however, the war is something far different: a lucrative cash-cow. The years-long, ongoing military effort has resurrected fears of the so-called “military-industrial complex.” Media pundits are outraged at private companies scooping up huge, no-questions-asked contracts to manufacture weapons, rebuild infrastructure, or anything else the government deems necessary to win (or plant its flag in Iraq). No matter what your stance on the war, it pays to know where your tax dollars are being spent.

Following is a detailed rundown of the 25 companies squeezing the most profit from this controversial conflict.

1. Halliburton

The first name that comes to everyone’s mind here is Halliburton. According to MSN Money, Halliburton’s KBR, Inc. division bilked government agencies to the tune of $17.2 billion in Iraq war-related revenue from 2003-2006 alone. This is estimated to comprise a whopping one-fifth of KBR’s total revenue for the 2006 fiscal year. The massive payoff is said to have financed the construction and maintenance of military bases, oil field repairs, and various infrastructure rebuilding projects across the war-torn nation. This is just the latest in a long string of military/KBR wartime partnerships, thanks in no small part to Dick Cheney’s former role with the parent company.

2. Veritas Capital Fund/DynCorp

At first blush, a private equity fund (and not, say, Exxon-Mobil) being the number 2 profiteer in the Iraq war might sound strange. However, the cleverly run fund has raked in $1.44 billion through its DynCorp subsidiary. The primary service DynCorp has provided to the war efforts is the training of new Iraqi police forces. Often described as a ‘state within a state‘, the sizable company is headed by Dwight M. Williams, former Chief Security Officer of the upstart U.S. Department of Homeland Security. With this and other close ties to defense agencies, Veritas Capital Fund and DynCorp are well-positioned to capitalize on Iraq even more.

3. Washington Group International

The Washington Group International has parlayed its expertise the repair, restore, and maintenance of high-output oil fields into $931 million in Iraq-related revenue from 2003-2006. The publicly traded 25,000 employee company’s other specialties include the building and maintenance of schools, military bases, and municipal utilities, such as watering systems. Some have complained that Washington Group’s hefty government payoffs have served primarily to raise its trading price on the New York Stock Exchange. One thing is for sure - with oil prices continuing to rise, there will be no shortage of demand for the oil protection services Washington Group International brings to bear.

4. Environmental Chemical

All war zones eventually becomes cluttered with spent ammunition and broken/abandoned weapons, creating a lucrative niche for any company willing to clean it all up. In Iraq, this duty has fallen into the hands of Environmental Chemical. The privately held Burlingame, California company has stockpiled $878 million by the end of fiscal 2006 for munitions disposal, calling upon its “decade of experience planning and conducting UXO removal, investigation, and certification activities.” The company has close ties to several defense agencies and is staffed by graduates of the U.S. Navy’s Explosive Ordinance Schools, as well as the U.S. Army’s Chemical Schools at Anniston.

5. Aegis

Aegis has done the United Kingdom proud after reeling in a contract to coordinate all of Iraq’s private security operations. The Pentagon contract is good for $430 million (incredibly lucrative by any standard) but it has landed Aegis in some hot public relations water. The company’s decision to contribute to Iraq war efforts has lead to a rejected membership application from the International Peace Operations Association. According to The Independent, the influential trade organization does not consider Aegis worthy of inclusion in the “peace and stability industry.” It remains to be seen whether Aegis will continue to be ostracized for participating in the training of Iraqi security forces.

6. International American Products

Even with all of the blinding innovation and trailblazing advances in military technology, none of it would be very useful without electricity. Running electrical wiring in hostile war zones is dicey business, but International American Products has stuck their neck out and collected a cool $759 million in just 3 years for its efforts. While avoiding enemy fire, their work has become increasingly dangerous - and yet, critically necessary - as Coalition forces struggle rebuild cities, put down warring forces, and stabilize the chaotic nation. Schools, oils wells, and other public infrastructure have relied on IAP for the electricity needed to operate. With Iraq slowly beginning to stabilize, International American Products is holding out hope that its job will eventually become less treacherous.

7. Erinys

London-based Erinys has so far scored $136 million for its effort in securing Iraq’s precious oil reserves. Riding the coattails of its considerable mining, petroleum, and construction expertise, the company has already made considerable headway toward this critically important goal. In the space of just 16 months, Erinys successfully trained, equipped, and mobilized an all-Iraqi guard force of nearly 20,000 to protect the nation’s oil pipeline from terrorist attack or sabotage. With crude oil prices skyrocketing and no end in sight, Erinys looks to have its hands full for years to come.

8. Fluor

Fluor scored a monster $1.1 billion contract in 2004 to build, service, and manage water/sewage systems in Iraq. The deal is actually a joint venture between Fluor (a 44,800 employee company based on Aliso Viejo) and London’s AMEC, PLC and actually encompasses two separate contracts. The first - worth $600 million - obligates Fluor to build a water distribution infrastructure and cleaning system for Iraq’s major cities. A second $500 million deal will have the lucrative joint venture performing similar tasks in other, less hostile regions of the country.

9. Perini

Perini (controlled by financier Richard Blum) is one of the more controversial companies to have scored big-time Iraq war money. That’s because Blum’s wife, Senator Dianne Feinstein, appears to have used her seat on the Military Construction Appropriations subcomittee to steer the $650 million environmental cleanup deal in his favor. This has lead to outrage and cries for conflict of interest investigations among those in the media, as well as Feinstein’s peers in Congress. Feinstein has also neglected to comment on this potential conflict of interest. This has lead to what Metroactive.com calls an “omission [that] has called her ethical standards into question.”

10. URS Corporation

Another widely disparaged, Blum-controlled company that has profited from Iraq is URS Corporation. Long known as one of the nation’s major defense contractors, San Francisco-based URS has collected $792 million in environmental cleanup fees in Iraq war zones. As with Perini, both Blum and Feinstein have come under intense scrutiny to answer questions about the apparent conflict of interest inherent in Feinstein helping to secure such an exorbitant government contract for her investment banker husband. Both Blum and Feinstein have refused to produce copies of the ethics commitee’s rulings on Perini and URS, leading to considerable suspicion.

11. Parsons

Few Iraq contractors have come under fire as much as Parsons, who reportedly mismanaged the construction a police academy so poorly that human waste dripped from its ceilings. Far from being an isolated incident, reports from federal government auditors revealed lackluster work on 13 of the 14 Iraq projects entrusted to Parsons. Unfortunately, that hasn’t stopped the Pasedena-based firm from making off with $540 million in U.S. government funds for the poorly executed reconstruction projects at Iraq’s healthcare centers and fire stations. For obvious resaons, Parsons’ work in Iraq has generally been considered an embarassment.

“This is the lens through which Iraqis will now see America,” lamented Rep. Henry Waxman (D-Calif.) said. “Incompetence. Profiteering. Arrogance. And human waste oozing out of ceilings as a result.”

12. First Kuwaiti General Trading & Contracting

First Kuwaiti General Trading & Contracting is another example of the apparent cronyism that has gone into the process of awarding Iraq war contracts. It now seems that the company has succeeded on the strength of its ties to Bush Administration officials than its business merits. Rival companies have been extremely vocal in their displeasure at First Kuwaiti being awarded $500 million to build a United States Embassy in Baghdad.

“First Kuwaiti was not the lowest bidder”, complained Framco senior vice-president Gilles Kacha.

13. Armor Holdings

Armor Holdings (now a subsidiary of publicly traded BAE Systems) is one company whose opinion of the Iraq war can’t be all that negative. Since combat commenced in 2001, the company’s revenue has skyrocketed by a mind-blowing 2,247%, up to $634 million. Armor Holdings’ specialty is providing state-of-the-art armor for military vehicles and important personell as they traverse dangerous Iraqi war zones. The civil war between opposing Sunni and Shia and general unrest throughout the country have greatly increased the demand for the company’s products.

14. L3 Communications

L3 Communications has carved out a neat $359 million slice of Iraq’s security screening needs as of fiscal 2006. The New York-based company has been charged with overseeing the screening and training of law enforcement personell for the growing all-Iraqi security force, as well as replacing equipment in the field. Linguistics is another one of L3’s specialties, one that is heavily relied upon to interface with native speaking Sunni and Shia forces.

L3 Communications has also purchased Titan, a corporate intelligence company with a $1 billion Iraq contract. Prior to being acquired by L3, Titan plead guilty to international bribery charges (a felony) and paid a record-breaking $28.5 million under the Foreign Corrupt Practices Act.

15. AM General

AM General (a subsidiary of Renco) is another company that has seen its revenue sail toward the heavens since the beginning of combat in Iraq. The renowned maker of extra-wide all terrain vehicles (shown below) has seen its Pentagon revenues soar by 92%, a phenomenal leap for any business. This placed Renco sixth in a 2005 analysis of the fastest growing contractors by dollar amount, and sixth in an analysis of fastest growing contractors by percentage. Growing hostilities prior to the Bush Administration’s “surge” strategy in 2007 helped fuel the sudden demand for AM’s heavy duty combat vehicles.

16. HSBC Bank

Already the third largest financial institution on the planet, HSBC has seen its fortunes brighten beyond its wildest dreams since the start of combat. It has purchased a controlling stake (70%) of the newly created Iraqi national bank, Dar es Salaam Investment Bank, which, though small, has already amassed assets of $91 million. HSBC’s chief executive of Middle East operations, David Hodgkinson, was quoted as saying HSBC intends to “develop the bank’s services by investing in computerised payment systems and cash machines.’

HSBC’s stake in the fledgling Iraqi bank could turn out to be a significant strategic foothold in the developing country. According to a BBC report, the bank already has 14 operating branches across Iraq and a modest but growing staff of 450. It is also the first private bank in Iraq since the toppling of Saddam Hussein, as the late dictator did not allow them during his rule.

17. Cummins

Cummins has staked its claim to $45 million in Iraq war-related revenue with its robust line of diesel engines and power stations. According to a press release, United Kingdom-based Cummins”signed a distribution agreement with HMBS in Iraq for all Cummins brand products and equipment.” Antonio Leitao, Cummins’ General Manager of the commercial power generation business in Europe, spoke approvingly of the deal.

“Cummins Power Generation is proud to be the first generator set manufacturer to establish a distributorship in Iraq that covers the whole country.”

Cummins and power-generating companies like them will be instrumental over the coming years, as the world learns whether Iraq truly has a future as a rebuilt, independent nation.

18. MerchantBridge

MerchantBridge got its “in” to the growing money pot of Iraq’s fledgling financial sector by casting a wide net. The investment banking group has ambitiously targeted marketshare in Iraq’s developing construction, telecommunications, financial services, real estate, hotels, and information technology industries, all of which have been made easier by being the “lead advisor” to Iraq’s Ministry of Industry. The inside partnership has paved the way for MerchantBridge’s factory lease program, the opening of Mansour Bank, and an overall capitalization of $61 million.

Furthermore, 90% of MerchantBridge’s initial operating capital in Iraq has been supplied by Iraqi investors.

19. GlobalRisk Strategies

Risk management is a lucrative business the world over, and the stakes are nowhere higher than the high-pressure war zones of a foreign nation. GlobalRisk Strategies has capitalized on the bewildering uncertainty to the tune of $24.5 million, which it has primarily earned by advising U.S. and Coalition forces on the risks of various counter-terrorism strategies. Some of the more noteable risks the company’s 2,000 employees have managed include distributing fresh currency to the locals and guarding the heavily fortified Baghdad airport during 2004.

Alternatively, GlobalRisk has also assisted with reconstruction and delivering humanitarian aid in the banking, aviation, oil and infrastructure sectors throughout Iraq.

20. ControlRisks

ControlRisks is another risk management company that has successfully hopped on the Iraq bandwagon. The UK-based firm has extracted roughly $37 million in war-related profits by providing discreet armed security and logistics support to troops on the ground and in the air. With a presence of 250 employees in Iraq, ControlRisks has provided security for the disastrous Parsons Usaid buildings (prior to the revelation of the embarassing shoddy work scandal) and has also been tasked with protecting Iraq’s active duty UK forces. While Iraq has recently begun to cool down in terms of insurgent violence and infighting, the region should provide opportunities for companies like ControlRisks to profit for years or even decades to come.

21. CACI

CACI was called upon by the U.S. government to provide 36 interrogators to Iraq, 10 of which were assigned to Abu Grhraib. While all the details have not yet come to light, it looks like CACI profited from Iraq in the worst possible way. One website notes that a leaked Army investigation implicated CACI employee Stephen Stefanowicz in the abuse of prisoners.” Furthermore, the allegations have led the Center for Constitutional Rights to agitate for trying CACI and its affiliates in U.S. courts.

Susan Burke, an attorney working on the case on CCR’s behalf, was quoted as saying “We believe that CACI and Titan engaged in a conspiracy to torture and abuse detainees, and did so to make more money.”

22. Bechtel

Bechtel is yet another Iraq contractor who seems to have benefited from close ties to the Bush Admistration. How else would a company recommended by the man who oversaw the Big Dig disaster possibly be awarded a $2.4 billion, no-bid reconstruction contract for Iraq’s infrastructure? Journalists and competitors are scratching their heads at why the Bush Administration trusted the choice of USAID chief Andrew Natsios after his woefully ineffective tenure at the head of the Massachussetts Turnpike Authority. While in that capacity, the Big Dig’s operating costs ballooned from an initial $2.6 billion to $14.6 billion, and the job still took years to complete!

In line with Natsios’ track record of recommendations, this one turned out to be a flop. Bechtel proceeded to lose its contract for the Basra Children’s Hospital Project after falling a year and a half behind schedule and $70-$90 million over budget.

23. Custer Battles

Custer Battles has the dubious distinction of being the first Iraq war contractor to be found guilty of fraud. In March 2006, a jury ordered Custer to pay damages in excess of $10 million for 37 counts of fraud, including what the judge called “false and fraudulently inflated invoices.” While Custer wriggled out of serious penalties on a technicality (the Coalition Provisional Authority is not part of the U.S. Government and therefore crimes against it cannot be tried under U.S. law), the whole ordeal has muddied the company’s reputation greatly, possibly beyond repair. It also seems to have opened the floodgates for similar cases of contractor fraud. As of fall 2006, a backlog of 70 fraud cases were pending against Iraq contractors doing all manner of work.

During the trial, a retired Army general testified that the inflated invoice scandal stood out to him as “probably the worst I’ve ever seen in my 30 years in the Army.”

24. Nour USA

Of all the companies on this list, Nour USA might be the only one who actually did not exist until the Iraq war got underway. Since its opportunistic opening, the company has recieved $400 million in Iraq-related contracts, including a gigantic $80 million deal to secure the nation’s oil pipelines. Some critics allege the contract was pushed through by Ahmed Chalabi (whom one website calls “Iraq’s No. 1 Opportunist.”) While Chalabi has denied this allegation, several other bidders on the pipeline contract point out how awfully strange it is for a company with no prior experience to be awarded such a large contract.

Of course, it probably didn’t hurt Nour to have William Cohen (former Defense Secretary under Bill Clinton) on board as a company consultant, but that’s another story.

25. General Dynamics

According to a Washington Post report in July of 2006, General Dynamics is one of the big-name defense contractors that has gotten the biggest monetary boost from the Iraq war. The key to General’s war profiteering strategy has been a broad focus on virtually everything the government needs to wage war, including tank shells, bullets for small arms, and even Stryker vehicles, which were first put to use during the initial 2003 invasion to remove Saddam.

All of this has lifted the company to tripled profitability since 9/11, and critics are speculating that ties to top Defense Agencies helped grease the wheels. According to the Project on Government Oversight, Genearl Dynamics formally announced that it was hiring a former top aide to the Army Chief of Staff in November 1999 - conveniently, just a month after the aid announced a grand new vision to introduce wheeled, light armored vehicles like the Stryker into regular use.

Original article posted here.

New movie that helps shatter some of the last remaining lies about Iraq

Ending Empire

Evil Empire: Is Imperial Liquidation Possible for America?

By Chalmers Johnson

In politics, as in medicine, a cure based on a false diagnosis is almost always worthless, often worsening the condition that is supposed to be healed. The United States, today, suffers from a plethora of public ills. Most of them can be traced to the militarism and imperialism that have led to the near-collapse of our Constitutional system of checks and balances. Unfortunately, none of the remedies proposed so far by American politicians or analysts addresses the root causes of the problem.

According to an NBC News/Wall Street Journal poll, released on April 26, 2007, some 78% of Americans believe their country to be headed in the wrong direction. Only 22% think the Bush administration's policies make sense, the lowest number on this question since October 1992, when George H. W. Bush was running for a second term -- and lost. What people don't agree on are the reasons for their doubts and, above all, what the remedy -- or remedies -- ought to be.
The range of opinions on this is immense. Even though large numbers of voters vaguely suspect that the failings of the political system itself led the country into its current crisis, most evidently expect the system to perform a course correction more or less automatically. As Adam Nagourney of the New York Times reported, by the end of March 2007, at least 280,000 American citizens had already contributed some $113.6 million to the presidential campaigns of Hillary Rodham Clinton, Barack Obama, John Edwards, Mitt Romney, Rudolph Giuliani, or John McCain.

If these people actually believe a presidential election a year-and-a-half from now will significantly alter how the country is run, they have almost surely wasted their money. As Andrew Bacevich, author of The New American Militarism, puts it: "None of the Democrats vying to replace President Bush is doing so with the promise of reviving the system of check and balances.... The aim of the party out of power is not to cut the presidency down to size but to seize it, not to reduce the prerogatives of the executive branch but to regain them."
George W. Bush has, of course, flagrantly violated his oath of office, which requires him "to protect and defend the constitution," and the opposition party has been remarkably reluctant to hold him to account. Among the "high crimes and misdemeanors" that, under other political circumstances, would surely constitute the Constitutional grounds for impeachment are these: the President and his top officials pressured the Central Intelligence Agency to put together a National Intelligence Estimate (NIE) on Iraq's nuclear weapons that both the administration and the Agency knew to be patently dishonest. They then used this false NIE to justify an American war of aggression. After launching an invasion of Iraq, the administration unilaterally reinterpreted international and domestic law to permit the torture of prisoners held at Abu Ghraib prison in Baghdad, at Guantánamo Bay, Cuba, and at other secret locations around the world.

Nothing in the Constitution, least of all the commander-in-chief clause, allows the president to commit felonies. Nonetheless, within days after the 9/11 attacks, President Bush had signed a secret executive order authorizing a new policy of "extraordinary rendition," in which the CIA is allowed to kidnap terrorist suspects anywhere on Earth and transfer them to prisons in countries like Egypt, Syria, or Uzbekistan, where torture is a normal practice, or to secret CIA prisons outside the United States where Agency operatives themselves do the torturing.
On the home front, despite the post-9/11 congressional authorization of new surveillance powers to the administration, its officials chose to ignore these and, on its own initiative, undertook extensive spying on American citizens without obtaining the necessary judicial warrants and without reporting to Congress on this program. These actions are prima-facie violations of the Foreign Intelligence Surveillance Act of 1978 (and subsequent revisions) and of

Amendment IV of the Constitution.

These alone constitute more than adequate grounds for impeachment, while hardly scratching the surface. And yet, on the eve of the national elections of November 2006, then House Minority Leader, now Speaker, Nancy Pelosi (D-Calif.), pledged on the CBS News program "60 Minutes" that "impeachment is off the table." She called it "a waste of time." And six months after the Democratic Party took control of both houses of Congress, the prison at Guantánamo Bay was still open and conducting drumhead courts martial of the prisoners held there; the CIA was still using "enhanced interrogation techniques" on prisoners in foreign jails; illegal intrusions into the privacy of American citizens continued unabated; and, more than fifty years after the CIA was founded, it continues to operate under, at best, the most perfunctory congressional oversight.

Promoting Lies, Demoting Democracy

Without question, the administration's catastrophic war in Iraq is the single overarching issue that has convinced a large majority of Americans that the country is "heading in the wrong direction." But the war itself is the outcome of an imperial presidency and the abject failure of Congress to perform its Constitutional duty of oversight. Had the government been working as the authors of the Constitution intended, the war could not have occurred. Even now, the Democratic majority remains reluctant to use its power of the purse to cut off funding for the war, thereby ending the American occupation of Iraq and starting to curtail the ever-growing power of the military-industrial complex.

One major problem of the American social and political system is the failure of the press, especially television news, to inform the public about the true breadth of the unconstitutional activities of the executive branch. As Frederick A. O. Schwarz and Aziz Z. Huq, the authors of Unchecked and Unbalanced: Presidential Power in a Time of Terror, observe, "For the public to play its proper checking role at the ballot box, citizens must know what is done by the government in their names."

Instead of uncovering administration lies and manipulations, the media actively promoted them. Yet the first amendment to the Constitution protects the press precisely so it can penetrate the secrecy that is the bureaucrat's most powerful, self-protective weapon. As a result of this failure, democratic oversight of the government by an actively engaged citizenry did not -- and could not -- occur. The people of the United States became mere spectators as an array of ideological extremists, vested interests, and foreign operatives -- including domestic neoconservatives, Ahmed Chalabi and his Iraqi exiles, the Israeli Lobby, the petroleum and automobile industries, warmongers and profiteers allied with the military-industrial complex, and the entrenched interests of the professional military establishment -- essentially hijacked the government.
Some respected professional journalists do not see these failings as the mere result of personal turpitude but rather as deep structural and cultural problems within the American system as it exists today. In an interview with Matt Taibbi, Seymour Hersh, for forty years one of America's leading investigative reporters, put the matter this way:

"All of the institutions we thought would protect us -- particularly the press, but also the military, the bureaucracy, the Congress -- they have failed… So all the things that we expect would normally carry us through didn't. The biggest failure, I would argue, is the press, because that's the most glaring…. What can be done to fix the situation? [long pause] You'd have to fire or execute ninety percent of the editors and executives."

Veteran analyst of the press (and former presidential press secretary), Bill Moyers, considering a classic moment of media failure, concluded: "The disgraceful press reaction to Colin Powell's presentation at the United Nations [on February 5, 2003] seems like something out of Monty Python, with one key British report cited by Powell being nothing more than a student's thesis, downloaded from the Web -- with the student later threatening to charge U.S. officials with 'plagiarism.'"

As a result of such multiple failures (still ongoing), the executive branch easily misled the American public.

A Made-in-America Human Catastrophe

Of the failings mentioned by Hersh, that of the military is particularly striking, resembling as it does the failures of the Vietnam era, thirty-plus years earlier. One would have thought the high command had learned some lessons from the defeat of 1975. Instead, it once again went to war pumped up on our own propaganda -- especially the conjoined beliefs that the United States was the "indispensable nation," the "lone superpower," and the "victor" in the Cold War; and that it was a new Rome the likes of which the world had never seen, possessing as it did -- from the heavens to the remotest spot on the planet -- "full spectrum dominance." The idea that the U.S. was an unquestioned military colossus athwart the world, which no power or people could effectively oppose, was hubristic nonsense certain to get the country into deep trouble -- as it did -- and bring the U.S. Army to the point of collapse, as happened in Vietnam and may well happen again in Iraq (and Afghanistan).

Instead of behaving in a professional manner, our military invaded Iraq with far too small a force; failed to respond adequately when parts of the Iraqi Army (and Baathist Party) went underground; tolerated an orgy of looting and lawlessness throughout the country; disobeyed orders and ignored international obligations (including the obligation of an occupying power to protect the facilities and treasures of the occupied country -- especially, in this case, Baghdad's National Museum and other archaeological sites of untold historic value); and incompetently fanned the flames of an insurgency against our occupation, committing numerous atrocities against unarmed Iraqi civilians.

According to Andrew Bacevich, "Next to nothing can be done to salvage Iraq. It no longer lies within the capacity of the United States to determine the outcome of events there." Our former ambassador to Saudi Arabia, Chas W. Freeman, says of President Bush's recent "surge" strategy in Baghdad and al-Anbar Province: "The reinforcement of failure is a poor substitute for its correction."

Symbolically, a certain sign of the disaster to come in Iraq arrived via an April 26th posting from the courageous but anonymous Sunni woman who has, since August 2003, published the indispensable blog Baghdad Burning. Her family, she reported, was finally giving up and going into exile -- joining up to two million of her compatriots who have left the country. In her final dispatch, she wrote:

"There are moments when the injustice of having to leave your country simply because an imbecile got it into his head to invade it, is overwhelming. It is unfair that in order to survive and live normally, we have to leave our home and what remains of family and friends.... And to what?"

Retired General Barry McCaffrey, commander of the 24th Infantry Division in the first Iraq war and a consistent cheerleader for Bush strategies in the second, recently radically changed his tune. He now says, "No Iraqi government official, coalition soldier, diplomat, reporter, foreign NGO, nor contractor can walk the streets of Baghdad, nor Mosul, nor Kirkuk, nor Basra, nor Tikrit, nor Najaf, nor Ramadi, without heavily armed protection." In a different context, Gen. McCaffrey has concluded: "The U.S. Army is rapidly unraveling."

Even military failure in Iraq is still being spun into an endless web of lies and distortions by the White House, the Pentagon, military pundits, and the now-routine reporting of propagandists disguised as journalists. For example, in the first months of 2007, rising car-bomb attacks in Baghdad were making a mockery of Bush administration and Pentagon claims that the U.S. troop escalation in the capital had brought about "a dramatic drop in sectarian violence." The official response to this problem: the Pentagon simply quit including deaths from car bombings in its count of sectarian casualties. (It has never attempted to report civilian casualties publicly or accurately.) Since August 2003, there have been over 1,050 car bombings in Iraq. One study estimates that through June 2006 the death toll from these alone has been a staggering 78,000 Iraqis.

The war and occupation George W. Bush unleashed in Iraq has proved unimaginably lethal for unarmed civilians, but reporting the true levels of lethality in Iraq, or the nature of the direct American role in it was, for a long time, virtually taboo in the U.S. media. As late as October 2006, the journal of the British Medical Association, The Lancet, published a study conducted by researchers from Johns Hopkins University in Baltimore and al-Mustansiriya University in Baghdad estimating that, since March 2003, there were some 601,027 more Iraqi deaths from violence than would have been expected without a war. The British and American governments at first dismissed the findings, claiming the research was based on faulty statistical methods -- and the American media ignored the study, played down its importance, or dismissed its figures.
On March 27, 2007, however, it was revealed that the chief scientific adviser to the British Ministry of Defense, Roy Anderson, had offered a more honest response. The methods used in the study were, he wrote, "close to best practice." Another British official described them as "a tried and tested way of measuring mortality in conflict zones." Over 600,000 violent deaths in a population estimated in 2006 at 26.8 million -- that is, one in every 45 individuals -- amounts to a made-in-America human catastrophe.

One subject that the government, the military, and the news media try to avoid like the plague is the racist and murderous culture of rank-and-file American troops when operating abroad. Partly as a result of the background racism that is embedded in many Americans' mental make-up and the propaganda of American imperialism that is drummed into recruits during military training, they do not see assaults on unarmed "rag heads" or "hajis" as murder. The cult of silence on this subject began to slip only slightly in May 2007 when a report prepared by the Army's Mental Health Advisory Team was leaked to the San Diego Union-Tribune. Based on anonymous surveys and focus groups involving 1,320 soldiers and 447 Marines, the study revealed that only 56% of soldiers would report a unit member for injuring or killing an innocent noncombatant, while a mere 40% of Marines would do so. Some militarists will reply that such inhumanity to the defenseless is always inculcated into the properly trained soldier. If so, then the answer to this problem is to ensure that, in the future, there are many fewer imperialist wars of choice sponsored by the United States.

The Military-Industrial-Congressional Complex

Many other aspects of imperialism and militarism are undermining America's Constitutional system. By now, for example, the privatization of military and intelligence functions is totally out of control, beyond the law, and beyond any form of Congressional oversight. It is also incredibly lucrative for the owners and operators of so-called private military companies -- and the money to pay for their activities ultimately comes from taxpayers through government contracts. Any accounting of these funds, largely distributed to crony companies with insider connections, is chaotic at best. Jeremy Scahill, author of Blackwater: The Rise of the World's Most Powerful Mercenary Army, estimates that there are 126,000 private military contractors in Iraq, more than enough to keep the war going, even if most official U.S. troops were withdrawn. "From the beginning," Scahill writes, "these contractors have been a major hidden story of the war, almost uncovered in the mainstream media and absolutely central to maintaining the U.S. occupation of Iraq."

America's massive "military" budgets, still on the rise, are beginning to threaten the U.S. with bankruptcy, given that its trade and fiscal deficits already easily make it the world's largest net debtor nation. Spending on the military establishment -- sometimes mislabeled "defense spending" -- has soared to the highest levels since World War II, exceeding the budgets of the Korean and Vietnam War eras as well as President Ronald Reagan's weapons-buying binge in the 1980s. According to calculations by the National Priorities Project, a non-profit research organization that examines the local impact of federal spending policies, military spending today consumes 40% of every tax dollar.

Equally alarming, it is virtually impossible for a member of Congress or an ordinary citizen to obtain even a modest handle on the actual size of military spending or its impact on the structure and functioning of our economic system. Some $30 billion of the official Defense Department (DoD) appropriation in the current fiscal year is "black," meaning that it is allegedly going for highly classified projects. Even the open DoD budget receives only perfunctory scrutiny because members of Congress, seeking lucrative defense contracts for their districts, have mutually beneficial relationships with defense contractors and the Pentagon. President Dwight D. Eisenhower identified this phenomenon, in the draft version of his 1961 farewell address, as the "military-industrial-congressional complex." Forty-six years later, in a way even Eisenhower probably couldn't have imagined, the defense budget is beyond serious congressional oversight or control.

The DoD always tries to minimize the size of its budget by representing it as a declining percentage of the gross national product. What it never reveals is that total military spending is actually many times larger than the official appropriation for the Defense Department. For fiscal year 2006, Robert Higgs of the Independent Institute calculated national security outlays at almost a trillion dollars -- $934.9 billion to be exact -- broken down as follows (in billions of dollars):

Department of Defense: $499.4Department of Energy (atomic weapons):
$16.6Department of State (foreign military aid):
$25.3Department of Veterans Affairs (treatment of wounded soldiers):
$69.8Department of Homeland Security (actual defense):
$69.1Department of Justice (1/3rd for the FBI):
$1.9Department of the Treasury (military retirements):
$38.5NASA (satellite launches):
$7.6Interest on war debts,
1916-present: $206.7
Totaled, the sum is larger than the combined sum spent by all other nations on military security.
This spending helps sustain the national economy and represents, essentially, a major jobs program. However, it is beginning to crowd out the civilian economy, causing stagnation in income levels. It also contributes to the hemorrhaging of manufacturing jobs to other countries. On May 1, 2007, the Center for Economic and Policy Research released a series of estimates on "the economic impact of the Iraq war and higher military spending." Its figures show, among other things, that, after an initial demand stimulus, the effect of a significant rise in military spending (as we've experienced in recent years) turns negative around the sixth year.
Sooner or later, higher military spending forces inflation and interest rates up, reducing demand in interest-sensitive sectors of the economy, notably in annual car and truck sales. Job losses follow. The non-military construction and manufacturing sectors experience the largest share of these losses. The report concludes, "Most economic models show that military spending diverts resources from productive uses, such as consumption and investment, and ultimately slows economic growth and reduces employment."

Imperial Liquidation?

Imperialism and militarism have thus begun to imperil both the financial and social well-being of our republic. What the country desperately needs is a popular movement to rebuild the Constitutional system and subject the government once again to the discipline of checks and balances. Neither the replacement of one political party by the other, nor protectionist economic policies aimed at rescuing what's left of our manufacturing economy will correct what has gone wrong. Both of these solutions fail to address the root cause of our national decline.
I believe that there is only one solution to the crisis we face. The American people must make the decision to dismantle both the empire that has been created in their name and the huge (still growing) military establishment that undergirds it. It is a task at least comparable to that undertaken by the British government when, after World War II, it liquidated the British Empire. By doing so, Britain avoided the fate of the Roman Republic -- becoming a domestic tyranny and losing its democracy, as would have been required if it had continued to try to dominate much of the world by force.

For the U.S., the decision to mount such a campaign of imperial liquidation may already come too late, given the vast and deeply entrenched interests of the military-industrial complex. To succeed, such an endeavor might virtually require a revolutionary mobilization of the American citizenry, one at least comparable to the civil rights movement of the 1960s.
Even to contemplate a drawing back from empire -- something so inconceivable to our pundits and newspaper editorial writers that it is simply never considered -- we must specify as clearly as possible precisely what the elected leaders and citizens of the United States would have to do. Two cardinal decisions would have to be made. First, in Iraq, we would have to initiate a firm timetable for withdrawing all our military forces and turning over the permanent military bases we have built to the Iraqis. Second, domestically, we would have to reverse federal budget priorities.

In the words of Noam Chomsky, a venerable critic of American imperialism: "Where spending is rising, as in military supplemental bills to conduct the wars in Iraq and Afghanistan, it would sharply decline. Where spending is steady or declining (health, education, job training, the promotion of energy conservation and renewable energy sources, veterans benefits, funding for the UN and UN peacekeeping operations, and so on), it would sharply increase. Bush's tax cuts for people with incomes over $200,000 a year would be immediately rescinded."

Such reforms would begin at once to reduce the malevolent influence of the military-industrial complex, but many other areas would require attention as well. As part of the process of de-garrisoning the planet and liquidating our empire, we would have to launch an orderly closing-up process for at least 700 of the 737 military bases we maintain (by official Pentagon count) in over 130 foreign countries on every continent except Antarctica. We should ultimately aim at closing all our imperialist enclaves, but in order to avoid isolationism and maintain a capacity to assist the United Nations in global peacekeeping operations, we should, for the time being, probably retain some 37 of them, mostly naval and air bases.

Equally important, we should rewrite all our Status of Forces Agreements -- those American-dictated "agreements" that exempt our troops based in foreign countries from local criminal laws, taxes, immigration controls, anti-pollution legislation, and anything else the American military can think of. It must be established as a matter of principle and law that American forces stationed outside the U.S. will deal with their host nations on a basis of equality, not of extraterritorial privilege.

The American approach to diplomatic relations with the rest of the world would also require a major overhaul. We would have to end our belligerent unilateralism toward other countries as well as our scofflaw behavior regarding international law. Our objective should be to strengthen the United Nations, including our respect for its majority, by working to end the Security Council veto system (and by stopping using our present right to veto). The United States needs to cease being the world's largest supplier of arms and munitions -- a lethal trade whose management should be placed under UN supervision. We should encourage the UN to begin outlawing weapons like land mines, cluster bombs, and depleted-uranium ammunition that play particularly long-term havoc with civilian populations. As part of an attempt to right the diplomatic balance, we should take some obvious steps like recognizing Cuba and ending our blockade of that island and, in the Middle East, working to equalize aid to Israel and Palestine, while attempting to broker a real solution to that disastrous situation. Our goal should be a return to leading by example -- and by sound arguments -- rather than by continual resort to unilateral armed force and repeated foreign military interventions.

In terms of the organization of the executive branch, we need to rewrite the National Security Act of 1947, taking away from the CIA all functions that involve sabotage, torture, subversion, overseas election rigging, rendition, and other forms of clandestine activity. The president should be deprived of his power to order these types of operations except with the explicit advice and consent of the Senate. The CIA should basically devote itself to the collection and analysis of foreign intelligence. We should eliminate as much secrecy as possible so that neither the CIA, nor any other comparable organization ever again becomes the president's private army.

In order to halt our economic decline and lessen our dependence on our trading partners, the U.S. must cap its trade deficits through the perfectly legal use of tariffs in accordance with World Trade Organization rules, and it must begin to guide its domestic market in accordance with a national industrial policy, just as the leading economies of the world (particularly the Japanese and Chinese ones) do as a matter of routine. Even though it may involve trampling on the vested interests of American university economics departments, there is simply no excuse for a continued reliance on an outdated doctrine of "free trade."

Normally, a proposed list of reforms like this would simply be rejected as utopian. I understand this reaction. I do want to stress, however, that failure to undertake such reforms would mean condemning the United States to the fate that befell the Roman Republic and all other empires since then. That is why I gave my book Nemesis the subtitle "The Last Days of the American Republic."

When Ronald Reagan coined the phrase "evil empire," he was referring to the Soviet Union, and I basically agreed with him that the USSR needed to be contained and checkmated. But today it is the U.S. that is widely perceived as an evil empire and world forces are gathering to stop us. The Bush administration insists that if we leave Iraq our enemies will "win" or -- even more improbably -- "follow us home." I believe that, if we leave Iraq and our other imperial enclaves, we can regain the moral high ground and disavow the need for a foreign policy based on preventive war. I also believe that unless we follow this path, we will lose our democracy and then it will not matter much what else we lose. In the immortal words of Pogo, "We have met the enemy and he is us."

Chalmers Johnson is the author of Nemesis: The Last Days of the American Republic (New York: Metropolitan Books, 2007). It is the final volume of his Blowback Trilogy.

Original article posted here.

Just examples of the waste that is destroying America economically with this joke war

So much for the permanent wartime economy . . .

Report Shows Increased U.S. Military Spending Slows Economy

Washington, DC: The Center for Economic and Policy Research released a report today estimating the economic impact of increased U.S. military spending comparable to the spending on the Iraq war. The report, presenting the results of a simulation from the economic forecasting company Global Insight, shows the increased level of military spending leads to fewer jobs and slower economic growth.

For the report, The Economic Impact of the Iraq War and Higher Military Spending, by economist Dean Baker, CEPR commissioned Global Insight to run a simulation with its macroeconomic model. Global Insight's model was selected for this analysis because it is a commonly used and widely respected model. It estimated the impact of an increase in annual U.S. military spending equal to 1 percent of GDP (approximately equal to the military spending increase compared with pre-September 11th baseline).

The projections show the following:

-- After an initial demand stimulus, the effect of increased military spending turns negative around the sixth year. After 10 years of higher defense spending, there would be 464,000 fewer jobs than in the baseline scenario with lower defense spending.

-- Inflation and interest rates are considerably higher. After 5 years, the interest rate on 10-Year Treasury notes is projected to be 0.7 percentage points higher than in the baseline scenario. After 10 years, the gap would rise to 0.9 percentage points.

-- Higher interest rates lead to reduced demand in the interest-sensitive sectors of the economy. After 5 years, annual car and truck sales are projected to go down by 192,200 in the high military spending scenario. After 10 years, the drop is projected to be 323,300 and after 20 years annual sales are projected to be down 731,400.

-- Construction and manufacturing are the sectors that are projected to experience the largest shares of the job loss.

"It is often believed that wars and military spending increases are good for the economy," said Baker. "In fact, most economic models show that military spending diverts resources from productive uses, such as consumption and investment, and ultimately slows economic growth and reduces employment."

The report recommends that Congress request the Congressional Budget Office produce its own projections of the economic impact of a sustained increase in defense spending.

Original article posted here.

All For The Oil: The War Crime of Mass Deportation

Arabs ethnically cleansed in Iraq

The US-backed government in Baghdad has approved the ethnic cleansing of Arabs from the Iraqi city of Kirkuk – which is home to Arabs, Kurds and other ethnic groups.

They want to purge the city ahead of a crucial referendum on the future of the oil rich city set for the end of this year. The vote will decide whether Kirkuk remains part of Iraq.

The referendum is part of a plan to carve Iraq into three regions – a Kurdish north, Shia south and Sunni centre.

The Kurdish regional government, which wants control over the oil fields, has marked the city as the battleground for the next bloody chapter in the occupation.

The plan to break with Iraq is threatening to plunge the country into a sectarian and ethnic civil war that could draw Turkey into the war.

Original article posted here.

When Two Disasters are not Enough

Iran - Ready to attack

American preparations for invading Iran are complete, Dan Plesch reveals. Plus Rageh Omaar's insights from Iran and Andrew Stephen on fears George Bush's administration will blunder into war

American military operations for a major conventional war with Iran could be implemented any day. They extend far beyond targeting suspect WMD facilities and will enable President Bush to destroy Iran's military, political and economic infrastructure overnight using conventional weapons.

British military sources told the New Statesman, on condition of anonymity, that "the US military switched its whole focus to Iran" as soon as Saddam Hussein was kicked out of Baghdad. It continued this strategy, even though it had American infantry bogged down in fighting the insurgency in Iraq.

The US army, navy, air force and marines have all prepared battle plans and spent four years building bases and training for "Operation Iranian Freedom". Admiral Fallon, the new head of US Central Command, has inherited computerised plans under the name TIRANNT (Theatre Iran Near Term).

The Bush administration has made much of sending a second aircraft carrier to the Gulf. But it is a tiny part of the preparations. Post 9/11, the US navy can put six carriers into battle at a month's notice. Two carriers in the region, the USS John C Stennis and the USS Dwight D Eisenhower, could quickly be joined by three more now at sea: USS Ronald Reagan, USS Harry S Truman and USS Theodore Roosevelt, as well as by USS Nimitz. Each carrier force includes hundreds of cruise missiles.

Then there are the marines, who are not tied down fighting in Iraq. Several marine forces are assembling, each with its own aircraft carrier. These carrier forces can each conduct a version of the D-Day landings. They come with landing craft, tanks, jump-jets, thousands of troops and, yes, hundreds more cruise missiles. Their task is to destroy Iranian forces able to attack oil tankers and to secure oilfields and installations. They have trained for this mission since the Iranian revolution of 1979.

Today, marines have the USS Boxer and USS Bataan carrier forces in the Gulf and probably also the USS Kearsarge and USS Bonhomme Richard. Three others, the USS Peleliu, USS Wasp and USS Iwo Jima, are ready to join them. Earlier this year, HQ staff to manage these forces were moved from Virginia to Bahrain.

Vice-President Dick Cheney has had something of a love affair with the US marines, and this may reach its culmination in the fishing villages along Iran's Gulf coast. Marine generals hold the top jobs at Nato, in the Pentagon and are in charge of all nuclear weapons. No marine has held any of these posts before.

Traditionally, the top nuclear job went either to a commander of the navy's Trident submarines or of the air force's bombers and missiles. Today, all these forces follow the orders of a marine, General James Cartwright, and are integrated into a "Global Strike" plan which places strategic forces on permanent 12-hour readiness.

The only public discussion of this plan has been by the American analysts Bill Arkin and Hans Kristensen, who have focused on the possible use of atomic weapons. These concerns are justified, but ignore how forces can be used in conventional war.

Any US general planning to attack Iran can now assume that at least 10,000 targets can be hit in a single raid, with warplanes flying from the US or Diego Garcia. In the past year, unlimited funding for military technology has taken "smart bombs" to a new level.

New "bunker-busting" conventional bombs weigh only 250lb. According to Boeing, the GBU-39 small-diameter bomb "quadruples" the firepower of US warplanes, compared to those in use even as recently as 2003. A single stealth or B-52 bomber can now attack between 150 and 300 individual points to within a metre of accuracy using the global positioning system.

With little military effort, the US air force can hit the last-known position of Iranian military units, political leaders and supposed sites of weapons of mass destruction. One can be sure that, if war comes, George Bush will not want to stand accused of using too little force and allowing Iran to fight back.

"Global Strike" means that, without any obvious signal, what was done to Serbia and Lebanon can be done overnight to the whole of Iran. We, and probably the Iranians, would not know about it until after the bombs fell. Forces that hide will suffer the fate of Saddam's armies, once their positions are known.

The whole of Iran is now less than an hour's flying time from some American base or carrier. Sources in the region as well as trade journals confirm that the US has built three bases in Azerbaijan that could be transit points for troops and with facilities equal to its best in Europe.

Most of the Iranian army is positioned along the border with Iraq, facing US army missiles that can reach 150km over the border. But it is in the flat, sandy oilfields east and south of Basra where the temptation will be to launch a tank attack and hope that a disaffected population will be grateful.

The regime in Tehran has already complained of US- and UK-inspired terror attacks in several Iranian regions where the population opposes the ayatollahs' fanatical policies. Such reports corroborate the American journalist Seymour Hersh's claim that the US military is already engaged in a low-level war with Iran. The fighting is most intense in the Kurdish north where Iran has been firing artillery into Iraq. The US and Iran are already engaged in a low-level proxy war across the Iran-Iraq border.

And, once again, the neo-cons at the American Enterprise Institute have a plan for a peaceful settlement: this time it is for a federal Iran. Officially, Michael Ledeen, the AEI plan's sponsor, has been ostracised by the White House. However, two years ago, the Congress of Iranian Nationalities for a Federal Iran had its inaugural meeting in London.

We should not underestimate the Bush administration's ability to convince itself that an "Iran of the regions" will emerge from a post-rubble Iran.

Dan Plesch is a research associate at the School of Oriental and African Studies

Articles from this issue on Iran
This, Mr President, is how wars start by Andrew Stephen
Sheer incompetence could be the trigger.

We are asking the wrong questions of Iran by Rageh Omaar
Rageh Omaar finds a country more complex than most in the west have ever

Original article posted here.

A good start: Waste, Profiteering and Corruption (though it will never be signed by the Moron)

U.S. SENATOR PATRICK LEAHY

CONTACT: Office of Senator Leahy, 202-224-4242
VERMONT


--------------------------------------------------------------------------------
Incoming Judiciary Chairman Leahy Targets Corruption
In First Bills Of 110th Congress

Leahy Introduces Bills To Combat War Profiteering, Public Corruption

WASHINGTON (Thursday, January 4) – Signaling a renewed emphasis on combating corruption at home and abroad, incoming Senate Judiciary Committee Chairman Patrick Leahy (D-Vt.), introduced a package of bills Thursday targeting corrupt officials and private companies seeking to defraud American taxpayers and troops.

“Americans want the culture of corruption to end. From war profiteers and corrupt officials in Iraq, to convicted Administration officials, to influence-peddling lobbyists and, regrettably, even members of Congress, too many supposed public servants have been serving their own interests, rather than the public interest,” said Leahy.

Many Democratic Senators joined Leahy in reintroducing a bill creating criminal penalties for war profiteers and cheats who would exploit taxpayer-funded efforts in Iraq and elsewhere around the world. The War Profiteering Prevention Act of 2007 builds on earlier efforts by Leahy, who is also a senior member of the Appropriations Committee, to crack down on this type of rampant fraud and abuse. It is similar to legislation Leahy introduced in 2003, that was subsequently passed by the Senate as part of an appropriations bill but later torpedoed by the White House and the House Republican leadership, which stripped out the Leahy provision.

Also on Thursday, Leahy joined with Senator Mark Pryor (D-Ark.), on another anti-corruption measure aimed at strengthening the tools available to federal prosecutors in combating public corruption. This bill gives investigators and prosecutors the statutory tools and the resources that they need to ensure that serious and insidious public corruption is detected and punished, including extending the statute of limitations on some of the worst crimes.

“The American people staged an intervention during the November elections and made it clear that they would not stand for it any longer. They expect the Congress to take action, and these bills are a good first step toward meeting that call,” Leahy said. “We need to restore the people’s trust by acting to clean up the people’s government.”

# # # # #

Below are Senator Leahy’s statements on the War Profiteering Prevention Act of 2007 and the Effective Corruption Prosecutions Act of 2007 and, as well as summaries of the two bills and background information detailing a few examples of the fraud and war profiteering that have already occurred in Iraq and elsewhere.

Statement of Senator Patrick Leahy
On Introduction of the War Profiteering Prevention Act of 2007
January 4, 2007

Mr. LEAHY: Mr. President, today I am reintroducing a bill that creates criminal penalties for war profiteers and cheats who would exploit taxpayer-funded efforts in Iraq and elsewhere around the world. Last year, despite the mounting evidence of widespread contractor fraud and abuse in Iraq, the Republican–controlled Senate would not act on it. Instead, the Congress took a terrible misstep in seeking to end the work of the Special Inspector General for Iraq Reconstruction. I have been proposing versions of this bill since 2003, when it did pass the Senate. Unfortunately, this crucial provision was stripped out of the final version of a bill by a Republican-controlled conference committee.

There is growing evidence of widespread contractor fraud in Iraq, yet prosecuting criminal cases against these war profiteers is difficult under current law. We must crack down on this rampant fraud and abuse that squanders American taxpayers’ dollars and jeopardizes the safety of our troops abroad. That is why I renew my efforts for accountability and action with the introduction of the War Profiteering Prevention Act of 2007. I am pleased to join with Senators Bingaman, Kerry, Harkin, Rockefeller, Dorgan, Wyden, Schumer, Cantwell, Bill Nelson, Clinton, Lautenberg and Menendez to introduce this legislation.

Widespread Fraud and War Profiteering in Iraq

Congress has sent billions upon billions of dollars to Iraq with too little accountability and too few financial controls. More than $50 billion of this money has gone to private contractors hired to guard bases, drive trucks, feed and shelter the troops and rebuild the country. This is more than the annual budget of the Department of Homeland Security.

Instead of results from these companies, we are seeing penalties levied for allegations of fraud and abuse. At least 10 companies with billions of dollars in U.S. contracts for Iraq reconstruction have paid more than $300 million in penalties since 2000, to resolve allegations of bid rigging, fraud, delivery of faulty military parts and environmental damage. Seven other companies with Iraq reconstruction contracts have agreed to pay financial penalties without admitting wrongdoing.

In 2005, Halliburton took in approximately $3.6 billion from contracts to serve U.S. troops and rebuild the oil industry in Iraq. Halliburton executives say that the company received about $1 billion a month for Iraq work in 2006. In addition, last month, we learned of new plans to spend hundreds of millions more to create jobs in Iraq.

Last year, the Special Inspector General for Iraq Reconstruction found that millions of U.S. taxpayer funds appropriated for Iraq reconstruction have been lost and diverted. Yet we continue to send more taxpayer funds to Iraq, without accountability.

Too much of this money is unaccounted for, and many of the facilities and services that these funds were supposed to pay for are still nonexistent. We in Congress must ask – where did all the money go? We need to press for more accountability over the use and abuse of billions of taxpayers’ dollars sent as development aid to Iraq, not less.

Accountability is Long Overdue

A new law to combat war profiteering in Iraq and elsewhere is sorely needed and long overdue. Although there are anti-fraud laws to protect against the waste of U.S. tax dollars at home, no law expressly prohibits war profiteering or expressly confers jurisdiction on U.S. federal courts to hear fraud cases involving war profiteering committed overseas.

The bill I introduced today would criminalize Awar profiteering@ – overcharging taxpayers in order to defraud and to profit excessively from a war, military action, or reconstruction efforts. It would also prohibit any fraud against the United States involving a contract for the provision of goods or services in connection with a war, military action, or for relief or reconstruction activities. This new crime would be a felony, subject to criminal penalties of up to 20 years in prison and fines of up to $1 million, or twice the illegal gross profits of the crime.

The bill also prohibits false statements connected with the provision of goods or services in connection with a war or reconstruction effort. This crime would also be a felony, subject to criminal penalties of up to 10 years in prison and fines of up to $1 million, or twice the illegal gross profits of the crime.

The measure also addresses weakness in the existing laws used to combat war profiteering, by providing clear authority for the Government to seek criminal penalties and to recover excessive profits for war profiteering overseas. These are strong and focused sanctions that are narrowly tailored to punish and deter fraud or excessive profiteering in contracts, both at home and abroad.

The message sent by this bill is clear -- any act to exploit the crisis situation in Iraq or elsewhere overseas for exorbitant gain is unacceptable, reprehensible, and criminal. Such deceit demeans and exploits the sacrifices that our military personnel are making in Iraq and Afghanistan, and around the world. This bill also builds on a strong legacy of historical efforts to stem war profiteering. Congress implemented excessive-profits taxes and contract renegotiation laws after both World Wars, and again after the Korean War. Advocating exactly such an approach, President Roosevelt once declared it our duty to ensure that “a few do not gain from the sacrifices of the many.”

A Fresh Start

Our Government cannot in good faith ask its people to sacrifice for reconstruction efforts that allow some to profit unfairly. When U.S. taxpayers have been called upon to bear the burden of reconstruction contracts – where contracts are awarded in a system that offers little competition and even less accountability – concerns about wartime profiteering are a grave matter.

Combating war profiteering is not a Democratic issue, or a Republican issue. Rather, it is a cause that all Americans can support. When I first introduced this bill in 2003, it came to be cosponsored by 21 Senators. The Senate Appropriations Committee also unanimously accepted these provisions during a Senate Appropriations Committee markup of the $87 billion appropriations bill for Iraq and Afghanistan for Fiscal Year 2004, and this provision passed the Senate. Passing bipartisan war profiteering prevention legislation was the right thing to do then, and it is the right thing to do now.

I am hopeful that in a new year, and with a new Congress, we can make a fresh start and forge a bipartisan partnership on this important issue that will result in passage of this bill. I ask unanimous consent that a copy of the bill be printed in the Record.

# # # # #

War Profiteering Prevention Act of 2007

§ Criminalizes war profiteering, which is defined as materially overvaluing any good or service with the specific intent to excessively profit from the war and relief or reconstruction activities

§ Statute would strengthen the tools available to federal prosecutors to combat war profiteering by providing clear authority for the Government to seek criminal penalties and to recover excessive profits for war profiteering overseas.

§ Prohibits any fraud against the United States, Iraq, or any other foreign country involving a contract for the provision of any goods or services in connection with a war, military action, or relief or reconstruction activities.

§ Subjects violators to up to 20 years imprisonment and a fine not to exceed the greater of $1,000,000 or twice the amount of any illegal gross profits, or both.

§ Prohibits making a false statement in any matter involving a contract for the provision of any goods or services in connection with a war, military action, or relief or reconstruction activities.

§ Subjects violators of this provision to up to 10 years imprisonment and a fine not to exceed the greater of $1,000,000, or twice the amount of any illegal gross profits, or both.

§ Creates extraterritorial jurisdiction over offenses committed overseas, and covers any person in the United States or abroad who violates its provisions.

(Background Information)

Billions Of Taxpayer Dollars Lost
To Fraud And Waste In Iraq And Elsewhere

The United States has spent more than a quarter of a TRILLION dollars during its four years in Iraq.

Over $50 BILLION -- more than the annual budget of the Department of Homeland Security -- has been spent to hire private contractors to guard bases, drive trucks, feed and shelter the troops and rebuild the country.

BILLIONS of taxpayer dollars are unaccounted for, according to a finding by the special inspector general examining the Iraq reconstruction effort.

Since 2000, 10 companies with billions of dollars in U.S. contracts for Iraq reconstruction have paid more than $300 MILLION IN PENALTIES to resolve allegations of bid rigging, fraud, delivery of faulty military parts and environmental damage in connection with other projects.

Examples of Fraud and Waste - Custer Battles, Halliburton and Bechtel

CUSTER BATTLES is accused of bilking the government out of $50 MILLION

Custer Battles billed the government nearly $10 MILLION when its actual costs were less than $4 MILLION, according to a government investigation.

Custer Battles over billed electricity costs by $326,000 - Actual electricity charges of $74,000 were billed at $400,000.

Custer Battles over billed for trucks that did not run by $572,000 – Actual purchase price of $228,000 for faulty trucks were billed to government for $800,000.

The two largest government contractors in Iraq -- Bechtel Corp. and Halliburton Co. -- have been fined several times in the past four years.

HALLIBURTON CO. averaged about $ 1 BILLION A MONTH from the government for work in Iraq in 2006, according to executives. The company took in $3.6 BILLION last year from contracts to serve U.S. troops and rebuild the oil industry in Iraq.

A pattern of fraud, waste, and corruption by Halliburton in Iraq emerged through news reports between December 2003 and May 2004. In December, a Pentagon investigation found evidence that Halliburton's Kellogg, Brown & Root (KBR) had overcharged the U.S. government some $61 MILLION for fuel deliveries from Kuwait to Iraq. In January, Halliburton admitted to the Pentagon that two of its employees took up to $6 million in kickbacks for awarding a Kuwaiti-based company with work in Iraq. Then in early February it was reported that the company had agreed to repay the U.S. government some $27 million for meals that were never served to American troops.

Bills From Five-Star, Beachfront Hotel And Drivers Paid to Haul Empty Trucks - In May 2006, the Coalition Provisional Authority's inspector general started raising questions about the bills that Halliburton had racked up at a five-star beachfront hotel near Kuwait City. And 12 Halliburton truck drivers claimed they risked their lives driving empty trucks in Iraq while their employer billed the government for hauling absolutely nothing.

Investigation of Overcharging And Potential Connection to Nigeria Bribery Scheme - Federal authorities are also investigating whether Halliburton broke the law by using a subsidiary to do business in Iran, whether the company overcharged for work done for the Pentagon in the Balkans and whether it was involved in an alleged $180 million bribery scheme in Nigeria. The company admitted in 2003 that it improperly paid $2.4 million to a Nigerian tax official.

BECHTEL CORP. paid more than $110,000 to the Environmental Protection Agency and the Energy Department in 2000 and 2001 to settle alleged safety and environmental violations. Bechtel has prime construction contracts in Iraq worth more than $2 billion.

Fines Exceeding $86 Million - Bechtel hired three subcontractors in Iraq that have been fined more than $86 million in the past four years, though none had been banned from getting new contracts.

Others Punished For Waste, Fraud and Abuse Of Govt. Contracts

American International Contractors Inc., paid $4.7 million in fines in 2000 after pleading guilty to bid rigging on a U.S.-funded water project in Egypt, according to published reports. AICI has part of a $325 million contract to rebuild Iraq's transportation systems, has a share of a $500 million contract for emergency construction needs in the Pentagon's Central Command region, which includes Iraq and Afghanistan, and is in a partnership that has a $70 million construction contract at Al-Udeid air base in Qatar, used to support troops in Iraq.

Fluor Corp., paid $8.5 million to the Defense Department in 2001 to settle charges it improperly billed the government for work benefiting its commercial clients, according to published reports. Fluor and AMEC created a joint venture that has $1.7 billion in contracts to rebuild Iraq's electricity, water, sewer and trash removal infrastructure.

Great Lakes Dredge & Dock Co., paid a $969,000 fine in 2002 for environmental damage in the Florida Keys National Marine Sanctuary, according to published reports. Bechtel awarded the company a subcontract to clear the Iraqi port of Umm Qasr.

Northrop Grumman Corp., whose Vinnell Corp. subsidiary was awarded a $48 million contract to train the new Iraqi Army last year, according to published reports. Northrop Grumman has been penalized $191.7 million in the past four years, including $750,000 paid to the Pentagon in 2000 in a case involving allegations of providing faulty replacement parts for the JSTARS airborne surveillance system.

# # # # #

Statement of Senator Patrick Leahy
On Introduction of the Effective Corruption Prosecutions Act of 2007
January 4, 2007

I am pleased to join with Senator Pryor today to introduce the Effective Corruption Prosecutions Act of 2007, a bill to strengthen the tools available to federal prosecutors in combating public corruption. This bill gives investigators and prosecutors the statutory tools and the resources they need to ensure that serious and insidious public corruption is detected and punished.

In November, voters sent a strong message that they were tired of the culture of corruption. From war profiteers and corrupt officials in Iraq to convicted Administration officials to influence-peddling lobbyists and, regrettably, even members of Congress, too many supposed public servants were serving their own interests, rather than the public interest. The American people staged an intervention and made it clear that they would not stand for it any longer. They expect the Congress to take action. We need to restore the people’s trust by acting to clean up the people’s government.

The Senate’s new leadership is introducing important lobbying reform and ethics legislation. Similar legislation passed the Senate last year, but stalled in the House. This is a vital first step.

But the most serious corruption cannot be prevented only by changing our own rules. Bribery and extortion are committed by people bent on getting around the rules and banking that they won’t get caught. These offenses can be difficult to detect and even harder to prove. Because they attack the core of our democracy, these offenses must be found out and punished. Congress must send a signal that it will not tolerate this corruption by providing better tools for federal prosecutors to combat it. This bill will do exactly that.

First, the bill extends the statute of limitations for the most serious public corruption offenses. Specifically, it extends the statute of limitations from five years to eight years for bribery, deprivation of honest services, and extortion by a public official. This is an important step because public corruption cases are among the most difficult and time-consuming cases to investigate and prosecute. They often require use of informants and electronic monitoring, as well as review of extensive financial and electronic records, techniques which take time to develop and implement.

Bank fraud, arson, and passport fraud, among other offenses, all have 10-year statutes of limitations. Since public corruption offenses are so important to our democracy and these cases are so difficult to investigate and prove, a more modest extended statute of limitations for these offenses is a reasonable step to help our corruption investigators and prosecutors do their jobs. Corrupt officials should not be able to get away with their ill-gotten gains just by winning the waiting game.

This bill also facilitates the investigation and prosecution of an important offense known as federal program bribery. (Title 18, United States Code, section 666). Federal program bribery is the key federal statute for prosecuting bribery involving state and local officials, as well as officials of the many organizations that receive substantial federal money. This bill would allow agents and prosecutors investigating this important offense to request authority to conduct wiretaps and to use federal program bribery as a basis for a racketeering charge.

Wiretaps, when appropriately requested and authorized, are an important method for agents and prosecutors to gain evidence of corrupt activities, which can otherwise be next to impossible to prove without an informant. The Racketeer Influenced and Corrupt Organizations (RICO) statute is also an important tool which helps prosecutors target organized crime and corruption.

Agents and prosecutors may currently request authority to conduct wiretaps to investigate many serious offenses, including bribery of federal officials and even sports bribery, and may predicate RICO charges on these offenses, as well. It is only reasonable that these important tools also be available for investigating the similar and equally important offense of federal program bribery.

Lastly, this bill authorizes $25 million in additional federal funds over each of the next four years to give federal investigators and prosecutors needed resources to go after public corruption. Last month, FBI Director Mueller in written testimony to the Judiciary Committee called public corruption the FBI’s top criminal investigative priority. However, a September 2005 Report by Department of Justice Inspector General Fine found that, from 2000 to 2004, there was an overall reduction in public corruption matters handled by the FBI. The report also found declines in resources dedicated to investigating public corruption, in corruption cases initiated, and in cases forwarded to US Attorney’s Offices.

I am heartened by Director Mueller’s assertion that there has recently been an increase in the number of agents investigating public corruption cases and the number of cases investigated, but I remain concerned by the Inspector General’s findings. I am concerned because the FBI in recent years has diverted resources away from criminal law priorities, including corruption, into counterterrorism. The FBI may need to divert further resources to cover the growing costs of Sentinel, their data management system. The Department of Justice has similarly diverted resources, particularly from United States Attorney’s Offices.

Additional funding is important to compensate for this diversion of resources and to ensure that corruption offenses are aggressively pursued. My bill will give the FBI, the United States Attorney’s Offices, and the Public Integrity Section of the Department of Justice new resources to hire additional public corruption investigators and prosecutors. They can finally have the manpower they need to track down and make these difficult cases, and root out the corruption.

If we are serious about addressing the egregious misconduct that we have recently witnessed, Congress must enact meaningful legislation to give investigators and prosecutors the resources they need to enforce our public corruption laws. I strongly urge Congress to do more to restore the public's trust in their government.

I ask that a copy of the bill be printed in the Record.

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Effective Corruption Prosecutions Act of 2007

Provides federal investigators and prosecutors the statutory tools and the resources needed to ensure that serious and insidious public corruption is detected and punished.

Extends the statute of limitations for the most serious public corruption offenses, including bribery, deprivation of honest services, and extortion by a public official, from five years to eight years.

Facilitates the investigation and prosecution of a key federal statute used for prosecuting bribery involving state and local officials, as well as officials of the many organizations that receive substantial federal money

Authorizes $25 million over each of the next four years to give federal investigators and prosecutors needed resources to go after public corruption.

Original article posted here.