Corruption in Iraq: A Budget Surplus but Unwilling to Share Security Costs

September 30th, 2010 - by admin

Joel Brinkley / San Francisco Chronicle & Steven Lee Myers / New York Times – 2010-09-30 22:53:16

Iraq Has Billions but
Won’t Pay Security Costs

Joel Brinkley / San Francisco Chronicle

(September 26, 2010) — American combat forces have left Iraq, but the bills for the war keep coming. Right now, Congress is debating an appropriation for $2 billion on top of $667 billion already spent on military operations and training since 2003.

Now, however, the sentiment is growing among senior government officials that Iraq should begin sharing these costs. The State, Treasury and Defense departments agree on this.

After all, in a report published last week, US government analysts found that Iraq had a budget surplus of $52.1 billion at the end of 2009. For the same period, Washington showed a budget deficit of $1.42 trillion. Why should the United States continue spending money on this oil-rich state?

If only it were that simple.

Apprised of the auditors’ findings, Iraq immediately objected. No, no, no, the Finance Ministry said. Most of that money, just over $40 billion, is already spent on cash loans and advances to — who knows? The Finance Ministry couldn’t say. It classifies almost half of the expenses as “other temporary advances.”

Not even Iraqi authorities are buying that dubious claim. An amount equal to the state budgets of Illinois and Indiana combined is just out there in the ether somewhere? Iraq’s Board of Supreme Audit issued the opinion that continuing to authorize these so-called advances could result in “the misappropriation of government funds,” otherwise known as corruption — or theft.

The International Monetary Fund demanded that Iraq identify where that $40 billion had gone and to begin recovering it by Sept. 30. That’s just a few days away. Don’t hold your breath.

One untraceable expense the Iraqis claimed was $16.9 billion for “orphans and government pensions.”

“I find that hard to believe, actually,” said Maxwell Quqa, president of the Sponsor Iraqi Children Foundation. Iraq has more than a million young orphans, but only one of every 1,000 of them is afforded anything more than minimal food and shelter. Many don’t go to school, Quqa told me. Hundreds live at city trash dumps. The ministry charged with helping orphans “is very ineffective. They don’t provide nearly enough to meet the needs of these children.”

By now it’s no secret that Iraq is one of the world’s most thoroughly corrupt states. In 2007, the American Embassy discovered that Iraq had embezzled $18 billion in American aid. I doubt Iraq has ever had a clean, functioning budget. So I wonder why, after seven years there, American officials still think they can change Iraq’s behavior.

Joseph Christoff, the government report’s lead analyst, is director of International Affairs and Trade for the Government Accountability Office, which published the study. “Clearly we come from a Western concept of accounting rules,” he told me. The United States “has struggled to offer them a modern financial management system, but they have resisted.

“Literally, I saw handwritten ledgers in the Finance Ministry,” and “some of the entries are in pencil” — better to erase the entries for the money you are stealing.

Remember, American auditors found this budget surplus. Publicly, Iraq projects a large deficit each year — $16 billion in 2009. You can imagine why. You can also assume that Prime Minister Nouri al-Maliki realizes that any successor who steps into his office will quickly discover the bright red trail of perfidy and turpitude his government left behind — one reason al-Maliki so tenaciously clings to office even now, more than six months after the election.

Even if you accept that the $40 billion in question is lost, gone, stashed in secret bank accounts in Dubai, that still leaves almost $12 billion in available surplus funds. Why can’t the United States insist that Iraq pick up that $2 billion expense for training and equipping Iraqi security forces?

“We agree” with the goal of “ensuring that Iraq shares in its security costs,” Colin Kahl, deputy assistant secretary of defense, told the Government Accounting Office. The State Department added: “We will certainly expect the Iraqi government to cover an increasing share of the costs.”

The United States has spent hundreds of billions of dollars, almost all of it deficit spending, while Iraqi officials purloined sums so grand that some of them probably outrank Bill Gates and Warren Buffett as the world’s richest men.

Other countries where American troops are stationed share the costs, including several that are far poorer than Iraq. Thailand and the Philippines, for example, provide cash payments, services and facilities for US military advisers. South Korea gives the United States $690 million a year to help defray the costs of stationing 28,000 troops there.

Why not Iraq?

© Tribune Media Services Inc.

Joel Brinkley, a professor of journalism at Stanford University, is a former Pulitzer Prize-winning foreign correspondent for the New York Times.

© 2010 Hearst Communications Inc.
Posted in accordance with Title 17, Section 107, US Code, for noncommercial, educational purposes.

US Gift to Iraqi Students Lost to Corruption
Steven Lee Myers / New York Times

BAGGDAD (September 26, 2010) — The shipment of computer laptops that arrived in Iraq’s main seaport in February was a small but important part of the American military’s mission here to win hearts and minds. What happened afterward is a tale of good intentions mugged by Iraq’s reality.

The computers — 8,080 in all, worth $1.8 million — were bought for schoolchildren in Babil, modern-day Babylon, a gift of the American taxpayers. Only they became mired for months in customs at the port, Umm Qasr, stalled by bureaucracy or venality, or some combination of the two. And then they were gone.

Corruption is so rampant here – and American reconstruction efforts so replete with their own mismanagement – that the fate of the computers could have ended as an anecdote in a familiar, if disturbing trend. Iraq, after all, ranks above only Sudan, Burma, Afghanistan and Somalia on Transparency International’s annual corruption index.

But the American military commander in southern Iraq, Maj. Gen. Vincent Brooks, was clearly furious. Even if the culprits are not exactly known, the victims are: Iraqi children and American taxpayers. He issued a rare and stinging public rebuke of a government that the United States hopes to treat as an equal, strategic partner — flawed, perhaps, but getting better.

The laptops arrived in two shipments, on Feb. 20 and Feb. 23. The original shipping documents mistakenly listed the computers’ destination as Umm Qasr, not Babil, which caused confusion. By April, though, the US military had tracked them down and repeatedly tried to clear them through customs and truck them to Babil.

Then, in August, Iraqis auctioned off 4,200 of the computers — for $45,700. The whereabouts of the rest are unknown.

Prodded by the Americans and Iraqi officials in Babil, Prime Minister Nouri al-Maliki ordered an investigation by the Commission on Integrity, a besieged independent watchdog whose investigations have led to clashes with al-Maliki and other senior officials.

In early September, the auctioned computers were recovered, according to Iraqi officials, who nevertheless declined to discuss how or where.

Last week there was another breakthrough — of a sort.

Iraqi officials in Basra and Baghdad said that arrest warrants had been issued for 10 customs employees at Umm Qasr, all low-level officials. Six were said to have been detained. The officials refused to identify them, though. Nor were the charges made public, leaving the details of the case as shrouded in mystery as many facts are in Iraq.

“We are still investigating,” an official from the Commission on Integrity said. “We cannot give anymore information now, but soon you will receive a lot of information about this issue.”

© 2010 Hearst Communications Inc.

Posted in accordance with Title 17, Section 107, US Code, for noncommercial, educational purposes.