Cronyism and Kickbacks

Ed Harriman on the economics of reconstruction in Iraq, in the London Review of Books:

4_6_05_usaid2_001The sums are simple. Reconstruction will cost considerably more than originally imagined. The American administration has committed most of its funds. The Iraqis have neither the money nor the expertise to run the projects that have been completed. There’s little transparency or accountability. To judge from the audits published so far, at least $12 billion spent by the Americans and by the Iraqi interim and transitional governments has not been properly accounted for. Almost three years after the fall of Saddam, the GAO reports, ‘it is unclear how US efforts are helping the Iraqi people obtain clean water, reliable electricity or competent healthcare.’ The Bush administration has decided to provide no more reconstruction funds.

The auditors who have discovered Iraq’s deepening financial crisis have been ignored. They asked the US ambassador and the US military commander in Iraq for their views. Neither replied. The US State Department was to submit estimates of how much it will cost to complete all American-funded projects in Iraq to the White House Office of Management and Budget. The Office won’t discuss the matter. Earlier this month, Brigadier-General William McCoy told reporters: ‘The US never intended to completely rebuild Iraq . . . This was just supposed to be a jump-start.’

More here.