Wednesday, August 13, 2008

$141b: US bill for Iraq war contractors

Aug 13, 2008

Such outsourcing fuels charges of overbilling, fraud and shoddy work
WASHINGTON: The United States has spent US$100 billion (S$141 billion) or more on contractors in Iraq since the invasion in 2003, a milestone that reflects the Bush administration's unprecedented level of dependence on private firms for help in the war, a government report has said.

The report - due to be released yesterday by the Congressional Budget Office - said that one out of every five dollars spent on the war in Iraq has gone to contractors for the US military and other government agencies, sources said.

The Pentagon's reliance on outside contractors in Iraq - where employees of private contractors now outnumber American troops - is proportionately far larger than in any previous conflict, and it has fuelled charges that this outsourcing has led to overbilling, fraud as well as shoddy and unsafe work that has endangered and even killed American troops.

The role of armed security contractors has also raised new legal and political questions about whether the US has become too dependent on private armed forces on the 21st-century battlefield.

The budget office's report found that from 2003 to 2007, the government awarded contracts in Iraq worth about US$85 billion, and that the administration was now awarding contracts at a rate of US$15 billion to US$20 billion a year. At that pace, contracting costs will surge past the US$100 billion mark this year.

Through last year, spending on outside contractors accounted for 20 per cent of the total costs of the war, the budget office found, according to people with knowledge of the report.

Several outside experts on contracting said that the report's numbers seemed to provide the first official price tag on contracting in Iraq and raised troubling questions about the degree to which the war had been privatised.

Contractors in Iraq now employ at least 180,000 people in the country, forming what amounts to a second, private army, larger than the US military force, and one whose roles and missions and even casualties among its work force have largely been hidden from public view.

The widespread use of these employees as bodyguards, translators, drivers, construction workers and cooks has allowed the administration to hold down the number of military personnel sent to Iraq, helping to avoid a draft.

In addition, the dependence on private companies to support the war effort has led to questions about whether political favouritism has played a role in the awarding of multibillion-dollar contracts.

When the war began, for example, KBR, a subsidiary of Halliburton, the Houston firm run by Mr Dick Cheney before he became Vice-President, became the largest Pentagon contractor in Iraq. After enduring years of criticism and scrutiny over its role in Iraq, Halliburton finally sold off KBR which is still the largest defence contractor in the war, and has 40,000 employees in Iraq.

'This is the first war that the United States has fought where so many of the people and resources involved aren't of the military, but from contractors,' said Professor Charles Tiefer, from the University of Baltimore Law School and a member of an independent commission created by Congress to study contracting in Iraq and Afghanistan.

'This is unprecedented,' he added.


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