The Ghost of Truman: The Wartime Contracting Commission Gives DOD Hell on Iraq Contracting

[laststeamtrain]

Dina Rasor

Federal fraud investigator, author, and head of Follow the Money Project
Posted: August 13, 2009 11:50 AM

The Ghost of Truman: The Wartime Contracting Commission Gives DOD Hell on Iraq Contracting

I felt the usual dread as I settled down to watch the hearings by the congressional Wartime Contracting Commission on Tuesday and Wednesday. I have now spent thirty years listening to hearing after hearing on the horrors of military procurement and have been up to my ears the last five years in Iraq war contracting fraud.

I expected the usual Kabuki dance. The DOD bureaucrats give droning testimony about how there was a problem but that they were fixing it on a time multiplex basis. The members of Congress or a commission ask well prepared questions after their initial opening statements saying how outraged they are but are unable to ask detailed follow up questions as the witnesses go into unnecessarily complex procurement speak. Then the bureaucrats and the companies promise to do better and the members can give some good quotes to any reporters who happen to be covering the hearing. It turns out to be a one-day wonder with a couple of articles and everyone feels that they have done their civic duty. Meanwhile, the procurement problems remain, year after year, with the bureaucracy knowing that they can go on business as usual and the troops and the taxpayers take it in the neck.

But the ghost of Harry Truman, must have been lurking in the hearing room. This commission was fashioned after his famous Truman Committee that during World War II went after dishonest contractors with a vengeance, recovering amazing amounts of money and actually putting a general in jail. I watched as the commissioners, under the co-chairmanship of Christopher Shays and Michael Thibault, grill the witnesses from the Army Contractor Command, the Defense Contract Audit Agency (DCAA) and the Defense Contract Management Agency (DCMA) about the notorious LOGCAP contracts, where in one of them, LOGCAP III, KBR has committed enormous waste and fraud that has been publicized for years without serious challenge.

<snip>

Meanwhile, in these sixty days and beyond, the contractor meter, especially KBR's, just keeps on running at full speed, costing us hundreds of millions of dollars. Most of what I heard in these hearings, I have heard before while researching my book, Betraying Our Troops: the Destructive Results of Privatizing War. In that research, we found that KBR not only had too many people just sitting around with not enough to do, but that they were illegally billing twelve hours a day, seven days a week which was not allowed in the contract. That is how you can charge $32 billion dollars to do ordinary tasks such as feeding the troops, driving trucks, and maintaining buildings.

The Commission will continue their work to try to stop the rampaging water flow of dollars in these contracts, but there will be a permanent base of fraud and waste unless the government goes after the money that has already been illegally gotten. This waste and fraud will affect all future contracts with contractors in the war zone because the DOD uses historic costs to determine how much future contracts will be. So if you don't go back and scrubbed the numbers for unallowable and/or illegal costs, KBR's and other contractor's outrageous spending in these past six years will became the new normal, even if you get other companies to do the work. According to information at the hearing, Dyncorp, the contractor who will replace KBR in Afghanistan, bid low to win the contact but now has told the Army that they have to charge 50 percent more for their labor costs. They are hiring many of the KBR employees in Afghanistan and are finding that they have to pay them KBR inflated rates.

<snip>

If the past money is not recovered, the fraud and waste of the first six years of these wars will be institutionalized in future war support contracts. The Commission has given me some hope that they plan to follow up and drill down to the bottom of this problem but unless the DOD departments and the DOJ are pressured to recover the ill gotten goods, the high billings will remain and the companies will think it is business as usual. If Truman style of this Commission remains, real history could be made and contractors would be finally brought to task. I will report back in 60 days.

<more>

http://www.huffingtonpost.com/dina-rasor/the-ghost-of-truman-the-w_b_258617.html