New budget accounts for cost of Iraq and Afghanistan wars, adopting one of the key recommendations from Stiglitz-Bilmes

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President Obama’s new budget proposals have incorporated one of the core recommendations from the Three Trillion Dollar War, which is that the funding for Iraq and Afghanistan should be included in the budget estimate.   Under the Bush presidency, nearly all funding for the wars — which now totals some $900 billion — was appropriated outside the regular budget process through a series of “emergency supplemental” appropriations.

This mechanism, which was supposed to be used for genuine unexpected emergencies like hurricanes — had several pernicious effects.  First, it hid the true cost of the war. Every year, the President’s budget presented a charade in which everyone knew that the war spending was not included in the budget but would eventually be requested.  Second, money requested through the “emergency supplementaL” was subject to a less rigorous scrutiny than ordinary money, with the result that Congressional budget analysts of both parties had little time to analyze the billions of dollars worth of contracts and other spending. This is one of the reasons for the profiteering and other consequences.  Finally, and perhaps most importantly — the use of this funding trick meant that Congress never had to make any real choices or trade-offs between war spending and other spending.  Instead, Congress played along with this charade, spending money we don’t have.  This led to ballooning deficits and increased the national debt by nearly a trillion dollars.

Special IG Widens Investigation in to Iraq Reconstruction Graft

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February 15, 2009

Inquiry on Graft in Iraq Focuses on U.S. Officers

Federal authorities examining the early, chaotic days of the $125 billion American-led effort to rebuild Iraq have significantly broadened their inquiry to include senior American military officers who oversaw the program, according to interviews with senior government officials and court documents.

Court records show that last month investigators subpoenaed the personal bank records of Col. Anthony B. Bell, who is now retired from the Army but who was in charge of reconstruction contracting in Iraq in 2003 and 2004 when the small operation grew into a frenzied attempt to remake the country’s broken infrastructure. In addition, investigators are examining the activities of Lt. Col. Ronald W. Hirtle of the Air Force, who was a senior contracting officer in Baghdad in 2004, according to two federal officials involved in the inquiry.

It is not clear what specific evidence exists against the two men, and both said they had nothing to hide from investigators. Yet officials say that several criminal cases over the past few years point to widespread corruption in the operation the men helped to run. As part of the inquiry, the authorities are taking a fresh look at information given to them by Dale C. Stoffel, an American arms dealer and contractor who was killed in Iraq in late 2004.

Before he was shot on a road north of Baghdad, Mr. Stoffel drew a portrait worthy of a pulp crime novel: tens of thousands of dollars stuffed into pizza boxes and delivered surreptitiously to the American contracting offices in Baghdad, and payoffs made in paper sacks that were scattered in “dead drops” around the Green Zone, the nerve center of the United States government’s presence in Iraq, two senior federal officials said.

http://www.nytimes.com/2009/02/15/world/middleeast/15iraq.html

Recent work by Linda Bilmes has highlighted the long-term costs of veterans with mild brain injuries.  Summaries can be read in Neurology Today, Annals of Neurology, and Neurology Reviews.

http://www.neurotodayonline.com/pt/re/neurotoday/pdfhandler.00132985-200811060-00006.pdf;jsessionid=J

http://annalsofneurology.wordpress.com/2009/01/27/ana-symposium-examines-costs-lessons-of-iraq-conflict/

http://www.neurologyreviews.com/08dec/VetNeuro.html

Iraq kicks out Blackwater

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In a widely expected move, Iraq has refused to allow Blackwater (including the various Blackwater companies that have operated in Iraq since 2003) to continue working in the country.   This reflects the public sentiment in Iraq that blames Blackwater for the deaths of a number of civilians.  Throughout the war, Blackwater, a private security firm that employs mostly retired US military personnel, has been responsible for providing security to US diplomats and other officials.

Widespread Fraud in Iraq likely to be repeated in Afghanistan, according to new testimony by Inspector Generals

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The high level Washington Commission tasked with understanding many of the problems that occurred with contracting in Iraq has heard testimony from the Inspector General of the Pentagon, and the Special Inspector General for Iraq Reconstruction, that the situation in Afghanistan is likely to repeat the errors of Iraq unless significant changes are made to US contracting policies and methods.   See full article below in Army Times:

http://www.armytimes.com/news/2009/02/ap_war_spending_020209/
 

 

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