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Cronyism in US contracts clouds
fundraising
By Thalif Deen
NEW YORK - A recent political ad campaign
highlighting corruption and cronyism in US contracts
awarded to rebuild Iraq takes a shot at a major
corporation with ties to the White House.
According to the facetious political slogan
aired on US television, international donors were
offered a piece of unsolicited advice: "If you are
writing out checks, please make sure to spell
Halliburton with two 'l's".
The huge US-based
energy conglomerate, once headed by Vice President Dick
Cheney, has received more than US$2 billion in contracts
for the reconstruction of Iraq. But what is outrageous,
say analysts, is that Halliburton was awarded $1.2
billion in contracts on a non-competitive basis,
shutting out all other contractors.
"If the US
has abandoned the concept of transparency, which it so
assiduously preaches to others, how do you expect
international donors to dig deep into their pockets to
help in the reconstruction of Iraq?" asks one Asian
diplomat.
A second major US company, Bechtel
Corporation - with close ties to the administration of
President George W Bush - has also come under fire for
various irregularities relating to Iraqi contracts.
Clifford George Mumm, a senior Bechtel official in
Baghdad, has denied any irregularities in the 105
sub-contracts that the firm has signed with Iraqi
companies.
But Henry Waxman, a congressman from
the State of California, has accused the Bush
administration of wasting billions of dollars in
contracts with Halliburton and Bechtel "when Iraqi
companies could do the work for less".
Last
Thursday, the New York Times reported that two senior
Democratic congressmen were questioning if Halliburton
was overcharging the US government for supplying
gasoline in Iraq. In a letter to the White House Office
of Management and Budget, Waxman and Representative John
Dingell of Michigan said, "The overcharging by
Halliburton is so extreme that one expert has privately
called it 'highway robbery'."
The 15-member
European Union (EU) has called for a "separate and
transparent" fund to hold its money for Iraq. "It's not
a criticism of how the coalition operates, but if we're
putting money through an international fund, I'm not in
a position in which I have to answer questions on the
procurement policies of the [coalition-run] development
fund for Iraq," said EU External Relations Commissioner
Chris Patten earlier this month, according to Radio Free
Europe.
Spain, which is hosting a major
international donor conference from October 23-24, is
expecting about $6 billion in pledges for the
reconstruction of Iraq. "Unfortunately, the money will
not be spent 'to improve the lives of Iraqis' as the
Bush administration claims, but only to repair what was
wantonly broken by the invasion, and incidentally to
enrich US contractors," Jim Jennings, president of
Conscience International, told IPS.
Democratic
Senator Patrick Leahy has successfully pushed through
two amendments to a piece of legislation that will
require the US-run Coalition Provisional Authority (CPA)
in Baghdad to release monthly details of Iraq's oil
production and revenues, and also impose criminal
penalties against fraud in Iraq-related contracts.
Former UN assistant secretary general Hans Von
Sponeck, who headed the Iraq oil-for-food program, told
IPS that even the Iraqi budget administered by the CPA
lacks transparency. "Here's what I can say guardedly if
I were an Iraqi who wanted to understand how my
country's resources are allocated at this crucial
moment," he said.
The proposed Iraqi budget, he
said, includes a deficit of $2.2 billion, identified
with the comment "funded from committed financial
assets". "What are these committed financial assets?"
Von Sponeck asked.
"What has happened to the
cash the US army captured? Should it not be identified
as income in the 2003 budget? A very large amount of
money - $925 million - is identified as 'various
expenditures'. What are these 'various expenditures'?"
"The point I am trying to make is that we seem
to see the beginning of a lot of 'cover ups', which
needs to be strongly criticized," Von Sponeck added.
The Bush administration has sought about $87
billion from the US Congress for the reconstruction of
Iraq and Afghanistan. But it is desperately seeking
additional money from the donor community in an attempt
to share the huge burden.
The upcoming donor
conference in Madrid was expected to receive a moral
boost following the unanimous adoption of a Security
Council resolution last Thursday calling on UN member
states not only to provide troops for a new
multinational peacekeeping force in Iraq, but also to
provide money to rebuild the war-devastated country.
But in a joint statement issued after the
resolution was adopted, France, Germany and Russia said
pointedly that Washington has not created the conditions
necessary "to envisage any military commitment" or even
the offer of "further financial contributions beyond our
present engagement".
The three countries were
seeking greater sovereignty for Iraqis and also a major
role for the UN in the reconstruction of Iraq. The
resolution adopted on Thursday falls short on both
counts, they said.
The London Financial Times
quoted unnamed White House officials as saying that the
UN vote would not necessarily translate into large
financial contributions at the Madrid conference next
week. Japan has already indicated it will pledge about
$1.5 billion for next year, and up to about $5 billion
over the next five years.
The EU has already
approved about $233 million in reconstruction aid for
Iraq. But so far Britain is the only European nation
that is expected to provide additional funding - about
$439 million - from its 2003 and 2004 budgets.
(Inter Press Service)
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