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Military Contracts in Afghanistan Demonstrate Profound Failure of Government Oversight

Sen. Claire McCaskill (D-MO)

A common theme in almost all stories about the quagmire in Afghanistan is that widespread corruption is crippling the country. For example, Reuters has a fresh story on that topic today:

Afghanistan’s government came under fresh pressure on Thursday to tackle widespread graft after a survey found soaring corruption was giving political strength to Taliban insurgents ahead of a fresh U.S. and NATO war push.

Corruption in the country had more than doubled since 2007 and nine years after the start of the war to oust the Taliban, was now at levels well above fundamentalist rule, costing $1 billion a year in an $11 billion economy.

One in seven Afghans now regularly paid bribes.

But the graft in Afghanistan is not limited to the Afghan government. As Carlotta Gall writes in today’s New York Times, US companies are stealing from Afghan businesses:

A number of Afghan construction companies working on contracts for American and NATO military bases in Afghanistan have accused American middlemen of reneging on payments for supplies and services, and in one case of leaving the country owing Afghan companies hundreds of thousands, even millions, of dollars.

The failure of American companies to pay for contracted work has left hundreds of Afghan workers unpaid in southern Afghanistan, and dozens of factories and small businesses so deep in debt that Afghan and foreign officials fear the fallout will undermine the United States-led counterinsurgency effort to win the support of the Afghan people.

It’s hard to imagine an example of disaster capitalism that is more disgusting. US firms are taking large contracts from ISAF, hiring Afghan businesses as subcontractors and then pocketing the money without paying the Afghans for their work. Gall quotes one ISAF representative on the impact of this practice: “Without being too dramatic, American contractors are contributing to fueling the insurgency”.

Why would American companies do this? The easy answer is because the Afghans have no recourse:

“The subcontractors out here are very unlikely to be able to hire an attorney in the U.S., and thus the chances of seeing any payment is really zero,” the ISAF military official said.

Wait. What?

ISAF hires American companies to carry out work. The American companies subcontract to Afghans. The Afghans do the work and the American companies pocket the payment, stiffing the Afghans. And ISAF says the only way the Afghans can get paid is to hire an attorney in the US?

What’s missing in the description above is any understanding of ISAF’s responsibility to enforce the contracts it writes. But accountability was just one of many things discarded when George W. Bush’s Defense Secretary, Donald Rumsfeld, decided that the wars in Iraq and Aghanistan could be fought on the cheap.

Recall that even subcontracted security is a target for graft by US companies.

But not to worry. Senator Claire McCaskill (D-MO), told us back in February in Federal Computer Week that the military learned its lessons about contracting from its bad experience in Iraq:

Sen. Claire McCaskill (D-Mo.) said today U.S. military forces based in Afghanistan are doing a much better job of tracking contracts and purchases than they did in Iraq.

Military officers and officials from other agencies are coming together regularly to look at their auditing work, McCaskill said. Members of what are considered auditing committees are checking their audits to make sure they were done correctly. The committees are hunting for gaps in auditing oversight, but also avoiding the duplication of each other’s work, she said in a conference call from New Delhi, India.

The article quotes McCaskill admitting that contracting oversight in Iraq “has been essentially nonexistent” so much that “It was the wild west”.

As for Afghanistan, the article then begins to walk back from its opening claim that the military is doing “a much better job of tracking contracts”, attributing to McCaskill an observation that the military “improved slightly regarding audits and contracting oversight”. Then we have this at the close of the article:

“I don’t think they’ve got a handle on it, but I think they’re working to get a handle on it,” said McCaskill, a member of the Senate Armed Services Committee and chairwoman of the Senate Homeland Security Contracting Oversight Subcommittee.

Yeah, “working to get a handle on it” is considerably short of a “much better job” if you ask me. Great job of oversight you’re doing there, Senator.

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Military Contracts in Afghanistan Demonstrate Profound Failure of Government Oversight

Senator Claire McCaskill

A common theme in almost all stories about the quagmire in Afghanistan is that widespread corruption is crippling the country. For example, Reuters has a fresh story on that topic today:

Afghanistan’s government came under fresh pressure on Thursday to tackle widespread graft after a survey found soaring corruption was giving political strength to Taliban insurgents ahead of a fresh U.S. and NATO war push.

Corruption in the country had more than doubled since 2007 and nine years after the start of the war to oust the Taliban, was now at levels well above fundamentalist rule, costing $1 billion a year in an $11 billion economy.

One in seven Afghans now regularly paid bribes.

But the graft in Afghanistan is not limited to the Afghan government. As Carlotta Gall writes in today’s New York Times, US companies are stealing from Afghan businesses:

A number of Afghan construction companies working on contracts for American and NATO military bases in Afghanistan have accused American middlemen of reneging on payments for supplies and services, and in one case of leaving the country owing Afghan companies hundreds of thousands, even millions, of dollars.

The failure of American companies to pay for contracted work has left hundreds of Afghan workers unpaid in southern Afghanistan, and dozens of factories and small businesses so deep in debt that Afghan and foreign officials fear the fallout will undermine the United States-led counterinsurgency effort to win the support of the Afghan people.

It’s hard to imagine an example of disaster capitalism that is more disgusting. US firms are taking large contracts from ISAF, hiring Afghan businesses as subcontractors and then pocketing the money without paying the Afghans for their work. Gall quotes one ISAF representative on the impact of this practice: "Without being too dramatic, American contractors are contributing to fueling the insurgency".

Why would American companies do this? The easy answer is because the Afghans have no recourse:

“The subcontractors out here are very unlikely to be able to hire an attorney in the U.S., and thus the chances of seeing any payment is really zero,” the ISAF military official said.

Wait. What?

(more…)

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Jim White

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