RECKLESS MISSPENDING AND WASTE OF US TAX DOLLARS IN CONNECTION WITH IRAQ CONTRACTORS
In his conduct while President of the United States, George W. Bush, in violation of his constitutional
oath to faithfully execute the office of President of the United States and, to the best of his ability,
preserve, protect, and defend the Constitution of the United States, and in violation of his constitutional duty under Article II, Section 3 of the Constitution “to take care that the laws be faithfully executed”, has both personally and acting through his agents and subordinates, together with the Vice President, recklessly wasted public funds on contracts awarded to close associates, including companies guilty of defrauding the government in the past, contracts awarded without competitive bidding, “cost-plus” contracts designed to encourage cost overruns, and contracts not requiring satisfactory completion of the work. These failures have been the rule, not the exception, in the awarding of contracts for work in the United States and abroad over the past seven years.
Repeated exposure of fraud and waste has not been met by the president with correction of systemic problems, but rather with retribution against whistleblowers.
The House Committee on Oversight and Government Reform reported on Iraq reconstruction contracting:
“From the beginning, the Administration adopted a flawed contracting approach in Iraq. Instead of maximizing competition, the Administration opted to award no-bid, cost-plus contracts to politically connected contractors. Halliburton’s secret $7 billion contract to restore Iraq’s oil infrastructure is the prime example. Under this no-bid, cost-plus contract, Halliburton was reimbursed for its costs and then received an additional fee, which was a percentage of its costs. This created an incentive for Halliburton to run up its costs in order to increase its potential profit.
“Even after the Administration claimed it was awarding Iraq contracts competitively in early 2004, real
price competition was missing. Iraq was divided geographically and by economic sector into a handful
of fiefdoms. Individual contractors were then awarded monopoly contracts for all of the work within given fiefdoms. Because these monopoly contracts were awarded before specific projects were identified, there was no actual price competition for more than 2,000 projects.
“In the absence of price competition, rigorous government oversight becomes essential for accountability. Yet the Administration turned much of the contract oversight work over to private companies with blatant conflicts of interest. Oversight contractors oversaw their business partners and, in some cases, were placed in a position to assist their own construction work under separate monopoly construction contracts….
“Under Halliburton’s two largest Iraq contracts, Pentagon auditors found $1 billion in ‘questioned’ costs and over $400 million in ‘unsupported’ costs. Former Halliburton employees testified that the company charged $45 for cases of soda, billed $100 to clean 15- pound bags of laundry, and insisted on housing its staff as the five-star Kempinski hotel in Kuwait. Halliburton truck drivers testified that the company ‘torched’ brand new $85,000 trucks rather than perform relatively minor repairs and regular
maintenance. Halliburton procurement officials described the company’s informal motto in Iraq as ‘Don’t worry about price. It’s cost-plus.’ A Halliburton manager was indicted for ‘major fraud against the United States’ for allegedly billing more than $5.5 billion for work that should have cost only $685,000 in exchange for a $1 million kickback from a Kuwaiti subcontractor….
“The Air Force found that another U.S. government contractor, Custer Battles, set up shell subcontractors to inflate prices. Those overcharges were passed along to the U.S government under the company’s cost-plus contract to provide security for Baghdad International Airport. In one case, the company allegedly took Iraqi-owned forklifts, re-painted them, and leased them to the U.S.
“Despite the spending of billions of taxpayer dollars, U.S. reconstruction efforts in keys sectors of the
Iraqi economy are failing. Over two years after the U.S.-led invasion of Iraq, oil and electricity production has fallen below pre-war levels. The Administration has failed to even measure how many Iraqis lack access to drinkable water.”
“Constitution in Crisis,” a book by Congressman John Conyers, details the Bush Administration’s
response when contract abuse is made public:
“Bunnatine Greenhouse was the chief contracting officer at the Army Corps of Engineers, the agency that has managed much of the reconstruction work in Iraq. In October 2004, Ms. Greenhouse came forward and revealed that top Pentagon officials showed improper favoritism to Halliburton when awarding military contracts to Halliburton subsidiary Kellogg Brown & Root (KBR). Greenhouse stated that when the Pentagon awarded Halliburton a five-year $7 billion contract, it pressured her to withdraw her objections, actions which she claimed were unprecedented in her experience.
“On June 27, 2005, Ms. Greenhouse testified before Congress, detailing that the contract award process was compromised by improper influence by political appointees, participation by Halliburton officials in meetings where bidding requirements were discussed, and a lack of competition. She stated that the Halliburton contracts represented “the most blatant and improper contract abuse I have witnessed during the course of my professional career.” Days before the hearing, the acting general counsel of the Army Corps of Engineers paid Ms. Greenhouse a visit and reportedly let it be known that it would not be in her best interest to appear voluntarily.
“On August 27, 2005, the Army demoted Ms. Greenhouse, removing her from the elite Senior Executive Service and transferring her to a lesser job in the corps’ civil works division . As Frank Rich of The New York Times described the situation, ‘[H]er crime was not obstructing justice but pursuing it by vehemently questioning irregularities in the awarding of some $7 billion worth of no-bid contracts in Iraq to the Halliburton subsidiary Kellogg Brown Root.’ The demotion was in apparent retaliation for her speaking out against the abuses, even though she previously had stellar reviews and over 20 years of experience in military procurement.”
The House Committee on Oversight and Government Reform reports on domestic contracting:
“The Administration’s domestic contracting record is no better than its record on Iraq. Waste, fraud, and abuse appear to be the rule rather than the exception….
“A Transportation Security Administration (TSA) cost-plus contract with NCS Pearson, Inc., to hire federal airport screeners was plagued by poor management and egregious waste. Pentagon auditors challenged $303 million (over 40%) of the $741 million spent by Pearson under the contract. The auditors detailed numerous concerns with the charges of Pearson and its subcontractors, such as ‘$20- an-hour temporary workers billed to the government at $48 per hour, subcontractors who signed out $5,000 in cash at a time with no supporting documents, $377,273.75 in unsubstantiated long distance phone calls, $514,201 to rent tents that flooded in a rainstorm, [and] $4.4 million in “no show” fees for job candidates who did not appear for tests.’ A Pearson employee who supervised Pearson’s hiring efforts at 43 sites in the U.S. described the contract as ‘a waste a taxpayer’s money.’ The CEO of one Pearson subcontractor paid herself $5.4 million for nine months work and provided herself with a $270,000 pension….
“The Administration is spending $239 million on the Integrated Surveillance and Intelligence System, a
no-bid contract to provide thousands of cameras and sensors to monitor activity on the Mexican and
Canadian borders. Auditors found that the contractor, International Microwave Corp., billed for work it
never did and charged for equipment it never provided, ‘creat[ing] a potential for overpayments of almost $13 million.’ Moreover, the border monitoring system reportedly does not work….
“After spending more than $4.5 billion on screening equipment for the nation’s entry points, the
Department of Homeland Security is now ‘moving to replace or alter much of’ it because ‘it is
ineffective, unreliable or too expensive to operate.’ For example, radiation monitors at ports and
borders reportedly could not ‘differentiate between radiation emitted by a nuclear bomb and naturally
occurring radiation from everyday material like cat litter or ceramic tile.’…
“The TSA awarded Boeing a cost-plus contract to install over 1,000 explosive detection systems for
airline passenger luggage. After installation, the machines ‘began to register false alarms’ and ‘[s]creeners were forced to open and hand-check bags.’ To reduce the number of false alarms, the sensitivity of the machines was lowered, which reduced the effectiveness of the detectors. Despite these serious problems, Boeing received an $82 million profit that the Inspector General determined to be ‘excessive.’…
“The FBI spent $170 million on a ‘Virtual Case File’ system that does not operate as required. After three years of work under a cost-plus contract failed to produce a functional system, the FBI scrapped the program and began work on the new ‘Sentinel’ Case File System….
“The Department of Homeland Security Inspector General found that taxpayer dollars were being lavished on perks for agency officials. One IG report found that TSA spent over $400,000 on its first leader’s executive office suite. Another found that TSA spent $350,000 on a gold-plated gym….
“According to news reports, Pentagon auditors … examined a contract between the Transportation Security Administration (TSA) and Unisys, a technology and consulting company, for the upgrade of airport computer networks. Among other irregularities, government auditors found that Unisys may have overbilled for as much as 171,000 hours of labor and overtime by charging for employees at up to twice their actual rate of compensation. While the cost ceiling for the contract was set at $1 billion,
Unisys has reportedly billed the government $940 million with more than half of the seven-year contract remaining and more than half of the TSA-monitored airports still lacking upgraded networks.”
In all of these actions and decisions, President George W. Bush has acted in a manner contrary to his
trust as President, and subversive of constitutional government, to the prejudice of the cause of law and justice and to the manifest injury of the people of the United States. Wherefore, President George W. Bush, by such conduct, is guilty of an impeachable offense warranting removal from office.