Some might call it corporate-miltary corruption

By Libby

Some might call it a crime, but at the Pentagon this is called business as usual. An army official, who recently retired, comes forward with an all too common tale of privatized corruption in military contracting. Unsurprisingly, it involves Pentagon fav, KBR -- a former subsidary of Halliburton. We're not talking pocket change here, even by government standards.

Charles M. Smith oversaw the contracts and reveals today he was removed from his position after refusing to pay substantial undocumented charges from the corporate behemoth.

Army auditors had determined that KBR lacked credible data or records for more than $1 billion in spending, so Mr. Smith refused to sign off on the payments to the company. “They had a gigantic amount of costs they couldn’t justify,” he said in an interview. “Ultimately, the money that was going to KBR was money being taken away from the troops, and I wasn’t going to do that.”

But he was suddenly replaced, he said, and his successors — after taking the unusual step of hiring an outside contractor to consider KBR’s claims — approved most of the payments he had tried to block.

The Army says they had no choice but to cave into KBR's extortion.

Army officials denied that Mr. Smith had been removed because of the dispute, but confirmed that they had reversed his decision, arguing that blocking the payments to KBR would have eroded basic services to troops. They said that KBR had warned that if it was not paid, it would reduce payments to subcontractors, which in turn would cut back on services.

Got that? This patriotic supplier on the privatization gravy train was willing to starve the troops in order to get their blackmail money. Hell, I bet even the mafia has higher moral standards than that. But of course, the administration having been burned by this highway robbery will now find a new contractor to deliver the services, won't they? Nope.

While it was previously reported that the Army had held up large payments to the company and then switched course, Mr. Smith has provided a glimpse of what happened inside the Army during the biggest showdown between the government and KBR. He is giving his account just as the Pentagon has recently awarded KBR part of a 10-year, $150 billion contract in Iraq.

Leaving aside the insanity of continuing to subsidize this privatized corruption, I'm wondering just why the Pentagon is entering into ten year contracts on Iraq when it's not at all clear the next president will be willing to stay that long. Either they know something we don't know about those 'non-permanent' bases, or this is one of the most blatant looting of tax dollars in the history of our country. Probably both. I imagine the buyout provisions should the occupation end in less than ten years is more than generous.

Hilzoy has more on the privatization angle.