Newshoggers.com

Army "Overlooked" Contracting Wunderkind's Past

By Cernig

More today on the remarkable case of the Florida-based contractor given a $300 million deal last year to provide ammunition to US forces and their local allies in Afghanistan - ammunition that proved to be Chinese crap too old to fire redirected through and repackaged in Albania.

The New York Times reports:

A Congressional committee revealed Tuesday that by the time the Army awarded the bid, State and Defense Department officials had canceled or delayed at least six earlier contracts with the company, AEY Inc., for poor quality or late deliveries.

But that record, including a botched $5.6 million order for 10,000 Beretta pistols for Iraq’s security forces, was either ignored or omitted from databases that American military contracting officials have used to weed out companies suspected of involvement in suspect arms deals.

...House investigators have also gathered testimony that the American ambassador to Albania, John L. Withers II, helped cover up the illegal Chinese origins of ammunition that AEY was shipping from Albania to Afghanistan under the Army contract.

...House investigators determined that Melanie A. Johnson, a contracting officer with the Army Sustainment Command, had overruled a contracting team that raised concerns about AEY’s inexperience and had concluded that there was “substantial doubt” that the company could fulfill the contract.

Investigators said Ms. Johnson had later acknowledged to them that she was unaware of the poor past performance of AEY, including the Beretta contract, when she awarded the company the Afghan bid.

Henry Waxman has asked “How did a company run by a 21-year-old president and a 25-year-old former masseur get a sensitive $300 million contract to supply ammunition to Afghan forces?” I suggest he follows the money. There have been enough other cases of contractors bribing US officials and military officers to gain contracts or to overlook shoddy performance (shoddy, but far more lucrative) that corruption rather than plain incompetence cannot be ruled out. I've another question Mr Waxman should be asking, after reports of the White House and senior administration officials blocking investigations: "How high does the graft and corruption go?"

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.

Media morons inartfully dodge their malfeasance

By Libby

While I remain completely unimpressed by McLellan's mea culpa, I'm liking that our malingering media are being forced to account for their own failures to inform the public of the deceits leading up to the invasion of Iraq. Not that they're taking the scrutiny particularly seriously. The major culprits are laughing it off and adding insult to injury.

Politico reporter Mike Allen, formerly of The Washington Post and Time, appeared yesterday on the show of right-wing radio host Mike Gallagher. The two of them guffawed together at how absurd are Scott McCellan's claims that the media was "deferential" to the Bush administration and then Allen said this:

ALLEN: And indeed, Scott does adopt the vocabulary, rhetoric of the left wing haters. Can you believe it in here he says the White House press corps was too deferential to the administration?

This was exactly the narrative they were plying back then that allowed this disaster to occur. Anyone who dared question the White House lies was a left wing hater and besides it's not their job to question authority. They were of the mind that they deserved their bloated salaries for mere stenography. And it wasn't just in the runup to the invasion that they failed us. They continued their fluffing right through the 04 elections. One had to go to the foreign press to find a functioning media. Take for instance, the attack on Richard Clarke, who blew the whistle on Bush's long pre-planned invasion of Iraq.

The swiftness and ferocity of the Bush White House's attack on Richard Clarke tells you two things: his story may be largely true, and the Bush administration is terrified that the American people will believe it. [...]

The White House did not let a single news cycle go by before questioning that the alleged encounter between the president and Clarke had ever taken place, assigning dark motives to a man who has served four presidents, three of them Republicans.

And the self-serving US media stars, along with their pet neo-cons, jumped right in with their long knives to stab Clarke in the back. Small wonder so few thereafter showed any similiar courage, although the knowledge of the deceptions was widespread.

"The conversation absolutely took place. I was there, but you can't name me," the witness said. "I was one of several people present. There was no doubt in anyone's mind that the president had Iraq on his mind, first and foremost." This former national security council official was too terrified to go on the record - he knows how vengeful this administration can be.

Former treasury secretary Paul O'Neill paid the price for truthtelling with his account of "how the Bush White House set its sights on Iraq from day one." Rumsfeld threatened him and when he failed to kowtow, he "instantly became the target of an investigation by his former department, which claimed that he had revealed state secrets."

Yet the facts were obvious and irrefutable. "The fact that the Pentagon pulled the fighting force most equipped for hunting down Osama bin Laden from Afghanistan in March 2002 in order to pre- position it for Iraq cannot be denied." After spending five months establishing rapport on the ground in Afghanistan, the elite unit was given two days notice to turn over their mission to those most ill-equipped to carry it out. But this was probably the most egregious failure.

Along with the redeployment of human assets came a reallocation of sophisticated hardware. The US air force has only two specially-equipped RC135 U spy planes. They had successfully vectored in on al-Qaida leadership radio transmissions and cellphone calls, but they would no longer circle over the mountains of the Pakistan/Afghanistan border.

We had AQ in our sights. We could have taken out bin Laden, actually won the so-called on terror right there, but Bush had other priorites, long in the planning. Back then, few expected our media to become so complicit in the lie, but they not only allowed the Bush administration to proclaim "it was the only qualified protector of national security," they actively persecuted the truthtellers on the administration's behalf. The Guardian said then that, "Sooner or later - and certainly before November - that truth will out." But it didn't out, it was buried in reams of White House press releases dutifully transcribed by a craven press corps too enamored of their own place on the guest lists of the powerful to do their duty to their profession or the American people.

Yesterday, Scott McClellan ran into Richard Clarke and apologized for denouncing Clarke's book at the time. That's not enough by a mile. He should set up on a street corner and apologize to every family who lost a loved one in this occupation, to every soldier who came home broken and to every Iraqi who lost everything to the lies he perpetrated in service to his former masters.

But really, that's even not enough. Almost the entire corporate media not only failed to tell the truth, they actively worked to destroy anyone brave to do so on the public record. There's no apology, no penance great enough to undo the damage and destruction caused by the negligence of McLellan and all those of his ilk in the punditry who enthusiastically 'created the reality' the White House demanded. In a sane world they would have long ago been relieved of their microphones and banished from civil society.

Nice Slush Fund....

By Fester

Some of my colleagues have already hit up the reporting on massive unaccountabilities in US spending in Iraq. BJ noted that it is absurdist theatre for accountants:

Controls, the saying goes, are there to keep honest people honest. Without them, nearly everyone strays, and the fact that oversight and spending controls have been allowed to lapse in just about every government function is one of the most pervasive legacies the Bush administration is going to leave the American people.

The highly knowledgable and respected budget analyst, Stan Collender, is looking at these stories and proclaiming a general financial scandal on the order of Credit Mobilier or Teapot Dome.  The amount of money involved makes most political scandals, including the $90,000 frozen cash found in Rep. Jefferson's (D-LA) freezer scandal and Jack Abramoff, look like mere pikers:

But this story from Friday's Washington Post, which talks about $15 billion in spending on Iraq that can't be accounted for properly, or in some cases at all, shows that the other stage of federal budgeting -- implementation -- is similarly broken, not working properly, and...well...you certainly get this picture as well.

In fact, it appears as if virtually every procedure and law designed to prevent just this type of malfeasance was circumvented....

...The Pentagon's own inspector general confirmed that this lack of concern for procedural safeguards was blatant and commonplace.  That makes it hard to come to any conclusion other than that they were ignored rather than expedited or poorly executed.

It's also hard to come to any conclusion other than that the spending of taxpayer funds in Iraq bordered on, or actually was, simple and straightforward corruption. 

Given the magnitude of the spending involved, Iraq may be the Bush administration's contribution to the biggest public corruption scandals of all time like Boss Tweed in New York, James Michael Curley in Boston, and Teapot Dome.

Occams' Razor suggests that the Mayberry Machiavellis saw unaccountability as a feature and not a bug.  Simplest explanation is that this $15,000,000,000 was a slush fund on the public tab and was intended as such.  Minimizing accounting and record keeping requirements makes tracing the money damn near impossible. 

Good Job Ohio Dems

By Fester:

Ohio Democrats are sending a real and differentiating signal that should reflect strongly on them when compared to Ohio Republicans.  Ohio Democrats recognize a massive ethics/impropriety situation and are doing something about it by drawing up articles of impeachment against the Democratic state Attorney General:

                House Democrats filed articles of impeachment this morning against Attorney General Marc Dann, charging him with nine counts relating to a sexual harassment scandal that has led to widespread calls for him to resign.

The articles, sponsored by 42 of 45 House Democrats, contend that Dann warrants impeachment for "misconduct in office rising to the level of malfeasance, neglect, nonfeasance, gross neglect of duty, improper exercise of authority and gross immorality."

A pattern is emerging at the state level.  State Democrats are looking at impropriety, corruption and scandals and not trying to defend it.  We saw this with Eliot Spitzer, we saw it in North Carolina and we are seeing this in Ohio.  As I wrote in regards to North Carolina these actions are strong contrasting actions, good politics and good policy:

This is good government, good sense and good politics as almost everyone involved can point out a concrete action that they took against self-dealing.  It also serves as a deterrent to anyone who is interested in self-dealing.  Good job North Carolina, and I wish Congress would take similiar actions against multiple members (from each party) as that would help restore some public trust in the institution.

Keep this up and credibility on good governance will increase and voter cynicism will decrease thus blurring strategies will be less effective.

Tainted by Torture

By Fester:

MSNBC is reporting that one of the military commission/tribunals has been cancelled against the alleged 20th hijacker as the entire trial and evidence chain has been tainted by torture:

The Pentagon has dropped charges against a Saudi at Guantanamo who was alleged to have been the so-called "20th hijacker" in the Sept. 11 attacks, his U.S. military defense lawyer said Monday...

But in reviewing the case, the convening authority for military commissions, Susan Crawford, decided to dismiss the charges against al-Qahtani...

The attorney said he could not comment on the reasons for the dismissal until discussing the case with lawyers for the other five defendants. Officials previously said al-Qahtani had been subjected to a harsh interrogation authorized by former Defense Secretary Donald H. Rumsfeld.

This is what happens when we as a country lack the balls to follow our own rules and basic societal norms.  If the case against Qahtani was solid it could have been proven in the same damn way that the case against the original WTC bombers was proven --- meticulous work within a framework of law.  That worked and that increased the legitimacy and prestige of the United States because we acted with justice instead of vengeance.  We acted with restraint instead of fear. And that restraint strengthened us. 

This amazing lack of faith in American institutions still astounds be at times coming from such dime story patriots and nationalistic tinged messaging machines.  America 's restraint and faith in the rule of law is a strength and not a weakness.  Today torture is an embarrassment  whose stain can not be easily removed even as it lessens our credibility, legitimacy and moral orientation.  Grow some balls America, and believe in your principals again. 

Torture in court

By Fester:

Torture is something that has gone from verboten to encouraged as 'it could never happen to us' combined with the fear of post-9/11 and the Green Lantern Theory of geopolitics where will and tough guy swagger replace intellect, intelligence and maneuvering.  It is something that we have swept under the rug as a wrong and instead dismissed it as a fraternity prank committed by a few bad apples from Appalachia and not authorized and prescribed by most of the Presidential line of succession.  Convenient fictions that are hurting our ability to see and accept reality as it is instead of as we wish it to be. 

The Associated Press is highlighting an interesting case that is going forward in Los Angeles District Court that seeks to expose and acknowledge torture as a US government policy through either active agency or implied agency in that the US government contract monitors knew it was going on for months and did nothing, thereby authorizing action by their inaction.  An Iraqi man is suing two US based contracting firms for the pattern and acts of torture committed against him by their employees. 

Emad al-Janabi's federal lawsuit, filed Monday in Los Angeles, claims that employees of CACI International Inc. and L-3 Communications Holdings Inc. punched him, slammed him into walls, hung him from a bed frame and kept him naked and handcuffed in his cell beginning in September 2003.

Also named as a defendant is CACI interrogator Steven Stefanowicz, known as "Big Steve." The suit claims he directed some of the torture tactics...

The firms provided interrogators or interpreters to assist U.S. military guards at Abu Ghraib, which became notorious when photos made public in early 2004 showing U.S. soldiers abusing and humiliating detainees. Military investigators later concluded that much of the abuse happened in late 2003 — when CACI and Titan's interrogators were at the prison...

Al-Janabi, 43, said he was detained by U.S. troops during a late-night raid in which he and his family were beaten by their captors. He said he was taken to a military base where he was stripped naked, a hood was placed on his head and his hands and legs were chained....

The lawsuit also claims the contractors conspired in a cover-up by destroying documents and other information, hid prisoners during periodic checks by the International Red Cross and misled military and government officials about what was happening at Abu Ghraib.

Al-Janabi was released in July 2004 and wasn't charged with any crime,

Although I am curious if this case will go forward as we have seen numerous instances of US citizens alleging crimes, up to and including capital war crimes such as rape that have occurred in Iraq during this same time period and yet the US court system has treated Iraq as a legal black hole.  Some of that is due to the presence of signed arbitration agreements but some of it has been by very creative results orientated lawyering. 

Gas tax holidays and government delegitimatization

By Fester:

The proposed gas tax holiday is a dumb and counterproductive policy and political idea.  It will lead to significant windfall transfers to producers while creating minimal new supplies and minimal decreases in counter-factual prices.  It is a cheap gimmick that masks that lack of relevant policy option space.  I expect that from the McCain campaign as Republicans have an ideological opposition to the notion that government can envision, plan, create and run successful policy programs that are not related to who is sleeping with whom.  However the short term pig-piling on by Senator Clinton is damaging to the Democratic brand and belief that government can and should be able to have a positive impact on society and daily life by successful program and policy implementation.

Professor Pollkatz notes that the price of gas is an excellent inverse predictor of Bush's popularity and he offers an intriguing hypothesis to explain this correlation:

The connection between gas prices and presidential approval is not (simply) that Bush is connected to Big Oil.  It's that the price of gasoline is just about the only Federal policy result non-wonks see and can relate to on a day-to-day basis.  Tax cuts?  Most people don't even know how much tax they pay.  War and defense?  Affects foreigners and National Guard families, not the rest of us.  But gasoline price displays, changing daily, hit people directly where they live.  And they blame Bush.

Everything else in government is too damn big or too damn disguised to be reflective of the federal government's ability to be an effective provider of public goods.  We saw this with the disconnect between people with Medicare who strongly like Medicare as it is currently constituted, and an ideological disposition against any expansion of a Medicare like program as 'big government intrusion.  Milton Friedman regrets working on the withholding of income taxes as people just accept the deductions and look at their take home pay. 

The most optimistic quick estimate of the impact of the proposed gas tax holiday is consumers would see a nine cent reduction, all else being held equal, for three months.  This estimate is being made by Menzie Chinn at Econbrowser:

Assume both supply and demand are equally price inelastic, and this means the incidence of the Federal tax is about 50-50. Eliminating the gasoline tax for a short duration gives a windfall to both consumers and producers, of about equal proportion. (By the way, this conclusion is not true of state gasoline taxes; see Chouinard and Perloff (2004)).

Paul Krugman is arguing that consumers will see, all else being equal, minimal to no changes in counter factual prices due to the very short run supply elasticities. 

Why doesn’t cutting the gas tax this summer make sense? It’s Econ 101 tax incidence theory: if the supply of a good is more or less unresponsive to the price, the price to consumers will always rise until the quantity demanded falls to match the quantity supplied. Cut taxes, and all that happens is that the pretax price rises by the same amount. The McCain gas tax plan is a giveaway to oil companies, disguised as a gift to consumers.

Is the supply of gasoline really fixed? For this coming summer, it is. Refineries normally run flat out in the summer, the season of peak driving. Any elasticity in the supply comes earlier in the year, when refiners decide how much to put in inventories. The McCain/Clinton gas tax proposal comes too late for that.

The reasonably most optimistic argument is for a nine cent per gallon reduction in prices due to the policy change while a pessimistic take is projecting minimal to no reduction in prices due to the policy change compared to what they otherwise would have been.  At $3.60 a gallon for regular unleaded, this is a decrease in price of between 0% and 2.6%.  I currently get a better per gallon discount on my grocery store loyalty card reward program.   

And gas prices will not be at $3.60 per gallon.  Instead the combination of continual instability in oil producing regions, and typical seasonal increases in demand will continue to drive prices up as there is no slack in the supply chain.  If the tax holiday is introduced, people will see little to no real impact; at most they would see a slightly slower increase in the price of gas than they otherwise would have seen.

This would be a political victory for McCain as he can claim that he 'did something!' At the same time it is an ideological victory as it can be construed as yet another demonstration that the federal government is inherently ineffective and should not be in the business of devising policies.   And that works fine for a Republican.  However the same implicit comparison would be drawn for the Democrat, Hillary Clinton, and it is here I have a problem with the construction of political arbitrage.  Mild, transient and expedient personal political gain is privatized while the costs of reducing the value of the Democratic brand and a core belief are borne by the entire party. 

Nothing to brag about at Fort Bragg

By Libby

Brandon Friedman uncovers the latest outrageous failure of our government to take care of the men and women that lay their lives on the line every single day for years on end, for the sole purpose of protecting the folly otherwise known as the Bush Doctrine. I don't know how anyone could watch this video without becoming outraged at the way the Pentagon 'rewards' our troops for their service with this kind of maltreatment when they get home. If you don't want to watch the whole ten minutes, at least scroll to the last two to see the soldier who just got back from 15 months of hazardous duty in Afghanistan and ends up having to stand in a sink while trying to unclog a drain to get rid of the three inches of raw sewage from overflowed toilets that is pooling on the floor.

As Brandon said, "America has three-quarters of a billion dollars to spend on the embassy in Baghdad, but our troops have to live like this. It's a disgrace."  Call your Congresslizards and tell them to do something about this travesty.

Increasing rates of greenhouse emissions

By Fester

The first rule of getting out of a hole is to stop digging any deeper.  The second rule is to start filling in the hole by creating a controlled collapse of option space. 

We are still digging a deeper hole with greenhouse gas levels and the digging has increased in speed and impact as we get closer and closer to tipping points that could cascade in destructive, non-linear fashion.  Science daily.com is reporting that the atmospheric concentration of carbon dioxide has increased by 2.5 parts per million in the past year to a total of 385 ppm.

Viewed another way, last year’s carbon dioxide increase means 2.4 molecules of the gas were added to every million molecules of air, boosting the global concentration to nearly 385 parts per million (ppm). Pre-industrial carbon dioxide levels hovered around 280 ppm until 1850. Human activities pushed those levels up to 380 ppm by early 2006.

The rate of increase in carbon dioxide concentrations accelerated over recent decades along with fossil fuel emissions. Since 2000, annual increases of two ppm or more have been common, compared with 1.5 ppm per year in the 1980s and less than one ppm per year during the 1960s.

One of the major contributors to the faster rise in atmospheric CO2 and methane concentrations is the melting of permafrost and tundra regions due to previous global warming.  These areas are releasing more greenhouse gases into the air while absorbing fewer gases.  This is an example of a short term positive feedback loop where increased emissions leads to warming which leads to more emissions and thus more warming.

One of the major concerns is a rapid disruption of the ocean currents and the transfer of thermal energy from the topics to the temperate and sub-arctic regions.  The Antarctica currents are becoming less salty and less dense which means cold water may sink slower and that would slow down the tropical to sub-tropical energy transfer.    If this actually occurs, most of Europe will have Russian style winters and the Indian Ocean becomes significantly cooler as well which would disrupt the monsoon systems that water the crops for 25% of the world's population.

We are seeing increasing costs become more probable and yet we are still increasing the size and the difficulty of corrective action or at least mitigating action.