March 9, 2006

War Profiteers Resolution
Talking Points

By CHARLIE CRAY
Center for Corporate Policy
ccray@corporatepolicy.org
www.corporatepolicy.org

** Congress has failed to provide adequate oversight or fully investigate charges of incompetence, waste, fraud, bribery and other reported abuses in Iraq. Without such oversight, not only are taxpayer dollars wasted, but both Iraq's transition to democracy and U.S. troops have been put at further risk, and contractors are rarely brought to justice.

** Proposals in Congress to establish a special committee modeled after Senator Harry Truman's World War II committee, which cost just thousands while saving $15 billion in 1940s' dollars, have been rejected three times in two years by the Senate.

** The Congressional Budget Office estimates that $320 billion has been spent on Iraq and Afghanistan since September 11, 2001, with the Bush administration asking Congress to approve another supplemental appropriation in 2006 worth $72 billion. .

** The Department of Defense has 149 contracts with 77 contractors in Iraq worth approximately $42.1 billion and funded at $25.4 billion as of May 2005. According to Defense Department auditors, Halliburton "represents 52% of the total contract value." (Defense Contract Audit Agency, Briefing Slides: DCAA Contract Audit Support for Iraq Reconstruction, May 3, 2005).

** Halliburton, and/or its employees and subcontractors are being investigated for numerous violations in Iraq and elsewhere, including criminal bid-rigging, overcharging of taxpayers, and bribery. (See http://www.hallibrtonwatch.org for details).

** Five defense lobbying groups, representing thousands of firms, including "some of the industry's biggest names, such as DynCorp International and Halliburton subsidiary KBR, both of which have been linked to trafficking-related concerns" have stalled a Pentagon proposal prohibiting defense contractor involvement in human trafficking for forced prostitution or labor. (Chicago Tribune, 12/27/05)

** The Pentagon and other contracting agencies have failed to provide adequate oversight, while routinely ignoring reports and recommendations from its own auditing arm. On February 27, 2006, for example, the Army decided to reimburse Halliburton subsidiary KBR nearly all of its disputed costs on a $2.41 billion no-bid contract to deliver fuel and repair equipment in Iraq, despite Pentagon auditors identifying over $250 million in charges as "potentially" excessive.

** Inspector-General Bowen told "60 Minutes" in February that there are nearly 50 ongoing investigations involving suspected "fraud, kickbacks, bribery, waste."

** Just one company (Custer Battles) has been suspended for its actions in Iraq and charged with fraud.

** The failure to apply responsible contracting standards has infected the entire federal contracting system. According to the Project on Government Oversight, four of the top 10 Federal contractors had at least two criminal convictions between 1990 and 2001, yet only one of the top 43 contractors was ever suspended or debarred - in that case for just five days.

** Average compensation for C.E.O.'s at 34 leading military contractors tripled from 2001 to 2004, to $3.9 million. C.E.O. pay packages were 23 times larger than the salaries of Army generals serving in the field, and 160 times the size of an average soldier's pay. (See IPS/UFE, "Executive Excess 2005: More Bucks for the Bang")

** David H. Brooks, CEO of bulletproof vest maker DHB Industries, earned $70 million in 2004, 13,349% more than his 2001 compensation of $525,000. In May 2005, the US Marines recalled more than 5,000 DHB armored vests after questions were raised about their effectiveness. (Timothy O'Brien, "All's Not Quiet on the Military Supply Front," NYTimes, January 22, 2006)

For More Information:

HalliburtonWatch.org
Washington, DC
http://www.halliburtonwatch.org

CorpWatch
Oakland, CA
http://www.warprofiteers.com
http://www.corpwatch.org

Project on Government Oversight
Washington, DC
http://www.pogo.org

Center for Public Integrity
Washington, DC
http://www.publicintegrity.org/wow/

Rep. Henry Waxman (D-CA)
House Government Reform - Minority Office
Special Investigations on Iraq Reconstruction
http://www.democrats.reform.house.gov/investigations.asp?Issue=Iraq+Reconstruction

The Arms Trade Resource Center, World Policy Institute
New York, NY
www.worldpolicy.org

Institute for Policy Studies
Washington, DC
http://www.ips-dc.org/iraq/quagmire/cow.pdf