©This article copyright Sean-Paul Kelley
Since the war started we've been repeatedly told that we're building Iraqi schools, healthcare centers, and my personal favorite: turning the electricity back on. But what have we really gotten for our $18 billion?
Earlier this week Griff Witte wrote about the cancellation of Halliburton's big Iraq reconstruction contract. In that article he mentioned some health centers that were also contracted out which could lead people to believe they too were contracted out by Halliburton. He wrote that "a contract aimed at building 142 new health centers across Iraq instead produced 20 before the program ran out of money." He's right about a contract for 142 new health centers, but that's all he's right about. It wasn't Halliburton and they didn't even complete 20 centers.
"Halliburton wasn't the contractor," said James Mitchell, spokesman for the Special Inspector General for Iraq Reconstruction, this morning when I called him.
"It was a company called Parsons," he added, "in Pasadena and only 8 of the centers were completed."
The size of this boondoggle frankly astonished me. We have to be talking about big money, if it's a contract to build 142 new health centers, right? So, what caused it to run out of money? How much was originally alotted to the contract? How much was paid? I asked Mr. Mitchell all these questions.
Mitchell was a generous fount of knowledge on the subject. He pointed out that the original Parsons contract was for $243 million. I asked if all of the money had been given to Parsons. He wasn't sure, but pointed me to this document to find out. On page i of the executive summary it indicates that $186,000,000 of the original $243,000,000 was spent by Parsons "with little progress made."
I contacted the company and spoke to Amber Thompson, asking her to confirm how much money Parsons received from the government for this contract? She replied via email, "Your question is best referred to our customer, the U.S. government."
I followed that up in another email I asking: "Would Parsons depict the government's accounting [found in the executive summary] on this issue as correct or incorrect?" I haven't heard back yet. But I will let you know when I do.
I had asked Mr. Mitchell earlier, from the Inspector General's office, "where did all the money go then, if they only managed to complete 8 healthcare centers?"
"Was it because of security concerns? Did the Blackwater-types eat the money up?" I asked.
Mitchell said much of it was "administrative overhead." I'm not sure how Mitchell or the IG's office defines "administrative overhead." And I doubt Parsons would tell me if I asked.
"Let's back up and talk about security," I asked Mitchell. "What proportion does security make up in the Iraq reconstruction budget as a whole?" He said that, overall, after a series of quarterly and annual audits, his office estimates that 22% of the money spent on Iraqi reconstruction went to provide for the security of sites, personnel, supplies and movement of supplies and people. Twenty-two percent?
That's almost $4,000,000,000.
Now, math isn't my forte, but my trusty solar-powered Texas Instruments calculator can do the simple stuff like percentages rather well. If twenty-two percent of the original $186 million Parsons was contracted went towards security that means they paid $41 million for it. That leaves $145 million to build 142 health centers, of course that's less the 'administrative overhead'. The average amount of administrative costs for construction companies (see Yahoo! Finance) is about 10%, so Parsons would have been in the right taking $14.5 million for 'administrative expenses.' But let's be generous and make it 20 percent or $29 million, after all it is a war-zone, right? That leaves $116 million to build 8 health centers, or $14.5 million a center. The centers Parsons built, I bet, are the cream of Iraq's medical infrastructure, no doubt!Well, not exactly. The photos included with this post are what that $14.5 million a center got the good people of Kirkuk.
This is just one case, only 1.3% of the total $18 billion alottment to reconstruct Iraq.
And now Bush wants $110 billion more?
I could have spent $14.5 million to build a great community health center right here in San Antonio. Probably for cheaper.
Where did it all go? Because we know who's going to pay.
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Comments: 63
It is now clear that every single aspect of our policy in Iraq has been exposed as either a lie--WMD--or a fraud. This is just one example out of hundreds. I am working on many other stories, all about the billions that have been wasted in Iraq--and nothing has been reconstructed at all.
That is the story here. Not the good works of USAID. The only point in citing the good works of USAID is an attempt to deflect from the evidence right before your eyes, deflect so that people will argue about everything else except the reality that our policy in Iraq is an utter faiulure and fraud.
Just face it.
I did hear something about a lot of projects are to be stopped and re-bid. I didn't get a chance to see the news about it though, or read either.
Neat that you called all those guys. Sick 'em!
Looks very typical of Halliburton and their subsidiaries. I am sure Saddam would have built better health care centers that us.
Thanks for posting the article Sean.
It seems the real reason we invaded Iraq was to fatten up the coffers of the public corporations and privately held companies run by and benifiting the wingnuts themselves who run companies that were given appropriation-Xmas-gift-funds like Halliburton, Kellogg Brown & Root (KBR) which is a Halliburton subsidriary, Rendon Group, Bechtel, Global Options, Aegis Defense Services, BearingPoint, Inc., BKSH & Assoc, Custer Battles, Lockheed martin, Loral Satellite, etc.
Dick Cheney came to the VP office directly from the helm of Halliburton, he had millions in stock options and bonuses. The stock options are still his, they have only been put in a blind trust until he was done being VP. Cheney still gets to reap the rewards he so richly rewarded Halliburton with in no-bid Iraq contracts once he steps out of office.
And who want to lay odds w me that he will again be working for them (unless his heart gives out first - but maybe this is proof he doesn't have one lol).
By doing this BushCo has bankrupted the US' "War on Terror" and is on the way to bankrupting the entire country by this disgusting corporate welfare program and their incredibely stupid and short-sighted lack of attention to our budget and the National Deficit by borrowing money to pay down debt. We now have a 3.5+ Billion budget deficit - when Clinton left office he had paid down our countries debt so we had a budget surplus. The budget deficit, BTW, was run up by the 12 preceding years of 2 previous wingnut admins (8 yrs of Reagen and "supply-side voodoo economics" and the following 4 years of BushCo1).
Excuse me while I go barf!
Don't get me wrong - I do think fun and frivolity is good, and I'm guilty of it myself. It just seems that people on Gather spend a lot of time complaining a lot about the "lack of quality" on Gather, while ignoring some of the really good writing and journalism that's already here.
Keep up the good work...this is better stuff than much of what I find in the mainstream newspapers.
Thanks for the low down. I wonder if Parsons is a company that formed just to do this work in Iraq.
How can I find that out?
I really recommend everyone take a good look at the photos.
But at what incompetence, and at what cost and at what accountability should the burden be for the US. Or why just give away money and hope it'll all work out ok in the end.
Good article Sean-Paul
I dunno, Richard, in looking at those photos, it doesn't look like the US is managing this well at all...
And it's not like we've figured out how to have good healthcare in our own country, so it's ironic that we'd be trying to get some going in another...
May I suggest letters to your congresspersons as well as comments on Gather?
Just so you know, "Parsons" is Ralph M Parsons, an engineering & construction firm that's been around for decades. It's not a big firm, but it's not a sham.
Just the outcome of the parisan divide it seems, must not be disloyal to the Good Ole Party(team).
And it's not like we've figured out how to have good healthcare in our own country, so it's ironic that we'd be trying to get some going in another... '
That why I say three generations of leaders in Iraq are needed before we even think of leaving. 80 more years are necessary.
However, that doesn't mean that who the US lets contracts out to can't or shouldn't be held accountable to the American people for managing those contracts.
The US has the best Health Care in the world as well as the best legal system in the world.
only problem 45 million folk in the US can't get either.
only problem 45 million folk in the US can't get either."
The blind leading the blind...
And I shouldn't have made the statement that the US Health Care isn't available to 45 million, as it is available to all.
Every Emergency Room in every hospital is required by law to accept everyone that comes into it, and to give the necessary care to them. That care may or may not be paid for by the person. And as all hospitals are required by law to give so much charity care the health care may be paid for or may just be written off as charity.
The rankings of every hospital that is accredited in the US (which is almost all of them) is also ranked for how good they are for every known disease by the Joint Commission on Accreditation of Healthcare Organizations or www.jointcomission.org for short. Every library in the US has computers that are available to all and anyone can lookup on the jointcomission site and see how good or bad any hospital is in the US at giving care for any disease. Therefore there is also feedback to all so anyone can also see ranking for the hospital they plan to go to.
And the US can set that system up in Iraq also, as it's only a matter of cost.
This is actually becoming a huge problem, because people who don't have health insurance (of which there are many) are running to the ER for every little sniffle, causing a huge burden on the ERs in the country, not just financially, but also in terms of their ability to provide proper care to incoming patients.
Many ERs in the US are shutting down because of this.
This seems like a crappy system to duplicate over there.
No Sh it sherlock as the saying goes.
That's why in another place and at another time I said that everyone in this country needs to buy their own Health Care insurance, and those that can't afford it need to get help from the state. And when the Employee Benefits are cut that must go to the employee, and there needs to be an Income Tax break in in paying for the Health Care Insurance.
But I won't discuss that issue any more in this thread.
Any time the government is writing big checks, this kind of waste and mismanagement occurs. Its not new, and it is not unique to Iraq.
I agree with Steph and KEO that this is front page material.
Thank you so much for researching this and following up on it.
I may be talking out my butt on this one, but I seem to remember something about Parsons being affiliated with Bechtel in the great Boston Big Dig disaster, which has come in at about three times its estimated cost and where a woman recently died when a concrete ceiling fell on her car when she was driving to the airport.
Do you know anything about that? I just seem to remember hearing Parsons/Bechtel being bandied around, but I could be wrong.
First, let me say I think you're article is first-rate. The "Where did the money go?" question has been asked before about operations in Iraq. A few years ago, when the current administration was brushing off all questions asked as being "un-American", those who were asking where the "lost billions" went stopped asking when they realized that the voting public didn't seem to care where the money went.
In a nuts and bolts sense, it would actually be better for us, as a nation, if the money was stolen rather than it being a case of the administration having no idea of what is really going on over there. But, it has to be one or the other, there are no other logical explanations.
It is either:
A. the money has been stolen .
or
B. the administration has no idea of how to keep track of the money, and therefore cannot keep contractors honest.
I don't think you will find one single war that America has ever been involved in where it didn't matter if money being spent in relationship to that war was not required to be accounted for.
As a voting American citizen I want to see every politican or contractor who stole money from my government sent to jail.
Show me a political candidate who promises to go after any crooks found in the hen house, and I'll consider voting for them no matter what party they are from.
Paul Bremer was put in charge of the $18 BILLION in funds that were initially allocated for reconstruction. By the time he left, so had $8.8 BILLION. Poof. Gone. Just like "that." No trace, no investigation, no discussion, nothing. Just half of the funds, nearly $9 billion US taxpayer dollars, gone. And, what became of Mr. Bremer for his gallant efforts? He was awarded a "Medal of Freedom" by our illustrious national CEO.
This nation needs congressional oversight so badly, it hurts. These corrupt republicans and their corrupt war profiteer pals are destroying us.
Iraq is a perfect example of what happens when you let unbridled capitalism rule the land. Iraq is the republican Utopia, in terms of how it's being run. Everything has been privatized, nothing works, and we're witnessing fraud and corruption on a scale that the world has simply never seen before.
I think we should all be careful not to assume that all of this is an accident. Chaos was created intentionally, for the sole purpose of looting the US national treasury.
There's a reason why Bush left all of those weapons caches with hundreds of tons of high explosives unguarded.
There's a reason why he allowed the infrastructure in Iraq to be destroyed.
There's a reason why he allowed rampant, uncontrolled looting.
There's a reason why they allowed unemployed in parts of Iraq to reach 90%.
There's a reason why they allowed and encouraged a strong insurgency uprising.
It's much easier for war profiteers to steal when they're working amidst sheer chaos.
Btw, Halliburton is currently building massive detention centers in the US. That outta give you shivers and sleepless nights.
And join Clark Kent in the shivers and sleepless nights over thisBtw, Halliburton is currently building massive detention centers in the US. That outta give you shivers and sleepless nights.
I was not aware of this. Can you elaborate?
Thanks for the article. Can we do anything to stop this corporate control of our government which is driving us to
ruin. Our grandchildren will be the ones left paying half their income in taxes.
By 2008 this war will cost us 500,000,000,000 half a trillion dollars. I agree the terrist need to be stop! But how do we do that?
I sure hope this ordeal doesn't lead to big economic problems for future generations. It seems like American money is becoming worth less and less...
the "global village" (of which we have set ourselves up as King) has been established, we receive NOTHING from
the rest of the world and think we're able to "whip" any
enemy and save the world.
We have signed onto NAFTA, GATT, CAFTA, and now a
trade agreement with Oman -- which will give them FREE
access to our ports for all their goods, while 87 percent
of ours will be free to them -- the other 12 percent will
be phased into the agreement over the next 10 years --
more or less. (I forget the exact number of years in the
Sunday Tribune-Democrat (Johnstown, PA) in the report
of the passed legislation.)
Now the next two years, the Republicans and Democrats
will vie for the hearts of their constituents by PROPOSING
all types of legislation, making it appear that they're going
to take care of OUR NEEDS. However, I'm not optomistic
that anything of substance will become law to benefit US.
The illegal immigrants can expect to become citizens and
get a reprieve of everything but maybe $1,000 contribution to the Treasury. . . . . all before 2008. Welcome to Los Estados Unidas.
Additionally WRT Paul Bremer and the CPA. There was an executive order preventing audits and all of them have been given unconditional immunity. Sad really sad.
As to the Parsons-Bechtel connection, there are four or five major (multi-national) engineering/construction companies out there, including Parsons, Bechtel, Parsons-Brinckerhoff (not the same 'Parsons') and others, depending upon who has acquired whom. While Parsons and Bechtel are separate entities, these major players often team up to share the risks and/or share the spoils.
Rest assured that the Corporate Boards at these companies never lose a moment's sleep over the kinds of activities depicted in this article.