Monday, July 25, 2011

U.S. wastes $34 billion in Afghan and Iraq contracting

From Reuters via the Huffington Post:

The United States has wasted some $34 billion on service contracts with the private sector in the wars in Iraq and Afghanistan, according to a study being finalized for Congress.

The findings by a bipartisan congressional commission were confirmed to Reuters by a person familiar with the draft of the study, which is due to be completed in coming weeks.


The report blames a lack of oversight by federal agencies for misuse of funds and warns of further waste when the programs are transferred to Iraqi or Afghan control as the United States withdraws its troops.

More here.

A couple of brief observations.

First, this is something of a supplement to my post from Thursday night highlighting Ralph Nader's assertion that if we really wanted to get serious about debt and deficit reduction, we could and should go after military expenditures for our useless wars in Afghanistan and Iraq, as well as for our constant readiness to fight the Soviet Union in WWIII--of course, because there is no Soviet Union, such preparation, like our Middle East wars, is useless, and therefore a massive waste of tax dollars. But this Reuters article isn't even about money actually used to fight or to prepare to fight: it's about money lost to simple mismanagement. That is, it's more money than you and a thousand of your friends could ever hope to earn in their lifetimes just lost, gone without rhyme or reason, because the US establishment loves to throw money at the military, and doesn't really give a shit if it does anything useful.

Why aren't we looking first to the most frivolously spending arm of the government, the Pentagon, when it comes to deficit reduction? Answer: the deficit hawks aren't really concerned with the deficit; they just want to cut social programs because they think all that money goes to black people.

Second, this news presents yet another real-world problem with the cherished economic notion that the private sector always does it better than the government. The reality is that often the government is absolutely the best way to go about accomplishing national goals, while private sector ventures often crash and burn. Remember that the vast majority of new businesses fail, and that's pretty much all you need to understand that the conventional wisdom regarding the private versus the public sector is not an honest discourse.