Congress Ignoring Report on Pentagon Spending

In April, the nonpartisan research arm of Congress issued a damning report that criticized the Pentagon for mismanaging hundreds of billions of dollars in emergency funds it received to pay for the occupation of Iraq and the war in Afghanistan.

Additionally, the report said, among other things, that since late 2003 the Pentagon has overstated its financial needs and has failed to turn over to Congress an accurate and transparent accounting of how it has spent the emergency funds earmarked for Iraq and Afghanistan.

The 45-page Congressional Research Service (CRS) report, "The Cost of Iraq, Afghanistan, and Other Global War on Terror," released in the Spring advised the new Democratic leadership in Congress it should withhold funding until the Department of Defense (DOD) provide lawmakers with a detailed accounting of its expenditures in Iraq, where 90 percent of the funds the Pentagon has received have been spent.

In July 2006, David Walker, comptroller general of the Government Accountability Office, testified before the Congressional Subcommittee on National Security, Emerging Threats and International Affairs. He told lawmakers that a lack of actual costs, supporting documentation and routine reporting problems by the Pentagon, with regard to the wars in Iraq and Afghanistan, "make it difficult to reliably know what the war is costing, to determine how appropriated funds are being spent, and to use historical data to predict future trends."

The DOD "has not been willing to provide Congress" with the data it uses to predict its operating costs on the ground in Iraq and Afghanistan, Walker said. As such, Congressional researchers have recommended in their report that Congress ask the DOD inspector general to audit the Pentagon in order to resolve these various gaps and discrepancies in cost data related to the occupation of Iraq and the war in Afghanistan.

Yet, despite issues raised by Walker and, more recently, in an updated report by the Congressional Research Service, the Pentagon has failed to open up its accounting books to Congress and the Democratic leadership in the House hasn't pressed DOD officials to do so. More than 90 percent of the DOD's funds for Iraq were provided in the form of emergency supplemental or additional appropriations requests. Emergency funding is exempt from ceilings applying to discretionary spending in Congress's annual budget resolutions. Some members of Congress have argued that continuing to fund ongoing operations with supplementals reduces Congressional oversight.

"Congressional leaders have promised more scrutiny of the administration's requests for a [fiscal year] 2007 supplemental and [fiscal year] 2008 war costs," the report says. "Thus far, Congress is receiving fairly detailed quarterly reporting on various metrics for success in Iraq ... but cost is not one of those metrics."

Financial documents that have been turned over by the Pentagon to Congress "have been sparse," and government agencies, including the Congressional Budget Office and the Government Accountability Office, "have all found various discrepancies in DOD figures - including understating budget authority and obligations, mismatches between [budget authority] and obligations data, double-counting of some obligations, questionable figures, and a lack of information about basic factors that affect costs such as troop strength ...," said a March CRS report on the cost of Iraq and Afghanistan military operations, and past issues associated with emergency spending requests.

"For example, DOD provided five pages to justify $33 billion in operation and maintenance spending, about half of the [fiscal year] 2006 supplemental request. Because few details are included, [the Congressional Budget Office] notes the difficulty in determining the basis of DOD requests and estimating alternatives," the CRS report says. "And because appropriations for war are mixed with DOD's baseline budget, information about 'what has actually been spent,' or outlays, is not available. That information is important for estimating the cost of alternate future scenarios and also for showing the effect of war costs on the federal deficit."

Furthermore, the DOD "has periodically revised the figures shown for each operation in previous years, suggesting questions about the validity of its figures," the report says, adding that some of the department's supplemental requests for 2007 included "$2 billion from some unknown source."

Moreover, the most recent CRS report related to the cost of Iraq and Afghanistan operations dated July 16, said that while the Pentagon has made slight improvements in "in showing how previously appropriated funds have been allocated among the three operations - Iraq, Afghanistan and other counter-terror operations and enhanced security - [the Pentagon's latest funding request] does not cover over $30 billion for classified programs and other funds for repair or replacement of war-worn equipment still to be obligated."

Late last month, Secretary of Defense Robert Gates told Congress that he needs $141.7 billion - roughly a 40 percent increase over the previous year - in addition to a $50 billion emergency supplemental President Bush requested in September to continue funding operations in Iraq and Afghanistan. If approved, it would bring the cost of the Iraq and Afghanistan operations to $610 billion. The $50 billion in emergency funding Bush asked for is needed, the DOD said, to pay for the 30,000 additional troops Bush sent to Iraq earlier this year. All told, the occupation of Iraq is costing taxpayers roughly $2.1 billion a week. The Congressional Budget Office predicted that by the end of 2008, the cost of the Iraq occupation could very well reach $1 trillion.

Democratic lawmakers and their aides were unwilling to comment publicly on whether they intended to force the Pentagon to be more transparent or if lawmakers heeded the advice of CRS and would call for an audit of the Pentagon. Privately, some aides to lawmakers serving on the House Appropriations Committee said that scenario was highly unlikely to happen.

David Obey (D-Wisconsin), the chairman of the House Appropriations Committee, said last month that he has "no intention" of passing an Iraq funding bill through his committee "that simply served to continue the status quo."

Senator Robert Byrd (D-Virginia), chairman of the Senate Appropriations Committee, became visibly upset last month when Gates disclosed how much additional funding was needed to continue occupying Iraq.

"If granted, we will have spent more than 600 billion! - billion! billion! - dollars" on the "nefarious and infernal war in Iraq," Byrd said.

Still, while statements like that of Obey's and Byrd's may allow Democrats to flex some political muscle from time to time it doesn't begin to address the Pentagon's accounting irregularities CRS says will continue to be a major factor each time the Bush administration seeks additional funding for Iraq and Afghanistan unless lawmakers rein in the Pentagon's spending and take a closer look at its books.

"Grappling with these issues is more difficult because DOD has provided limited information about prior war costs making trends difficult to decipher and explanations unlikely to be available," the July 16, CRS report said. The General Accounting Office, the Congressional Budget Office and CRS "have all raised concerns about these problems in reports and testimony. There are many unresolved discrepancies and gaps in reported DOD figures."

Gates testified before Congress last month that a large part of the funding request will be earmarked for equipment upgrades and weapons enhancement. But the CRS report said that still doesn't account for the massive annual increase in spending.

"Although some of the factors behind the rapid increase in DOD funding are known - the growing intensity of operations, additional force protection gear and equipment, substantial upgrades of equipment, converting units to modular configurations, and new funding to train and equip Iraqi security forces - these elements are not enough to explain the size of the increases," the report said.

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CRS estimates that war-related appropriations enacted to date total about $610 billion allocated as follows:
$450 billion for Iraq (or 74%);
$127 billion for Afghanistan (or 20%);
$28 billion for enhanced security (5%); and
$5 billion unallocated (1%).

Jason Leopold is senior editor and reporter for Truthout. He received a Project Censored award in 2007 for his story on Halliburton's work in Iran.

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