Rebuilding in Iraq hampered by waste, corruption

Amy Scott Aug 2, 2006


MARK AUSTIN THOMAS: The war in Iraq is costing the US a lot of money. Now it seems some of that money is being wasted. A government watchdog says widespread corruption and a lack of coordination is hampering reconstruction in Iraq. A Special Inspector General for Iraq Reconstruction is set to testify today before a Senate committee. Marketplace’s Amy Scott has more.

AMY SCOTT: In a report today, Inspector General Stuart Bowen suggests that the cards were stacked against the reconstruction effort from the very start.

Security problems have made working in the country dangerous and often deadly. Corruption is rife. And Bowen says the contracting process was deeply flawed.

Douglas Holtz-Eakin, a fellow at the Council on Foreign Relations, says the new report is sobering.

DOUGLAS HOLTZ-EAKIN: We’re now past the point where we’re trying to physically reconstruct war damage and we’re trying to build a society there. This is a real blow to that effort.

Bowen is expected to offer some solutions, like creating a standard procedure for awarding contracts and a single agency to coordinate the process.

Addressing fraud may be more difficult. A recent survey showed one in three Iraqis have paid a bribe in the last year. An Iraqi official estimates the government loses $4 billion a year to corruption.

In New York, I’m Amy Scott for Marketplace.

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