REVIEW OF IRAQ RECONSTRUCTION
THURSDAY, JUNE 8, 2006
House of Representatives,
Committee on International Relations,
Washington, DC.
The Committee met, pursuant to notice, at 10:10 a.m. in room
2172, Rayburn House Office Building, Hon. Henry J. Hyde (Chair-
man of the Committee) presiding.
Chairman Hyde. The Committee will come to order. Last night
at 6:15 p.m. justice was delivered to Abu Musab al-Zarqawi, Iraq's
most wanted terrorist. Although many challenges remain in Iraq,
his death seriously undermines the mission of al-Qaeda.
As President Bush said this morning, Zarqawi's death has the
potential to "turn the tide in Iraq." His death is a victory in the
Global War on Terror, and today we remember the innocent lives
taken by Zarqawi and his terrorist network.
There is no doubt that the United States, with the cooperation
of our allies, has engaged in dialogue and meaningful reconstruc-
tive efforts with the Iraqi people to help build a foundation for es-
tablishing a secure and sovereign Iraq.
The recent formation of the Iraqi Government by Prime Minister
Nouri al-Maliki is a step in the right direction. The Iraqi people
should be commended for their unforgettable sacrifices and commit-
ment to rebuilding a nation from the ashes of tyranny, war, and
sectarian strife.
The American people also have contributed to this process
through their military and financial support to the fledgling Iraqi
Government. Since the fall of Saddam Hussein, the American peo-
ple have provided approximately $29 billion in United States as-
sistance to Iraq for reconstruction programs.
Through USAID and other United States agencies operating in
Iraq, the American people continue to assist in restoring important
sectors of Iraq's government and economy. These reconstruction
projects are an integral part of the President's strategy to build a
democratic, stable and prosperous country.
However, significant challenges to stabilize Iraq have resulted in
important lessons learned that this Administration is internalizing
and responding to. Nobody denies that mistakes were made. What
is important is how the United States adjusts its strategy to serve
the interests of the American people and to support the new Iraqi
Government in implementing its agenda to bring security and sta-
bility to the Iraqi people. In other words, have we learned from our
mistakes, and what are the lessons learned?
(l)


7
have made or the moral basis of which we have decided to try to
ensure that the people of the Muslim world have alternatives to
this type of Islamo-fascism represented by Zarqawi.
Chairman Hyde. The gentleman's time has expired.
Mr. Delahunt of Massachusetts?
Mr. Delahunt. Thank you, Mr. Chairman. In your opening re-
marks you mentioned that aggressive oversight works. You were
referring to the Special Inspector General for Iraq. I commend him
for his obvious diligence and outstanding work.
Unfortunately, this Committee and this Congress have not con-
ducted aggressive oversight. I serve on the Subcommittee that is
entitled Oversight and Investigations. It is chaired by my friend
and colleague from California who just spoke, Mr. Rohrabacher. It
was interesting that he used the phrase that this "opens the dis-
cussion." After how many years are we beginning to discuss the re-
construction phase in Iraq?
I associate myself with the remarks of Mr. Lantos. I think they
summed up the case. He referred to multiple examples of egregious
fraud, abuse and mismanagement.
I would note that Mr. Bowen assumed his office in January 2004.
I would suggest that that was late. That was very late, Mr. Chair-
man. Tragically, it has cost the American people billions of dollars
in taxpayer dollars, as well as putting forth a perception, albeit un-
fair, that we didn't care. We made statements that didn't match
the realities.
You know, the issue of contracting in Iraq could be the biggest
corruption scandal in history, according to Transparency Inter-
national. As a former prosecutor, my instincts tell me that that
statement, given time and given hindsight of history, will prove to
be accurate.
We have missed the boat. We have not exercised our responsi-
bility as Congress. We have turned our back on our constitutional
duty. I do hope, Mr. Chairman, that you authorize the Sub-
committee on Oversight and Investigation into conducting a series
of exhaustive and thorough investigations so that we may learn
more about the mistakes so we don't make them again in the fu-
ture.
Chairman Hyde. The gentleman's time has expired.
Mr. Paul of Texas?
Mr. Paul. Thank you, Mr. Chairman. I too would like to asso-
ciate myself with the comments made about the waste and the
fraud and the corruption in the reconstruction in Iraq.
Obviously it is there, but I am not very optimistic that it is going
to get cleaned up because I think it is the nature of government
largesse that you always have waste and corruption, especially
under the conditions that exist on wartime and that exists in Iraq.
I think we ought to understand that that is the nature of things,
and tragically I don't see it coming to an end.
I would much rather see some interest in stopping the destruc-
tion rather than the pretense that we can reconstruct Iraq. We
have already spent about $300 billion over there, and most of it has
ended up in destruction of property. The taxpayers really get it.
They get hit. They get hit. They pay for the destruction. Now ev-


9
bid contracts, the awarding of no-bid contracts and the well-con-
nected defense contractors that billions of dollars have been lost. I
remember $9 or $10 billion. We still can't figure out where that
went.
The lack of accountability and oversight, I think that has to be
reconciled. I am curious, and when we get into your testimony I
hope you address what processes and mechanisms are in place to
make sure that there from this day forward is some accountability,
but also what happened to that $10 billion, if you found it yet. I
think that we failed in our constitutional obligation to really pro-
tect the taxpayers in this process.
Finally let me just say yes, I agree with Mr. Paul. I think what
I see taking place now is the final realization of the fact that we
want a permanent presence of Iraq. This House passed, the Senate
passed a resolution saying we did not want to authorize permanent
military bases in Iraq. The American people don't want permanent
bases there. The Iraqis don't, yet it is my understanding that now
in the Conference Committee that for whatever reason that resolu-
tion or that amendment was taken out of the supplemental.
That makes no sense, so I am curious to find out from you all
if you believe that part of what we are doing in Iraq will lead to
a permanent presence with establishment of permanent military
bases, or if in fact that is not the case I hope you say that.
Thank you, Mr. Chairman, and I yield the balance of my time.
Chairman Hyde. Mr. Poe of Texas?
Mr. Poe. Thank you, Mr. Chairman. Thank you for your leader-
ship in the House of Representatives. You are a great role model
for all of us, and I appreciate your chairmanship of this very impor-
tant Committee.
I had the opportunity to view the first free elections in Iraq on
January 30, 2005, along with Congressman Chris Shays, and I
learned that the Iraqis, like the American people, love freedom.
They have tasted it, and they are not going to let it go even though
it costs lives of Americans and Iraqis. Our troops, by far, are the
finest in the history of the military, and their voluntary service is
unparalleled in world history.
Like the success of the Marshall Plan at the end of World War
II, rebuilding of Iraq needs to be successful as well. However, as
a former judge in Texas I am concerned about alleged corruption
in the rebuilding efforts. Those that prey on the misfortunes of war
and those that make unlawful profits by war, those that have sto-
len in Iraq, those that are the thieves of Baghdad are war crimi-
nals, and their corruption must be brought to justice.
This country and the Iraqi Government must insist that justice
rules the day, and we owe this to the American people and all free-
dom loving people in the world.
With that I yield back, Mr Chairman.
Chairman HYDE. Thank you, Judge.
Mr. Schiff of California?
Mr. Schiff. Thank you, Mr. Chairman. I want to thank you and
the Ranking Member for having this hearing today. At the outset,
I wanted to express my congratulations to the American troops and
to the Iraqi people who successfully led us to Zarqawi and killed
a murderous scum that no one will mourn the loss of.


13
in this reconstruction, including the $8.8 that has been talked
about earlier today, how we are going to find out what happened
to that and what kind of investigation we are going to have on
that.
We need to have the same robust investigation on U.S. tax-
payers' dollars as we did on the World for Food program.
Thank you, Mr. Chair.
Chairman Hyde. Thank you.
Mr. Flake of Arizona? Mr. Flake passes.
Mr. Carnahan. Thank you, Mr. Chairman and Ranking Member
Lantos, for this vital hearing on reconstruction in Iraq.
I think it goes without saying that this Congress has not exer-
cised sufficient oversight over reconstruction. It is our responsi-
bility and duty to provide serious and meaningful oversight over
the Administration's efforts to rebuild Iraq.
I had the opportunity to travel to Iraq in March 2005. In the
year since, the progress has been too little and too slow. The bil-
lions of dollars have been wasted without questioning the Adminis-
tration at a time when our country spends less than $2 billion a
year on alternative energy research, while spending $7 billion a
month in Iraq, is grossly irresponsible for this Administration to be
wasting any money, let alone the billions it has in Iraq.
In addition to the immense cost of reconstruction, one of my
main concerns is where we are in terms of Iraqi self-governance.
Moreover, the basic infrastructure construction that they need is
quite insufficient, and I question whether the Administration has
a clear plan to complete this essential project.
I am also interested in looking at the model and learning from
the model of the Truman Commission during World War II. Tru-
man took this on as his patriotic duty in a way that was pro troop
and pro taxpayer, and it was one of the most bipartisan Commit-
tees in this Congress.
I hope we can learn from that model and this Congress can join
behind these efforts in a bipartisan way in a pro troop, pro tax-
payer way to really turn this around.
Thank you, Mr. Chairman.
Chairman Hyde. Mr. Tancredo of Colorado? Mr. Tancredo
waives.
Has everyone who wishes to make an opening statement fulfilled
their urge? Good.
I would like to welcome Ambassador James Jeffrey. On August
10, 2005, Secretary of State Rice appointed Ambassador Jeffrey as
Senior Advisor to the Secretary and Coordinator for Iraq. Ambas-
sador Jeffrey is a career member of the U.S. Foreign Service, pre-
viously serving as Deputy Chief of Mission in Baghdad from June
2004 to March 2005.
Mr. Stuart Bowen is Special Inspector General for Iraq Recon-
struction. He previously served as the Inspector General for the Co-
alition Provisional Authority. Mr. Bowen has served President
George W. Bush as Deputy Assistant to the President and Deputy
Staff Secretary and Special Assistant to the President and Asso-
ciate Counsel.
Mr. James Kunder is Assistant Administrator of the Bureau of
Asia and the Near East at the U.S. Agency for International Devel-


19
With that, I thank you for this opportunity to deliver brief re-
marks and look forward to answering your questions. Thank you,
Mr. Chairman.
[The prepared statement of Mr. Bowen follows:]
Prepared Statement of Mr. Stuart W. Bowen, Jr., Special Inspector General
for Iraq Reconstruction
introduction
Mr. Chairman, Ranking Member Lantos, and members of the Committee—thank
you for the opportunity to address you today on important matters regarding the
United States' role in the reconstruction of Iraq. The Congress has tasked my office,
the Special Inspector General for Iraq Reconstruction (SIGIR), to provide oversight
of this substantial and challenging endeavor. I am here today to provide you with
the most current reporting on SIGIR's oversight efforts in Iraq. I hope for a produc-
tive exchange of views and ideas in this hearing regarding Iraq reconstruction.
A few days after submitting our April 30, 2006 Quarterly Report to Congress, I
returned to Iraq for my 12th tour, to work in Baghdad and across Iraq with SIGIR's
50 staff members currently stationed in Baghdad. I also had numerous meetings
with those managing the operational and contracting components of the US recon-
struction effort in Iraq. I returned from Iraq a week ago and I am pleased to provide
you my observations garnered from my recent weeks of work in Iraq. I also want
to update you on the critical issues raised in SIGIR's April 30, 2006 Quarterly Re-
port to Congress.
As SIGIR noted in its January 2006 Quarterly Report, this is the Year of Transi-
tion in Iraq reconstruction. By the end of 2006, most programs and projects funded
by the IRRF will be turned over to Iraqi authorities. With that prospect on the hori-
zon, reconstruction planning and operations are increasingly becoming a joint enter-
prise, with U.S. and Iraqi officials coordinating more and more on the planning of
key reconstruction initiatives.
With approximately 67% of the $18.4 billion in Iraq Relief and Reconstruction
Funds (IRRF) now expended and just under $2 billion left to obligate, the U.S. re-
construction program in Iraq is fully engaged in project execution and sustainment,
contract close-out, and program transition. Effectively advancing the progress of re-
construction and development in Iraq at this critical juncture requires the U.S. gov-
ernment to work closely with the Iraqi government and international donors to sus-
tain the substantial U.S. investment in Iraq's infrastructure.
In its April 2006 Quarterly Report, SIGIR identified five critical issues con-
fronting the reconstruction program at this watershed moment in the Iraq endeavor:
• Improve Infrastructure Security: critical nodes must be protected
• Close the Reconstruction Gap: fund the Secretary of State's initiative to build
capacity at the local level
• Energize the Oil and Gas Industry: 94% of Iraq's national income is derived
from this industry but only 9% of the IRRF was spent on it
• Fight Corruption: Iraq continues to lose capital to widespread corrupt prac-
tices
• Engage the Donor Community: the reconstruction program must be
multilateralized
Improve Infrastructure Security—SIGIR continues to review the critical issue of
infrastructure security. Insurgent activity impedes ongoing reconstruction projects
and interrupts the transition of these projects to Iraqi control. Attacks on Iraq's oil
and gas and electrical infrastructures have limited progress in the past within these
key sectors. Early U.S. efforts to address this issue did not succeed as SIGIR audi-
tors discovered in a review of a $147 million program called Task Force Shield,
which was established in September 2003 to build Iraq's capacity to protect its oil
and gas and electrical infrastructure. Task Force Shield sought to cover 340 key in-
stallations, 7,000 kilometers of oil pipeline, and 14,000 kilometers of electrical trans-
mission lines. The audit found that the program failed to meet its goals.
SIGIR is now executing a significant current review of this issue and will provide
a classified report on it during this quarter. I addressed the infrastructure security
issue with U.S. leadership in Baghdad during my recent trip to Iraq. Recognizing
its importance, the U.S. Ambassador to Iraq has made infrastructure security an
essential element of the Embassy Joint Blueprint for Success. Of note, significant
progress has been made on infrastructure security over the past quarter. For exam-


30
Electricity officials to monitor and control the electrical grid from three central loca-
tions, greatly improving the reliability of electric power service to Iraqis.
USAID has refurbished or expanded 19 water treatment plants in five cities in
Iraq increasing the supply of potable water from USAID projects to over 2.3 million
Iraqis. USAID has also provided sewage treatment to over 5.1 million people. We
have also been providing plant-level operations and maintenance support at major
potable water and sewage treatment plants nationwide to ensure that these plants
continue to function. In addition, USAID's rural water program is installing over 70
small water treatment systems in rural communities of less than 5,000 people
throughout Iraq. The rural water program will help to supply clean water to almost
500,000 villagers each day.
Fifth, USAID is helping to build a long-term sustainable economy through our ag-
ricultural assistance programs. USAID's Agriculture Reconstruction and Develop-
ment Program for Iraq (ARDI) is generating real jobs that sustain livelihoods—up
to 28,000 jobs per day according to employment records in 2006. The program is
managed by a small core of expatriate technical advisers and a larger team of 250-
300 Iraqis through five offices across the country with less than 8 percent of project
funds going towards security.
Thanks to canal and water infrastructure improvements made possible by small-
scale grants, 445,000 Iraqi farmers now have improved efficiency of irrigation or ac-
cess to water on 320,000 acres of farmland. ARDI has also established date palm
nurseries in 13 governorates that will expand the true to type palm tree population
by 410,000 new trees a year. Throughout the country ARDI planted 9,000 olive trees
in 16 demonstration plots, which will produce high value oil.
Sixth, USAID is focused on providing a better future for Iraq and is investing in
this future by focusing on the country's children and youth. A demographic youth
bulge threatens Iraq's future. In 2004, half of all Iraqis were under the age of 20
years old. Given current population growth rates, the population will double by
2030. Despite vast oil reservoirs, Iraq currently has some of the lowest literacy rates
and poorest health statistics in the region. USAID's education and health projects
have partnered with the United Nations (UN) to improve education and health care
for future generations through improving the quality of teaching and the learning
environment for schoolchildren and improving the capacity of the Ministry of Health
to provide quality essential services nationwide, including vaccinations against in-
fectious diseases such as measles, mumps, rubella, and polio.
PROVINCIAL RECONSTRUCTION TEAMS (PRTS)
USAID is working cooperatively with other USG and Iraqi agencies in the current
combined effort to expand Provincial Reconstruction Teams (PRTs). PRTs add value
to the USG effort by building productive relationships between provincial and na-
tional government institutions; establishing lines of communication and cooperation
between the civilian and military components of the PRTs; devolving USG authority
to an interagency group outside of the host country's capital city; and linking exter-
nal donor assistance to sub-national government structures and populations.
To date, four PRTs have been inaugurated in Iraq (Nineva, Tamim, Babil, and
Baghdad) with four others having been stood up (Anbar, Salah ad Din, Dhi Qar,
and Basrah) but have yet to be inaugurated. USAID has identified seasoned devel-
opment professionals to serve as the USAID representative to each of the current
and future PRTs, a procedure that will be replicated for each future US-led PRT
opened in Iraq. This individual works to ensure the appropriate linkage of PRT ac-
tivities with USAID programs, in particular its local governance program, as well
as citizen participation for greater transparency and accountability and improved
services delivery.
Additionally, the USG is working to engage other coalition partners in the PRTs.
The USG, in coordination with these coalition partners, is currently setting up sev-
eral additional PRTs. USAID is an active participant in this process and is staffing
the necessary positions as they are made available and needed.
OUR COMMITMENT TO ACCOUNTABILITY
USAID has been, and continues to be, committed to ensuring that the resources
that Congress has provided are managed effectively and transparently. Ensuring
that these funds are utilized in such a manner only strengthens their impact on
Iraq and improves the chances for success in Iraq. Accountability for Iraq funds is
fortified by the right mix of experience and teamwork between our field mission in
Baghdad and office in Washington. Experienced controllers, contracting officers, and
Inspector General staff have been in Iraq since 2003 working with technical staff
to help ensure program accountability.


33
general statements. In the light of obscene oil profits running into
tens of billions of dollars with the explosion of petroleum prices,
have these countries met their initial obligations, let alone addi-
tional commitments, to participate in the reconstruction of Iraq?
Mr. Jeffrey?
Mr. Jeffrey. No, sir, they have not.
Mr. LANTOS. What efforts has the State Department made to en-
sure that these rich Arab countries which are now benefitting from
windfall profits of obscene proportions, with gasoline in my State
of California approaching $4 a gallon, that they meet at least the
puny initial commitments they have made to reconstructing Iraq?
By the way, our Ambassador to Saudi Arabia was in my office
a few days ago, and he was stunned when I asked him what are
you doing to see to it that Saudi Arabia participates in this effort,
in the effort to help the people of Darfur. This was a brand new
idea for him.
I was so appalled by his lack of understanding of the issues an
American Ambassador needs to deal with. What are our Ambas-
sadors instructed to do in the oil rich Arab countries to see to it
that they live up to their commitments and obligations?
Mr. JEFFREY. Sir, let me answer that. We have very significant
pledges. They are very large even by the standards of these coun-
tries. Saudi Arabia, for example, half a billion dollars in
Mr. LANTOS. Well, what is the value of their windfall profit just
in the past year?
Mr. Jeffrey. It is in the tens of billions of dollars.
Mr. LANTOS. It is in the tens of billions, so half a billion dollars
is not that impressive, but be that as it may.
Mr. Jeffrey. And another half a billion dollars in loans. In addi-
tion, other countries—Kuwait, half a billion. Kuwait has disbursed
some of its monies, I am happy to say. UAE, $200 million.
In addition, these countries collectively, particularly Saudi Ara-
bia, hold between $30 and $40 billion in Iraqi debt. We are urging
them to follow the lead of the Paris Club and to forgive 80 to 100
percent of that debt.
In terms of what we have done, and, Mr. Lantos, I am always
concerned about giving you inputs because what you are interested
in is outputs, and I have basically said that there have been little
outputs up until now, and I will try to explain perhaps why, but
in terms of inputs by the Administration there have been a great
many.
I traveled for 10 days through the region in October. This was
followed up by the Secretary, who met with the GCC Foreign Min-
isters in November in Bahrain. The President communicated with
the leaders of these countries on this very subject. All of this was
directed toward supporting the new Iraq.
Mr. Zeloko, the Consulate, was out, as were Treasury officials, in
January, and we are also, as I mentioned in my written comments,
looking at the possibility of an international compact with the UN
and other international organizations participating with us, the
Iraqis and countries in the region to get them to move forward.
Now, you are absolutely right that they understand, and they do,
that reconstruction in Iraq and stability in Iraq is absolutely crit-


38
Mr. Bowen. No. No. That is on top of the Iraq Relief and Recon-
struction Fund. It is not part of the IRRF allocation. That was a
military allocation.
Mr. ACKERMAN. What percentage of the money for reconstruction
has gone into no-bid contracts?
Mr. Bowen. A very small percentage. The time for no-bid con-
tracting or limited contracting occurred prior to the war or in the
spring and the summer of 2003. Since then over 90 percent—prob-
ably 99 percent—of the contracting has been competitive.
Mr. Ackerman. How many contractors in dollar amounts? How
many contractors have folded, gone bankrupt, left town, were not
able to complete their projects, had to be replaced or couldn't do the
job?
Mr. Bowen. I don't know any that have gone bankrupt or had
to fold because of financial difficulty. There have been contractors
that have failed to complete their job, most notably Parsons in the
primary healthcare clinic contract which has been detailed in this
latest report by SIGIR.
Mr. Ackerman. I will yield back my time if I have any and wait
until later.
Chairman Hyde. Thanks.
Ms. Ros-Lehtinen?
Ms. Ros-Lehtinen. Thank you, Mr. Chairman. I thank the pan-
elists for their testimony.
I wanted to ask about the funding and the training for the Iraqi
police. Can you elaborate on the training that the Iraqi police are
receiving? How much are we spending on this training, and will we
oppose the inclusion in the security forces of anyone actively in-
volved in militias or other armed groups outside of the state's mo-
nopoly on force? What criteria have been established for the re-
cruitment of Iraqi police and security personnel?
Also, when providing training and technical assistance to the
Iraqi police force or other official security organizations, what safe-
guards are in place to ensure that the materials and the knowledge
provided to them are not disseminated to Islamic jihadists or to
militant organizations that are openly engaged in criminal activi-
ties or sectarian violence?
Thank you.
Mr. Jeffrey. Certainly. I will take that. Congresswoman, of the
approximately $10 billion of U.S. funds inside of the IRRF program
and in the DoD supplemental in 2005 that have gone to security
forces, a little less than 50 percent have gone to the police. These
include major programs by our State Department Bureau of Inter-
national Narcotics and Law Enforcement to train the police.
They have a police academy in Jordan. They have various police
academies around Iraq to give people a roughly 8-week training
program. The Jordanian one has a large number of trainers from
many other countries as well, we are happy to say.
In addition, we do a great deal of specialized training of police
and forensics and special weapons and tactics and this kind of
thing, so a great deal of the effort in our security field has gone
into the police.
In terms of the training, the training includes a great deal of
classic police work, some human rights training, but frankly a


40
that money so that some assessment could be made of how that
money was used. It was a chaotic environment, and therefore more,
not fewer, controls were necessary in SIGIR's view.
A private accounting firm did some looking into how that money
was used on the Iraqi side of the ledger, and it was
Mr. SCHIFF. But again, Mr. Bowen
Mr. BOWEN. Yes?
Mr. Schiff [continuing]. My question is about accountability.
Mr. Bowen. Yes. I guess the abuse of that money or the fraudu-
lent disposition of it involved Iraqis over which the Commission on
Public Integrity has charge.
We have been supporting them in their efforts. They have 960
cases ongoing regarding fraud within the Iraqi Government and
convicted a senior director general last week of fraud.
Mr. Schiff. So is your response then that the people that have
been held accountable for the massive lapses in terms of billions of
dollars and the reconstruction efforts that have begun, but not fin-
ished, are Iraqis; that we have held no one accountable who was
actually responsible for the trust of those funds or the management
of those funds or the oversight?
I thought the CPA was running the show. I thought we were
running the reconstruction effort and working with Iraqis, but no
one other than the Iraqis and a handful of small grafters compared
to the billions that are missing have been held accountable?
Mr. Bowen. We have jurisdiction over prosecuting Americans
who commit crimes in Iraq.
Mr. Schiff. I am not talking about necessarily prosecutable
criminal offenses. I am talking about we have invested tens of bil-
lions of dollars in Iraq reconstruction. We have very little to show
for it.
We have very little accounting of even how big chunks of money
have been spent in terms of the Iraqi oil funds. That is our respon-
sibility. I don't see anyone who has been held accountable for that.
Mr. BOWEN. Well, we are in the midst of a significant lessons
learned program that is looking at how the program during CPA
unfolded and thereafter.
Mr. Schiff. Can I make one point because my time is running
out?
Mr. Bowen. Yes.
Mr. Schiff. I think one of the lessons learned here may not be
enumerated in your report, but it is true with respect to the recon-
struction. It is true with respect to the prosecution of the war ef-
fort. Where there has been inadequate oversight and where there
has been a lack of accountability there is a commensurate decline
in public confidence in the entire effort.
When people don't see the oversight and they don't see the ac-
countability, they seriously question whether we know what we are
doing. That, I think, is an important lesson learned.
I really hope that this is not a hearing, just a shot in the dark.
I hope it is a part of a continuing process because this body and
the Administration have the responsibility for the oversight and
the accountability.
Let me ask you one other—well, I am out of time.
Chairman Hyde. Go ahead.


41
Mr. Schiff. The last question I wanted to ask is there have been
reports, Mr. Bowen, that the Pentagon has been unhappy with
your reports; that they consider you mettlesome.
Are you getting any push back? Are you rinding any resistance
at the Pentagon to the work you are doing that we need to know
about because we support the work you do, and we don't want
there to be any impediment.
Mr. Bowen. No. No, I haven't. When I met with Secretary Eng-
land, the Deputy Secretary of Defense, a month ago I raised this
issue with him because of those anonymous reports in the press.
He disassociated himself with those entirely and said that he com-
pletely supported SIGIR's efforts, and the Secretary of Defense did
as well.
Mr. Schiff. Thank you, Mr. Chairman.
Chairman Hyde. Mr. Rohrabacher?
Mr. Rohrabacher. Yes. I would like to commend Mr. Schiff be-
fore he leaves the room, that is, number one for the tone of his
opening statement, as well as the tone and substance of his session
just a few months ago and his approach to the questioning. I be-
lieve Mr. Schiff demonstrated again a much more responsible pos-
turing than I have seen of other of his colleagues from the other
side of the aisle.
Let me also identify myself, Mr. Chairman, with remarks of Mr.
Lantos. I hope that you take those very seriously when he said that
you should go back and make sure that this Administration under-
stands that we expect this Administration to enlist more financial
support from our allies, especially the moderate Muslim allies that
we have, which are now involved in a windfall of profit from the
expansion of oil prices. They should be helping out more in the cost
of reconstruction of Iraq.
They cannot expect the American people to bear this burden
alone. We should have more support from the Saudis and the peo-
ple from Qatar and Kuwait and others, other countries that are
now flush with cash. That is a message that I hope you will take
back and take very seriously, and that is certainly a bipartisan
message to you today.
Let me note that in the very beginning of this conflict there was
a decision that had to be made as to how it would be paid for. The
Administration decided that instead of presenting the Iraqis with
a bill that we would instead take this burden upon the American
people. I think that was a horrible mistake in the beginning.
Again, if the American people did not feel that they were car-
rying an unfair share of burden of this conflict, I think there would
be more support of the long-term commitment that is necessary to
win such a conflict that we are in.
Instead, the Administration chose again to consider the econom-
ics of international interest and other countries' interest other than
the interest of the American taxpayer. At a time when again the
price of oil has gone up and the value of the oil that Iraq sits on
top of has so dramatically increased, the Iraqi people should be ex-
pected.
We could have coupled a policy forgiving the debt from Saddam
Hussein, which should have been forgiven and should have been
wiped off the books because the people of Iraq, that was a dictator-


50
We do have 3 million more Iraqis consuming potable water than
we had before the war. Stuart and I disagree and we are having
a hard time figuring out what the level was before, but we are in
agreement that there are 3 million more. It is the same thing with
5 million more people have access to sewerage.
There are 6 million cell phones in Iraq. There were almost none
before we liberated the country. Internet cafes have sprung up ev-
erywhere. Around Iraq we talk about electricity problems all of the
time largely because we focus on Baghdad, and there are several
reasons for that, but in the rest of the country, sir, there is much
more electricity per day than there was before 2003 because Sad-
dam cut electricity in much of the rest of the country to keep Bagh-
dad burning 24 hours a day.
There has been perceptible, measurable increases in a variety of
areas. These are not enough to satisfy the Iraqi people, who have
suffered under a terrible tyranny for 30 years and are thirsty to re-
turn to the era when Iraqi per capita income was that of Spain. It
is now one of the lowest in the world.
We have a long way to go. We are very, very cognizant of that.
We are impatient ourselves. Thank you, sir.
Mr. Engel. Can I just say that the former director of USAID,
Mr. Natsios, made some public statements recently, and he said
that the Coalition Provisional Authority really has been inept in
overseeing the reconstruction of Iraq.
He cited the CPA's hiring of ill-qualified personnel, the use of ill-
qualified or corrupt contractors and the lack of proper management
and accountability systems to oversee the reconstruction.
I am wondering if anyone can tell me what measures the Admin-
istration has been undertaking to prevent the incompetence that
was prevalent under the CPA to ensure that the current recon-
struction efforts are being managed properly?
Ms. Ros-Lehtinen. Thank you, Mr. Engel. That is an excellent
question, and perhaps in the next round of questions with the ones
who follow Mr. Engel you can answer that.
I am pleased to yield to Mr. Delahunt for his questions.
Mr. Delahunt. You know, my understanding is that some are
not concerned about the $9 billion that is missing. It is still $9 bil-
lion. If it is Iraqi money, some would suggest that is okay as long
as it is not American dollars.
I don't think that is your position, Mr. Bowen, because that $9
billion could have been utilized in a very effective way and move
things along, so I would suggest that those who say well, that is
not American taxpayers' money, I think that is a real error because
maybe if we had $9 billion we would be further along in terms of
the reconstruction and getting out of there. Would you agree with
that, Mr. Bowen?
Mr. Bowen. I would agree with it, and I issued the audit because
I was concerned about the issue.
Mr. Delahunt. I know. I read the audit. Great work, okay?
The Ambassador indicated earlier that we had to go in there be-
cause I think he said something like the UN asked us to. Well, I
don't think it was the UN that asked us into Iraq to begin with.
I don't want to misstate your words, but
Mr. Jeffrey. No. I didn't mean it that way.


52
Mr. Kunder. I disagree with his current assessment, yes.
Mr. Delahunt. Okay. Thank you.
I would like to get to the issue of the donor nations. My under-
standing is that according to reports recently Iran is prepared to
participate in the reconstruction.
In fact, I thought it was interesting that the new Prime Minister
indicated that—let me quote—"Iran has a right to develop nuclear
technology, and the international community should drop its de-
mands that Tehran prove that it is not trying to build nuclear
weapons." I find that kind of an interesting development.
Do you care to comment, Ambassador, and do we welcome the
Iranian participation in the reconstruction of Iraq?
Mr. Jeffrey. The Iranians are contributing with $10 million as
a Madrid pledge in the Iraq reconstruction facility. As Secretary
Rice said last week in talking about our policy toward Iran, we look
forward to the day when they do responsible things, and we
will
Mr. Delahunt. Ambassador, were you surprised somewhat by
his comment relative to let us lay off Iran and pressing them on
the nuclear weapons issue?
Mr. Jeffrey. I was not totally surprised because I think that the
Iraqis have to live with a big and potentially very aggressive neigh-
bor, and I think that we will work with them to ensure that in the
future
Mr. Delahunt. So we don't have a problem if Iraq supports the
Iranian position in terms of the development of enriched uranium?
Mr. Jeffrey. I wouldn't characterize it that way, but if Iraq did
we would certainly have a problem, sir.
Ms. Ros-Lehtinen. Thank you, Mr. Delahunt.
Mr. Sherman, I apologize for bypassing you. You have 3 extra
minutes for that. Thank you. I apologize.
Mr. Sherman. I don't know whether I will afflict all of our col-
leagues here with a full 8 minutes, but we will see how it goes.
I want to associate myself with Mr. Lantos' comments about how
Iraq's fellow Arab states should be doing more. I know the response
focused on efforts the Administration is undertaking to get the
Arab states to at least forgive some of the debt. It would sure be
nice to see some cash as well.
I think you are right to focus on debt forgiveness because most
oil rich countries do their development not from aid, but from bor-
rowing, and the amounts of aid that Iraq will receive no matter
how we put it together going forward at least from there were ex-
traordinary amounts of aid that Congress provided in the first 3
years after the liberation, but, going forward, an awful lot of the
development of Iraq is going to be with borrowed funds.
The problem is Iraq can't borrow if it still has enormous debts.
When the first supplemental came to Congress, some $17 or $18
billion, many of us argued that at least half of that should be
loaned, and the Administration was vociferous in saying no, it must
all be aid because Iraq can't afford to borrow. They already have
too many debts.
Now, the Paris Club has forgiven some debts. The Arab states
haven't. Is that correct? I am seeing a soft yes from the Ambas-
sador. He is nodding his head. I will call that a yes.


59
to make them understand that they do have to take these—I will
be honest—terribly hard decisions from their standpoint.
Mr. Caknahan. The other area I want to ask about is really the
training of troops and police forces of the Iraqis.
We toured a very impressive facility in Jordan when we were
there. They had very aggressive goals of training numbers of troops
to get them on the ground. My understanding is those goals have
not been fully reached, and I wanted to ask about where we stand
with the training.
Secondly, I understand we have also had some repeated offers
from Egypt that has training facilities and where we are with those
offers and again looking at other ways to ramp up and speed up
the training process.
Mr. Jeffrey. The training program again is absorbing, assuming
we get the DoD supplemental, almost $15 billion of United States
funding since 2003 and certainly well in excess of $5 billion in Iraqi
money, so it is a major, major effort, and it is producing, as we in-
dicated, 260,000 trained and equipped personnel.
The army training program, basically to get the light infantry
units on the ground and replace a lot of our troops, will be finished
by the end of this year. That doesn't mean that they will have an
army as you and I understand it. They won't have a lot of the logis-
tics. They won't have much of the heavy armor or indirect fire
weapons, but that will come later. The key thing that we put our
priority into was to get their troops out on the ground, and we are
going to be pretty well finished with that.
The police frankly are going to take longer, and that is the long
pole in the tent because police are really important in any
counterinsurgency. With the Iraqi police it is not just a question of
training and equipping them, but it is also getting the Iraqis to do
the job that they need to do.
The second part of your question, sir, was?
Mr. Carnahan. About the Egyptian offer of training.
Mr. Jeffrey. The Egyptian offer. We have sent an Iraqi infantry
unit, for example, in 2004 to Egypt to be trained, but the problem
with that is, as you can imagine, taking a police squad or an army
squad or a football team, an offensive line on a football team. You
can't take those folks and send them off to five different training
centers to train with different tactics, to train with different tech-
niques and such and then put them together and form them as a
team.
Thus, our belief is that training has to be uniform for the police,
and training has to be uniform for the Iraqi army because they are
in a life and death battle. What we are urging people to do is to
contribute to the training facilities in Jordan, to contribute to the
NATO effort where we can have control over that training.
All around the world, and we do it and everybody else does it,
companies and police units and individuals go to another country
and they learn how people do things. That is good for building
interoperability and building good relations, but if you have a life
or death mission of standing up a large force, you want that force
to be standardized. Therefore, I think that using these schools and
using NATO and Jordan is the way to go, sir.


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