Philip Giraldi: The Corruption of Empire

Philip M. Giraldi, Ph.D. is the Francis Walsingham Fellow at The American Conservative Defense Alliance ( and a former CIA counter-terrorism specialist and military intelligence officer.

Philip Giraldi was the foreign policy advisor to Ron Paul during his last presidential run.

Philip Giraldi

Deputy Secretary of Defense Paul Wolfowitz predicted in 2003 that the cost of the Iraq war would be covered by Iraqi oil revenue, which would also pay for reconstruction. The Iraq war has in fact cost the United States more than $900 billion, including more than $145 billion US and Iraqi dollars for rebuilding and local contracting to support US forces. Six years of reconstruction has been a failure, with most projects unfinished or so poorly built that they have been abandoned. Water and electricity has not been restored to the level enjoyed under Saddam Hussein. Even those inclined to look on the bright side acknowledge that at least $13 billion has been lost to fraud, theft, and waste. Most would put the number much higher, possibly as much as $125 billion if one includes both American and Iraqi money.

Just as the United States is winding down its reconstruction of Iraq, the largest nation building project in history, President Obama wants to do the same for Afghanistan only do it better and bigger. Before he gets in too deep, he should listen to the non-partisan Government Accountability Office (GAO) which is sounding alarm bells over concerns that the White House is not sharing with it plans for the reconstruction. GAO envisions massive multi-billion dollar shortfalls bringing projects crippled by corruption and waste grinding to a halt. Government auditors note that more than $5 billion in reconstruction funds already cannot be accounted for in Afghanistan.

Obama is gambling that the pervasive corruption in Iraq can somehow be avoided. It is a risky bet, both because corruption is a genie that is hard to return to the bottle and because bribery in Afghanistan, like in Iraq, is a bedfellow of government. And, tragically, it has taken hold among the American occupiers. When American military officers ran the Iraqi Defense Ministry in 2004-5, an entire year’s procurement budget of $1.3 billion disappeared on “contracts” signed in Poland and Pakistan for materiel that was never delivered. As as the New York Times’ Frank Rich put it astutely, in Iraq “corruption has been at the center of the entire mission,” possibly even a primary factor in the failure of the reconstruction program, a calamity that has hitherto been blamed on inadequate planning and a high level of violence.

The United States has never lacked for war profiteers aided and abetted by dishonest officials but the Iraq War has elevated corruption to a new level. In an environment in which many billions of unaccountable dollars were stacked in shrinkwrap pallets or floating around without any real oversight, it was perhaps inevitable that corruption would establish a new gold standard. Efforts to overcome fraud and waste might eventually become, as one observer has put it, the “second war” in that unhappy land. It was also inevitable that the corruption involving Iraqis would sooner or later ensnare the Americans involved, demonstrating once again that war produces “blowback” that damages the institutions of victor and vanquished alike.

The United States has spent $145 billion on reconstruction and military support projects in Iraq. The reconstruction money, which is twice what was spent on rebuilding post-World War II’s devastated much larger and more populous Japan, has mostly been wasted. Numerous American officials, particularly those involved in contracting, have been investigated for corruption. There have been twenty-nine convictions, several suicides, and the investigations and trials promise to drag on. It is reported that more than two dozen indictments of Americans are pending.

Army contracting officer Major Gloria Davis and Air Force procurement officer Charles Riechers both committed suicide over contracting fraud while Colonel Ted Westhusing shot himself after sending an accusatory letter to General David Petraeus concluding “I cannot support a mission that leads to corruption, human rights abuse and liars.” Some believe that Westhusing was murdered because he was about to turn whistle blower.

Robert Stein, the former US Coalition Provisional Authority (CPA) controller for South Central Iraq, was one of the first successful prosecutions for corruption. Stein diverted $8.6 million through a business run by Californian Philip Bloom. Bloom admitted paying more than $2 million in bribes to US officials including four Army Colonels—Curtis Whiteford, Bruce Hopfengardner, Debra Harrison, and Michael Wheeler. Army Major John Cockerham accepted nearly $10 million in bribes while in Kuwait and his successor Army Major James Momon received $5.8 million. Army Major Christopher Murray, Army Lt. Col. Levonda Selph, Army Major John Rivard, Captain Michael Dung Nguyen, and Captain Bryant Williams have all been imprisoned for taking bribes. In Iraq’s Anbar province, local Iraqis report that US officers routinely demand 15% of all reconstruction project funds.

One corruption whistleblower might even have been killed. American businessman Dale Stoffel went to the US authorities in Baghdad to complain that US military officers had been taking bribes in pizza boxes stuffed with hundred dollar bills at the contracting offices to conceal the payments. The use of dead drop points for leaving cash in paper bags was common throughout the green zone. Stoffel was threatened and was murdered in December 2004. Two US military officers, Army Colonel Anthony Bell and Air Force Lieutenant Colonel Ronald Hirtle, were identified by Stoffel before his death and are currently reported to be under investigation.

Particularly disturbing is the growing evidence of widespread involvement of senior US military officers and civil servants in the corruption, which was driven by windfall profits on contracts requiring little or no work. Apart from the Army and Air Force officers who have gone to prison, reports from Kuwait suggest that at least sixteen American flag officers, generals and admirals, are currently under investigation by the Justice Department, the Special Inspector General for Iraq Reconstruction (Sigir), or by the Department of Defense. Sigir alone has carried out 300 investigations and more than 250 audits. Government sources report that 154 criminal investigations are still open.

The assumption that Afghanistan will somehow be different than Iraq might actually mean that it will be worse. Where Iraq had a recent history of functioning governments Afghanistan does not. Where Iraq had a decent infrastructure of roads and tradition of the government providing services, Afghanistan does not. What Afghanistan does share with Iraq is pervasive corruption at all levels of government at all times. A total of $32 billion have already been largely wasted on reconstruction projects in Afghanistan, making potential donors nervous about further engagement where there is so little to show. The Europeans have already made it clear that they want out at the first opportunity.

So as the US presence in Iraq winds down there is a lesson to be learned. Military occupation inevitably corrupts the occupier. Many US military officers involved in managing the billions of dollars spent on reconstruction and support of allied forces have succumbed to temptation. Afghanistan might well be different, but there is no reason to assume that to be the case. Indeed, given the harsh physical environment and pervasive corruption in Afghanistan itself everything might well be worse. If it is not too late to halt the march of the juggernaut, it might be wise for the Obama Administration to step back and consider what it is doing. The nation building exercise in Iraq was brought to its knees at least in part by corruption which has spread alarmingly among US government officials eager to take their share of the easy money and that experience will likely be repeated in Afghanistan. Is it worth repeated that experience in support of a war that makes no sense and that is surely being lost? Undoubtedly, no.

By Philip Giraldi
Published 08/31/09

Source: Campaign For Liberty

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