U.S. Can’t Account for Billions Spent in Afghanistan
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The Fiscal Times
December 27, 2010

KANDAHAR CITY -- In its bid to win the hearts and minds of Afghanistan’s teeming population, the United States has spent more than $55 billion to rebuild and bolster the war-ravaged country. That money was meant to cover everything from the construction of government buildings and economic development projects to the salaries of U.S. government employees working closely with Afghans.

Yet no one can say with any authority or precision how that money was spent and who profited from it. Most of the funds were funneled to a vast array of U.S. and foreign contractors. But according to a recent audit by the Special Inspector General for Afghanistan Reconstruction (SIGAR), there is no way of knowing whether the money went for the intended purposes. 

…the United States is not demanding accountability
for outgoing funds from U.S. companies
which have little incentive to fully disclose
where the U.S. money is going.

The audit shows that navigating the confusing labyrinth of government contracting is difficult, at best,” SIGAR said in releasing the audit. “USAID, the State Department and the Pentagon are unable to readily report on how much money they spend on contracting for reconstruction activities in Afghanistan.”

One large part of the problem is that the United States is not demanding accountability for outgoing funds from U.S. companies which have little incentive to fully disclose where the U.S. money is going. Add to this the many Afghan companies that have minimal accounting capabilities and you have a recipe for a massive misappropriation of funds. The money flows from Washington to Afghanistan, with little oversight and accountability, and at every step along the way someone else takes a cut.

  

“There’s no mechanism to track where this money is going,” said Scott Amey, general counsel for the Project on Government Oversight, an independent, nonprofit group that investigates government corruption. “Security problems persist and this money doesn’t seem to be accomplishing a real mission.”

As staggering amounts of U.S. tax dollars virtually vanish down a black hole, many of the government projects designed to foster improved relations with the Afghan people and undermine the appeal of the Taliban have fallen far behind schedule or simply aren’t completed. In October, SIGAR found that six Afghan National Police buildings were so poorly built that they are unusable. They were constructed at a cost of $5 million by Basirat Construction, an Afghan construction company.

 
Afghan contractors often pay kickbacks
to local warlords, like Ahmad Wali Karzai, the president’s brother
and the so-called “King of Kandahar.”

Another report found that the United States has spent nearly $200 million on Afghan security service buildings that cannot be used. SIGAR also found that the U.S. Agency for International Development (USAID) couldn’t account for nearly $18 billion that was paid to some 7,000 U.S. and Afghan contractors for development projects. Afghan contractors often pay kickbacks to local warlords, like Ahmad Wali Karzai, the president’s brother and the so-called “King of Kandahar.” Their actions often undermine the work of the coalition.

An editor-at-large for The Fiscal Times, David Francis has reported from all over the world on issues that range from defense to border security to transatlantic relations.