GAO: Iraq rakes in billions in oil profits while the United States pays for reconstruction

Crossposted from our new home blog,They gave us a republic...

***************

The dramatic increase in oil prices has positioned Iraq, which sits atop the third largest oil reserve in the world, to begin to bear some of the burden of reconstruction of that war-torn country, decimated by more than two decades of war and sanctions.

In a GAO report released yesterday, the government watchdog was deliberate in avoiding assignation of who-should-pay-for-what and thus the politics of the matter. Instead, they did what they do best and stuck to facts and figures - but in so doing, the report leaves little doubt that Iraq can afford to pony over a bit more dough for its own reconstruction. Iraq took in just under $33 Billion in oil revenues in the first six months of 2008, and is on pace to rake in between $67 and $79 Billion this year, meaning Iraq could see a budget surplus of between $38.2 billion and $50.3 billion this year alone. The GAO estimates that this years oil revenues will be double the average annual oil revenues that were realized from 2005 through 2007. The GAO based their projections for the second half of the year on actual sales through the first half, and assumed an average export price from $96.88 to $125.29 per barrel and oil export volumes of 1.89 to 2.01 million barrels per day.


As oil prices settle down at around $125 per barrel, after exceeding $140 just a few weeks ago, Iraq could post a budget surplus of between $33 billion and $50 billion this year. This windfall comes in spite of the fact that Iraq has yet to approach pre-invasion oil-production levels.

Between 2005 and 2007, the government of Iraq spent approximately $67 billion on government operations and investments in the greater society. About 90% was spent on operations, and 10% was invested in structures and durable goods. A mere one percent was spent on maintaining the country. Instead the United States has been footing that bill. Buildings, infrastructure for the delivery of water and electricity, and weapons for the countries police and security forces.

Even as total expenditures grew from 2005 through 2007, the country was unable to spend all of the budgeted funds. For example - last year, 2007, Iraq spent 80% of ths $28 billion operating budget and 28% of its investment budget. GAO estimates that in 2008, Iraq will spend less than $40 billion of its nearly $50 billion budget.

At the end of 2007, the Iraqi government had financial deposits of $29.4 billion, held in the Development Fund for Iraq and other deposits made in the name of the central government in the Central Bank of Iraq and Iraq’s commercial banks. This balance is due to budget surpluses of about $29 billion between 2005 and 2007.



And then there are the American numbers.

Since FY 2003, when the U.S. appropriated approximately $48 billion for stabilization and reconstruction efforts of post-invasion Iraq. As of June 2008, about $42 billion of that amount had been obligated. Of that $42 billion, the United States has spent more than $23 billion on security and critical infrastructure, such as water, electricity and oil. Compare that expenditure with the $3.9 billion spent in these sectors by Iraq between 2005 and April of this year.

Now there are multiple reasons why the Iraqi government has been unable to invest more of its money on capital improvements, and some of those shortcomings were created by the United States and our coalition allies when civil servants were summarily fired by the Coalition Provisional Authority (CPA) and barred from public service for being members of the Bath Party (a requirement for government employment) under the Saddam Hussein regime. When the people who know how to work the levers are not allowed to touch the machine, it doesn't work.

De-bathification was a factor in several areas of shortfall, from operations to procurement and budgeting. De-bathification coupled with sectarian violence and the "brain drain" that resulted from the middle class fleeing the country made government operations in Iraq ineffectual at best. These factors converged and conspired to make it necessary for the United States to fund activities of key ministries to even get the country on a footing where it could begin to execute it's own budget priorities.

Now let me be clear that it is not my intent to debate who should be paying for the reconstruction. If I had my druthers we would be able to unring the bell, unselect George Bush, uninvade Iraq and unhang Saddam Hussein. But as none of that is possible, we have to look at the situation at hand and make realistic assessments. And reality dictates that the United States can not keep up the level of spending we have been engaged in in Iraq. Certainly not with all the problems we face at home.

***************

Remember to update your blogrolls and bookmarks with our new domain name,

They gave us a republic...

The GAO Exposes a Possible Cayman Islands Sham

It's one thing to hear stories about the tax havens in various parts of the world, such as the Cayman Islands. It's another thing when you find out the Government Accountability Office has been busily compiling the information for Congress. That's a pretty good sign that someone is finally going to close the loopholes.

The Cayman Islands is a major offshore financial center and the registered home of thousands of corporations and financial entities. Financial activity there is in the trillions of dollars annually. One Cayman building--Ugland House--has been the subject of public attention as the listed address of thousands of companies.

GAO was asked to study

(1) the nature and extent of U.S. persons' involvement with Ugland House registered entities and the nature of such business;
(2) the reasons why U.S. persons conduct business in the Cayman Islands;
(3) information available to the U.S. government regarding U.S. persons' Cayman activities; and
(4) the U.S. government's compliance and enforcement efforts.

The facility known as Ugland House is of particular importance to anyone who wants to know what's going on in the Cayman Islands.

Shurna Robbins for The New York Times

This is the hub of what could be a lot of shady dealing. And you also have to acknowledge that much of what they do there is probably perfectly legal as well. Ugland House is where a law firm and a company-services provider named Maples and Calder is housed. The company has a list of 18,857 entities tied to it that draw from a mostly international list of clients. According to a person at that business, about 5 percent of these entities were companies that were owned entirely by US persons but--and this is important to note--some 40 to 50 percent of their clients had a U.S. billing address. Obviously, we need more information on what is going on.

Information about U.S. persons' Cayman activities comes from self-reporting, international agreements, and less formal sharing with the Cayman government. Because there is often no third-party reporting, self-reported information may be vulnerable to being inaccurate or incomplete. U.S. officials said the Cayman government has been responsive to taxpayer-specific information requests. The Internal Revenue Service has several initiatives that target offshore tax evasion, including cases involving Cayman entities, but oversight and enforcement challenges related to offshore financial activity exist. U.S. officials said that cooperation with the Cayman Islands government has been good. Also, Maples partners said that ultimate responsibility for compliance with U.S. tax laws lies with U.S. taxpayers.

That's why I think this is a sham--there's no accountability or oversight and who really thinks there aren't at least a few US individuals who are using the Cayman Islands to hide money that should be taxed? I think the GAO has decided to start exposing this sham, and Congress needs to step in as well.

Here's hoping the GAO can shed a little light onto this tax shelter, and help drive home the fact that these scams are being perpetrated by some heavy hitters. I don't have a whole lot of faith--after all, this isn't the first time the issue has been raised.

Now we just need to find out who the heavy hitters are and what they're doing.

--WS

GAO Releases Report on Border Security

The timing of this report is critical because we are seeing a flurry of stories about the border region of Mexico and the US which suggests that the area is spinning out of control. The Department of Homeland Security is simply not up to the task of setting a long term agenda.
The GAO found that the Secure Border Initiative (SBI) was compliant with the majority of benchmarks, but failed to comply with a requirement that stated:

A description of how activities will further the objectives of SBI, as defined in the SBI strategic plan, and how the plan allocates funding to the highest-priority border security needs.

And that is the entire report in a nutshell--the GAO determined that DHS has no articulated plan that tells the American people how the SBI will achieve anything resembling a long term goal, like you know--securing the border. Without a long term plan, what's the point? How sad is it that the GAO, which has a pretty wide latitude with what it decides, ultimately had to decide that the DHS has no vision of how it will achieve anything?

Back in February, it was revealed that one of the components of the SBI, the virtual fence, was a failure:

The failure of the virtual fence was inevitable, a combination of an unrealistic and heavily politicized policy imperative, untested technology hastily fielded with little input from subject-matter experts, a contractor that understands airplanes a lot better than systems integration, and poor management by the federal government’s least experienced bureaucracy.

The only good news here is that the Department of Homeland Security was not building an airplane. The technology used to build the virtual fence was designed to rise only a few feet off the ground on a series of towers along the southwest and eventually the northern border. Its maiden voyage didn’t kill anyone, but it wasted millions of dollars that DHS can ill afford to lose.

So the question is: What do we do now? Given that the Bush administration will leave office in less than a year, picking up the pieces of this flawed project will largely fall to Congress and the next administration.

Well, I would argue that until we ELIMINATE the structure of the Department of Homeland Security--that is, break it up and put things back largely the way they were--we're never going to see meaningful progress. The DHS is the only agency that has never been under Democratic control and is entirely the creation of Joe Lieberman. In turn, Lieberman has failed to provide even the most basic example of oversight of DHS in the Senate. Years and years of incompetence, paralysis and wasteful spending have created the ultimate example of Republican governance--a terrible agency that can't do anything. Mission accomplished, Republican Party--you've proven that government can't do anything right. So, step aside while we fix the DHS problem.

Once that's done, we have to stop this crap--and you'll be excited to hear that corrupt broke-ass wingnut ex-Congressman J.D. Hayworth has dedicated himself to paying off his debts by hosting a radio show that gets everything wrong:

Immigration and Customs Enforcement (ICE) said three suspects arrested in a Monday morning Phoenix home invasion and homicide were not members of the Mexican Army.

"We have no indication whatsoever that any of the individuals were involved with formal military in Mexico," said Vincent Picard of ICE.

The incident at 8329 W. Cypress St. resulted in the death of the homeowner. Between 50 and 100 rounds were fired at the house.

While on the J.D. Hayworth show Tuesday, a top member of a Phoenix police union announced that the suspects were active members of the Mexican Army hired by drug cartels to perform home invasions and murders.

Phoenix Police Enforcement President Mark Spencer said a police officer told him that one of the men captured said they were completely prepared to ambush Phoenix police, but ran out of ammunition. Click Here to listen to the entire interview.

He added that all of them were dressed in military tactical gear and armed with AR-15 assault rifles. Three other men involved in the invasion escaped.

Way to go there, JD. The environment for any discussion of these issues is toxic, thanks in large part to the efforts of the right wing in this country to demonize people and lie through their teeth. It helps them justify paying billions to companies that fail to do what they've been contracted out to do. In order to cover up the incompetence and greed, the right wing has to whip people up in a frenzy and get them mad at the wrong issue and the wrong people.

In other words, is it January 20, 2009 yet?

The GAO Reminds Us Why The Republicans Can't Be Trusted to Defend America

Are you safer today than you were eight years ago?

When the Government Accountability Office (GAO) decides to look at anything controlled by the Department of Homeland Security (DHS), you might as well sit back and get out a few highlighters, because what you're going to get is enough to fill as many blog posts as you want to try to do in one day.

In testing ports of entry, undercover investigators carried counterfeit drivers' licenses, birth certificates, employee identification cards, and other documents, presented themselves at ports of entry and sought admittance to the United States dozens of times. They arrived in rental cars, on foot, by boat, and by airplane.

Oh, crap!

They attempted to enter in four states on the northern border (Washington, New York, Michigan, and Idaho), three states on the southern border (California, Arizona, and Texas), and two other states requiring international air travel (Florida and Virginia). In nearly every case, government inspectors accepted oral assertions and counterfeit identification provided by GAO investigators as proof of U.S. citizenship and allowed them to enter the country.

Double crap!

In total, undercover investigators made 42 crossings with a 93 percent success rate. On several occasions, while entering by foot from Mexico and by boat from Canada, investigators were not even asked to show identification. For example, at one border crossing in Texas in 2006, an undercover investigator attempted to show a Customs and Border Protection (CBP) officer his counterfeit driver's license, but the officer said, "That's fine, you can go" without looking at it.

Oh noes!

Here's a classic picture, one that should be hung on the wall of every wingnut in America:


What could possibly be in that duffel bag? A thermonuclear device? Dirty laundry? A bag of cash for someone who wants to build an Embassy in a Middle Eastern country?

I don't have the embed link, but here's the GAO video of these activities:

The GAO chronicles the absolute farce that is our border security. While the wingnuts go on Fox News and screech about a missile that Iran doesn't have that can carry a nuclear weapon Iran doesn't have, the people who run this administration have installed the most inept people in American History as leaders of the worst idea in American history--the Department of Homeland Security.

The next President should immediately disband and deactivate and disperse the Department of Homeland Security. DHS is a an unmitigated failure and a disgrace:

In contrast to our observations on the northern border, our investigators observed a large law enforcement and Army National Guard presence near a state road on the southern border, including unmanned aerial vehicles. On October 17, 2006, two of our investigators left a main U.S. route about a quarter mile from a U.S.–Mexico port of entry. Traveling on a dirt road that parallels the border, our investigators used a GPS system to get as close to the border as possible. Our investigators passed U.S. Border Patrol agents and U.S. Army National Guard units. In addition, our investigators spotted unmanned aerial vehicles and a helicopter flying parallel to the border. At the point where the dirt road ran closest to the U.S.–Mexico border, our investigators spotted additional U.S. Border Patrol vehicles parked in a covered position. About three-fourths of a mile from these vehicles, our investigators pulled off the road. One investigator exited the vehicle and proceeded on foot through several gulches and gullies toward the Mexican border. His intent was to find out whether he would be questioned by law enforcement agents about his activities. He returned to the vehicle after 15 minutes, at which time our investigators returned to the main road. Our investigators did not observe any public traffic on this road for the 1 hour that they were in the area, but none of the law enforcement units attempted to stop our investigators and find out what they were doing. According to CBP, because our investigators did not approach from the direction of Mexico, there would be no expectation for law enforcement units to question these activities.

The GAO also did this:

Took photographs of over half a dozen locations where state roads ended at the U.S.–Canada border

They noted that:

• No visible law enforcement response despite suspicious activity
• No observable electronic monitoring equipment
• CBP stated that our activities would not be grounds for a formal investigation

Then they:
Simulated the cross-border movement of radioactive materials or other contraband into the United States from Canada
And they noted that there was:

• No visible law enforcement response
• No observable electronic monitoring equipment

GAO's investigators also:
Simulated the cross-border movement of radioactive materials or other contraband into the United States from Canada
And recorded that:

• Some surveillance cameras and law enforcement presence noted along the road
• Investigators crossed the border into the United States in a spot that appeared to be unmanned and unmonitored, then returned to Canada

Here's a little more information about that "unmanned" border crossing station:

We also identified several ports of entry with posted daytime hours in one state on the northern border. During the daytime these ports of entry are staffed by CBP officers. During the night, CBP told us that it relies on surveillance systems to monitor, respond to, and attempt to interdict illegal border crossing activity. For example, on November 14, 2006, at about 11:00 p.m., our investigators arrived on the U.S. side of one port of entry that had closed for the night. Investigators observed that surveillance equipment was in operation but that the only visible preventive measure to stop an individual from entering the United States was a barrier across the road that could be driven around. CBP provided us with records that confirmed our observations about the barrier at this port of entry, indicating that on one occasion a cross-border violator drove around this type of barrier to illegally enter the United States. Although the violator was later caught by state law enforcement officers and arrested by the U.S. Border Patrol, we were concerned that these ports of entry were unmanned overnight.

So what we have, after seven and a half years of the Bush Administration being warned repeatedly to do something, is border security on the honor system.

We have, in effect, the Otis the Drunk rule as our policy of defending America:



Remember, terrorists--Andy leaves the jail unlocked and he leaves the key to your cell hanging on the wall. Lock yourself in for the night and sleep it off.

"We requested comments from DOD, but none were provided"

The Government Accountability Office makes some nifty charts:

From fiscal year 2001 through fiscal year 2007, and for the first quarter of fiscal year 2008 through December 2007, Congress has provided DOD with a total of about $635.9 billion for its efforts in support of GWOT. DOD has reported obligations of about $562 billion for military operations in support of the war from fiscal year 2001 through fiscal year 2007 and for the second quarter of fiscal year 2008 through March 2008. The $73.9 billion difference between DOD's GWOT appropriations and reported obligations can generally be attributed to certain fiscal year 2008 appropriations and multiyear funding for procurement; military construction; and research, development, test, and evaluation from previous GWOT-related appropriations that have yet to be obligated and obligations for classified and other activities, which are not reported in DOD's cost-of-war reports. As part of our ongoing work, we are reviewing DOD's rationale for reporting its GWOT related obligations. Of DOD's total cumulative reported obligations for GWOT through March 2008 (about $562 billion), about $435.1 billion is for operations in and around Iraq as part of Operation Iraqi Freedom, and about $98.9 billion is for operations in Afghanistan, the Horn of Africa, the Philippines, and elsewhere as part of Operation Enduring Freedom. The remaining about $28 billion is for operations in defense of the homeland as part of Operation Noble Eagle. In fiscal year 2008, through March 2008, DOD's total reported obligations of about $69.8 billion are about half of the total amount of obligations it reported for all of fiscal year 2007. Reported obligations for Operation Iraqi Freedom continue to account for the largest portion of total reported GWOT obligations by operation--about $57 billion. In contrast, reported obligations associated with Operation Enduring Freedom total about $12.7 billion, and reported obligations associated with Operation Noble Eagle total about $89.3 million.

DOD’s Cumulative Reported GWOT Obligations and Cumulative GWOT Appropriations for Fiscal Years 2001 through 2007 and through the Second Quarter of Fiscal Year 2008 (October through March 2008):



DOD’s Reported GWOT Obligations for Fiscal Years 2001 through 2007 by Operation:





And, as usual:

Agency Comments and Our Evaluation
We requested comments from DOD, but none were provided.

Anyway, that's where the money is going--into the stratosphere.

How the EPA found a way to fall on it's sword one more time in the waning days of Bu$hCo

In March of this year, the GAO warned that the EPA's IRIS (Integrated Risk Information System) database was at risk of becoming obsolete because the EPA is buried under pending assessments of threats posed by chemicals present in the environment. When I say it is buried, that is almost an understatement. In fiscal years 2006 and 2007, a total of four assessments were completed of thirty two submitted over the same period of time. Currently, over seventy assessments are pending. [The chart below, found on p.7 of the report illustrates the increase in the backlog and the decrease in completion of reporting.]



In response to the GAOs findings, in early April the EPA issued it's revised IRIS assessment process, supposedly aimed at streamlining the process and promoting transparency and increasing confidence in the credibility of assessments. Instead, the changes the EPA employed gave the White House the ability to further obstruct the process. Under the guise of "streamlining" another layer was added - bringing the Office of Management and Budget into the mix, and the OMB promptly started two investigations that are holding up the release of assessments.

Earlier this week, the GAO weighed in on the EPA's "efforts."

EPA’s new process expressly defines such comments as “deliberative” and excludes them from the public record. GAO continues to believe that it is critical that input from all parties—particularly agencies that may be affected by the outcome of IRIS assessments—be publicly available. In addition, the estimated time frames under the new process, especially for chemicals of key concern, will likely perpetuate the cycle of delays to which the majority of ongoing assessments have been subject. Instead of significantly streamlining the process, which GAO recommended, EPA has institutionalized a process that from the outset is estimated to take 6 to 8 years to complete. This is problematic because of the substantial rework such cases often require to take into account changing science and methodologies. Since EPA’s new process is not responsive to GAO’s recommendations, the viability of this critical database has been further jeopardized. [p.2]

Another change keeps comments from other federal agencies on assessments out of the public record.

It is important that the comments of other agencies be included in the public record because although IRIS assessments are not by nature regulatory, quantitative IRIS values are one of the data points considered when risk-management decisions are made and therefore they serve as a benchmark of regulatory consideration.

This process is obstructed by the fact that the completion process for assessments is so dismal. Because of the staggering backlog, the EPA has been unable to complete assessments of key chemicals that are in the forefront of public health concern for their known health risks, including carcinogenic and mutagenic properties. Chemicals awaiting formal assessment include known offenders like trichloroethylene (TCE), naphthalene, tetrachloroethylene, dioxin, and formaldehyde.

And just when you thought that the process was just about manipulated to the max - they manage to throw one more spanner in the works - unlike every other department in FDA and pretty much all departments across all agencies of the federal government - there is no timeline for completion of assessments.


IRIS was put in place in 1985 to increase constituent confidence in the agency and the governments ability to protect it's citizens, after high-profile chemical contamination cases led to the abandonment of first Love Canal, New York in 1981, and then Times Beach, Missouri in 1985. The database was conceived of as a sort of clearing house for information on toxic chemicals.

Its importance has increased over time as EPA program offices and the states have increasingly relied on IRIS information in making environmental protection decisions. Currently, the IRIS database contains assessments of more than 540 chemicals. According to EPA, national and international users access the IRIS database approximately 9 million times a year. EPA’s Assistant Administrator for the Office of Research and Development has described IRIS as the premier national and international source for qualitative and quantitative chemical risk information; other federal agencies have noted that IRIS data are widely accepted by all levels of government across the country for application of public health policy, providing benefits such as uniform, standardized methods for toxicology testing and risk assessment, as well as uniform toxicity values. Similarly, a private-sector risk assessment expert has stated that the IRIS database has become the most important source of regulatory toxicity values for use across EPA’s programs and is also widely used across state programs and internationally.

Historically and currently, the focus of IRIS toxicity assessments has been on the potential health effects of long-term (chronic) exposure to chemicals. According to OMB, EPA is the only federal agency that develops qualitative and quantitative assessments of both cancer and noncancer risks of exposure to chemicals, and EPA does so largely under the IRIS program. [p.3]

When the GAO revisited the system changes that the EPA announced in April, they discovered that the new tweaks were actually counterproductive. The new requirement that OMB review assessments contributes to the backlog - assessments completed by the EPA essentially stnd on line awaiting OMB approval before they are released. And every single delay presents the distinct possibility that the entire process will have to be started over again as methodologies and best practices advance.

Further, because EPA staff time continues to be dedicated to completing assessments in the backlog, EPA’s ability to both keep the more than 540 existing assessments up to date and initiate new assessments is limited. Importantly, EPA program offices and state and local entities have requested assessments of hundreds of chemicals not yet in IRIS, and EPA data as of 2003 indicated that the assessments of 287 chemicals in the database may be outdated—that is, new information could change the risk estimates currently in IRIS or enable EPA to develop additional risk estimates for chemicals in the database (for example, developing a cancer potency estimate for assessments with only noncancer estimates). In addition, because EPA’s 2003 data are now more than 4 years old, it is likely that more assessments may be outdated now.

The consequences of not having current, credible IRIS information can be significant. EPA’s inability to complete its assessment of formaldehyde, which the agency initiated in 1997 to update information already in IRIS on the chemical, has had a significant impact on EPA’s air toxics program. Although in 2003 and 2004, the National Cancer Institute and the National Institute of Occupational Safety and Health (NIOSH) had released updates to major epidemiological studies of industrial workers that showed a relationship between formaldehyde and certain cancers, including leukemia, EPA did not move forward to finalize an IRIS assessment incorporating these important data. Instead, EPA opted to await the results of another update to the National Cancer Institute study. While this additional research was originally estimated to take, at most, 18 months to complete, at the time of our report (more than 3 years later) the update was not complete. In the absence of this information, EPA’s Office of Air and Radiation decided to use risk information developed by an industry-funded organization—the CIIT Centers for Health Research—for a national emissions standard. This decision was a factor in EPA exempting certain facilities with formaldehyde emissions from the national emissions standard.[p.7-8]

Yes -you caught that right. Data from a study funded by the chemical industry was used to formulate the assessment of health risk for formaldehyde. The mind boggles...

Actually, what they have done by intent is what has occurred by accident and derailed a thousand promising research projects. I spent a big part of my career in research labs, and we have a name for the phenomenon they have employed by design. We call it "paralysis by analysis."

The EPA is yet another federal agency that has been crippled and undermined, kept from completing it's mission, and the detriment of the agency has served to the benefit a select few who have been allowed to operate under outdated assessments and continue polluting at unsafe rates.

The next president needs an EPA chief with a strong background in toxicology and environmental sciences. And the balls to stand up to gigantic, polluting corporations who perceive the best interest of human beings - especially poor and powerless ones - to be diametrically opposed to their own.

The next person to head up the EPA will be tackling a thankless job, and have to do battle every day - but battle he or she must, because the job they will be tasked with will have an impact on the quality of life and health of future generations for the foreseeable future.

A Day of Reckoning Is Coming

The Government Accountability Office (GAO) weighs in on the use of contractors:

In 2006, 52 major defense contractors employed 86,181 of the 1,857,004 former military and civilian personnel who had left DOD service since 2001. This number includes 2,435 former DOD officials who were hired between 2004 and 2006 by one or more of the contractors and compensated in 2006, according to our match of DOD and IRS data. These officials had previously served as generals, admirals, senior executives, program managers, contracting officers, or in other acquisition positions which made them subject to restrictions on their post-DOD employment. We found 1,581 of the 2,435 former DOD officials—about 65 percent—were employed by seven of the contractors: Science Applications International Corporation (SAIC), Northrop Grumman, Lockheed Martin Corporation, Booz Allen Hamilton, Inc., L3 Communications Holding, Inc., General Dynamics, and Raytheon Company. In addition, to estimate how closely related work assignments of former DOD officials were to their previous assignments at DOD, we examined in greater detail the job histories of a randomly selected sample of former DOD senior and acquisition officials employed by the contractors.

It is no secret that the Pentagon used many former military officers to "help sell the war in Iraq" and other issues. Regular readers will also remember that one company, Booz Allen Hamilton, has divested itself entirely of government contracting work, selling that part of its business to The Carlyle Group.

Does that mean that a day of reckoning is coming, along with massive cuts or changes? Booz Allen Hamilton seems to be betting that the contracting business is about to implode. While that is likely not the case, large cuts or reforms could radically change the relationship between contractors and the Federal government.

One reason for this is the now exposed lack of ethics and accountability in the federal contracting sector. By focusing on individuals and companies who might have faced mandated "cooling off" periods between their government employment or service and their contracting work, the GAO found a number of companies either didn't ask or weren't able to provide proper ethical guidelines memorandum. These memorandums ensure that the contractor is within guidelines, and what it boils down to is this--a general can leave the military, go to work for a private company, and directly influence or benefit from that military service with no consideration as to whether or not that person brings an unfair advantage in exchange for monetary compensation to that contractor.



The GAO provides what is best described as an "oh shit" moment in the making:

Similar to the requirements of defense contractors, no laws or regulations require DOD ethics or acquisition officials to track or monitor former DOD employees after they begin their new contractor jobs to ensure compliance with applicable post-government employment restrictions. As discussed earlier in this report, past legislative requirements to make the employment of former officials with defense contractors more transparent to DOD by having individuals or contractors report to DOD on the post-government employment with contractors were not successful and were repealed by 1995. However, the changed requirements left DOD without a mechanism to obtain information about its former senior and acquisition officials who go to work for its contractors. In our view, and DOD ethics and procurement officials agree, the information currently available to DOD from providing written ethics opinions to former DOD senior and acquisition officials who request them regarding prospective employment restrictions has limited utility for monitoring compliance with post-government employment restrictions once former DOD officials go to work for defense contractors for several reasons:

• while officials have been encouraged to seek an ethics advisory opinion, they were not required to obtain them, nor were contractors required to ask for them;
• DOD’s record-keeping for its written ethics opinions is decentralized at the many defense ethics offices that issued them; and
• DOD lacks a mechanism for providing the information to contracting officers or program managers for a particular contract.

Nonetheless, for DOD’s purposes, ethics advisory opinions may now be more readily available and centrally located because of the 2008 defense authorization act provision that requires former officials to obtain written ethics opinions on applicable post-government employment restrictions from their DOD ethics officials before accepting compensation from defense contractors for a period of 2 years after leaving DOD service. DOD also has a new record-keeping requirement to retain each request and each written opinion provided in a central database or repository for at least 5 years.

While this requirement may help to increase transparency over which former officials are working with contractors and what may raise a potential conflict of interest, its utility may be limited because information is not being tied to specific contracts. Senior ethics officials in DOD’s Standards of Conduct Office and the director of Defense Procurement and Acquisition Policy and Strategic Sourcing (DPAP), for example, told us that DOD currently does not have a mechanism to link information on former officials’ post-DOD work for their new employers for specific defense contracts that are pending or awarded before their former agencies, offices, or commands. They believed that such a mechanism would be valuable to program managers and contracting officers who need to ensure that contracted work being done in their programs is free of conflicts. They also believed that such a mechanism would be relatively cost-effective to implement. After learning of the results of our data collection efforts, in fact, these officials were concerned that current mechanisms do not provide DOD a clear picture of how many former officials are working with contractors and what risks of conflicts are present.

It would seem that, once the Congress catches up to this issue, there will be a day of reckoning, and the idea of "ethics" could be reintroduced to a community that has benefited greatly from large contracts and inside information. Generally when a lack of accountability occurs in a given area, there is a rush to close the loopholes, solve the underlying issues, and enforce the laws. In this case, billions of dollars of taxpayer money are at stake--much of it has been poured down a rabbit hole already. Discovering that there were significant lapses in the enforcement of ethical guidelines only makes the larger issues of where the money spent for the Iraq war, for example, really went an issue for a reform-minded Congress. The end result of any significant reform would mean that a number of prominent, highly placed and well-compensated individuals would either have to comply with ethical guidelines or see their days of feeding at a considerably large and profitable trough ended abruptly.

GAO Report Highlights Infrastructure Problems

According to the General Accounting Office (GAO), the US needs to reexamine how it funds, improves and rehabilitates its vital surface transportation infrastructure.

Through our prior analyses of existing programs, we identified a number of principles that could help guide a reexamination of the federal surface transportation program. While these principles are designed specifically to reexamine the surface transportation program, most, if not all of them, could be applicable to other federal infrastructure programs. These principles are:

• creating well-defined goals based on identified areas of national interest,
• establishing and clearly defining the federal role in achieving each goal,
• incorporating performance and accountability into funding decisions,
• employing the best tools and approaches to emphasize return on investment, and
• ensuring fiscal sustainability.

The reasons are very clear:

The economic well-being of the United States is dependent on the reliability, safety, and security of its physical infrastructure. The nation’s infrastructure is vast and affects the daily lives of virtually all Americans. In total, there are about 4 million miles of roads, 117,000 miles of rail, 600,000 bridges, 79,000 dams, 26,000 miles of commercially navigable waterways, 11,000 miles of transit lines, 500 train stations, 300 ports, 19,000 airports,5 55,000 community drinking water systems, and 30,000 wastewater treatment and collection facilities. Collectively, this infrastructure connects communities, facilitates trade, provides clean drinking water, and protects public health, among other things.

According to Popular Mechanics, there are ten critically important pieces of US infrastructure that need repair or rehabilitation immediately, including major interchanges, dams, airports, and canal locks.

For example:

In 2006, engineering experts calculated that in any given year there is a 1-in-6 chance that the Herbert Hoover Dike will fail, releasing waters from Lake Okeechobee. If that happened, South Florida's water supply could be contaminated, and 40,000 lakeside residents could be threatened by flooding. The Army Corps of Engineers has been working on improvements, but funding is limited–for the 2009 budget year, the government alloted about half of the requested money. In February 2008, a 1000-ft.-long stretch of dangerously eroded land was found near state-owned floodgates north of the lake.

The collapse of the I-35 bridge in Minneapolis, Minnesota highlighted the need to continue to invest and rehabilitate infrastructure. The cost of replacing bridges that collapse and kill or injure US citizens adds more of a burden are spread to the costs of lawsuits as well as the cost in productivity and wear and tear on other resources when commuters are shunted to other roads and vital arteries.

Kansas Governor Kathleen Sebelius and Service Employees International Union (SEIU) President Andy Stern, warn that turning the financing of infrastructure projects over to Wall Street could lead to another subprime mortgage meltdown:

Leaders of both the Republican and Democratic parties know the U.S. cannot raise money from traditional public sources of financing, including municipal bonds, user fees and taxes.

The financiers on Wall Street already have positioned themselves to take advantage of this national crisis for their own gain. Where most Americans see crumbling bridges and traffic congestion, the money managers see a treasure trove of fees, profits and more record bonuses for CEOs.

It's why some private equity firms and banks on Wall Street are raising massive dollars to buy these assets that have typically been owned and managed by the government.

In recent years, new infrastructure funds have been established in North America with capital commitments of $40 billion to $45 billion. These private funds have sprouted up like weeds, structured for short-term profits and sky-high fees -- usually up to a 2 percent management fee plus up to 20 percent of the profits.

It would be a monumental mistake to turn the future of America's infrastructure over to the same crowd that brought us the subprime crisis, an economy loaded down with debt and recession.

We should know better by now than to create a scenario where bridges and highways are sliced and diced like subprime loans into financially engineered "collateralized infrastructure obligations."

America needs a large source of stable, long-term capital to build the system of buildings, roads and power supplies needed to sustain the country. We need a source of capital that values infrastructure because it provides a reasonable rate of return, strengthens the overall economy and doesn't burden users with excessive fees.

Every decade or so, there is a renewed call for a return to the 1930s and the resurrection of the Civlian Conservation Corps as a means of reducing unemployment, investing in infrastructure, and energizing the American people in an effort to improve their country:

[Civilian Conservation Corps] CCC enrollees throughout the country were credited with renewing the nation's decimated forests by planting an estimated three billion trees from 1933 to 1942.

The 1932 Presidential election was more a cry for help from a desperate people near panic as it was an election in a "landslide" vote, the nation turned to Franklin Delano Roosevelt and the Democratic party searching for an end to the rampant unemployment and economic chaos that gripped the country. They weren't disappointed. Accepting the Presidential nomination on July 1, 1932, New York Governor Roosevelt planned a fight against soil erosion and declining timber resources, utilizing the unemployed of large urban areas.

Professional foresters and interested layman raised these aims. In what would later be called "The Hundred Days," President Roosevelt revitalized the faith of the nation with several measures, one of which was the Emergency Conservation Work (ECW) Act, more commonly known as the Civilian Conservation Corps. With this action, he brought together two wasted resources, the young men and the land, in an effort to save both.



The President wasted no time: He called the 73rd Congress into Emergency Session on March 9, 1933, to hear and authorize his program. He proposed to recruit thousands of unemployed young men, enroll them in a peacetime army, and send them into battle against destruction and erosion of our natural resources. Before it was over, over three million young men engaged in a massive salvage operation, the most popular experiment of the New Deal.

Could an infrastructure revitalization project, based in part on the CCC model, make up for the gaps in what Federal, state and local governments are willing to spend on infrastructure? A proposed pilot program could answer that question, if enacted and studied properly.

Your tax dollars abused

"Too many government employees have viewed purchase cards as their personal line of credit.
It's time to cut up their cards and start over." Sen. Norm Coleman, R-MN

Ya know, it sets my teeth on edge to have to agree with Norm Coleman first thing in the morning. It really, truly does. But that is exactly where I find myself today, reading the GAO report and corresponding Washington Post article on the abuse and misuse of purchase cards by government employees.

About a decade ago, it was decided that department managers, shift supervisors and certain other personnel working in the various and sundry federal departments should have a little latitude. Cards were issues for routine and ordinary purchases. The old procurement process was a bureaucratic nightmare. The old process is where those "speed of government" jokes came from. Let me illustrate by example. In 1988, if a monitor crapped out, an entire workstation would be down for weeks while a new monitor was requisitioned and ordered from a specific supplier who had the contract to supply all of the monitors to a specific government entity. This was stupid, and it was infuriating.

Fast forward one decade...purchase cards were issued to certain federal employees that situations like I just described might be eliminated. People like me had the option of performing the troubleshooting checklist and then going to Office Max or Best Buy or Comp USA and buying a new monitor and getting the workstation back up after lunch instead of having it sit idle for weeks, perhaps months.

Makes sense, right? You trust me with submitting all these man hours to payroll, you can trust me to buy office supplies. Right?

Me personally? Sure. Every penny accounted for properly. Justified, verified and immediate supervisor informed. All "i's" dotted and "t's" crossed. Hand delivered to the appropriate administrator and a receipt requested. Copies made and filed in my file cabinet in my office. No screwing around, since at the end of the journey, I always figured I was ultimately spending my own money, since as a taxpayer I am the origin of the governments funding source.

I'm such a chump!

The GAO found that nearly half the "purchase card" transactions it examined were improper, some because they weren't authorized correctly and others because they did not meet requirements for the cards' use. The audit determined that the overall rate of problems "is unacceptably high."

Nearly $2 million was spent on items such as laptops and digital cameras and can not be accounted for. The Department of the Army charged more than a dozen computer servers worth a hundred grand apiece to the cards, and now can't account for them.

The audit is the culmination of a series of GAO reports over the past decade that have uncovered improper use of government-issued purchase cards at agencies, including the Defense Department and the Department of Homeland Security. Government employees spent nearly $20 billion last year using "SmartPay" cards and related convenience checks, for items ranging from pencils to computers to utility trucks.

Purchase cards, used by about 300,000 government employees in 2007, are essentially the federal government's equivalent of corporate credit cards. Issued by five major banks, they are primarily for transactions under $2,500 but can be used for larger contract payments. All transactions are supposed to comport with federal purchasing guidelines, including proper authorization and documentation.

The latest study used scientific sampling to gauge problems with the cards across numerous federal agencies from July 2005 to September 2006. The report singles out incidents for special criticism as "abusive," "improper" or "fraudulent."

In the fraudulent category, a longtime employee of the U.S. Forest Service in Oregon, Debra K. Durfey, wrote convenience checks worth more than $640,000 from 2000 to 2006 to a live-in boyfriend, who used the money for gambling, car expenses and mortgage payments, according to the GAO and the Justice Department.

The fraud went undetected until a whistle-blower forwarded a tip to the Agriculture Department's inspector general. Durfey, who headed her unit's purchasing office, pleaded guilty last year and was sentenced to 21 months in prison and restitution.

Another fraud case involved the U.S. Postal Service, where an unidentified postmaster used his card to charge $1,100 over a 15-month period for "various online dating services" while he was under investigation for viewing pornography on a government computer. The employee worked out an agreement to remain on sick leave until he retired in 2007 and paid back the money spent on the dating services, according to the GAO report and a Postal Service spokesman.

In a case the GAO deemed "abusive," the Postal Service spent $13,500 in 2006 on a dinner at a Ruth's Chris Steak House in Orlando, including "over 200 appetizers and over $3,000 of alcohol, including more than 40 bottles of wine costing more than $50 each and brand-name liquor such as Courvoisier, Belvedere and Johnny Walker Gold." The tab came to more than $160 a head for the 81 guests, the report said.

A spokesman for the Postal Service, Gerry McKiernan, seemed almost indignant that the expense for the dinner would even raise an eyebrow and he would have to answer questions about it by unctuous guttersnipes from the GAO. "When you're having dinner with customers, it's normal to have a drink," McKiernan asserted.

In another glaring example of perfidy, a State Department cardholder spent $360 at a lingerie boutique in Ecuador. Ostensibly, the expense was for "women's underwear/lingerie for use during jungle training by trainees of a drug enforcement program." No further details of the purchase were revealed, but a State Department official "agreed that the charge was questionable." (Ya think???)

Reading reports like this just disgusts me to my very core. I am easily infuriated by people who just don't know how to act. People who, apparently, have never managed to grow up. Narcissistic brats who think the world owes them something instead of realizing humbly that it's the other way around.

Another system that worked, destroyed by the Bush administration

Both of the authors who post to this blog are good-government Democrats. We took a shine to that government we learned about in ninth grade civics, and have spent the intervening years telling anyone who would listen that we really ought to give it a whirl.

Being good-government Democrats, we have been horrified as agency after agency that serves the public good was gutted and parceled out under this administration. The GAO, the DoJ, the CDC...

One of those things that worked that fell prey to this administration was the EPA library system. (The EPA laboratory system has been decimated, too, but that will be another post.) The facilities started shutting down a couple of years ago, but not a lot of notice was paid to it - scientists protested, but we are a tiny fraction of the population and we are in hostile territory with this anti-science administration any way. We don't get a lot of love from these folks, but we don't sit up at night crying about it, either. We do sit up crying at night over the closing of scientific libraries that provide information and educational services to researchers, academicians and the public at large.

Now the GAO is advising that the EPA continue the moratorium on their restructuring activities and make sure that going forward they are employing best practices and procedures when making changes to the library network.

EPA’s primary rationale for the library network reorganization was to
generate cost savings by creating a more coordinated library network and
increasing the electronic delivery of services. However, EPA did not fully
follow procedures recommended in a 2004 EPA study of steps that should be
taken to prepare for a reorganization. In particular, EPA did not fully evaluate
alternative models, and associated costs and benefits, of library services. EPA
officials stated that they needed to act quickly to reorganize the library
network in response to a proposed fiscal year 2007 funding reduction.

EPA did not develop procedures to inform staff and the public on the final
configuration of the library network, and EPA libraries varied considerably
and were limited in the extent to which they communicated with and solicited
views from stakeholders before and during the reorganization effort. In
particular, EPA’s plan did not include information that the Chemical Library
was to close, and EPA did not inform staff or the public until after the fact.
EPA’s communication procedures were limited or inconsistent because EPA
acted quickly to make changes in response to a proposed fiscal year 2007
funding reduction, and because of the decentralized nature of the library
network. EPA is currently increasing its communication efforts.

EPA does not have a post-reorganization strategy to ensure the continuity of
library services and has not yet determined the full effect of the reorganization
on library services. Moreover, EPA has recently made several changes that
could have impaired user access to library materials and services. For
example, EPA did not determine whether federal property management
regulations applied to the dispersal and disposal of library materials before it
closed the libraries. Furthermore, EPA lacked oversight of the reorganization
process and does not have procedures that would allow the agency to
measure performance and monitor user needs.

Currently, the libraries remaining in the network answer to a variety of different offices. Each office makes general decisions about funding allocations and funding the reorganization activities. When a $2 million budget shortfall was handed down in FY 2007, the EPA specifically directed that the libraries absorb the cuts first, but they did not offer any guidelines or protocols for achieving the reductions. The rationale for the shutdowns and restructuring was cost savings, and no shut-down fees were allocated. The libraries were targeted in spite of being found cost efficient in a 2004 audit, and in spite of providing a unique and important public service. The GAO found that the "EPA did not effectively justify its decision to reorganize the library network because it did not implement a process for conducting a number of analyses, including many that were recommended in its own study of the libraries, prior to initiating the reorganization." (PAGE 4)

The GAO also found that the EPA not only failed to follow best practices, but they also failed to follow regulations from the OMB. (PAGE 5)

Office of Management and Budget guidance recommends that agencies
conduct a benefit-cost analysis to support decisions to initiate, renew, or
expand programs or projects, and that, in conducting such an analysis,
tangible and intangible benefits and costs be identified, assessed, and
reported. However, EPA did not perform a benefit-cost analysis in this
case. According to EPA officials, OEI decided to reorganize its libraries
without completing the recommended analyses because it wanted to
reduce its fiscal year 2007 funding by $2 million to create the savings
necessary for its headquarters library and the regional office libraries per
the President’s budget proposal.

Nor were stakeholders informed of the consequences of the restructuring, and communications strategies were inconsistent and slap-dash, failing to inform affected personnel both internal and external how the proposed changes and closures would affect them and what strategies could be employed to assure that access to vital research materials remain available to scientists and the general public alike. They also failed to solicit feedback, another box on the checklist that is supposed to keep silly things like closing down libraries willy-nilly from happening in the first place.

Now, after the fact, they are reaching out to stakeholders, now that the damage is done, so to speak. But they are reaching out without an effective strategy to ensure the continuity of library services, and without having a clear idea of how the restructuring has affected the availability of library services.

The GAO also found that the EPA did not follow standard protocols (best practices) that are designed assist organizations during mergers and restructuring, but things as basic as feedback from staff were not employed, instead the restructuring seemed to be top-down and somewhat arbitrary. The EPA describes it's library plan as "phased approach" but it has no goals, timelines or evaluation mechanisms in place. The criteria offered by the EPA has been vague and the guidance and oversight has been relatively non-existent.

The GAO recommends that the EPA continue the current moratorium on further changes to the library system while the system as it exists today is fully assessed and a plan for completing the restructuring is developed and a plan for implementation in place.

The one where we crow a little bit because we beat the Washington Post to this by almost three months

Remember all those heady promises of increased airline security so something like the attacks of September 11 could never happen again?

Technology was going to save us! Technology would provide sniffer machines that would detect explosives and biometric data collection systems would be a able to detect a terrorist by his shifty eyes.

Well...Been to the airport lately? Going on seven years after September 11 and what changes have been made? Lets see - I have to take off my shoes. My shampoo, conditioner and toothpaste are treated as weapons-grade materials, and my three year old granddaughter is likely on a terrorist watch list now because of the fit she threw when they took her sippy cup.

Yet GAO investigators had no problem getting real bomb making components past various incarnations of Roscoe P. Coltrain and his deputy Enos.

(Yes, we were three months ahead of the Washington Post - they are reporting today on the findings of a GAO report we read in November.)

The sluggish pace of technological innovation and deployment has left holes in checkpoint security that could easily be exploited by terrorists, according to government officials and outside experts. Congressional investigators reported last year that they were able to smuggle bomb components through checkpoints despite new security measures. Other investigative reports questioned the government's efforts to get emerging technology into the field.

"The snail's pace of deploying new technology is unacceptable," said Rep. Bennie Thompson (D-Miss.), chairman of the House Homeland Security Committee. "We remain vulnerable because we have not kept up with technological innovation."

The TSA in coming months is expected to begin the government's first substantial investment in new checkpoint security technology since the 1970s, according to officials at the TSA, which plans to spend about $250 million on new devices, up from about $89 million last fiscal year. The machines include upgraded X-ray equipment that will provide multiple views of bags and hand-held scanners that can detect liquid explosives in bottles after they are identified by screeners.

The machines my luggage passed through was the same vintage 70's equipment that was screening luggage on September 10, 2001.

So what happened? Why haven't these wonderful technological advances materialized? Well, the government says that private investment has been anemic and the private sector says the government hasn't done it's part to foster investment.

I get frustrated with such maddening petulance. Sometimes you just suck it up and do what's right - or that's how it's supposed to be. But in America 2.0, Beta it doesn't work that way. Nowadays, the mantra is "Fuck you if I can't make a buck!"

Is anyone else just worn out with this shit? I sure as hell am. I'm so god-damned sick of fucked-up priorities and wrong-headed, selfish behavior that it's all I can do to keep from banging my head on the desk out of the sheer frustration of it all.

Can we have the grown ups back in charge please? I don't like this "Lord of the Flies" reality these juvenile nitwits have created.

We Read GAO Reports Because We Have the Time

New GAO Report on Veterans with TBI:

Brain screenings for vets may be flawed
Review of VA centers reveals problems with patient follow-up

updated 2 hours, 54 minutes ago
WASHINGTON - Thousands of Iraq war veterans who could have suffered traumatic brain injury may be getting unnecessary or inadequate health care because Veterans Affairs officials have yet to determine whether their initial screening tests are reliable, investigators say.

A draft report by the Government Accountability Office, obtained this week by The Associated Press, highlights the Bush administration's continuing difficulties in treating traumatic brain injury, a leading problem among soldiers struck by roadside bombs in the Iraq war. It also comes as a provocative military study this week found that symptoms of memory loss and irritability that have been tied to brain injury might be more accurately attributed to post-traumatic stress and depression.

The GAO review of nine VA medical centers found that months after former VA Secretary Jim Nicholson in April promoted new screenings for brain injury and pledged personal responsibility in seeing them through, the department was still struggling to determine how to best gauge the clinical accuracy of its screenings.

If you're following this story, so are we. Due to outages and outrages and adages and whatnot, we're trying to stay afloat in these Interesting Times.

Lets Talk About Port Security

Like it or not, our economy - and way of life - is largely based on imported energy products such as crude oil, liquefied natural gas (LNG), and refined products such as gasoline and jet fuel – and those products come into United States ports in tankers – about 8.5 million barrels per day. This supply chain of energy commodities is vulnerable to attack and disruption at many points, both here and abroad, as evidenced by successful attacks overseas against both ships and facilities.

In assessing the vulnerability of the supply chain, the GAO assessed three areas in a review that spanned several foreign and domestic ports. Multiple steps were taken to analyze data and opinions gathered from agencies and stakeholders, and reported to the House Committee on Energy and Commerce.

The three areas reviewed were:

1. The types of threats to tankers, and the consequences of a successful attack
2. Measures taken to protect tankers, and the challenges faced by federal agencies in making these actions effective.
3. Plans in place for responding to a successful attack and potential challenges stakeholders face in responding.

The GAO determined that the supply lines face threats from three different types of attack:

1. Suicide attack by explosives-laden boats
2. Stand-off attacks involving rockets fired from a sufficient distance to allow the attackers to evade defensive fire.
   
3. Assault by armed commandos.

The volatile and combustible nature of energy commodities mean the contents of tankers carries a potential for combustion, or, in a less likely scenario, explosion. This explosive capacity represents a significant threat to public safety. The chemical nature of the material transported by tanker represents a high risk of negative environmental impact in the event of an attack. Additionally, the disruption of the supply lines could have a severe economic impact.

The GAO determined that while many steps have been taken, both internationally and domestically, to protect tankers and facilities, many significant challenges remain. For example, in spite of international agreements that detail specific protective steps, in reality many disparities exist in their implementation. The United States is limited in the ability to increase compliance abroad, as well as in ensuring safe passage of tankers traversing vulnerable transport routes.

The global supply chain involves many players, and has three main components, each presenting it's own vulnerabilities. First, the materials are loaded in the country of origin, then it is transported across the open ocean, and ultimately unloaded at a facility in this country. Facilities where tankers are loaded overseas might be owned by private entities, governments, or combinations of the two. Foreign governments are primarily responsible for overseeing the security of energy export operations, and the vessels aboard which energy commodities are loaded are likewise owned by many different companies, some with multi-national ownership interests. Transportation routes involve crossing open, international waters, where there is no government control. Of approximately 3,550 oil tankers and 200 LNG tankers, most are registered in countries other than the United States, which means the United States has minimal oversight authority over these vessels’ crews or condition until they enter U.S. waters. Once an oil or LNG tanker arrives at it's US destination, it is unloaded at terminals that may be on the Atlantic, Pacific or Gulf coasts. LNG is currently limited to five facilities, but demand for natural gas is growing, and the number of terminals for unloading LNG is expected to increase. The Federal Energy Regulatory Commission must approve each new LNG terminal. Eleven new facilities are currently approved and dozens are pending approval.

On the domestic front, the Coast Guard, the federal agency responsible for maritime security, reports that it lacks adequate resources to meet its own self-imposed security protocols. Those protocols involve escorting ships carrying LNG. As LNG facilities are added, the workload of many units are likely to increase. The Coast Guard has not developed plans for shifting resources and spreading workload among units. According to the data obtained by the GAO, and discussions held with field unit officials, resource shortfalls were the primary reasons for not meeting these responsibilities.

Although multiple attack response plans have been established to address an attack, three main challenges are faced by the stakeholders in their implementation. Primarily, the plans for responding to a spill, versus responding to a terrorist threat are disparate processes, and ports have rarely exercised these plans in concert to see if they work effectively together. Second, ports are generally lacking in plans for dealing with economic issues, such as the prioritizing of the movement of vessels after an affected port reopens. Finally, some ports report difficulty in even acquiring response resources to carry out planned actions.

Federal grants allocated for port security have in general been geared toward preventing attacks, rather than responding to them, but a more comprehensive risk-based approach is in the planning stages.

Now comes the inevitable Catch-22. Decisions about the need for enhanced response capabilities are hindered by a lack of performance metrics tying resource needs to response effectiveness.

The supply chain of energy commodities is not only critical, it is vulnerable to disruption by terrorist attack. Ports are inherently vulnerable because they must be accessible by both land and sea, and because they are sprawling installations, frequently in close proximity to population centers. The ships themselves are vulnerable because they travel direct routes that are known in advance, and for much of the journey, they are afloat on waters that do not afford evasive maneuvers to avoid possible attack. Because there are so many links in the chain, terrorists have the luxury of examining the chain for the weakest link.

In spite of the increased security presence since the terrorist attacks of September 11, 2001, terrorists have managed to carry out several attacks on this supply chain. These attacks have included attempts to damage tankers, and to disrupt the loading operations at facilities overseas. In 2004, terrorists managed to coordinate two offshore oil terminals in Iraq where tankers were taking on oil, and in 2002, terrorists succeeded in conducting a suicide attack against the French supertanker Limburg in international waters off the coast of Yemen. (pictured)

The successful attacks overseas illustrate that tankers face several major threats, and if carried out domestically, serious consequences would likely result. Terrorists have demonstrated the ability to carry out three types of attack - suicide, stand-off, and commando raid - but overall, the suicide boat presents the greatest concern. It was a suicide boat that disabled the Limburg in October 2002. That attack killed one, injured 17, and spilled 90,000 barrels of oil.

To date, no such attacks have occurred on tankers in U.S. waters or on loading facilities in U.S. ports, but the successful attacks abroad, coupled with the expressed desire by terrorists to target U.S. economic interests, and the potential outcome of a terrorist attack on a tanker have led to the conclusion that protective efforts are warranted.

A successful attack against an energy commodity tanker, port facility or terminal carries the potential for significant public safety, environmental and economic consequences, which vary by commodity. A highly combustible commodity like LNG has the potential to burn, or (less likely) explode. An explosion at a port facility, near a population center, would pose a threat to public safety. Crude oil and heavy petroleum products remain in the environment after they are spilled, and must be removed. Spills pose the risk of significant environmental damage. The economic consequences of a major attack could be as mild as a temporary price spike, associated with apprehension about future attacks or supply disruptions with delays of shipments. While the loss of one cargo shipment would probably not have a significant price impact by itself, if an attack shut down a port for days - or even weeks - price responses and higher costs could mean losses that, when figured across the entire spectrum of effect, could run into billions of dollars.

Much is being done, both internationally and domestically, to protect the supply lines, but much more remains to be done. GAO recommends that cognizant agencies

1. plan for meeting a growing security workload for protecting liquefied natural gas shipments,
2. help ensure that ports plan for dealing with economic consequences of an attack,
3. integrate terrorism and spill response plans at the national and local level, &
4. work to develop performance measures for emergency response.

The agencies generally agreed with the GAO recommendations, but the Department of Homeland Security stopped short of endorsing them and "took the final recommendation under advisement."

GAO Blasts Department of Defense on Iraqi Police

They put out the NIE on Iran today in order to keep people from paying attention to what came out on Friday--the GAO Report on the Iraqi police forces.

The report, filed under the subject heading Operation Iraqi Freedom: DOD Assessment of Iraqi Security Forces’ Units as Independent Not Clear Because ISF Support Capabilities Are Not Fully Developed, highlights a critical fact of what is going on in Iraq. The Iraqi police can't do anything independently, but the Bush Administration by way of the Department of Defense is doing everything it can to keep you from figuring that out. And it sent General Petraeus to testify before Congress about some things that weren't, ahem, not quite true. Oh my goodness, has St. David of the General Rank of Petraeus been caught lying to Congress? Perish the thought. And by the way, that was him walking on water a little while ago.

The GAO goes on at length in their report, and I can't do it justice. I can't adequately parse all the polite doublespeak in a way that adequately expresses how outraged we should all be.

A few things stand out. The GAO says:

...the Administration’s September 14, 2007, Benchmark Assessment Report stated that although some Iraqi Army and police forces were operating independently, it also stated that the greatest constraints on independent operations were a shortage of trained leaders and an immature logistics capability, and that for the present time Coalition partnership and support remained necessary for most ISF operations.

"Independently." Remember when this was an issue? Let's get in the way-way back machine and travel all the way back to 2005:

Sep 29, 2005 - from USA Today:

WASHINGTON — The Iraqi military has only one battalion — about 500-600 soldiers — capable of fighting on its own, U.S. commanders told lawmakers Thursday.
Many Iraqi police are not being paid, and insurgents are infiltrating Iraqi police and military forces, the commanders acknowledged. Even so, Gen. George Casey, the top U.S. general in Iraq, said U.S. troops could start leaving next year if Iraqi voters back a proposed constitution and form a government.
"I do believe that the possibility for condition-based reductions of coalition forces still exists in 2006," Casey told the Senate Armed Services Committee.

[snip]

In his final appearance as chairman of the Joint Chiefs of Staff, retiring Gen. Richard Myers told McCain that he never said "things are going very well in Iraq" and that the United States is not developing a "cut-and-run strategy."
"This is a win strategy," Myers said, adding that Iraqis were making progress toward forming a government. "In a sense, things are going well."
The commanders didn't say how many qualified Iraqi troops would be necessary to allow U.S. withdrawals.
In June, the Pentagon said three of 100 Iraqi battalions were capable of acting on their own, Casey acknowledged. Thursday morning, that estimate changed to one.
After a recess, Casey said the new assessment of Iraqi readiness stemmed from a new, more demanding standard U.S. commanders use to judge Iraqi forces.

---------------------------------------------------------------

So, in just over two years, the Iraqi police are in the same shape today that they were then. In other words, they've made no progress whatsoever in any of the important areas they needed to improve. In 2005, we were told that they have tens of thousands that don't show up, that the insurgents have infiltrated the forces, that there is inadequate training and the units can't fight independently.

According to the GAO, not a damned thing has changed. I guess Generals Petraeus and Hunzeker--two individuals, who you'll recall, once were given responsibility for training the Iraqi police forces--did a bang-up job training the Iraqi police--so much so that they got promoted and were given great new jobs. If there was any accountability whatsoever in the United States Army, the only assignment these two generals would have right now is a temporary billet at Fort Living Room with a future engagement planned at Camp Golf Course.

Just a few highlights--and the intrepid Blue Girl will tell us more when time permits--

...As of July 2007, the Iraqi Army was short 18,000 corporals, 14,500 sergeants, and 7,500 sergeants first class. With MNSTC-I advice and assistance, the Iraqis are working a number of initiatives to address this leadership shortage.

...the MOI is facing the fundamental challenge of not being able to accurately account for its personnel. According to DOD’s June and September 2007 reports to Congress, there is currently no reliable data on how many Coalition-trained personnel are still serving in the MOI’s forces. Moreover, DOD has also reported that the MOI has hired a significant number of police beyond those trained by the Coalition. According to testimony by the former MNSTC-I commander, the MOI’s payroll accounts for about 60,000 to 74,000 more personnel than the number trained and equipped by the Coalition. However, he also stated that about 20 percent of this overage are “ghosts,” meaning personnel whose names appear on the MOI’s payroll but who are not actually serving.

...According to both the former and current MNSTC-I commanders, the National Police are also beset with widespread sectarianism. In June 2007, the former MNSTC-I commander testified that the Iraqi National Police was the “single most sectarian organization in Iraq.” Two months later, the current MNSTC-I commander echoed his predecessor’s assessment, stating that the National Police were “overly infiltrated with militia elements” and that “there’s no doubt that in the National Police the sectarian influence remains and will be hard to eradicate.” Finally, evidence indicates that the Iraqi Police Service is also heavily infiltrated with sectarian elements. The former commander of the Iraq Assistance Group13 characterized the Iraqi Police Service as the ISF element most vulnerable to sectarianism, despite the MOI’s removal of over 3,000 members considered to have a sectarian bias in January 2007.

...Since January 2007, the Iraqi government has replaced 70 percent of senior commanders in the National Police due to their sectarianism, a list that includes 2 division, 7 brigade, and 17 battalion commanders. These high level command changes are especially significant given that the National Police are facing a critical officer shortage; by the summer of 2007 they had filled fewer than half of their officer positions. Despite these officer changes, however, according to a July 2007 DOD report, there continues to be a sectarian bias in the appointment of senior Iraqi police commanders.

---------------------------------------------------------------

What did General Petraeus tell Congress? Well, the GAO weighs in on that, too:

For example, in its most recent report to Congress, issued in September 2007, DOD stated that 95 Army, Special Operations Combat Forces, and Iraqi Army Infrastructure units; an indeterminate number of MOD logistics enablers; 7 National Police Combat Battalions; and 3 National Police Brigade Headquarters were all “capable of planning, executing, and sustaining counterinsurgency operations independently or with Iraqi or Coalition forces.” Although in none of these reports does DOD distinguish between those forces that are capable of operating independently and those that require Coalition or Iraqi assistance, the tables in which DOD’s data are presented lead one to believe that at least one if not more than one of the units was rated as independent. This was underscored during the MNF-I commander’s September 10 and 11, 2007 testimony, during which he briefed the Congress that in every month since November 2005, with only one exception (February 2006) the Coalition has assessed at least one ISF unit as “fully independent.”

The GAO has a disturbing finding on this--

However, despite DOD’s reports and the MNF-I commander’s recent testimony that a certain number of ISF have been assessed as “fully independent,” after March 2006 it was no longer possible for a Coalition transition team member to rate the readiness of an ISF unit using these terms. Previously, in guidance provided to Coalition transition teams for use in evaluating Iraqi Security Forces, a level 1 unit was said to be “fully capable of planning, executing, and sustaining independent operations.” However, in the spring of 2006, MNC-I removed the words “fully” and “independent” from the definition. When we asked DOD officials for the reason for this change they were not able to provide us with an explanation. Therefore, according to the current guidance, a level 1 unit is one that is “capable of planning, executing, and sustaining counterinsurgency operations.” It is important to note that, according to the guidance, a Coalition transition team cannot judge an ISF unit as “independent.” However, in its most recent report to Congress, DOD asserted that an “independent unit is one that is capable of planning, executing, and sustaining counterinsurgency operations.” Thus, DOD’s continued reporting that some ISF units are “independent” or “fully independent” is not congruent with MNC-I’s instructions for filling out the Operational Readiness Assessments on which DOD’s assertions and reports seem to be based. If independence is still a relevant descriptor of ISF unit capabilities, then why was the term removed from the definition of a level 1 unit in 2006?
---------------------------------------------------------------

So did General Petraeus lie to Congress? Did he commit perjury?

My reaction to all of this is...[sigh].

Another day, another outrage. And we don't have a working press to tell all of this to the American people.

Some folks read Stephen King - I read GAO reports and get the same effect

Wanna know what scares the hell out of me?

It isn’t a few thousand bearded whack-jobs frothing with fundamentalist fervor, sporting a gigantic chip on their collective shoulder and entertaining delusions of taking over the world that are slightly less likely to be realized than the grand schemes of Pinky & the Brain.

No, what scares me is the pure, unadulterated incompetence at the highest levels of our kleptocracy.

In the last week, the GAO issued three reports on border security, terrorist screening, and aviation security that, read individually, are each cause for consternation. But read them together and synthesize the information, and you might be sorely tempted to crawl under the bed with a security blanket and a stash of Xanax until 1/20/2009.

Border Security

U.S. Customs and Border Protection (CBP) is the governmental agency responsible for keeping terrorists and other inadmissibles out of the United States. They are charged with fulfilling this mission while simultaneously facilitating the cross-border traffic of millions of international travelers every year. The CBP conducts this mission at 326 ports of entry (international airports, harbors, border crossings) throughout the United States. In Fiscal Year (FY) 2006, nearly a quarter million ineligible individuals were interdicted by CBP and turned away, but the agency estimates that several thousand more were admitted to the country through our ports of entry.

Weaknesses that compromise border security include not verifying the nationality and admissibility of individuals. This failure of the system is the most acute at land crossings. When the GAO did spot checks, they found some checkpoints entirely unmanned. (For contrast: The state of Kansas is more vigilant about their turnpikes and that five dollar fee to travel from Bonner Springs to Wichita. I have never seen a turnpike entry point completely unmanned. Have you? Didn't think so.)

The CBP has been somewhat successful in identifying certain undesirables and inadmissible aliens, but the system is compromised by the vulnerabilities that let several thousand inadmissibles slip in.

Most of the problems highlighted by the GAO can be traced to a single problem: understaffing. Staffing shortfalls directly affect the ability of the CBP to carry out the anti-terror aspect of their mission. Progress has been made in the training of new officers, but no metric exists to measure the extent to which officers on the job receive additional training and exhibit proficiency in requisite skills. Officer attrition has further impaired the ability of the CBP to maintain budgeted staffing levels, and efforts are underway to curb the loss of seasoned officers opting to retire at relatively young ages.

Terrorist Watch List Screening

In the shock and horror of the terrorist attacks of September 11, 2001 the FBI was charged with compiling a terrorist watch list to keep tabs on known terrorists and individuals who were suspected of ties to terrorism after “standards of reasonableness” were applied to nominated individuals. The FBI conducts this work through the Terrorist Screening Center (TSC), which submits records from the watch list to screening entities, such as the CPB, law enforcement agencies, etc.

In the intervening time since the watch list was initiated, it has mushroomed to include records on over three-quarters of a million individuals. The list has led to approximately 53,000 positive matches. These matches have led to arrests, denial of entry into the U.S., but most often questioning and release. In a disturbing revelation, the GAO found that some of these positive matches occurred after-the-fact. Individuals positively identified and confirmed to be inadmissible to the United States had already boarded and flown on aircraft, or even been admitted to the country, and perhaps become untraceable.

The TSC sends updates daily to the various screening agencies, but in many instances entire records are not sent, partly because screening against certain segments of the reports might not be integral to the mission of respective agencies. The resulting “cafeteria updates” are often incomplete, inadequate or even missed entirely. In other instances, software incompatibility hinders the ability of some agencies to receive adequate updates of information.

Although the GAO found that some progress has been made in the promotion of effective screening procedures, both in the federal sector and the private/critical infrastructure sector, many potentially effective screening opportunities remain untapped. This situation is perpetuated because the government lacks a current strategy and implementation protocol for optimizing the terrorist watch list.

In addition to the lack of formal protocol, clear lines of authority, accountability and responsibility are missing.

Aviation Security

If you aren't ill at ease yet, keep reading. Aviation security, it seems, is an oxymoron. The GAO conducted spot-checks of United States airports, and successfully smuggled bomb-making components and detonation devices aboard aircraft.

After the thwarted attempt in Britain to make bombs from hydrogen peroxide, the Transportation Safety Administration (TSA) made substantial modifications to the passenger screening process. Aimed at closing gaps in security that the alleged plot revealed, TSA agents set about confiscating perfumes and shampoos and sippy-cups and toothpaste from hapless travelers as they passed through security checkpoints at the airport.

After the new protocols were in place, a request was made for the GAO to test the system. To do this, the GAO attemptedc to:

1. Obtain the instructions and components needed to create devices that a terrorist might use to cause severe damage to an airplane and threaten the safety of passengers and
2. Test whether GAO investigators could pass through airport security checkpoints undetected with all the components needed to create the devices.

The investigators were able to successfully pass through screening checkpoints with bomb-making components and, on one occasion, an improvised incendiary device (IID), concealed in their carry-on luggage or on their persons. All of the component parts, as well as the items used to conceal them are commercially available.

In conducting the test, the GAO investigators used publicly available information, and determined that two types of device could be used to commit acts of terror aboard aircraft. The first was a two-component IED, comprised of a liquid explosive and a low-yield detonator. In this scenario, the detonator could be used as an explosive device in it's own right, or used to greater effect in concert with a volatile liquid. The second device was an IID that could be created by combining readily-accessible products (one of which is a liquid) that are banned from carry-on luggage. All total, the investigators spent less than $150 to purchase the components of their improvised weapons. Prior to testing the security apparatus, the components were tested for efficacy at a national lab in the summer of 2007. Prior tests had been conducted in early 2006, in conjunction with an unnamed law enforcement agency from somewhere in greater metropolitan D.C. These test clearly demonstrated that a terrorist aboard an airplane with the components in question could wreak havoc and endanger the safety of all aboard.

After the volatility of the components had been adequately established, the investigators set about devising concealment schemes, keeping in mind the prohibitions on liquids and other banned items. And two GAO investigators demonstrated the weaknesses of the security screening process in American airports by smuggling the components for multiple explosive devices and one incendiary devise through security and aboard commercial airliners, without being challenged by TSA officers.

Most of the time, the officers seemed to follow protocol and procedure, and employed technology in an appropriate manner, however, GAO was able to uncover weaknesses in the screening process and expose other vulnerabilities as a result of the exercise. Case in point: While officers generally followed the guidelines and enforced TSA policies, the investigators were able to exploit weaknesses in the TSA's own policies to get liquids through checkpoints. the investigators were able to exploit the weaknesses by studying public information and identifying the procedural weaknesses in the policies. (Details of a sensitive nature or that could otherwise be exploited by those intending to inflict harm were omitted from the report released to the public.)

GAO has submitted two briefings to the TSA in an effort to help the agency take corrective action, and suggested several actions that TSA should consider implementing in an effort to improve the passenger screening program. A system-wide review is underway, and the GAO is expected to issue a comprehensive public report, complete with recommendations for TSA early next year.

***************

As I said at the beginning of this post, any one of these reports would be cause for consternation and concern. But read them together and the picture that emerges is downright maddening. Not only are we not keeping proper tabs on terrorists and suspected terrorists, but our borders are as secure as your average sieve is watertight, and the GAO sent investigators into the field who were able to smuggle bombs-making components past TSA officers and aboard commercial aircraft.