Friday, October 19, 2007

More Corruption, Delays and Overruns in the Iraq Embassy Project

Image: McClatchy Newspapers

Even more problems with the new mega-bunker embassy in Baghdad are coming to light - and this time there is a criminal investigation into the construction contract. This criminal probe follows an investigation by Henry Waxman and the House Oversight Committee that was initiated a few weeks ago into the conduct of the IG for the State Department. Howard J. Krongard, the Inspector General for the State Department, has exhibited a persistent tendency to censor reports that might embarrass the administration, and has repeatedly thwarted investigations of the State Department and the problems with the embassy.

The problems started with the bid process.

When the State Department requested bids in 2005, exactly one came in, from J. A. Jones International of Charlotte, North Carolina. In spite of having a track record with the State Department, and having won embassy construction contracts in the past, the J.A. Jones bid was rejected because the estimated to cost was twice as much as had been allotted by State, and the company would not guarantee the June 2007 completion date. Additionally, the J.A. Jones bid was a cost-plus estimate, which frankly, is about the only way a responsible contractor would have bid the job, since the construction site was in a freakin' war zone...that was getting hotter every day. First Kuwaiti was chosen solely because it was willing to offer a fixed-price contract, in which cost overruns aren't passed on to the government.

"The only company in the end that would offer us a firm fixed-price (contract) was First Kuwaiti. The decision was made, and I believe rightly so, that firm fixed-price is the best protection for the American taxpayer. If an American company had bid a firm fixed-price, they might or they might not have won." said Patrick Kennedy, the State Department's director of management policy.

Unable to get a legitimate contractor to walk down the primrose path to potential financial ruin, the State Department Bureau of Overseas Building Operations (OBO) waived the law requiring open and competitive bidding, and awarded the contract to a firm from Kuwait, First Kuwaiti General Trading & Contracting Company. When the OBO issued the waiver, they described First Kuwaiti as "capable of completing the design and construction in accordance with the required schedule, budget and performance parameters."

That rosy assessment and vote of confidence was, to say the least, overblown. Four months after the embassy was supposed to be ready to open, it is not only not ready, but problems are still presenting. The most recent setback has been with the sprinkler system. When they tested it, the pipes burst at the junctions. In May, when electrical systems were tested they failed, and an investigation revealed that First Kuwaiti was using counterfeit wiring that fell short of the specifications.

You get what you pay for.

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Counterfeit, sub-standard building materials are one way to turn a profit on a bad bid, I guess. Another way is to abduct workers from emerging and third-world countries and spirit them off to Baghdad against their will, then underpay them to the point that they are essentially slave labor. I realize that "slavery" is a strong word, but I am not the only one using it. "It is distressing to hear that our fellow Filipinos are being deceived into working in Iraq by unscrupulous contracting firms," Senator Mar Roxas of the Philippines said, upon hearing of the abduction of Filipinos to work on the embassy. "Unless we have officially accepted that the days of slavery are back, the government must act." (emphasis mine)

According to testimony by an American who spent a short period of time working as an Emergency Medical Technician at the embassy complex, Filipino workers were given tickets that indicated they were boarding a plane to Dubai, and were not told they were going to Baghdad until the plane was airborne. When they found out, and objected, a security guard reminded them at gunpoint that they were in no position to protest. They were indeed going to Baghdad, and there was not a damned thing they could do about it. The American EMT testified before the Oversight committee that conditions at the site "were deplorable, beyond what even a working man should tolerate." Foreign workers, he said, were packed tight into trailers, equipment was insufficient and basic needs went unmet. "If a construction worker needed a new pair of shoes, he was told, 'No, do with what you have' by First Kuwaiti managers."

He also said in his testimony that workers were routinely physically and verbally abused and another witness testified about the rate of on-the-job injuries. "There were a lot of injuries out there because of the conditions these people were forced to work in. It was absurd."

As if the substandard building materials, the shoddy construction, the missed deadlines, and the abduction and forced labor of third-world workers wasn't enough, the company has also been implicated in a kickback scheme with...wait for it...Kellogg, Brown& Root.

And all that corruption and malfeasance took place with the apparent complicity of the Inspector General for State, Howard Kronegard, whose job it was to provide oversight and prevent those very offenses.


But wait! There's more!

You know how they say that it isn't the corruption that gets you busted, it's the cover-up?

That holds true here, as well.

In May, a mortar shell smashed into the complex, damaged a wall and caused what were reported as minor injuries to be sustained by people inside. The walls were supposed to be blast-resistant, but weren't.

The project manager, James L. Golden, contractor for State, attempted to alter the scene and conceal evidence of shoddy construction. According to documents and interviews, the IG for State, Krongard, reared his head once more and prevented State Department officials from investigating the incident.

When it came to the attention of Ambassador Ryan Crocker, he banished Golden from the country, yet Golden still oversees the project, as well as other projects for the OBO.

The OBO is headed up by a close personal friend of former Secretary of State Colin Powell, retired Army Maj. Gen. Charles Williams. Williams was hand-picked by his old friend and colleague to head up the OBO, and Williams apparently runs the OBO like a personal feifdom, going so far as to refused to let U.S. diplomats and congressional staffers onto the new embassy compound, according to congressional testimony given in July, and corroborated by a former senior official with first-hand knowledge of Williams and the OBO.

As recently as August, Williams assured the House Foreign Affairs Committee that the embassy would be ready for occupancy by the end of September.

"This and other incidents involving separate embassy construction projects raise concerns about the adequacy of the Department's management of our overseas building operations," committee chairman Rep. Tom Lantos, D-Cal., wrote to Deputy Secretary of State John Negroponte on October 4.

The State Department declined to make Williams available for an interview and directed questions to Patrick Kennedy, the department's director of management policy.

As of this writing, the embassy is not move-in ready, and there is no clear indication when it will be. They have, however, complicated matters further by deciding after-the-fact to move General Petraeus and his entourage into the embassy, requiring space for an additional 250 people, and an expansion of the classified areas, because, in the words of Kennedy, "Crocker and Petraeus don't want to divorce."