Why are the gods so determined to strike Condi when she’s down?

Even while the whole damn Statewater mess was in full bloom, we had the grudging admission — after months of dissembling and flat-out lying — that the Baghdad embassy project is way behind schedule, and is going to cost $144 million more than budgeted, and is still being hopelessly mismanaged. That’s on top of the slave labor allegations that are still unresolved. Unresolved partly because the State Dept. Inspector General, Howard J. Krongard, has been acting to impede, derail, whitewash or otherwise stonewall any and all investigations whose results might prove embarrassing to Condi’s State. Dept.

And now we learn of one more big boondoggle on Condi’s watch:

A $1.2bn (£590m) contract for training Iraqi police was so badly managed that auditors do not know how the money was spent, the US state department says.

The programme was run by a private US company, DynCorp. It insists there has been no intentional fraud.

Auditors have stopped trying to audit the programme because all the documents are in disarray and the government is trying to retrieve some of the money.
[...]
The US government audit, due to be released in Washington, says the state department cannot say “specifically what it received” for most of the money paid to DynCorp, the largest single contractor to the department.

DynCorp had won a contract to provide housing, food, weapons and specialist training for Iraq’s police force in February 2004.

But some of its spending included the acquisition of a $1.8m X-ray scanner that was never used, and the $4m purchase of 20 VIP trailers and an Olympic-size swimming pool with money intended to fund an Iraqi police compound.

Stuart Bowen Jr, the Special Inspector General for Iraq Reconstruction (SIGIR), blamed the problems on long-standing contract administration problems within the state department office that awarded the contract.
[...]
DynCorp had been asked to improve its management of government-owned equipment in Iraq twice before.

The State Dept. is unhappy about how this story is being portrayed, and has moved to set the record straight:

The State Department admits that it was unable to reconcile the books for the entire period of February 2004 to October 2006 but says since then it has made tremendous improvements. A spokesperson disputes that “most” of the $1.2 billion was not accounted for and suggests it should be “some” rather than “most.”

And the State Dept. seems to have presented this as good news, but everyone may not see it that way:

… the State Department says it has renegotiated some old invoices with DynCorp, and the company has dropped its price by about $116 million.

That’s already 10% of the contract’s value. And presumably everybody’s just getting warmed up here. How much did DynCorp rip off if they gave back $116 million with barely a murmur?

If you’re like me, you were probably struck by the use of the word “renegotiated” there. Why on earth would we be renegotiating invoices, instead of auditing them, identifying the actual overpayment, and then recovering that money with a suitably punitive penalty?

Stuart Bowen, the special inspector general, said at first the State Department had only two officials to administer the massive contract. He said the department wasn’t equipped to handle it. “They bit off more than they could chew,” Bowen said in an interview.
[...]
Bowen’s auditors said the environment was “ripe for waste and fraud.”
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… with invoices paid without being checked, and with no one tracking what they were for, auditors say it’s impossible to determine what money was spent on.
[...]
In a letter responding to the audit, the Acting Assistant Secretary of the State Department’s INL wrote that it “will take three to five years” to “fully review and validate invoices” for pre-October 2006 work.

No checks, no balances. No supporting documents, no audit trail. DynCorp treated this contract as an ATM card, issued on an account with a $1.2 billion balance, and no daily limit on withdrawals. If you’re a contractor in Iraq, it doesn’t get any sweeter than that.

The sweetest part, of course, is that even when you get caught, there’s no punitive action. You agree to give back part of what you stole, everybody shakes hands for the camera (the hugs and kisses, and worse, happen off-camera), and it’s still business as usual. The contracts still flow. And there’s still no real oversight. Because there are still too few people on the ground, and too few of them know what they’re doing.

And so, despite everything, Dyncorp retains its Most Favored Bedfellow status. Despite everything, it stands poised to handsomely benefit from Blackwater’s expulsion from Iraq. That’s probably fitting in a world where, despite everything, Bush is still President, and Condi still presides over the State Dept.