Foreign Aid

How the US lost billions over nine years in Iraq

from CNBC,

Since the start of the Iraq War, the United States has sent tens of billions of dollars in assistance to Iraq, a large portion of which has been squandered or simply disappeared.

Government auditors say some $61 billion was spent on reconstruction projects in Iraq from 2003 to 2012. At least 10 percent of the money cannot be accounted for. Some 15 percent of the money spent, or roughly $8 billion, was wasted. The audit also found that much of the money spent in Iraq was ineffective. Many development projects are still unfinished, and the futility of the money spent on training Iraqi troops has been on full display during the recent ISIS advance.

American money began to disappear almost as soon as the Iraq War began. In 2004, $19 billion in reconstruction assistance was provided to Iraq. From 2005 to 2009, $26 billion was sent to Iraq for the same purpose. A Congressional Research Service (CRS) report published in 2009 said much of this money was lost to waste, fraud and abuse. Stuart W. Bowen, Jr., then Special Inspector General for Iraq Reconstruction (SIGIR), testified to Congress in 2009 that 15 to 20 percent of this money was wasted. "The overuse of cost-plus contracts, high contractor overhead expenses, excessive contractor award fees, and unacceptable program and project delays all contributed to a significant waste of taxpayer dollars," Bowen told Congress back in 2009.

The U.S. began disengagement with Iraq two years before the official withdrawal in 2011. However, money has not stopped flowing to the country.

According to, $3.1 billion in foreign assistance has gone to Iraq since 2009. The peak year was 2011, when the U.S. sent $1.2 billion; the lowest year was 2014, when $48 million was sent.

SIGIR closed shop in 2013, but not before conducting one final audit of Iraq reconstruction spending. The audit found that $220.2 billion had been provided to Iraq for reconstruction and development projects and the Iraqi military – with the United States providing $61 billion (the rest came from international assistance and $146 billion through the Iraqi capital budget). The final review of how this money was spent is damning. The findings show that the United States was unable to adequately track where and how money was spent because of gaps in reporting. This led to numerous instances of missing money.

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