[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]



 
 TRANSITION IN IRAQ: IS THE STATE DEPARTMENT PREPARED TO TAKE THE LEAD?

=======================================================================



                                HEARING

                               before the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                           SEPTEMBER 23, 2010

                               __________

                           Serial No. 111-103

                               __________

Printed for the use of the Committee on Oversight and Government Reform


  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html
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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                   EDOLPHUS TOWNS, New York, Chairman
PAUL E. KANJORSKI, Pennsylvania      DARRELL E. ISSA, California
CAROLYN B. MALONEY, New York         DAN BURTON, Indiana
ELIJAH E. CUMMINGS, Maryland         JOHN L. MICA, Florida
DENNIS J. KUCINICH, Ohio             JOHN J. DUNCAN, Jr., Tennessee
JOHN F. TIERNEY, Massachusetts       MICHAEL R. TURNER, Ohio
WM. LACY CLAY, Missouri              LYNN A. WESTMORELAND, Georgia
DIANE E. WATSON, California          PATRICK T. McHENRY, North Carolina
STEPHEN F. LYNCH, Massachusetts      BRIAN P. BILBRAY, California
JIM COOPER, Tennessee                JIM JORDAN, Ohio
GERALD E. CONNOLLY, Virginia         JEFF FLAKE, Arizona
MIKE QUIGLEY, Illinois               JEFF FORTENBERRY, Nebraska
MARCY KAPTUR, Ohio                   JASON CHAFFETZ, Utah
ELEANOR HOLMES NORTON, District of   AARON SCHOCK, Illinois
    Columbia                         BLAINE LUETKEMEYER, Missouri
PATRICK J. KENNEDY, Rhode Island     ANH ``JOSEPH'' CAO, Louisiana
DANNY K. DAVIS, Illinois             BILL SHUSTER, Pennsylvania
CHRIS VAN HOLLEN, Maryland
HENRY CUELLAR, Texas
PAUL W. HODES, New Hampshire
CHRISTOPHER S. MURPHY, Connecticut
PETER WELCH, Vermont
BILL FOSTER, Illinois
JACKIE SPEIER, California
STEVE DRIEHAUS, Ohio
JUDY CHU, California

                      Ron Stroman, Staff Director
                Michael McCarthy, Deputy Staff Director
                      Carla Hultberg, Chief Clerk
                  Larry Brady, Minority Staff Director


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on September 23, 2010...............................     1
Statement of:
    Bowen, Stuart W., Jr., Special Inspector General for Iraq 
      Reconstruction.............................................    46
    Thibault, Michael J., co-chairman, Commission on Wartime 
      Contracting in Iraq and Afghanistan, accompanied by Grant 
      S. Green, Commissioner, Commission on Wartime Contracting 
      in Iraq and Afghanistan....................................    10
Letters, statements, etc., submitted for the record by:
    Bowen, Stuart W., Jr., Special Inspector General for Iraq 
      Reconstruction, prepared statement of......................    49
    Issa, Hon. Darrell E., a Representative in Congress from the 
      State of California, prepared statement of.................     8
    Thibault, Michael J., co-chairman, Commission on Wartime 
      Contracting in Iraq and Afghanistan, and Grant S. Green, 
      Commissioner, Commission on Wartime Contracting in Iraq and 
      Afghanistan, prepared statement of.........................    13
    Towns, Chairman Edolphus, a Representative in Congress from 
      the State of New York, prepared statement of...............     3


 TRANSITION IN IRAQ: IS THE STATE DEPARTMENT PREPARED TO TAKE THE LEAD?

                              ----------                              


                      THURSDAY, SEPTEMBER 23, 2010

                          House of Representatives,
              Committee on Oversight and Government Reform,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:07 a.m. in 
room 210, House Visitor Center, Hon. Edolphus Towns (chairman 
of the committee) presiding.
    Present: Representatives Towns, Maloney, Cummings, 
Kucinich, Tierney, Clay, Watson, Connolly, Quigley, Norton, 
Cuellar, Speier, Driehaus, Issa, Duncan, McHenry, and 
Luetkemeyer.
    Staff present: John Arlington, chief counsel--
investigations; Kwame Canty, senior advisor; Craig Fischer, 
professional staff member; Linda Good, deputy chief clerk; 
Katherine Graham, investigator; Carla Hultberg, chief clerk; 
Marc Johnson and Ophelia Rivas, assistant clerks; James Latoff, 
counsel; Amy Miller and Gerri Willis, special assistants; Brian 
Quinn, investigative counsel; Jenny Rosenberg, director of 
communications; Leneal Scott, IT specialist; Ron Stroman, staff 
director; Larry Brady, minority staff director; John Cuaderes, 
minority deputy staff director; Rob Borden, minority general 
counsel; Adam Fromm, minority chief clerk and Member liaison; 
Moly Boyl and Mark Marin, minority professional staff members; 
Justin Lorranco, minority press assistant and clerk; Ryan 
Little, minority legislative assistant; Ashely Callen, minority 
counsel; Tom Alexander, minority senior counsel; Jon Skladary, 
minority chief counsel; and Jennifer Safavian, minority chief 
counsel for oversight and investigations.
    Chairman Towns. The committee will come to order.
    Good morning and thank you all for being here.
    For the past 7 years, the military has led the charge in 
Iraq. In addition to providing security, the military has 
trained and equipped Iraq's security forces and has overseen 
billions of dollars of reconstruction projects. The military 
has also provided vital support to the other U.S. agencies 
operating in Iraq: food, housing, transportation, and medical 
evaluation services have all been managed or carried out by the 
Defense Department.
    All that is about to change. Under President Bush's 
agreements with the government of Iraq, U.S. military forces 
are to complete their exit from Iraq by December 31, 2011. As a 
result, we have reached a new phase in Iraq, a phase that 
places less reliance on our troops and more on our civilian 
agencies. This new phase has been called, ``Operation New 
Dawn,'' but from where I am sitting it should have been called, 
``Operation New Challenges.''
    As we reduce the number of troops in Iraq, many duties now 
performed by the military will be transferred to the State 
Department. The size and complexity of State's new role in Iraq 
is unprecedented. Numerous important issues appear to be 
unresolved. The State Department will take over many functions 
that are inherently military, for which State has little or no 
expertise.
    This raises important practical questions. Who will provide 
security for State Department employees? Who will recover 
personnel who are wounded or killed? Who will provide convoy 
security? Who will provide counter-fire in rocket artillery and 
other mortar attacks? Who will recover damaged vehicles and 
downed aircraft? Who will provide explosives disposal? Even 
basic questions of what military equipment will be transferred 
to the State Department and who will apply rules for the use of 
force have still not been settled.
    Without the State Department having the expertise or the 
staff to carry out these functions, State will be forced to 
turn to contractors to fill this gap. For example, the Wartime 
Contracting Commission estimates that State will need more than 
double the number of security contractors it currently has in 
Iraq, to as many as 7,000.
    The State Department must also grapple with how it intends 
to provide basic life support services. Despite poor past 
performance by KBR, the Army recently made the highly 
controversial decision to extend KBR's sole source contract 
under LOGCAP 3 instead of competing it under LOGCAP 4. The 
implications of this Army decision are unclear.
    With the huge increase in the number of contractors and 
contracting costs, the State Department will need to closely 
monitor these contracts. Unfortunately, providing effective 
contract oversight has not been the State Department's 
strongest suit.
    The State Department Inspector General, the Special 
Inspector General of Iraq Reconstruction, and GAO have all 
found significant weaknesses in the State Department's contract 
management in Iraq. Even the State Department's Assistant 
Secretary of Management has acknowledged a lack of contract 
experience and expertise within the agency.
    Six months ago Ambassador Patrick Kennedy wrote to the 
Defense Department outlining these issues and requesting help. 
Defense has still not fully responded. This apparent lack of 
cooperation is unacceptable.
    These issues cannot be ignored. We cannot sit on the 
sidelines and hope these problems take care of themselves. The 
risks are too high to botch the transition and we cannot turn a 
blind eye to reckless contractors. We cannot afford to lose the 
gains our service men and women have fought so hard for over 
these years.
    I look forward to hearing testimony from the Commission on 
Wartime Contracting, as well as the Special Inspector General 
for Iraq Reconstruction. Both the Commission and the IG have 
completed important work in these areas and continue to be an 
important asset to the Congress.
    [The prepared statement of Chairman Edolphus Towns 
follows:]
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    Chairman Towns. At this point I would like to yield 5 
minutes to the ranking member of the committee and say to him 
that these digs over here are just temporary. We will be moving 
back to our regular quarters after the completion.
    Mr. Issa. Mr. Chairman, on so many things we find common 
ground. We find the ability to come together and to agree. 
Today's hearing is an example, leaving these digs is not. 
[Laughter.]
    Mr. Chairman, today's hearing is important and it is 
bipartisan. Now, we use the words bipartisan, nonpartisan, all 
these other things, pretty often around here. It is pretty 
clear that the Iraq and Afghanistan wars, although supported 
for the troops, have not always been equally supported on both 
sides.
    But as we are nearly 2 years into a new administration and 
America's vital national interests have fully transitioned from 
one President and one administration to another, and persistent 
problems remain, as the Commission on Wartime Contracting 
issues its report, the Special Inspector General's reports have 
been keenly looked at by this committee, it is pretty clear 
that 7, 8 years of one President in war and 2 years of another 
President at war look a lot the same.
    We are going to hear today about a number of needs in the 
transition. These are not new needs. Certainly, this committee 
has staked out a great deal of jurisdiction over the question 
of outsourcing of inherently governmental activities. In fact, 
no committee owns more of the responsibility to get it right in 
the future than this.
    The Diplomatic Security Service is woefully understaffed. 
Now, 9 years ago when that was the case, nobody was surprised. 
First one and then another war in which diplomats in great 
numbers were deployed while we were still at war and/or in an 
occupation created a unique need. We never intended our 
diplomatic services to need attack helicopters, overhead eye in 
the sky, predator drones, and the like, but they did.
    Now, nearly a decade later and two Presidents into two 
wars, we realize that there is an ongoing elevated need for a 
level of security to be provided for our diplomats that is not 
appropriate to provide by uniformed services. It is not that 
the U.S. Army, Navy, Air Force haven't done a great job. They 
have. But they are not, in fact, the appropriate people to 
stand by a diplomat as he goes in saying, this is about peace.
    Our Marines, and I represent Camp Pendleton, have for 
virtually our entire time as a country guarded embassies. But 
as the diplomats go out, they need to go out in civilian 
clothes with, to the greatest extent possible, a peacetime 
look. This is not currently possible through Government 
employees. And the contracting system has been controversial. 
One, because it costs a great deal to employ somebody in these 
areas, and because it has been viewed as temporary, and as a 
result the high cost and the lack of a systematic approach for 
what the rules of engagement will be have caused us diplomatic 
problems time and time again. This committee has held hearings 
on many of those diplomatic problems.
    Although this committee often looks at waste, fraud, and 
abuse through the eyes of dollars, and the projected costs and 
overruns that we will discuss today are huge and need to be 
addressed, I think this committee has an obligation to bring 
light today on the fact that, after 7 years in Iraq and a 
declared mission accomplished twice, we have to make sure that 
the powers that remain remain with the assets they need and 
appropriately, when inherently governmental, use governmental 
assets.
    Over the years I have met with contractors who provide 
security services. Of course, they do it for compensation, but 
time and time again they have said, this is not our company's 
core requirement. This is not what we do. These companies very 
rightfully would give that up in a transition, and that 
transition is long overdue.
    So as we talk to two panels of learned experts, I hope that 
we will focus on what we don't have today but should have had 
several years ago, a transition that in many cases has not 
really begun, and how we go forward from here on a bipartisan 
basis.
    Mr. Chairman, I know we can do this together. I know that 
the cost overruns and the sins of the past are just that, but 
we now have it on our watch and I look forward to working 
together on this.
    I yield back.
    [The prepared statement of Hon. Darrell E. Issa follows:]
    [GRAPHIC] [TIFF OMITTED] 63138.004
    
    [GRAPHIC] [TIFF OMITTED] 63138.005
    
    Chairman Towns. I thank the gentleman for his statement. I 
look forward to working with him.
    At this time I would like to ask the witnesses to please 
stand and raise your right hands. We swear all of our witnesses 
in.
    [Witnesses sworn.]
    Chairman Towns. Let the record reflect that both witnesses 
answered in the affirmative.
    Mr. Michael Thibault is co-chair of the Commission on 
Wartime Contracting. Before being appointed to the Commission, 
Mr. Thibault spent his career in public service at the Defense 
Contracting Audit Agency. From 1994 until his retirement from 
DCAA, Mr. Thibault served as the Deputy Director for the 
Agency. Mr. Thibault is also a decorated Vietnam veteran, 
serving in the U.S. Army from 1965 to 1968.
    We welcome you this morning.
    Mr. Grant Green is one of the six Commissioners who served 
with the two chairs of the Commission on Wartime Contracting. 
Highlights from Mr. Green's career include appointment as Under 
Secretary of State for Management and Assistant Secretary of 
Defense. Mr. Green also spent 22 years in the U.S. Army and is 
currently the chairman of a business consulting firm.
    We welcome you.
    At this time I ask the witnesses to deliver their 5-minute 
testimony. I understand that you, Mr. Thibault, will be 
delivering testimony on behalf of the Commission. Let me just 
say that, even in our new digs, I understand that when you 
start out the light is on green, and then all of the sudden it 
moves to yellow, caution, which means that you have 1 minute to 
summarize from that point. And, as everywhere in the United 
States of America, red means stop. Of course, when the red 
light comes on, that means stop, which will, of course, allow 
us an opportunity to raise questions with you.
    Let me thank both of you for being here this morning. Of 
course, at this time, Mr. Thibault, you have 5 minutes to give 
your testimony.

 STATEMENT OF MICHAEL J. THIBAULT, CO-CHAIRMAN, COMMISSION ON 
  WARTIME CONTRACTING IN IRAQ AND AFGHANISTAN, ACCOMPANIED BY 
GRANT S. GREEN, COMMISSIONER, COMMISSION ON WARTIME CONTRACTING 
                    IN IRAQ AND AFGHANISTAN

    Mr. Thibault. Thank you, Chairman Towns, Ranking Member 
Issa, and other members of the committee. I am Michael 
Thibault, co-chair of the Commission on Wartime Contracting in 
Iraq and Afghanistan. Beside me is Commissioner Grant Green. 
Thank you for inviting us to testify today.
    I will briefly summarize our joint statement and request 
the full statement be entered into the record.
    Chairman Towns. Without objection, so ordered.
    Mr. Thibault. Thank you.
    First, I would like to state that my co-chair, Chris Shays, 
who has worked with me extensively, as well as with this 
committee in his past, very graciously asked Commissioner 
Green, because of the background that you recognized, that he 
sit in and provide testimony. I am not sure I could have done 
that, but he did. Commissioner Shays is, as you mentioned, 
bipartisan and absolutely in synch with our efforts today.
    Chairman Towns. We were looking forward to seeing him 
because he served on this committee for a number of years. I am 
happy to know that he didn't feel it was a conflict of 
interest.
    Mr. Issa. We had a few questions for him from his time here 
that we are still hoping to ask.
    Mr. Thibault. Thank you.
    Chairman Towns. And we wanted to show him our new digs.
    Mr. Thibault. The future of the new Iraq is unsettled. This 
past Sunday, as the Washington Post reported, six car bombings 
in Baghdad and a suicide bombing in Fallujah killed 37 people 
and wounded more than 100. Iraq remains a dangerous place. The 
combination of a military withdrawal, a persistent security 
threat, and a return to customary intra-governmental relations 
brings us to our concerns for this hearing.
    The U.S. Embassy will remain after U.S. troops withdraw 
from Iraq. These circumstances combine to create what may be a 
unique situation in American history: a diplomatic presence re-
established and expanding in a country that appears unable to 
provide normal host country security and services, while the 
U.S. military withdraws.
    The scheduled withdrawal of the U.S. military forces leaves 
State very little time to arrange for the alternative provision 
of functions. One example best highlights the many challenges 
facing the State Department. When insurgents attack U.S. bases, 
they often include rocket and other indirect fire as part of 
that attack.
    Presently, the U.S. Army has a sophisticated and highly 
effective system to provide immediate warning for these rocket 
attacks. This system is called the counter-rocket and mortar 
system. Within seconds of an enemy rocket or mortar launch, 
there is a warning for all base occupants. This system has 
saved countless lives.
    Also included is a counter-battery system where military 
indirect fire experts locate and return fire onto enemy 
insurgents. This counter-battery effort takes 6 to 8 seconds 
and is critical. As a result, enemy insurgents seldom fire more 
than one rocket, as they know they will be targeted.
    The State Department recently received an unsolicited 
contractor proposal and now has identified a commercial variant 
to replace the current system. They are presently evaluating 
how this system can be acquired.
    Even more troubling in this example, State Department 
executives informed us this week that the counter-battery 
effort will be terminated. Enemy insurgents will be delighted 
when they learn and experience that they will not be 
immediately targeted and brought under fire by the military. 
Where our enemies work very hard to launch a single rocket, 
there will be little reason to not launch entire batteries of 
rockets. There will be no military consequences for them.
    Commission concerns were recently validated by a June 21, 
2010 Capitol Hill hearing. Among the troubling testimony we 
heard that day was what you have previously mentioned, Mr. 
Chairman, the Department of State estimates that without U.S. 
military support it will need to raise its private security 
force from 2,700 to almost 7,000.
    Under Secretary of State Patrick Kennedy wrote to the 
Department of Defense almost 6 months ago to request a 
substantial amount of military information plus continued 
access to the Army's LOGCAP logistics contract and continued 
food and fuel supply through the Defense Logistics Agency, and 
we found that DOD's joint staff at that time had not forwarded 
that request with a recommendation to the Office of the 
Secretary. We have been informed informally that they have, but 
we attempted to reach confirmation on that and we were unable.
    In summary, State Department program leaders have been 
dealt a hand that includes unknown contract and program support 
from the Department of Defense, funding limitations likely to 
impact their mission capability, and the need to contract for 
and perform functions that have never been done by their 
Department. We believe that the State Department has been 
placed in an unfair position as they work to deliver on 
critical mission requirements in the continuing effort to 
stabilize and reconstruct Iraq.
    That concludes our joint statement, Mr. Chairman and 
Ranking Member Issa. We thank the committee for its attention 
and welcome your questions.
    [The prepared statement of Mr. Thibault and Mr. Green 
follows:]
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    Chairman Towns. Thank you very much for your testimony. We 
will now start the questioning period. Each Member, of course, 
will have 5 minutes. I will begin.
    Your July report highlights very significant problems with 
transition planning for the Defense Department handoff to the 
State Department. Are we facing a potential disaster at this 
point?
    Mr. Thibault. Mr. Chairman, I am not sure if I would refer 
to it as a potential disaster. We certainly are facing the 
potential for significant contract cost overruns, 
inefficiencies, and potential fraud, waste, and abuse if this 
transition occurs in the form of what might be called a pick-up 
game.
    Chairman Towns. What do we need to do to fix this problem?
    Mr. Thibault. Well, in our statement senior executive 
leadership needs to address this. Our recommendation is at the 
Secretarial level. There has been some coordination in theater 
now as a result of our concerns and concerns raised by others, 
but it is at the middle management level. This needs to be 
pushed up to the highest levels within State and Defense, 
because it is that important.
    Chairman Towns. Right. Your report lists 14 security-
related tasks currently performed by DOD that will soon be 
transferred to State. Functions such as recovering killed and 
wounded soldiers will become a State Department responsibility. 
Who will be performing these functions?
    Mr. Green. Mr. Chairman, some of those 14 functions will 
probably fall off the table. It will not be necessary to do 
them, but the majority of them will. In most cases there will 
be contractors performing those functions. There is a lot of 
coordination currently being done now between the State 
Department and the Defense Department on what equipment can be 
left behind, for example, medical support. There is a dialog 
ongoing now to see what medical support could be left behind by 
DOD to support the State Department.
    But some of these missions, for example, route clearance, 
which had heretofore been done by the Department of Defense, 
will fall principally to either contractors, and they plan on 
using UAVs to perform that mission.
    The main question and the answer is that these functions 
will essentially be done by contractors. I think that obviously 
creates difficulties. You mentioned them in your opening 
remarks, inherently governmental functions. There is great 
concern here in this Body and across America, in some cases, 
about personal security contractors, but we forget about all 
these other things that are military or quasi-military that 
will now be done by contractors.
    One of the most extreme examples that I can think of is the 
State Department has asked for MRAPS. The Defense Department 
has, at least verbally, indicated they will provide those 
vehicles. They will be driven by contractors, and if there are 
occasions when they go into high-threat areas and they have 
weapons mounted, those weapons will, as it stands right now, be 
manned by contractors.
    Chairman Towns. I am thinking about all these security 
contractors. One of the problems that we face, in terms of the 
Department, is managing all of these security contracts. I 
mean, it seems to me that you are going to probably double or 
even maybe triple the amount that is in there now.
    Mr. Thibault. Right. Mr. Chairman, the management of 
security contractors for the Department of Defense and the 
Department of State has been a challenge. There have been 
numerous instances that we have reported where they are not 
providing the kinds of quality and background investigation 
that many of the security officials or contractors should have.
    In the case of the State Department, they are going to be 
challenged with potentially tripling the size of their security 
force. It is unprecedented. They acknowledge it is 
unprecedented.
    The other item I think that is important that Commissioner 
Green brought up is many of these inherently governmental items 
that are being transitioned to State from the military 
represent items where this Commission feels that the U.S. 
military is the superior performer, and many of them relate to 
security. With no disrespect for contractors, those items that 
are inherently governmental, where professional military best 
performs it, should and could remain with the military.
    Chairman Towns. Let me be very basic. What can we do to 
make this transition work?
    Mr. Green. I think two things come to mind, and that is the 
increased, expanded, and continuing dialog and coordination 
between the State Department and the Defense Department. As 
Chairman Thibault mentioned in his opening remarks, there has 
been a dialog. It has mostly been at the middle management 
level. They have certainly progressed from the time that I was 
in-country the end of May and spent a week with the State 
Department talking about the transition. U.S. forces Iraq has 
been very forthcoming in providing liaison people and advisors 
to the Embassy, but that has to continue.
    Where I see a void is, and I go back to my time in the 
State Department when I was responsible on the State side for 
the transition from the Coalition Provisional Authority, 
Ambassador Bremmer, to the new embassy. I had a counterpart 
from the Defense Department, a retired Army lieutenant general 
that worked directly for the Secretary. He was that ``belly 
button,'' and he came over there with a gaggle of colonels and 
helped us through that process. That process was nothing 
compared to what we are facing today.
    Where I see a hole is that we don't have or I don't know of 
a person, we don't have a single person from the Defense 
Department that can run interference and make things happen.
    We mentioned the LOGCAP contract and the request for 
equipment and support for LOGCAP DLA that went to the Defense 
Department in April. As far as we know, it is still sitting 
there. We need somebody that can walk into the Deputy's office 
or even the Secretary's office and say, sir, we have to move 
this. We have to make a decision. If it is yes, great. If it is 
no, let's make a decision. Because much of the planning that 
State has to do today in-country cannot be done until they know 
the status of LOGCAP, as an example.
    Chairman Towns. OK. My time is up.
    Mr. Thibault. And, Mr. Chairman, one simple add-on to that 
is anything that this committee can do to compel the Department 
of Defense to provide support to the Department of State where 
it is needed and where they have that kind of expertise and can 
influence the criteria for providing that support is needed.
    Chairman Towns. OK.
    Mr. Green. I only answered part of your question, because 
you said, Mr. Chairman, what else can we do.
    Chairman Towns. Right.
    Mr. Green. I think the other key element here is a stable 
and reliable funding stream to State. I can tell you from my 4 
years there, budget is always a problem. Today it is more of a 
problem. We have already seen some decrements in the 
supplemental for Iraq's support to both State and Defense. I am 
concerned that when the spotlight is off this transition and it 
is forgotten about and State is doing their thing and they have 
taped this thing together. And I am confident it will happen. 
It will work. But a lot can fall through the cracks.
    We have to have stable funding when no longer is this the 
top priority after Afghanistan.
    Chairman Towns. And it seems to be a big crack.
    Mr. Green. It is a big crack.
    Mr. Thibault. That is right.
    Mr. Green. It is a big crack.
    Chairman Towns. And I yield 5 minutes to the gentleman from 
California, the ranking member of the committee.
    Mr. Issa. Thank you, Mr. Chairman. I am going to stay right 
along your line of questioning.
    Let me start off by reminding all of us on this side and 
informing you, a while back we did a good and important hearing 
that sort of was sad, and that was on how the Coast Guard 
decided it was going to create its fleet of blue water naval 
ships, if you will, and they didn't know how to do it. The end 
result is we have ships that are going to break in half sooner 
than they normally do. It boils down to less life because they 
didn't have the right designers. And they were designing a ship 
that was substantially similar to ones that were designed by 
the Navy successfully for years.
    That taught all of us something, which is that procurement 
doesn't belong just to the agency doing it; it belongs to this 
committee to find and ensure that, if the skills exist in one 
part under one stovepipe of Congress and one stovepipe of the 
administration and the need is in another, we have an 
obligation to either assist or de-conflict. I think we have 
that here today. I think we can all agree on that.
    Let me start by asking a question for the record, which is: 
does State Department have the acquisition skills, by any 
stretch of the imagination, to acquire 7,000 people and 
commensurate hard assets to do the type of security, 
protection, and missions in Iraq that we see for at least the 
next year?
    Mr. Thibault. I would answer that, Mr. Congressman Issa, 
that they do have acquisition skill sets to award contracts.
    Mr. Issa. That is not my question, though.
    Mr. Thibault. I think the contract oversight and the 
management of that is absolutely strained to the max now. They 
have been providing some additional support for contract 
oversight based on need. If you triple the force, for example, 
of private security contractors, the inference is clear: if you 
want to have boots on the ground to take a look and make sure 
that they are complying with use of force criteria, you have to 
have the people to do the oversight. That is going to be a 
challenge.
    Mr. Issa. OK, but let us break it down a little 
differently. Do they know how to buy predator aircraft, to 
figure out which one?
    Mr. Thibault. No. Not presently.
    Mr. Issa. Do they know how to buy armored vehicles?
    Mr. Thibault. They do not have experience.
    Mr. Issa. OK. They do not know how to buy anti-mortar or 
anti-missile systems?
    Mr. Thibault. They are going to have to learn how.
    Mr. Issa. Do they?
    Mr. Thibault. No. They do not have that experience.
    Mr. Issa. Mr. Green, if they don't have that experience and 
if 100 percent of the skills exist in the U.S. military, both 
for acquisition and among our uniformed men and women, and they 
have historically done a big part of the job, as distasteful as 
it is to say we are going to break with long tradition of 
having military not standing next to Ambassadors as they go in 
to heads of state and so on, aren't we just arguing over the 
uniform?
    And let me just give you a hypothetical, because it is 
beyond the jurisdiction of this committee, but not beyond our 
imagination.
    If we look at our 50,000 men and women already there and we 
segment or ask the administration to consider segmenting this 
role on a seconded basis to where they would assume those 
additional duties as they have in the past, if we do that, 
don't we save money, save trying to train, and, in the case of 
men and women in uniform who have been doing much of this job, 
save using private contractors who ultimately, as patriotic as 
they might be, are, in fact, more alien to the process of 
protecting our Diplomatic Service than the military itself is?
    Mr. Green. State would be thrilled to have that support 
and, in fact, will need it and have asked for it.
    Just go back to LOGCAP as an example. If DOD in their 
wisdom says, OK, we will support you with LOGCAP for the next 
one, two, or whatever years, and we will provide also that 
oversight and management, that mechanism that is in place today 
to oversee those contracts, they also would want, and you 
mentioned, UAVs and CRAM. They also will need help and will ask 
for help and have asked for help as they begin to develop those 
requirements.
    Mr. Issa. So, to put it short, this is a gaping hole which 
we are deeply concerned about and the time is ticking down to 
zero, and yet it is, by definition, a self-inflicted wound if 
it is not necessary to move it, but rather a decision for the 
military to shed something, for whatever reason, when, in fact, 
the most capable, most cost-effective support might, in fact, 
already exist with our military and have no justification for 
the long run for most of the rest of the world for our men and 
women in the Diplomatic Service?
    Mr. Green. Believe me, State Department knows where their 
weaknesses are and has reached out and I hope will continue to 
reach out to the Defense Department in those areas where 
Defense obviously has the expertise.
    Mr. Issa. Well, as we continue to look at it, I am going to 
close with one question. I know we are talking and your 
specific expertise is in Iraq, but we have Iraq and 
Afghanistan. We also have the Horn of Africa, and we have other 
areas around the world that are hot, can become super-hot, and 
could fit the same model. Don't we have an obligation to have 
an answer that isn't simply, go look for recently departed from 
the military personnel to bring in contractors, but rather have 
an in-sourced, in-Government group of people who can meet those 
responses which could escalate as quickly, I shouldn't say as 
they de-escalate, because they don't seem to de-escalate 
quickly, but they do escalate quickly. Isn't that true?
    Mr. Thibault. Mr. Congressman Issa, we would absolutely 
agree with that. The fact that the U.S. Army now has a core 
capability, they have more than 200 individuals on a team in 
Iraq right now doing LOGCAP, for example. There are no State 
employees doing LOGCAP. The only alternative is contractor or 
our contractor employees.
    Your reference to other theaters is spot on. There is an 
absolute need to be able to respond quickly and effectively.
    Mr. Issa. OK. Thank you, Mr. Chairman. I hope we have a 
second round. I think this is a good line of questioning, and I 
appreciate your time and yield back.
    Chairman Towns. Right.
    I now yield 5 minutes to the gentleman from Ohio, 
Congressman Kucinich.
    Mr. Kucinich. Thank you, Mr. Thibault.
    Going over your testimony which you read and didn't read 
that is in your prepared statement, and I see phrases like: no 
clear guiding policy; a pick-up game; lack of transparency, 
visibility, and basic data; transition limbo; State required to 
undertake a very large, hurried, expensive, and unprecedented 
exercise in contracting; functions falling off the table; 
diplomatic presence re-established and expanding in a country 
that appears unable to provide normal host country security and 
services.
    There is another way to caption this: fiasco. I mean, this 
is not about fault; it is a fiasco. That is what you have 
described.
    Now, I think when you hear about this discussion about 
Department of Defense and State it is like we are talking about 
two different countries here. This is within the same 
government, so what is really going on here? I think this is a 
teachable moment, Mr. Chairman.
    Let us look at the Washington Post's account yesterday, Bob 
Woodward's new book. Here's a quote. I want everyone to think 
about this. Woodward quotes General Petraeus as saying, ``You 
have to recognize also, I don't think you win this war. I think 
you keep fighting. It is a little bit like Iraq, actually.'' 
He's talking about Afghanistan, but then he says, ``Yes, there 
has been enormous progress in Iraq but there are still horrific 
attacks in Iraq. You have to stay vigilant. You have to stay 
after it. This is the kind of fight we are in for the rest of 
our lives and probably our kids' lives.''
    The Washington Post, same Washington Post article, also 
tells of a real struggle inside the administration where 
President Obama kept asking for an exit plan to go along with 
any further troop commitment and is growing increasingly 
frustrated with the military hierarchy for not providing one.
    So I think what is going on here, based on what this 
testimony is, is that the Department of Defense isn't getting 
its way. The top military commanders like Petraeus want to stay 
in Iraq, and so it is OK with them if the State Department's 
mission collapses, because then that opens the door for them to 
come in and to stay. This is so clear to see, and this 
testimony has to be put in the context of a desire of certain 
top military commanders to thwart, frustrate, delay, and 
otherwise impede an exit strategy from Iraq.
    I mean, this Woodward book is an important book that is 
coming out, but you have to look at the struggle that has been 
going on within the administration to try to end the war. They 
might be good soldiers, they might be fine individuals, but 
they should not be making the policy for the United States of 
America. That is up to the President of the United States.
    We see this report. It is a very disturbing report and 
Woodward's book. And when you hear this testimony today and you 
put it together with this emerging view of what is going on, 
there is just no question that the Department of Defense will 
do anything it can at this point to thwart the mission of the 
State Department to try to achieve a peaceful transition. Very 
clear that is what is really going on here.
    It is just so clear I am amazed, but you can't say it, Mr. 
Thibault, but you have said it in so many words or less. I have 
numerous questions to ask you, but after I read your report and 
I am thinking about what I read yesterday, Mr. Chairman, what 
we really ought to be doing is calling the Secretary of Defense 
in front of this committee and General Petraeus and get them to 
explain why they are not cooperating with the State Department. 
That is what we really need to do. The State Department has 
been given a mission impossible, given the fact that the 
Department of Defense is not cooperating. And we know why: they 
don't want to leave. Why don't they want to leave? That is a 
subject for another hearing.
    I don't have anything more to say.
    Chairman Towns. I thank the gentleman for his statement.
    I now yield 5 minutes to the gentleman from Missouri, Mr. 
Luetkemeyer.
    Mr. Luetkemeyer. Thank you, Mr. Chairman.
    The title of the hearing today is Transition in Iraq: is 
the State Department prepared to take the lead? And in your 
summary, Mr. Thibault, you list a list of concerns here: 
unknown contract and program support from DOD, funding 
limitations likely to impact mission capability, need to 
contract for and perform functions that have never been done by 
the Department, and feel the Department has been placed in an 
unfair position to be able to deliver on their mission.
    I guess my question is: you sort of prefaced in your 
summary here the reason for failure of the State Department to 
be able to lead and/or its concerns about leading, and I wish 
you would elaborate on that because I would like to know, is 
the State Department prepared to lead on this?
    Mr. Thibault. Our assessment, my assessment, is they are 
prepared to lead if they must. Their preference is to do as has 
been discussed here earlier, which is those organizations that 
can best provide support would provide them the support. That 
is the request. And the point is the request has been out there 
almost 6 months, and so they are going with a dual approach of 
planning, which doesn't make a lot of sense to us.
    Their approach is: if the Department of Defense gives us 
support, here is what we can do, but if they don't give us 
support--and they have begun solicitation planning to use 
contractors for the many items introduced in our statement and 
in our prior report simply because they may not have a choice. 
And the points that have been made here, what we are trying to 
force out is a decision and then a debate on that decision, and 
the decision just is not forthcoming.
    Mr. Luetkemeyer. OK. So you delineated the concerns and the 
problems, and obviously there is some give and take here on 
what is going on. Let me back up a little bit to a couple 
things. During your testimony you raised some questions. One of 
the things you talked about is the MRAPS are going to be 
allowed to be used by the contractors. How much equipment are 
we going to be leaving behind or reassigning to the 
contractors? Do we give up ownership of this as the United 
States, or is it going to be ours and going to be utilized by 
the contractors? How does that work?
    Mr. Thibault. Right. This would be still be government-
owned equipment. The State Department provided a page-long, 
very detailed request for various equipment items, to include 
MRAPS and aviation transport and other types of critical 
equipment. That is also part of the request that is out there 
that hasn't been forthcoming. But the government would own it.
    But I think the example of Commissioner Green, MRAPS go 
where there are security issues.
    Mr. Luetkemeyer. Right.
    Mr. Thibault. Everyone here knows that there is a gunner on 
top of an MRAP, and the gunner's job is to provide safety. And 
we can say it is defensive, but it is really offensive. It is 
to take down insurgents. That is the great example of 
government-owned equipment that is going to be operated by 
contractors unless this coordination process evolves into 
something more meaningful.
    Mr. Luetkemeyer. What do you believe the mission to be for 
the transition here over to the State Department? Do you 
believe it to be a military operation yet, or is it turned 
completely into a political operation, or is it a combination 
of both?
    Mr. Thibault. Well, I would say their mission that they 
would see is a diplomatic mission in an environment that is 
absolutely not secure. So by default, if they are providing all 
services, it has to be a combination of both.
    Mr. Luetkemeyer. OK. Well, during your testimony you also 
made a comment, something about the military was unable to 
respond to an attack under the new guidelines here, or did I 
misunderstand that?
    Mr. Thibault. No, sir.
    Mr. Luetkemeyer. OK. Can you elaborate on that just a 
little bit?
    Mr. Thibault. I am drawing a blank on the military unable. 
Oh, what I would elaborate on in my testimony was that now, 
within 6 to 8 seconds, the military puts indirect fire on top 
of insurgents who mount rockets or mortars and the like. The 
State Department has said, well, we would have difficulty 
obtaining that service from contractors, and therefore we don't 
have any plans to replace them.
    The difficulty becomes, if you are one of the bad guys and 
there is no one raining fire down on your head immediately, you 
are liable to, rather than take one rocket and run, which is 
bad enough, you are liable to take many rockets and fire them 
all off into the area. And rockets are very random and the 
potential for security risks are amplified.
    Mr. Luetkemeyer. The contractors don't have the ability to 
respond?
    Mr. Thibault. The contractors don't run indirect fire 
mortars.
    Mr. Luetkemeyer. OK. So our mission there then is it 
transitions over to the State Department, would be less 
military then?
    Mr. Thibault. It would have to be the use of contractors if 
the military was not available to do counter-battery. The only 
other option would be the Iraqi forces providing that support, 
but to date that is not considered an option.
    Mr. Luetkemeyer. OK. I see my time is up. Thank you, Mr. 
Chairman.
    Chairman Towns. I recognize the gentleman from 
Massachusetts, Congressman Tierney, for 5 minutes.
    Mr. Tierney. Thank you, Mr. Chairman. And thank you, 
gentlemen.
    When I wrote this bill that formed your Commission on 
Wartime Contracting in the House with my colleague Jim Leach, 
Republican, and then Jim Webb took it up in the Senate, it was 
our intention to give you the authority to go in and look at 
just these types of matters, and I want to thank you for doing 
that. I wish we had gotten the bill as a bipartisan bill 
through the House earlier so you could have gotten an earlier 
start.
    But the important aspect of that was, in fact, identifying 
exactly what is an inherently governmental function and then 
giving us a course of how to remedy the current situation. So I 
am assuming that your report, either an interim report or a 
final report, is going to give us a path of recommendation as 
to what are the inherently governmental functions, how we ought 
to get to the point where government does them. And then if the 
correct government agency can't do it immediately, then how are 
we going to arrange for a proper government agency to do it in 
the interim, and then have a path of training people and 
bringing people on board for the right government agency to 
eventually do those functions?
    And in the interim, if, perchance, some of it has to be 
done by contractors, and hopefully not, how they are going to 
get right management and oversight personnel and the right 
number of them in place to carry out those activities with 
insight not just into the subcontract but the sub-subcontracts. 
That kind of insight has been terribly missing, like our 
Subcommittee on National Security and Foreign Affairs cited in 
Warlord, Inc. Report, for just one example on that.
    Am I right about this expectation for your report?
    Mr. Thibault. You are absolutely correct, Congressman.
    Mr. Tierney. OK. Then I think we have here a real issue 
about funding on that, and the State has been hollowed out. I 
think you point that out very well on that. We have had a 
number of hearings in our subcommittee, as well.
    Now, Secretary Gates has indicated in the past that he 
thinks he is going to save about $100 billion in his cuts in 
Department of Defense with things that are redundant or ought 
not to be continued on. The problem as I see it is he has made 
some rhetoric in the past about thinking that the State 
Department ought to be beefed up.
    I would hope that your recommendations go to how some of 
those savings for our national security interests would be 
transferred into the Secretary of State's agency to allow us to 
have a better national security posture by beefing up the 
Secretary of State. I don't know if you are going to go there 
or not, but I would recommend that you take a look at that.
    It is all under the national security umbrella. It is not 
just a situation we have to stay in silos any more. If we are 
going to have a good national security posture, then it has to 
be one that puts the right people out front in the right places 
and it all has to be perceived as national security. It really 
shouldn't matter where the money comes from on that.
    I think, you can correct me if I am wrong, that this is 
something we can look at not just in Afghanistan and Iraq, but 
in all of the places where Mr. Issa indicated that we may be 
posturing in the future, whether it be Yemin, Somalia, Sudan, 
or whatever, is to look at the right mix of people, what is 
inherently governmental there, and how we get those personnel 
in place.
    Are you going to have time to do all of that by the time 
your report needs to be issued?
    Mr. Thibault. Well, we are challenged and we are putting 
out a report this December with our legislative proposals so 
that they can be considered, or very early January, so they can 
be considered by the Congress.
    In answer to your point, which is accurate, and 
Commissioner Green may want to amplify, if the State Department 
doesn't receive the kinds of funds that they are not receiving 
now, no matter what their capability is they are not going to 
get the job done, because they are not going to have the staff, 
the people, the resources to award and oversee contracts.
    If part of that mechanism is to utilize funds that have 
been saved in Defense or have Defense provide certain functions 
that they already do, that will greatly contribute to the 
State's objectives.
    Mr. Tierney. I would think that is basically accounting. 
If, in fact, you take the money that is saved in Department of 
Defense and it goes to Secretary of State and temporarily they 
can't do it themselves, then just subcontracting back to the 
Department of Defense. Maybe they have to work some major 
memorandum of agreement or something where the resources are at 
least put in the right place.
    Mr. Thibault. Right.
    Mr. Tierney. And then temporarily spent back on that basis 
to cover it, because I know there is a lot of maneuvering 
between the Secretaries here who is going to pay for what, what 
budget this comes out of.
    But the fact of the matter is we somehow, Mr. Chairman, 
have to transcend that and say, look, if you can save X amount 
of dollars, it ought to be in the Secretary of State's 
division, and if temporarily DOD has to fulfill it, then let 
them do a subcontract or something on that basis, but at least 
set up the mechanism where we are transitioning on a long-range 
plan, we have a plan to get where we eventually need to be. 
Because we cannot have the number of private contractors out 
there doing inherently governmental functions, because it is 
not the right message to send, because there is no check on 
liability, there is no accountability, and, frankly, it is rife 
for fraud and abuse and over-spending and inefficiency.
    It is a big challenge that you have. It is one that we put 
in the legislation for you to do. I thank you for starting off 
on that way. We will support you any way we can, I suspect.
    Thank you. I yield back, Mr. Chairman.
    Chairman Towns. Let me thank the gentleman from 
Massachusetts, and also to thank him for his work in this area. 
Of course, we still have a long way to go, but I want him to 
know he has really got us going, and I think the serious 
questions are being raised, which is why I think this hearing 
is so important.
    I now yield to the gentleman from Virginia, Congressman 
Connolly.
    Mr. Connolly. Thank you, Mr. Chairman.
    Welcome, gentlemen. If I may, let me pick up where Mr. 
Tierney just left off. I find that sometimes the definition of 
inherently governmental is deceptively simple. Let me ask you 
both, for example, is the provision of security, ongoing 
security for U.S. personnel in Iraq, an inherently governmental 
function, in your view?
    Mr. Thibault. Well, the simple answer, and I do not mean to 
be vague, is our perspective, and we have not come down 
formally on this because it is that important, is to recognize 
the different types of security, because you have convoy 
security, you have distinguished visitors security, and you 
have static or base security. There haven't been substantial 
issues or country concerns about base security. There have been 
issues about convoy security, very significant issues about the 
use of private security contractors and the like.
    Mr. Connolly. Well, your answer certainly comports with my 
own view that, again I repeat, deceptively simple. The answer 
is: it depends.
    Mr. Thibault. That is correct.
    Mr. Connolly. There are some security functions that it may 
be perfectly proper for the Government to take over. There may 
be others we want to continue to contract out for various and 
sundry reasons. It depends.
    Mr. Thibault. That is accurate.
    Mr. Connolly. Mr. Green, you would concur?
    Mr. Green. I would concur. I think the difficulty here--and 
we haven't talked much about this--is we are really in a box. 
We have until December 2011 to get all troops out of country, 
and there really is no alternative, if that is the way we are 
going. There is no alternative to contractors, whether they are 
doing inherently governmental things or they are running a mess 
hall. Until when and if that decision is modified, we are going 
to do it with contractors.
    Mr. Connolly. Let me ask on contracting, one estimate of 
the number of security folks we are going to need, the State 
Department is going to need in taking over new responsibilities 
is they probably need somewhere in the vicinity of 6,000 or 
7,000 contractors.
    Mr. Thibault. Correct.
    Mr. Green. Correct.
    Mr. Connolly. You would agree with that number?
    Mr. Green. Yes.
    Mr. Thibault. Yes, sir.
    Mr. Connolly. And how are they coming along in securing 
contracts to secure 6,000 to 7,000 private contractors for 
security?
    Mr. Green. I don't know.
    Mr. Thibault. I think I can assist with that. They have 
several solicitations that are in the works because of the 
growth, and the solicitations generally go toward existent 
companies with a proven record, contractors, because they have 
confidence in working with them, and in a very short turn-
around you tend to go with those organizations. They try to 
utilize competition, but it is not as broad a base as might be 
desirable simply because of the expedient nature of the 
mission.
    Mr. Connolly. Are we confident that there won't be any 
holes in the security apparatus because of contracting 
mechanisms, or delays in the signing of contracts and the 
execution thereof?
    Mr. Thibault. Well, the execution is interesting, because 
the way they are aligning is right now, using Iraq, it could 
fit Afghanistan I guess, but there are about 50 military bases, 
forward bases and military bases. That will go to maybe 14 or 
15, counting those that are there for the Department of Defense 
for foreign military sales.
    By necessity, what they have done is cut back their 
diplomatic capability to travel throughout the country, so one 
of the implications and outcomes----
    Mr. Connolly. They being our State Department?
    Mr. Thibault. State Department.
    Mr. Connolly. Yes.
    Mr. Thibault. They will not do the diplomatic mission to 
the extent they would like to because, even with 7,000, they 
have cut back dramatically. For example, the number of what 
they call PRTs, or the provincial teams that build diplomacy 
and build relationships and provide assistance, that has been 
totally pulled back to their four existing bases because of 
security. That is with 7,000 additional security individuals.
    If they tried to keep it the way that they had it, I have 
no idea what that number would be, but it would be 
substantially more, maybe double.
    Mr. Connolly. At least speaking for this Member, Mr. 
Thibault, what you just said is stunning.
    Thank you. I yield back, Mr. Chairman.
    Chairman Towns. I thank the gentleman for yielding back.
    I now recognize the gentleman from Illinois, Congressman 
Quigley.
    Mr. Quigley. Thank you, Mr. Chairman.
    I suppose this is as good a time as any and as good an 
issue and location as any to say that I have a hard time 
disagreeing with my colleague, the gentleman from Ohio, about 
this issue. It is extraordinarily frustrating. And we should 
care about the issue, wherever it is in the United States, the 
fundamental issue of that which makes our country safer. And 
the fact is this transition has to work, and the Department of 
Defense has to help, because we are forgetting the issue closer 
to home here.
    If I might indulge, we have heard of threats everywhere and 
would-be bombers. Well, the most recent one was in Chicago, and 
the would-be bomber placed the bomb a block from my house, so I 
can't help notice that the work that really matters first and 
foremost is taking place right here in this country. The 
success that has taken place in stopping this is good police 
work right here in this country. So you will have to forgive me 
if I am frustrated that the Department of Defense seems to have 
the mindset that staying in Iraq for a lifetime is going to 
somehow make us safer.
    This has to work. The current strategy of stalling and 
making this difficult is counterproductive and in the long run 
makes us less safe.
    But to the extent you gentlemen are willing to chime in, in 
the end, even if this transition works to the extent that you 
are talking about, do you really think the dynamics inside Iraq 
are going to be different 5 years from now or 10 years from now 
so that someone else from the outside won't have to play a big 
role?
    Mr. Green. That is certainly a question that intellectually 
I am sure all of us have thought about. It is not within our 
charter, certainly. One of the great frustrations that State 
feels and that Defense feels, the chairman has remarked to it, 
as well as Secretary Gates and folks within the State 
Department, is the unsettled nature of the Iraqi government. 
There are many, many decisions that cannot be made until there 
is a government.
    I can speculate until the cows come home when that might 
happen and the difficulties in achieving that, but the fact 
remains until that government is settled there are many, many 
decisions that cannot be made between State and the Defense 
Department.
    I don't want to leave the impression that Defense is being 
uncooperative. We talked the one issue, the LOGCAP memo, I will 
call it. We do not understand why that has taken so long, but 
in other areas there has been significant cooperation. In fact, 
I briefed General Austin about 3 days before he left here to 
take over command in Iraq, and I told him, I said, ``You know, 
if this fails it is not State failing, it is the country 
failing,'' and that is what it is.
    So we have to work together. State, Defense, USAID, and any 
other departments and agencies that have a stake in this have 
to lean forward in the foxhole and make sure it happens the way 
our country has set up for it to happen.
    Mr. Thibault. And I might add that, as part of your 
question, I think it is reflective today of the environment 
related to security as we pull out, which is in some cases 
increased, given the fact that we are at fewer locations. There 
is no indication that is going to cease when we turn simply to 
a diplomatic approach in 2011. We would all like that.
    I think everyone would like that, but there is no 
indication; therefore, the State Department, as a good steward 
of safety, contracting, and the like. If you look at the 
numbers now on their four permanent locations they are building 
out right now, and they are building it out somewhere between 
two-thirds and 75 percent of each one of those locations are 
security people. The number of diplomats in two of them, 
because they had to cut them in half because of budget, you 
can't cut the security, are 20. So you have at embassy branch 
offices or consulates 20 people doing what State Department 
would like to do, and several hundred individuals doing 
security. That is, I think, reflective of your concern.
    Mr. Quigley. I agree.
    Thank you. I yield back.
    Chairman Towns. Thank you very much.
    I now recognize the gentlewoman from California, 
Congresswoman Speier.
    Ms. Speier. Thank you, Mr. Chairman.
    Thank you, gentlemen, for your service. I am somewhat 
dumbfounded by what you have presented to us today. In some 
respects, we are just rearranging deck chairs, it would appear, 
and substituting a group of contractors to do what our military 
has been doing, and the contractors will be overseen by a State 
Department that doesn't have the oversight authority or 
capacity to do the job. Is that a fair analysis?
    Mr. Thibault. Well, I think the State Department would say 
they are working very hard to try to build that capability, but 
I think that would be a concern that they have that, because 
historically, to call it just like it is, they have been slow 
to provide the kinds of contract oversight. They have been very 
responsive, but it has been a situation where their staff 
limitations have created challenges, and to pry out four or 
five additional contracting officer representatives to do the 
kind of work they do, which is to make sure a security company 
is satisfying their contract requirements, has been a 
challenge. So it will continue to be a challenge.
    Ms. Speier. Has the State Department ever had similar 
responsibilities in any other country?
    Mr. Green. No. Not like this. I mentioned early on that I 
participated in the transition from the Coalition Provisional 
Authority to the new embassy in 2004. And obviously when the 
Soviet Union went down and the State Department created a 
number of new embassies, those were big jobs, but they have 
never in my estimation, and I think others would support this, 
they have never faced this kind of a task in such a hostile or 
I will say non-benign environment. So you are in a high-threat 
area.
    We do not know what is going to happen in December 2011 
with the insurgency. What are they going to do? We have already 
seen periodic upticks in threats. In fact, the embassy compound 
took some rockets not long ago, and I was told that one of them 
clipped the DCM's residence. So it is a high-threat environment 
complicated by the fact that they are going to have to take 
over many, many, many missions which they have no experience 
doing.
    Ms. Speier. No core competency. That is not their job.
    Mr. Green. Well, it is not their job.
    Mr. Thibault. It is not their job.
    Mr. Green. No.
    Ms. Speier. We are giving State Department a job which they 
don't have core competency in, that they don't have the 
experience or expertise, and we are telling them to go out and 
do the, and, by the way, you are going to have 6,000 or 7,000 
contractors under the auspices of the United States operating 
in country.
    Mr. Thibault. And you have to add to that, because we are 
talking security contractors. If they are left holding the 
logistical support bag, they don't have a present capability in 
theater. They have no experience. They have relied on the Army.
    Right now, because in advance of this I pulled down the 
number, there are 36,300 KBR employees that are providing 
logistical support in Iraq.
    Ms. Speier. Excuse me one moment. Let me interrupt you. I 
apologize. That is a sole source contract at KB.
    Mr. Thibault. Exactly.
    Ms. Speier. So no competitive bidding?
    Mr. Thibault. Exactly. But there are 36,300. That number 
will come down from 50 bases to maybe 14 locations. But if you 
do the math, 30 percent times 40,000, I could come up with 
another 10,000 that they would have to manage if, in fact, the 
Army doesn't provide that support. And the Army has become, 
from a management perspective, not necessarily a contracting 
but from a management perspective they are much better than 
they were, but to take it away from them and have State 
Department start all over just doesn't make sense.
    Mr. Green. And, in fairness----
    Ms. Speier. I am sorry. My time is about up. Let me just 
ask one more question.
    Mr. Green. OK.
    Ms. Speier. Is this going to cost the taxpayers of this 
country more money per----
    Mr. Thibault. Absolutely.
    Ms. Speier. How much more money?
    Mr. Thibault. It is really indeterminable, but very 
substantial amounts of money, because there is going to have to 
be some kind of a transition, especially if competition results 
in a different contractor. You might save some money in 
competition, but you are going to be introducing the need for 
the transition.
    Our position is that, starting in 2011, they should use 
LOGCAP 4. They should award a solicitation, bring competition 
in. If KBR wins it, great. If DynCorp or Fluor wins it, great. 
But there is a mechanism. But the longer we draw this out, just 
like the continuation of LOGCAP 3, the longer you draw it out, 
the more likely you are going to get a letter from the 
Department of Defense or from State saying we don't have time 
to use competition, let us extend the sole source contract. 
That is the risk.
    Mr. Green. And we had better get this right, because we are 
going to be doing it in Afghanistan in the not too distant 
future.
    Chairman Towns. Thank you very much. The gentlewoman's time 
has expired.
    I now yield 5 minutes to the gentleman from North Carolina, 
Congressman McHenry.
    Mr. McHenry. Thank you, Mr. Chairman. At this time I would 
like to yield the balance of my time to the ranking member, Mr. 
Issa.
    Mr. Issa. I thank the gentleman.
    I want to followup on something because I think it wasn't 
intended, I am sure, to be part of this hearing, but it now is.
    The gentleman from Ohio I believe implied that he needed to 
get General Petraeus and the Secretary of Defense in here, if I 
understood correctly, because the military doesn't want to 
leave and they want the State Department to fail.
    Mr. Green, you have been on both sides of this. Do you see 
any malice or any legitimacy to the thought that either DOD or 
State wants the other to fail?
    Mr. Green. No. I do not. And somebody maybe can find it, 
but I see no evidence that the military wants to stay in Iraq. 
I just served two tours in Vietnam, and I was happy to leave.
    Mr. Issa. There is a reason you count down those days, 
isn't there?
    Mr. Green. That is right. But I think that there is 
cooperation. Why LOGCAP, why this one request has been held up, 
I don't think we need to build everything, the whole 
relationship around whether that one request was held up or 
not. Yes, it is a major one, but there has been a lot of other 
cooperation at the working level between State and the 
commands, and certainly in-country. So the simple answer is no.
    Mr. Issa. Yes. And you would say no also, I am sure?
    Mr. Thibault. I would say no also. No, no. I agree with 
that statement. There is no indication at all that the U.S. 
Army wants to remain. In fact, they are pulling troops out in a 
manner which we might say pause in terms of some of the support 
requirement that the State Department needs.
    But in my mind and maybe others' minds I think there is a 
question about does the Army really want to provide the kind of 
support that State needs. That I think is the stovepipe 
situation that you have already talked about.
    Mr. Issa. And the gentleman from Massachusetts alluded to 
the question, and some of this seems to be funding fight and 
the question of nobody wanting to spend their resources unless 
they are fully funded, and so on. Let me just put it in a 
context.
    You know, we have all been to other host countries. I will 
just use Japan as a good example. In Japan we have a large 
military presence, and that large military presence, they are 
not just our host but they are our financial host. And so when 
we view our military support there, we view it as fully funded 
by the host country.
    In the case of Iraq and Afghanistan, because you are 
absolutely right, we are going down that road, should this 
committee look into that the funding should be, even if it is 
U.S. dollars, should be hosted there, so regardless of who goes 
there they must go there to get the money. In other words, if 
the Army were looking at cycling through people, or the Air 
Force or anybody else, or State, the money is there. They tap 
that money in host country. If they don't provide the support, 
if it goes to a contractor or it goes to a State Department 
employee, they use those funds. Would that movement of dollars 
to be independent of who does it allow for all the agencies to 
maybe play better in the sandbox?
    Mr. Thibault. If such a thing was remotely possible that 
they could fund it, I know in Afghanistan if you look at the 
moneys we are spending now, the country has no ability to fund 
it.
    Mr. Issa. And I am not suggesting for a moment that we 
expect that the money would come from the host country.
    Mr. Thibault. Right.
    Mr. Issa. But when it comes from the host country, the 
Army, Navy, Air Force, everybody sort of competes for, OK, can 
I get a slot in there? Is that slot meaningful? And I know I am 
going to be paid for it.
    If we move it, because we have an appropriations system, it 
is stovepipe, for the most part, by committees. But if we 
looked at Iraq and we had Iraq funding as a stand-alone and we 
made it independent of whether the Army or the State Department 
or the Department of Interior got the money initially but the 
money was there and we did an authorization for that. Now, it 
is basically still State Department money, but it wouldn't be 
State Department money in the large barrel, it would be Iraq 
funding for State activities. If we did that, wouldn't that 
eliminate some of this problem of people being reticent to pay 
for something unless they are going to get paid back because 
they see it as taking from other mission?
    Mr. Green. I think, if I understand your premise, I think 
something like that was recommended by Secretary Gates to 
Secretary Clinton, and, as I understand the proposal, and I 
don't understand it terribly well, that each would put money in 
a pot commensurate with their responsibilities to do certain 
things.
    As you know better than I, State's budget is minuscule 
compared to DOD. DOD rounds off more at the end of the year 
than State has to spend, other than in foreign assistance, 
which can't be touched for this.
    I haven't given it a lot of thought, but if there were an 
appropriation, a pot of money, and the State Department didn't 
have to contribute to that, because that is where I think they 
have a difficulty, but if there were a pot of money I think it 
would eliminate some of this back-and-forth, because, as 
someone mentioned before, you know, Gates is going to save $100 
million but he is going to let the services keep that to apply 
it to new weapons systems and personnel increases. So unless 
somebody says, no, he can't do that, that is what his plan is.
    Chairman Towns. The gentleman from North Carolina's time 
has expired.
    Mr. Issa. Mr. Chairman, I would ask that the witnesses 
expand on that in writing, and that perhaps we flesh out some 
of the possibilities together to recommend to the President.
    Chairman Towns. Without objection, so ordered.
    Mr. Issa. Thank you.
    Chairman Towns. I now recognize the gentlewoman from 
California, Congresswoman Watson.
    Ms. Watson. Thank you so much, Mr. Chairman. I am sitting 
here very, very frustrated because we got into a war that was 
not declared by Congress. The Secretary of State said if you 
break it, you own it. And there is no way, and I want this for 
the record, there is no way that we are going to win a war of a 
particular cultural and traditional quality with guns and 
bullets. Now we are discussing the State Department, whose 
mission is completely different. The mission of the State 
Department is to work on the foreign policy of our Government 
and the post we are in, the Nation we are in, diplomatically.
    So I think the responsibility, and I am saying this to the 
Commission to deliver to your members and to the President, we 
need to have the military and this committee needs to do the 
oversight, provide for the military security and the security 
of our missions as long as we are there.
    We have not won a war. We are trying to have a sovereign 
nation use a diplomatic system with their experimenting with, 
but we do not need to take on that burden through the State 
Department.
    So what I am asking is: will you recommend strongly again 
in your next report that the military take over securing with 
the number of forces that are needed as long as we are there? 
And, my friends, we are going to be there forever. It is a 
completely different part of the world with different goals and 
different ways of running their own nations. We have to 
understand that.
    So my question to you is: can we put forth a contingency 
plan for the State Department to be able to have the kind of 
security and to fulfill their mission that will be funded 
through the resources of DOD?
    Mr. Thibault. Under the current budgetary and fiscal 
guidelines, you know, you are asking can we. That is not doable 
because there is----
    Ms. Watson. What is not doable?
    Mr. Thibault. Separate streams of funds and the like. This 
committee or an organization----
    Ms. Watson. What are we asking the State Department to do? 
We are asking the State Department to take over the 
responsibilities of the military, correct?
    Mr. Thibault. In many cases that is absolutely correct.
    Ms. Watson. Yes. I ran a mission. It was a tiny mission 
over in Micronesia. We contracted out our security. We hired a 
former Marine who headed up a security company, and because of 
the size of the mission it worked. But we are in a war zone, as 
determined by the last administration, and we still have troops 
there. So can we, using that kind of line of thinking, ask the 
Department of Defense to increase the budget for securing that 
mission that we are still involved in?
    Mr. Thibault. We would support, and it is stated in our 
testimony, a requirement that the Department of Defense more 
timely and effectively sit with the State Department, go 
through those functions that they ought to be doing----
    Ms. Watson. Exactly.
    Mr. Thibault [continuing]. And that there be a requirement 
that they do those functions. From a budgetary viewpoint, the 
question then remaining is who funds it.
    Ms. Watson. OK. Let me take that off the table and ask the 
chairman of this committee if we can develop a letter stating 
just what has been mentioned, and send it to the President, 
Commander in Chief, and to DOD, and to the State Department, 
because the State Department does not have the skill sets to 
provide the kind of security. They contract it out usually. So 
the subject matter of this whole hearing is the oversight 
responsibility that we have, and I think we ought to send a 
letter saying let DOD do what it is assigned to do so the State 
Department can carry out its mission and provide the funding.
    Chairman Towns. I understand the lady's request. When we do 
hear from the second panel we will make a decision as to how we 
move from here.
    Ms. Watson. Thank you.
    Mr. Thibault. Thank you.
    Chairman Towns. The gentlewoman's time has expired.
    I now recognize the gentleman from Tennessee, Congressman 
Duncan, for 5 minutes.
    Mr. Duncan. Well, Mr. Chairman, because I was in other 
meetings I wasn't able to get here in time, and so I am going 
to yield my questioning period to Mr. Issa.
    Chairman Towns. The gentleman is recognized for 5 minutes.
    Mr. Issa. I thank the gentleman from Tennessee.
    I believe this is so important. Our staff has worked hard 
on more questions than we will ever ask, and I would ask if 
both of the gentlemen would be willing to answer some 
additional ones in writing.
    Mr. Thibault. Absolutely.
    Mr. Green. Certainly.
    Mr. Issa. They will probably be the ones less of interest 
to some people, but more of interest to the staff that, in 
detail, would like to produce a report afterwards.
    I am on leave of absence from the Foreign Affairs 
Committee, so I have to know my limitations and I have to 
remember the jurisdiction of that committee, but we have 1,600 
people in six major facilities in Iraq in the current plan 
roughly, is that right? That is the number that I have in front 
of me for the embassy and branches or consulates.
    Mr. Green. The diplomatic side?
    Mr. Issa. The diplomatic side, yes.
    Mr. Green. That is probably pretty close.
    Mr. Issa. So part of the need for a total of 7,700 people, 
or roughly 6,100 contractors if the fit doesn't hit the shan in 
the weeks after military begins pulling out, is because of the 
size of our mission, the largest mission anywhere in the world; 
is that right?
    Mr. Green. It is both the static security of the embassy 
and the four other posts, plus the personal security details 
that would be there and available to escort and protect the 
diplomatic staff.
    Mr. Issa. Now, in my time going around nation world in the 
Foreign Affairs Committee, one of the things that I observed 
regularly was that USAID typically only goes if it is safe 
enough, and in the Horn of Africa and a number of other areas 
it usually begins phasing over to the military to do AID 
projects if it is an insecure situation. Iraq has fit that. 
Afghanistan fits that. This is a place in which the military 
contributes far more to the construction projects and so on 
than the State Department.
    Am I to understand that this plan envisions USAID taking 
over construction and activities of that sort, development, and 
the democracy movement, and doing so with this size force, as 
it does not do in most other areas?
    Mr. Green. I think that certainly the AID mission when it 
comes to reconstruction and stability operations will increase 
because, to the degree that we would do SERP-like projects----
    Mr. Issa. Right.
    Mr. Green [continuing]. They won't be SERP, but AID would 
take over those to the degree they have the capability and that 
their implementing partners have the capability you are 
absolutely right. The AID staff, if there are unsecured areas, 
they don't tend to go out, but they count on their implementing 
partners.
    Very frankly, most of the implementing partners don't want 
that linkage with the Defense Department. They don't want a 
flag out there, because they believe it attracts the wrong kind 
of attention.
    Mr. Issa. Sure. I understand that. That is always 
controversial of whose sign goes up and who gets credit.
    Mr. Green. Yes.
    Mr. Issa. There is always some sheik who would prefer the 
credit over anybody else.
    Actually, I remember in the latter days of Jimmy Carter 
when we sent free wheat to Russia, to the Soviet Union, and 
they proceed to paint over anything that said United States and 
put good made in Russia on it so that their people would think 
they were being fed by themselves. I guess things never change.
    The question I have goes back to that self-inflicted wound. 
We have missions of various size, Marines and seconded military 
personnel, military attaches. Egypt, for example, has a large 
amount of our military people that work in and for the 
Ambassador. Is there any inherent reason that Iraq is 
preventing military assets from being, I use the word seconded, 
but assigned to the Ambassador for purposes of many of these 
duties? Is there anything that has absolutely been negotiated 
away so that would be impossible?
    Mr. Green. Not that I am aware of. In fact, plans are well 
underway to form the Office of Security Cooperation, and they 
are going to have several sites around the country and they 
will facilitate, through both active military and technical 
staff, facilitate sales to the country.
    Mr. Issa. So the idea that there are 50,000 troops and the 
2011 deadline is actually a not-quite-true deadline because we 
are going to have a large amount of military personnel present 
for activities other than war fighting?
    Mr. Green. Well, a large amount. Right now the number of 
military----
    Mr. Issa. Compared to Micronesia.
    Mr. Green. Micronesia? Probably.
    Mr. Thibault. There are going to be five locations for 
sure, and they are thinking an additional four to accomplish 
those duties. The military footprint between 400 and 500, but 
if someone is thinking the military is all gone, that is not 
the case.
    Mr. Issa. Thank you.
    Thank you, Mr. Chairman.
    Chairman Towns. The gentleman from Maryland is recognized 
for 5 minutes, Congressman Cummings.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    Let me ask you this. Are the Departments of Defense and 
State considering re-negotiating the Status of Forces Agreement 
to allow the military task force to provide security and re-
establish the lost functions that are critical for security and 
mission success?
    Mr. Green. I think that the ball is really in the court of 
the Iraqi government such as it is, and once that new 
government is formed and solidified they will make the decision 
whether they want to request that the Status of Forces 
Agreement be modified. As I am sure you know, there have been 
calls by various folks in the Iraqi government, the vice 
president, the head of the military, the former vice president, 
to say, hey, troops need to stay longer. But that then will be 
a decision, a recommendation that will have to be considered by 
this administration, whose current position is that troops are 
out of there by December 2011.
    Mr. Cummings. Well, that leads me to my next question. Are 
the Department of State and Defense meeting regularly to 
develop strategies and contingencies in case Iraq does not form 
a government soon?
    Mr. Thibault. Well, I think the point we try to make is at 
the middle management level, and by that I mean the 
coordination of colonels and senior State Department officials, 
is greatly improved in the last 4 or 5 months. It is somewhat 
robust. So are they developing a plan? I can't say that for 
sure, but they are discussing the alternatives that are there. 
But there is no guiding policy.
    We would say that many of the areas that we are suggesting 
remain and are inherently Governmental, that those areas would 
probably require a change in the SOFA in order to effect that 
after 2011.
    Mr. Cummings. So if a government is not formed, then what 
happens?
    Mr. Thibault. That is a problem.
    Mr. Cummings. You have to tell me more than that.
    Mr. Thibault. Well, under the current policy and Statement 
of Forces Agreement we are out of there at the end of 2011. The 
military planning is we are out of there at the end of 2011.
    Mr. Cummings. No matter what?
    Mr. Thibault. They lock step and salute when situations 
like that occur, and that may be part of this issue about them 
wanting to support the State Department. Hey, we are leaving. 
Now, we don't think that is a good idea.
    Mr. Cummings. Yes. Yes. Well, what is the Department of 
State's grand strategy for Iraq, and how do we define success?
    Mr. Thibault. Well, I think their grand strategy they would 
tell you, and I can't speak totally for them, but they gave us 
a list of about a dozen diplomatic objectives and 
responsibilities. I think there would be to build a more 
effective, safer government environment and accomplish those 
areas consistent with the United States' policy.
    Mr. Cummings. So that is the document that you are talking 
about that I guess you are looking for right now. It is OK, you 
can look while I talk. So I take it that document is the 
measuring tool; is that right?
    Mr. Thibault. Well, it certainly would be the objectives 
that are laid out there, and I thank you for giving me the 
time, but they are talking about areas. They would be 
successful if they mitigate and mediate Arab, Kurd, Suni, 
Shiian, Provincial, Baghdad tensions, so there isn't a 
sectarian war.
    Mr. Cummings. Right.
    Mr. Thibault. I am going to call it like it is. 
Strengthening the capacity of provisional, the provinces' 
institutions at key flashpoint locations, in other words, where 
there is potential unrest, strengthen government, or whatever 
is needed. Those are the criteria under which they would be 
judged, not military criteria.
    Mr. Cummings. Mr. Green, I have 32 seconds. I want to hear 
what you have to say.
    Mr. Green. Well, I can just run through a couple of the 
others here: balancing foreign interference, encouraging 
foreign investment and economic development, promoting the safe 
return and resettlement of displaced persons, providing limited 
services to American citizens, presenting American policy and 
promoting mutual understanding and respect for American values. 
That is kind of the laundry list of what they hope to achieve 
through the embassy and through these four other posts that 
they are planning to establish.
    Mr. Cummings. I see my time is up. Thank you very much.
    Mr. Green. Thank you.
    Chairman Towns. I would like to thank the gentleman from 
Maryland.
    If there are no further questions, at this time I would 
like----
    Mr. Clay. Mr. Chairman.
    Chairman Towns. I am sorry, the Congressman from Missouri, 
Mr. Clay.
    Mr. Clay. Thank you, Mr. Chairman. I will be as brief as 
possible. Let me thank both witnesses for being here. You both 
paint me a very troubling picture of Iraq's security realities 
and of the State Department's ability to handle this 
transition.
    The State Department has requested over $4 billion to fund 
its plans for a large civilian presence in Iraq during and 
after the draw-down of U.S. forces. Concerns have been raised 
that the State's budget request may not reflect the actual cost 
of its future civilian presence. Do you believe that the State 
Department is capturing the full cost of what it is going to 
take to fund this transition?
    Mr. Thibault. I think that might be two parts in that 
answer. I think they are trying to capture the cost, but what 
they are doing is they are moving costs now under a plan to the 
right. In other words, the permanent construction of these new 
sites, it is an unfair word, but they are coddling together 
available resources to build T-walls and things they are 
bringing from a distance rather than building new sites, and 
they are moving that to the right.
    There are several examples where fiscal management is 
requiring that they meet these challenges by delaying the 
application of the funds, because it is a zero sum gain and 
they don't have enough funds.
    Mr. Clay. Well, with the hiring of private contractors and 
civilian presence, are there enough safeguards to ensure that 
is transparent, that there is accountability? Mr. Green, you 
can try that.
    Mr. Green. I believe it does. I think that there has been 
so much planning that has occurred relative to security that I 
think, under the current circumstances, that the DP believes 
they have the bases covered.
    To answer your question about the $4.7 billion or $4 
billion that they requested in the 2010 supplemental and the 
2011 budget, is that enough? I don't know because it is like 
painting a moving train. As I mentioned in an earlier comment, 
until the Iraqi government is stood up and is able to make some 
of the decisions that they have to make, for example, the 
transfer of property. We can't get a final OK on the four sites 
for the consulates and the other two sites for the embassy 
offices. We can't get final approval on those until the Iraqi 
government gives a green light.
    There have been discussions. The chief of staff to the 
Prime Minister and the DCM at the embassy have had detailed 
discussions. They get a wink and a nod. But until we know that 
real estate, as an example, is there for the State Department 
we don't know all of the costs associated with it.
    Mr. Clay. This is my final question. On the issue of 
transfer of power, is DOD dragging their feet because they 
don't support the change of policy in Iraq and the hand-over to 
the State Department?
    Mr. Green. I would say no. I would say that DOD is probably 
the reverse: giving up when they shouldn't give up certain 
responsibilities that have been brought up here previously that 
they should be performing.
    So maybe it is the opposite of it, to an extent. They have 
been told to get out, and they are in a hurry to get out. I 
mean, they know the date is December 2011 and they have saluted 
and they are making plans to turn over these responsibilities 
to the State Department, move equipment out, transfer equipment 
where appropriate.
    Mr. Clay. And you are comfortable with that?
    Mr. Green. No.
    Mr. Clay. No, you are not?
    Mr. Thibault. No, we are not. No, sir.
    Mr. Clay. OK. All right. I thank you both for your 
testimony and your answers.
    Mr. Chairman, I yield back.
    Chairman Towns. Thank you very much. Let me just say to the 
gentleman from Missouri, that is why we are having this 
hearing. We want to make certain that these questions are 
answered. I want to thank you for your questions.
    Let me thank the witnesses for their work. Of course, we 
look forward to continuing our dialog. There will be some 
questions that we will submit to you in writing, hoping to get 
answers to them, as well.
    Please convey our best to Congressman Shays.
    Thank you very much.
    Mr. Thibault. We will, and thank you, sir.
    Mr. Green. Thank you, sir.
    Chairman Towns. Thank you.
    Let me just say to the Members that just before the vote 
coming up very shortly what I would like to do, there are five 
bills I think we can quickly pass, and then call up the second 
panel. Why don't we do that. If staff would make the 
transition, then we will go to the second panel immediately 
after that.
    [Recess.]
    Chairman Towns. Now we have a second panel that we would 
like to call up.
    The second panel, Mr. Stuart Bowen, Jr., has served as the 
Special Inspector General of Iraq Reconstruction since 2004, 
and before becoming the Inspector General Bowen served 
President George W. Bush at the White House in roles including 
Deputy Assistant and Deputy Staff Secretary. Mr. Bowen also 
served on Governor George Bush's staff, and as an assistant 
attorney general of Texas Mr. Bowen spent 4 years on active 
duty intelligence U.S. Air Force.
    As we do with all of our witnesses, we swear you in. Raise 
your right hand.
    [Witness sworn.]
    Chairman Towns. Let the record reflect that he answered in 
the affirmative.
    Of course, I am sure you know the rules, that you have 5 
minutes. Of course, as you know, after 4 minutes the yellow 
light comes on, and then after that minute the red light comes 
on. Of course, the yellow light means sum up, red light means 
stop, which will allow us an opportunity to raise some 
questions.
    You may begin.

 STATEMENT OF STUART W. BOWEN, JR., SPECIAL INSPECTOR GENERAL 
                    FOR IRAQ RECONSTRUCTION

    Mr. Bowen. Thank you, Chairman Towns, Ranking Member Issa, 
members of the committee, for this opportunity to appear before 
you today on the critical issue facing our country in Iraq 
right now.
    The title of the hearing captures it well: Transition in 
Iraq: Is the State Department ready to take the lead? Defining 
``ready'' is a difficult task, as we heard from the first 
panel. There are structural challenges, funding challenges, 
core competency challenges inherent in analyzing this question. 
But let me put it in context by identifying three ongoing 
evolutions in Iraq affecting our program.
    First, the U.S. effort is evolving from a large-scale 
contingency relief and reconstruction program to a more regular 
order and more regularized foreign aid package. That is not to 
say that this isn't still a huge funding initiative, a huge 
rebuilding effort still ongoing, one of the largest in the 
world today. Indeed, combining the supplemental and the fiscal 
year request, the State Department is seeking $6.3 billion to 
spend in Iraq over the next year. Significant. One of the 
largest foreign aid packages operative today.
    Second evolution is the departure of DOD down to 50,000 
this past September, down to zero active troops on the ground 
by the end of next year. It means that the security environment 
is fundamentally changing. The backdrop that DOD provided in 
movement across the country is disappearing, and as a result 
the State Department is requesting hundreds of millions, in 
fact, billions of dollars to fund continuing security. Without 
that security, doing the job of foreign assistance, foreign 
support, foreign aid will become virtually impossible.
    And the third evolution is the changing nature of U.S. aid 
in the country. As was mentioned in the earlier panels, the 
Provincial Reconstruction Teams are going away, enduring 
presence posts will replace them, from 15 PRTs down to 4 
enduring presence posts. The nature of our effort is also 
moving rapidly away from hard reconstruction. But we still 
continue to spend significant sums in the training of police 
and the training of Iraq's military.
    This work raises several concerns about the readiness 
question regarding the State Department's operations in Iraq. 
We have conducted four audits of their police training program, 
the largest contract in State Department history, $1.2 billion, 
managed by INL, not managed well. As our audits have shown, the 
need for strengthening oversight for better contract management 
for actual increased personnel, ensuring that the program goals 
are met, is essential to accomplish that critical task, 
bringing security to Iraq through its re-energized police 
forces.
    Second, our audits have raised concerns about grants and 
contracts that the State Department manages, identifying 
specifically that the contracting practices are weak, the 
grants management practices have been weak. This year we have 
issued two audits, the third one coming out shortly, on the 
management of grants by NDI and IRI through DRL, Democracy 
Human Rights Office in the State Department, and we found 
excessive costs and inefficient management or oversight of the 
goals that were sought to be achieved through that program.
    The other piece that is a huge part of the pending 
supplemental and the pending funding is providing life support 
and security. The supplement has already provided $725 million 
for security, and Secretary Lute said that is only a quarter of 
the needs, so significant additional funding necessary for 
security.
    Finally, the State Department is going to need to address 
an issue that our office has repeatedly highlighted, and that 
is the oversight of asset transfer, the transfer of projects 
completed by the United States and transferred to Iraq, and the 
sustainment of those projects. Real waste, in fact, may 
continue to occur in Iraq if those assets aren't effectively 
managed through a coordinated asset transfer program, and if 
they are not sustained.
    The truth is that over the last couple of years hundreds 
and hundreds of projects that the United States has funded and 
built have been transferred unilaterally to the government of 
Iraq. That is no way to run a rebuilding program.
    Ultimately I think that the considerations that we 
recommend in our report, which echo those that I sent in a 
letter a year ago to the Ambassador and the commanding general 
in Iraq, need to be applied to the continuing State Department 
program; namely, strengthening contract, program, and grant 
management controls, and continuing to invest or resource the 
State Department's capacity to carry out those missions.
    It is a fact that their overall contract effort has been 
identified as weak by the State Department IG, by the GAO, and 
by our reports. I think it is time for reform in that area, but 
there is a larger reform. Let me close with that point that I 
think was expressed by the first panel and I think is evident 
as a lesson learned, the hardest lesson learned from Iraq and, 
frankly, from Afghanistan, and that is the lack of an 
integrated system for managing contingency relief and 
reconstruction operations overseas.
    This is not a new issue. We experienced it in the Balkans, 
Panama, Somalia, but Afghanistan and Iraq are the biggest ever 
in history, of course. Combined, over $100 billion spent. 
Combined, tens of billions wasted. That is not acceptable, 
notwithstanding the security challenges in both countries. And 
the path to reform, one of the mandates of this committee, 
Oversight and Government Reform, is reforming the U.S. approach 
to structuring, executing, and being held accountable for 
contingency relief and reconstruction operations.
    Mr. Chairman, thank you for the opportunity to appear. I 
look forward to your questions.
    [The prepared statement of Mr. Bowen follows:]
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    Chairman Towns. Thank you very much, Mr. Bowen.
    Let me just announce before I start my questioning that the 
business meeting will reconvene at 2 p.m., so staff, make 
certain that the Members are aware of the fact that we will 
have the final meeting at 2 p.m.
    Thank you very much, Mr. Bowen, for your statement.
    Where do you see the major areas of fraud, waste, and 
abuse? Where do you see these?
    Mr. Bowen. Well, we have identified egregious examples of 
fraud through the course of our work over the last 6 years, 34 
convictions to date, 50-plus indictments. The latest phase of 
our work has involved a forensic review of all the money that 
is being used in Iraq, using a variety of electronic tools. I 
can't go into the details, but I can tell you that because of 
the excessive emphasis and use of cash on the ground to pay 
contractors, which still occurs in Iraq, especially through the 
Commander's Emergency Response Program, there has been those 
that have taken advantage of that situation and stolen the 
money through various means. We are catching some of them, 
holding them accountable, and the DOJ is prosecuting them.
    On the waste front, much more significant problem. We have 
estimated $5 billion that has been wasted in the overall Iraq 
reconstruction enterprise. That is symptomatic of a variety of 
factors. One, the security challenges that force delays in 
projects and programs; two, the changing policies that changed 
emphases in those projects and programs; three, the use of 
inappropriate contracting vehicles at the outset, namely very, 
very large cost-plus programs that paid for failure, frankly, 
for too long until we moved away from cost-plus to fixed price 
contracts, partly through our lessons learned report and our 
identification of that unwise contracting vehicle.
    Chairman Towns. Could you go into detail in terms of some 
of the things you found, specific kinds of things that you 
found?
    Mr. Bowen. Sure. The prison 60 miles north of Baghdad, $40 
million U.S. taxpayer money spent, will never hold a prisoner. 
It is less than half built. The subcontractor was not properly 
overseen, repeatedly failed in accomplishing goals set, and 
finally the contract was terminated with the prime contractor 
and finally all the subcontracts were terminated because it was 
a failure.
    This is emblematic, or perhaps the poster child of poor 
planning in Iraq, in that the Deputy Minister of Justice told 
us when we interviewed him on this inspection that the Iraqis 
never wanted that prison up in Diyala Province anyway and it 
should never have been started.
    So a failure in planning, a failure in contract management, 
a failure in program oversight, and ultimately $40 million 
wasted.
    Chairman Towns. Right. What do we need to do to fix some of 
these problems?
    Mr. Bowen. Well, I think first and foremost is developing a 
system within our government that is capable, has that core 
competency for executing contingency relief and reconstruction 
operations. We heard from the first panel that these matters 
are diffused among a number of agencies, most pointedly 
Department of Defense and Department of State. We heard about 
silos mentioned. People are operating in silos.
    Departmental lines, departmental funding differentials, 
weak core competencies that aren't suited to the missions that 
we are asking those departments to execute, indeed, the very 
question of today's hearing, is the State Department ready, 
implies a competency question, because it is happening, as Mr. 
Thibault articulated, but are they capable. As Ambassador 
Watson pointed out, this addresses a core competency issue 
within the State Department. State Department, as the 
Ambassador identified, is in the mission of diplomacy, not 
relief and reconstruction operations. This is a new 
development.
    The DOD has also expanded its capacity over the last 5 
years. It is my view, and we articulated it in a report of this 
past January or February, that the United States needs to 
develop an integrated entity that brings together the 
capacities at State, Defense, AID, Treasury, AG, Justice, all 
who play a role in these operations, into something called the 
U.S. Office for Contingency Operations that actually is in 
charge of relief and reconstruction operations.
    There is no focused responsibility, and thus you don't have 
people to call and hold accountable here at this table for 
outcomes in the contingency operations in Afghanistan and Iraq. 
There is no one person involved.
    The Commission identified that when it called 
representatives from DOD, State, and AID and said, who is 
running the reconstruction program in Afghanistan, and they 
were not able to get a clear answer. It is frustrating for 
them, frustrating for you all, I know, and frustrating for the 
taxpayer, most significantly, in that it results in waste.
    Chairman Towns. What more do we need to do, I am talking 
about now Members of Congress, to make certain that this waste, 
fraud, and abuse and stupidity is eliminated?
    Mr. Bowen. Well, I think there is the larger reform issue 
that is still hanging out there and needs to be addressed, 
something that achieves integration in planning and execution, 
and that is an important long-term solution that could make a 
difference in Afghanistan today. We are going up to $70 billion 
in Afghanistan next year, the largest contingency operation in 
history.
    But I think in the short term in Iraq, which is what this 
hearing is about, I think bringing to the table not so much the 
secretaries but the managers, the chief financial officers, the 
Director of Acquisition Management, State Department, the 
Director of Diplomatic Security, I mean, $725 million has 
already been approved by the Congress for security in Iraq. I 
think it is an important question, how is that going to be 
managed? They will have 7,000 new contractors. You have raised 
concerns in your first panel about whether they have capacity 
to manage that. Well, those are tough questions to ask those 
who are going to manage that money.
    The second question is we have identified largest contract 
in State Department history, most important continuing issue, 
police training in Iraq. Largest single chunk of funding that 
they are going to be spending over the next year. Are there 
enough in-country contracting officers on the ground to oversee 
the execution of that program? Our audits speak for themselves. 
The answer in the past has been no. The Director of INL in-
country assured me that there would be. I think it is a fair 
question for you to ask is there.
    Chairman Towns. I yield to the gentleman from California 
for 5 minutes.
    Mr. Issa. Thank you, Mr. Chairman.
    Mr. Bowen, I want to thank you for your service, for your 
many trips to a very dangerous place in the world, and for your 
diligence in bringing one after another failures to our 
attention. I also want to thank you for the many times you have 
brought some potential sanity and solutions to the process.
    I would like to dwell into sort of mixing that first panel 
and the problems that we focused on, mostly the transition and 
the absence of certain expertise at State, and your concerns 
today.
    Some years ago, before my time. Goldwater Nichols was 
passed, but I was a soldier before and I have seen the military 
after. The military today plays better in the sandbox. They 
have officers who have gone to each other's war colleges and 
senior staff officers. They have had assignments in each 
other's back yards whenever possible. As a result, my 
observation has been if we have to do joint activities we have 
people who have comfort and experience in doing that.
    Would you say, from your time of watching State and DOD and 
the various people contracted to do various functions in Iraq, 
that we need to look at exactly that? We need to look at 
building up an interoperable culture between different agencies 
and in situations like Iraq and Afghanistan have to work 
together?
    Mr. Bowen. Absolutely. As a matter of fact, the reform 
proposal that I have discussed we termed ``Beyond Goldwater 
Nichols.'' This is a civilian version of it. It is a rough 
analogy, but it seeks the same outcome, jointness, because 
integration, not coordination--there are coordinative meetings 
all the time in Iraq, but coordination lasts usually as long as 
the meeting does.
    You go out, you go down the hall, you go out into the 
field, it is difficult to operate on agreements. You need to 
have it trained. You need to have it authorized. You need to 
have it appropriated and overseen--in other words, driven by 
this Congress shaping an administration structure that can 
achieve our national security goals. This is about protecting 
our national security interests in a very unique setting, 
something new that is not Defense, not development, not 
diplomacy. The Fourth D is what we call it.
    Mr. Issa. Earlier on in the first panel--and the chairwoman 
here brought it up as a former Ambassador--we sort of begged 
those questions of do we need a new entity with direct 
authority, do we need direct funding, do we need to make sure 
that what is asked for is then delegated or assigned to the 
most efficient source, not simply each one trying to get the 
money but not spend it to do the job because that is inherent 
when you have other issues.
    Would you comment on how you view us doing that, recognized 
Iraq is, to a certain extent, yesterday's story, but 
Afghanistan is still today's story, and likely tomorrow's.
    Mr. Bowen. You began to address that with Mr. Green about 
the joint funding mechanism that Secretary Clinton and 
Secretary Gates are coming to agreement upon. Secretary Gates 
proposed it last December. It is a dual key approval process, 
and it is a step in the right direction toward this integration 
in management, in execution, but it is only funding and funding 
is only a piece of it. You just can't pour more money into the 
State Department or into the coordinator for reconstruction and 
stabilization or into the security pool, it is really a funding 
pool, and expect it to get executed and integrated.
    The other pieces of the puzzle have to be put in place to 
ensure that you get the performance you expect. Funding is a 
good step. It is what the United Kingdom has done through their 
conflict pools, but they have also taken steps further that 
have sought to bring personnel, IT, contracting, oversight, 
planning into one executory system, which is what we are 
proposing, so that there is accountability, there is 
responsibility, so that planning is done ahead of time.
    Mr. Issa. When you envision this within the U.S. system, 
the Ambassador in Baghdad is Presidentially nominated, Senate 
confirmed. The commander on the ground is Presidentially 
selected, Senate confirmed. Do you envision that in these 
situations, special but not unique, as we see them appear 
around the world, that we should consider having positions in 
which funding coming from multiple agencies goes to a 
designated person, whether it is directly appointed by the 
President or agreed on by the Cabinet officers, who then goes 
for confirmation and controls those funds and personnel based 
on, if you will, a congressional mandate?
    Mr. Bowen. Yes. That is exactly what we proposed in our 
latest report, that there ought to be someone who has been 
confirmed by the Congress, who is responsible for specific 
funds appropriated by the Congress for a specific mission, the 
contingency relief and reconstruction of Iraq, Afghanistan, or 
wherever, and that creates within our system, and that is how 
accountability happens.
    You are able to identify clearly through authorization who 
is responsible, through appropriations responsible for what, 
and ultimately through oversight did you do it. That is a 
system that doesn't work well in this unique, relatively modern 
evolution in protecting our national security interests abroad.
    Instead, we have a massive expansion of coin and 
stabilization opposite the Department of Defense filling a 
space, as General Petraeus has said, that wasn't being filled. 
And then you have the creation of new personnel centers over at 
State Department, SCRS, but not with program funds or with 
authorized missions that enable them to get out and execute 
that program or enough authority to operate in interagency 
fashion.
    Mr. Issa. I thank the gentleman and thank the gentlelady 
and yield back.
    Ms. Watson [presiding]. OK. Ms. Norton, you have 5 minutes.
    Ms. Norton. I thank you very much, Mr. Bower. What you had 
to say was, particularly after the last panel, disturbing but 
perhaps expected.
    Besides the State Department, how is the consultation that 
you describe, with no central entity responsible, how is that 
consultation happening? Surely as they get together they 
understand that somebody has to be responsible for being in 
touch with the others, or are they all operating separately and 
independently? These various agencies, I think you have named 
them, are they operating independently without coordination, 
without consultation?
    Mr. Bowen. There is a NSC directive, the interagency 
management system, adopted in 2007 that created the integration 
planning cell. That does bring representatives from State and 
AID and other civilian entities together under the NSC's aegis 
to plan. However, the actual operations are less integrated, 
are less coordinated, and as a result less effective on the 
ground.
    Ms. Norton. They are operating now?
    Mr. Bowen. Yes.
    Ms. Norton. But the State Department isn't in charge now? I 
mean, you know, the Defense Department is still there and on 
the ground. Is the State Department considered the lead or the 
Armed Forces? Are they really giving the direction at this 
point?
    Mr. Bowen. Well, it is trifurcated, frankly, the oversight, 
and we are still operating under a Presidential directive, NSPD 
36, which put the State Department in charge of overseeing 
civilians who are participating in the reconstruction program 
but left it to the Defense Department to manage police training 
and training of the Army.
    The program has evolved beyond the framework and the ad hoc 
measures put in place back in 2004, but there is no governing 
law, so to speak, which is what I am proposing, that to provide 
clarity through specific authorization that identifies those 
duties outside the context of a particular situation, and it 
thus allows appropriations to be effectively executed and 
someone to be held accountable, ultimately, for their outcomes. 
That system is not current in place.
    Ms. Norton. Now, you believe this has to be statutory 
authority?
    Mr. Bowen. Yes, for it to endure and not be an ad hoc 
solution.
    Ms. Norton. Have you seen any indication that the 
administration agrees that there needs to be statutory 
authority?
    Mr. Bowen. They agreed with our identification of the 
problems that I have been articulating, but they have not 
endorsed the statutory solution.
    Ms. Norton. Thank you very much.
    Ms. Watson. Thank you.
    We appreciate your being here today. There are many more 
questions we would like to ask, but there is a vote on the 
floor. Since Members are leaving to take part in the vote, we 
are going now to say that, without objection, the record shall 
be left open for 7 days so that Members may submit their 
questions for the record, and so there might be questions 
coming to you for written response.
    We certainly appreciate you being here.
    Mr. Bowen. Thank you.
    Ms. Watson. So without objection I will enter the binder of 
the hearing documents into the committee record and the 
committee shall now stand adjourned.
    Thank you so much.
    Mr. Bowen. Thank you.
    [Whereupon, at 12:35 p.m., the committee was adjourned.]
    [Additional information submitted for the hearing record 
follows:]
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