[Congressional Record Volume 151, Number 94 (Wednesday, July 13, 2005)]
[Senate]
[Pages S8210-S8211]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


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                              U.N. REFORM

  Mr. COLEMAN. Mr. President, I rise today to discuss Coleman-Lugar 
bill that will effect meaningful and reasonable reform of the United 
Nations. But before I delve into the issues of U.N. reform, I must take 
a moment to thank my colleague Senator Lugar for his leadership. As the 
chairman of the Senate Foreign Relations Committee, Senator Lugar has 
been at the forefront of these issues for years--working to pass 
bipartisan, consensus legislation touching a wide range of 
international matters. In short, Senator Lugar's leadership on the 
issue of U.N. reform has been crucial.
  Sixteen months ago, as the chairman of the Permanent Subcommittee on 
Investigations, I initiated a bipartisan, comprehensive investigation 
into the massive international fraud that flourished under the United 
Nations Oil for Food Program. You will recall this program was created 
to help protect the poor of Iraq from the impact of international 
sanctions. Unfortunately, Saddam Hussein manipulated the program--
siphoning off billions of dollars in under-the-table payments--and used 
that money to strengthen his murderous regime at home and reward 
friends abroad. As Secretary of State Condoleezza Rice testified at her 
confirmation hearing, Saddam Hussein was ``playing the international 
community like a violin.'' It could not have been more wrong: evil 
prospered while the poor starved; the program designed to control and 
oust the oppressor actually helped him stay in power and bolster his 
arsenal.
  Over the course of our 16-month investigation, the subcommittee has 
held three hearings and released three reports on the oil-for-food 
scandal. At those hearings and in our reports, we exposed how Saddam 
abused the program--we documented how the Hussein regime rewarded 
political allies by granting lucrative oil allocations to foreign 
officials, such as Russian politician Vladimir Zhirinovsky and the 
Russian Presidential Council; we presented evidence of how Saddam made 
money on the oil deals by demanding under-the-table surcharge payments, 
and how he generated illegal kickbacks on humanitarian contracts.
  All of Saddam's abuses occurred under the supposedly vigilant eye of 
the U.N. How could that happen? Well, over the course of our 
investigation, an avalanche of evidence has emerged demonstrating that 
the U.N. terribly mismanaged the Oil for Food Program. That evidence 
revealed mismanagement ranging from outright corruption to sloppy 
administration. For instance:
  Our subcommittee uncovered evidence that Kofi Annan's handpicked 
executive director of the Oil for Food Program, a man named Benon 
Sevan, appears to have received lucrative oil allocations from Saddam.
  Our subcommittee discovered evidence that a U.N. oil inspector 
received a large bribe to help Saddam cheat on two oil deals.
  Fifty-eight reports written by the U.N.'s own internal auditors 
revealed rampant mismanagement by the U.N., describing a program rife 
with sloppy stewardship and riddled with ``overcharges,'' ``double 
charge[s]'' and other ``unjustified'' waste of more than $100 million.
  The U.N.'s investigators, headed by Paul Volcker, determined that the 
U.N.'s process for awarding three multimillion-dollar contracts in the 
program was ``tainted.''
  The U.N.'s investigators also found that Kofi Annan failed to 
adequately investigate or remedy a serious conflict of interest--
namely, that the U.N. had awarded a massive contract to the company 
that employed Annan's son.
  Perhaps most disturbing, however, was that Kofi Annan's chief of 
staff ordered the destruction of 3 years' worth of documents. That 
order was given the day after the U.N. decided to investigate the Oil 
for Food Program.
  Such gross mismanagement and corruption in the Oil for Food Program

[[Page S8211]]

raise serious questions about the U.N.'s ability to administer crucial 
programs in the future. American taxpayers pay roughly 22 percent of 
the U.N.'s operating costs. They need assurances that their tax dollars 
are well spent. This is especially true in light of the fact that the 
U.N. is playing an increasingly larger role in world affairs.
  As a result, we must bring about meaningful and reasonable reform of 
the U.N. Such reforms must include three elements. First is the concept 
of ``transparency.'' As Supreme Court Justice Brandeis famously stated, 
``Sunlight is the most powerful of all disinfectants.'' Today, the 
U.N.'s operations are shrouded in mystery--not a single ray of sunlight 
disinfects the internal machinations of the U.N. The U.N. should be 
transparent to its member states, and use those rays of sunlight to 
prevent another episode of massive mismanagement.
  Another necessary element for U.N. reform is ``accountability.'' 
Specifically, U.N. officials responsible for the operation and 
management of programs, such as sanctions regimes and humanitarian 
efforts, must be held accountable for their performance. Such 
accountability should apply to all U.N. officials from the highest to 
the lowest.
  The third element necessary for U.N. reform is effective internal 
oversight. Simply put, the U.N.'s internal auditor--the Office of 
Internal Oversight Services, OIOS, needs drastic improvement. The OIOS 
is woefully underfunded and lacks true independence. With respect to 
funding, the OIOS receives $24 million per budget--a paltry pittance 
when compared to the $162 million allocated to U.N.'s press office. 
Without an effective and independent auditor, the U.N.'s operations 
will continue to be plagued with misconduct and mismanagement.
  Those crucial elements are the cornerstones of the proposed Coleman-
Lugar bill, the United Nations, Management, Personnel, and Policy 
Reform Act of 2005. The bill presents a well-balanced and constructive 
U.N. reform initiative that addresses: (1) a variety of U.N. management 
weaknesses identified by the subcommittee, a lack of transparency, 
oversight, accountability, and effective budgetary and personnel 
systems, and (2) a series of U.N. policy issues that need reform, 
including peacekeeping and human rights. The legislation strikes an 
appropriate balance between important goals: effecting crucial U.N. 
reforms, preserving U.N. administrative discretion, and ensuring 
limited U.S. government monitoring and oversight.
  Our proposed legislation underscores that an effective United Nations 
is in the interest of the United States and that the United States must 
lead the United Nations toward greater relevance and capability. The 
bill also emphasizes that the U.S. push for further reform will require 
bipartisanship and the joint involvement of the executive and 
legislative branches so that the U.S. presents a unified position 
toward the United Nations. The proposed legislation exhorts the U.S. to 
use its voice, vote, and funding in the U.N. to accomplish U.N. 
management, personnel, and policy reforms. It requires the President to 
submit an annual report on U.N. reform to ``appropriate congressional 
committees.'' It also authorizes the President to withhold 50 percent 
of U.S. contributions to U.N. if he determines that the U.N. is not 
making sufficient progress in implementing reforms described in the 
act.
  While the proposed legislation acknowledges that the U.N. has 
initiated some reforms, it also recognizes that the U.N. has failed to 
make many necessary changes. The bill cites past GAO reports on U.N. 
reforms and recent U.N. reports, including the High-Level Panel Report 
and the Secretary-General's Report, on the need to expedite existing 
reforms and implement new urgently-needed reforms. It emphasizes that 
the U.N. must transform itself to meet current and future challenges 
and undertake institutional reforms that ensure the effectiveness, 
integrity, transparency, and accountability of the United Nations 
system.
  The proposed legislation recognizes the important findings of the 
subcommittee in its Oil for Food Program investigation identifying key 
internal management weaknesses that led to mismanagement, fraud, and 
abuse of the program. It also cites the June 2005 Gingrich/Mitchell 
U.N. Reform Report. The majority of the U.N. management, personnel, 
budget, and policy issues addressed in the proposed legislation are 
consistent with many recommendations of the subcommittee and the recent 
Gingrich/Mitchell report.
  The management section of the proposed legislation stems from the 
many U.N. management weaknesses revealed in the subcommittee's oil-for-
food investigation. The section strengthens the power of the Secretary-
General to replace top officials in the U.N. Secretariat and recruit 
only the highest quality individuals, placing emphasis on professional 
excellence over geographic diversity. It calls for an updated 
assessment of the U.N. procurement system and the establishment of a 
new and improved procurement process that embodies the standards 
currently present in the U.S. Foreign Corrupt Practices Act of 1977, 
which prohibit officials from making or receiving payments, gifts, or 
exchanging other promises to secure an improper benefit.
  In short, this legislation will help transform the United Nations 
into a modern and dynamic institution capable of responding to the many 
complex and varied challenges confronting it. The reforms embodied in 
this legislation provide the United Nations the opportunity to embrace 
change and regain its role as a critical institution in today's rapidly 
changing international environment. This legislation will force the 
United Nations to be a better managed, transparent, and accountable 
organization. This legislation will prevent reoccurrences of scandals 
like the Oil for Food scandal, peacekeeping abuses, and other 
managerial failures.
  I must reiterate the importance of a robust and effective U.N. for 
the future of U.S. relations with the international community. The 
U.N., when properly led and properly managed, can play an important 
role in promoting global peace and stability. Real reform, and not mere 
rhetoric, is the proper course of action to ensure an effective U.N.--
the mission of the U.N. is simply too important to look the other way.
  As I conclude my remarks, I would like to reiterate my thanks to 
Chairman Lugar for his leadership on the issue of U.N. reform and for 
the opportunity to work with him to tackle this important issue.

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