[Congressional Record Volume 156, Number 156 (Thursday, December 2, 2010)]
[Senate]
[Pages S8377-S8380]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           UNRESOLVED ISSUES

  Mr. DORGAN. Madam President, I wanted to take some time today to talk 
about some issues that have been around for a number of years and 
remain unresolved in a way that I believe is very detrimental to our 
country and our citizens.
  There is a lot of discussion these days about deficits and debt at 
the Federal level. We have a $13 trillion Federal debt and a $1.3 
trillion deficit this year. We have a fiscal policy that is in great 
difficulty. The discussion these days is about extending tax cuts--by 
the way, none of which is anticipated in the budget numbers that are 
already unsustainable, showing large debts for the long term. Extending 
all of the tax cuts that were scheduled to expire this year will add $4 
trillion to the $13 trillion debt that already exists. The reason I 
mention the fiscal policy issue is, when we talk about debt and 
deficits, most people talk about the need to cut spending. We also need 
some additional revenue from those who are not paying their share. But 
we do need to cut spending.
  I believe I have held 21 hearings as chairman of the Democratic 
Policy Committee over recent years--21 separate hearings on the subject 
of waste, fraud, and abuse in contracting in the wars in Iraq and 
Afghanistan. Much of it still goes on in terms of the work with the 
Pentagon on this contracting issue.
  I have just received a letter from the inspector general at the 
Pentagon, who is looking into one of the issues of the last hearings--
the issue of soldiers and contractors who were exposed to sodium 
dichromate, a chemical that was the subject of the movie ``Erin 
Brockovich,'' soldiers who were exposed and not told they were exposed 
to that deadly carcinogen and some of whom have already died. They were 
both National Guard and Regular Army soldiers.
  In the context of doing a lot of these hearings, I have discovered 
and I believe that throughout the last decade, we have seen the 
greatest waste and fraud and abuse in the history of this country. It 
has contributed immeasurably to this overspending and deficits and 
debt. I wanted to talk about that work we did, myself and my 
colleagues, over 21 separate hearings.
  At one of the hearings we held, we had testimony from a man who, in 
Iraq, was responsible for rooting out corruption in the Iraqi 
Government. His name was Judge al-Radhi. I have a photograph of Judge 
al-Radhi. He testified in this country. He testified that in his work 
as head of the anticorruption unit in Iraq, he found that $18 billion 
was missing, most of it American money, most of it coming from the 
American taxpayer.
  Just missing. Now, why was he here in the country testifying at a 
hearing I held? Because he got booted out of Iraq, and he got no 
support from the U.S. Government as he was booted out of Iraq, and he 
ended up in this country. But he is the person who was supposed to be 
rooting out and investigating and prosecuting waste and fraud and 
abuse.
  His investigations and the investigations of his staff--some of whom 
were assassinated, some of whose families were killed--show there was 
$18 billion--$18 billion--missing, and most of it was American money. 
Well, that is the story about Judge al-Radhi.
  We had a hearing early on in this process and talked about the issue 
of contractors and contracting. As you know, in the early part of the 
war in Iraq and in Afghanistan, money was just shoved out the back door 
of the Pentagon, hiring contractors, very large contracts, in most 
cases no-bid, sole-source contracts.
  A very courageous woman came to testify before our committee. Her 
name was Bunnatine Greenhouse. She was the highest civilian official at 
the Army Corps of Engineers, the highest civilian official in the 
Pentagon in charge of contracting. Here is what she said. She objected 
to the way the Pentagon was doing these contracts, massive contracts, 
sole-source, a massive amount of money, and she watched as the normal 
processes were avoided and ignored. She testified in public:

       I can unequivocally state that the abuse related to 
     contracts awarded to Kellogg, Brown & Root represents the 
     most blatant and improper contract abuse I have witnessed 
     during the course of my professional career.

  This is an extraordinary woman, the highest civilian person in the 
Army Corps of Engineers. She was in charge of contracting. Two master's 
degrees, came from a family in Louisiana. All three kids have advanced 
degrees. Her brother, by the way, was one of the 50 top professional 
basketball players in the last century, Elvin Hayes. Bunnatine 
Greenhouse. Remember that name. A very courageous woman, she saw 
abuses, spoke about it publicly, and for that she lost her career. She 
gave up her career. She was told: Resign or be fired.
  Let me talk about what she meant when she said the most unbelievable 
abuses she had seen in contracting. I want to do it starting small 
because then I am going to talk about billions of dollars.
  But at one of our hearings, we had a man who kind of looked like a 
bookkeeper at a John Deere dealership in a

[[Page S8378]]

small town. He was kind of a good old guy with glasses, and he had been 
in charge of purchasing for Kellogg, Brown & Root or Halliburton over 
in Kuwait, purchasing the things our troops needed in Iraq. He came and 
testified, and he said: You know, as I was purchasing things, I was 
told by my employer, Halliburton: Don't worry what the cost is, the 
taxpayer pays for this. This is cost-plus.
  So he told us a number of examples, big examples, but he brought a 
small one that I thought reflected the entire attitude.
  This is a towel. I ask unanimous consent to show the towel on the 
floor of the Senate.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. This is a towel. Halliburton was to purchase towels for 
the troops, hand towels. You know, they were purchasing hand towels to 
be awarded to the troops. So he ordered some white hand towels for the 
troops, and his boss said: Well, you can't order those white hand 
towels. You have to order the hand towels that have the logo of our 
company, ``Kellogg, Brown & Root,'' on the hand towel.
  Mr. Bunting said: Yes, but that would quadruple the cost.
  His boss said: That doesn't matter. This is a cost-plus contract. 
Order the towels. Put our company name on them.
  I mean, this is such a small but important symbol of the behavior 
that went on for most of the decade that fleeced the American 
taxpayers.
  We had a hearing in which we were told by a food service supervisor 
of Kellogg, Brown & Root that Kellogg, Brown & Root charged the Federal 
Government for serving 42,000 meals a day to American soldiers but they 
were only serving 14,000 meals. They were charging the taxpayer for 
42,000 meals--according to this supervisor who was on the ground and 
then left the company in disgust--they were charging the taxpayers, the 
American Government, for 42,000 meals a day for soldiers and serving 
only 14,000 meals a day.
  We had testimony about brand new $85,000 trucks being left on the 
side of the road to be torched because they had a flat tire or a 
plugged fuel pump. Why? Cost-plus. A new truck. Taxpayers will buy 
another one.
  There was a company called Custer Battles to which the previous 
administration and the Pentagon awarded over $100 million in security 
contracts. We had a man named Frank Willis who came to testify at a 
hearing I held. Frank Willis was a classic example of a guy who went to 
Iraq to see if he could do some good and wanted to be helpful to our 
government's effort in Iraq. He showed us a photograph, which I thought 
I had--I think we probably do not--a photograph of $2 million which was 
in the basement of the building in which he worked. They had cash, only 
cash, and their message to contractors in Iraq was, you bring a bag, we 
pay cash. And he showed me a photograph of $2 million, hundred-dollar 
bills wrapped in Saran Wrap that he said they occasionally threw around 
the office as a football--$2 million sitting on the table, American 
taxpayers' money. By the way, much of that was loaded on pallets and 
flown over to Iraq in C-130s. There were even stories about people 
dispensing hundred-dollar bills out of the back of pickup trucks. So it 
was.
  Custer Battles went on to be charged with defrauding the Pentagon, of 
massive over billing. We had a witness named Robert Isakson who said 
that Custer Battles had handed in $10 million in fake invoices for 
about $3 million of work. In one example, the company was charged with 
taking forklifts that they found--they were to provide security for the 
Baghdad Airport. They took forklifts they found in a building at the 
Baghdad Airport--they received the forklifts for free because they took 
over the security. They got the forklifts, took them someplace, painted 
them blue, and then sold them back to the U.S. Government.
  The case against Custer Battles was thrown out of court on procedural 
grounds, and a new case is now pending, as I understand it, before the 
Fourth Circuit.
  We had testimony before this committee about something called The 
Whale. It is a prison in Khan Bani Saad. I want to show what we have in 
Iraq. Our country--that is, the coalition provisional government, which 
was us; we set it up in Iraq and we ran it--said: We are going to build 
a prison in Iraq, Kahn Bani Saad prison.
  The Iraqis said: We don't want a prison there.
  We said: We are going to build a prison anyway.
  So we spent $40 million of American money on this. Two contractors 
ended up getting $50 million total, and here is what it looks like 
right now in Iraq. It has never been used, never will be used. The 
Iraqis didn't want it. But our country dumped nearly $50 million into 
this project.
  You know, the question is, Who is accountable for that? Who is going 
to answer to it? And I have watched now, holding 21 hearings over a 
decade and finding that very few are held accountable for this kind of 
thing. This prison was built of a scale to house 3,600 inmates. It will 
never be finished. As you see, you have just a shell of some cinder 
blocks, and the American taxpayers are out about $50 million.
  We heard from witnesses about the Parsons Corporation, which got a 
$243 million contract to build or repair 150 health clinics in Iraq. 
Two years later, the money was all gone, and there weren't 150 health 
clinics, there were 20.
  I had a doctor, a very brave, courageous physician, come to this 
country to testify to what he saw of the ones that were completed. 
Unbelievable. So what happened to the money? The American taxpayers 
lost the money. Did this improve the health of the Iraqis?
  The physician who came to testify said he went to the Minister of 
Health in Iraq and said to the Minister of Health: Where are those 
clinics, because I am told the Americans have spent $243 million to 
build health clinics. Where are the clinics?

  The Iraqi Health Minister said: Well, most of them are imaginary 
clinics.
  Yes, but the money was not imaginary. The American taxpayers' money 
is gone.
  We had several hearings on the issue of Kellogg, Brown & Root. And I 
mention them because they got the biggest contract, sole-source 
contract. That is why they are the ones that are mentioned the most. 
They were providing water treatment to the military facilities in Iraq. 
So our solders are in military camps in Iraq, and KBR gets the water 
treatment contract. It turns out that the nonpotable water they were 
providing to soldiers in the camps that we had a hearing on was more 
contaminated than raw water from the Euphrates River.
  We actually had, from a whistleblower, the internal memorandum from 
Kellogg, Brown & Root, by the guy who was in charge of the water 
contract in Iraq, and in his memorandum, he said this was a near miss. 
It could have caused mass sickness or death. But publicly, they said it 
didn't happen. The Defense Department said it did not happen. But it 
did happen, and I asked the inspector general to investigate it. He 
did. He did a report and said that both the Defense Department and 
Kellogg, Brown & Root were wrong. It did happen, in fact. That kind of 
contaminated water was being served to the troops because the contract 
was a contract that was not provided for appropriately by the company. 
The company was taking the money and not doing what it was supposed to 
do with the water.
  By the way, in the middle of these hearings, while the Department of 
Defense, Department of the Army, as well as Kellogg, Brown & Root were 
denying it all, I got an e-mail here in the Senate from an Army doctor, 
a captain, and she wrote to me and said: I am a physician in the camp. 
I had my lieutenant follow the water line to find out what was 
happening because I had patients here who showed that they were 
suffering diseases and suffering problems as a result of contaminated 
water.
  So that came from the physician who was in Iraq on the ground.
  So despite all of the denials, the inspector general finally issued a 
report saying: No, no, the Defense Department was wrong, as was 
Kellogg, Brown & Root. A contract to provide water to these soldiers 
across Iraq at the Army camps was not being appropriately handled, and 
very contaminated water was going to those camps.
  The list is almost endless. I know there is a photograph I have shown 
on

[[Page S8379]]

the floor previously because it is another contract to provide 
electrical capabilities to the Army camps. When you put up an Army 
camp, you have the need to provide electricity. And I held two hearings 
on this subject.
  This is a photograph of SGT Ryan Maseth--quite a remarkable young 
man, a Green Beret from Pennsylvania. He is shown there with his 
mother, who is a very courageous woman as well. He was killed in Iraq, 
but Sergeant Maseth wasn't killed by a bullet from an enemy gun; 
Sergeant Maseth was killed taking a shower. He was electrocuted in a 
shower. And it wasn't just Sergeant Maseth; others lost their lives as 
well--electrocuted in a shower, power-washing a Jeep.
  The fact is, what we discovered when we held the hearings was that 
the work that was done to provide electricity and to wire these camps 
was done in some cases by people who didn't have the foggiest idea what 
they were doing. Third-country nationals who couldn't speak English and 
didn't know the first thing about electricity were working on these 
issues.
  The Army originally told Mrs. Maseth that her son died, they thought, 
because he took an electrical appliance into the shower. No, he didn't. 
He was killed because shoddy electrical work was done that ended up 
killing this soldier.
  Now, Kellogg, Brown & Root denied that, as did the Defense 
Department. The inspector general did the report and said: Oh, yeah. 
Yeah, that sure did happen.
  In fact, let me show you what the inspector general has said.
  This is from Jim Childs, master electrician hired by the Army Corps 
of Engineers, to inspect this electrical work for which the American 
taxpayer paid a bundle. Jim Childs, master electrician, went in after I 
held the hearings. He said:

       [T]he electrical work performed by KBR in Iraq was some of 
     the most hazardous, worst quality work I have ever inspected.

  Let me show what Kellogg, Brown & Root said:

       The assertion that KBR has a track record of shoddy 
     electrical work is simply unfounded.

  The inspector general did the inspection. We had to redo much of the 
work in Iraq and Afghanistan, inspect it all and redo much of it. In 
the meantime, people died. We have demonstrated that there is evidence 
of shoddy work in a range of areas. Yet the contractors continue to be 
given additional contracts. For the shoddy electrical work for which 
some soldiers gave their lives, this contractor was not only given the 
money from the contract but bonus awards for excellent work. I have 
tried very hard to get the Pentagon to take back those bonuses, 
unsuccessfully. But the reason I am going through this is to point out 
that we have for a decade now been shoveling money out the door at a 
time when we are deep in debt, spending a great deal of money on the 
defense of this country, on the Defense Department, on the war effort, 
and so on. A substantial portion of that which goes out the back of the 
Pentagon in the form of contracts has represented the most egregious 
waste in the history of the country.
  One of my great regrets is that we did not--and we should have; I 
tried very hard--ever get constituted a Truman-type committee which 
existed in the 1940s to investigate this sort of spending and to try to 
shut down spending that is not only injuring our troops and disserving 
them but injuring taxpayers.
  I started by talking about the issue of sodium dichromate. We think 
about 1,000 soldiers were at risk at a place in Iraq that is called 
Qarmat Ali. Some have died. Those soldiers who were at Qarmat Ali told 
of seeing something like sand blowing all over the place. It was red, 
however. That was the sodium diechromate, a deadly carcinogen. It is 
the subject over which a movie was made called ``Erin Brockovich.''
  We have tried for a long time to get the Pentagon to be as active and 
involved as they should be with respect to the health and safety of 
those 1,000 soldiers who were potentially exposed. Like most of these 
issues, they have been very slow to respond.
  My point is twofold. One is about supporting America's fighting men 
and women, doing what is right for them. There have been a number of 
people in the Pentagon--one of whom testified before the Armed Services 
Committee in the Senate and who I strongly believe knew he was not 
telling the truth. He was a general, as a matter of fact. There have 
been a number who have denied virtually all of these circumstances. Yet 
inspectors general have investigated and said they are wrong.
  Obviously, the contractor denies these things. The contractors have 
gotten wealthy doing this. We have had whistleblowers come in. A woman 
came in and told us she was working at a recreational facility in the 
war theater, and that is at the base. There is a facility where you can 
play pool and ping-pong and do various things. It was a facility with 
many different rooms. She worked for Kellogg, Brown & Root and she was 
to keep track of how many people came in because they got paid based on 
how many people came in.
  She said: What they told me to do was to keep track of how many 
people came in to each room, and that is what we billed the government 
for. If somebody came in and went through three rooms, the government 
was billed for three visits. I went to the people in charge and said: 
This is fraud. We can't do this. We are defrauding the government. They 
immediately put me in detention in a room under guard and sent me out 
of the country the next day.
  It is the story of virtually all the hearings we have held.
  The point is twofold. One is to protect America's soldiers and do 
right by the men and women who have gone to war because this country 
asked them to. Secondly, on behalf of the American taxpayer, to decide 
if we are choking on debt and deficit, to continue doing what we know 
is wrong, shoveling these contracts out the door without adequate 
accountability is something we have to pay attention to.
  Secretary Gates has tried more than others. When I began these 
hearings, which stretched into 21 hearings, the then-Secretary of 
Defense had virtually no time for these issues. I have had an 
opportunity to talk to Secretary Gates. I know he has tried very hard 
to make changes. Moving the Pentagon on these issues is very difficult. 
There is a relationship always between the Pentagon and the largest 
suppliers and largest companies and contractors with whom they do 
business. My experience has been we can have the goods and have them 
red-handed. We can have internal memorandum from the company itself 
that says they screwed up, could have caused mass sickness and death, 
but publicly they will say none of this happened. It is about 
deception, about lying, about cheating taxpayers, and about not 
standing up the way we should stand up for America's fighting men and 
women. This Congress needs to do much more. Congress needs much 
stronger oversight, much more attentive oversight on this kind of 
spending.
  I went back and read the Truman committee work. Harry Truman was a 
Senator. At a time when a President of his own party was in the White 
House, he insisted that they establish the Truman Commission, of which 
he became chairman. He insisted on getting a committee to investigate 
waste in the Pentagon. They eventually created the committee, and they 
made him chairman. They held 60 hearings a year for 7 years. The 
committee was started with $16,000. In today's dollars, it saved $16 
billion. Think of that. There is way too little oversight going on on 
these issues. I have just scratched the surface in the 21 hearings I 
chaired. Many of my colleagues were in those hearings. This country 
deserves better.
  One of the significant responsibilities of Congress is not just to 
appropriate money and evaluate what money needs to be appropriated for 
but to do oversight. When we send money out the door, this Congress 
needs to do better oversight. What I have discovered and decided is 
that oversight is sadly lacking at the Pentagon. There are too many men 
and women, including Bunnatine Greenhouse, who gave up their careers 
and lost their jobs because they had the courage to speak out and say: 
This is wrong, this is fraud, this is cheating, this undermines our 
soldiers. There are too many men and women who gave up their careers 
because they had the courage to do that. We have whistleblower 
protections, but in many cases it doesn't work the way it should. There 
is much for us to do.

[[Page S8380]]

  I will not be chairing additional hearings because my 30 years in the 
Congress will be done at the end of this month. It has been a great 
privilege to be here. But as one can tell, I believe passionately in 
this issue, about our Federal deficits, about spending, about 
accountability, but most especially about doing things that support the 
soldiers we ask to go to war.
  This has been an abysmal record. In this decade, the amount of money 
spent on contractors--in many cases with no-bid, sole-source contracts 
that were negotiated under the most abusive conditions and in 
violation, in many cases, of rules, according to the highest civilian 
official in charge of contracting--has been a disgrace. This country 
needs to do much better.
  The work I and a number of my colleagues did holding these hearings 
has in many ways held up a spotlight and tried to shine it on the same 
spot. We have cajoled, embarrassed, and pushed, and I think we have 
made some progress. But so much more needs to be done and can be done. 
My hope is this work will continue.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Ms. COLLINS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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