[Congressional Record (Bound Edition), Volume 148 (2002), Part 3]
[Senate]
[Pages 3956-3958]
[From the U.S. Government Publishing Office, www.gpo.gov]




          WASTE, FRAUD AND ABUSE AT THE PENTAGON CANNOT HAPPEN

  Mr. GRASSLEY. Mr. President, I will address the issue of defense 
expenditures and the rapidly rising appropriations for defense, 
particularly for the war on terrorism, and do it in light of the fact 
that probably within the next couple of weeks the budget will be before 
the Senate.
  The 9-11 attack wiped out any lingering doubts I or anybody else had 
about the intention of terrorists. Their intentions are now crystal 
clear: Kill as many Americans as possible and bring a lot of 
psychological trauma on the American people. I do not doubt for

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a second they will strike again when they think the time is right. If 
they do not, we will be lucky, but if we do not plan on it, we will be 
stupid.
  We must not allow American citizens to live with constant fear that 
moment will come again. This is a threat to our way of life. As 
Americans, we cannot accept that threat to our way of life. The 
terrorist threat must be eliminated.
  President Bush is doing everything possible to restore and maintain 
our security at home and to win the war on terrorism abroad. The war on 
terrorism will not come cheaply. We must all accept that. Right now we 
have no choice. So I am not going to quibble with the details of the 
Department of Defense budget and the recommendations from the Senate 
Budget Committee. Secretary Rumsfeld and the President have my support 
in the war against terror.
  We ought to look at history and think in terms of other times the 
defense budget has been ramped up very quickly and the considerable 
amount of waste that accompanied it. The situation of the 1980s, when 
this last happened, obviously, was somewhat different from what the 
situation is today when we are in the midst of a war. Back then, we 
were in the cold war. There was some understanding we needed to do 
more, but in the process of not fighting a war and not having a 
demonstrated need that was as conclusive as this war on terrorism is 
now, there was an opportunity for waste.
  I want to warn Secretary Rumsfeld about waste. Big budgets breed 
waste, and the Pentagon has shown a world class reputation for waste 
and mismanagement. It seems to be lurking in the shadows waiting for 
the Secretary of Defense to open the money spigot. If he fails to keep 
a lid on waste, support for President Bush's defense buildup will 
evaporate quickly, particularly if there is a downturn in the war on 
terrorism where there is not quite as evident to the public at large of 
the need for the amount of money we are now appropriating when one 
might say the war is very active.
  If this were to happen, the support for the defense buildup would 
evaporate and troops in the field would end up on the short end of the 
stick. If we do have this waste, this Senator will be on the 
Secretary's back.
  A little piece of local history might help everyone in the Senate 
understand where I am coming from. Back in the early 1980s, at the 
height of the cold war, President Reagan launched a massive military 
buildup that was fiercely debated in the Senate for 3 or 4 years. I 
challenge my colleagues to understand this was a defining experience 
for me and it still shapes my thinking on defense. I was convinced 
almost from day 1 that President Reagan's defense Secretary, Cap 
Weinberger, was bent on throwing new sums of money at problems better 
solved by structural reform and real leadership. So joining a lot of my 
colleagues, we made an effort to stop it probably 2 or 3 years after we 
should have. As a conservative Republican, this was not easy for me to 
do but it was the right thing to do, and we should be prepared to watch 
how this money is spent in this ramp-up and be cognizant, watching for 
waste.
  During this time in the early 1980s, I offered an amendment to freeze 
the defense budget. This was in the fiscal year 1986 budget resolution. 
My amendment was adopted May 2, 1985, by the slimmest of margins: 50 to 
49. I think the Senate, by making that decision and through that act 
alone, threw a monkey wrench into the last big plan to ramp up the 
defense budget.
  There was quite a case built for doing that at that particular time. 
Even though $750 pliers, $750 toilet seats, and $7,000 coffee pots are 
not the reason for defense waste in its entirety, they are clear-cut 
examples that everybody understands.
  Those examples helped make a case for the freezing of the defense 
budget. The spare parts horror stories were a turning point. They 
convinced many that the Pentagon defense buildup was a colossal 
taxpayer rip-off. It undermined the credibility of the planned defense 
buildup and it turned many into defense reformers, to watchdogging, 
digging into the waste, fraud, and abuse at the Pentagon.
  I was at it that day, today, and I will be at it tomorrow. That is my 
warning to the people at the Defense Department, from Secretary 
Rumsfeld on down, and, in the process of spending more money, find a 
way to control waste.
  Unfortunately, the Secretary has a major obstacle to overcome before 
getting waste under control. It is a simple rule that you cannot begin 
to control waste until you know what things cost. You will never get a 
handle on the cost until the books of account are in order. Every shred 
of evidence I have examined over the years tells me that the books at 
the Defense Department are in shambles. The chief financial officer, 
Mr. Zakheim, knows exactly what I am talking about. I have had 
opportunities to discuss this with him.
  The best barometer on the quality of bookkeeping at the Pentagon is 
the annual audit of financial statements. The results are dismal. There 
is over $150 billion in financial actions for which there is no 
supporting documentation. Those are accumulative, over some years.
  Criminals, quite frankly, could be tapping into the money pipeline at 
the Department of Defense. People there would never know it. During 
Secretary Rumsfeld's nomination hearing last year, he was grilled by 
the senior Senator from West Virginia about the very same problem. As a 
result of that exchange, Senator Byrd and I cosponsored a financial 
oversight initiative, section 1009 of the fiscal year 2002 Defense 
authorization bill.
  Having accurate financial information at your fingertips is a key to 
controlling waste. And to do it right now, we don't have that tool. The 
Defense Department needs to get it. I believe they are working on 
getting it. I believe I can speak for Senator Byrd and for myself that 
we want to help the Defense Department get there. The Secretary has his 
work cut out. For starters, he is going to need a junkyard dog. Now 
that there is an inspector general in place, I believe that will help. 
With the Pentagon's money spigot wide open--once again in a way that 
nobody at this point is going to raise any questions because you only 
go to war to win a war or else you do not have any business going to 
war--the new inspector general has to be operating on a high state of 
alert.
  A 3-year oversight investigation of the office of the inspector 
general tells me that is not the case today. That office has serious 
management problems. The new inspector general will need to clean 
house. We are obviously asking the Secretary to control waste, do it by 
cleaning up the books, get a handle on costs, and do not fritter away a 
golden opportunity to rebuild the Armed Forces.
  Waste is a constant danger at the Pentagon. When we send military 
personnel into harm's way, we should all be confident they have what 
they need to get the job done. If we allow waste to spin out of 
control, our troops on the front lines will be the first to suffer; we 
will be back making the same cases as we did in the mid-1980s.
  I believe there is some reason to think this Secretary of Defense, 
Mr. Rumsfeld, sees a need to overcome these problems more so than a lot 
of his predecessors. There are two reasons I say that. No. 1, 2 or 3 
weeks ago I was able to speak to a House committee on the sloppiness of 
how credit cards are handled by Department of Defense personnel and the 
tremendous waste of taxpayer money by the purchase of personal items on 
a card that says ``for official government business only.'' Within 2 
days of those remarks, the Secretary of Defense told the comptroller of 
the Defense Department to get this matter under control. There has been 
put in place immediately a task force to accomplish that goal. I 
publicly thank Secretary Rumsfeld for responding as he has in that 
particular instance.
  Last, I refer to a speech that Secretary Rumsfeld gave on September 
10, 1 day before the infamous day of September 11. It seems to me, 
without anticipating the terror that was going to be brought against 
America with that dastardly act of September 11, he recognized in this 
speech the importance

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of being on top of the taxpayers' dollars as spent on defense.
  I read from his speech delivered on September 10:

       Every dollar squandered on waste is one denied to the 
     warfighters. That's why we're here today challenging us all 
     to wage an all-out campaign to shift Pentagon resources from 
     bureaucracy to the battle field, from tail to tooth.
       We know the adversary. We know the threat. And with the 
     same firmness of purpose that any effort against a determined 
     adversary demands, we must get at it and stay at it.
       Some might ask, how in the world could the Secretary of 
     Defense attack the Pentagon in front of its people? To them I 
     reply, I have no desire to attack the Pentagon; I want to 
     liberate it. We need to save it from itself.
       The men and women in this department, civilian and 
     military, are our allies, not our enemies. They, too, are fed 
     up with bureaucracy. They, too, live with frustrations. I 
     hear it every day. And I'll bet a dollar to a dime they, too, 
     want to fix it. In fact, I bet that they even know how to fix 
     it, and if asked, will get about the task of fixing it. And 
     I'm asking.

  I say parenthetically, I think what the Secretary of Defense did 2 
weeks ago, in getting the comptroller on that credit card situation in 
the Department of Defense, is an example of his willingness to ask and 
hopefully get it done.
  Continuing to quote:

       They know the taxpayers deserve better. Every dollar we 
     spend was entrusted to us by a taxpayer who earned it by 
     creating something of value with sweat and skill--a cashier 
     in Chicago, a waitress in San Francisco. An average American 
     family works an entire year to generate $6,000 in income 
     taxes. Here we spill many times that amount every hour by 
     duplication and inattention.

  Then in the last paragraph I am going to quote he says:

       That's wrong. It's wrong because national defense depends 
     upon public trust, and trust, in turn, hinges on respect for 
     the hardworking people of America and the tax dollars they 
     earn. We need to protect them and their efforts.

  There is a lot more from this speech that Secretary Rumsfeld gave 
back on September 10 to employees of the Defense Department. But these 
few paragraphs, I hope, will give you hope, as they give me hope, that 
Secretary Rumsfeld will get on top of the situation at the Defense 
Department, an environment that encourages waste of the taxpayers' 
money, and will see through the process of financial management reform 
and all that will do for controlling the waste.
  I yield the floor and I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Jeffords). The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. REID. Mr. President, I ask unanimous consent the order for the 
quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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