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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

http://www.house.gov/reform

(II)

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

EDOLPHUS TOWNS, New York, Chairman

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

JOHN F. TIERNEY, Massachusetts

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

JIM COOPER, Tennessee

GERALD E. CONNOLLY, Virginia

MIKE QUIGLEY, Illinois

MARCY KAPTUR, Ohio

ELEANOR HOLMES NORTON, District of

Columbia

PATRICK J. KENNEDY, Rhode Island

DANNY K. DAVIS, Illinois

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

DARRELL E. ISSA, California

DAN BURTON, Indiana

JOHN L. MICA, Florida

JOHN J. DUNCAN, JR., Tennessee

MICHAEL R. TURNER, Ohio

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

BRIAN P. BILBRAY, California

JIM JORDAN, Ohio

JEFF FLAKE, Arizona

JEFF FORTENBERRY, Nebraska

JASON CHAFFETZ, Utah

AARON SCHOCK, Illinois

BLAINE LUETKEMEYER, Missouri

ANH ‘‘JOSEPH’’ CAO, Louisiana

BILL SHUSTER, Pennsylvania

RON STROMAN, Staff Director

MICHAEL MCCARTHY, Deputy Staff Director

CARLA HULTBERG, Chief Clerk

LARRY BRADY, Minority Staff Director

(III)

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

(1)

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.’’

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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

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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:]

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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. CommisVerDate 11-MAY-2000 14:41 Feb 23, 2011 Jkt 000000 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\63138.TXT KATIE PsN: KATIE
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sioner 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

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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

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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.

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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 deconflict. 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

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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 antimissile 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

28

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 deescalate 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.’’

29

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 elaboVerDate 11-MAY-2000 14:41 Feb 23, 2011 Jkt 000000 PO 00000 Frm 00033 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\63138.TXT KATIE PsN: KATIE
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rate 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.

31

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

32

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 agreeVerDate 11-MAY-2000 14:41 Feb 23, 2011 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\63138.TXT KATIE PsN: KATIE
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ment 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?

34

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.

35

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.

36

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

37

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.

38

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

39

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.

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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.

41

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 phasVerDate 11-MAY-2000 14:41 Feb 23, 2011 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\63138.TXT KATIE PsN: KATIE
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ing 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.

43

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

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ment 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.

45

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.

46

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

47

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,

48

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

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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

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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

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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 varVerDate 11-MAY-2000 14:41 Feb 23, 2011 Jkt 000000 PO 00000 Frm 00063 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\63138.TXT KATIE PsN: KATIE
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ious 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.]

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