To better Afghanistan, boot the contractors!

[pkpatriotic]

To better Afghanistan, boot the contractors
Afghanistan President Hamid Karzai wants private security contractors out of the country. He should go even further, by kicking out all development contractors. Their record of fraud and waste is reason enough. They also undermine NGOs truly helping the Afghan people.

By Josef Storm, Malou Innocent
September 23, 2010
Washington

Afghanistan President Hamid Karzai recently issued a controversial edict aimed at removing all private security contractors from Afghanistan this fall. Given the mounting evidence of corruption and wrongdoing by US contractors attached to the US Agency for International Development (USAID), the government’s main distributor of development contracts, Mr. Karzai for once did the right thing. In fact, he should broaden his edict and remove all development contractors from his country.

Development contracting is government-sponsored stabilization and reconstruction efforts outsourced to private contractors. But from dilapidated schools and unfurnished buildings to billions of dollars charged for projects abandoned before completion, the massive fraud and waste endemic to development contracting in Afghanistan does more than leave American taxpayers ripped off and battered Afghans disappointed. It undermines the efforts of those trying to make a difference: privately-funded humanitarian nongovernmental organizations (NGOs).

Unfinished projects
Federal prosecutors are investigating US-funded development contractor Louis Berger Group over claims that it submitted inflated invoices to USAID. With the group now managing more than $1.4 billion worth of USAID-funded contracts in Afghanistan, the potential for malfeasance is vast.

Criminal and civil investigations into Louis Berger Group follow an expose in The Christian Science Monitor about a failed $60 million USAID-funded project with PADCO, another development contractor, to provide electricity capacity in Afghanistan. One Afghan engineer familiar with the project summarized, “Fifty percent they didn’t do. They just dug this … and left.” The electricity chief for Badakhshan Province was just as upset: “Now the people are hating American companies like PADCO because many times they brought millions of dollars, but didn’t do anything.”

Scam artists
Contracting problems go beyond inflating costs or leaving projects unfinished. Christopher Shays, a former Republican congressman from Connecticut who is co-chair of the Commission on Wartime Contracting, said his team is looking into cases of contractors, or what he called “outright scam artists,” charging foreign laborers to fly them to supposed jobs in Dubai. But instead, contractors dump laborers on air bases in Afghanistan with no job, no identification, and no way home. “The bigger problem,” said one official quoted in the Washington Examiner, “is that we don’t know who they are but they are inside our installations…. This presents a security risk.”

Another troubling practice is contractor staff serving short tours, many rarely lasting more than a year. With subsequent staff rotations having little to no overlap, this inevitably results in the loss of lessons learned, know-how, and counterpart rapport.

A deeper cause: monopsony
The deeper causal explanation for development-contracting problems is a term known as “monopsony.” Unlike a monopoly, in which one seller dominates the market, a monopsony occurs when a single buyer – in this case, the US government – faces numerous sellers. Thus, the single buyer should have the ability to dictate terms and drive down prices. But because the US government has surrendered its oversight responsibility, this perverted market structure has resulted in a bonanza for US-government backed contractors.

These problems stand in stark contrast to the practices of privately-funded humanitarian NGOs, many of which have long histories in Afghanistan. For example, the International Assistance Mission began work in 1966, and the Swedish Committee began in the early 1980s. Having survived both the Soviet invasion and the Taliban regime, they have been successful by focusing on one critical element – relationships. They make connections with local people, serve lengthy tours, and stress extended overlap periods between incoming and outgoing staff. Unsurprisingly, they also speak the local languages (Dari and Pashto), and know the proper etiquette surrounding that old Afghan pastime – drinking tea.

Economic development is one part social science, one part social anthropology. It thus involves working with – not around – native people. Failing to foster relationships is America’s biggest shortcoming in Afghanistan. Broken promises, unfinished work, and a reluctance to learn local customs demonstrate not only apparent lack of interest in the aims we espouse, but also seeming disdain for the people of Afghanistan.

End the suffering
With the global economy still struggling, private donors won’t be able to give as much to humanitarian NGOs. The US government continues to finance the development-contracting world’s ongoing waste and corruption. Sadly, with contractors’ unlimited resources, they also can drain the talent pool of those likely to work for NGOs. Thus, a two-front assault on humanitarian NGOs is taking place. This is tragic, as these organizations are often the ones most able to improve the lives of the Afghan people.

Certainly, Afghans still face an uphill battle in securing their own safety and stability, and rooting out corruption. But it is clear that US-government contractors are mired in mismanagement and failure, perpetuating dependence at best. It is time for Karzai to end this suffering by drawing another line in the sand and mandate that all US-government development contractors be removed from Afghanistan as soon as reasonably possible.

 

[muse]

September 27, 2010
Brother of Afghan Leader Is Subject of Wiretapping
By JAMES RISEN

WASHINGTON — The National Security Agency has been conducting electronic surveillance of a brother of the Afghan president, Hamid Karzai, as part of a corruption investigation into his business dealings in Afghanistan, according to United States officials.

The National Security Agency’s wiretapping of Mahmoud Karzai, an older brother of President Karzai, appears to be part of a larger criminal investigation now under way by federal prosecutors in New York, according to the officials, who declined to be identified by name discussing a criminal inquiry.

Mahmoud Karzai, who ran restaurants in the United States before the attacks of Sept. 11, 2001, is widely seen as one of the most powerful and well-connected business leaders in Kabul. He has been criticized in Afghanistan for taking advantage of his status as the brother of the president to engage in insider dealing in real estate, cement and other industries, and he has angered powerful officials in the Afghan Army by developing a lucrative residential real estate project on thousands of acres of valuable land in Kandahar that the army claims to own.

His role as an investor in Kabul Bank, Afghanistan’s largest commercial bank — which was taken over by the country’s central bank in late August because of concerns about heavy losses — has brought increased scrutiny to his activities in both Washington and Kabul.

The N.S.A. wiretapping of Mr. Karzai in Afghanistan has been under way for at least several months, during a time when the crisis at the Kabul Bank was worsening.

The United States has created investigative teams with the Afghan government to fight corruption in the country, but the investigation of Mr. Karzai by federal prosecutors in New York appears to have been kept separate from that joint effort.

While the new joint anticorruption unit in Kabul has its own wiretapping capability, the fact that the N.S.A. has been involved in conducting surveillance of Mr. Karzai underscores the secrecy and sensitivity surrounding the investigation.

Gerald Posner, a lawyer for Mahmoud Karzai, said Monday that Mr. Karzai had not been contacted or interviewed by the F.B.I. or the Justice Department, and had not been told that he was the subject of an investigation.

A spokeswoman for the Justice Department declined to comment. The Wall Street Journal first reported Monday that prosecutors had opened an inquiry into Mr. Karzai. Mr. Posner said that Mr. Karzai had canceled a planned trip to the United States.

The inquiry comes at an awkward time in the relationship between the Obama administration and the government of President Karzai. For months, the White House openly criticized President Karzai for tolerating widespread corruption that undermined the credibility of his government at a time when the United States was pouring more troops into the fight against the Taliban. But recently, the administration has begun to back off its anticorruption campaign out of a growing sense in Washington that it was having little effect other than to antagonize President Karzai and his political circle.

Until recently, another of President Karzai’s brothers, Ahmed Wali Karzai, received far more public scrutiny than Mahmoud Karzai. Ahmed Wali Karzai, the chairman of the provincial council of Kandahar who is widely considered to be the political boss of southern Afghanistan, has been accused of benefiting from narcotics trafficking, and United States officials have said that he also has had a longstanding relationship with the Central Intelligence Agency.

Mahmoud Karzai, by contrast, did not go into the Afghan government and has immersed himself in business. But several Karzai relatives have said that Mahmoud has been planning to form a new political party in Afghanistan and has been thinking about running for president when his brother’s term ends.

But as he has gained prominence, accusations of corrupt dealings have plagued Mahmoud Karzai. According to a person close to Mr. Karzai, Senator John Kerry, the chairman of the Senate Foreign Relations Committee, privately confronted President Karzai over Mr. Karzai’s business dealings in a recent meeting in Kabul. After the meeting, President Karzai called Mr. Karzai and questioned him, according to the person close to Mr. Karzai.

Mr. Karzai could not be reached for comment on Monday, but in an interview last week, he denied any wrongdoing, and said that all of his business dealings in Afghanistan were honest and that he was investing in Afghanistan’s future growth.

But even some of his relatives are critical of Mr. Karzai’s aggressive style in Afghanistan.

“I have told him that he should have handled his business exactly the way we did in the U.S.,” said another Karzai brother, Qayum Karzai. Both Qayum and Mahmoud Karzai have owned and operated restaurants in the United States.

“He should not have had so much of a gray area around his business dealings,” Qayum Karzai said. “I personally have told him he should have had experts and lawyers look at his deals, and not just do it on handshakes and friendships, and make sure it doesn’t smell fishy, because you are the president’s brother.”

 

[EjazR]

Well the contractors in Iraq and Afghanistan, mostly US companies are something the Americans never hear about. They have probably as big as stake in the corruption racket as any Afghan politician