The Cable

Document dump: Concerns with contracting oversight in Afghanistan run deep

There's a lot more to the story of congressional angst over the performance of the Special Inspector General for Afghanistan Reconstruction (SIGAR) than was told in today's article by the Associated Press.

The AP story mentions a letter from Sens. Tom Coburn, R-OK, Susan Collins, R-ME, and Claire McCaskill, D-MO, sharply criticizing the SIGAR office for failing to recruit competent staff, focusing on the wrong issues (like female participation in the Afghan elections), and an overall lack of auditing and investigative reports since the office was established over a year ago.

But the letter is only the latest in a long series of congressional criticisms of the office. SIGAR was established in 2008 to oversee some $39 billion of U.S. taxpayer funds that have been appropriated for reconstruction projects in Afghanistan. To date, the office has received $23 million for its work.

McCaskill and others have been critical of SIGAR all year, and not just based on the three items found in Tuesday's letter. This October memo being circulated by Hill staffers, and obtained by The Cable, gets at a more fundamental concern: that the quality and content of SIGAR's audits and reports are seen in Congress as shoddy and substandard.

For example, SIGAR's first audit on the Defense Department's Combined Security Transition Command-Afghanistan (CSTC-A), which oversees the development of the Afghan security forces, is only four pages long and makes no mention of whether the $400 million spent on a training contract there was well used.

"It appears to have been written in such a way that SIGAR could say they had at least one audit complete before they were in existence for a year," the congressional memo states.

SIGAR's second audit is only two pages long, not counting appendices and the title page and table of contents, and devoid of any real breakthroughs as well, according to the memo. The criticisms go on and on.

When writing about the Afghanistan presidential elections in SIGAR's sixth audit, SIGAR said that the U.S. should "continue to build the [Independent Election] Commission's capabilities so that democratic principles and the electoral processes are sustained," barely mentioning the widespread fraud in that election and also failing to comment on what happened to the some $500 million of U.S. funds committed to that effort.

In an audit about the Commander's Emergency Response Program, which is a pool of money given to military commanders to address short-term needs with little oversight, auditors "did not visit any CERP sites nor did they cite any examples of wasted taxpayer dollars or funding that could have been better utilized," according to the memo.

SIGAR's assistant inspector general in charge of audits, John Brummet, defended the organization's work in an interview Wednesday with The Cable.

For example, regarding CSTC-A, Brummet said that his office's audit "was high-value work and we were able to get some significant changes in the contract oversight performed by CSTC-A." As for why SIGAR didn't examine the contractor directly, Brummet said he simply didn't have enough auditors to do the job, a problem that both SIGAR and Congress have been working on.

Regarding the Afghanistan elections, Brummet said SIGAR is conducting public-opinion polls in Afghanistan to gauge how much fraud was present in the elections. He again pointed to the lack of personnel needed to do more investigative work.

Overall, Brummet acknowledged that SIGAR's audits and investigations has resulted in zero returned taxpayer dollars, and that zero contractors have been disbarred as a result of SIGAR's audits and investigations.

"Our critics want us to spend more time focused on the performance of contractors and that's what we're trying to do right now, to expand that work," he said.

Brummet also commented on some of the numerous stories circulating about SIGAR's interactions with both the State and Defense Departments. For example, the U.S. Embassy in Kabul won't give SIGAR enough housing space for its employees there, packing four to six employees into a single shipping container-sized unit in some cases.

"Having people that have distinguished professional careers and asking them to go share a hooch with five other people is tough," he said.

He also responded to the concern that SIGAR is too close to the Pentagon, specifically Deputy Secretary of Defense William Lynn. Lynn is said to be the administration's point man on engaging Congress regarding concerns about SIGAR, and Brummet confirmed that Lynn has written a response to Congress regarding another letter senators sent to SIGAR. He couldn't explain why Lynn and the Pentagon were charged to write on behalf of SIGAR, which Hill sources expressed concerns about considering that SIGAR is supposed to be overseeing the work of the Defense Department.

The SIGAR website also is hosted by the military.

Lastly, Brummet confirmed that SIGAR's chief, Special Inspector General Arnold Fields, was scheduled to travel to Kabul to attend the inauguration of Afghan President Hamid Karzai but then cancelled his trip after discussions with the State Department.

The posture of McCaskill's office in the SIGAR scandal is curious as well. After coming to Congress and joining the Senate Armed Services Committee in 2006 pledging to be an outspoken champion of oversight and reform, McCaskill has been relatively quiet this year, perhaps so as not to openly criticize the administration of the president whose campaign she cochaired.

There will be a hearing on SIGAR's oversight work on Dec. 17, but that's nine months after McCaskill wrote her first letter, which said that 2009 would "be a critical year for the fledgling democracy in Afghanistan."

UPDATE: A SIGAR spokesperson called into The Cable to add some more information to the story. The problem of bad living conditions in Kabul is widespread and doesn't represent a specific embassy action against SIGAR, the spokesman said. Also, the spokesman relayed that the lack of auditors that hampered SIGAR's investigative abilities early on has now been largely corrected.

UPDATE2: Adrianne Marsh, the communications director for McCaskill, called in to vigorously dispute the characterization that the senator has been "relatively quiet this year" in chairing the Subcommittee on Contracting Oversight. "This is a commitment and it doesn't matter who the president is," she said, pointing to numerous press statements the subcommittee had issued in 2009.


The Cable

White House set to announce Taiwan arms deal

Three weeks after the president's visit to China, the Obama administration is getting ready to announce a package of arms sales to Taiwan that could complicate delicate relations between Washington and Beijing.

According to Taiwanese government sources, the package includes most of the items the United States and Taiwan agreed upon previously, but not F-16s or submarines. The sale could result in a stalling of the recently renewed military-to-military ties between the U.S. and China, which were restarted with fanfare this summer.

"There will be an arms package [sent from the White House to Congress for approval] but they never told us exactly what the items will be," said one Taiwanese government source, who added, "From other information that we gathered it seems to us the F-16 will not be in this decision or anytime soon."

Taiwan's deputy national security advisor, Ho Szu-yin, is in Washington this week and is said to be talking with the administration about the issue.

The Obama White House has been extremely cagey about whether the Taiwan arms sales would continue, in what form, and when. Eager to set U.S.-China relations on the right foot, U.S. officials have kept Taiwan's diplomats at arm's length, according to Taiwanese sources, giving them little information on the arms-sales package.

White House officials did tell the Taiwanese not to submit a request letter for the F-16s (so they wouldn't have to reject it), the sources said. That's the same as what happened under the last administration when, on three occasions, the Taiwanese tried to submit a letter of request for F-16s to Bush. Back then, a Taiwanese government source explained, the Bush White House said, "[D]on't do it right now, it's not good timing. You will get an answer you don't want to hear."

The Obama administration also told the Taiwanese that the arms-sales announcement would come only after the president's trip to Beijing and indicated the announcement would come before his trip to Copenhagen, which is currently slated for Dec. 18. Taiwanese sources now say they expect the decision shortly after Obama returns from the climate-change conference.

Although largely silent in the public arena, administration officials have indicated that the sales are moving forward.

"I can assure you this administration will not waiver in its commitment to provide those defense articles and services necessary for Taiwan's defense," Assistant Secretary of Defense Chip Gregson told the U.S.-Taiwan Business Council in September.

China has made clear its opposition to any new U.S. arms sales to Taiwan, telling Secretary of State Hillary Clinton as much directly during the U.S.-China Strategic and Economic Dialogue in Washington in July.

The People's Republic of China also lobbied the U.S. to scrap the planned arms sale to Taiwan during a June visit to Beijing by Michèle Flournoy, the under secretary of defense for policy. Flournoy's visit was also when the Chinese agreed to resume the mil-to-mil discussions.

Now there is a concern that China will halt that cooperation, for at least a time, and take other punitive measures to protest the impending Taiwan arms deal. The PRC cut off military-to-military relations with the United States following the 2008 sale of arms to Taiwan by the Bush administration.

Some experts say it's not a huge issue.

"Given the broad agenda that Presidents Obama and Hu [Jintao] laid out in Beijing last month, I expect China to register their complaints, register their disapproval, and then move on," said Abe Denmark, Asia expert at the Center for a New American Security.

The Taiwanese government has already budgeted around $4 billion to purchase 66 F-16s, but Taiwanese officials do not expect a deal to happen. The initial agreement also raised the possibility of Taiwan purchasing diesel submarines, but that is also seen as very unlikely.

F-16 sales are also an issue for members of the U.S. Congress, who are concerned that the production line for the planes might shut down if foreign sales trail off. But when the White House sends whatever arms deal it decides on to Congress, only the Senate Foreign Relations Chairman John Kerry, D-MA, and House Speaker Nancy Pelosi, D-CA, have the right to object and neither is likely to do so.

A host of items remain left over from the arms-sales agreement made between the Taiwanese government and the Bush administration, including Black Hawk helicopters and Patriot missile batteries, both of which are expected to be in the package. The Bush team put through some arms sales to Taiwan just before leaving office, including Apache helicopters and destroyers.

The Obama administration is clear on its support for standing policies regarding Taiwan, including adhering to the Taiwan Relations Act, which pledges that America will help Taiwan maintain its defense capabilities. But over the years, U.S. arms sales to Taiwan have become a political football, more symbolic than strategic considering the towering and growing imbalance of power across the Taiwan Strait. China continues to build up its missile inventory opposite Taiwan, which is now estimated to top 1,300 missiles capable of hitting Taiwan.

"These arms sales are at least partially a response to China's military buildup opposite Taiwan," said one Asia hand. "The rapprochement across the strait simply hasn't been reflected in China's military deployment."

When the sale is announced, pundits on both sides of the Pacific will be sure to praise or decry the move as Obama either bravely standing by Taiwan or dangerously thumbing his nose at the Chinese. But following the harsh criticism of his trip to Beijing, criticism that the White House feels was unfair and unsupported, the White House is looking for a new story line.

One Asia hand said that the White House might see the arms-sales announcement as "a repudiation of the critics of the president's trip to Beijing," because it combats the perception that Obama is kowtowing to the Chinese.

"This shows that China policy occurs in more than one-week increments; you can't judge the success or failure from one trip," the expert said.