America’s Nation-Building Follies

One week from today, America will mark the 10th anniversary of
the invasion of Iraq. That colossal mistake—more than 100,000
killed in a war over nonexistent WMDs—has cost America dearly:
nearly 4,500 troop fatalities, and more than three-quarters of a
trillion dollars.
Sixty billion of that sum has gone to rebuild Iraq. (“You break
it, you own it,” as Colin Powell famously said.) According to the
final report from Stuart Bowen—the inspector general overseeing
Iraqi reconstruction—much of that outlay, too, has been a colossal
waste.
Hundreds of projects that were started years ago now sit
unfinished and abandoned. Others that have been finished hardly
seem worth the cost—e.g., a $108-million waste treatment facility
in Fallujah that will serve only 9,000 homes. The voluminous report
is filled with details such as those concerning Anham, a defense
contractor that billed the federal government $80 for a 4-inch PVC
plumbing elbow—which is “5,574 percent more than a competitor’s
offer of $1.41.”
Small wonder, then, if audiences applaud at President Obama’s
frequent assertion that “it is time to focus on nation-building
here at home”—to “take the money we’re no longer spending at war”
and use it “to rebuild America.”
Sounds great in theory. Just one small problem, though:
America’s record at domestic nation-building isn’t much better.
Take disaster relief. Ten months after Katrina devastated New
Orleans in 2005, The New York Times reported that reconstruction
efforts had led to “one of the most extraordinary displays of
scams, schemes, and stupefying bureaucratic bungles in modern
history, costing taxpayers up to $2 billion… in fraud and waste.”
That sum represented “nearly 11 percent of the $19 billion spent to
date.” Even worse, the GAO estimated “as much as 21 percent” of
direct aid to victims “had been improperly distributed.”
“The blatant fraud, the audacity of the schemes, the scale of
the waste—it is just breathtaking,” lamented Maine Sen. Susan
Collins at the time. There was more to come. By 2009, the FBI
reported upwards of 1,300 people had been indicted on
Katrina-related offenses—and more indictments were still rolling
in.
But waste, fraud and abuse are not limited to emergencies.
Improper payments for Medicare alone total $60 billion a year—as
much as the U.S. has shelled out in Iraqi reconstruction grants
over the past decade. Even more remarkable, the $60 billion tab for
improper payments is five times what the experts once predicted the
entire Medicare program would cost. In 1967, forecasters expected
Medicare to cost a mere $12 billion by 1990, according to Veronique
de Rugy of George Mason University’s Mercatus Center. The real 1990
cost was $98 billion—and today it is five times that.
Such wild overruns are not at all unusual. Planners for Boston’s
Big Dig anticipated it would cost $2.6 billion. Final tab: more
than $20 billion. The F-22 Raptor originally was budgeted at $139
million per plane. Today’s total: more than $400 million per unit.
In 2008, California’s “bullet train” was sold to voters as a $33
billion project. Within three years the bill had reached nearly
$100 billion.
Doesn’t anything ever come in on time and under budget? Sure. It
happens. But De Rugy cites an exhaustive, 20-nation study by Danish
researchers that shows nine out of 10 public projects blow past
original cost estimates.
And sometimes, all the taxpayers get for the voluminous sums is
a giant goose egg. The Obama administration’s bad bet on Solyndra
will cost taxpayers more than a half-billion dollars, for instance.
And that’s chump change compared with the Carter administration,
which sank $88 billion (almost a quarter-trillion, in
today’s dollars) into the ill-fated Synthetic Fuels Corporation.
(History to Carter: You didn’t build that.)
Liberals harp on the military boondoggles, holding them up as
proof of the perfidy inherent in the military-industrial complex.
Conservatives gloat over social-welfare fraud, treating it as proof
that the entire system is a scam to rip off hard-working taxpayers.
The larger truth is more sobering: Metastasis in government
programs does not obey partisan boundaries.
In trying to explain what happened in Iraq, inspector-general
Stuart Bowen last week said the reconstruction effort “grew to a
size much larger than was ever anticipated,” and “not enough was
accomplished for the size of the fund expended.” You could say the
same about the federal government itself.
Bowen’s report contains excerpts from interviews with those who
were involved in the reconstruction of Iraq, such as Qubad
Talabani, the son of Iraqi president Jalal Talabani: “You think if
you throw money at a problem, you can fix it,” Talabani says. It
also quotes Deputy Secretary of State Thomas Nides: “Those in Iraq
who developed and implemented the rebuilding program intended well,
but good intentions don’t always produce good results.”
Maybe he should put that in a memo to the president. Because the
lessons learned in Iraq should lead to a greater degree of humility
when Washington contemplates its next big nation-building project —
whether overseas, or right here at home.
This article
originally appeared in the Richmond Times-Dispatch.

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America’s Nation-Building Follies

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