Home > U.S. Has Spent $366M of $18.4B on Iraq
by ALAN FRAM
WASHINGTON - Only $366 million has been spent of the $18.4 billion President Bush and Congress provided last fall for rebuilding Iraq, a White House report showed Friday.
Despite the administration’s initial emphasis on speedy reconstruction in Iraq, the amount is less than 2 percent of the rebuilding money lawmakers provided. The data cover expenditures through June 22.
The figure, in the latest quarterly report by the White House budget office, marks the first time the administration has said how much of the money has been spent. The funds are meant to finance everything from training Iraqi police to starting small businesses to rebuilding the country’s electric, water, health and oil production facilities.
The money was part of an $87 billion package Bush signed Nov. 6, mostly for wars in Iraq and Afghanistan. The measure was approved after weeks in which administration officials and congressional Republican leaders said the money was needed quickly to hasten work, stabilize Iraq and improve the security of U.S. troops there.
Until now, the administration has provided data only on the amount of money obligated, which means spent or owed for specific contracts. Friday’s report said nearly $5.3 billion is now owed or has been spent — compared with $2.2 billion as of the last report, for the period through March 24.
The White House budget office, in releasing the report on the Friday afternoon before the July 4 weekend, said the figures demonstrated that progress was being made. Spokesman Chad Kolton cited another number that showed the budget office has drawn up specific plans to spend $11.1 billion of the total.
"So most of the money is making its way through the pipeline," Kolton said.
Kolton also argued that the figures on actual spending mask the amount of work under way. He said that for many long-term contracts, checks are written only after substantial work is completed.
"Processes are specifically designed to be slower-moving to make sure taxpayers’ money is well spent," he said.
When the White House filed its first report in January, it estimated $10.3 billion would have been spent through June 30.
Patrick Clawson, a former World Bank official now deputy director of the bipartisan Washington Institute for Near East Policy, said while understandable, the spending rate was too slow for the battle to win support from Iraqi citizens.
"The amount of money actually spent is what Iraqis have seen," Clawson said. He said the U.S. money committed to contracts is simply "a promise to Iraqis that we plan to do something."
Clawson said the low expenditure rate is what usually happens in undeveloped countries that lack the capacity to spend much more.
The report said reconstruction in Iraq is moving forward, citing money that also has been spent from other accounts. It cited the immunization of 85 percent of Iraqi children, rebuilding of 2,500 schools and the provision of telephone service to 1.2 million Iraqis, 50 percent above the prewar total.
The report also acknowledged the harm caused by the continuing insurgency, which has forced a reduction in crude oil exports and caused missed electrical production goals.
"These challenges continue to impede the actual work from being executed and completed on schedule," the report said.
The $366 million in expenditures includes $194 million for Iraq’s police and armed forces and $109 million for the country’s electrical system.
Of the $5.3 billion committed to contracts, the largest amounts are owed for work on electricity, oil equipment, police and armed forces, the civil government and water.
Some progress is being made because of other sources of reconstruction money.
Congress provided $2.48 billion for rebuilding in April 2003. Of that, $2.4 billion has been committed to specific contracts and $1.44 billion has been actually spent, the report said.
In addition, $1.1 billion has been spent out of $13 billion in multiyear pledges in aid and loans from other countries, according to the report. And other money is coming from seized Iraqi assets and the country’s oil revenue, though much money from oil sales is being used to run Iraq’s fledgling government.
The report also said it will cost about $1.5 billion over the next 15 months to operate a U.S. Embassy in Iraq. That excludes the costs of building a huge, secure new embassy in Baghdad, which by some estimates could cost another $1 billion.
The figures exclude U.S. war-fighting costs in Iraq, which the administration said in May were $97 billion to date. The White House has said it expects 2005 military costs in Iraq to exceed $50 billion, though lawmakers of both parties have said they expect a total closer to $75 billion.