FUNDING OPERATIONS IN IRAQ
The $87 billion spending request contains two parts: $67 billion to support our military operations and about $20 billion for construction and security costs. I believe the construction portion of this important legislation should be structured as a long-term loan to the Iraqi people. This proposal, as well as two other important changes to the Iraq budget bill, would help to ensure American taxpayers' money is being used most productively.
First, along with a bipartisan group of my colleagues, I offered an amendment, which was approved by the Senate, to structure $10 billion of the total cost requested to build Iraq's infrastructure as long term loans to Iraq. These loans would be repaid in the future when Iraq become the prosperous nation that it has the capacity to be. Our amendment also includes a debt forgiveness provision: if 90 percent of Iraq's pre-liberation bilateral foreign debt is forgiven, then the remaining U.S. assistance not already given as loans would be converted to grants and loans already obligated would be forgiven.
This part of the $87 billion is most frequently refereed to as "reconstruction costs." My view, however, is that these funds are more appropriately described as "construction costs." When I visited Iraq last summer, I was struck by how little damage was inflicted on the nation as a result of our military operations. I saw firsthand evidence of how our precision weaponry was successful in targeting installations that posed a threat to our troops, while doing minimal harm to the civilian community.
I was also struck, however, by the dreadfully poor infrastructure of communities throughout the nation. Basic elements of a modern nation, such as electricity, clean water, schools, hospitals, roads, and bridges were virtually ignored by Saddam Hussein and left in shambles. It is vital for us to help Iraq "construct" its infrastructure as part of our overall goal of helping Iraq become a free and prosperous society. Reliable electricity and clean water are essential if the Iraqi people are to rebuild their lives, their economy, and their country.
I do not believe that it is unfair to ask the Iraqi people to invest in their own future by repaying some of these dollars to the American taxpayer, particularly because they will have the ability to do so one day. Iraq is not Afghanistan. Iraq has an educated population and abundant natural resources. Most notably, it has the second largest oil reserve in the world. The Administration projects that Iraq will be generating $20 billion in annual revenue within just two years. With economic capability like this, Iraq will undoubtedly one day have the financial resources to repay this loan. Moreover, asking that Iraqis take some responsibility for rebuilding their country will give them a sense of ownership – increasing the chances that our reconstruction efforts will endure long after our troops come home.
Second, we must prohibit any funds in the Iraq bill from being used to repay Iraqi debt to Saudi Arabia, France, Germany, and Russia. If construction costs are in the form of an outright grant – rather than a loan, as I propose – those American funds could be used indirectly to pay outstanding Iraqi debt. This is unacceptable. Americans would be justifiably outraged if even a dime is sent to countries that refused to assist the U.S. in Operation Iraqi Freedom.
If France, Germany, and Russia had their way, Saddam would still be ruling Iraq. These countries were well aware that they were lending money to a brutal tyrant.
Third, the Senate adopted an amendment I introduced that requires Iraqi construction contracts to be awarded using competitive bidding. If an agency decides for some reason that full and open competition cannot be used, it would be required to justify to Congress its reasons for curtailing the competitive process. This provision will ensure that American taxpayers know exactly how their money is being spent and that the best products and services are being procured at the lowest prices. This amendment is about accountability.
Americans have been very generous, recognizing the need to support our troops and willing to help the people of Iraq by constructing the infrastructure that Saddam Hussein left in shambles. As Chairman of the Senate Government Affairs Committee, I am determined to make sure the federal government is fully accountable for its spending and that the impact on the taxpayers is mitigated wherever possible. And, as a member of the Senate Armed Services Committee, I am committed to making sure our troops who are carrying out this important mission have the resources they need to be as safe and successful as possible.
