To affirm the Iraqi Government position of no amnesty for terrorists who have attacked U.S. forces.

NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2007

The PRESIDING OFFICER. Under the previous order, the Senate will
resume consideration of S. 2766, which the clerk will report.
The bill clerk read as follows:

A bill (S. 2766), to authorize appropriations for fiscal
year 2007 for military activities of the Department of
Defense, for military construction, and for defense
activities of the Department of Energy, to prescribe
personnel strengths for such fiscal year for the Armed
Forces, and for other purposes.

Pending:

McCain amendment No. 4241, to name the Act after John
Warner, a Senator from Virginia.
Nelson of Florida/Menendez amendment No. 4265, to express
the sense of Congress that the Government of Iraq should not
grant amnesty to persons known to have attacked, killed, or
wounded members of the Armed Forces of the United States.
McConnell amendment No. 4272, to commend the Iraqi
Government for affirming its positions of no amnesty for
terrorists who have attacked U.S. forces.
Dorgan amendment No. 4292, to establish a special committee
of the Senate to investigate the awarding and carrying out of
contracts to conduct activities in Afghanistan and Iraq and
to fight the war on terrorism.
Kennedy amendment No. 4322, to amend the Fair Labor
Standards Act of 1938 to provide for an increase in the
Federal minimum wage.
Frist amendment No. 4323 (to Amendment No. 4322), to amend
title 18, United States Code, to prohibit taking minors
across State lines in circumvention of laws requiring the
involvement of parents in abortion decisions.

The PRESIDING OFFICER. Under the previous order, the Senator from
Rhode Island, Mr. Reed, shall be recognized to speak for up to 20
minutes.
Mr. REED. Mr. President, I rise this morning to discuss the fiscal
year 2007 Defense authorization bill. I am glad it is on the floor. It
is very important legislation, and it is arriving in a timely manner
where we can dispose of it along with the other body and hopefully
conclude in the next few weeks with a finalized Defense authorization
bill.
I would also note that this is Senator Warner's last bill as chairman
of the Senate Armed Services Committee, and I personally want to
commend him and thank him for his leadership, not only as the chairman
of this committee, but as a young sailor, a young marine, and a more
mature Secretary of the Navy, and now a mature Member of the United
States Senate. So thank you, Senator, for your leadership and
friendship.
Mr. WARNER. Mr. President, I thank my colleague from Rhode Island. I
appreciate his remarks, a Senator with a very distinguished military
record of his own, and quite modest about it. But at some point I would
love to have a colloquy with the Senator on why Rhode Island--we are
talking about sovereignty and the formation of governments--about why
did they hold out those many years before ratifying the Constitution?
At some point, could the two of us have a colloquy about that?
Mr. REED. I would be happy to do that, in the future.
I would like to highlight some of the aspects of the bill which I
think are very important. I have had the privilege of working with
Senator Cornyn as the ranking member of the Emerging Threats
Subcommittee. It has been a real pleasure. He has conducted the
committee with great efficiency and great cooperation. The staff has
been particularly helpful on a bipartisan basis.
I am pleased to note that in the context of our deliberations,
several important measures were included in this legislation. First, we
have authorized an additional $400 million for science and technology
programs. The original request sent by the Department of Defense was
woefully inadequate. Science and technology is the key to our future on
the battlefield as we match the skill and valor of our soldiers with
the very best technology. We have to continue this investment. I am
pleased that our legislation increases that item by $400 million.
Also, the bill includes language to require a report to Congress on
the testing policies and practices that should be pursued with respect
to rapid acquisition programs, spiral development programs, quick
reaction fielding programs, and the testing for safety and
survivability of deployed equipment. One of the weaknesses, I believe,
with the present approach of the Department of Defense is a failure to
adequately test and evaluate, and I think that failure has to be
corrected and this report will, I hope, put attention on this issue and
lead to positive results.
The legislation also urges the Department of Defense to identify and
nominate an individual to serve as the Director of Operational Test and
Evaluation. This position has been vacant since January 2005. It is a
critical position. This individual is the key independent personality
in the Department of Defense to look at the testing and evaluation of
new equipment. Without this position, the testing emphasis is woefully
inadequate in the Department of Defense.
As we put new systems into the military, we have to ensure that these
systems are adequately tested. Without an individual with that
responsibility and that position and posture within the Department of
Defense, we are not providing the appropriate personality and mechanism
to do the job.
The bill also establishes the Joint Technology Office to coordinate
all DOD hypersonics research programs in

[[Page S6106]]

conjunction with NASA. The new office reflects an appreciation of the
important role that these technologies can play in advanced air
platforms, missile systems, and space systems. The committee's
provision is an effort to ensure that millions of dollars being
invested by the services and by DARPA in hypersonics are optimized and
coordinated to enable this maturing set of technologies to reach
operational capabilities at the highest possible rate and at the
earliest possible time.
The bill also extends the authority for DOD to run technology
competitions and awards cash prices to winners. This is a provision
that DARPA uses very effectively.
The bill also authorizes more than $30 million in increases for
research that supports defense manufacturing technology. A growing
concern in the United States, in both the defense and commercial
sector, is whether or not we have the capability to manufacture what we
invent. This money will help us enhance our manufacturing abilities
throughout the United States.
There is another area of the bill that I think is very important and
that is the area that helps us protect this country from weapons of
mass destruction. First, the Cooperative Threat Reduction Program of
the Department of Defense is fully funded with a budget request of $372
million. The Cooperative Threat Reduction Program is one of the leading
nonproliferation programs. It allows our Government to cooperate with
other governments, principally those of the former Soviet Union, to
reduce the availability and supply of the fissile material and
potential access to nuclear devices.
Also, the nonproliferation programs at the Department of Energy are
fully funded at $1.7 billion. This funding is critical. One of the most
obvious threats and the most grievous threats to face this country is
the existence of nuclear weapons, particularly if they fall in the
hands of terrorists. One very effective way to prevent this potential
apocalypse is to ensure these weapons are fully under the control of a
credible responsible party. In fact, in many cases we are destroying
some of this material to prevent it from ever being used again.
The bill also includes an important waiver for the President with
respect to the conditions that Russia must meet for chemical weapons
destruction programs. It is important to continue to have these
programs go forward. This waiver gives the President flexibility to
continue these efforts.
In the areas of combating terrorism and homeland defense, the bill
authorizes funding increases of about $150 million. Approximately $100
million of these funds are being used to fund the top eight unfunded
requirements of the Special Operations Command. We all understand each
of the components of the Department of Defense submit their requests.
These eight elements were not funded under the prevailing budget. Our
legislation would provide $100 million to do that and allow our special
operators to continue to enhance their technology and their programs.
The increase will provide, I think, also, support for our Weapons of
Mass Destruction Civil Support Teams. These are military teams that are
organized in case of a weapons of mass destruction incident in the
United States. They are critical. The original 32 teams played a key
role. This would allow them to upgrade their equipment.
The bill also authorizes about $70 million to fund two of Northern
Command's highest unfunded priorities. Included among these priorities
are interoperable communications to facilitate the support of civilian
authorities. This is an obvious need after Hurricane Katrina. When we
go back--I am sure my colleagues are in the same position--to our home
States we hear a persistent cry from fire and police officials that
they need interoperable communications to talk amongst themselves and
to talk to other levels of command.
The bill also creates a senior executive position within the Office
of the Assistant Secretary for Defense for Special Operations and Low-
Intensity Conflict to provide management oversight for SOCOM's
acquisition programs. One of the lacking elements in SOCOM's
organization is an acquisition specialist. This bill would put in a
person with those skills, so they can facilitate the acquisition and
development of new technology for our Special Operations Command.
The bill also includes an authorization for the Department of Defense
to use counterdrug funds to support U.S. assistance to the unified
counterdrug/counterterrorism military campaign in Colombia. Last April,
I was in Colombia and I had the opportunity to meet with President
Uribes. I was encouraged by what he has done and what the people of
Colombia have done. I also visited with our military personnel and
civilians working to help the Colombian military personnel who have
been working to fight narcoterrorism and strengthen democratic
governance in Colombia, and I was extremely impressed with what they
have done since my last visit in 2000. I believe, as we support the
Colombians in their efforts, we will make a significant contribution to
stability in that region.
Finally, with respect to our efforts on the Emerging Threat
Subcommittee, I note the bill includes authorization for incentive
clauses in some of our chemical demilitarization contracts. This
authority is intended to provide a more efficient way to close some of
our chemical weapons facilities and to meet international deadlines.
All of these efforts were the result of the close cooperation of
Senator Cornyn and the staff with respect to the Emerging Threats
Subcommittee.
Let me now turn to an issue of increased importance in the last few
days and that is missile defense. We are all anxiously observing what
is going on in North Korea--the intelligence suggesting that the North
Koreans are preparing to launch a long-range ballistic missile.
This bill contains language that I think recognizes a need to
continue to develop a missile defense system and to do so in a way that
can assure its effectiveness. The bill would authorize additional
funding for systems that we know are working and are extremely
valuable, including the Aegis BMD system and the Patriot/PAC-3 system.
I note the Patriot system is our only system that has actually
intercepted a hostile missile, and that additional support for this
system is more than justified. I also note that the Patriot system
was rigorously tested and was subject to operational testing before it
was fully deployed.

The largest single missile defense funding increase which is
authorized by this bill is $115 million for additional integrated
flight tests for the Ground-based Mid-course Defense system, the GMD. I
think it is very important to focus in on operational testing of this
system. One of the shortcomings of the whole program for developing our
missile defense system has been a rush, in many cases, to failure, not
taking the steps to test the system or not designing tests that are
operationally significant. In that respect, we have spent a lot of
money but we have yet, I think, to fully and effectively deploy the
ground-based mid-course system.
We have to recognize that after three successive intercept flight
test failures, the Missile Defense Agency is taking some steps which I
think are encouraging. They created an Independent Review Team and a
Mission Readiness Task Force to analyze these failures and recommend
improvements to the GMD program.
Again, one of the persistent criticisms I had was that the system was
rushing pell-mell forward without stopping to evaluate the mistakes
that have been made and then planning for a thorough and exhaustive
system of tests. Therefore, the effort was just to put something in the
ground, not to ensure that missile system would work adequately.
MRTF, the Mission Readiness Task Force, recommended that four ground-
based interceptors be diverted from planned operational deployment--
essentially sitting in the ground being described as operational, but
frankly I don't know anyone who would give that a high probability of
success--to using these missiles for ground tests. I think that is a
step forward in terms of development the system.
These recommendations were accepted by the Missile Defense Agency and
the Defense Department. Again, I think a recognition of a new
pragmatism and realism on the part of the Missile Defense Agency,
something

[[Page S6107]]

that is more than overdue. We need more testing to ensure the GMD
system will work, and I think the legislation we have before us will
signal and encourage such testing.
The bill would also include a provision that would require the
Department to submit to Congress each test and evaluation plan approved
by the Director of Operational Tests and Evaluation under Section 234
of last year's National Defense Authorization Act. Again, this
provision is designed to help improve testing and to show the emphasis
that the Congress places on this testing.
Finally, the bill includes a provision that would extend the
requirement to have the GAO assess the missile defense program. The GAO
plays a very valuable role as an outside objective observer on the
progress of missile defense.
We have to invest in a missile defense system, but we have to do it
wisely. We have already seen where the effect of other budget
priorities, principally Iraq, has even caused the administration to
move money away from their original plans in missile defense. I believe
we cannot afford to waste money in this regard. We have to invest it
wisely. Part of that wise investment means having an adequate,
thorough, exhaustive operational testing program to make steady
progress, rather than to rush to failure.
I would like to turn to another topic which is of concern to myself,
and that is the shipbuilding program. Since 2001, most of the focus of
the Department of Defense and Congress, indeed, of the Nation, has been
on our land forces, the Army and Marines. They are engaged in combat in
Afghanistan and Iraq and doing a magnificent job. They are bearing the
burden of a very difficult combat situation.
However, our Navy is still a vital element in our national defense.
Its importance will continue to loom significant in the future. The CNO
has stated that he needs $13.5 billion each year for at least the next
decade to recapitalize the fleet. With this funding, the Navy must also
build approximately 11 ships per year to maintain a 313-ship fleet.
Mr. WARNER. Mr. President, will the Senator kindly yield for me to
make a unanimous consent request so Senators can arrange their
schedules?
Mr. REED. I yield to the Senator from Virginia and will then regain
my time.
Mr. WARNER. This is a cleared unanimous consent request on both
sides. I ask unanimous consent that at 11:15 the Senate proceed to a
vote in relation to the Dorgan amendment No. 4292 and that no
amendments be in order prior to the vote. I further ask unanimous
consent that Senator Dorgan be recognized to speak for up to 10 minutes
between now and the time before the vote.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. REED. As I stated, the Chief of Naval Operations indicated he
would need approximately $13.5 billion each year for the next decade to
recapitalize the fleet. However, the President's budget request only
includes 7 ships in fiscal year 2007 versus the 11 that the Chief needs
to maintain the 313-ship fleet. Seven ships in fiscal year 2008. In
2009 the suggestion is they move up to nine ships. But those plans have
been delayed before.
This shipbuilding level simply cannot sustain the fleet. My greatest
concern is with respect to the construction level of submarines. While
many believe that the need for submarines has diminished with the end
of the Cold War, the demand for these unique assets has never been
greater.
Last week I was with Senator Dodd and Senator Inouye for the
christening of the USS Hawaii, our newest Virginia Class attack
submarine at Groton, CT. Admiral Roughhead, Commander of the Pacific
Fleet, pointed out submarines are his most demanded asset. They are the
one ship that is constantly requested by commanders throughout the
Pacific to do the tasks that are necessary to defend the Nation.
This is true in our global war on terrorism as we need the ability
for stealthy insertion of special operations troops. We need to be able
to recover these troops, we need to have the capacity to strike with
precision-guided Tomahawk cruise missiles. All of these are
capabilities of the submarine fleet.
Back in March of 2004, Admiral Bowman, who was then the Director of
the Navy's Nuclear Propulsion Program, suggested to me that the Navy
was only able to meet about 65 percent of the combatant commanders'
submarine requirements with the current fleet of 54 boats. In 2003,
Vice Admiral Grossenbacher, then commander of the Naval Submarine
Forces, estimated we needed 70 submarines to meet the request of all of
the commanders. These are requests that will simply not be met if we
drop our submarine fleet below certain limits.
In addition, we understand that China is developing a very robust
submarine fleet. Today, China's submarine fleet is estimated at a
number of approximately 60 boats. In 2004 and 2005, 12 new submarines
joined the Chinese fleet. New nuclear-missile-attack boats are coming
on line, and China has one of the largest modern diesel submarine
fleets in the world. Clearly, there is a need to prudently react to the
growing underwater prowess of China.
Presently, the U.S. Navy has 282 ships, including 54 attack
submarines. In the fiscal year 2007 long-range plan for construction of
naval vessels, the Navy expressed the intent to maintain 313, but only
48 attack submarines. Recall recently there were requirements for up to
70 submarines--at least discussion of 70 submarines--or 54 submarines;
48 attack submarines are currently in the plan. The Navy is in danger
of not even being able to put to sea 48 attack submarines at current
build rate.
Right now the Navy is currently procuring one Virginia class attack
submarine per year, and a ninth is in the budget for this year.
However, under the original plan drawn up by the Navy in 2003,
production of two boats per year was supposed to begin in fiscal year
2007. Now the procurement of two per year has been pushed back to
fiscal year 2012.
If the Navy is able to implement its plan and begin building two
attack submarines per year in fiscal year 2012, the attack submarine
fleet will still drop below 40 before it begins to increase again. If
the 2-per-year procurement keeps getting pushed off to the left--it has
already happened 10 times where it has been pushed back--the submarine
force would drop as low as 28.
I think we all agree that 28 is a number that cannot be justified in
terms of the demand and in terms of this effort. We have to do quite a
bit to move up the construction of two submarines per year.
First, the report language accompanying this bill states: ``The
Committee does not understand the continuing delays in increasing the
[submarine] construction rate'' and directs the Secretary of the Navy
to submit a detailed plan for lowering costs and defining goals and
benchmarks for the Virginia class production program. I believe this
language will help compel the Navy and the industry to redouble their
efforts to increase the construction rate--and that is vitally
important.
Second, I am pleased to know that this legislation includes $65
million for R&D for the Virginia class submarines.
This R&D is I think critical not only to improve the capabilities of
these ships but also to continue to engage in the design force which is
part of the human capital in our submarine industrial base.
Also, I note that the bill includes $10 million for funding to begin
design work on the successor to the Ohio class ballistic submarine.
This design work is essential to continue our ability to produce a
follow-on generation of attack submarines but also ballistic
submarines.
I think this is absolutely critical.
Let me turn to another point with respect to our Army; that is, end
strength.
I am pleased to see that this bill authorizes an Active-Duty Army end
strength of 512,400, which is 30,000 over the President's fiscal year
2007 budget request.
The act also authorizes an Active-Duty Marine Corps of 180,000, which
is 5,000 over the President's budget request.
I think it is important to maintain the end strength of the Army.
I think it is a result of the efforts of Senators Lott and Talent and
myself on the budget resolution, where we actually moved $3.7 billion
to accomplish this.

[[Page S6108]]

Let me make one final point, if I may.
The Army end strength is a critical issue. I think we have to note,
at this time but also at a later date continue to note, that recruiting
is becoming a critical issue for the U.S. Army. According to the
information I have, the U.S. Army, in the first three-quarters of the
year, has recruited to a level of 40,000. That means in the final
quarter the Army is going to have to recruit 40,000 soldiers to meet
their goals. That is much higher than they have ever done in the last
few years.
We have a recruiting problem that is beginning to emerge.
I will devote additional time on this subject at a later time.
I yield the floor.
The PRESIDING OFFICER. The Senator from Virginia is recognized.
Mr. WARNER. Mr. President, I ask unanimous consent that the Senator
from North Dakota be recognized for 10 minutes, after which time the
Senator from Virginia be recognized for 5 minutes, and the Senate then
vote immediately thereafter.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
The Senator from North Dakota.
Mr. DORGAN. Mr. President, I thank the Senator from Virginia for his
courtesy.
This is a vote that we had before in the Senate. It is a vote on the
establishment of a type of committee called a Truman Committee. The
Truman Committee was established in the early 1940s to try to root out
waste, fraud, and abuse in military contracting. That was done when
there was a Democrat in the White House, a Democratically controlled
Senate, and a Democratic Senator named Harry Truman. He decided there
ought to be a special investigation of waste, fraud, and abuse with
respect to military contracting. They established a bipartisan
committee to do that. They found a massive amount of waste, fraud, and
abuse.
I think it is clear that perhaps the most significant amount of
waste, fraud, and abuse that has ever occurred in this country is
occurring right now. I think the American taxpayers are being fleeced.
I don't think the Congress is doing nearly enough about it.
Let me go through a couple of charts that I have shown before on the
floor of the Senate. This is from the highest ranking procurement
official in the Corps of Engineers, which does all the procurement for
the Department of Defense. She lost her job. She was demoted for being
honest.
She said:

I can unequivocally state that the abuse related to the
contracts awarded to KBR represents the most blatant and
improper contract abuse I have witnessed during the course of
my professional career.

This from the top civilian contracting official in our Government at
the Corps of Engineers. She is being demoted for being honest. She was
always given the best recommendations, the highest performance
evaluations, and when they saw that the ``old boy'' network decided to
give big sole-source contracts, no-bid contracts and do it in a way
that violated procurement rules, she spoke out. ``The most blatant and
improper contract abuse'' she has ever seen.
Let me describe one contract--the Custer Battles contract. Two guys--
Custer Battles--show up in Iraq. They know there is a lot of money. The
American taxpayers are funding not only reconstruction of Iraq but also
funding Army contracts. Two guys show up in Iraq with nothing. And $100
million later, they got $100 million of the taxpayers' money for
contracts. The first contract was to provide security at the Baghdad
Airport. There is a criminal inquiry as a result of that.
Here is what Bagdad Airport security said about this company, Custer
Battles--Mr. Custer and Mr. Battles.

Custer Battles have shown themselves to be unresponsive,
uncooperative, incompetent, deceitful, manipulative war
profiteers. Other than that, they are swell fellows.

They received 100 million in American taxpayer dollars.
By the way, they took the forklift trucks off the Baghdad Airport and
put them in a warehouse. They painted them blue and then sold them back
to the Coalition Provisional Authority--forklift trucks which didn't
belong to them. There are now criminal proceedings about this contract.
But this is the tip of the iceberg.
Mr. President, I ask unanimous consent to show an item on the floor
of the Senate.
The PRESIDING OFFICER. Without objection, it is so ordered.

Mr. DORGAN. Mr. President, a man named Henry Bunting worked for KBR,
a subsidiary of Halliburton Corporation, in the area of Kuwait where
Henry Bunting was in charge of procurement. He had to buy things.
Let me show the Senate what he bought. He brought this to a hearing
we held. This is a hand towel. He was charged, on behalf of
Halliburton's KBR subsidiary, to buy hand towels. He would order a hand
towel for the American troops at a certain price, but his company said:
Don't do that. We want you to have a hand towel that has the
embroidered logo on it, the name of our company. So double the price to
the American taxpayer for hand towels for the troops. So you have KBR
embroidered on the hand towel.
He says: Why should we do that? It doesn't matter. It is cost-plus.
The American taxpayer is paying the bill. Don't worry about the cost.
Same guy, $7,500 a month for an SUV; $45, $43 for a case of Coca
Cola. He said: Don't worry, be happy. The taxpayer is going to pay for
all of this. Don't worry about the cost.
Yes, I know this towel is one small issue. But when you buy thousands
and thousands and tens of thousands of towels and double the price so
you can put the logo of the contractor on it because it is a cost-plus
contract, that relates to $100 million contracts, and it relates, in my
judgment, to billions of waste, fraud, and abuse.
Regrettably, the Congress doesn't care enough.
I suggest we remedy this by creating a Truman-type committee. It
worked, it was bipartisan, and it began to root out the waste, fraud,
and abuse that is so prevalent.
I am not going to go through the whole list again. But let me
describe it. If you are in the right place of the country of Iraq, you
can stumble onto 50,000 pounds of nails, 25 tons of nails, lying in the
sand. Why? Because somebody ordered the wrong size nails. So you throw
them out in the sand. Doesn't matter, the American taxpayer is going to
pay for that.
Or you can see a brandnew $75,000 truck that was set on fire because
it had a flat tire, and they run it off the road. They didn't have the
capability to fix it and just left the truck. Doesn't matter, the
American taxpayer is going to pay the bill.
I think this is unbelievable. We have spent hundreds of billions of
dollars at this point.
I understand that our responsibility is to do everything we should
do, and must do, to support the troops who are fighting in Iraq.
We cannot send American men and women abroad wearing our country's
uniform and not do everything that is humanly possible to provide all
of their needs, equipment needs, weapons needs, and so on. I understand
that. That is a responsibility we have. I believe the chairman of this
committee and the ranking member of this committee have done a great
job. I am impressed with that.
The one area where all of us have failed in this Congress, however,
is oversight. We have not done the oversight. I think part of it is
because we have one-party rule in this town--the White House and the
House and Senate. Nobody wants to embarrass anybody. But the fact is
there is such massive amount of money that is going out the door in
support of these contracts--sole-source, no-bid contracts that have
promoted waste. And nobody wants to take a second look at it. Nobody
wants to see what is going on.
There are whistleblowers coming forward saying this money is being
spent. It is being spent in an unbelievable way.
This is a slightly different picture. By the way, this is $2 million
in $100 bills wrapped in Saran Wrap. This money actually belongs to the
Iraqi people that was spent by us in something called the Coalition
Provisional Authority. That was our responsibility to spend this
appropriately. This money went to Custer Battles and is the subject of
a criminal inquiry. This $2 million wrapped in Saran Wrap in $100 bills
was a part of a substantial

[[Page S6109]]

stash of cash in the basement of a building where they were standing.
This particular fellow came and testified. He said: We used to throw
these around as footballs. We wrapped up $100 bills in Saran Wrap and
threw them as footballs in the office because the message in this
office was this:
You bring a bag because we pay in cash. Bring a sack. If you want
some money, bring a sack, we pay in cash.
The stories are unbelievable.
The American taxpayer is going to pay to air condition a building. It
went to a subcontractor, to another subcontractor, and then to another
subcontractor, and pretty soon we pay the bill. The American taxpayer
paid the bill, and that building now has a ceiling fan--not an air
conditioner.
What is going on is unbelievable. Yet nobody seems to care very much.
Nobody seems to be willing to do anything. I suggest, given the
unprecedented amount of waste, fraud, and abuse, that now is the time
for us to decide we are going to take action. We will create a Truman
Committee, bipartisan, and sink our teeth into this and investigate on
behalf of the American taxpayer--investigate and expose the waste,
fraud, and abuse.
The fact is we turned down, regrettably, a bill which I offered
previously that would have prevented the no-bid, sole-source, huge
contracts going to just a couple of companies. That is one way to solve
this problem. We should have accepted that. But notwithstanding the
decision by the Senate to turn down that amendment, this amendment
stands on its own.
Are we going to decide that when the highest civilian procurement
official in the Corps of Engineers responsible for all these contracts
says that she can unequivocally state that the abuse related to
contracts awarded represents the most blatant and improper contract
abuse she has witnessed during the course of her professional career,
are we going to decide that is serious? We are going to do something
about it?
I know people will say we have done this or that. The fact is we
haven't scratched the surface--not a bit.
It is time for the Senate to ask itself whether it is serious about
oversight and doing the job.
I am not standing here trying to pull the ground out from under this
committee--or any committee. I am saying we have never spent this much
money so quickly, never given the kind of sole-source, no-bid contracts
that we have offered. We have never shoved money out the door as
quickly as we have for procurement and in support of contracts for the
troops.
Again, let me show this towel as a small hand-towel symbol of a
massive amount of waste, fraud, and abuse that I believe we ought to
correct, and we ought to begin today by approving my amendment.
The PRESIDING OFFICER. The Senator from Virginia is recognized.
Mr. WARNER. Mr. President, I thank the Presiding Officer.
Mr. President, I wish to say to our colleague from North Dakota that
he feels very strongly about this issue. That comes through in the
debate on this issue that we have had now for 3 days, on and off.
But I bring to the attention of my colleagues that three times the
Senate has addressed this issue and has rejected it. It is not a
rejection in the sense that the Senator doesn't raise points that
should be addressed to the Senate. But there is a clear record that the
Senate is addressing these issues. The Committee on Armed Services had
a number of hearings. The Committee on Foreign Relations had a number
of hearings. And most importantly, the Senate is structured whereby
issues of this type are within the jurisdiction of the Committee on
Homeland Security and Governmental Affairs.
In that committee, and it has been for many years, there is a
subcommittee entitled ``The Permanent Subcommittee on Investigation''
with subpoena power. In the colloquy we had on the Senator's bill on
Thursday, my distinguished colleague, Senator Levin, and I, both
commented, since we serve on that committee--he serves on the Special
Permanent Subcommittee on Investigations--that this is a matter we
should take up with the chairman and ranking member of the Homeland
Security and Governmental Affairs Committee.
Before the Senate tries to restructure the framework of how it
performs its work, we should focus on what is and what has been that
framework for these many years now. It is for that reason I suggest
strongly this amendment not be accepted. It would, in effect, be
overruling what we are doing on the Permanent Subcommittee.
Second, Congress should be stepping into the role that is now being
performed by inspector generals, being performed by the General
Accountability Office and, indeed, an inspector general specially
designated by the Congress and the Secretary of Defense for Iraq and
other nations.
With that, I will not move to table this because I feel very strongly
the Senate should address it in the same manner we have addressed it on
previous occasions three times and rejected it.
I ask for the yeas and nays.
The PRESIDING OFFICER (Mr. Sununu). Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
Under the previous order a vote is now to occur in relation to the
amendment.
Mr. LEVIN. I ask unanimous consent I be allowed 1 minute to respond
to my good friend's comments.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. LEVIN. Mr. President, what we are dealing with is a historic use
of no-bid contracts, where billions of dollars have been spent. There
is good evidence they have been misspent in many ways, and there is a
huge amount of waste and abuse.
I agree with my good friend from Virginia we do have committees that
could look into this matter and could focus on this matter. The agendas
of those committees are left basically to the chairmen of those
committees. If the chairmen of those committees choose to focus their
energies in other places--and I don't quarrel with the places they
look--it does not mean the Senate should not express its opinion on the
need to focus on these abuses, these excesses, this expenditure of
billions of dollars on no-bid contracts.
Therefore, I support the Dorgan amendment.
Mr. DORGAN. Might I ask consent to point out to my colleagues that
Senator Harkin, Senator Durbin, and Senator Clinton are cosponsors. I
did not mention that.
The PRESIDING OFFICER. Without objection, it is so ordered.
Under the previous order, a vote now occurs on the Dorgan amendment
on which the yeas and nays have been ordered.
The clerk will call the roll.
The legislative clerk called the roll.
Mr. McCONNELL. The following Senators were necessarily absent: the
Senator from New Mexico (Mr. Domenici) and the Senator from Alabama
(Mr. Shelby).
Mr. DURBIN. I announce that the Senator from Vermont (Mr. Jeffords)
and the Senator from West Virginia (Mr. Rockefeller) are necessarily
absent.
The PRESIDING OFFICER (Mr. Burr). Are there any other Senators in the
Chamber desiring to vote?
The result was announced--yeas 44, nays 52, as follows:

[Rollcall Vote No. 176 Leg.]

YEAS--44

Akaka
Baucus
Bayh
Biden
Bingaman
Boxer
Byrd
Cantwell
Carper
Chafee
Clinton
Conrad
Dayton
Dodd
Dorgan
Durbin
Feingold
Feinstein
Harkin
Inouye
Johnson
Kennedy
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lincoln
Menendez
Mikulski
Murray
Nelson (FL)
Nelson (NE)
Obama
Pryor
Reed
Reid
Salazar
Sarbanes
Schumer
Stabenow
Wyden

NAYS--52

Alexander
Allard
Allen
Bennett
Bond
Brownback
Bunning
Burns
Burr
Chambliss
Coburn
Cochran
Coleman
Collins
Cornyn
Craig
Crapo
DeMint
DeWine
Dole
Ensign
Enzi
Frist
Graham
Grassley
Gregg
Hagel
Hatch
Hutchison
Inhofe
Isakson
Kyl
Lott
Lugar
Martinez
McCain
McConnell
Murkowski
Roberts
Santorum
Sessions
Smith
Snowe
Specter
Stevens
Sununu
Talent
Thomas
Thune
Vitter
Voinovich
Warner

[[Page S6110]]

NOT VOTING--4

Domenici
Jeffords
Rockefeller
Shelby
The amendment (No. 4292) was rejected.
(Disturbance in the Visitors' Galleries.)
Mr. LEVIN. I move to reconsider the vote, and I move to lay that
motion on the table.
The motion to lay on the table was agreed to.
Mr. LEVIN. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. WARNER. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. WARNER. Mr. President, the managers are working with our
respective leaders on the remainder of the schedule for the next few
hours, but in the meantime I understand our distinguished Senator from
Iowa wishes to speak. I certainly have no objection.
I ask unanimous consent that at 2:15 p.m., the Senate proceed to 30
minutes of debate equally divided in the usual form relative to the
McConnell and Nelson amendments; provided further, that following the
use or yielding back of time, the Senate proceed to a vote in relation
to the McConnell amendment No. 4272, as modified, to be followed by a
vote in relation to the Nelson amendment No. 4265, and that no
amendments be in order to the amendments prior to the votes.
Mr. LEVIN. Reserving the right to object. Mr. President, I suggest
the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. WARNER. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. WARNER. Mr. President, we are still getting the concurrence of
one side on the unanimous consent request. It was my understanding it
was cleared. I think it will eventually be cleared. In the meantime, I
yield the floor so that our colleague from Iowa can speak.
The PRESIDING OFFICER. The request is withdrawn. The Senator from
Iowa.
Mr. HARKIN. Mr. President, I thank the chairman. Any time the
chairman needs to interrupt my remarks to seek that agreement, I will
be more than happy to yield the floor.
I wish to talk about an amendment I have not offered yet but I hope
will be accepted by both sides. I will offer it, and I hope it will be
acceptable. It has to do with the loss of some $8 billion for which we
cannot account.
More than 3 years into the Iraq war, we have had report after report
documenting rampant corruption and profiteering on the part of some
defense contractors, as well as lax oversight by governmental
officials. A major reason this is continuing largely unchecked is that
apparently the Department of Justice has been delaying whistleblower
lawsuits brought under the False Claims Act, and DOJ is not pursuing
these suits aggressively. So I filed an amendment designed to break
this logjam by requiring the Department of Justice to report on a
semiannual basis, every 6 months----
Mr. WARNER. Mr. President, might I ask the Senator to yield for the
purpose of a unanimous consent request?
Mr. HARKIN. Certainly.
Mr. WARNER. Mr. President, I thank the Senator from Iowa. I am
prepared to restate the unanimous consent request.
I ask unanimous consent that at 2:15 p.m., the Senate proceed to 30
minutes of debate, equally divided in the usual form, relative to the
McConnell and Nelson amendments; provided further, that following the
use or yielding back of time, the Senate proceed to a vote on the
McConnell amendment No. 4272, as modified--
The modification is at the desk. Did the Chair rule on the
modification?

Amendment No. 4272, as Modified

The PRESIDING OFFICER. Without objection, the amendment is so
modified.
The amendment (No. 4272), as modified, is as follows:

SEC._SENSE OF THE CONGRESS COMMENDING THE GOVERNMENT OF IRAQ
FOR AFFIRMING ITS POSITION OF NO AMNESTY FOR
TERRORISTS WHO ATTACK U.S. ARMED FORCES.

(a) Findings.--Congress makes the following findings:
(1) The Armed Forces of the United States and coalition
military forces are serving heroically in Iraq to provide all
the people of Iraq a better future.
(2) The Armed Forces of the United States and coalition
military forces have served bravely in Iraq since the
beginning of military operations in March 2003.
(3) More than 2,500 of the Armed Forces of the United
States and members of coalition military forces have been
killed and more than 18,000 injured in operations to bring
peace and stability to all the people of Iraq.
(4) The National Security Advisor of Iraq affirmed that the
Government of Iraq will ``never give amnesty to those who
have killed American soldiers or Iraqi soldiers or
civilians.''
(5) The National Security Advisor of Iraq thanked ``the
American wives and American women and American mothers for
the treasure and blood they have invested in this country . .
. of liberating 30 million people in this country . . . and
we are ever so grateful.''
(b) Sense of Congress.--It is the sense of Congress that
(1) the goal of the United States and our Coalition
partners has been to empower the Iraqi Nation with full
sovereignty thereby recognizing their freedom to exercise
that sovereignty. Through successive elections and difficult
political agreements the unity government is now in place
exercising that sovereignty. We must respect that exercise of
that sovereignty in accordance with their own wisdom;
(2) history records that governments derived of free
elections should not grant amnesty to those who have
committed war crimes or terrorists acts, and;
(3) the United States should continue with the historic
tradition of diplomatically, economically, and in a
humanitarian manner assisting nations and the people whom
have fought once a conflict is concluded.

Mr. WARNER. To be followed by a vote on the Nelson amendment No.
4265, and that no amendments be in order to the amendments prior to the
votes, with the modification that is at the desk having now been acted
upon.
The PRESIDING OFFICER. Is there objection?
Mr. LEVIN. Reserving the right to object, and I do not intend to
object, did I hear that they have an opportunity to speak on their
amendments?
Mr. WARNER. That is correct, 30 minutes of debate equally divided.
Mr. LEVIN. I missed that.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. WARNER. Mr. President, to accommodate the Senate, would we not at
12:30 p.m. go into recess? Perhaps I can ask unanimous consent that at
the conclusion--how much time does the Senator wish to speak?
Mr. HARKIN. Mr. President, 15 minutes.
Mr. WARNER. I ask unanimous consent that at the conclusion of the
remarks of the Senator of Iowa, the Senate stand in recess until the
hour of 2:15 p.m.
The PRESIDING OFFICER. Without objection, it is so ordered. The
Senator from Iowa.
Mr. HARKIN. Mr. President, I thank the distinguished chairman and
ranking member.
As I was saying, the amendment I filed is designed to break the
logjam of what is happening at the Department of Justice delaying
whistleblower lawsuits brought under the False Claims Act, and they are
not pursuing these cases aggressively.
My amendment would require the Department of Justice to report on a
semiannual basis on the status of its efforts to respond to
whistleblower lawsuits alleging corruption in Iraq, Afghanistan, and
elsewhere. The Department would be required to report its findings to
the Judiciary Committee, the Appropriations Committee, the Armed
Services Committee, the Homeland Security and Governmental Affairs
Committee, and the Defense Appropriations Subcommittee.
I believe this is an important first step that would allow Congress
to evaluate the Department of Justice efforts so we can decide what
further steps are needed to ensure these cases are vigorously
prosecuted.
I am pleased that Senators Grassley, Dorgan, Durbin, Kennedy,
Johnson, Wyden, Kerry, Lieberman, Leahy, and Lautenberg are
cosponsoring this amendment.
The cost of the wars in Iraq and Afghanistan has risen dramatically
in each of the last 3 years. The Congressional Research Service reports
we are

[[Page S6111]]

now spending about $6.4 billion a month in Iraq alone. That is about $9
million an hour of spending in Iraq--$9 million an hour. One of the
reasons for these runaway costs is the widespread corruption in the
contracting process: shoddy work, nonwork, theft, fraud, kickbacks,
bribes, insider dealings, inflated billings, and on and on.

There have been many reports in the press about this wave of
corruption. The Wall Street Journal reported earlier this year about
the problem. Our former inspector general in Baghdad, Stuart Bowen,
concluded that U.S. occupation authorities accounted poorly for $8.8
billion in funds dedicated to Iraqi reconstruction from the Development
Fund for Iraq. He stated this $8.8 billion is lost--lost. The Inspector
General Stuart Bowen said, ``The Coalition Provisional Authority did
not implement adequate financial controls.''
I ask unanimous consent that the April 19, 2006 article in the Wall
Street Journal by Yochi J. Breazen be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

[From the Wall Street Journal, Apr. 19, 2006]

Contractor Admits Bribing a U.S. Official in Iraq

lawyer uses civil war-era law to go after firms for corruption, but
administration won't help

(By Yochi J. Dreazen)

Orlando.--From his home office in a pink-painted mansion
here, lawyer Alan Grayson is waging a one-man war against
contractor fraud in Iraq.
Mr. Grayson has filed dozens of lawsuits against Iraq
contractors on behalf of corporate whistle-blowers. He won a
huge victory last month when a federal jury in Virginia
ordered a security firm called Custer Battles LLC to return
$10 million in ill-gotten funds to the government. The ruling
marked the first time an American firm was held responsible
for financial impropriaties in Iraq. But it also highlighted
the limits of the broader efforts to stem contractor abuses
there.
The False Claims Act that Mr. Grayson used in the Custer
Battles case is a Civil War-era statute allowing whistle-
blowers to sue contractors suspected of defrauding the
government and then keep a chunk of any recovered money.
There are an estimated 50 such cases pending against Iraq
contractors, including large firms like Halliburton Co.'s
Kellogg Brown and Root subsidiary. A technicality in the
statute, however, has allowed the Bush administration to
prevent the other lawsuits from moving forward. Cases filed
under the statute are automatically sealed, which means that
they can't proceed to trial--or even he publicly disclosed--
until the administration makes a formal decision about
whether to join them.
The law says such decisions are supposed to be made within
60 days, but with the exception of the Custer Battles case,
which it declined to join, the administration has yet to take
a position on any other suits, some of which were filed more
than two years ago. The law allows the Justice Department to
ask for extensions, which are almost always granted, for as
long as it sees fit. The department has kept the other False
Claims Act cases from proceeding by repeatedly asking for
extensions in each one.
That has left the cases in legal limbo, with lawyers like
Mr. Grayson unable to bring them to trial or detail them
publicly.
Contracting experts says previous administrations often
declined to join the False Claims Act lawsuits but that the
Bush administration's refusal to unseal the cases is
unprecedented. Justice Department spokesman Charles Wilson
says he can't discuss sealed cases or comment on why the
department has yet to act on them. ``All of the cases are
examined on their merits,'' Mr. Wilson says. With the Bush
administration sitting on the sidelines, primary
responsibility for pursuing the Iraq fraud cases rests with
plaintiffs' lawyers like Mr. Grayson, a Harvard-educated
lawyer who began his career defending federal contractors but
now makes his living going after them.
``With the sheriff asleep in the office, the only way you
get justice is with private lawyers like Alan Grayson willing
to step up and take down these fraudulent companies,'' says
Patrick Burns, the spokesman for the advocacy group Taxpayers
Against Fraud. ``Alan Grayson showed that you can do that
even without help from the government.''
Though it is unclear when the cases will proceed to trial,
Mr. Grayson is continuing to press ahead as best he can. He
and other lawyers in his firm travel the country taking
depositions, gathering documents and interviewing prospective
witnesses for the dozens of currently pending lawsuits. Mr.
Grayson says he also regularly passes information to the
federal investigators probing the cases and the prosecutors
deciding whether the government will participate in them.
A fierce critic of the war in Iraq, Mr. Grayson drives an
aging Cadillac emblazoned with antiadministration bumper
stickers such as ``Bush Lied, People Died, ``He says the
administration's botched handling of Iraq opened the door
for corrupt contractors to improperly reap fortunes there.
At a hearing in February 2005 held by Democratic senators,
Mr. Grayson asserted that the administration had ``not
lifted a finger to recover tens of millions of dollars our
whistle-blowers allege was stolen from the government.''
His opinions on the matter haven't shifted since. ``The
Bush administration has made a conscious decision to sweep
the cases under the rug for as long as possible,'' he says
today. ``And the more bad news that comes out of Iraq, the
more motivation they have to do so.''
For the contractors in his cross hairs, Mr. Grayson, 48, is
a formidable opponent. He received his undergraduate,
master's and law degrees from Harvard. He made millions
during a two-year stint as the president of IDT Corp., a
start-up that has since grown into one of the nation's
largest providers of discount telecommunications services.
Mr. Grayson says he has poured hundreds of thousands of
personal funds into his small eight-person law firm to help
defray the cost of pursuing Iraq fraud cases that may not
make it to trial for years. ``I have deep enough pockets to
subsidize the legal work,'' he says.
If he prevails, he might fill those deep pockets. Whistle-
blowers generally receive 30% of any penalty, although the
exact portion of every award is set by the judge in each
case. Lawyers like Mr. Grayson, in turn, receive 30% to 50%
of whatever the whistle-blowers get. ``It's really a
financial crapshoot,'' he says.
Mr. Grayson's firm switched its focus from working for
contractors to representing individual whistle-blowers
shortly after U.S. forces swept into Iraq in March 2003. He
says the firm made the move because they began to be
contacted by whistle-blowers who were referred by former
clients and others.
Two of his first clients were William D. Baldwin, a former
manager for Custer Battles, and Robert J. Isakson, a
construction subcontractor who had worked with the firm. The
company, run by a pair of politically connected military
veterans, had won security contracts in Iraq worth more than
$100 million. But the two men told Mr. Grayson that they had
evidence the firm was substantially overcharging the U.S.
occupation authority.
Mr. Grayson filed suit against the company under the False
Claims Act in February 2004, but it languished under seal
until that fall, when the Justice Department formally
declined to join the case. The government never explained its
decision. The case finally went before a judge in February.
After a contentious three-week trial, a federal jury on
March 9 found the company's two founders, along with a
business partner, guilty of using fake invoices from shell
companies to overcharge the authorities by millions of
dollars. The jury ordered the men to pay $10 million in
penalties, with Mr. Grayson's clients standing to receive
about $3 million of the money. Mr. Grayson declined to say
how much money he will be paid. David Douglass, a lawyer for
Custer Battles, says the company has appealed the verdict.
While waiting for the government to act on the other
lawsuits, Mr. Grayson is weighing a career change. HIs
congressional district is represented by a conservative
Republican, and Mr. Grayson is strongly considering seeking
the Democratic nomination to oppose him. He says his
campaign, if he chooses to run, would center on the war in
Iraq.
____

plea deal shows how businessman rigged bids for rebuilding hillah;
`considered it a free-fraud zone'

(By Yochi J. Dreazen)

In January 2004, Robert Stein, a senior U.S. contracting
official in Iraq, sent an unusual email to American
businessman Philip Bloom.
Mr. Stein wrote that he arranged for a new set of lucrative
rebuilding contracts to be awarded to Mr. Bloom, but wanted
the businessman to send his bid on the letterhead of a fake
company to avoid attracting attention in Baghdad. A few days
later, Mr. Bloom replied that he would ``bring with me the
dummies . . . I have five dummies per bid.''
The emails illustrate how closely U.S. officials on active
duty, like Mr. Stein, were willing to work with Mr. Bloom to
help him defraud the government through a massive bid-rigging
scheme in southern Iraq. They were released yesterday as part
of a guilty plea from Mr. Bloom, who admitted to steering $2
million in cash and other bribes to government officials in
exchange for $8.6 million in Iraqi construction and
demolition contracts. Mr. Bloom--who also admitted to
providing the officials with jewelry, first-class plane
tickets and sexual favors from women he employed at a villa
in Baghdad--faces as long as 40 years in prison and nearly $8
million in penalties.
The plea to charges of conspiracy, bribery and money
laundering is the latest to emerge from an investigation into
alleged corruption by American officials in Hillah, a restive
southern city. Mr. Stein, a former civilian occupation
official charged with overseeing $82 million in rebuilding
funds there, pleaded guilty on Feb. 2 to conspiracy, bribery
and using stolen government money to purchase an array of
high-powered rifles and grenade launders.
Lt. Col. Michael Wheeler and Lt. Col. Debra Harrison, who
both worked in Hillah, were arrested late last year and
charged with similar offenses; both are free on bond. Lt.
Col. Wheeler's attorney didn't return a call; Lt. Col.
Harrison declined to comment. Three other military officials
are mentioned in the court papers, and law enforcement
authorities say more arrests are likely. ``There

[[Page S6112]]

was no oversight anywhere near them at the time and they did
not believe they would be caught,'' says Special Inspector
General for Iraq Reconstruction Stuart Bowen, whose
investigators uncovered the ring. ``They considered if a
free-fraud zone.''
A variety of reports of congressional investigators and the
special inspector general for Iraq reconstruction have found
evidence that hundreds of millions of dollars were spent
without proper authorization, given to contractors who
performed shoddy work or paid to firms charging unreasonably
high prices. Large sums of money remain unaccounted for, and
auditors say they have little sense yet of how much may have
been stolen.
Previous court filings had detailed the broad outlines of
the conspiracy, which continued for almost two years. Mr.
Stein and the military officials submitted fake bids from
dummy companies for contracts that Mr. Bloom was seeking and
then awarded him the work as the low bidder. To evade
scrutiny, Mr. Stein--who had the authority to award contracts
of as much as $500,000--typically awarded contracts to Mr.
Bloom in amounts of as much as $498,900.
The new plea offered new evidence of how closely the two
men worked. In a separate series of early 2004 emails, Mr.
Stein warned the businessman that another U.S. official in
Hillah would demand a ``cut'' if he knew about the bid-
rigging arrangements. ``The fewer people who know what we are
doing the better,'' Mr. Stein wrote. ``I am your partner as
you put it so trust in me and what I feel.''
Mr. Bloom seemed willing to make Mr. Stein his partner in a
formal sense as well, In a Feb. 18, 2004, email, Mr. Bloom
told one of his employees that Mr. Stein was the ``vice
president of operations'' for the company and should get
whatever assistance he asked for. Mr. Stein, then a serving
government official, sent a note back asking that the firm's
business cards spell his name as Robert because ``it sounds a
bit better than `Bob.' ''
Mr. Stein, 50, who faces formal sentencing next month,
could receive a prison sentence of as long as 30 years,
although he is likely to receive far less because of his
cooperation with prosecutors.
No sentencing hearing has been set yet for Mr. Bloom, 65.
He had pleaded guilty in February and been cooperating with
prosecutors ever since, although the plea was only unsealed
Tuesday. John Nassikas, an attorney for Mr. Bloom, said he
had filed court papers asking for home detention during the
course of his dealings with the government and hopes Mr.
Bloom's ultimate sentence would be reduced because of his
cooperation.

Mr. HARKIN. This has had an extremely negative impact on our work in
Iraq. This fund was responsible for paying the salaries of hundreds of
thousands of government employees, such as teachers, health workers,
and government administrators; it supported the Iraqi defense and
police forces; and it helped repair Iraq's dilapidated infrastructure.
So the loss of $8.8 billion hurts our mission in Iraq.
There is real urgency to the spending issue. On Meet the Press
recently, we heard from retired GEN Barry McCaffrey, who just returned
from Iraq and who only last week advised the President and his national
security team at the White House on the situation in Iraq. He spoke
about the importance of spending our resources efficiently on Iraq
economic reconstruction. General McCaffrey said:

Unemployment is a bigger problem than the Iraqi insurgent
force. We spent $18 billion on economic reconstruction. There
is only $1.6 billion left in the pipeline. When the money
runs out, in my judgment, we just lost the war.

But money on a massive scale--$8.8 billion, as the inspector general
has said--has been ``lost into thin air.'' We can't account for it.
While this was not all U.S. money, it symbolizes the magnitude of the
corruption we are facing. We don't know where it has gone. Imagine the
critical things we could have done with that $8.8 billion to help win
the hearts and minds of the Iraqi people. This chart shows what the
Iraqi Relief and Reconstruction Fund goes for. I won't read them all,
but obviously security and law enforcement, the electric sector--they
are getting less electricity now than they did before the war started--
oil infrastructure, water resources and sanitation, roads and bridges,
health care, education; all of these things, $8.8 billion could have
gone for, but it didn't go for that. Where did it go? Well, we just
don't know.
The State Department's own numbers for this Iraq Relief and
Reconstruction Fund tell us they believe a lot can be done with this
amount of money. It could have paid for all of the security and law
enforcement training. It could have paid for all of the electric sector
programs. The waste of billions of dollars is bad enough, but the
widespread corruption is impeding our war effort; it is slowing
reconstruction efforts; it is denying our troops in the field the
quality support and equipment they deserve.
Just imagine how we could have utilized $8.8 billion to help our
military in the field. When our administration loses $8.8 billion that
was to have gone for reconstruction, then we have to replace that money
with our money. The reconstruction is taking place. If we don't restore
the unaccounted for money, no other country will. So we have to
appropriate U.S. taxpayer dollars to fill the void. Let me repeat that.
By this loss of $8.8 billion, if we don't account for it and somehow
recoup it, the reconstruction effort going forward will be made up by
taxpayers' dollars, our taxpayers' dollars.
Aside from that, how could we have used $8.8 billion to support our
own troops? Well, let's take a look at this. Here is the $8.8 billion
that we have lost. Equipment maintenance, about $3.2 billion; billeting
of soldiers, $2.4 billion; body armor, $1.9 billion; special pay for
hostile fire pay, family separation allowances, hardship duty pay, $1.3
billion. All of it could have been done with the $8.8 billion that is
lost. Let me repeat: $8.8 billion lost. It is not just a loss to our
Treasury and the taxpayers, it is as well a loss to our ability to keep
our own troops sustained.
The single most important legal tool that American taxpayers have to
recover funds stolen through fraud by U.S. contractors is the False
Claims Act. Indeed, thanks to this law, more than $17 billion has been
recovered on behalf of the American taxpayer. Under the False Claims
Act, whistleblowers are given a powerful incentive to come forward and
expose instances of fraud. The statute allows them to sue contractors
suspected of defrauding the government, and then they can keep a
portion of the recovered funds as a reward.
But there is a problem--a big problem. Scores of lawsuits have been
brought against contractors suspected of fraud in Iraq and Afghanistan,
including--and I will have more to say about this in a minute--a
Halliburton subsidiary, Kellogg, Brown, & Root. Yet the Department of
Justice has allowed only one of those suits to go forward in the
courts, and that lawsuit resulted in a major recovery of fraudulently
collected payments.
Given the massive amount of missing money, you would think that more
than just one lawsuit has been filed against corporate contractors. To
be sure, there are many more legitimate cases out there. Since 2003,
the Special Inspector General for Iraqi Reconstruction, the U.S. Army
Audit Agency, and the Defense Contract Audit Agency have all uncovered
contracting abuses related to the conflict in Iraq. Auditors of the
Defense Contract Audit Agency have found that Halliburton has charged
$1.4 billion in questionable and undocumented costs on just two
contracts. The auditors found $813 million in questioned costs under
Halliburton's Logistic Civil Augmentation Program contract to provide
support services to the troops. So here are two, right here: $813
million in ``questioned costs'' on Halliburton's--what they call the
LOGCAP contract, that is for Logistic Civil Augmentation Program; and
$382 million in ``unsupported costs.'' That is $1.195 billion just to
one company. That is Halliburton. That is Halliburton in ``questioned
costs.''

The auditors at the agency challenged most of these costs as
``unreasonable in amount'' after completing the audit action because
the costs ``exceeded that which would be incurred by a prudent
person.'' The auditors also found an additional $442 million in
Halliburton's charges are ``unsupported.'' As a result, Halliburton's
total ``questioned'' and ``unsupported'' costs exceed $1.4 billion.
So if you look here at the audits of Halliburton's Iraq contracts,
the ``questioned costs,'' the ``unsupported costs'' under these two
contracts, LOGCAP and RIO, if you add them up, combined it is $1.47
billion.
What is being done about this? Nothing. Nothing. The Department of
Justice is doing nothing.
There are numerous reports from former top Army contracting
officials, from former DOD officials, from soldiers on the ground, and
from former Halliburton and Kellogg, Brown & Root employees as to that
company's waste,

[[Page S6113]]

fraud, and abuse--numerous reports. There are reports that Halliburton
charged for meals never served, that Halliburton overcharged for oil
and oil delivery, that Halliburton overcharged and double-charged for
shipments of soda pop, that Halliburton overcharged on transportation
contracts. I could go on and on.
But for reasons that I cannot fathom, the Department of Justice has
not told Congress or the American taxpayer what it is doing to bring
these cases to justice. And it seems as though nothing is being done.
I believe we have an obligation to the American taxpayer to be
protected against theft or misuse of tax dollars by corrupt
contractors. Yet there is no evidence the Justice Department is doing
anything about it. So absent this information, I can only conclude that
nothing is being done about this corruption. If this is the case, then
the recovery of perhaps billions of dollars in taxpayer money is being
blocked.
While Congress and the American taxpayer remain in the dark about
what the Justice Department is doing to combat contract corruption,
False Claims Act cases continue to languish. The way it works is that
the False Claims Act cases are automatically sealed. They cannot go to
trial; they cannot be publicly disclosed until the Department of
Justice makes a decision of whether to join them. Under the statute,
these decisions are supposed to be made within 60 days. However, the
Department of Justice is allowed to seek additional time where needed.
This is appropriate because a lot of times these cases are very complex
and require extensive investigation. However, these extensions cannot
be allowed to become a form of indefinite delay, stretching out year
after year after year. And I fear that is exactly what is happening. As
I said, with just one exception, the Department of Justice has refused
to take a position on any of the lawsuits related to Iraq and
Afghanistan, some of which were filed over 3 years ago. Instead, the
Department files for and receives indefinite extensions.
As a result, as I said, with one exception, every single
whistleblower lawsuit has been effectively blocked by the Department of
Justice. Fraud has gone unpunished, billions of taxpayer dollars
continue to be squandered, and courageous whistleblowers who have come
forward, often at great personal risk, have been left in a sort of
legal limbo. As one attorney representing a whistleblower put it:

The Bush administration has made a conscious decision to
sweep the cases under the rug for as long as possible. And
the more bad news that comes out of Iraq, the more motivation
they have to do so.

This situation is unacceptable. So my amendment would therefore
require the Justice Department to report to Congress on a semiannual
basis the efforts it is undertaking to ensure that it is investigating
in a timely and appropriate manner all claims of contractor waste,
fraud, and abuse related to the U.S. Government's activities in Iraq
and Afghanistan. It would require the Department of Justice to report
on similar executive branch interagency efforts. My amendment would
prevent the Department of Justice from imposing undue secrecy on false
claims civil actions related to Government spending in Iraq and
Afghanistan by simply requiring the Department of Justice to tell
Congress what it is doing to combat this corruption. Sharing this
information with Congress is nothing out of the ordinary, but it is
long past due. As a matter of good faith to our troops and to the
American taxpayer, we need to move aggressively against corruption and
war profiteering in Iraq, Afghanistan, and elsewhere. These cases have
gone on too long.
In closing, I quote the British philosopher John Stuart Mill who
said: ``The proper office of a representative assembly is to watch and
control the government.''
Mr. President, hopefully this is a nonpartisan amendment. It is all
about enabling Congress to provide meaningful oversight of executive
branch activity consistent with our duty to do so under the
Constitution and the law. It will enable Congress to know the
administration's plans for rooting out contractor corruption in Iraq,
Afghanistan, and elsewhere, and I urge my colleagues to support the
amendment.
Mr. President, I yield the floor.

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