February 7, 2007

WASHINGTON -- House Democrats, taking charge of investigations now that they control Congress, grilled the former U.S. occupation chief in Iraq on Tuesday about the way he doled out billions of Iraqi dollars without accounting for the money.

L. Paul Bremer III, with support from Republicans, fired back by insisting he did the best he could in the middle of a war and repeating over and over that he was spending Iraqi -- not U.S. -- money.

The hearing by the House Committee on Oversight and Government Reform scrutinized the chaotic days that began after a burning and looted Baghdad fell to U.S. troops four years ago. Bremer ran the country for 14 months.

However, the days of the Coalition Provisional Authority seemed like a distant past compared with a simultaneous Senate hearing -- where Defense Secretary Robert Gates spoke of the situation today, including the hope of a U.S. troop withdrawal before year's end.

The significance of the House hearing came when Oversight and Government Reform Committee Chairman Henry Waxman, D-Calif., promised two years of investigations of fraud, waste and abuse on the Bush administration's watch.

Democrats are planning dozens of investigations, many of them in Waxman's committee, which scheduled further hearings this week on homeland security contracts and drug prices.

Bremer Defended

The hearing presented two divergent views of what financial controls were possible in an Iraqi capital with no functioning national government.

Waxman and a hearing witness, special inspector general for Iraq Stuart Bowen Jr., criticized Bremer for failing to install accounting systems that would have forced Iraqi ministries to account for up to $12 billion in Iraq's funds. The money came from a United Nations Oil For Food program and seized Iraqi assets, but fell under Bremer's control.

"Without strong standards, we have no way of knowing whether the cash could end up in enemy hands," said Waxman.

Bremer countered, "I arrived in Baghdad at a time when much of the city was burning. Looting was still widespread. My responsibilities were to kickstart the economy."

Former committee chairman Tom Davis, R-Va., now the senior minority member, defended Bremer and criticized Waxman.

He said Waxman was rushing to "old judgments" in a hearing that was "old news."

Bowen, responding to Bremer's assertions that he was operating without a functioning Iraqi government, said, "That situation screams for more oversight, more controls." But the inspector general told the hearing he couldn't say whether insurgents got any of the funds.

Bremer painted the bleakest possible picture of the situation he faced.

Looters were running wild. Buildings were burning. Competent government officials had fled or were on the run. Civil servants had not been paid for months. Banks were closed and only cash would keep the economy from total collapse.

Tons Of Cash Flown To Baghdad

Waxman said up to $12 billion in Iraqi money was converted to dollars, held in the Federal Reserve Bank in New York and shipped in pallets to Baghdad that totaled 363 tons.

"Millions of Iraqi families depended on civil service salaries and pensions," Bremer said. "It was clear we had to get this Iraqi money in the hands of people immediately."

Bremer acknowledged that he and the U.S. government made mistakes. He said he mistakenly described the Iraqi Army as being disbanded -- leaving an incorrect impression because "there was not a single unit of the Iraqi army standing in place. "

He said too many government workers were fired because he mistakenly let Iraqis carry out his policy of dismissing only 1 percent of the government officials under Saddam Hussein.

And Bremer said he believed from the start that the best way to provide security was to increase the number of U.S. troops beyond the numbers sent to Iraq.

Cost Of War Detailed

In related news, the Department of Defense said Monday that the war on terrorism has cost $545 billion to date.

Pentagon Comptroller Tina Jonas told reporters that Congress has appropriated $452 billion for the war on terrorism via emergency supplemental budget measures.

Another $3 billion has been appropriated for Operation Noble Eagle, the mission providing a combat air patrol over the continental United States and security at airports that started after the terrorist attacks of Sept. 11, 2001, she said.

The comptroller said the department is asking for another $93.4 billion as part of the emergency supplemental request for 2007.

She projected $141.7 billion in operational expenses in fiscal 2008. This will bring the total for the war on terrorism to about $690 billion.

Copyright 2007 by The Associated Press.