US Army shipped $12 billion to Iraq -- cash

Not too long after 9/11, the Canadian government quietly passed a regulation that makes it illegal to write a cheque for five million dollars or more. Now, anyone in their right mind would not do so in the first place ... but in the era of wire transfers it simply is not necessary to carry all that much cash or negotiable instruments. So when you see someone at the 6/49 getting their "cheque" and posing for the cameras, rest assured it's already been deposited electronically in their bank accounts after the safeguards that are supposed to be in place now are carried out.

So how to explain that the US military had been helping the Coalition Provisional Authority (CPA) -- that is, the puppet government run by the States before power was handed over to the new Iraqi government -- by shipping cash, 363 tons on pallets worth a total of over $12 billion, to help them get off their feet after Saddam Hussein was overthrown? In one shipment, C-130 planes delivered over $2.4 billion in $100 bills -- in sequence, of course. And according to the chair of the Oversight and Government Reform Committee, Henry Waxman (D-CA), there was absolutely no controls over the security arrangements or to make sure the money got into the right hands.

Convenient. One key to a vault was in a backpack, according to investigators. A contractor got $2 million in a duffle bag with no indication how the money was going to be spent. Public servants who were supposed to get paid weren't. And the clincher: Rather than hiring a respected auditing firm, the CPA got the services of someone who worked out of his home. Now, no one knows exactly how the provisional government spent any of the money transferred to it -- about $20 billion in total.

To put that in perspective, consider that the US Department of Energy spent $23.4 billion last year; Housing and Urban Development $28.5 billion. Last time I checked, the IRS doesn't hire armoured trucks to deliver that kind of money, even across town in DC -- it's wired over to the respective departments on a pay as you go basis.

People went nuts when a hundred million was stolen from the Department of Agriculture to fund Gerard Bull's zany idea for a "supergun." Yet in the middle of a war that has already fallen out of disfavour with most Americans, what's $12 billion among friends, eh? It's little wonder there is a civil war in Iraq right now. It would have happened anyway, quite honestly.

But there should have been first principles: The money should have been transferred over properly and handed out with the same kinds of safeguards that exist in the West. Had the civil service been paid on time, for example, the army and police could have been trained by now and the insurgency contained if not eliminated; and hospitals wouldn't have be running out of even the most basic essentials.

I expect this investigation will only widen into a full accounting of what the contractors were doing and where the money all went. And I also expect when the sub poenas are issued, the answer will be the same from Paul Bremer on down: "On the advice of my attorney, I assert my Fifth Amendment rights."

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