Senators seek audit of Iraqi oil money

Two senior members of the Senate Armed Services Committee have requested a full accounting of how Iraq is spending its soaring oil revenues, amid conflicting estimates of how much the country has invested in rebuilding its broken infrastructure and providing basic services to its citizens.

Addressed to David Walker, the top official at the U.S. Government Accountability Office, the request, sent Friday, begins with the estimate that Iraqi oil revenues could skyrocket above $56 billion in 2008, largely because of the rising price of crude.

That enormous influx of cash comes as the United States has been cutting back spending on reconstruction. Close to $50 billion in U.S. taxpayer money has been invested in reconstruction since the invasion, but the program has achieved at best mixed results when measured by improvements in the lives of Iraqi citizens.

In spite of the dire need for better health care, more electricity and clean water, a functioning sewage system and other services, the GAO, which is charged with overseeing the Iraqi government’s finances, has estimated that Iraq spent only 22 percent of the oil money set aside for reconstruction in 2006. In January, the GAO reported that Iraq had spent just 4.4 percent of its 2007 reconstruction budget by August of that year, the most recent figures available at the time.

Bush administration and Iraqi governmental estimates of the expenditures have been far higher. But whatever the exact figure, the fact remains that basic services in Iraq measured by hours of electricity, gallons of potable water or quality of health care have scarcely improved.

As a result, the letter from the Armed Services Committee says, “we believe that it has been overwhelmingly U.S. taxpayer money that has funded Iraq reconstruction over the last five years, despite Iraq earning billions of dollars in oil revenue over that time period that have ended up in non-Iraqi banks.”

The letter was signed by Sen. Carl Levin (D-Mich.), the committee chairman, and Sen. John Warner (R-Va.), a former chairman. Sen. John McCain of Arizona, the presumptive Republican nominee for president, did not sign the letter, even though he is the ranking Republican on the committee.

Iraqi officials say they face numerous obstacles in what might seem to be a straightforward task: spending their plentiful money. Workers are attacked, engineers and contracting experts have fled government ministries, construction companies refuse to take jobs in risky areas and building materials are not available.

The letter by Levin and Warner requests detailed information on the size of Iraqi oil revenues from 2003 to 2007, how much of that money has gone unspent, and “how much money does the Iraqi government have deposited, in which banks, and in what countries?”

The letter also asks, “Why has the Iraqi government not spent more of its oil revenue on reconstruction, economic development and providing essential services for the Iraqi people?”

Mass grave: In Diyala province, where sectarian violence is still common, Iraqi security forces discovered a mass grave Friday with the remains of about 100 people, said Army Maj. Winfield Danielson, a spokesman for Multinational Forces-Iraq.

The remains were skeletal, indicating that they had been there for some time, Danielson said, adding that no information was yet available on who was responsible for the killings.