Featured Research
100 Largest US Defense Department Contractors By Revenue

08.Apr.2012
State Lawmaker Accused Of Diverting Contract Money To GOP Candidates

I came across an interesting story recently about Brian Boquist, a conservative Oregon legislator who also runs a hot-zone aviation business and a military training range, both of which operate on variations of the name ICI, or International Charter, Inc. One of Boquist’s partners in ICI, a helicopter pilot, made some pretty startling allegations in a lawsuit filed in January:

The complaint was filed this Jan. 31 in U.S. District Court in Oregon by former ICI vice president and co-owner Danny O’Brien and his wife, Lorrie, who live in Lakewood, Wash. The lawsuit names Boquist; his wife, Peggy; and their business partner, Marcus Hines of Arizona, as defendants.

The complaint says Boquist forced the O’Briens out of the firm, ICI Wyoming, at the end of last year, following a disagreement over the direction of the company.

After Boquist forced the O’Briens out, the complaint says, the company’s bookkeeper resigned. The bookkeeper, lawsuit says, then provided the O’Briens with evidence that Boquist and his wife had been secretly diverting money from the firm to other projects, including a new company they had started in 2008 called Powder River Cartridge Company, LLC.

Through this new company, the complaint says, “the Boquists directed thousands of dollars of revenue generated by ICI Wyoming to their own use and without [the O'Briens'] knowledge or consent, including but not limited to political campaign contributions for causes supported or advocated by Defendant Brian Boquist, in his capacity as an Oregon State Senator.”

I followed up this news in another article for WW, which explained in greater detail how Boquist makes his money, but I never heard back from any of the plaintiffs. Nick R. Martin at Talking Points Memo also followed up, but succeeded only in obtaining a cryptic comment from Boquist’s wife.

31.Jan.2012
Americans In Afghanistan Likely Causing More Corruption Than They Stop

Forget the Republican primaries. What do the polls say in Afghanistan?

“Afghans themselves see corruption as pervasive; it affects nearly every aspect of their lives and leads to security concerns, limited economic development, and human rights abuses…”

“[A] large majority of Afghans (76%) see corruption as a major problem in the country; only 5% said it was not a problem…

Corruption frequently affects Afghans in their daily life: 56% saw it as a major daily problem…”

Assuming this survey is accurate, that works out to roughly 17.3 million Afghans who personally deal with corruption on a daily basis.

Also assuming, as the survey indicates, that perceived corruption in Afghanistan takes the form of bribery about 17 percent of the time, one can venture a wild, unscientific guessestimate of the number of bribes that Afghans are asked to pay every year.

That number is just north of 1 billion, or approximately 3 million bribes a day.

I can hear the statisticians screaming. These are huge assumptions. Trying to put a number on bribery in one of the world’s most corrupt countries using a public opinion survey is about as reliable as asking teenagers how often they masturbate. But the surveys do give some sense of scale.

All the information above is quoted from a report released today by U.S. military auditors. The report, a quarterly update from the Office of Special Inspector General for Afghanistan Reconstruction, also offers some numbers on the work it did to tackle that corruption problem during the last three months of 2011.

Here are a few “accomplishments” the office thought noteworthy:

• completed three audits…
• participated in investigations that resulted in two individuals sentenced for bribery…
• referred 40 individuals and companies for suspension and debarment
• opened 20 new investigations…

SIGAR, as this auditing office is known, has a staff of 133. That’s clearly not enough to cover a war that’s costing U.S. taxpayers more than $2 billion a week. And many government and military auditors are honest, dedicated people doing the best they can in a bureaucracy that can bring tremendous pressure to bear against them.

That said, even the most cash-strapped, podunk county prosecutor’s office would be embarrassed by these numbers. Three audits completed. Two bribery convictions. Three million bribes a day.

No wonder “Afghans also said that ISAF and international development partners need to play larger roles in efforts to address the problem.”

The report is titled “10 Years of Reconstruction,” as though what it contains were somehow worth celebrating. In it, the word failure appears 7 times. The word progress appears 81 times.

What the auditors, however well-meaning, cannot say is that the International Security Assistance Force—which brings boatloads of American dollars into the country, and tries to make legitimate statesmen out of guys who are essentially gang leaders—plays a large role in enabling corruption in Afghanistan.

To wit, here’s another “important development” the report offers as a sign of progress:

[T]he MoM awarded China National Petroleum Corporation International (CNPC) the rights to develop three oil blocks in the Amu Darya Basin in the north. The MoM estimated that the basin contains more than 80 million barrels of crude oil reserves, plus a potential of 80 million barrels in yet-to-be discovered reserves. CNPC agreed to pay the government a 15% royalty and has partnered with Watan Oil and Gas Afghanistan Ltd. to begin production within a year.

The U.S. Army banned Watan Oil and Gas from receiving contracts a full two years ago for—you guessed it—corruption! Its security affiliate, Watan Risk Management, is affiliated with some notorious relatives of the U.S.-backed President, Hamid Karzai. Now that the Chinese are paying them, instead of the Americans, everything is presumably above-board.

Progress!

18.Jan.2012
New U.S. Nuke Facility Shows One Way Military Costs Get Hidden

The Project on Government Oversight in Washington, D.C. today released a report asking the U.S. Congress and the Obama administration to kill a $6 billion nuclear weapons project in Los Alamos, New Mexico.

You can read POGO’s report online here. A couple of years ago, while living in New Mexico, I wrote a primer on this project for the Santa Fe Reporter, which remains online here.

It seems odd, doesn’t it? How did a $6 billion nuclear weapons program—a program, as POGO notes, that seems at odds with Obama’s stated nukes policy—slip by without mention during the recent debate over military spending? Aren’t nuclear weapons, after all, the constant preoccupation of all foreign and national security thought—not just within the U.S., but around the world?

In the shallowest sense, the omission is understandable, considering how amazing it is that there was such a debate at all, given the militaristic drift of the past decade.

But ultimately I believe there’s one overarching reason why you’ve probably heard little to nothing about this project: Language. Specifically, the language of obfuscation.

The nuke lab in question will be run by the Department of Energy, not the Department of Defense. This is a longstanding bureaucratic fact of the U.S. nuclear weapons complex, but nonetheless similar to the shell game whereby the costs of American private security contractors in Iraq shifted to the Department of State prior the withdrawal of military ground forces.

It’s also not called a nuke lab. Instead, it’s euphemistically described as a “chemistry and metallurgy” facility—still awake?—and a “replacement” one at that. So it’s not even really new, you see!

I could be wrong, of course. It could be that Americans really do care about the development of nuclear weapons—just not their own.