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Old 01-06-2007, 05:58 AM   #1 (permalink)
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Maybe...this time

Second times a charm....personally I see this as a great Idea, and I hope it passes this time. Might even save me a few Bucks in taxes a couple decades from now.

"Many Democratic Senators joined Leahy in reintroducing a bill creating criminal penalties for war profiteers and cheats who would exploit taxpayer-funded efforts in Iraq and elsewhere around the world. The War Profiteering Prevention Act of 2007 builds on earlier efforts by Leahy, who is also a senior member of the Appropriations Committee, to crack down on this type of rampant fraud and abuse. It is similar to legislation Leahy introduced in 2003, that was subsequently passed by the Senate as part of an appropriations bill but later torpedoed by the White House and the House Republican leadership, which stripped out the Leahy provision. "

http://leahy.senate.gov/press/200701/010407b.html
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Old 01-06-2007, 06:03 AM   #2 (permalink)
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But isn't graft the American way?
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Old 01-06-2007, 07:13 AM   #3 (permalink)
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*sniffs around* Does anyone else smell veto in here? I think this should be publicised more so that if it is smacked down people will know about it... and the one person to blame. But yea its a great idea and long over-due. I have heard some amazing stories of waste by contracted US companies in Iraq... hopefully this will change that.
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Old 01-06-2007, 09:09 AM   #4 (permalink)
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This is a great start. Now if they can just extend this to all taxpayer funded activities including those taking bribes and campaign contributions from the profiteers. They should probably also include those in Congress who get their extended families and friends jobs in the profiteering companies.

After all, Leahy said "Americans want the culture of corruption to end". I suspect when the smoke clears not many of his colleagues would be left.
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Old 01-06-2007, 09:46 AM   #5 (permalink)
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never gonna happen. the politicians love their extra money a bit too much to ever get money out of politics.
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Old 01-06-2007, 09:54 AM   #6 (permalink)
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I always thought war profiteering was considered a treasonous act. Am I entirely ignorant on this subject? I'm obviously too damn lazy right now to research it.
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Old 01-07-2007, 12:17 PM   #7 (permalink)
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Quote:
Originally Posted by Charlatan
But isn't graft the American way?
Yes, of course, Canadians never heard of it.

Nice troll, moderator.
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Old 01-07-2007, 12:38 PM   #8 (permalink)
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Quote:
Originally Posted by Marvelous Marv
Yes, of course, Canadians never heard of it.

Nice troll, moderator.
Is this your way of saying that lobbying and stock options have not become institutionalized graft?

Sure, other people have it too, but that doesn't make your one-liner into a point.
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Last edited by ubertuber; 01-07-2007 at 12:40 PM..
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Old 01-07-2007, 12:57 PM   #9 (permalink)
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Profit made by others is wrong. Profits made by me are o.k. Isn't that really what this boils down to? The government controls and regulates commerce, they control defense spending. Perhaps all that is needed is for them to do their jobs, we don't need more laws and empty political statments.

I think we generally know the target of this is Haliburton. When Haliburton was a government supplier, making a profit, 40 years ago (and every year since), that was o.k. Now under the Bush administration they are profiteering and have been for the last 6 years, everyone has known about it, they continue doing it, and Congress and the military sit back and do nothing. I am looking forward to the hearings and for the facts to come out. But let me be the first to go on record here to say nothing is going to come of this. I think the facts will show Haliburton was not profiteering.
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Old 01-07-2007, 01:47 PM   #10 (permalink)
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Quote:
Originally Posted by aceventura3
I think the facts will show Haliburton was not profiteering.
So driving empty trucks around Iraq so you can bill the government huge amounts of money is not profiteering? How about replacing an entire semi because it blew a tire? How about charging $45 for a 12 pack of coke bottled in Kuwait?
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Old 01-07-2007, 03:14 PM   #11 (permalink)
 
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Quote:
Originally Posted by aceventura3
I think the facts will show Haliburton was not profiteering.
The Defense Contracting Auditing Agency (DCAA), the Special Inspector General for Iraq Reconstruction (SIGIR) and the Government Accoutabilibty Office have indepedently identified more than $1 billion in questionable Halliburton (and subsidiarty KBR) overcharges in Iraq.

The DCAA on several occasions recommended withholding payments on some Halliburton contracts pending support documentation from Halliburton. Rumsfeld ignored the DCAA recommendations.

In Congressional oversight hearings of Iraq reconstruction funding abuses over the last three years, the Repub majority repeatedly refused the request by Dems on the committees to subpoena Halliburton for supporting documents. The latest request was last Feb (link)

Other DCAA audits: http://reform.house.gov/search/resul...ts+halliburton

Ace....perhaps you are right (although the audits suggest otherwise), and now that we finally have a Congress that takes its oversight responbilities seriously, we shall see in the coming months.
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Old 01-07-2007, 03:35 PM   #12 (permalink)
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Quote:
Originally Posted by aceventura3
I think we generally know the target of this is Haliburton. When Haliburton was a government supplier, making a profit, 40 years ago (and every year since), that was o.k. Now under the Bush administration they are profiteering and have been for the last 6 years, everyone has known about it, they continue doing it, and Congress and the military sit back and do nothing. I am looking forward to the hearings and for the facts to come out. But let me be the first to go on record here to say nothing is going to come of this. I think the facts will show Haliburton was not profiteering.
During the vietnam war there was an airforce guy in congress who at the very least vocalized the desire to reign in profiteering by KBR(i think it was KBR). That man's name was donald rumsfeld.
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Old 01-07-2007, 05:19 PM   #13 (permalink)
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Quote:
Originally Posted by aceventura3
I think the facts will show Haliburton was not profiteering.
I find myself in open mouthed shock at this statement from you. There is growing evidence from government sources that Haliburton's billings are not mere billing errors. What facts have you seen, Ace, that would support this claim?
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Old 01-07-2007, 05:44 PM   #14 (permalink)
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Quote:
Originally Posted by Elphaba
I find myself in open mouthed shock at this statement from you. There is growing evidence from government sources that Haliburton's billings are not mere billing errors. What facts have you seen, Ace, that would support this claim?
The US invasion of Iraq began on March 17, 2003:
<center><img src="http://chart.finance.yahoo.com/c/5y/h/hal"></center>

Here is how war profiteering and gross government incompetence was dealt with during WWII...it's a five page article, too bad the regime and the DOD didn't read it, and that the congress was controlled, from 2003 to Jan. 2007, by one, totally partisan, pro-corporation, pro-privatization, political party:
Quote:
http://www.time.com/time/magazine/ar...774390,00.html

From the Magazine | U.S. At War
Billion-Dollar Watchdog
SUBSCRIBE TO TIMEPRINTE-MAILMORE BY AUTHOR

Posted Monday, Mar. 8, 1943

(See Cover)

Anywhere but in a democracy, the Senate's irreverent Truman Committee would be fair game for liquidation. In a perfect state, free from butterfingers and human frailty, it would be unnecessary. In the U.S., democratic but far from perfect, the Truman Committee this week celebrated its second successful birthday as one of the most useful Government agencies of World War II.

Had they had time, its ten members might have toasted their accomplishments all night. They had served as watchdog, spotlight, conscience and spark plug to the economic war-behind-the-lines. They had prodded Commerce Secretary Jesse Jones into building synthetic-rubber plants, bludgeoned the President into killing off doddering old SPAB and setting up WPB.

They had called the turn on raw-materials shortages, had laid down the facts of the rubber famine four months before the famed Baruch report. One single investigation, of graft and waste in Army camp building, had saved the U.S. $250,000,000 (according to the Army's own Lieut. General Brehon B. Somervell). Their total savings ran into billions, partly because of what their agents had ferreted out in the sprawling war program, partly because their hooting curiosity was a great deterrent to waste.

The Truman Committee was too busy to celebrate. In its 16th month of war, the U.S. had still not digested some of war's first readers. The first annual Truman report, with its shocking evidence of all-around bungling (TIME, Jan. 26, 1942), had not spelled the end of bungling. This week the Committee worked on its second annual report, which would have to recite much the same story, chastise many of the same men, pose some of the same old problems. How big should the Army be? How could the manpower tangle be solved? Where would the nation get its food this year? What was wrong with WPB?

Over these basic questions, which the Truman Committee, on behalf of all American citizens, had hoped would be solved two years ago, the committee still sweated, glowed and tried to shed light.

Closest Thing Yet. The bigger the U.S. arsenal grew, the more important the Truman Committee became. As the arsenal turned into a modern-day Great Pyramid, most Washington officials still lugged just one stone, and many carried it in the wrong direction.

The closest thing yet to a domestic high command was the Truman Committee. Its members had no power to act or order. But, using Congress's old prerogative to look, criticize and recommend, they had focused the strength of public opinion on the men who had the power. They had a fund of only $200,000 (some still unspent) only twelve investigators, 18 clerks and stenographers. But it was an obscure war plant that had never been visited by the committee. Its members had heard hundreds of witnesses, taken 4,000,000 words of testimony. With battle-royal impartiality, they had given thick ears and red faces to Cabinet members, war agency heads, generals, admirals, big businessmen, little businessmen, labor leaders.

Page 1 of 5 1 | 2 | 3 | 4 | 5 Next >>
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Old 01-08-2007, 06:18 AM   #15 (permalink)
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First - There needed to be a pre-defined standard for profiteering. I don't think there was. If so, please give a source.

Second - contracts entered into between Haliburton and the government, either bid or no bid were entered into mutually. Haliburton did not have the power to force the government into poor contracts.

Third- Some Haliburton contracts existed with the government prior to the Iraqi war.

Fourth - This issue has been on the table for 6 years. Why has no action been taken if the law was broken?

Fifth-Haliburton is a diversified company. Defense contracting is only a small percentage of the total business (part of which was spun off recently, although Haliburton still has a controlling interest). The stock price mirrors the stock price of many companies in the energy business during the period shown above.

So, I am on record. If I am wrong, I am wrong for all to see.

Quote:
Originally Posted by dc_dux
The Defense Contracting Auditing Agency (DCAA), the Special Inspector General for Iraq Reconstruction (SIGIR) and the Government Accoutabilibty Office have indepedently identified more than $1 billion in questionable Halliburton (and subsidiarty KBR) overcharges in Iraq.

The DCAA on several occasions recommended withholding payments on some Halliburton contracts pending support documentation from Halliburton. Rumsfeld ignored the DCAA recommendations.

In Congressional oversight hearings of Iraq reconstruction funding abuses over the last three years, the Repub majority repeatedly refused the request by Dems on the committees to subpoena Halliburton for supporting documents. The latest request was last Feb (link)

Other DCAA audits: http://reform.house.gov/search/resul...ts+halliburton

Ace....perhaps you are right (although the audits suggest otherwise), and now that we finally have a Congress that takes its oversight responbilities seriously, we shall see in the coming months.
I guess the question is going to boil down to - how does a business account for doing business in a war torn country?

If you ever had the experience of doing business in a foriegn country your perspective may be different. For example if you travel or need to ship goods across certain boarders you have to bribe officials. How do you account for that in a legitimate way on an expense report? You can't, but it is a real cost. I can only imagine what it took under the table to get things done in Iraq. I think that will be the reason Congress won't make a big deal about this. They can't want this to see the light of day, it is a reality and will be in the future no matter who was or will be in the White House.
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Last edited by aceventura3; 01-08-2007 at 06:30 AM.. Reason: Automerged Doublepost
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Old 01-08-2007, 06:44 AM   #16 (permalink)
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I'm just responding to the most egregious ostrich-head-burying here:

Quote:
Originally Posted by aceventura3
Second - contracts entered into between Haliburton and the government, either bid or no bid were entered into mutually. Haliburton did not have the power to force the government into poor contracts.
But it had the power to "lobby" (read: bribe) its way into contracts that were vastly favorable to them and vastly unfavorable to the American people and the American soldiers.

Quote:
Originally Posted by aceventura3
Fourth - This issue has been on the table for 6 years. Why has no action been taken if the law was broken?
Because they've had congress and the white house in their pockets? Hello: a former CEO is the freaking VPOTUS, for god's sake. Ethics? Who needs 'em! They've got buddies in Washington!

Quote:
Originally Posted by aceventura3
The stock price mirrors the stock price of many companies in the energy business during the period shown above.
Uh hunh. The same energy companies that have been investigated for windfall profits and opportunistic pricing? The same energy companies who have successfully lobbied for governmental protection while making these record profits? I'm not real sure you want to be making that comparison. Doesn't really help your case.

Quote:
Originally Posted by aceventura3
So, I am on record. If I am wrong, I am wrong for all to see.
I guess it's no mystery what I think about that...
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Old 01-08-2007, 07:02 AM   #17 (permalink)
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Quote:
Originally Posted by aceventura3
I can only imagine what it took under the table to get things done in Iraq. .
Me too! ....it just makes me want to puke.
And look what "got done"! Gee....Our economy sucks big time, and the rest of the world hates us now, the mideast is scarily unstable... take it to the bank dudes ......
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Old 01-08-2007, 07:58 AM   #18 (permalink)
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Quote:
Originally Posted by Lizra
Me too! ....it just makes me want to puke.
And look what "got done"! Gee....Our economy sucks big time, and the rest of the world hates us now, the mideast is scarily unstable... take it to the bank dudes ......
Many in the world hated us before the war. Some hated us so much that they declared a "holy war" on us. Our economy is doing pretty well by most measurements. The mieast has been unstable for a long long time. Do you think if we left the middle east tomorrow, everything would be o.k.? If that were all it took, lets leave, but most reasonable people know that it is much more complicated than that.

Quote:
Originally Posted by ratbastid
I'm just responding to the most egregious ostrich-head-burying here:
You say my head is in the sand, but you seem to think that $45 for a case of coke was actually $45 for a case of coke. I ask the question, how do you account for doing business in war torn Iraq? That is a legit question. I don't like it, but I don't ignore the realities of doing business in undesirable places. If Haliburton is doing what needs to be done, perhaps the government should not have put the company in that position rather than making politically charged statments.


Quote:
But it had the power to "lobby" (read: bribe) its way into contracts that were vastly favorable to them and vastly unfavorable to the American people and the American soldiers.
Haliburton lobbies congress as does every other major corporation. If your position is that government is incompetent, why blame Haliburton? Why not hold congress accountable.

Quote:
Because they've had congress and the white house in their pockets? Hello: a former CEO is the freaking VPOTUS, for god's sake. Ethics? Who needs 'em! They've got buddies in Washington!
Haliburton controls the government? O.k...., yea right.


Quote:
Uh hunh. The same energy companies that have been investigated for windfall profits and opportunistic pricing? The same energy companies who have successfully lobbied for governmental protection while making these record profits? I'm not real sure you want to be making that comparison. Doesn't really help your case.
There is a difference between being investigated and being guilty of breaking the law. If energy companies broke the law making their profits, they should be held accountable. We know the only reason congress had hearing was to grand-stand for the voters back home when gas was over $3/gallon. Other than having hearings did anything actually happen? Oh, wait - the price went down due to natural market forces, andit had nothing to do with congress.


Quote:
I guess it's no mystery what I think about that...
Time will tell.
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Last edited by aceventura3; 01-08-2007 at 08:18 AM.. Reason: Automerged Doublepost
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Old 01-08-2007, 12:04 PM   #19 (permalink)
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Quote:
Originally Posted by aceventura3
You say my head is in the sand, but you seem to think that $45 for a case of coke was actually $45 for a case of coke.
I know that everyone who disagrees with you eventually turns into a big blur, but I was actually not the person who said that. Of the things Haliburton has been accused of doing, that's the one I can sort of see their side of. It's not like a big red coke truck can run between the Baghdad airport and the Green Zone. So let's not put words in my mouth, hm?

Quote:
Originally Posted by aceventura3
I ask the question, how do you account for doing business in war torn Iraq? That is a legit question. I don't like it, but I don't ignore the realities of doing business in undesirable places. If Haliburton is doing what needs to be done, perhaps the government should not have put the company in that position rather than making politically charged statments.
I don't understand that last sentence. Nonetheless:

Quote:
Originally Posted by aceventura3
Haliburton lobbies congress as does every other major corporation. If your position is that government is incompetent, why blame Haliburton? Why not hold congress accountable.
We did. They were called Midterm Elections. Much of the anti-Republican (really anti-Incumbent) backlash was from America being sick and tired of lobbyists running the government. That's really all that's happening here.

Quote:
Originally Posted by aceventura3
Haliburton controls the government? O.k...., yea right.
Scoffing doesn't constitute evidence or argumentation.

Can you deny that the company that has most been accused of war profiteering has a former CEO in the White House? Can you honestly say that the money they've pumped into congresspeople's re-election campaigns has been because they're friendly and helpful?

Haliburton has been given massive and overloaded no-bid contracts on the whole war-rebuild effort. Is that because there's no competition? Or is it because they're the most favored firm of their type? And if it's because they're the most favored... why do you think that might be?
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Old 01-08-2007, 12:24 PM   #20 (permalink)
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<b>If you jump down and read the last quote box in this post, and my comments after it, would you not be inclined to want to impeach the creators of the CPA for fraud against US taxpayers, or for stupidity....can anyone make a case for an alternate reaction to the August court ruling?</b>

The Iraqi government is about to sign contracts with big oil companies that will allow the companies to keep as much as 75 percent of the profits from the sale of Iraqi oil, in the first few years of contracts that will last as long as 30 years:
Quote:
http://news.bbc.co.uk/1/hi/programme...ht/4354269.stm

Last Updated: Thursday, 17 March, 2005, 15:41 GMT
Secret US plans for Iraq's oil
Quote:
http://www.cbc.ca/world/story/2007/01/08/iraq-oil.html
<b>Iraq to give Western companies control of oil: report
Last Updated: Monday, January 8, 2007 | 12:29 PM ET
CBC News</b>
<b>Because the Bush administration created the CPA and funded much of the contracts awarded to private companies in the first few years of the US occupation of Iraq, a federal judge, in August, overturned the fraud convictions and the $10 million judgments against contract "Custer Battle", because, under the provisions of the US Fair Claims Act, the US government was not technically defrauded, because the CPA, headed by Bush crony, "Jerry" Bremer, until June 28, 2004, was not an agency of the US government. This is explained in the last quote box. Apparently, no provision for accountability by a US agency was "built" into the fraud scheme that was the US created CPA !!!!!!!</b>
Quote:
http://www.csmonitor.com/2005/0317/p06s01-wogi.html
from the March 17, 2005 edition

Why graft thrives in postconflict zones
A report issued Wednesday said Iraq could become 'the biggest corruption scandal in history.'

.....A January report by special inspector Stuart Bowen found that $8.8 billion dollars had been disbursed from Iraqi oil revenue by US administrators to Iraqi ministries without proper accounting.

And earlier this week, it emerged that the Pentagon's auditing agency found that Halliburton, the Houston oil services giant formerly run by Vice President Dick Cheney, overcharged by more than $108 million on a contract....
Quote:
http://www.msnbc.msn.com/id/7306162/site/newsweek/
Follow the Money
Watchdogs are warning that corruption in Iraq is out of control. But will the United States join efforts to clamp down on it?
April 4 issue [2005]

.......The administration's reluctance to prosecute has turned the Iraq occupation into a "free-fraud zone," says former CPA senior adviser Franklin Willis. After the fall of Baghdad, there was no Iraqi law because Saddam Hussein's regime was dead. But if no U.S. law applied either, then everything was permissible, says Willis. The former CPA official compares Iraq to the "Wild West," saying he delivered one $2 million payment to Custer Battles in bricks of cash. ("We called Mike Battles in and said, 'Bring a bag'," Willis told Congress in February.) Willis and other critics worry that with just $4.1 billion of the $18.7 billion spent so far, the U.S. legal stance will open the door to much more fraud in the future. "If urgent steps are not taken, Iraq ... will become the biggest corruption scandal in history," warned the anti-corruption group Transparency International in a recent report. Grassley adds that if the government decides the False Claims Act doesn't apply to Iraq, "any recovery for fraud, waste and abuse of taxpayer dollars ... would be prohibited."....
Quote:
http://seattletimes.nwsource.com/htm...ontract09.html
Saturday, October 09, 2004, 12:00 a.m. Pacific
Contractor accused of fraud in Iraq

By T. Christian Miller
Los Angeles Times

WASHINGTON — One of the U.S. security companies operating in Iraq has been suspended from doing business with the U.S. government after being accused of overbilling millions of dollars through a series of sham companies.

Security company Custer Battles sent fake bills to the U.S.-financed Coalition Provisional Authority, which ran Iraq under American occupation, according to a U.S. Air Force memo obtained by the Los Angeles Times.

The company, which provided security at the Baghdad airport, is also the target of a suit unsealed yesterday accusing it of systematically bilking U.S. taxpayers and threatening a worker and his 14-year-old son at gunpoint.

The Air Force suspension is believed to be one of the first leveled by the federal government against a company for problems with its operations in Iraq, contracting experts said.

The company is also under investigation by the FBI and the Pentagon Inspector General's Defense Criminal Investigative Services, the memo said. It could not be immediately determined yesterday whether those investigations were ongoing.

Richard Sauber, a lawyer representing Custer Battles, denied the charges. He blamed a competitor and a disgruntled former employer for making false accusations.

The company's founders are Scott Custer, a former Army Ranger and defense consultant, and former CIA officer Michael Battles, who ran for Congress in Rhode Island in 2002 and was defeated in the Republican primary. The Federal Election Commission fined Battles for misrepresenting campaign contributions.

<b>Battles is a Fox News Channel commentator.</b>

"We believe that the allegations are baseless," Sauber said. "We have every expectation that we can demonstrate they are meritless."

Several other former Republican officials have come under investigation in connection with other Iraq contracts. The Pentagon's inspector general has asked the FBI to look into a deputy undersecretary of defense in connection with a police radio contract. A former top Republican official in the Transportation Department was investigated in connection with an airport contract, U.S. officials have said.

Custer Battles was a newly formed company with no experience in the security industry when it landed one of the first contracts issued in Iraq in the spring of 2003 to secure the airport. The no-bid contract was worth $16 million when it was awarded in the chaos after the fall of Saddam Hussein.

Using Nepalese Ghurkas hired from abroad to fill out its limited staff, the company quickly expanded its presence, winning a contract in August 2003 to supply logistical support for a massive currency exchange in which Iraqis turned in their old dinars for new currency.

That contract committed the Coalition Provisional Authority to paying for all the company's costs for setting up centers where the exchanges would take place, plus a 25 percent markup for overhead and profit, according to the Air Force memo. Custer Battles then created a series of "sham companies" registered in foreign countries, the memo said. The companies were then used to create false invoices making it appear they were leasing trucks and other equipment back to Custer Battles. The scheme had the effect of inflating the 25 percent markup allowed under the contract, the memo said.

<b>In October, company representatives accidentally left a spreadsheet in a meeting that was later discovered by CPA employees. The spreadsheet showed that the currency-exchange operation had cost the company $3,738,592, but the CPA was billed $9,801,550, a markup of 162 percent.
</b>
In another case, a Custer Battles employee wrote a report that a $2.7 million invoice was based on "forged leases, inflated invoices and duplication," the Air Force memo said. In yet another case cited by the memo, Custer Battles billed $157,000 to build a helicopter pad that cost the company $95,000.

The suspension means that no government agency can issue further contracts to Custer Battles. However, the company can still continue to work on its existing contracts. The company recently ceased operations at the airport after deciding not to bid on a new security contract.

In the lawsuit, known as a false-claims action, former employee William Baldwin and a Custer Battles subcontractor named Robert Isakson repeated some of the accusations found in the Air Force memo. The false-claims action allows citizens to sue contractors on behalf of the federal government to seek damages for fraud.

The lawsuit says Custer Battles billed the CPA for work that was never done, employees who were never hired and equipment that never arrived. It says Custer Battles took at least one and as many as eight forklifts from Iraqi Airways at the airport, covered their former markings and billed the CPA for leasing them at thousands of dollars per month.

The suit said that after Isakson complained about Custer Battles practices, he was held at gunpoint by company employees along with his 14-year-old son. The employees then kicked Isakson and his son off the airport base.

Alan Grayman, a lawyer for the two whistle-blowers, said Justice Department officials told him that because the CPA was an international organization, the government could not join in the suit.

Justice Department spokesman Mark Corallo said the department does not comment on why it declines to join such suits.

When the government joins such suits, the whistle-blowers win or settle about 95 percent of the time, but only 25 percent of the time when the government passes. Whistle-blowers are entitled to a percentage of the money recovered or paid in fines.
Quote:
http://209.85.165.104/search?q=cache...s&ct=clnk&cd=5
M E M O R A N D U M
To:
Reporters and Editors
Re:
False Claims Act case in Iraq
Da:
Thursday, March 9, 2006
A juryhas foundcontractor CusterBattlesand itsowners, Scott Custer and MichaelBattles,
liable for fraud in the first Iraq contracting case under the False Claims Act. The jury found that all
of the U.S. funds spent under thecontract were fraudulentlybilled. In addition, the juryfound more
than 30 separate fraudulent acts, each one of which is subject to an $11,000 penalty. The jury also
awarded Pete Baldwin $230,000 for being demoted and constructively discharged. The total
settlement in this case is in excess of $10 million. This is the first Iraq contract caselitigated using
the False Claims Act and sets a precedent for other cases involving contractors operating in Iraq.
Sen. Chuck Grassley, chairman of the Senate Committee on Finance, is an ardent supporter
of the False Claims Act. He was author of the 1986 amendments to the False Claims Act that
substantially increased the ability of private citizens to seek recoveries on behalf of the federal
governmentfor fraud, waste, or abuse. Each Congress, Grassleyintroduces legislation requiring the
Justice Department to disclose why it did not intervene in a False Claims Act case. Grassley sent
a letter to Attorney General Gonzales regarding the Iraq case in February 2005, the text of which
follows here. Grassley issued the following comment on the verdict:
“Today’s verdict is yet another win for the American taxpayer brought to us by the False
ClaimsAct, and sadly, anotherreminder that fraud knowsno bounds.The jurors in thiscase listened
to the arguments and sent back a strong statement of intolerance for fraud, waste, and abuse of
taxpayer dollars. I remain concerned as to why the Justice Department chose not to join this case,
and if the legislation I’ve introduced is taken up and passed, we’d have some insight into why the
Justice Department decided not to intervene. War profiteering is what led President Lincoln to
supportthe original FalseClaims Act. With this verdict, Lincoln’s vision remainsas useful as ever.”
February 17, 2005
The Honorable Alberto Gonzales
Attorney General
United States Department of Justice
950 Pennsylvania Avenue, N.W.
Washington, DC 20535
Quote:
http://www.boston.com/news/nation/ar...ews+%2F+Nation

$10M verdict overturned in fraud case

By Matthew Barakat, Associated Press Writer | August 18, 2006

ALEXANDRIA, Va. --A federal judge has overturned on a technicality a $10 million jury verdict against a military contractor accused of defrauding the U.S. government in the first months of the Iraq war.

The award, levied in March against Fairfax-based Custer Battles LLC, had been the first civil fraud verdict arising from the Iraq war.

A former Custer Battles employee had sued under a whistle-blower statute, alleging that the company used shell companies and false invoices to vastly overstate its expenses on a $3 million contract to assist in establishing a currency to replace the Iraqi dinar used during Saddam Hussein's regime.

The verdict reached $10 million because the law calls for triple damages, plus penalties, fines and legal costs.

<b>But U.S. District Judge T.S. Ellis III, in a ruling made public Friday, ruled that Custer Battles' accusers failed to prove that the U.S. government was ever defrauded. Any fraud that occurred was perpetrated instead against the Coalition Provisional Authority, formed to run Iraq until a government was established.

<h3>Ellis ruled that the trial evidence failed to show that the U.S. government was the victim, even though U.S. taxpayers ultimately footed the bill.</h3>

Alan Grayson, lawyer for whistle-blowers Robert Isakson and William Baldwin, said he would appeal. He faulted the Bush administration for creating the CPA in a manner that essentially allowed it to act as a money launderer for unscrupulous military contractors.

"The Bush administration incompetently created this Frankenstein monster called Coalition Provisional Authority. They did it without thinking about it. They blundered into it," Grayson said.

In pretrial motions, Custer Battles' lawyers had advanced a similar argument about CPA's status. Ellis allowed the trial to go forward and said a case could be made to show that defrauding the CPA was tantamount to defrauding the United States.</b>

Ellis had prodded the Justice Department to weigh in on the CPA's status. Government lawyers argued that the CPA should be considered a U.S. entity, but only for the purpose of the whistle-blower law.

The judge said in his ruling that the plaintiffs failed to establish the CPA as a U.S. entity during the three-week trial this year.

Custer Battles' attorneys portrayed Ellis' ruling as a broad vindication of their clients' actions.

"The fact of the matter is that (Custer Battles founders) Scott Custer and Mike Battles did what they were contracted to do under unimaginably difficult circumstances," defense lawyer Robert Rhoad said in a statement.

Ellis left intact the jury's $165,000 wrongful termination verdict in favor of Baldwin, one of the whistle-blowers.

A lawsuit involving an even larger Custer Battles contract to provide security at the Baghdad airport has not yet gone to trial. That lawsuit will face similar obstacles, Grayson said.
The ruling above indicates that the CPA was nothing more than a money launderer that had the effect of dispersing US taxpayer funds to private parties that would be immune for claims of fraud brought later by those representing the interests of US taxpayers. Wouldn't those who created the CPA and appointed it's management, be candidates for impeachment, as conspirators in a scheme to defraud US taxpayers??

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Old 01-08-2007, 02:08 PM   #21 (permalink)
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Quote:
Originally Posted by ratbastid
I know that everyone who disagrees with you eventually turns into a big blur, but I was actually not the person who said that. Of the things Haliburton has been accused of doing, that's the one I can sort of see their side of. It's not like a big red coke truck can run between the Baghdad airport and the Green Zone. So let's not put words in my mouth, hm?
O.k.

But if you see that point, why not apply the same logic to all other costs of doing business in a war zone?


Quote:
I don't understand that last sentence. Nonetheless:
Haliburton is willing to take the risks. Why shouldn't they reap the reward? They invested in training and having the means to do business in a war zone. Not many companies can say that. An option the government has is not to out source. Haliburton was willing and able, and I am sure they negotiated in good faith. On the other hand a cost plus contract with no oversite??? Then one of the people responsible for oversite says profiteering is a problem. The congressman who made the statement in the OP in my mind is saying, I wasn't doing my job yesterday, but I am going to do my job tomorrow. i don't buy that kind of B.S.


Quote:
We did. They were called Midterm Elections. Much of the anti-Republican (really anti-Incumbent) backlash was from America being sick and tired of lobbyists running the government. That's really all that's happening here.
I am betting nothing happens. I am sure they will have hearings, and make speeches, etc., but at the end of the day - no change. One, this issue is just empty rhetoric. Perhaps some poor administrative scape-goat will suffer, but I am betting that won't even happen.


Quote:
Scoffing doesn't constitute evidence or argumentation.
If I misread what you wrote, I apologize. It seemed like you stated that Haliburton was controlling the Bush administration and congress.

Quote:
Can you deny that the company that has most been accused of war profiteering has a former CEO in the White House?
Not only that, I bet the reason he got the job to begin with was because of his influence in Washington.

I believe there are people in Washington who do what they believe is best for the country. I do not think everyone is motivated by money. Even if you disagree with Bush, I think he believes what he is doing is best for the country.

Quote:
Can you honestly say that the money they've pumped into congresspeople's re-election campaigns has been because they're friendly and helpful?
They use money to influence. Somtimes it works. I have used money to influence (also letters, signs, petitions, boycots, etc). If you are not in the game, shame on you. I actively promote my agenda, I expect others to do the same. When they do, I don't pretend their efforts are wrong but mine are o.k.

Quote:
Haliburton has been given massive and overloaded no-bid contracts on the whole war-rebuild effort. Is that because there's no competition? Or is it because they're the most favored firm of their type? And if it's because they're the most favored... why do you think that might be?
Comfort level. In high pressure situations, I go with what I know works. Pressure situations are not the time to experiment. I beleive that played a role in Haliburton getting the contracts.
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Old 01-08-2007, 02:48 PM   #22 (permalink)
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Quote:
Originally Posted by aceventura3
But if you see that point, why not apply the same logic to all other costs of doing business in a war zone?
It's a matter of scale. $45 coke is only, what, five times the price you'd see in Ohio? That actually seems pretty cheap to me, considering some contractor put his life at risk to make sure that fizzy sugar water got to our boys in uniform. Whereas the stories I've heard of rampant waste, high-priced incompetence, and vast overcharging--just read some of the posts in this thread!--aren't anything LIKE that. Completely different behavior.


Quote:
Originally Posted by aceventura3
Haliburton was willing and able, and I am sure they negotiated in good faith.
You're sure? What makes you so sure? I'm not at all sure of that, and your evidence-free certainty doesn't sway me. According to the polls I've seen, most Americans are distinctly unsure of that.

It's called a "No-Bid" contract. There's no bidding, and there's no negotiation, good faith or otherwise. The contractor names a price, and the government buys.

Quote:
Originally Posted by aceventura3
On the other hand a cost plus contract with no oversite??? Then one of the people responsible for oversite says profiteering is a problem. The congressman who made the statement in the OP in my mind is saying, I wasn't doing my job yesterday, but I am going to do my job tomorrow. i don't buy that kind of B.S.
You might go back and actually READ the OP. Senator Leahy has been trying to pass this sort of legislation for years, and it keeps getting shot down by the White House and the Republican majority (many of them major Haliburton payees, I might note). You're blaming the wrong folks here. When it comes to war profiteering controls, Leahy is one of the good guys. You might ask exactly why Bush and the Republican Congressional leadership would want to squash an anti-profiteering provision. Doesn't it seem like a patently obvious thing to make a law about? What would possess them to kill it? Hm! Think about that!

Actually, as I type that, I wonder if that's true in the world-as-you-see-it. Do you think that the behavior we think of as 'war profiteering' is just fair game in a tough business? The invisible hand at its most stark, perhaps? Is this just Capitalism in its ultimate expression?

Quote:
Originally Posted by aceventura3
If I misread what you wrote, I apologize. It seemed like you stated that Haliburton was controlling the Bush administration and congress.
I'm highly suspicious that they have an inappropriate level of input into at least contractor selection, if not also into policy decisions. It's not a stretch to imagine Cheney, in his prominent role planning and organizing the war, setting up his former company to thrive. It's what any good CEO would do, right?

Quote:
Originally Posted by aceventura3
Comfort level. In high pressure situations, I go with what I know works. Pressure situations are not the time to experiment. I beleive that played a role in Haliburton getting the contracts.
Uh hunh. As big a role as the hundreds of millions Haliburton spent on lobbying in the last five years? I'm sorry, but that's just naive.

(Oh, by the way, I laughed hard at your suggestion that "pressure situations are not the time to experiment". The whole damn war was an experiment. Don't try and tell me that somebody said, "You know, just in case we're NOT greeted as liberators.... Just in case this thing DOES go more than six months... Just in case the mission ISN'T accomplished, and these AREN'T the last throes of the insurgency... We'd better have a darned reliable logistics company in there to make sure things go well." )

Last edited by ratbastid; 01-08-2007 at 02:53 PM..
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Old 01-08-2007, 03:26 PM   #23 (permalink)
 
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Location: Washington DC
Quote:
I guess the question is going to boil down to - how does a business account for doing business in a war torn country?
Ace....the DCAA found highly questionable and/or undocumented charges by Halliburton on one contract alone amounting to $263 million.

Thats alot of baksheeh is any language.

Quote:
I think that will be the reason Congress won't make a big deal about this. They can't want this to see the light of day, it is a reality and will be in the future no matter who was or will be in the White House.
You are right about the DoD and the Repub Congress . They certaintly didnt make a big deal about it. The DoD reinbursed Halliburton for $253 million of the $263 million without question and the Congress refused all attempts for further investigation.

It will see the light of day.
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Old 01-08-2007, 03:57 PM   #24 (permalink)
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Location: rural Indiana
Quote:
Originally Posted by aceventura3
Many in the world hated us before the war. Some hated us so much that they declared a "holy war" on us. Our economy is doing pretty well by most measurements. The mieast has been unstable for a long long time. Do you think if we left the middle east tomorrow, everything would be o.k.? If that were all it took, lets leave, but most reasonable people know that it is much more complicated than that.
A lot more hate us now. Have you ever used a bellows on a fire? Young Bush's war has had the same effect on other country's hatrid of the USA. Thanks to this fiasco....the terrorists don't look so terrible to many. Great.....

Our economy sucks....unless of course you are quite rich....I'm sorry, you CAN'T tell me it's good, I know differently.

Once again...the mideast is WAY more unstable since little Bush has had his way. If he thought this war was in the country's best interest....he should have stopped and listened to all those who told him it wasn't. Shock and awe and US dick wagging might have been fun at first.....but now we are stuck with this unsolvable mess. It will take a least a decade to (hopefully) get back to the not so hot way it was before. At least there was hope then.....But, the neo-con rich got richer....

If we left tomorrow....it would be a start...perhaps the USA could begin to recover from the image of greedy pigs who do anything for oil that this ridiculous war has painted us with.
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Old 01-09-2007, 07:50 AM   #25 (permalink)
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Quote:
Originally Posted by dc_dux
Ace....the DCAA found highly questionable and/or undocumented charges by Halliburton on one contract alone amounting to $263 million.

Thats alot of baksheeh is any language.
I agree $263 million is a lot of money. Some say the war will cost over $1 trillion dollars an obscene amount of money to spend on anything, what portion of that is going to be audited?

Without getting into a debate about if the war is worth the cost. My question had to do with how do you do you do clean auditable gap accounting in a war torn area? It is easy for auditors in Washington sitting in air conditioned offices drinking lattes, to find discrepencies. And it is easy to make unrealistic comparisons between doing busines in normal conditions and doing business in a war zone. But if you are on the ground in a war zone needing to get the job done by a deadline and your boss says do whatever it takes what do you do? I guess you would have all your people get purchase orders, signed off by 4 superiors, get reciepts, total them at the end of the day, and mail them all to Marge the bookkeeper, take inventory daily, and mail inventory records to George the supply accounts clerk, etc, etc, etc. I would get the job done and worry about Marge and George later.

On the question of profiteering - A) If the government did not trust their vendor could do the job at a reasonable cost, don't outsource the job. B) If you use a cost plus contract, have a proceedure and means to verify the costs before making payment. C) If your vendor is incurring extraordinary costs, address the issue at the time not years later. If anything this is a government problem not a Halliburton problem.

Quote:
You are right about the DoD and the Repub Congress . They certaintly didnt make a big deal about it. The DoD reinbursed Halliburton for $253 million of the $263 million without question and the Congress refused all attempts for further investigation.

It will see the light of day.
I am looking forward to seeing how the Democrats handle this. Do you think they will look at contracts and expenditures that occured during Clinton's admin? Why or why not?

Quote:
Originally Posted by ratbastid
You might go back and actually READ the OP. Senator Leahy has been trying...
"There is no try. There is do, and not do."

Yoda
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Old 01-09-2007, 10:22 AM   #26 (permalink)
 
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Quote:
I am looking forward to seeing how the Democrats handle this. Do you think they will look at contracts and expenditures that occured during Clinton's admin? Why or why not?
Ace..if you understand the roles of a Congressional oversight committees and particularly the Govt. Operations/Reform Committees in both the House and Senate, you would understand that the oversight is appropriately focused on current and existing policies, practices, regulations, etc.
Quote:
To determine whether laws and programs addressing subjects within the Committee’s jurisdiction are being implemented and carried out in accordance with the intent of Congress and whether they should be continued, curtailed, or eliminated, the Committee must review and study on a continuing basis:

• the application, administration, execution, and effectiveness of laws and programs addressing subjects within the Committee’s jurisdiction;

• the organization and operation of federal agencies and entities having responsibilities for the administration and execution of laws and programs addressing subjects within the Committee’s jurisdiction.....

Committee jurisdiction and oversight responsibilities.
There is little to be accomplished by focusing on past wrong-doing, other than in an historical context, in which case LBJ probably represents the worst case scenenario of political cronyism and war profiteering.


Brown & Root co-founder George Brown (left) with President Lyndon B. Johnson. LBJ's ties to the Brown brothers dated back to his days as a Texas congressman.

http://www.npr.org/templates/story/s...toryId=1569483
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Old 01-09-2007, 10:45 AM   #27 (permalink)
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Quote:
Originally Posted by dc_dux
Ace..if you understand the roles of a Congressional oversight committees and particularly the Govt. Operations/Reform Committees in both the House and Senate, you would understand that the oversight is appropriately focused on current and existing policies, practices, regulations, etc.
I don't understand. If Haliburton and DOD where conspiring to defraud the federal government in 1991 - 2000 I would not consider that less important than them conspiring to defraud the federal government in 2000 - 2007.
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Old 01-09-2007, 10:50 AM   #28 (permalink)
 
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Quote:
Originally Posted by aceventura3
I don't understand. If Haliburton and DOD where conspiring to defraud the federal government in 1991 - 2000 I would not consider that less important than them conspiring to defraud the federal government in 2000 - 2007.
Yep...you clearly dont understand the role of oversight committees.
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Old 01-09-2007, 10:58 AM   #29 (permalink)
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Quote:
Originally Posted by dc_dux
Yep...you clearly dont understand the role of oversight committees.
Yet, you leave the issue on the table. Who cares if I understand. The point is - if fraud took place from the first gulf war until today, don't we care about what happend? Who should investigate that? Or, are we really only concerned about making political points against the Bush administration?
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Old 01-09-2007, 11:04 AM   #30 (permalink)
 
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Quote:
Originally Posted by aceventura3
Yet, you leave the issue on the table. Who cares if I understand. The point is - if fraud took place from the first gulf war until today, don't we care about what happend? Who should investigate that? Or, are we really only concerned about making political points against the Bush administration?
If fraud took place in the 90s, the Dept of Justice should investigate.

The primary role of oversight committees is to determine if regulations/administrative policies/practices & procedures, etc. are being implemented and administered by the Executive Branch as intended by Congress (as in NOW...REAL TIME, not in the past). As I said, focusing on the past can provide an historical perspective, but is not the primary purpose of oversight.
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Old 01-09-2007, 12:47 PM   #31 (permalink)
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To bad that Congress gave the Pres the infamous "blank check".

Quote:
SEC. 3. AUTHORIZATION FOR USE OF UNITED STATES ARMED FORCES.

(a) AUTHORIZATION. The President is authorized to use the Armed Forces of the United States as he determines to be necessary and appropriate in order to

(1) defend the national security of the United States against the continuing threat posed by Iraq; and

(2) enforce all relevant United Nations Security Council Resolutions regarding Iraq.
http://www.whitehouse.gov/news/relea...0021002-2.html

To bad congress authorized the money spent in Iraq by the DOD.

To bad almost every Democrat in Congress voted in favor of the above without questions.

To bad Democratic leadership is not interested in referring possible fraud as they would define it to the Dept. of Justice.

To bad that this is simply political grand standing, isn't it?
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Old 01-09-2007, 03:19 PM   #32 (permalink)
 
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With all those TOO BADS....it's GOOD ENOUGH for me that we now have a Congress (including many Repubs) finallly willing to step up and hopefully meet its oversight responsibilites and ask the tough questions of the President, the Secy of Defense, the Secy of State and all their loyal minions as they propose to move ahead with "stay the course" phase 3 (or is it 4, 5...)

It it TOO BAD that so many lives were needlessly and recklessly sacrificed before Congress may actually put American lives over political expediency. History will note the shameful abrigation of responsiblities by both parties and the institute of Congress as a whole for the last six years.

Oh..and nice ducking and weaving on the issue of Congressional oversight...which the Dems, for all their failures when they were in the minority, could not do without subpoena power.
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