House Panel Criticizes Shipments of Cash to Iraq

Three key figures in Iraq's reconstruction — Paul Bremer, Stuart Bowen, and Tim Carney — are testifying before the House Oversight and Government Reform Committee.

The hearing follows a damning audit by Bowen, the Special Inspector General for Iraq Reconstruction, who says that tens of millions of dollars have been squandered.

In the meantime, President Bush is pushing Congress to approve an additional $1.2 billion for reconstruction aid.

At a hearing of the House Oversight and Government Reform Committee, the panel's Democratic chairman, Henry Waxman, took aim at the Coalition Provisional Authority, and how it handed out huge amounts of cash.

In questioning why the U.S. Federal Reserve had to ship $12 billion dollars — tons and tons of cash — to Baghdad between May 2003 and June 2004, Waxman (D-CA) asked, "Who in their right mind would send 363 tons of cash into a war zone?"

Ambassador L. Paul Bremer, the American who was in charge of Iraq at the time, said the money was not U.S. tax dollars but Iraqi money from the United Nations' oil-for-food program. Bremer said that he needed to kick-start the economy and Iraqi ministries needed to pay salaries and pensions. The United States didn't have time to impose financial controls, he said.

Bremer left Baghdad two and a half years ago. Many have since criticized him for policies that exacerbated sectarian tensions. Bremer has acknowledged mistakes even as he tried to deflect the criticism that he shouldn't have disbanded the Iraqi army or fired so many Baath Party members.

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