Government Accountability Office investigations of the Department of Defense
Encyclopedia
Government Accountability Office investigations of the Department of Defense are typically audit
s in which the Government Accountability Office
(GAO), the United States Congress
’ investigative arm, studies how the Department of Defense
spends taxpayer dollars. Since the GAO is accountable only to the legislative branch, it is in a unique position to investigate the military; no other agency can audit Federal departments with the same degree of independence from the President. However, the GAO is still subject to influence from powerful members of Congress.
Two examples of major GAO investigations in the 2000s were the audits of Operation Iraqi Freedom
and Defense Department airline reimbursements.
soldiers from six Special Forces
units had at least one pay problem associated with their mobilization. The report found, "DOD’s inability to provide timely and accurate payments to these soldiers, many of whom risked their lives in recent Iraq
or Afghanistan
missions, distracted them from their missions, imposed financial hardships on the soldiers and their families and has had a negative impact on retention"http://www.computerworld.com/managementtopics/management/itspending/story/0,10801,94392p2,00.html.
The investigation also uncovered questionable procurement
arrangements with Halliburton
. According to a United Press International
article published in The Washington Times
, the Kuwait
i-owned Timimmi Company had been serving hot meals to troops stationed in Iraq for $3 a meal. The contract was later reassigned to Halliburton, which raised the price to $5 a meal, subcontracted the meal services back out to Timimmi, and kept the 40% difference. GAO Analyst
Neil Curtain exposed the problem in a Congressional hearing, noting, "Certainly that’s unfair to the taxpayer"http://washingtontimes.com/upi-breaking/20040615-082100-3407r.htm.
As the investigation into Iraqi Freedom progressed, it began turning up worse and worse procurement problems. GAO auditors caught the Department selling new chemical and biological protective garments on the Internet for $3 each. At the same time, the Pentagon
was buying identical garments elsewhere for more than $200 apiece. Other accounting snafus resulted in the Army
losing track of 56 airplane
s, 32 tank
s, and 36 Javelin
missile command launch-unitshttp://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/05/18/MN251738.DTL.
The GAO found that the waste encountered in Iraq is symptomatic of a wider inventory-control problem. More than 200 inventory-control systems at the Defense Department still are not integrated. The GAO notes, "Poor communication between services within the Department of Defense and improper accounting results in the disposal of needed spare parts and the purchase of duplicative parts worth millions of dollars"http://www.house.gov/defazio/102699DERelease.htm.
notes that the Defense Department spent an estimated $100 million for airline tickets that were not used over six years and failed to seek refunds even though the tickets were reimbursable. The Department also reimbursed employees for airline tickets that had been purchased by the Department. To demonstrate how easy it was to have the Pentagon pay for airline travel, the investigators posed as Defense employees, had the department generate a ticket and showed up at the ticket counter to pick up a boarding passhttp://www.usatoday.com/travel/news/2004-06-09-pentagon-flights_x.htm.
The GAO also uncovered several incidences of airline-related fraud. One DOD traveler used a Department account number to pay for more than 70 airline tickets totaling more than $60,000. He then sold them at a discount to coworkers and family members for personal travel. Another employee admitted to "accidentally" claiming reimbursement for $10,000 worth of airline tickets that had been paid for by the Department.
[ GAO Comptroller General
] David Walker
are rightly critical of it"http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2003/05/18/MN251738.DTL.
These audits appear to have been more effective at prompting reform than the Defense Department’s own initiatives. In 1989, the Department began attempting to unify more than 2,000 overlapping systems used for billing, inventory, and personnel. But after spending $20 billion, the initiative was abandoned. Gregory Kutz, director of GAO’s financial management division, noted the Pentagon’s weak fiscal control over its subsidiaries – the Army, Navy
, Air Force
, and Marines
– saying, "The Pentagon’s inability to even complete an audit shows just how far they have to go"http://nuclearfree.lynx.co.nz/trillionbuck.htm.
Richard Cheney refused to disclose which individuals and groups met with the Task Force, prompting Walker to sue for the information in Federal court. In December 2002, the court ruled for Cheney.
Congressional pressure persuaded Walker to abandon appeals. Having vowed to "go to the mat," he originally planned to pursue the case further. But according to OMBWatch, "Sen. Ted Stevens
(R-AK), chairman of the Appropriations Committee, met with GAO Comptroller General David Walker earlier in the year, and sources have reported that sharp cuts in the GAO $440 million budget were threatened if the lawsuit was pursued further"http://www.ombwatch.org/article/articleview/1360/1/108/.
The GAO was designed to be independent, and Walker cites several factors insulating his agency from political pressure. In a Roll Call op-ed, he remarks, "To begin with, our location in the legislative branch gives us some distance from the executive branches we audit and oversee. Moreover, the head of GAO serves a 15-year term, which gives the agency a continuity of leadership that is rare in the federal government. . . . GAO’s independence is further safeguarded by the fact that its workforce consists of career civil servants hired on the basis of their knowledge, skill, and ability"http://www.gao.gov/about/rollcall07192004.pdf.
However, the GAO, like all federal agencies, is subject to Congress’ budgetary power. According to The Hill, "Walker did say . . . that several lawmakers have threatened in the past year to cut agency funding if it persisted with the controversial lawsuit. He also said the budget threat was among a number of factors that tipped his Feb. 7 decision to halt litigation"http://www.hillnews.com/news/021903/cheney.aspx.
It is difficult to tell whether curtailed GAO independence will threaten Defense Department reform. Some aspects of Defense Department accounting have resisted reform for decades. Danielle Brian, director of the nonprofit Project on Governmental Oversight, says, "Waste has become ingrained in the Defense budget because opposition to defense spending is portrayed as unpatriotic, and legislators are often more concerned about winning Pentagon pork
than controlling defense waste"http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/05/18/MN251738.DTL.
But even Representatives who generally support Defense spending seem to be getting fed up with the problem. Representative Thomas M. Davis
, R-Virginia, asked the Pentagon to present 11 documents relating to contracts in Iraq, among them papers that would prove whether Halliburton benefited from its association with Cheney. And Rep. John Duncan, R-Tenn., of the House Committee on Government Reform recently said, "I’ve always considered myself to be a pro-military type person, but that doesn’t mean I just want to sit back and watch the Pentagon waste billions and billions of dollars"http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/05/18/MN251738.DTL.
Supporters of the GAO investigations like to point out the disparity between the GAO budget and military expenses. The GAO’s Fiscal Year 2004 annual budget was $463.6 millionhttp://www.gao.gov/about/gglance.html. In contrast, GAO reports show that the Defense Department’s 2,200 overlapping financial systems cost $18 billion a year to operatehttp://nuclearfree.lynx.co.nz/trillionbuck.htm.
Audit
The general definition of an audit is an evaluation of a person, organization, system, process, enterprise, project or product. The term most commonly refers to audits in accounting, but similar concepts also exist in project management, quality management, and energy conservation.- Accounting...
s in which the Government Accountability Office
Government Accountability Office
The Government Accountability Office is the audit, evaluation, and investigative arm of the United States Congress. It is located in the legislative branch of the United States government.-History:...
(GAO), the United States Congress
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....
’ investigative arm, studies how the Department of Defense
United States Department of Defense
The United States Department of Defense is the U.S...
spends taxpayer dollars. Since the GAO is accountable only to the legislative branch, it is in a unique position to investigate the military; no other agency can audit Federal departments with the same degree of independence from the President. However, the GAO is still subject to influence from powerful members of Congress.
Two examples of major GAO investigations in the 2000s were the audits of Operation Iraqi Freedom
2003 invasion of Iraq
The 2003 invasion of Iraq , was the start of the conflict known as the Iraq War, or Operation Iraqi Freedom, in which a combined force of troops from the United States, the United Kingdom, Australia and Poland invaded Iraq and toppled the regime of Saddam Hussein in 21 days of major combat operations...
and Defense Department airline reimbursements.
Operation Iraqi Freedom
GAO investigations into Operation Iraqi Freedom revealed a number of accounting problems, ranging from the mundane to the severe. Pay irregularities were a chronic problem. According to a GAO report cited in Computerworld, 450 of the 481 Army National GuardArmy National Guard
Established under Title 10 and Title 32 of the U.S. Code, the Army National Guard is part of the National Guard and is divided up into subordinate units stationed in each of the 50 states, three territories and the District of Columbia operating under their respective governors...
soldiers from six Special Forces
Special forces
Special forces, or special operations forces are terms used to describe elite military tactical teams trained to perform high-risk dangerous missions that conventional units cannot perform...
units had at least one pay problem associated with their mobilization. The report found, "DOD’s inability to provide timely and accurate payments to these soldiers, many of whom risked their lives in recent Iraq
Iraq
Iraq ; officially the Republic of Iraq is a country in Western Asia spanning most of the northwestern end of the Zagros mountain range, the eastern part of the Syrian Desert and the northern part of the Arabian Desert....
or Afghanistan
Afghanistan
Afghanistan , officially the Islamic Republic of Afghanistan, is a landlocked country located in the centre of Asia, forming South Asia, Central Asia and the Middle East. With a population of about 29 million, it has an area of , making it the 42nd most populous and 41st largest nation in the world...
missions, distracted them from their missions, imposed financial hardships on the soldiers and their families and has had a negative impact on retention"http://www.computerworld.com/managementtopics/management/itspending/story/0,10801,94392p2,00.html.
The investigation also uncovered questionable procurement
Procurement
Procurement is the acquisition of goods or services. It is favourable that the goods/services are appropriate and that they are procured at the best possible cost to meet the needs of the purchaser in terms of quality and quantity, time, and location...
arrangements with Halliburton
Halliburton
Halliburton is the world's second largest oilfield services corporation with operations in more than 70 countries. It has hundreds of subsidiaries, affiliates, branches, brands and divisions worldwide and employs over 50,000 people....
. According to a United Press International
United Press International
United Press International is a once-major international news agency, whose newswires, photo, news film and audio services provided news material to thousands of newspapers, magazines and radio and television stations for most of the twentieth century...
article published in The Washington Times
The Washington Times
The Washington Times is a daily broadsheet newspaper published in Washington, D.C., the capital of the United States. It was founded in 1982 by Unification Church founder Sun Myung Moon, and until 2010 was owned by News World Communications, an international media conglomerate associated with the...
, the Kuwait
Kuwait
The State of Kuwait is a sovereign Arab state situated in the north-east of the Arabian Peninsula in Western Asia. It is bordered by Saudi Arabia to the south at Khafji, and Iraq to the north at Basra. It lies on the north-western shore of the Persian Gulf. The name Kuwait is derived from the...
i-owned Timimmi Company had been serving hot meals to troops stationed in Iraq for $3 a meal. The contract was later reassigned to Halliburton, which raised the price to $5 a meal, subcontracted the meal services back out to Timimmi, and kept the 40% difference. GAO Analyst
Business analyst
A Business Analyst analyzes the organization and design of businesses, government departments, and non-profit organizations; BAs also assess business models and their integration with technology.-Levels:...
Neil Curtain exposed the problem in a Congressional hearing, noting, "Certainly that’s unfair to the taxpayer"http://washingtontimes.com/upi-breaking/20040615-082100-3407r.htm.
As the investigation into Iraqi Freedom progressed, it began turning up worse and worse procurement problems. GAO auditors caught the Department selling new chemical and biological protective garments on the Internet for $3 each. At the same time, the Pentagon
The Pentagon
The Pentagon is the headquarters of the United States Department of Defense, located in Arlington County, Virginia. As a symbol of the U.S. military, "the Pentagon" is often used metonymically to refer to the Department of Defense rather than the building itself.Designed by the American architect...
was buying identical garments elsewhere for more than $200 apiece. Other accounting snafus resulted in the Army
United States Army
The United States Army is the main branch of the United States Armed Forces responsible for land-based military operations. It is the largest and oldest established branch of the U.S. military, and is one of seven U.S. uniformed services...
losing track of 56 airplane
Fixed-wing aircraft
A fixed-wing aircraft is an aircraft capable of flight using wings that generate lift due to the vehicle's forward airspeed. Fixed-wing aircraft are distinct from rotary-wing aircraft in which wings rotate about a fixed mast and ornithopters in which lift is generated by flapping wings.A powered...
s, 32 tank
Tank
A tank is a tracked, armoured fighting vehicle designed for front-line combat which combines operational mobility, tactical offensive, and defensive capabilities...
s, and 36 Javelin
FGM-148 Javelin
The FGM-148 Javelin is a United States-made man-portable third generation anti-tank missile fielded to replace the Dragon antitank missile.-Overview:Javelin is a fire-and-forget missile with lock-on before launch and automatic self-guidance...
missile command launch-unitshttp://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/05/18/MN251738.DTL.
The GAO found that the waste encountered in Iraq is symptomatic of a wider inventory-control problem. More than 200 inventory-control systems at the Defense Department still are not integrated. The GAO notes, "Poor communication between services within the Department of Defense and improper accounting results in the disposal of needed spare parts and the purchase of duplicative parts worth millions of dollars"http://www.house.gov/defazio/102699DERelease.htm.
Airline reimbursements
A more recent GAO investigation revealed $100 million in wasted airline fees. The Associated PressAssociated Press
The Associated Press is an American news agency. The AP is a cooperative owned by its contributing newspapers, radio and television stations in the United States, which both contribute stories to the AP and use material written by its staff journalists...
notes that the Defense Department spent an estimated $100 million for airline tickets that were not used over six years and failed to seek refunds even though the tickets were reimbursable. The Department also reimbursed employees for airline tickets that had been purchased by the Department. To demonstrate how easy it was to have the Pentagon pay for airline travel, the investigators posed as Defense employees, had the department generate a ticket and showed up at the ticket counter to pick up a boarding passhttp://www.usatoday.com/travel/news/2004-06-09-pentagon-flights_x.htm.
The GAO also uncovered several incidences of airline-related fraud. One DOD traveler used a Department account number to pay for more than 70 airline tickets totaling more than $60,000. He then sold them at a discount to coworkers and family members for personal travel. Another employee admitted to "accidentally" claiming reimbursement for $10,000 worth of airline tickets that had been paid for by the Department.
Defense Department responses to investigations
There is evidence that GAO investigations are encouraging the Department to reform. The Halliburton contract was re-negotiated and assigned directly to Timimmi. And Dov Zakheim, chief financial officer for the Pentagon, said, "We are overhauling our financial management system precisely because people likeComptroller General of the United States
The Comptroller General of the United States is the director of the Government Accountability Office , a legislative branch agency established by Congress in 1921 to ensure the fiscal and managerial accountability of the federal government...
David M. Walker (U.S. Comptroller General)
David M. Walker served as United States Comptroller General from 1998 to 2008, and is now the Founder and CEO of the Comeback America Initiative.- Career as Comptroller General :...
are rightly critical of it"http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2003/05/18/MN251738.DTL.
These audits appear to have been more effective at prompting reform than the Defense Department’s own initiatives. In 1989, the Department began attempting to unify more than 2,000 overlapping systems used for billing, inventory, and personnel. But after spending $20 billion, the initiative was abandoned. Gregory Kutz, director of GAO’s financial management division, noted the Pentagon’s weak fiscal control over its subsidiaries – the Army, Navy
United States Navy
The United States Navy is the naval warfare service branch of the United States Armed Forces and one of the seven uniformed services of the United States. The U.S. Navy is the largest in the world; its battle fleet tonnage is greater than that of the next 13 largest navies combined. The U.S...
, Air Force
United States Air Force
The United States Air Force is the aerial warfare service branch of the United States Armed Forces and one of the American uniformed services. Initially part of the United States Army, the USAF was formed as a separate branch of the military on September 18, 1947 under the National Security Act of...
, and Marines
United States Marine Corps
The United States Marine Corps is a branch of the United States Armed Forces responsible for providing power projection from the sea, using the mobility of the United States Navy to deliver combined-arms task forces rapidly. It is one of seven uniformed services of the United States...
– saying, "The Pentagon’s inability to even complete an audit shows just how far they have to go"http://nuclearfree.lynx.co.nz/trillionbuck.htm.
Threats to GAO independence
Scholars believe, however, that the GAO’s authority could be undermined in the wake of a landmark case, Walker vs. Cheney. This Federal lawsuit pertained to a GAO investigation into the Bush Administration’s Energy Task Force. Vice PresidentVice President of the United States
The Vice President of the United States is the holder of a public office created by the United States Constitution. The Vice President, together with the President of the United States, is indirectly elected by the people, through the Electoral College, to a four-year term...
Richard Cheney refused to disclose which individuals and groups met with the Task Force, prompting Walker to sue for the information in Federal court. In December 2002, the court ruled for Cheney.
Congressional pressure persuaded Walker to abandon appeals. Having vowed to "go to the mat," he originally planned to pursue the case further. But according to OMBWatch, "Sen. Ted Stevens
Ted Stevens
Theodore Fulton "Ted" Stevens, Sr. was a United States Senator from Alaska, serving from December 24, 1968, until January 3, 2009, and thus the longest-serving Republican senator in history...
(R-AK), chairman of the Appropriations Committee, met with GAO Comptroller General David Walker earlier in the year, and sources have reported that sharp cuts in the GAO $440 million budget were threatened if the lawsuit was pursued further"http://www.ombwatch.org/article/articleview/1360/1/108/.
The GAO was designed to be independent, and Walker cites several factors insulating his agency from political pressure. In a Roll Call op-ed, he remarks, "To begin with, our location in the legislative branch gives us some distance from the executive branches we audit and oversee. Moreover, the head of GAO serves a 15-year term, which gives the agency a continuity of leadership that is rare in the federal government. . . . GAO’s independence is further safeguarded by the fact that its workforce consists of career civil servants hired on the basis of their knowledge, skill, and ability"http://www.gao.gov/about/rollcall07192004.pdf.
However, the GAO, like all federal agencies, is subject to Congress’ budgetary power. According to The Hill, "Walker did say . . . that several lawmakers have threatened in the past year to cut agency funding if it persisted with the controversial lawsuit. He also said the budget threat was among a number of factors that tipped his Feb. 7 decision to halt litigation"http://www.hillnews.com/news/021903/cheney.aspx.
It is difficult to tell whether curtailed GAO independence will threaten Defense Department reform. Some aspects of Defense Department accounting have resisted reform for decades. Danielle Brian, director of the nonprofit Project on Governmental Oversight, says, "Waste has become ingrained in the Defense budget because opposition to defense spending is portrayed as unpatriotic, and legislators are often more concerned about winning Pentagon pork
Pork barrel
Pork barrel is a derogatory term referring to appropriation of government spending for localized projects secured solely or primarily to bring money to a representative's district...
than controlling defense waste"http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/05/18/MN251738.DTL.
But even Representatives who generally support Defense spending seem to be getting fed up with the problem. Representative Thomas M. Davis
Thomas M. Davis
Thomas Milburn "Tom" Davis III was a Republican member of the United States House of Representatives, representing Virginia's 11th congressional district in Northern Virginia. Davis was considering a run for the U.S. Senate seat being vacated by five-term incumbent and fellow Republican John...
, R-Virginia, asked the Pentagon to present 11 documents relating to contracts in Iraq, among them papers that would prove whether Halliburton benefited from its association with Cheney. And Rep. John Duncan, R-Tenn., of the House Committee on Government Reform recently said, "I’ve always considered myself to be a pro-military type person, but that doesn’t mean I just want to sit back and watch the Pentagon waste billions and billions of dollars"http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/05/18/MN251738.DTL.
Supporters of the GAO investigations like to point out the disparity between the GAO budget and military expenses. The GAO’s Fiscal Year 2004 annual budget was $463.6 millionhttp://www.gao.gov/about/gglance.html. In contrast, GAO reports show that the Defense Department’s 2,200 overlapping financial systems cost $18 billion a year to operatehttp://nuclearfree.lynx.co.nz/trillionbuck.htm.