Afghanistan President Hamid Karzai recently issued a controversial edict aimed at removing all private security contractors from Afghanistan this autumn. Given the mounting evidence of corruption and wrongdoing by US contractors attached to the US Agency for International Development (USAID), the government's main distributor of development contracts, Karzai for once did the right thing. In fact, he should broaden his edict and remove all development contractors from his country.
Development contracting is government-sponsored stabilisation and reconstruction efforts outsourced to private contractors.
But from dilapidated schools and unfurnished buildings to billions of dollars charged for projects abandoned before completion, the massive fraud and waste endemic to development contracting in Afghanistan does more than leave American taxpayers ripped off and battered Afghans disappointed. It undermines the efforts of those trying to make a difference: privately-funded humanitarian nongovernmental organisations (NGOs).
Federal prosecutors are investigating US-funded development contractor Louis Berger Group over claims that it submitted inflated invoices to USAID. With the group now managing more than $1.4 billion (Dh5.1 billion) worth of USAID-funded contracts in Afghanistan, the potential for malfeasance is vast.
Criminal and civil investigations into Louis Berger Group follow an expose in The Christian Science Monitor about a failed $60 million USAID-funded project with Padco, another development contractor, to provide electricity capacity in Afghanistan.
One Afghan engineer familiar with the project summarised, "Fifty per cent they didn't do. They just dug this … and left". The electricity chief for Badakhshan province was just as upset: "Now the people are hating American companies like Padco because many times they brought millions of dollars, but didn't do anything."
Scam artists
Contracting problems go beyond inflating costs or leaving projects unfinished. Christopher Shays, a former Republican congressman from Connecticut who is co-chair of the Commission on Wartime Contracting, said his team is looking into cases of contractors, or what he called "outright scam artists", charging foreign labourers to fly them to supposed jobs in the Gulf.
But instead, contractors dump labourers on air bases in Afghanistan with no job, no identification, and no way home. "The bigger problem," said one official quoted in the Washington Examiner, "is that we don't know who they are but they are inside our installations ... This presents a security risk".
Another troubling practice is contractor staff serving short tours, many rarely lasting more than a year. With subsequent staff rotations having little to no overlap, this inevitably results in the loss of lessons learned, know-how, and counterpart rapport.
The deeper causal explanation for development-contracting problems is a term known as "monopsony". Unlike a monopoly, in which one seller dominates the market, a monopsony occurs when a single buyer — in this case, the US government — faces numerous sellers.
Thus, the single buyer should have the ability to dictate terms and drive down prices. But because the US government has surrendered its oversight responsibility, this perverted market structure has resulted in a bonanza for US-government backed contractors.
Economic development is one part social science, one part social anthropology. It thus involves working with — not around — native people. Failing to foster relationships is America's biggest shortcoming in Afghanistan.
Broken promises, unfinished work, and a reluctance to learn local customs demonstrate not only apparent lack of interest in the aims we espouse, but also seeming disdain for the people of Afghanistan.
Certainly, Afghans still face an uphill battle in securing their own safety and stability, and rooting out corruption. But it is clear that US-government contractors are mired in mismanagement and failure, perpetuating dependence at best.
It is time for Karzai to end this suffering by drawing another line in the sand and mandate that all US-government development contractors be removed from Afghanistan as soon as reasonably possible.
Josef Storm is a former development contractor, serving in Afghanistan and Sudan. Malou Innocent is a foreign policy analyst at the Cato Institute.
