MyGovCost News & Blog

The Curse of Corporate Welfare

Thursday August 17th, 2017   •   Posted by Craig Eyermann at 6:38am PDT   •  

18954735 - businessman asking for bailout When it comes to the amount of money that’s wasted by governments, it’s hard to beat corporate welfare for both its size and its endurance.

All too often, once a company is gifted with taxpayer money to “stimulate the economy” or to “stabilize the market” or to “keep jobs here”, it opens the door to a continuing stream of subsidy payments or outright bailouts that once turned on, take on a life all their own, where the companies benefiting from the largess of politicians become completely addicted to the point where they cannot survive without them.

Worse, the politicians in charge of providing the welfare don’t seem to be either able or willing to truly stop it.

There’s a great example of the unintended consequences of corporate codependency on government welfare in New York, where Tim Knauss of the Syracuse Post Standard reports on the continuing gifts of public tax dollars to private corporations years after their funding spigot was supposedly turned off.

New York state shut down its out-of-control Empire Zone business incentive program in 2010 after providing millions of dollars to companies that state officials never intended to help.

Unfortunately for state taxpayers, the costs continue to pile up. Businesses that got in before the door shut can earn lucrative tax credits for up to 14 years.

The ultimate cost is likely to be at least $3 billion – with a B.

It could go even higher. Businesses are holding more than $1.5 billion in unused credits they hope to use someday to offset their taxes. That could push the final cost over $4 billion.

A lot of that money went to businesses that had already been operating for decades, added few if any new jobs, and were never at risk of leaving for North Carolina.

Knauss provides examples of the kinds of companies that cashed in on the New York state government’s willingness to give away tax dollars without any real consideration. Starting with the owner of two antiquated power plants.

The owner of two Korean War-era power plants near Buffalo received more than $190 million in Empire Zone tax credits between 2003 and 2015. During part of that period, the state was suing the Huntley and Dunkirk generating stations over their heavy pollution.

After 13 years of subsidies, both Huntley and Dunkirk closed, eliminating 136 jobs.

Another way to think of that money is that the utility owner was paid $107,466 per job “saved” per year to keep polluting the environment, which the state is also paying to clean up. Here’s another example of wasted stimulus spending for a different kind of utility company.

A company that owns 71 hydroelectric plants acquired from Upstate utility company Niagara Mohawk Power Corp. estimated a combined Empire Zone take of roughly $142 million. Most of the hydros were built at least 60 years ago. Some were built 100 years ago by predecessors of Niagara Mohawk.

Empire Zone credits were so lucrative that the hydro company paid $1 million a year to the town and village of Potsdam in return for drawing their Empire Zone to include nearby dams.

What kind of return on investment do you suppose the corporate owner of the hydroelectric plants got by “investing” $1 million of their money in the local politicians of an nearby town and village to incent them to redraw the map to their benefit? It was probably quite a bit higher than what the return would have been if they had invested in upgrading the company’s well-aged infrastructure!

Knauss concludes his reporting on the waste generated by New York’s Empire Zones by quoting Howard Zemsky, who is currently the state’s economic development commissioner.

“I’ve never done a study on Empire Zones,” Zemsky said. “(But) I would say the empirical evidence on the Upstate economy over many decades suggests that what we were doing, we should not be doing. This doesn’t really require a whole lot more analysis, in my opinion, than that.”

Although New York’s Empire Zone economic development program was terminated seven years ago, they tax credits they left behind don’t have an expiration date. The corporations that collected them can still cash in an additional $1.5 billion over as long a time as they might choose. It’s a gift from state politicians to their cronies in the corporate world that just keeps giving.

Transit Boss Bonanza Stresses Taxpayers

Monday August 14th, 2017   •   Posted by K. Lloyd Billingsley at 1:59pm PDT   •  

In California’s capital of Sacramento, rapid transit has been in terrible shape, but not for lack of spending on management. As we noted, after hiring Mike Wiley as manager, the RT district plunged into financial distress, tapping reserve accounts to balance its budget and raising fares 10 percent. Though a major bust as transit boss, Wiley was eligible for a pension of $278,000, a full $48,000 more than his final salary of $230,000 and $68,000 higher than the federal pension maximum of $210,000. He opted for a plan that will pay him $220,000 a year, a full $10,000 above the federal maximum. The district kept Wiley on the job as a “retired annuitant,” while hiring new boss Henry Li.

On Li’s watch, the district’s emergency account is “still anemic,” fares remain among the highest in the nation, and ridership has dropped. In two years, according to news reports, the district could face an annual shortfall of $3.6 million on debt payments. Even so, the district does not hesitate to throw money at Henry Li.

His new five-year deal boosts his pay 33 percent to a total compensation package of $379,000. Some locals told reporters the huge raise was “tone deaf,” but there’s more to it than that. The whopper package is not based on Li’s job performance but as RT board chairman and Folsom mayor Andy Morin put it, on “what other transit chiefs make.” That’s a good deal for Li, who like Mike Wiley will be eligible for a pension higher than his salary. Like other ruling-class largesse, it’s a bad deal for California’s embattled taxpayers, recently slammed with a $5.2 billion hike in gasoline taxes and vehicle fees.

The Return of the Debt Ceiling, 2017 Edition

Monday August 14th, 2017   •   Posted by Craig Eyermann at 6:26am PDT   •  

44036859 - theater stage with red curtains and spotlights. theatrical scene in the light of searchlights In what is almost an annual tradition now, the U.S. Congress will soon come up on the deadline where it must either approve a new increase in the statutory debt ceiling, the total amount of public debt outstanding that the U.S. government is officially allowed to have on its books, or risk defaulting on payments owed to the U.S. government’s creditors.

Business Insider‘s Bob Bryan outlines the worst case scenario facing the nation if the Congress fails to increase the debt limit to cover the amount of spending it has previously approved.

Congress, in the midst of a month-long August recess, faces a massive policy threat when lawmakers return to Washington next month.

By the end of September, Congress must approve legislation to raise the nation’s debt ceiling—or risk a goal economy disaster. And it already sounds like the attempts at a compromise aren’t going well....

If breached, it could lead to disastrous consequences for the federal government, the US economy, and the global financial system. If the debt ceiling is not raised, the federal government would lose the ability to pay bills it already owes in the form of US Treasury bills and could lead the US to default on some of that debt.

The possible fallout from a default, according to a study by the Treasury Department, would include a meltdown in the stock and bond markets, a downgrade of the US’s credit rating, which would increase the government’s borrowing costs, and the undermining of the full faith and credit of the country.

Currently, the Congressional Budget Office estimates that the Congress has until sometime in mid-October to act, while the U.S. Treasury Department is more conservative in estimating that the U.S. Congress must act on or before September 29, 2017.

This isn’t our first rodeo in contemplating the potential for the U.S. government to not have sufficient funds to make principal and interest payments to its creditors, where we’ve come to view much of the rhetoric coming from Capitol Hill as being a lot like the annual exercises of what we call government shutdown theater, where the positions that will soon be loudly taken by politicians on all sides of the issue are done more for publicity than for public purpose.

That wasn’t always the case. Just a few years ago, the combination of skyrocketing national debt with a peculiarly vindictive Presidential administration seeking to exploit risking the full faith and credit of the U.S. government for political advantage gave great cause for concern, but since then, things have changed.

The most noticeable change obviously is the current occupant in the White House, but much more significantly, is the demolition of the legal rationale used by the Obama administration to justify its partisan gamesmanship in playing with the national debt ceiling.

Simply stated, that rationale was that the U.S. Treasury Department could not legally prioritize payments to the U.S. government’s creditors over all its other spending. If the federal government didn’t have enough money to go around to cover all its planned spending along with all of its debt payments, the Obama administration argued that cuts in payments to all would have to be made equally across the board, thereby ensuring that a default on the nation’s debt would occur.

Since then, a number of institutions on what the U.S. Treasury Department can legally do in managing the federal government’s money and debt, with the Congressional Budget Office specifically addressing the question in its June 2017 report on the debt ceiling.

When Would the Extraordinary Measures and Cash Run OUt, and What Would Happen Then?

If the debt limit is not increased above the amount that was established on March 16, 2017, the Treasury will not be authorized to issue additional debt that increases the amount outstanding. (It will be able to issue additional debt only in the amount of maturing debt or the amounts cleared by taking extraordinary measures.) That restriction would ultimately lead to delays of payments for government programs and activities, a default on the government’s debt obligations, or both.

Writing at International Liberty, economist Dan Mitchell translates what that means.

In other words, the government can choose to pay interest on the debt and defer other bills. As I’ve repeatedly said in all my public pronouncements, a default will occur only if an administration wants it to occur.

But that’s not going to happen. Just as Obama’s various Treasury Secretaries would have “prioritized” payments to bondholders, Trump’s Treasury Secretary will do the same thing if push comes to shove.

In fact, the Obama administration actually had a secret plan to do exactly what it claimed it could not do.

Given President Trump’s business background, there’s every reason to think that his administration would prioritize principal and interest payments to U.S. government bondholders over all its other spending, despite recent statements by administration officials to the contrary. Not having the legal authority to borrow more to get the cash it needs to spread around to pay for all its spending no longer automatically means that the U.S. government must default on its debts.

But between now and such a time however, we will have a lot of highly stylized political theater in Washington D.C. to get through.

A Failure to Execute in Washington D.C.

Thursday August 10th, 2017   •   Posted by Craig Eyermann at 6:15am PDT   •  

Earlier this week, MyGovCost celebrated the termination of a wasteful spending program that would save $10 million a year.

That success however must be measured against Washington D.C.’s projected $4,100,000 million ($4.1 trillion) spending, where a $10 million reduction is not any more than the barest amount of nibbling around the edges.

Part of the problem is that when politicians get to Washington D.C. after getting elected, they prove incapable of following through on their campaign promises to rein in wasteful spending. It’s not that the idea is wrong, instead it’s a failure to execute on delivering the promise of the idea.

In the words of popular author Sue Grafton: “Ideas are easy. It’s the execution of ideas that really separates the sheep from the goats.” And we sure do have an awful lot of goats on Capitol Hill these days.

Writing at Reason, Veronique de Rugy explains what that means in 2017 after years of promises to put the U.S. government onto a fiscally sound path.

An amazing thing happened, though, when Barack Obama was elected and the Democrats regained control of Congress. Republicans suddenly remembered the horrors of federal overspending, mounting debt and the endless intrusion by the federal government into every aspect of our lives. Republicans lambasted the notion that Keynesian-style big-government spending would boost the economy. They decried Obamacare and the Democrats’ love for “socialized medicine.” They bemoaned continuous growth in federal debt and conveniently laid the problem at Obama’s feet.

Then another amazing thing happened: Donald Trump was elected, and the GOP was once again in charge. Almost immediately, Republicans began touting increased military and infrastructure spending to create jobs and spur the economy—the very Keynesian-inspired policies they attacked when advocated by Democrats. Even the small number of federal program terminations proposed by the Trump administration were too much for congressional Republicans. Nope—when it comes to the federal budget and yet another looming brush-up against the federal debt ceiling, Republicans reveal that they’re content to maintain an untenable status quo, despite all the lip service paid to the dangers of big government over the years.

It is not terribly surprising that today’s members of Congress aren’t proving capable of delivering on their major campaign promises to restrain government spending. It’s a sad thing that the best constraint that we’ve seen to achieve that result to date is a government where control of the various branches are divided between political factions. About the best news we have is that gridlock has survived, which may limit the damage.

But we still have the age old problem of what to do about all the goats.

More Costs Flowing from Government Dam Negligence

Wednesday August 9th, 2017   •   Posted by K. Lloyd Billingsley at 12:08pm PDT   •  

National Water Quality Month is turning out rather dry in California, but trouble will soon be washing up in court. Farmers and business owners have filed more than 90 claims against the state government for causing a total of $1.7 billion in losses from the spillway failure at Oroville Dam back in February. Might they have a case?

As we noted, the failure of the spillway prompted the evacuation of 200,000 people, hardly a frivolous move, because if the spillway collapsed it could have caused complete failure of the dam, built in 1968.

As it turned out, government engineers knew for decades that the dirt spillway was unreliable but failed to reinforce it with concrete. As Representative John Garamendi (D–Walnut Grove) famously put it, the dirt spillway “worked fine until it had to be used, in which case it didn’t work so well.” State water bosses also failed to add gates above the spillway, which would have allowed the reservoir to rise another ten feet. Governor Jerry Brown claimed to be unaware of these problems and proclaimed, “stuff happens and we respond.”

One of the government’s first moves was to dam up the flow of information on safety issues. The governor and state water bureaucrats blocked public access to the dam’s design specifications, federal inspection reports, technical documents, and other crucial information. Department of Water Resources officials claimed it was a security matter, lest the information “fall into the wrong hands,” terrorists, for example. In typical style, politicians and bureaucrats are simply hiding years of negligence, faulty oversight, and misguided spending.

The state will doubtless point the finger at Mother Nature, but more evidence may emerge in court that government is to blame. Any payout will heap more costs on California’s embattled taxpayers, now staring down the barrel of a $5.2 billion hike on gasoline, diesel fuel and vehicle fees.


The Death of myRA

Monday August 7th, 2017   •   Posted by Craig Eyermann at 6:22am PDT   •  

There is fantastic news coming out from Washington D.C. this week. The U.S. Treasury Department is shutting down a money-losing retirement account program that was aimed at getting low income-earning Americans to invest their retirement savings in its very low interest rate-paying U.S. Treasury bond fund for U.S. government employees (the Thrift Savings Plan G Fund).

The New York Times describes just how costly the program has been to U.S. taxpayers.

An Obama-era program that created savings accounts to help more people put away money for retirement is being shut down by the Treasury Department, which deemed the program too expensive.

The 30,000 participants in the program, known as myRA and intended for people who did not have access to workplace savings plans, were sent an email on Friday morning alerting them of the closing. Participants were informed that they could roll the money into a Roth individual retirement account, the Treasury Department said.

President Barack Obama ordered the creation of the so-called starter accounts three years ago, and they became available at the end of 2015. Since then, about 20,000 accounts have been opened, with participants contributing a total of $34 million, according to the Treasury; the median account balance was $500. An additional 10,000 accounts whose owners have not contributed to them have been opened.

Jovita Carranza, the United States treasurer, said in a statement that demand for the accounts was not high enough to justify the expense. The program has cost $70 million since 2014, according to the Treasury, and would cost $10 million a year in the future.

Longtime MyGovCost readers may be more familiar with the U.S. Treasury Department’s myRA program than its intended market, which we described as “little more than a channel for boosting the sales of long-term, low-yielding U.S. Treasuries by targeting low-income earners”, which we later pointed out the Treasury Department’s hypocrisy in putting the interests of the government to borrow money at the lowest rates possible ahead of the interests of the program’s customers to build up their retirement savings.

President Obama’s “myRA” retirement account program represents an early step in that direction, which is currently being targeted at exploiting the most financially illiterate Americans, who likely don’t appreciate that when more money floods into Treasury auctions to buy government bonds, the yield (or interest rate) that the government will pay to borrow the money falls, which in turn means a worse rate of return for them in their myRA retirement account, which in turn would make it harder to accumulate a decent amount of money to even be able to afford to retire.

That President Obama’s myRA program is a bad deal for regular Americans can be confirmed by what some of the same people backing the President’s initiative are doing to advance the financial interests of the federal government’s employees in their default investment options for their Thrift Savings Plan retirement accounts, where currently, the default option for federal employees is to invest in the exact same government bond funds as for the myRA accounts. Because federal employees want better returns and bigger retirement savings, they’re pushing for legislation to have the default investment option changed to one that has a much higher rate of return.

Americans who have money in a myRA account can have them rolled into a tax-free Roth Individual Retirement Account (Roth IRA). The press release announcing the termination of the myRA program revealed just how redundant the program was in noting that “retirement savers have options in the private sector that offer no account maintenance fees, no minimum balance, and safe investment opportunities”.

In other words, there was never a legitimate need to have the federal government get into the retirement savings business in the first place. U.S. taxpayers will save at least $10 million per year because the Treasury Department learned an important lesson.

Now, if the Treasury Department would just apply the lessons learned to the federal government’s failing student loan business, U.S. taxpayers might see savings in the billions.

The Case of the Phantom Frog

Thursday August 3rd, 2017   •   Posted by Craig Eyermann at 6:07am PDT   •  

Imagine if land that had been held in your family for decades were suddenly subject to new environmental regulations that would severely limit what you could do on that land, where you would not be able to do things like build a new house on it, cut down trees on it, or even to farm it the way your family had for generations.

As you might imagine, the value of your family’s land would plunge, because it would no longer be attractive to people who might consider buying it, because those same restrictions would apply to them.

Now imagine that those new environmental regulations were imposed by the federal government, egged on by environmental activists, that are intended to preserve the natural habitat of an endangered species of frog that had not been seen anywhere on or near your land for nearly half a century. And in a particularly cruel twist, you discover that your family’s land would not even provide a suitable habitat for the endangered species in question unless the government compelled your family to spend thousands of dollars to transform it into a suitable habitat for the endangered frog.

If that sounds like a bizarre nightmare scenario of government bureaucracy, you’re right. RealClearInvestigations James Varney describes a very peculiar case of government regulations run amuck in the name of protecting the dusky gopher frog.

The phone call came out of the blue in 2011.

A federal biologist on the other end of the line told Edward B. Poitevent II that the U.S. Fish & Wildlife Service intended to designate a large swath of Louisiana woods that had been in his family for generations a “critical habitat” for the endangered dusky gopher frog.

Poitevent was confused because the frog had been neither seen nor its croak heard on the land since the 1960s. Later he would learn that his land is not, in fact, a suitable habitat for the frog anyway.

“No matter how you slice it or dice it, it’s a taking of my land in that I can’t use it or sell it now,” said Poitevent, a New Orleans lawyer.

A half century after disappearing from the 1,500-acre parcel in Louisiana, the dusky gopher frog will likely appear this month in filings urging the U.S. Supreme Court to settle the matter after years of costly litigation.

In one sense, the case illustrates the conflicts that arise as conservationists and the government use the Endangered Species Act to protect privately held lands. But legal scholars say the absent amphibian could provide a broader test of just how far the government’s regulatory reach can extend under the Constitution.

The legal case in favor of the homeowner will come down to a court’s determination of what constitutes an “unreasonable” restriction imposed by an ambiguously-worded federal regulation, where common sense has not been allowed to enter the argument as lower level judges have found against the landowners, claiming that their legal hands were tied by a 1982 Supreme Court precedent that awarded a profound amount of legal deference to federal regulators regardless of the specific facts that apply to the case.

With that being the situation, the Case of the Phantom Frog will be an interesting one to follow as it moves through the nation’s appellate courts, particularly if it ultimately reaches the Supreme Court where it could prompt the court to overturn all or part of its previous decision that benefited the interests of federal regulators over those of regular Americans.

On a final note, this kind of environmental-activist directed policy affects far more than a family-owned farm in Louisiana. On July 31, 2017, some 1.8 million acres (2,812 square miles) of farm, ranch and timber lands in the Sierra Nevada mountain range in California had similar restrictions imposed upon them by the U.S. Fish and Wildlife Service, which were defined as “critical habitat” for three species of frogs and toads.

Would the government be so set on imposing such environmental regulations if it were required to fully compensate regular Americans for diminishing the value of their property?

Advanced Waste Studies in the UC System

Wednesday August 2nd, 2017   •   Posted by K. Lloyd Billingsley at 4:51am PDT   •  

As we noted, the University of California at Davis garnered national attention in 2011 when campus cops pepper-sprayed students peacefully demonstrating against tuition hikes. The ensuing lawsuits cost taxpayers more than $1 million, most of it going to crony consultants. No UCD administrators got fired, least of all chancellor Linda Katehi, who also came under fire for spending $407,000 in university funds to shore up her image on the internet. She also mounted a surge of nepotism, employing three family members on campus, including daughter-in-law Emily Prieto, recipient of hefty pay raises and promoted to “assistant vice chancellor.” Katehi resigned last August but UCD kept her on paid leave. Now she’s back in a big way.

In September, Katehi will return to UC Davis as a “distinguished professor” of computer and electrical engineering and “women and gender studies.” According to news reports, Katehi will be paid “at the same rate she received as campus leader.” Her nine-month contract for $318,000, when annualized, is “equivalent to the $424,000 salary she received as chancellor.” At UC Davis, an incompetent administrator and non-leader can do pretty much anything she wants and still pull down the big bucks at taxpayer expense. On the other hand, the entire UC system under Janet Napolitano, a former Department of Homeland Security boss and Arizona governor, is not exactly a model of accountability.

As we noted, UC bosses spent $504 million on a computer system that was supposed to cost $156 million. They also jacked up tuition while hiding $175 million in reserves. UC bosses also hiked administrative spending by 28 percent over three years, but without any method to track expenses. And so forth.

The UC regents should show Napolitano the door but she keeps her job despite miserable performance. Meanwhile, if underperforming Linda Katehi is to be a professor she should be paid like one. As it stands, Katehi and Napolitano model the waste inherent in the UC system.

California Waterboards Property Rights

Tuesday August 1st, 2017   •   Posted by K. Lloyd Billingsley at 5:24am PDT   •  

August is National Water Quality Month and that might prompt a meditation on agencies such as California’s State Water Resources Control Board. The Board’s five full-time members are appointed by the governor and “the mission of the Water Board is to ensure the highest reasonable quality for waters of the state, while allocating those waters to achieve the optimum balance of beneficial uses.” Sounds good, but lately the unelected Board has been displaying some mission creep.

Federal Waters of the United States (WOTUS) policy had been limited to navigable bodies but in recent years federal regulators have expanded their reach into vernal pools, ditches and such. The Obama administration expanded the rules in 2015 and as under this policy regulatory zealots can punish farmers for using their own land. As we noted, California farmer John Duarte faces millions of dollars in fines for plowing a wheat field that contained vernal pools. In June the Trump administration rolled back “wetlands” rules and EPA boss Scott Pruitt told reporters “We are taking significant action to return power to the states and provide regulatory certainty to our nation’s farmers and businesses.” The State Water Resources Control Board, on the other hand, wants to deploy wetlands policy even stricter than the previous federal administration.

According to a Sacramento Bee report, the Board is proposing a “Waters of the State” rule that “would protect a broad array of wetlands including certain small streams and creeks, and a greater share of California’s vernal pools.” Homebuilders, farmers and business groups charge that the regulations “would create more red tape, higher costs and fewer rights for landowners.”

Reed Hopper of the Pacific Legal Foundation (PLF) is on record that the proposed rules could give the state considerably more power than the federal government. That is doubtless the intention of the unelected board, which is not just about ensuring water quality and “optimum balance of beneficial uses.”

Meanwhile, PLF is representing John Duarte, now who is attempting to have his case tossed on the grounds that the Army Corps of Engineers lacked the authority to sue him and the EPA chose not to do so.

Uniform Waste at the DoD

Monday July 31st, 2017   •   Posted by Craig Eyermann at 6:53am PDT   •  

Uniforms are a big deal at the U.S. Department of Defense for outfitting the members of the nation’s military branches, particularly its Battle Dress Uniforms (BDUs), which incorporate camouflage among other technologies to help protect the lives of American service members who will be engaged in combat operations.

As part of that mission, the Pentagon also helps outfit the service members of other nations’ militaries, particularly those that provide bases and other assistance to U.S. military forces, but which lack the resources to adequately provision their forces. The justification for providing that kind of military aid is that if the DoD didn’t step in, it would increase the risk to the lives of the American troops they are supporting.

Being a large government bureaucracy, it is perhaps not surprising to learn that the DoD periodically bungles that basic task. What is surprising is the price tag for when it does, as we just found out in the last week when $28 million worth of uniforms provided by the Pentagon to outfit Afghanistan’s army was wasted because they were produced with the wrong kind of camouflage to provide effective camouflage protection in that country. Tara Copp of the Military Times reports:

Defense Secretary Jim Mattis scolded top defense officials for a “complacent” mode of thinking that allowed $28 million to be wasted on Afghan army uniforms that were inappropriate for fighting in Afghanistan.

The Special Inspector General for Afghanistan Reconstruction exposed the waste in June when it found that the Pentagon’s decision to procure a dark forest-patterned uniform for the Afghan army was incongruous with the country’s largely desert environment. The Combined Security Transition Command-Afghanistan selected the dark uniform in 2008, SIGAR found, without determining whether it was right for Afghanistan. DoD had purchased more than 1.3 million of these uniforms as of June, SIGAR reported.

Moreso, the SIGAR found, DoD bypassed its own digital patterns it owned and contracted a firm whose proprietary rights over the forest pattern significantly increased the cost of the shirt and pants purchases.

According to the McClatchy news service, the Pentagon’s near decade-long period of wasteful spending to outfit Afghanistan’s military to assist U.S. forces operating in that country has led to a criminal investigation.

“This...procurement demonstrates what happens when people in the government don’t follow the rules,” John Sopko, the Special Inspector General for Afghanistan Reconstruction, told a House Armed Services subcommittee on Tuesday. “These problems are serious. They are so serious that we started a criminal investigation related to the procurement of the (Afghan National Army) uniforms.”

According to the special IG, the military bought more expensive, proprietary “woodland patterns” for the Afghan National Army uniforms instead of using the Defense Department’s own patterns for free, even though only 2.1 percent of the country’s total land area is covered with forest.

“This is about reason and common sense,” Sopko told McClatchy after the hearing. “It’s not fair to the taxpayer and it’s not fair to the poor Afghan walking around with a target on his back that says ‘shoot me.’”

Nor would it be fair to U.S. service members conducting operations with Afghan forces within that country’s rough environment, whose positions could be given away by the greater visibility of the uniforms provided by the Pentagon to their foreign colleagues.

The Special Inspector General for Afghanistan Reconstruction’s report is available online.

For its part, the U.S. House of Representatives voted last week to bar any purchases of uniforms for Afghanistan’s army in the U.S. government’s 2018 fiscal year budget for the DoD.

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