US Embassy Baghdad: SFRC Report Says Mission Cost May Be Its Death Knell

Below is an excerpt from the SFRC’s Minority Staff Trip report on Iraq that went online on April 2012 for the 112th Congress (see Iraq Report: Political Fragmentation and Corruption Stymie Economic Growth and Political Progress).

The military’s withdrawal uncorked a new wave of political wrangling and violence, and it has also left the U.S. Department of State in charge of a ground structure that more resembles a military metroplex than an embassy campus. Ambassador Jim Jeffrey, himself once an Army officer, understands that the operation is unsustainable and is looking for ways to shrink the footprint and the budget, which will have an annual cost of about $6.5 billion.
The State Department is running the Embassy in Baghdad, consulates in Basra and Erbil, the equivalent of a small combat hospital, several health clinics, an airline, airfields and all of the logistical elements involved. There are some dozen sites around the country. The price tag for operating all of this (including development and assistance programs) will be around $6.5 billion for 2012, well above that cost of any other U.S. diplomatic mission—but far lower than the more than $40 billion in U.S. spending budgeted for fiscal 2011 in Iraq.

The civilian mission numbers about 1,800 USG employees, backed by about 14,000 contractors of various stripes (care, feeding, maintenance, security, NGOs, and USAID implementing partners). The bulk of the $6.5 billion is tied up in operations and security. Overhead accounts for upward of 80 percent of costs according to the Special Inspector for Iraqi Reconstruction (SIGIR). Such costs are unsustainable. The high cost comes under greater scrutiny when effects are measured. Because of pushback from the GOI, and the challenging security conditions, many planned programs are not being executed. Embassy staff are frustrated by their inability to have an impact.

Ambassador Jeffrey may have been only slightly exaggerating when he told staff that trucking food in from Kuwait to provide meals for personnel costs 50 times what it would if the Embassy were making purchases on the local economy. In Baghdad, core Embassy staff are housed in fully furnished apartments—down to ironing boards, vacuums, pots, pans, plates and glassware—yet the Embassy has maintained the Army way of feeding the troops: providing, at no cost to all assigned personnel, three meals a day cafeteria style, with four or five different lines of cuisine choices. Ambassador Jeffrey inherited a huge military operation. He expressed that he had little choice but to continue operating in the same fashion, although he was fully aware of the need to shed overhead costs or programs, and he would rather shed costs.

Staff was pleased to see that Consulate General Erbil is leading in this respect already. Although it, too, provides meals free-of charge for its staff, but via meal vouchers which are redeemed at a local establishment that is within the security perimeter. There is also a minimart that sells basic groceries. This allows many to take meals (particularly breakfast) in their own apartments. And because the security environment is more benign, staff can even stop for lunch while out in town for a meeting. CG Erbil has also begun hiring guards from the local population, something State does at posts around the world.

Among its recommendations, shrinking further the USG footprint in the country:

Currently numbering 10 or 11 sites, the United States Government should reduce or consolidate the number of sites from which it is operating in Iraq. Each site requires a cadre of static guards and support personnel that add exponentially to the cost of the Iraq operation.  In and around Baghdad, no meaningful downsizing can occur if the Embassy has to continue to control the sprawling expanse of real estate for which it is currently responsible, including six separate sites in Baghdad alone. The Department must look for ways to shrink its footprint. One option would be to close FOB Union III, which exclusively houses the OSC–I mission. Those offices should transition to the buildings that were originally constructed for that purpose on the Embassy campus.

Read in full here (pdf download).

Domani Spero