Senator Collins Calls For End To 'Blank Checks To Baghdad'

Press Release

SENATOR COLLINS CALLS FOR END TO 'BLANK CHECKS TO BAGHDAD'

Senators Press Administration, Senate Leaders for U.S. Policy that Would Require Iraq to take Greater Responsibility for its Financial Future

During a recent press conference on Capitol Hill, Senator Susan Collins joined with Senators Ben Nelson (D-NE) and Evan Bayh (D-IN) in calling on the Administration and Senate leaders to adopt policy that would require the Iraqi government to direct a portion of its massive oil revenues to help pay its reconstruction and stabilization costs. Additionally, the Senators are working on legislation that would require many of these costs to be provided to the Iraqis in the form of a loan, to be repaid to the American taxpayer.

In letters to Defense Secretary Robert Gates, Secretary of State Condoleezza Rice and to Senate Leaders, the Senators wrote, "The time has come to end this blank check policy and require the Iraqis to invest in their own future. We believe that it is time for Iraq to take greater responsibility for the costs of its reconstruction and stabilization. We are pleased that the Administration agrees and that certain steps are underway to require Iraq to pay some of the war and reconstruction costs."

Senator Collins said, "There is simply no reason for the U.S. to continue paying for things such as the cost of the salaries for the Sons of Iraq, for the training and equipping of the Iraqi Security Forces, and for covering the cost of the fuel we use in Iraq given this boon in oil revenue. I believe that our reconstruction assistance should be provided to the Iraqi people in the form of a loan, to be repaid in the future to the American taxpayer."

Senator Nelson further said, "With Iraq's projected budget surplus estimated at $60 billion and the United States grappling with an ever-growing debt and spiraling deficits, we must look for solutions to end Iraq's cycle of dependence on American taxpayers. Iraq must take more responsibility for its own future by shouldering more of the costs for reconstruction and security. The era of the Administration's blank check policy for Iraq must come to an end."

Senator Bayh said, "It's time to stop payment on this blank check to Baghdad. The Iraqi government should be required to spend every penny of Iraqi oil profits before the American people are asked for another red cent to rebuild Iraq. We cannot continue to spend billions of our own money on reconstruction while the Iraqi government sits on surpluses."

Text of the Senators' letter to Secretary Gates is as follows. Similar letters were sent to Secretary Rice and Senate leaders.

April 17, 2008

Secretary Gates:

The war in Iraq has come at an enormous cost to this nation in both lives and treasure. Recent estimates have placed the financial costs of the war at about $12 billion a month, a cost borne by present and future American taxpayers.

Over the past several weeks, media and government reports have provided a clearer picture of Iraq's improved financial situation. As a result of record-high oil prices, Iraq is expected to experience a significant financial windfall through oil revenues that has been estimated to be almost $56 billion. Further, the Government of Iraq has invested almost $30 billion dollars in banks across the globe, including the United States.

The time has come to end this blank check policy and require the Iraqis to invest in their own future. We believe that it is time for Iraq to take greater responsibility for the costs of its reconstruction and stabilization. We are pleased that the Administration agrees and that certain steps are underway to require Iraq to pay some of the war and reconstruction costs.

In 2003, Deputy Secretary of Defense Paul Wolfowitz said, "We're dealing with a country that can really finance its own reconstruction, and relatively soon." Instead, over the last five years, the United States has financed Iraq's reconstruction for more than $45 billion. While it appears that the U.S. share of level reconstruction funding has declined, the American taxpayers are still subsidizing projects that should funded by the Iraqis themselves.

To address this problem, we are working on legislation that will require many of these costs to be provided in the form of a loan. While it is critical that funding for reconstruction and the needs of our troops continue to be available in an accessible manner, there is no reason why our government cannot negotiate a loan repayment/reimbursement plan with the Iraqis. In addition to loans, we believe that Iraq should make direct payments and/or reimbursements for our costs where possible, including the cost of fuel consumed in Iraq by American forces.

Last week, during your appearance before the Senate Armed Services Committee, several members of the Committee raised the idea of the Iraqis shouldering more responsibility for the costs of the war, including in the form of loans. You indicated your commitment to take these ideas back to the President. We appreciate that commitment. As the legislative process moves forward, we would like to ask both the Department of Defense and the Department of State to identify additional areas of spending for which the Iraqi government should take greater responsibility.

We ask that you work with us on ensuring that American taxpayers do not continue to foot the bill for Iraq's reconstruction. Simply put, we do not believe that it is appropriate for Iraq to reap a surplus at a time when the United States is struggling with high energy costs and bearing billions of dollars of costs in order to bring stability to Iraq. It is not our intent to punish or harm the government of Iraq; rather, we believe this is an opportunity for Iraq to demonstrate its desire to act independently from the United States. Ultimately, we hope to see Iraq invest in itself and reduce the burden to the American taxpayer.

Again, thank you for your commitment to address this issue. We thank you for your service and look forward to working with you.

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