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Much of $60B from U.S. to rebuild Iraq wasted, special auditor's final report to Congress shows

In too many cases, Bowen concluded, U.S. officials did not consult with Iraqis closely or deeply enough to determine what reconstruction projects were really needed or, in some cases, wanted. As a result, Iraqis took limited interest in the work, often walking away from half-finished programs, refusing to pay their share, or failing to maintain completed projects once they were handed over.

Deputy Prime Minister Hussain al-Shahristani, a Shiite, described the projects as well intentioned, but poorly prepared and inadequately supervised.

The missed opportunities were not lost on at least 15 senior State and Defense department officials interviewed in the report, including ambassadors and generals, who were directly involved in rebuilding Iraq.

One key lesson learned in Iraq, Deputy Secretary of State William Burns told auditors, is that the U.S. cannot expect to "do it all and do it our way. We must share the burden better multilaterally and engage the host country constantly on what is truly needed."

Army Chief of Staff Ray Odierno, who was the top U.S. military commander in Iraq from 2008 to 2010, said, "It would have been better to hold off spending large sums of money" until the country stabilized.

About a third of the $60 billion was spent to train and equip Iraqi security forces, which had to be rebuilt after the U.S.-led Coalition Provisional Authority disbanded Saddam's army in 2003. Today, Iraqi forces have varying successes in safekeeping the public and only limited ability to secure their land, air and sea borders.

The report also cites Defense Secretary Leon Panetta as saying that the 2011 withdrawal of American troops from Iraq weakened U.S. influence in Baghdad. Panetta has since left office: Former Sen. Chuck Hagel took over the defense job last week. Washington is eyeing a similar military drawdown next year in Afghanistan, where U.S. taxpayers have spent $90 billion so far on rebuilding projects.

The Afghanistan effort risks falling into the same problems that mired Iraq if oversight isn't coordinated better. In Iraq, officials were too eager to build in the middle of a civil war, and too often raced ahead without solid plans or back-up plans, the report concluded.

Most of the work was done in piecemeal fashion, as no single government agency had responsibility for all of the money spent. The State Department, for example, was supposed to oversee reconstruction strategy starting in 2004, but controlled only about 10 percent of the money at stake. The Defense Department paid for the vast majority of the projects -- 75 percent.