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This image released by the U.S. Army on March 27 shows a close-up view of ammunition case stamp in Afghanistan.
By Military analyst
updated 3/31/2008 4:55:10 PM ET 2008-03-31T20:55:10

Last week the New York Times published a story revealing that a company named AEY had been selling outdated ammunition from banned sources to the Defense Department for use in Afghanistan. And now it also appears that the company may have engaged in fraud as well. This is not just a simple case of an errant contractor.

The facts reported are as follows: AEY is apparently headed by a 22-year-old named Ephraim Diveroli, and the company was hired last year by the Department of Defense to supply about $300 million in ammunition to our allies in Afghanistan. Although AEY stated that the origin of the ammunition was Hungary, the Army believes that the corroded cartridges are decades-old and from China, and that AEY may have re-packaged the shipments to obscure their origin. Furthermore, it’s reported that AEY procured the ammunition through middlemen who have are suspected by the State Department to be engaging in illegal and corrupt arms trafficking.

The astonishing thing about this case is not that AEY looks as if it was engaged in war profiteering and fraud. Greedy people taking advantage of taxpayers is nothing new. One can predict with a high degree of certainty that such reprehensible behavior will continue as long as there is money to be made and unscrupulous people to make it.

And while it is not common that extremely young people run companies with hundreds of millions of dollars in sales, not one other comes to mind, in fact and it is not against the law to let contracts to such companies, and absent the alleged fraud this story would be one of commercial precociousness and uplifting, motivational leadership.

It’s not even shocking that the business seems to have been given to AEY without being subjected to competitive bidding, for the Department of Defense has done that often in the past. Nor is it an arresting revelation that the contract engaging AEY may have been vague, poorly drawn and containing loopholes, because we have seen this sort of thing before.

Instead, this case is a demoralizing window on the inefficient and dangerous dysfunction of government and of the inability of modern bureaucracy to conduct itself professionally.

Too much bureaucracy
With such an enormous number of federal employees, one would think that there is sufficient manpower to supervise the business of the government, no matter how complex, but it seems that the bureaucracy is either too cumbersome or improperly organized to perform vital functions. Maybe there are toomany, not too few bureaucrats, with the excess doing things that contribute nothing to our security and even make us less safe and cost American lives.

But the most scandalous aspect of all this is the appalling lack of leadership, the sheer inability or disinterest of people with responsibility to affect how we defend ourselves. There is no better example of this malfeasance than in this case, in which law that requires the State Department to monitor middlemen does not apply to the Defense Department. Common sense would dictate that the Congress would insure that Defense would be required to follow the same standards of supervision, or that absent leadership from Congress, the Defense Department would do it anyway.

But in government, common sense is a trait that one finds in dreadfully short supply.

Jack Jacobs is a military analyst and a retired U.S. Army colonel. He earned the Medal of Honor for exceptional heroism on the battlefields of Vietnam and also has three Bronze Stars and two Silver Stars.

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