February 08, 2007

Seemed like a good idea at the time:
The Federal Reserve sent record payouts of more than $4 billion in cash to Baghdad on giant pallets aboard military planes shortly before the United States gave control back to Iraqis, lawmakers said Tuesday.

The money, which had been held by the United States, came from Iraqi oil exports, surplus dollars from the U.N.-run oil-for-food program and frozen assets belonging to the ousted Saddam Hussein regime.

Bills weighing a total of 363 tons were loaded onto military aircraft in the largest cash shipments ever made by the Federal Reserve, said Rep. Henry Waxman, chairman of the House Committee on Oversight and Government Reform.

"Who in their right mind would send 363 tons of cash into a war zone? But that's exactly what our government did," the California Democrat said during a hearing reviewing possible waste, fraud and abuse of funds in Iraq.

On December 12, 2003, $1.5 billion was shipped to Iraq, initially "the largest pay out of U.S. currency in Fed history," according to an e-mail cited by committee members.

It was followed by more than $2.4 billion on June 22, 2004, and $1.6 billion three days later. The CPA turned over sovereignty on June 30.

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