The embattled US Agency for International Development has engaged in “willful sabotage of congressional oversight” over recent years while doling out taxpayer dollars to groups that overbilled the US and possibly gave funds to terrorists, Sen. Joni Ernst alleged.
The Republican Hawkeye State senator and Senate DOGE Caucus chair, listed a slew of examples on social media this week on why “USAID is one of the worst offenders of waste in Washington.”
This includes $2 million in funding related to Moroccan pottery classes, some $2 million backing trips to Lebanon, over $1 million to fund research in the Wuhan lab, $20 million to make a Sesame Street in Iraq and $9 million in humanitarian aid that “ended up in the hands of violent terrorists.”
The White House has similarly outlined “waste and abuse” in USAID as the Trump administration eyes a dramatic overhaul of the agency and has explored folding it into the State Department.
The administration pointed to USAID spending $2 million to fund LBTQ activism and sex changes in Guatemala, $6 million for tourism in Egypt, $32,000 on a “transgender comic book” in Peru, $2.5 million backing electric vehicles in Vietnam, money that backed “personalized” contraceptives in developing countries and more.
In a Wednesday letter to Secretary of State Marco Rubio, Ernst (R-Iowa) cited her concerns about wasteful spending and recounted obstruction she faced from USAID.
In one example she highlighted, an inspector general discovered that Chemonics, a USAID contractor, overbilled the feds by “as much as $270 million through fiscal year 2019” and was caught “possibly offering kickbacks to terrorist groups.”
Chemonics had been heavily involved in a $9.5 billion USAID initiative to beef up global health supply chains, which ultimately ended in dozens of arrests and indictments over the resale of agency-funded products on the black market.
“Overbilling the United States taxpayer, while very serious, is not the most eyebrow-raising allegation Chemonics faces,” she added. “The firm is also alleged to have collaborated with a terrorist group and avowed enemy of the United States, bribing the Taliban while carrying out USAID- designated programs in Afghanistan.”
Last December, Chemonics agreed to pay $3.1 million in a settlement with the government over “fraudulent” billing.
But Ernst stressed that the Chemonics ordeal is part of a larger picture of USAID’s poor financial stewardship and slammed the agency for stonewalling oversight requests.
“Time and time again, the agency has been unwilling to provide accurate documents in response to my investigations into its frivolous expenditures,” Ernst groused to Rubio about USAID. “The agency has engaged in a demonstrated pattern of obstructionism.”
Ernst, who claims to have been threatened with legal action from USAID during her oversight efforts, alleged that the agency misled her staff at times.
Last September, she reached an agreement with USAID to parse through data on US funding to war-torn Ukraine. They insisted that her team look through the document in a Sensitive Compartmented Information Facility, typically used for classified information.
But her staff quickly “discovered the documents were not classified.”
“In a desperate attempt to limit congressional oversight of public information, USAID demonstrated intentional abuse of a system designed to keep our nation’s secret information secure,” Ernst complained in her letter to Rubio.
She noted that her team also learned that over 5,000 Ukrainian businesses garnered taxpayer funds of up to $2 million each.
“Many of these initiatives … claim to enhance Ukraine’s wartime posture by increasing Ukrainian businesses’ sales in new markets,” she wrote. “Instead, the American people have funded extravagant trade missions and vacations for Ukrainian business owners to film festivals and fashion weeks across the glamorous [capitals] of Europe.”
Another example of her team being lied to by the USAID occurred three years ago when she reached out for data on the agency’s Negotiated Indirect Cost Rate Agreements (NICRAs) with grant recipients that permitted them to use funding on miscellaneous expenses.
“The agency responded to the request for information by claiming that, ‘USAID does not have a system to track or report on this data, as it is not possible to compare indirect costs between for-profit and nonprofit organizations at the rate level,’” Ernst recounted to Rubio.
In 2023, her staff flagged a publicly reported NICRA database, which USAID later acknowledged was really, but claimed it was “legally restricted from sharing an implementing partner’s proprietary information, including its NICRA.”
USAID then later backpedaled and said that it is limited in its ability to share such information “outside the scope of a formal oversight request by a committee of jurisdiction.”
Eventually, the House Foreign Affairs Committee intervened and requested the NICRA data.
“In the wake of this series of significant misjudgments and oversight obstruction by USAID, it is of the utmost importance to conduct a full and independent analysis of the recipients of USAID assistance,” Ernst added.
“Americans deserve answers about how their tax dollars are being spent abroad.”
Department of Government Efficiency (DOGE) boss Elon Musk has taken aim at USAID in recent days, and Rubio announced this week that he has been named the agency’s acting director.
Rubio said he is delegating much of the day-to-day tasks of leading the USAID as the Trump administration continues to further explore its options. The secretary of state blasted USAID as “a completely unresponsive agency.”
The Post has reached out to USAID and Chemonics for comment.
