China is Bullying India and Australia over Maldives for Silk Road

Posted on February 20, 2018February 20, 2018 by Denise Simon

China is bullying India, Australia and the United States to change the balance of power globally. Anyone paying attention?

Maldives crisis: China sends a naval task force to muscle India, Australia out of power game

CHINA is muscling its way into Australia’s backyard. With an island paradise deep in crisis, the superpower sees a chance.

CHINESE warships have entered the Indian Ocean, marking a significant shift in regional power. They’re there to keep India away from Beijing’s interests in the strife-torn Maldive Islands.

And their presence has implications for Australia.

Naval posturing is nothing new. Gunboat diplomacy has been a major player in great power games of thrones for centuries.

But it is odd for it to be played out so close to home.

A scattering of pristine coral islands in the Indian Ocean is becoming the next flash point between New Delhi and Beijing.

The Maldives islands are in the throes of a constitutional crisis.

The little democracy has traditionally been part of India’s “sphere of influence”. And the eastern Indian Ocean is, of course, of significant strategic importance to Australia.

But recently a new kid has arrived on the block.

And now Beijing’s grown enough confidence to let its presence be felt in the area’s affairs.

A naval force of at least one modern destroyer, a frigate, an amphibious assault ship and a support tanker entered the Indian Ocean last week. It is believed destined to linger off the scenic scatterings of coral, sand and palm trees.

International affairs analysts believe they’re there to stop India from intervening.

Beijing, after all, has big plans for these little islands. And it doesn’t want the locals getting in the way.

Blue skies. White sand. Clear water. The international tourist resorts of the Maldives have been sidelined by the archipelago’s strategic importance. Picture: AFPSource:AFP

TROUBLE IN PARADISE

These islands are unlikely to appear on anyone’s radar — unless you’re after an idyllic island paradise getaway.

But the Maldives have suddenly become the centre of a struggle for international influence.

It’s in the grip of a constitutional crisis.

Opposition leader Mohamed Nasheed recently dared to state that China was “buying up the Maldives” through President Abdulla Yameen. He highlighted the tiny nation was massively in debt to Beijing, and faced seizure of public assets — such as ports — to help pay it back.

It wasn’t long after this Yameen had key opposition figures arbitrarily arrested.

Then Yameen sprung a state of emergency on his people on February 5. It came as the Supreme Court ordered the opposition leaders be released as their arrests had been politically motivated.

So Yameen sent his security forces to arrest the Supreme Court’s judges.

Maldivian police detain a protester demanding the release of political prisoners during a protest in Male, Maldives. Picture: APSource:AP

This has Beijing bothered. It has invested big in a major port project there.

But it’s not the money it’s worried about.

Nor is it the potential collapse of a fragile democracy.

It has implications for its grand ‘One Belt, One Road’ infrastructure campaign. This is intended to vastly expand China’s economic network — and influence — through Asia, the Middle East and into Europe.

“Although traditionally within India’s strategic sphere, in recent years the Maldives has become unstable, impoverished and increasingly desperate,” says the Lowy Institute’s Dr David Brewster.

“Indeed, much of the nation could soon disappear beneath rising sea levels. We may soon see China’s ‘magical island-building ship’ pay a visit to the Indian Ocean.”

India has always been a roadblock in these plans. But now Beijing’s bypass via the Maldives may be in trouble.

Which is why it wants to New Delhi to keep out.

A screen capture of Chinese media footage showing the naval task force currently operating in the eastern Indian Ocean. It includes an amphibious assault ship, a guided missile destroyer and frigate, and a supply ship. Picture: CCTV7Source:Supplied

BELT AND ROAD AMBITIONS

Every day, more than 40 million barrels of oil passes through the strategic “chokepoints” at either end of the Indian 0cean. This includes the Straits of Hormuz, the Gulf of Aden and the Malacca Strait.

All pass through the waters between the Maldives and Ceylon, to India’s south.

It’s a vital arterial supply line. Not least of all to Beijing.

Chinese media is boasting about its new naval presence in the Indian Ocean. It’s been proudly displaying photos and video of its modern ships refuelling and reprovisioning at sea on a mission that is certainly a long way from home.

It’s by no means the first time a Chinese task force has entered the Indian Ocean.

This time things may be different.

The Australian Strategic Policy Institute says Beijing’s infrastructure activity is part of a determined strategy to extend its influence across the Indian Ocean — at the expense of India.

“India has long been concerned about China’s growing maritime interest in the Indian Ocean region,” says ASPI executive director Peter Jennings. “Over the last decade the PLA-Navy has transited through the region many times to participate in UN and EU backed counter-piracy missions off the Horn of Africa. China has established its first overseas military base at Djibouti and is using the ‘One Belt One Road’ strategy to build extensive port infrastructure in Pakistan and Sri Lanka.”

In that context, the timing of this task force’s arrival in the eastern Indian Ocean is likely to be significant.

A Chinese Type 052D guided missile destroyer tests its antimissile gatling gun during a recent exercise. One of these potent warships is among Beijing’s task force in the eastern Indian Ocean. Picture: XinhuaSource:Supplied

“Sending warships to operate off the Maldives is a new and concerning development, because it shows that China is trying to exercise influence over a small state more usually within India’s strategic view. New Delhi will read this as a worrying move. It will intensify strategic competition and increase mistrust between China and India.”

Some international observers had been expecting New Delhi to send its own task force to exert influence over the tiny islands’ fate. Instead, it has taken a hands-off approach through an appeal to the United Nations. It wants help to help pressure Yameen into restoring democratic values.

So Beijing has stepped into the power vacuum with a task force of its own.

But does India have a strong enough presence to keep Beijing out of its own backyard?

The presence of four modern Chinese warships near the Maldive Islands has significant implications for the balance of power in the Indian Ocean. Picture: CCTV7Source:Supplied

OPTIONS OPEN

The chances of any clash between India and China are very low.

But the true impact of the Beijing’s warships is being felt in the corridors and back rooms of power throughout the region.

The warships give Beijing options. And status.

If things take a sudden turn for the worse in the Maldives, it can present itself as an international hero by quickly landing its troops in a “humanitarian intervention”.

It could lift its own citizens out of trouble — and those of other nations. It could impose in a “peace keeping” force to support the local political entity of its choice.

That such acts would irreparably damage India’s influence and status is an unspoken benefit.

It would also cement Beijing’s intimidating presence in what is a key “chokepoint” for its “belt” project.

The under-construction China Maldives Friendship Bridge is pictured near the city of Male. The international community has censured Maldives President Abdulla Yameen for imposing a state of emergency. Picture: AFPSource:AFP

If, however, the Maldives crisis does not worsen, the mere presence of Chinese warships acts as a deterrent to Indian intervention. It’s also a neon-sign of Beijing’s determination to wield its new-found influence worldwide.

The force Beijing appears to have deployed may seem small. But it is capable.

The Type 052D guided missile destroyer (Luyang-III class) is among its most modern combat ships. With a crew of 280 and weighing some 7500 tons, it carries a helicopter, land-attack cruise missiles, surface-to-air missiles, surface-to-surface missiles and anti-submarine missiles.

The Type 054A frigate (Jiangkai II) is one of more than 21 of these modern frigates deployed by Beijing. It is a stealthy design, intended primarily to supplement the air defence of a task force, though it also has some anti-surface and submarine capability.

The Type 071 amphibious transport dock is ideal for humanitarian relief — and landing forces of troops. It can carry a variety of amphibious assault vehicles and landing craft, along with two helicopters. But it also operates hospital and command-and-control facilities. It has accommodation for up to 800 troops.

It’s also backed-up by China’s 28th Anti-Piracy Task Force out of Africa. It’s believed to have wandered closer to the middle of the Indian Ocean in recent weeks.

Indian Navy personnel stand on the INS Vikramaditya, a modified Kiev-class aircraft carrier, similar to the aircraft carrier Liaoning operated by China. Picture: AFPSource:AFP

DEEP IMPLICATIONS

India has not been sitting idle. It has been modernising its own navy. Like China, it is one of just a few nations operating fixed-wing aircraft carriers.

Neither is currently operating near the Maldives.

But New Delhi has also just signed a deal with the Seychelles islands to establish a mid-Indian Ocean naval facility of its own.

“Despite these dramatic developments, the shape and future purpose of China’s naval presence in the Indian Ocean remains an open question,” Dr Brewster says. “We should not automatically assume that the Chinese navy intends to challenge the US Fifth Fleet, at least in the short term. China will remain at a big geographic disadvantage in the Indian Ocean.”

This is because it does not have the complex and extensive supply network that the other major international influence in the region — the US 5th Fleet — has.

But it’s working on it.

Royal Australian Navy ships HMAS Adelaide, Toowoomba and Darwin in formation as part of the Joint Task Group for Indo-Pacific Endeavour 2017. Picture: DefenceSource:Supplied

There’s also bound to be pushback.

“China’s move may reinforce a growing Indian interest to co-operate more closely with Australia,” Mr Jennings says.

“The idea of quadrilateral co-operation between India, Australia, Japan and the US — which was abandoned a decade ago because of worries it would be seen to contain China — is now firmly back on the agenda.

“It would be ironic if China’s rather amateurish attempts to build political influence in the Maldives led to enhanced co-operation between the democracies on Indian Ocean security.”

Diplomacy to Address Russian Olympic and War Cheating and Lies?

Posted on February 19, 2018February 19, 2018 by Denise Simon

C’mon really? The Russians cheat, steal and lie. Why would any Western ally trust any part of the Kremlin or operatives dispatched worldwide? Russian nefarious ‘active measure’ plots are global and so easy to achieve. The question is why?

The International Olympic Committee is no exception when it comes to going easy on Russia, buckling to pressure from Moscow. Russia has made legitimate and clean athletes in the games a mockery. The IOC was forced to defend its decision to include Russian athletes in these Pyeongchang Games on Monday morning after curler Alexander Krushelnytsky reportedly failed a drug test, jeopardizing the bronze medal he won last week in mixed doubles and inviting increased scrutiny on the IOC’s handling of the situation.

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First: a Russia-linked group calling itself “Fancy Bears” published a set of apparently stolen emails. They purportedly belong to officials from the International Olympic Committee, the United States Olympic Committee, and third-party groups associated with the organizations. It’s not the first time Russia has lashed out at the IOC and the anti-doping agencies in the last few years. And with a month left until the games begin, it may not be the last.

The emails appear to span from the end of 2016 to the spring of 2017, and focus on correspondence between antidoping investigators who helped uncover a wide-scale, systematic doping scheme carried out by Russian athletes. It’s not clear yet whether the emails are entirely authentic; Russian hacking groups have snuck false information into their leaks before. But the World Anti-Doping Agency Wednesday indirectly acknowledged that the emails were real, but not current.

“The Fancy Bears are a criminal organization which seeks to undermine the work of WADA and its partners,” says WADA spokesperson Maggie Durand. “Everything that they have posted today is dated.”

The hack appears to be retaliation for kicking the Russia out of 2018 PyeongChang games, at which only a handful of the country’s athletes will be allowed to compete. More here.

Second: (Reuters) – A Russian medalist at the Pyeongchang Winter Olympics is suspected of having tested positive for a banned substance, a source at the Games said on Sunday, in a potential major blow to Russia’s efforts to emerge from a drug-cheating scandal. Alexander Krushelnitsky, a bronze-medalist along with his wife in mixed-doubles curling, is suspected of having tested positive for meldonium, the source said. Meldonium increases blood flow which improves exercise capacity in athletes. Russia has been accused of running a state-backed, systematic doping program for years, an allegation Moscow denies. As a result, its athletes are competing at Pyeongchang as neutral “Olympic Athletes from Russia” (OAR).

Third: Seems to be a systemic condition when it comes to doping by Russian athletes regardless of the sport and or location. Remember Maria Sharapova and tennis? In 2017, Maria Sharapova makes her return after a 15-month suspension for use of meldonium this week, with the tennis star serving as the most high-profile of those sanctioned for use of the drug. After hundreds of positive tests in Olympic sports last year, Sharapova remains one of the relative few to be suspended for its use. While the facts of her case differ from the issues the World Anti-Doping Agency faced in determining how long it stays in an athlete’s body, her presence among those testing positive drew attention to WADA’s ban of the drug.

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Fourth: And it goes to the militant battlefield as well. Russia and the United States have clashed at the United Nations Security Council over allegations the Syrian government has again used chemical weapons in rebel-held areas of the country.

U.S. Ambassador Nikki Haley on February 5 accused Russia of blocking an investigation of possible chemical weapons use by President Bashar al-Assad’s army in attacks in rebel-held Eastern Ghouta over the weekend despite “obvious evidence from dozens of victims.”

“Russia has delayed the adoption of this statement, a simple condemnation of Syrian children being suffocated by chlorine gas,” Haley said. “This council has been outspoken on ending Syria’s use of chemical weapons, and yet, they continue.”

Russia, which has been conducting military operations in support of Assad since September 2015, rejected the allegations as “slander.”

Finally: If anyone watched the hearing and ODNI Dan Coats summary –>

The nation’s top intelligence officials said Tuesday that Russia is targeting the 2018 elections as it seeks to undermine America’s political process and sow partisan division with cyber attacks and other digital disruption.

“Frankly, the United States is under attack,” Director of National Intelligence Dan Coats told the Senate Intelligence Committee, adding that Russia is attempting to “degrade our democratic values and weaken our alliances.”

In unequivocal language, Coats said Russian President Vladimir Putin was emboldened by Russia’s interference in the 2016 presidential elections and is targeting the midterms.

“There should be no doubt that (Putin) views the past effort as successful,” said Coats who was joined Tuesday by the nation’s other top intelligence officials, including CIA Director Mike Pompeo, National Security Agency Director Mike Rogers and FBI Director Christopher Wray.

The national intelligence director’s comments came against the backdrop of congressional and criminal investigations into Russia’s alleged interference in the presidential election and whether the Kremlin coordinated its activities with Donald Trump‘s campaign.

State Dept Proposes Lead Agency on Economic/Cyber Bureau

Posted on February 6, 2018February 6, 2018 by Denise Simon

This sounds great until one considers there is no lawful cyber policy against any nation, rogue or otherwise where there are consequences for hacks, malicious malware or cyber theft. Meanwhile, all cyber units within the Federal government as well as independent outside corporations are well aware of China, North Korea, Russia and proxies are the constant and proven cyber threats to the United States without punishment.

Further, there are two details that are omitted in the summary below, the global actions of cybercurrencies and how governments are plotting regulations but more the global economic agenda. There is no way to stop a borderless world.

The 2016 State Department posture on foreign cyber threats is here.

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Tillerson proposes new unified bureau at State to focus on cyber

Secretary of State Rex Tillerson is proposing the consolidation of two separate offices at the State Department to form a single bureau that will focus on a wide range of cyber issues.

A State Department spokesperson told The Hill that the two offices, the Office of the Cybersecurity Coordinator and the Bureau of Economic Affairs’ Office of International Communications and Information Policy, would be unified in order to form the proposed Bureau for Cyberspace and the Digital Economy.

“The combination of these offices in a new Bureau for Cyberspace and the Digital Economy will align existing resources under a single Department of State official to formulate and coordinate a strategic approach necessary to address current and emerging cyber security and digital economic challenges,” Tillerson said in a Tuesday letter to House Foreign Affairs Committee Chairman Ed Royce (R-Calif.).

“The Department of State must be organized to lead diplomatic efforts related to all aspects of cyberspace,” the secretary added.

The decision comes after Tillerson faced scrutiny from both parties last year over his decision to fold the standalone Office of Cybersecurity Coordinator into an economic-focused bureau as part of his broad efforts to reorganize the agency.

Royce first relayed the news during a cyber diplomacy briefing on Tuesday that focused on the need to engage the international community on cybersecurity-related issues.

“The proposal will elevate the stature of the department official leading cyberspace policy to one that is confirmed by the U.S. Senate — an assistant secretary — to lead high-level diplomatic engagements around the world,” the secretary argued.

Last year, Royce introduced a bill, titled the Cyber Diplomacy Act, that seeks to restore a State Department office specifically focusing on cyber diplomacy efforts. The House passed the bill last month, which also calls for the official leading the cyber office to have the rank of ambassador.

Royce said Tillerson’s proposal is a “welcomed” move, but continued to vouch for the Cyber Diplomacy Act to “help keep America safe and strong.”

“Cyberspace is vital to America’s national security, and to our economy. That’s why I have long called for the State Department to have a high-ranking diplomat who can confront the full range of challenges we face online,” Royce said in a statement in response to Tillerson’s letter.

“The Foreign Affairs Committee will continue to work with the department and our colleagues in the Senate to ensure this assistant secretary and bureau is empowered to engage on the full range of cyber issues, dealing with security, human rights, and the economy,” he continued.

A State Department spokesperson said the proposal is part of an effort to spearhead cyber policy and address cybersecurity on a global scale.

“The State Department recognizes its leadership role of diplomatic efforts related to all aspects of cyberspace and the need to have an effective platform from which to engage relevant global stakeholders and exercise that leadership role,” the spokesperson said.

Under Tillerson’s proposal, the cyber bureau would seek to establish a “global deterrence framework” in an effort to outline how countries can respond when other nations “engage in malicious cyber activities.”

It would also seek to develop strategies against adversaries, promote programs that help with cyber threat prevention and responses, establish partnerships to keep the nature of the Internet open with a cross-border flow of data and open lines of dialogue for diplomatic officials to further engage on such issues.

At the start of the hearing, Royce emphasized the importance of the State Department’s role in cybersecurity issues as other countries attempt to impose control over cyberspace.

“The department’s role becomes essential when you consider that it’s not just computer networks and infrastructure that the United States needs to protect. The open nature of the internet is increasingly under assault by authoritarian regimes, like China, that aggressively promote a vision of ‘cyber sovereignty,’ which emphasizes state control over cyberspace,” Royce said in his opening remarks.

Three cyber experts testified before the lawmakers for roughly three hours on Tuesday, including the State Department’s former top cyber diplomat.

Chris Painter, the agency’s former cybersecurity coordinator, had already emphasized the need for the State Department to assume a key role in cyber policy before Tillerson’s proposal became public.

“[G]iven the international nature of the threats and the technology itself, that the State Department should play a leading role in that effort and that effective cyber diplomacy,” Painter told the lawmakers.

“For the U.S. to continue to lead, as it must, cyber issues must be re-prioritized and appropriately resourced at the State Department. Moreover, it is important that the position of the individual leading these efforts be at a very high-level — not buried in the bureaucracy or reporting through any one functionally or perspective limited chain of command,” he added.

Under the proposal, an assistant secretary will lead the new bureau and report to the Under Secretary for Economic Growth, Energy and the Environment.

Painter praised Tillerson’s plan after Royce relayed Tillerson’s proposal at the hearing. But he argued that it “makes a lot more sense” for the assistant secretary to report to the undersecretary for political affairs rather than economic affairs.

“I applaud the fact that they’ve taken action. I think it’s great they’re elevating it. That’s exactly what should be done,” Painter said.

In July, Painter left his top position shortly before Tillerson alerted Congress about his plans to close the cybersecurity office.

Guilty Pleas, Human Smuggling Network Ft. Hood

Posted on February 6, 2018February 6, 2018 by Denise Simon

Primer:

BROWNSVILLE – A 51-year-old man in the U.S. illegally pled guilty to human smuggling charges.

Victoriano Zamora-Jasso is said to have supplied immigrants to 47-year-old Arnold Garcia, of Harlingen, who would then contact active-duty soldiers stationed at Fort Hood to help transport and deliver people in the county illegally further north.

The illegal operation took place from March to September of 2014.

The soldiers would conceal immigrants under their military gear to get through the immigration checkpoint in Sarita.

Garcia and all the soldiers were sentenced in 2015 and 2016.

Sentencing for Zamora-Jasso is scheduled for May 9.

He faces up to 10 years in prison and a possible $250,000 fine.

*** So, here is a case of an illegal alien that was granted access and permission to join the U.S. military….you know, taking an oath and stuff and he established a network at Ft.Hood….with other illegals? ….sheesh

Former Fort Hood, Texas, soldier pleads guilty to alien smuggling

US Army soldier was also previously deported

BROWNSVILLE, Texas — A solider based in Fort Hood, Texas, pleaded guilty Jan. 29 for his role in a conspiracy to transport and harbor illegal aliens, and illegally re-entering the United States after having been deported.

This guilty plea was announced U.S. Attorney Ryan K. Patrick, Southern District of Texas. This case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) with assistance from U.S. Customs and Border Protection’s (CBP).

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Victoriano Zamora-Jasso aka “Tata,” 51, from Mexico living in Houston made an appearance Jan. 29 in federal court on the eve of jury selection.

According to court records, in early 2014 Zamora-Jasso began supplying illegal aliens to Arnold Gracia, 47, from Harlingen, Texas. Gracia then made arrangements with others to transport the illegal aliens through the immigration checkpoint in Sarita, Texas. Gracia recruited the following then active-duty soldiers stationed at Ft. Hood to transport and deliver the illegal aliens further north: Brandon Troy Robbins, 23, from San Antonio; Eric Alexander Rodriguez, 24, from Odem, Texas; Christopher David Wix, 23, from Abilene, Texas; and Yashira Perez-Morales, 27, from Watertown, New York.

The conspiracy continued from about March through September 2014. The soldiers concealed the illegal aliens under their military gear in which they made many successful trips during the course of the conspiracy.

Zamora-Jasso was indicted in 2016 and arrested after a traffic stop in Conroe, Texas, in July 2017. In court, he admitted his involvement in the conspiracy. He also admitted that he is a previously convicted illegal alien who illegally re-entered the United States after having been deported in 2013.

Gracia and all the soldiers were previously sentenced in 2015 and 2016 with Gracia receiving a 73-month sentence; Robbins, Rodriguez, Wix and Perez-Morales received sentences of 20, 12 months, 12 months and a day, and five years’ probation to include an $8,000 fine.

Judge Rolando Olvera has scheduled Zamora-Jasso’s sentencing for May 9. At that time, he faces up to 10 years imprisonment and a possible $250,000 maximum fine. He remains in custody pending sentencing.

Assistant U.S. Attorneys Oscar Ponce and Angel Castro, Southern District of Texas, are prosecuting this case.

Swell, $800 Million Unaccounted for Defense Department

Posted on February 5, 2018February 5, 2018 by Denise Simon

Ah, an audit finally? Missing documentation but not the assets? What did the ledger show?

The Defense Logistics Agency is the Department of Defense’s logistics combat support agency, providing worldwide logistics support in both peacetime and wartime to the military services as well as several civilian agencies and foreign countries.

DLA employs about 25,000 employees. The agency’s headquarters is at Fort Belvoir, in Northern Virginia.

Exclusive: Massive Pentagon agency lost track of hundreds of millions of dollars

A damning outside review finds that the Defense Logistics Agency has lost track of where it spent the money.

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One of the Pentagon’s largest agencies can’t account for hundreds of millions of dollars’ worth of spending, a leading accounting firm says in an internal audit obtained by POLITICO that arrives just as President Donald Trump is proposing a boost in the military budget.

Ernst & Young found that the Defense Logistics Agency failed to properly document more than $800 million in construction projects, just one of a series of examples where it lacks a paper trail for millions of dollars in property and equipment. Across the board, its financial management is so weak that its leaders and oversight bodies have no reliable way to track the huge sums it’s responsible for, the firm warned in its initial audit of the massive Pentagon purchasing agent.

The audit raises new questions about whether the Defense Department can responsibly manage its $700 billion annual budget — let alone the additional billions that Trump plans to propose this month. The department has never undergone a full audit despite a congressional mandate — and to some lawmakers, the messy state of the Defense Logistics Agency’s books indicates one may never even be possible.

“If you can’t follow the money, you aren’t going to be able to do an audit,” said Sen. Chuck Grassley, an Iowa Republican and senior member of the Budget and Finance committees, who has pushed successive administrations to clean up the Pentagon’s notoriously wasteful and disorganized accounting system.

The $40 billion-a-year logistics agency is a test case in how unachievable that task may be. The DLA serves as the Walmart of the military, with 25,000 employees who process roughly 100,000 orders a day on behalf of the Army, Navy, Air Force, Marine Corps and a host of other federal agencies — for everything from poultry to pharmaceuticals, precious metals and aircraft parts.

But as the auditors found, the agency often has little solid evidence for where much of that money is going. That bodes ill for ever getting a handle on spending at the Defense Department as a whole, which has a combined $2.2 trillion in assets.

In one part of the audit, completed in mid-December, Ernst & Young found that misstatements in the agency’s books totaled at least $465 million for construction projects it financed for the Army Corps of Engineers and other agencies. For construction projects designated as still “in progress,” meanwhile, it didn’t have sufficient documentation — or any documentation at all — for another $384 million worth of spending.

The agency also couldn’t produce supporting evidence for many items that are documented in some form — including records for $100 million worth of assets in the computer systems that conduct the agency’s day-to-day business.

“The documentation, such as the evidence demonstrating that the asset was tested and accepted, is not retained or available,” it said.

The report, which covers the fiscal year that ended Sept. 30, 2016, also found that $46 million in computer assets were “inappropriately recorded” as belonging to the Defense Logistics Agency. It also warned that the agency cannot reconcile balances from its general ledger with the Treasury Department.

The agency maintains it will overcome its many hurdles to ultimately get a clean audit.

“The initial audit has provided us with a valuable independent view of our current financial operations,” Army Lt. Gen. Darrell Williams, the agency’s director, wrote in response to Ernst & Young’s findings. “We are committed to resolving the material weaknesses and strengthening internal controls around DLA’s operations.”

In a statement to POLITICO, the agency also maintained it was not surprised by the conclusions.

“DLA is the first of its size and complexity in the Department of Defense to undergo an audit so we did not anticipate achieving a ‘clean’ audit opinion in the initial cycles,” it explained. “The key is to use auditor feedback to focus our remediation efforts and corrective action plans, and maximize the value from the audits. That’s what we’re doing now.”

Indeed, the Trump administration insists it can accomplish what previous ones could not.

“Beginning in 2018, our audits will occur annually, with reports issued Nov. 15,” the Pentagon’s top budget official, David Norquist, told Congress last month.

That Pentagon-wide effort, which will require an army of about 1,200 auditors across the department, will also be expensive — to the tune of nearly $1 billion.

Norquist said it will cost an estimated $367 million to carry out the audits — including the cost of hiring independent accounting firms like Ernst & Young — and an additional $551 million to go back and fix broken accounting systems that are crucial to better financial management.

“It is important that the Congress and the American people have confidence in DoD’s management of every taxpayer dollar,” Norquist said.

But there is little evidence the logistics arm of the military will be able to account for what it has spent anytime soon.

“Ernst & Young could not obtain sufficient, competent evidential matter to support the reported amounts within the DLA financial statements,” the Pentagon’s inspector general, the internal watchdog that ordered the outside review, concluded in issuing the report to DLA.

The accounting firm itself went further, asserting that the gaping holes uncovered in bookkeeping procedures and oversight strongly suggest there are more.

“We cannot determine the effect of the lack of sufficient appropriate audit evidence on DLA’s financial statements as a whole,” its report concludes.

A spokeswoman for Ernst & Young declined to respond to questions, referring POLITICO to the Pentagon.

Grassley — who was fiercely critical when a clean audit opinion of the Marine Corps had to be pulled in 2015 for “bogus conclusions” — has repeatedly charged that “keeping track of the people’s money may not be in the Pentagon’s DNA.”

He remains deeply doubtful about the prospects going forward given what is being uncovered.

“I think the odds of a successful DoD audit down the road are zero,” Grassley said in an interview. “The feeder systems can’t provide data. They are doomed to failure before they ever get started.”

But he said he supports the continuing effort even if a full, clean audit of the Pentagon can never be done. It is widely viewed as only way to improve the management of such huge sums of taxpayer dollars.

“Each audit report will help DLA build a better financial reporting foundation and provide a stepping stone towards a clean audit opinion of our financial statements,” the agency maintains. “The findings also improve our internal controls, which helps to improve the quality of cost and logistics data used for decision-making.”