Iraq Reconstruction

Great Debates
1

Recognizing that my prior thread, Lounsbury on Iraq & MENA: War, Politics, Economy & Related Questions (http://boards.straightdope.com/sdmb/showthread.php?postid=3318554#post3318554) has gotten rather excessively long, I think it is time to open a new thread. I haven’t a particular preference on closing the prior one or not, so if Mod think it is better, do so, else not.

Let me, for convenience, lay out what I’d like to tackle here. I’d like to tackle, in as non-ideological a manner as possible, the reconstruction of Iraq. While in the prior thread there was not much discussion insofar as I was reporting as much as not, I think here there is no small scope for debate in which I only have but a slight advantage due to my position. Very slight if any.

Politics, Economics and Related Questions then on reconstructing Iraq.

I also would like to reproduce an edited post in the prior thread as well as in another thread I linked to:

On a legitimate economic order:

I believe there are serious questions in regards to establishing a framework of legitimacy for a new private sector driven economy.

One can not simply assume that such will, ipso facto, have legitimacy. Iraq has been run as a quasi-socialist state for some 50-60 years, depending on how we want to slice the cake. Regardless of regime legitimacy, as in the FSU and former East Bloc states, ideas of property and the like will have been influenced by this experience. People expect certain things from the State, to wean them away from the more economically inappropriate requires a framework that many buy into.

Further, given the problems in the region, lack of access to oppurtunity is one of the key driving forces for discontent in the region, as well as a stultifiying force. Rentier behaviour rather than entreprenurial behaviour is what most economic systems in the region encourage, for a wide variety of reasons.

If we want a successful more or less democratic state, we need to create the socio-economic conditions for it. That means helping create the conditions in which opportunity is actually available – socially and economically. These are not to be assumed, I can assure you given both a close reading of the literature, and my direct personal experience.

It seems to me that to help the Iraqis survive the onslaught of change, a program of grants and finance to help them adjust and compete is absolutely necessary to help stave off (a) nationalist resentment of the flow of foreigners, Arab or otherwise, snapping up distressed assets (I may be one of them (b) help a civil society emerge out of the ashes. Of course, this requires in part an appropriate legal framework. but beyond that, it requires assistance to people who have never had these kinds of opps presented and will be in large part paralyzed by the shock of change.

I am personally involved in some planning efforts to raise something like a venture capital fund for Iraq (this is is looking at something about 2-3 years down the road, optimistically) which would be one avenue, but there needs to be some distributive function to help out on this, some non-market driven assistance to get people up to the level where they can compete.

Otherwise, and I have said it many times, we will see Egypt on the Euphrates.

Now I have elsewhere (here http://boards.straightdope.com/sdmb/showthread.php?threadid=177930 ) hypothesized that it will be necessary to set up some kind of social fund to help ensure that Iraqis do not become alienated from their own economy. This is a serious problem – I believe many Americans recall the anti-foreigner (largely anti-Japanese) backlash of the 1980s when there was a rising sensation (I think unfounded but…) of ‘Americans’ losing control of their economic assets.

Well, let us displace that to a country that in the lifetime of its elderly did in very real ways lose control of its assets – to colonial rule. Obviously if we place this in the political context emerging, as Tom has kindly supplied through a link to the WP, one which looks rather different than the starry eyed predictions made in the recent past.

I believe we see the outlines of the problems here:
(a) Establishing a legitimate long term political order, with the problem of severe conflict between short term and medium term interests in this matter.
(b) Establishing a legitimate economic order, with similar if perhaps less severe tensions.

Now, I hope to find the time to write something analytical.

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(PS: Please do excuse the title, it is again ironic )[/sub]

2

Well, we already seem to be busting some clerics we don’t like. Of course, it might be because they’re trying to set up their own government.

http://news.bbc.co.uk/1/hi/world/middle_east/2965005.stm

3

Question; which has the more rounded oxymoronic qualities;

‘Imposed democracy’ or ‘Islamic democracy’ – I’d take a vote but the fashion suggests that would be in the hands of others.

Anyway, isn’t it most truthful to say we’re, firstly, imposing capitalism (so the acquisition of Iraq by the empire makes logical sense) and, then, that the form of ‘democracy’ is rather subservient to that primary goal.

If one accepts that order of business, then the form of democracy permitted (by those acquiring) must firstly serve the (capitalist) empire, but in a way acceptable to the new democrats i.e. the full extent of ‘the arrangements’ are kept from them (the people).

Thus one assumes ‘the arrangements’ in Iraq will be in discreet contractual form and made with (for whatever reason, bribes, blackmail, etc) sycophantic Iraqi officials. Plus the empire troops will be kept at a reasonably discreet distance while they guard the contracts.

In this way both the people and the empire are satisfied.

Once that’s all achieved (a framework of capitalism with a pseudo-democracy) the empire has what it needs, fresh markets - the ongoing contracts, control of officials, preferential status for future capital projects, control of the funding thought the World Bank, oil priced in dollars plus new Islamic consumer-capitalists within its ever growing sphere of influence.

And all that oil …… Win! Win! win!

4

I see absolutely nothing oxymoronic about Islamic democracy. It all depends on the outline. Imposed democracy is perhaps another case.

Imposing capitalism.

Perhaps, but what would you do then? Return Iraq to the corrupt days of quasi-socialism?

Iraq needs a healthy, sustainable economic system. Some form of private sector oriented economic system with social democratic protections is about the only way to go, in my opinion.

Now if we impose say Amity Schlaes ninnnyhammered suggestions on IRaq, then I may agree.

WEll, abstracting away from the silly Empire language for the moment, although perhaps not entirely out of place, there is a problem there – that is what I have been warning of, a pseudo-democracy beholden to the Americans, an Egypt on the Euphrates.

In the long run no one in this manner gets what they wanted. Corruption will undermine the economy, growth will stagnate and we get another weak client state that undermines our image, breeds hatred of the West for imposing it, and generally is as unstable or more so than Sadaam.

5

Sorry to diverge from the main thrust of this thread, but my god that is a horribly depressing quote. No one thought about the aftermath? Who the hell is in charge back there? They’ve been planning this debacle for years, they have always presumed that the military phase would be quick (it was Pearle or Wolfowitz that said the regime would collapse at the first whiff of gunpowder), and they never thought about what came next!?

6

From the previous thread:

That would be my first thought, too, although an enforced holding period might be of some assistance. (I’m no economist, although I did play one for a fleeting moment in grad school, so I have no idea of how such an idea would be implemented, or how it would work logistically.) I can post some bibliographic items from a grad syllabus on post-socialist economies in transition, if anyone’s interested (and if I can find the darn thing).

Russian industrial privatization was a disaster for many reasons, including 1) ordinary individuals not fully understanding the value of their shares and giving them away for practically nothing; 2) ordinary individuals understanding the potential value of their shares if the economy shaped up, but feeling that a bird in the hand was better than the possibility of numerous birds in the bush; and 3) ordinary individuals understanding the potential value of their shares, but being so poor due to the economic situation and therefore desperate for a bit of cash that they were willing to sacrifice future gains, even if they were confident that such gains would come eventually. I don’t have stats handy at the moment, but for a large proportion of Russians, disposable income is really pretty much a foreign concept.

Add in the corruption factor (the Russian for privatization is privatizatsiya; in practice, it was sardonically called prikhvatizatsiya [grabbing] by ordinary folks), which meant that in general only the post-communist former Party elites and a few enterprising folks, many of whom had been prominent in the underground economy in the Soviet era, actually had enough inside knowledge, spare cash, and/or moxie to come out ahead, and you understand why many Russians still feel they were no better off for having received the vouchers.

I suppose in Iraq, at least there should be a somewhat more developed firsthand understanding of the workings of a capitalist economy. I don’t know how one could prevent or minimize the effects of the corruption factor, though. Ideas?

7

My NGO/historian friend just tipped me off that Bernard Lewis will be appearing on tonight’s edition of Charlie Rose:

http://www.charlierose.com/index.shtm

8

I had a question about how public opinion in the ME has evolved since the end of the war. Are people resigned to a long American presence in Iraq? What did they think about the threats made to Syria? What is the possibility of Islamic extremists slipping into Iraq to fight the Americans?

BTW about the Shia situation here is another story:
“A senior Shiite Muslim cleric said Thursday that the sect’s highest authority in Iraq (news - web sites) will refuse any contact with Americans and said they should leave the country and let Iraqis form an Islamic state led by someone untainted by foreign connections.”

http://story.news.yahoo.com/news?tmpl=story2&cid=540&e=11&u=/ap/20030424/ap_on_re_mi_ea/iraq_shiites

It was entirely predictable that destroying the Baath regime would create a vaccum and that Shia religous types would rush to fill in the vaccum and that is exactly what seems to be happening. It appears that all the different Shia factions are united in their opposition to the US presence so any US hopes of exploiting divisions are slim.
9

Well, that’s certainly not going to happen. I must admit, these certainly seem to be interesting people, of the kind who manage to say what they wish to be true, and then act as if it is.

You know. Marketers.

I see this often in some of the more… macho middle-eastern types I know. It tends to either work for them very well, or they run into metaphorical brick walls. It also makes them very annoying to work with.

10

Colls, what was the historic Iraqi mindset vis-a-vis private enterprise? Is this a trading culture historically? Traditional middle men? Implications that follow…

Really, what I’m asking is there a historical pre-disposition towards enterprise? In some ways looking a guidance from China versus Russia, and their very different experiences toward free markets.

11

I say Coll - I see Donald Rumsfeld has finally overstepped the mark in terms of dictating terms to the Iraqi calls for an Islamic state…

I believe the quote was (and I saw him say it but I paraphrase with caution) "If you’re suggesting some sort of Iranian model? Where a handful of clerics are running the show and making all the decisions? Well the bottom line is… that ain’t gonna happen…"

Now, feel free to wax lyrical as to how that quote is gonna reverberate around the traps… certainly, it seems to me that old Rummy has managed to redraw the battle lines in one fell swoop.

I’m really interested as to how this is going to play out now… it seems to me that the Iraqi Imams - those who have varying degrees of political aspiration - are really gonna have a field day with that quote. They’ll be able to accuse the USA of double standards - namely, I predict we’ll be hearing quotes like “The Americans say Iraq can have any form of government that we want - but only if the United States approves… this is not freedom… this is Iraq under the gun of the Great Satan blah blah blah blah” and out will come the street marches and all the flaming rhethoric etc.

That’s my prediction… is that how you see it panning out?

Also, what can the USA do now to win this battle of hearts and minds? I’ve been suggesting the US needs to get Iraqi State TV up and running a.s.a.p. to start fighting the good fight, public opinion wise - perhaps a quick Rupert Murdoch printing press wouldn’t go astray in terms of pumping out a broadsheet newspaper which at least offers a varying viewpoint? I only suggest Rupert because, whatever you say about the guy, regardless of all his FOX blandness etc, he undeniably has pure newspaper ink running through his veins. And he’s an Aussie… so it’s a bit of a lark… but my point stands though - namely, the Imams are really winning the manipulation battle at the moment.

Or are the Americans damned from the get-go now? Has old Rummy finally given the Iraqi Religious Right the ammo they need to pull out the heavy hitters of righteous indignation?

This is a really interesting power play at the moment, I must say.

By the way, the Australian Government is requesting that if any responsibilities are doled out our way in terms of post war re-construction, well we’re asking that we should be put in control of Iraq’s agriculture industries - seeing as we’d like to think we have a fair bit of panache in terms of being a major agricultural player. Is this getting any harsh press in the region, or if not, is it a pretty safe bet and sufficiently tactful that Australia will escape too much local rhetoric?

12

Required reading: http://www.tnr.com/doc.mhtml?pt=Yk%2BOXU1udCYAA92UJvYGLB%3D%3D

13

More: http://www.nytimes.com/2003/04/24/international/worldspecial/24IRAQ.html

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I can’t find a good english language article on tthe Shiite clerics. There’s four important factions, two of which are pro-theocracy. More later.

16

Col – This editorial in the Arab News takes Arab journalists and leaders to task for claiming that every problem is “all Israel’s fault.”

How significant is this article? Is it a widespread POV now in the Arab world? Does it represent a major shift in the opinion within the Arab community? Can we expect to see more focus on “peaceful coexistence, internal reflection and healthy, progressive thinking”?

17

Below quote from a new york times story reporting the explosition of a arms depot that exploded; you’ve probably heard about this by now.

At the end of the story they discuss efforts to return electicity to baghdad. There’s a part that confuses me, which i’ve bolded:

Seems that presently they don’t have enough money to pay people to do even the most essential stuff to get the city working again. How can this be?

18

Well, the national income was suspended during the war, as no oil was being shipped or sold. Beyond that, the government is gone,* so there is no one to move money around from one account to another to put it in a payroll account.

*Not only is Hussein and the Ba’ath party dead or fled, but a lot of buildings where the administrative paperwork and data management systems were kept are now smoldering rubble.

19

But why can’t the US just put up the money for the time being?

20

We will. However, look at the link and quote that Col included in the OP on this thread.