Today, on our Australian “Face the Press” program, one very learned commentator described the current US Economy as having a Budget Deficit of 4% of GDP and “going south”.
You don’t have to be a rocket scientist to realise that the USA is soon going to find the task of funding Iraq in relative isolation an overwhelmingly expensive task.
And as of todays date, I still haven’t heard any overt posturings by the USA to show some humility and ask the key players in the UN (apart from Britain of course) to actually lend a hand.
It’s as though the US is getting these obscenely huge monthly credit card bills from Iraq each month, and the secretary at the Whitehouse just keeps filing them away, unopened, into a desk drawer - over there, in the corner.
[quote]
[ul][li]The press is…investing itself, it seems to me, in a sort of cynicism. It comes out better for them if they can predict hard times, bogging down, sniping, attrition.[] It’s quite extraordinary to see the way that American soldiers are welcomed.[] building schools, opening soccer stadiums, helping people connect to the Internet,[] there is a really intelligent political program as well as a very tough military one.[]one of the palaces, for example, that Saddam built, he’d stolen the land for from Mosul University.[/li]
Mosul is the site of a very famous old Iraqi university. The American forces were refurbishing the place. They were going to tear down some of the outer walls, give this palace to the university. They’d also connected the university to the Internet and to the Web. Helped people contact scholars on the outside world.[li]until not long ago, [lack of power and water] was more or less universally the case in Mosul… that’s the way Saddam used to punish people. He would turn off the lights on cities that didn’t like him.[]these [remaining Saddam loyalists] are the frightened gangsters who until recently were doing the torture chambers, and digging the mass graves and running the execution centers. These are people with nothing to lose, they are the absolute scum of the earth and they’re paid from the stolen money from the central bank of Baghdad…They pay unemployed kids and imported holy warriors $1,000 in cash if they will just take a pot shot with a throwaway gun or roll a grenade from behind. It’s much more like Mafia meets Jihad than any kind of a resistance.[]The other side, though, is that lots of people…who really want to sign up to join the hunt for Saddam and his people. And I actually think that the U.S. Army is probably not doing enough to recruit them.[/ul][/li][/quote]
So Hitchens sees a lot of positive things and claims that the press is too fixated on the negative. Is he right? I have no way to know.
>> I no longer can maintain neutrality on this, disaster looms.
The economic part is important but also the success of the military occupation and that is not going well either (as many had predicted). The occupation forces are unable to keep order and protect themselves. The more they try to keep order, the more vulnerable they are. The less they expose themselves to risk the more Iraq slides into anarchy and chaos and who is going to invest in a place like that?.
What ever became of the retired US Army General who was first appointed (prior to Bremer) to run the Interim Iraqi Authority?
Was his name Greene? I recall him hosting some of the very first initial think tank meetings within Iraq, and then Paul Bremer arrived to run the show and that original retired General, I haven’t heard from since.
Removed it was reported due to the sense he was not moving with enough force. Defenders have later cropped up to complain that he was not given the tools to move forcefully with. Whether it was his fault in terms of competence, his lack of bureacratic oomph or purely a sacrificial lamb to symbolically move ahead it is not clear.
Now we have early talk of bringing in James Baker, while expressing full confidence (as they did in Gardner) in Bremer.
Very obviously we’re seeing clumsy improv for policy. Of course, again a data point for december should he remain confused: (a) Lugar a loyal Repub has openly criticized reconstruction and (b) now the Admin is making noises about bringing in someone with oomph to “help” Bremer.
For those of us capable of non-partisan analysis, this has “problems” written all over it. I presume you will disregard, of course, the evidence and even the personal reporting on my part, to follow the talking points.
It seems Hitchens sees some reconstruction taking place, but is unaware as to what precisely is necessary and by whom it was mad necessary. The University of Basra was stripped bare, including theft of academic theses etc. through looters thanks to coalition troops simply standing and watching. Hitchens also obviously is not quite aware what efforts were already ongoing pre-war. I’d suggest familiarizing oneself with the work of ‘Architects for People in Need’, one of the last humanitarian organisations working in Iraq pre-war, refurbishing water-, wasterwater and electricity systems.
It wasn’t Saddam who forced them to stop working and take cover.
Hitchens seems to know of pre-war Iraq solely through rumors, and as such, I wonder what relevancy his statements have.
(quote)Secularism and working democracy are not synonyms and never have been. One may come without the other.(/quote)
Yes, but as I observe it: The tendency in the West, and especially in the USA, is to act and believe as if both are complementary.
By this completely overlooking the fact that Western ideas of complete secularism is in clear opposition with any form of state where Islam is the State Religion = in any state that wants to be called “Islamic” (we can argue here about the definition of that word but that is not the issue)
I don’t see it happen in Iraq that the majority of those trying to get a piece of leadershipscake are ready to embrace a form of secularism as the West sees it to be a “necessity for democracy”. They have seen the secularism of the Ba’ath regime at work and use this in their strive to a “back to the pure roots”.
As I said, everyone with some ingsight was predicting what we see happening now. It shall take more then a miracle to stabilize this mess without further bloodshed and chaos.
Maybe if the USA swallows its arrogant greed and the UN can take over = the USA and all others working together under the umbrella of the UN, some trust and respect can be obtained by the different parties in Iraq. And as much important: by the majority of the population no matter of which etnicy, tribe, language, religion… whatever. But I cant bring myself to any optimism.
(quote)As for the success or failure of Turkish secularism, well, it certainly is healthier than most any Arab secularism, and while the Turkish system is flawed, perhaps in the long turn fatally, the conservatism of rural areas has nothing to do with this per se, it is a typical sociological phenomena. The ability of the Turkish system to handle this fact in the long run is another matter.(/quote)
It isn’t a purely sociological phenomena.
Maybe you underestimate the influence of Islamic reasoning, which denegrates the efforts of Ataturk - especially the idea of secular nation building - to the level of blasphemy. The fact that because of this experiment the institution of the chaliphate came to an end, which meant the separation of the State from its purpouse to serve the Umma, is still a reason to reject the whole system. You don’t need to be a fanatic for this. The Turkish experiment, although admired in many aspects, isn’t the example other leaders will advocate to follow. It wasn’t at the time (the closest to it came Bourguiba) and it certainly is a risky buisines to propagate such radical breach with the state form as understood ( to come the closest to) “Islamic” now.
And I don’t know if you are familiar with Turkish communities in the West, but what we see there is the return to roots of Islamic tradition. It is partially profiling themselves as Muslims in a non Muslim society, which is done by every Muslim immigrant and which is always a mix of religion and tradition and culture that has become part of it.
But among the majority of Turkish immigrants it is more then just that and demonstrates clearly the failior of a secularisation forced upon the population. With all the often very negative aspects of radicalisation at that.
As for introductions of shari’a laws in constitution or juridical systems: You can’t expect this to be overruled just like that without having a mass revolt . In Morocco the mere rumour that a reform of family law was considered caused demonstrations, both for and against. Countries in the region can miss such opportunities for the radicals to recrute as hell.
When I said that the implementation of shari’a not necessarely implies a backlash for women, my thoughts were by this attempt to change it, which still causes trouble and which doesn’t progress as it should because of that.
As it shows, there are certainly many women who find their position as described by such laws satisfying enough to come on the streets in mass in order to protest change.
If the West starts talking about “democracy” in “Islamic nations”, curiously enough they never give these women a voice.
“Democracy” is for them equal with “accept our system or be despized”.
I’m sorry, but this ignorant arrogance is one of the causes why people see all this mingling in their countries as eruptions of Western post- colonial disease.
While praise is given to the personel in Iraq for doing much w/ little apparently there’re still:
1) a need for increased street- level presence in key conflictive areas;
2) a need to "quickly" hire private security to help stand up and supervise a “rapid expansion” of the Iraqi Facility Protection Service;
3) a need for short-term public works projects are needed on a “large scale” that comes with a reccomendation for a “massive” micro-credit program in all provinces;
4) a job that’s “too big to be handled exclusively by the central occupying authority and national Iraqi Governing Council”;
5) a “severely constrained” CPA human resources at the provincial and local levels that have led to some of the instances of implementation that is “lagging far behind needs and expectations in key areas”;
6) a need for CPA to “rapidly recruit” and field a much greater number of civilian experts to guide key governance, economic, social, justice;
7) a need for an “intense and effective communications and marketing campaign, not the status quo” because communication – between the CPA and the Iraqi people, and within the CPA itself – has been “insufficient so far”;
8) a need for a dramatic expansion and suprcharging of the Council for International Cooperation at the CPA because the scope of the challenges, the financial requirements, and rising anti-Americanism in parts of the country make necessary a new reconstruction coalition that is “significantly broader” than the coalition that successfully waged the war that involves various international actors (including those from countries and organizations that took no part in the original war coalition);
9) a need for “signifigant” outside monetary support over the short to medium term, meaning that the Pres and Congress will need to budget and fully fund reconstruction costs through 2004 as Senator Lugar has recently suggested and that “business as usual” is not an option for funding the operations in Iraq.
So, while the people who’re there are doing a bang-up job, they are crucially underfunded, understaffed and mis-oragnized in ways that must be immediately rectified if the succes is to be obtained. It appears that the whole operation is in jeopardy at the moment, and that it will be a failure if drmatic measures aren’t taken posthaste.
It seems to me that turning over the rebuilding of Iraq to the Pentagon was a mistake.
Why was the task taken from the State Dept? Anybody know the who and why of that one?
Let me be so bold as to point out the report agrees in gross with the assessments I have been passing along to date.
As for Aldebaran’s intervention, you want to debate issues off topic to reconstruction. I am not in the mood to be frank, however they are also off topic for this thread.
Collounsbury, I only replied on your replies.
And the Turkish example is a good case to study on because it demonstrates the failior to force Western rooted secularism onto a Muslim population.
Which is exactly what the USA dreamed about to do in Iraq.
Forgot:
Of course discussing this brings us off topic. But it wasn’t my intention to discuss it. I merely brought it up for touching an example of a long term effect of forced secularism based on Western priciples in that region.
That was from the New York Times 10 days ago. But, the London Telegraph today wrote
I don’t know how to reconcile 8 million barrels a month with over a million barrels a day. However, the drop in world oil prices seems to be evidence that the market is reacting positively to the growing Iraqi oil exports.
Also, contrast the spin of the Times “just a dribble” vs. the spin of the Telegraph “risen to more than a million barrels a day.”
Well, december, one can only hope that their success in the cause of getting Iraq’s oil industry up and running continues, and that they catch some lucky breaks.
Domestically, for the U.S., it should be noted that we are shouldering this reconstruction burden pretty much alone in the context of a debt that just since the start of this fiscal year has increased by just about 500 billion dollars.
That’s half a trillion; real money by anyone’s standards, I should think. And the fiscal year ain’t over yet.
Here’s the cite, do the math. Note that this amount is larger than what the entire debt was back in 1974. At the rate it’s getting piled on, we could threaten 1975. (click on the archives to see):
In current dollars, the GDP is at 10.7 trillion (1st quarter measurement), so assuming 500 billion for the deficit gets us to 4.7% of GDP for the current year (Boo Boo Foo, take note). The constant escalation in reconstruction costs, should the upwardly revised figures prove accurate, simply add insult to this injury. Of course we can’t really afford it, but we now have no choice in the matter anymore. Being cheap now will only make things infinitely worse later, as SimonX’s cite makes abundantly clear. Truly an awful situation.
Latest GDP figures here, for those interested:
Great post pantom. Now, it would seem that you have a pretty good handle on economics - certainly better than myself, seeing as how I’m a Systems Analyst by trade - and of course, Collounsbury is a professional in the field of economics and analysis etc - hence, my next question is this…
(1) If no other country offers to help the US shouldering this burden (for whatever posturing reasons), what will be the likely effect on the US economy, and by extension, the world economy?
(2) If no other country offers to help the US shouldering this burden, is there a threshold bleed point which would force US internal public opinion to in turn, force a US “pull out” out of Iraq - regardless of the outcomes? Or is that just totally not likely?
(3) How much would need to be contributed by the UN (which by proxy means other wealthy nations) to ease the USA’s sole burden on the Iraq Reconstruction? Ahhh… Coll I think you’ve answered that in the past actually - I believe your assessment was between 16-30 billion US dollars per annum for quite some time.
(4) Regardless of whether the USA approaches the UN Security Council for assistance, is there any chance that the primary notable members of the UN Security Council would ever seek to FORCE their assistance upon the USA, for the good of the world economy at large? Or are we condemned to seeing a state of cyclical “n’yah n’yah” at the highest levels? (Which I must confess I smell the slightest odious hint of at the moment).
In closing, has anyone noticed that the UN is presently amazingly quiet about the Iraq Reconstruction issue? I ask this because the USA does not rule the UN. Surely, the other permanent members of the Security Council are allowed the bring the matter up? Or, alternatively, is it merely that media coverage of the UN Security Council has driep up as of late?
Well, december your constant search for an itch to scratch re your obsession with finding “liberal” distortions can often be amusing, if it were not quite so illiterate.
Well, the reconciliation is that they are about two different goddamned things: one exports, the other gross production. Now if you put your mind to it I am certain you can grok to the startling fact that gross production does not and never equals exports. There is domestic consumption, off the top of my head Iraqi domestic requirements are about 1 mbpd of crude to meet domestic refined needs - i.e. at present Iraq has not been capable of exports except from prior reserve pools.
Well, one is a quantitative statement, the other is a judgement, based off of prior Iraqi capacity. If you kicked some critical thinking in gear you will quickly discern the difference - the value judgement is quite accurate actually given a total export capacity in the heydey, again as memory serves, of around 8 mbpd and even pre-war production of around 4 mbpd, I believe that being net domestic destined, but if not we look at 3 mbpd destined for the market, net out present production and you have almost nothing.
I would call that a disappointing motherfucking dribble relative to the present and pressing needs. Now, since december was an actuary and thus ostensibly familiar with numbers, I am sure he can do the math on this, versus the capital requirements cited in this very thread for the oil sector alone to meet renovation needs. An enormous amount of capital is need simply to meet running needs and continue repairs. Further to that, domestic sales are loss making, and given the social situation, petrol will continue to be “socially priced” for the foreseeable future, so domestic consumption is a net loss.
Now, I would appreciate people paying attention rather than running around willy nilly desperately looking for liberals to attack.
BTW, the oil prices fell with the deaths of Uday and Qusay, apparently the oil traders were struck with a bit of premature hope.
Depends on the degree to which the US funds the efforts. Trying to do it on the cheap is, in my opinion, penny wise, pound foolish.
In the short run the US can lay on a massive amount of debt. US economy is fundamentally the strongest single economic engine on the planet and while debt levels are disturbingly high in the private sector, the public sector can likely lay on more for a short term.
That would push up interest rates, and potentially send the economy into another recession- however the spending on Iraq would be pure pump priming, unlike the tax cuts today which appear to have gone as much to debt reduction in the private sector as not- and could have an offsetting effect, even if not US sourced.
But assuming the US takes on the full implied burden of occupation plus reconstruction for 5 years, let’s say that is $150-200 billion overall, assuming lower cost of occuption (4 billion a month for 5 years is 240, that’s pain.), you say bye bye to tax cuts.
I don’t know myself.
This is ultimately a political question, and sadly one that everyone seems to be dodging.
Look at december, he’s following the Bush Talking Points to the letter, trying to denigrate reports that show Reconstruction is going badly, questioning how much is needed, etc.
The minimization is politically sensible in short term sense for the elections in November 04, but disastrous for longer term interests.
Very clearly Reconstruction is badly stumbling and leading the US closer and closer to disaster.
However, all people can seem to talk about is American soldiers dying.
American soldiers dying is trivial, expected. What is important is that they die for a good reason, not while an Administration muddles along not knowing what it’s doing.
See above. Recall I was addressing a narrow range of reconstruction costs.
Let’s call overall cost for a 5 year time span at 300 billion USD. 60 a year.
If the US gets half of that, it’s a bloody miracle.
Or it is done on the cheap and it fails.
Why stick one’s nose in? If there are real negotiations ongoing, they will be in private, better for all around.
UN is present in Iraq and as far as I can tell the on the ground people get along well with CPA-I and USM.
However the Bush Administraiton has this irrational dislike, ideological aversion to the UN people and seem to freeze them out when they stick their noses in. Unhealthy.
Further to the issue of oil exports, from the New York Times
As we can see, a dribble of oil for export (often promised as well in the past, but yet to appear).
The article further notes after some discussion of OPEC posture:
Again, context. Always helpful to think critically and for context.
The article adds]
…… it is still hard to get a clear sense of how the Iraqi oil industry might progress, largely because of persistent looting and sabotage, industry analysts and Iraqi oil officials say. Shamkhi al-Faraj, head of the oil ministry’s economics department, estimated today that production capacity is 1.3 million to 1.5 million barrels a day, about 500,000 barrels more than a month ago.
[/quote]
Looks like my memory estimate of how much needs to go to domestic consumption and refining was about right then. Further data and observations in the article.
Thanks for the New York Times cite, Collounsbury. I repeat my contention that they are using negative spin, while the Telegraph is resorting to positive spin. Of course, the Times also has a lot of useful information.
Compare the Times’s headline with the first sentence in the article:
Headline: OPEC Unfazed by Prospects for Renewed Flow of Iraqi Oil
First Sentence: After several false starts, Iraq seems poised to resume a steady flow of oil exports starting in August
The headline is negative: It suggests that OPEC isn’t impressed with the renewed flow of Iraqi oil. The first sentence is mostly positive, except for the first four words, which aren’t news anyhow. In fact, the only news in the first sentence is Iraq seems poised to resume a steady flow of oil exports starting in August Imagine how the article would have looked if that had been the headline.
I question this sentence:
IANAOA, but I had understood that oil is a world market and the pricing reflects an expectation of future supply and demand. Under those circumstances, I don’t see why the timing of Iraqi oil reaching the United States will prevent a price drop.
Furthermore, if the Times’s point is correct, then it ought to follow that the Iraqi exports to the US will prevent an increase in oil prices this fall. Were the Telegraph writing this article, they might have focused on this positive point.
Also, ISTM that if Iraq is actually able to export 20 million barrels a month only half a year after the war ended (and not even fully ended), that might be considered pretty darn good. I’ll bet Germany wasn’t exporting substantial amounts of stuff six months after their capitulation. I bet it took years or decades for that to happen.
One might also question the sentence
My view of OPEC is that they are greedy. They will raise prices if they can. That suggests to me the possibility that doing nothing signals OPEC’s skepticism over whether they could make a price hike stick. That is, the threat of possible larger Iraqi oil exports is restraining their price increase.
BTW you can see the price of oil here. During the 12 months shown, it has ranged from $25 to $40. Based on this period, $30 isn’t “relatively high”. It’s roughly in the middle.
