[Marxism] privatization-mania destroys Iraq

["andypollack@xxxxxxxx" <andypollack@xxxxxxxx>]

"Bremer discussed the need to privatize government-run factories with such 
fervor that his voice cut through the din of the cargo hold."

http://nytimes.com/2004/06/29/opinion/29KRUG.html
--------

June 29, 2004
OP-ED COLUMNIST
Who Lost Iraq?
By PAUL KRUGMAN

The formal occupation of Iraq came to an ignominious end yesterday with a 
furtive ceremony, held two days early to foil insurgent attacks, and a swift 
airborne exit for the chief administrator. In reality, the occupation will 
continue under another name, most likely until a hostile Iraqi populace demands 
that we leave. But it's already worth asking why things went so wrong.

The Iraq venture may have been doomed from the start ? but we'll never know for 
sure because the Bush administration made such a mess of the occupation. Future 
historians will view it as a case study of how not to run a country.

Up to a point, the numbers in the Brookings Institution's invaluable Iraq Index 
tell the tale. Figures on the electricity supply and oil production show a 
pattern of fitful recovery and frequent reversals; figures on insurgent attacks 
and civilian casualties show a security situation that got progressively worse, 
not better; public opinion polls show an occupation that squandered the initial 
good will.

What the figures don't describe is the toxic mix of ideological obsession and 
cronyism that lie behind that dismal performance.

The insurgency took root during the occupation's first few months, when the 
Coalition Provisional Authority seemed oddly disengaged from the problems of 
postwar anarchy. But what was Paul Bremer III, the head of the C.P.A., focused 
on? According to a Washington Post reporter who shared a flight with him last 
June, "Bremer discussed the need to privatize government-run factories with 
such fervor that his voice cut through the din of the cargo hold."

Plans for privatization were eventually put on hold. But as he prepared to 
leave Iraq, Mr. Bremer listed reduced tax rates, reduced tariffs and the 
liberalization of foreign-investment laws as among his major accomplishments. 
Insurgents are blowing up pipelines and police stations, geysers of sewage are 
erupting from the streets, and the electricity is off most of the time ? but 
we've given Iraq the gift of supply-side economics.

If the occupiers often seemed oblivious to reality, one reason was that many 
jobs at the C.P.A. went to people whose qualifications seemed to lie mainly in 
their personal and political connections ? people like Simone Ledeen, whose 
father, Michael Ledeen, a prominent neoconservative, told a forum that "the 
level of casualties is secondary" because "we are a warlike people" and "we 
love war."

Still, given Mr. Bremer's economic focus, you might at least have expected his 
top aide for private-sector development to be an expert on privatization and 
liberalization in such countries as Russia or Argentina. But the job initially 
went to Thomas Foley, a Connecticut businessman and Republican fund-raiser with 
no obviously relevant expertise. In March, Michael Fleischer, a New Jersey 
businessman, took over. Yes, he's Ari Fleischer's brother. Mr. Fleischer told 
The Chicago Tribune that part of his job was educating Iraqi businessmen: "The 
only paradigm they know is cronyism. We are teaching them that there is an 
alternative system with built-in checks and built-in review."

Checks and review? Yesterday a leading British charity, Christian Aid, released 
a scathing report, "Fueling Suspicion," on the use of Iraqi oil revenue. It 
points out that the May 2003 U.N. resolution giving the C.P.A. the right to 
spend that revenue required the creation of an international oversight board, 
which would appoint an auditor to ensure that the funds were spent to benefit 
the Iraqi people.

Instead, the U.S. stalled, and the auditor didn't begin work until April 2004. 
Even then, according to an interim report, it faced "resistance from C.P.A. 
staff." And now, with the audit still unpublished, the C.P.A. has been 
dissolved.

Defenders of the administration will no doubt say that Christian Aid and other 
critics have no proof that the unaccounted-for billions were ill spent. But 
think of it this way: given the Arab world's suspicion that we came to steal 
Iraq's oil, the occupation authorities had every incentive to expedite an 
independent audit that would clear Halliburton and other U.S. corporations of 
charges that they were profiteering at Iraq's expense. Unless, that is, the 
charges are true.

Let's say the obvious. By making Iraq a playground for right-wing economic 
theorists, an employment agency for friends and family, and a source of 
lucrative contracts for corporate donors, the administration did terrorist 
recruiters a very big favor.



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