Global Policy Forum

By Mary Curtius and Paul Richter

The Pentagon's $18.4-billion Iraq reconstruction plan puts too much emphasis on big-ticket construction projects and not enough on creating jobs for Iraqis, State Department officials who have taken control of the program have concluded.

U.S. Ambassador John D. Negroponte is reviewing the program and hopes to come up with new priorities next month, State Department officials said. The department will then have to seek approval from the House and Senate appropriations committees to shift funds.

The move to redirect resources is likely to further delay some of the rebuilding, which already has been hampered by sabotage, red tape and infighting. U.S. officials see the reconstruction effort as critical to stabilizing Iraq and fostering democracy there. Changing the program won't be easy, because the allocations were approved by Congress, which established categories for specific projects, a senior State Department official said. Department officials said they didn't yet know how much money they would ask to redistribute.

Under the U.S.-led Coalition Provisional Authority and the Pentagon, occupation authorities in Iraq made and executed most decisions about public works projects, the senior official said. Although only $458 million has been spent so far, billions of dollars have been earmarked for infrastructure projects.

The State Department is determined to pursue projects likely to create more local jobs and to find ways to more directly involve Iraqis in the planning. "With the military engineers, they go out and do it," the official said. "The truth is, in some cases that has turned out not to be very effective. We were in such a hurry that we didn't talk to the Iraqis as much as we should have."

Had the State Department designed the plan, "it probably would have looked a little different," the official said, speaking on condition of anonymity. "There would be a different balance between bricks and mortar and capacity-building and technical assistance and training…. There would have been more of a built-in consultative process with the Iraqis."

A former official of the CPA, which was dissolved after the June 28 hand-over of sovereignty to Iraq, defended the program as administered by that agency and the Pentagon. "We clearly made a lot of mistakes," said the former official, who also requested anonymity because of the sensitivity of the issue. The next "six or nine months" will be critical as the reconstruction effort accelerates and the Iraqi interim government seeks to build legitimacy, he said. "My fear is that State won't be nearly as effective as they think they will be," the former official said.

Shifting the emphasis too much toward the sort of democracy-building projects preferred by the State Department and its foreign aid arm, the U.S. Agency for International Development, could be a mistake while Iraqis still have no regular supplies of electricity and drinking water, he said. Because there was little overlap between CPA officials and the State Department officials who replaced them, time is being lost as State learns the ropes and decides what it wants to do, he said. "It is not like the CPA and the Pentagon had it all wrong," the former official said. "I'm a little skeptical that people who haven't been out there have a clue what the Iraqis want."

In a recent interview with The Times, Secretary of State Colin L. Powell acknowledged both the need to make changes and the constraints on the department as it seeks to redirect the effort. "It isn't just a great big fund that we can do anything we want with without recognizing what we told Congress and what congressional intent is," Powell said. Still, he said, "I'm sure that there is the opportunity to do a lot of reprogramming." Powell said he was particularly interested in addressing Iraqi concerns on job creation.

Even as it reviews the reconstruction effort, the State Department has notified contractors that they are expected to hire as many Iraqis as possible for their projects, and it has begun consulting Iraqis on which projects they think should be tackled first, the senior department official said. Still, progress is slow, the official said. "Our hands are tied to a degree already because of the way the legislation was written and because of the understandable desire and need not to start all over again and break momentum."

Congress, the official pointed out, is already frustrated by the slow pace of the effort, which was funded in November. "Last fall, this was urgent, urgent," said Rep. Jim Kolbe (R-Ariz.), chairman of the House subcommittee that handles Iraq reconstruction funding. "We had to have this money right away. Then we've just been incredibly slow in getting this money spent. The frustration a lot of us have is that the money is not getting spent quickly."

Kolbe said he and other members of the committee asked in April that the State Department begin reviewing the program with an eye toward revising it. But it refused as long as the Pentagon was in control. "They didn't want to engage in an interagency process with the Pentagon and the Office of Management and Budget," Kolbe said. "So they did not begin a review of the plan prior to June 30, when Negroponte showed up and said, 'It's our baby now.'"

His committee has not yet been notified that State wants to redirect funds, Kolbe said, but he predicted that such a request would be approved easily. There is a feeling on the committee, he said, "that at least you now have an agency, or agencies in State and USAID, that are used to doing this kind of thing. This is their bread and butter."

Ray Salvatore Jennings, director of the United States Institute of Peace's program in Iraq, said he agreed that the program should be revised, and that the State Department was better suited for the work. The Institute of Peace is a government-funded nonpartisan think tank. "The State Department professionals have experience in the region, or in reconstruction environments," Jennings said. "Right away, that's a plus." But he too worries about the consequences of further delays.

"For the amount of money spent and the amount of talent put in," U.S. efforts so far in Iraq rank no more than "a D, maybe a D-minus," said Jennings, who worked on postwar reconstruction efforts around the world for U.S. and international organizations before joining the institute. "The glass is about five-eighths full, and we can still pull it off, but the glass is leaking," Jennings said. "If we don't pay attention to how we do our work, that glass is going to leak faster than we can fill it up."

During the seven months he spent in Baghdad, Jennings said, he worked with U.S. and Iraqi officials. "One of the lessons we have all learned the hard way in doing this work in Iraq is that it is absolutely critical to approach this with humility," he said.

Separately, Bush administration officials said they would allow countries that were not part of the Iraq war coalition to compete for prime reconstruction contracts in upcoming bidding. In December, an order signed by Deputy Defense Secretary Paul D. Wolfowitz excluded countries that had not joined the U.S.-led coalition, including France and Germany, from bidding on such contracts.