Global Policy Forum

By T. Christian Miller*

$30 Billion Later, Iraq's Reconstruction is More Distant Than Ever, a Times Reporter Says.

More than three years after the United States kicked off the biggest nation-building effort since the Marshall Plan, Iraqi Prime Minister Nouri Maliki last month made this astonishing plea to Congress: "It is imperative that the reconstruction start now!" Americans can be forgiven for asking, "Huh?" After all, haven't taxpayers already spent more than $30 billion trying to turn Iraq into a thriving democracy? Wasn't Iraqi oil money supposed to be paying for the rebuilding by now? What happened? The answer is, precious little. Although the U.S. has already burned through more cash in Iraq than it did in Germany or Japan during the entire post-World War II recovery period, it has failed to spark peace or economic renewal.

Iraq still produces less oil than it did under Saddam Hussein, according to the most recent State Department figures. Electricity generation is hovering above prewar levels, but higher demand means that many Iraqis — including the entire population of Baghdad — are worse off than under Hussein. Scores of health clinics and hospitals are unfinished, their doors and windows walled up with concrete. Raw sewage continues to flow directly into the Tigris River. The U.S.-trained police force is riddled with death squads. And then, of course, there is the unrelenting daily violence unleashed by the same Sunnis and Shiites who were by now supposed to be happily employed in U.S.-funded work projects.

President Bush once boasted that the aim in Iraq was to build the "best" infrastructure in the region. Now, top U.S. officials claim that the goal is only to "jump-start" the economy. The president's vision of building a city on a hill has been scaled back to pouring a concrete slab.

The reasons for the failure are well known and maddeningly circular. First, too few troops meant that the U.S. military was unable to provide the security needed. The biggest difference between postwar Japan and Germany and postwar Iraq is the word "post." Despite Bush's assurance that "major combat" is over in Iraq, the war never really ended. The continuing violence, in turn, doomed the Pentagon's reconstruction strategy: contract out the work of rebuilding to large, mostly American multinationals. Iraq showed that corporations are not designed to operate in the middle of a war zone. Companies like Bechtel, Fluor and Parsons had to hire massive private security forces that drained up to a quarter of the rebuilding budget. Engineers spent weeks trapped in their Green Zone quarters, costing $4 million a day. Sabotage of oil pipelines cut production by a third, costing billions of dollars that could have otherwise helped pay for new schools and water treatment plants.

The decision to rely on the private sector to achieve U.S. policy goals also guaranteed a clash of interests that undermined the rebuilding. A country is interested in achieving a policy, a company in making a profit. The 82nd Airborne's tactics are different from Halliburton's. Told to jump, a soldier will ask, "How high?" A contractor asks, "How much will you pay me?" A contractor will use machinery to pick up trash cheaply; a postwar planner would prefer to hire as many locals as possible to do the job slowly by hand. Finally, nobody was paying attention. Although Bush, Defense Secretary Donald H. Rumsfeld and Secretary of State Condoleezza Rice were responsible for military and political developments in Iraq, the rebuilding ping-ponged between U.S. agencies under the leadership of career bureaucrats.

Mismanagement, waste and outright fraud wiped out whatever chances there were for the Iraqi nation-building experiment. The U.S.-led occupation government couldn't adequately account for almost $9 billion funneled to Iraqi ministries. And a convicted American felon was entrusted with $82 million, much of which went missing. The U.S. may have built a nuclear bomb in four years, but it has yet to make the toilets flush in Baghdad's slums. Now, the original funds are running out, and the only new money is for training and equipping the Iraqi armed forces. Maliki's pleas to Congress for more were met with polite applause and an empty wallet. With Congress frustrated and elections looming, the U.S. appears ready to largely abandon the project. That would be the worst mistake of all. The kicker to this sorry history is this: Maliki was right. We need to pour even more money into the rebuilding.

As of now, the U.S. is hoping that Europe and the Arab countries will step in to provide the additional $50 billion or so needed to complete the reconstruction. Right. Most of our allies have yet to pony up money they pledged in 2003. Stuart W. Bowen Jr., the Pentagon watchdog who has often played the role of Cassandra as the special inspector general for the reconstruction of Iraq, estimates that Iraq will need nearly $1 billion a year simply to maintain what the U.S. has built. Without that money, the U.S.-built water treatment and power plants, such as they are, will slowly crumble.

The retreat from rebuilding is happening just as it appears that the U.S. has figured out how to do it better. The Army Corps of Engineers has begun contracting directly with Iraqi firms, which so far have proved themselves able to get jobs done more cheaply and faster than American companies. And the State Department has begun launching, albeit slowly, reconstruction teams in each of Iraq's provinces in order to improve local contacts and place more decision-making in the hands of Iraqis. Neither of these developments guarantees that the rebuilding will occur without more waste, fraud and abuse. But not devoting more money to the task is a guarantee for failure.

Progress in rebuilding Iraq means protection for U.S. troops. Senior U.S. commanders need to recognize the military value of reconstruction. Many junior officers in Iraq learned by hard experience the value of bringing basic services to the battered Iraqi populace. Nicknamed SWEAT — for sewer, water, electricity and trash pickup — these relatively inexpensive projects were more effective than all the other billions spent. On a trip through Sadr City last year, I saw U.S. soldiers greeted with waves, not fear, after an intense SWEAT campaign. The Army already has civilian affairs teams that do heroic work. But they are undermanned. If the Pentagon is serious about rebuilding, it must create a standing unit of soldiers and officers skilled in such hearts-and-minds operations. Serving in such a unit must be seen as elite and career-building, the hardest job in the Army: winning the war without firing a shot.

After the initial U.S. rebuilding program in Europe stumbled, Allen W. Dulles led the charge for a new aid plan in 1948 by making a simple argument: "There is no price tag on chaos, or salvation." President Truman and Congress stepped back, adjusted and passed the Marshall Plan, an even larger, more farsighted response. It was not too late then. It is not too late now.

About the Author: T. Christian Miller is a Times staff writer and author of Blood Money: Wasted Billions, Lost Lives and Corporate Greed in Iraq, to be published this month.