The Non-Rebuilding of Iraq

 The Washington Times reports on the rebuilding of Iraq:

Increased Iraqi oil revenues stemming from high prices and improved security are piling up in the Federal Reserve Bank of New York rather than being spent on needed reconstruction projects, a Washington Times study of Iraq's spending and revenue figures has shown….

Out of $10 billion budgeted for capital projects in 2007, only 4.4 percent had been spent by August, according to official Iraqi figures reported this month by the U.S. Government Accountability Office (GAO). The report cited unofficial figures saying about 24 percent had been spent.

Meanwhile, some $6 billion to $7 billion from last year's budget is "being rolled over" and invested in U.S. treasuries, said Yahia Said, director of Iraq Revenue Watch, part of the private watchdog group Revenue Watch Institute.

The good news, such as it is? Oil production is approaching pre-war levels, coming in around 2.5 million barrels a day and is likely to increase over the course of the year. I'm sure we will be reading stories for years to come about all sorts of flim-flammery, corruption, fuck-ups, and more coming out of Iraq (and U.S. entities associated with same).

Whole story here.

Comments

[Eric Dondero]

What a pretty obscure aspect of the Iraq War story to focus on. Hey Nick, your readers would appreciate more, stories on the Iraq War that matter, like some features on libertarian guys in uniform fighting in Iraq.

There's at least two Libertarian Party members serving in Iraq right now, one of them Neal Boyd is on the LP of Alaska Exec. Committee. More interesting and pertinent than this non-story.

[Nick]

Eric, since the Iraq War was about oil, don't you think it's relevant to cover what is happening with the oil and related revenues? I do, and I'm a regular reader. So, it's 1-1 if anyone is keeping score about what Reason readers want to hear about regarding Iraq.

I wonder what the final tally will be.

[Mister DNA]

I thought the Iraq war was about Weapons of Mass Destruction Removing Saddam from Power Liberating the Iraqi people fighting the terrorists over there so we don't have to fight them over here building schools for Iraqi children. Is it about oil this week?

[James Ard]

Iraqi oil revenues in NYC? That sounds good to me. Hell yea the war is for oil, and rightly so. Did anyone really ever believe otherwise?

[Reinmoose]

can we all go out and hold signs that say "No Blood for Oil" again? I at one point thought that this wasn't the case because, obviously, we weren't getting very much oil from them. But wow, I think I underestimated the incompetence of the administration.

[Abdul]

flim-flammery, corruption, fuck-ups follow the oil for the same reason bank robbers go to banks: that's where the money is. It would be more of a story if a large profitable industry didn't have flim-flammery, corruption, and fuck-ups.

[jackanapestarian]

The good news, such as it is? Oil production is approaching pre-war levels, coming in around 2.5 million barrels a day and is likely to increase over the course of the year.

That is indeed good news, and it nearly spoils Reason's relentless search for that cloud behind the silver lining. Does anyone remember when libertarianism was an optimistic movement?

[Blue]

US tresuries are fine for the short term, in these toubled times, but I'd advise the Iraqis to diversify.

I think it's the Norwegians who invest a majority of their oil earnings outside their country to decrease the amount of corruption and economic distortion. They still blow money on kinds of silly stuff.

[Lamar]

"building schools for Iraqi children. Is it about oil this week?"

I was under the impression that the plan was always to use oil money to pay for rebuilding. It wasn't the reason we went in [yeah right], but it was always the plan.

[P Brooks]

Meanwhile, some $6 billion to $7 billion from last year's budget is "being rolled over" and invested in U.S. treasuries deposited in the Cayman Islands.

[Jim Bob]

So, uh, Eric: billions of questionably located dollars shouldn't even be on the radar? I don't think it's too much of a stretch to say that our guys are sort of dying so that those billions can flow like the spice.

[joe]

2003-2007: Why aren't you telling us about the Good News From Iraq, like the rebuilt schools.

2008: What a pretty obscure aspect of the Iraq War story to focus on.

[shecky]

It's about time the war started paying for itself.

[LarryA]

IOW, government is doing just as good a job rebuilding Iraq as it did New Orleans.

[T]

Hey, maybe they can use some of those billions to buy food for starving Iraqis. We can even give it a catchy name, like... like...

Damn. I'm drawing a blank here. Anybody wanna help me out?

[Pro Libertate]

Haggis for oil?

[joe]

The pizza joints in my city are all about the oil-for-food deal. Big time.

[tarran]

Oil for food, joe, oil for food, not oil on food.

That's a different program. An anti-insurgent ono - kind of like agent orange...

[creech]

So oil revenues to Iraq are going to be about $80 billion per year? Where will it go? A one time skim-off of $6 billion would provide a $2 million @ stipend to the families of those U.S. troops killed "for Iraq" and perhaps another $2-3 billion per year could set up a nice annuity for those maimed.

[John]

It is hard to spend money with accountability. Think about how much waste and fraud go on in our government and we have a fully functional GAO, OMB, Inspector General and Justice Department. When you are doing development work you can pick your poison, you can spend a lot of money quick and not be able account for all of it, or you can account for all of it and not spend as much or as quickly. Pick your poison. Given a choice, I think they are better off having the money earning interst in the fed bank of New York then having it all stolen.

This is another example of how unhinged Reason is about the war. The news is basically that Iraq is getting rich off of oil, but of course Reason spins that as a bad thing.

[T]

John,

Iraq is getting rich off oil, but actual Iraqis are kind of screwed. Maybe that's the point?

[John]

"John,

Iraq is getting rich off oil, but actual Iraqis are kind of screwed. Maybe that's the point?"

Why are they screwed? The money is not going anywhere and they have a way to get at it through a democratic government. Was it better when Saddam was stealing it all to build palaces and bribe European politicians? I think they are being screwed a lot less than Saudis who see all of their oil money go to the Royal family to pay for gold toilets and custom 747s. At this point, you can only spend so much money effectively. It seems to me to be smarter to spend what money you can and save the rest rather than open the flood gates and let it all get stolen because you don't have a mature enough government to account for it.

[J sub D]

I'm sure we will be reading stories for years to come about all sorts of flim-flammery, corruption, fuck-ups, and more coming out of Iraq (and U.S. entities associated with same).

Nick, have you been using my crystal ball without permission?

[John]

"I'm sure we will be reading stories for years to come about all sorts of flim-flammery, corruption, fuck-ups, and more coming out of Iraq (and U.S. entities associated with same)."

Of course putting that money in the bank makes it a hell of a lot easier to account for. If they just spent it all, it would be a hell of a lot easier to steal and Reason would be on here bitching about how the money was all stolen rather than set aside.

[SugarFree]

So... the justification for the war is now "building a savings account for the Iraqi people."

Basically the war was a particularly long and bloody bar mitzvah.

[Aresen]

Meanwhile, some $6 billion to $7 billion from last year's budget is "being rolled over" and invested in U.S. treasuries

Considering the movement of the US dollar over the last 12 months, it sounds like their investment strategy is off to a bad start.

J sub D

Nick prefers to use his Ouija board fine intellect.

[John]

"So... the justification for the war is now "building a savings account for the Iraqi people."

No. But Reason would bitch if you hung them with a new rope. The oil money is being accounted for and invested rather than stolen like it was under Saddam, but Reason finds a way whine nonetheless. There are lots of legitimate bitches about the reconstruction of Iraq. This really isn't one of them, if anything it is a good news story. But Reason has long since lost its ability to think objectively about the subject.

[SugarFree]

Yes, John, it's the people against the war who can't look at things objectively.

Let me guess, in six months everything will turn right around and we'll all be eating crow, right?

[John]

"Yes, John, it's the people against the war who can't look at things objectively"

No, that is not what I said. Perhaps you missed the whole sentence about their being lots of legitimate criticism of the reconstruction and the war. Being anti-war is completely reasonable. It is when you stop thinking about criticism and accept everyone whole cloth rather than understanding that not every story is bad news and not every criticism is valid that you stop being objective. Reason has long passed that point. Not everyone who objects to the war is like that. I would not claim otherwise. But this is a bullshit criticism and anyone ought to realize that regardless of thier position on the war at large.

[T]

I know it's early, John, but you're just a hair off from a drink for all of us. You can do it!

I'm thinking, maybe, just maybe, individual Iraqis have some ideas about how they could improve their lives and communities with a bit of extra cash. So, instead of investing billions of dollars in financial instruments, the money could be invested in Iraq by giving those individual Iraqis some money. It's not like we've never seen a precedent for that, is there?

[John]

"I'm thinking, maybe, just maybe, individual Iraqis have some ideas about how they could improve their lives and communities with a bit of extra cash. So, instead of investing billions of dollars in financial instruments, the money could be invested in Iraq by giving those individual Iraqis some money. It's not like we've never seen a precedent for that, is there?"

I am thinking maybe just maybe they have their own government that they elected and we ought not to tell them how to run it. If Bush told them to give all the money away, you guys would be on here bitching and moaning about US imperialism. Either they have sovereignty or they don't. I don't see how it is an unreasonable decision by the Iraqi government to do this and it is their money. But you guys are so angry and crazy about this stuff you don't think straight. If it happens in Iraq it must be bad. There can be no other answer in your mind.

[SugarFree]

John,

This is another example of how unhinged Reason is about the war.

You made it about the war. The post was really only doubting that either government, US or Iraqi, could actually spend that money to the benefit of the Iraqi people without billions being wasted.

[Russ 2000]

The result is that orders go out from the ministers in Baghdad, but there is no structure or staff at the middle level to carry out the instructions.

"It's like they lost the manual for driving the government," said Mr. Said, who is working to put that blueprint back together. "They lost the landing instructions for landing the airplane."

Lucky bastards.

[joe]

John, doesn't the unbroken record of Reason turning out to be right, and you turning out ot be wrong, in describing what's happening in Iraq suggest anything to you?

For the last five years, whenever you've read something in Reason about Iraq that you don't like, you've accused them of being unhinged. And then, a few months later, you've been forced to admit that they were right.

How's that Arab Spring going, buddy?

If you want to argue against this or that particular point, have at it, but you are in absolutely no position to pose as the wise man here, or put down anybody else on the planet for not being able to look objectively at the Iraq War.

[Pro Libertate]

Before we enter into a full-fledged joe-John dispute on the effectiveness of the occupation, let me just comment that I don't think that's the issue. It's whether we should be there. If Iraq becomes a Western-style, liberal republic in five years, great, but is that worth the cost? That's the real issue to me. joe has staked out a position where he loses if that happens. John on the other hand, loses if we fail. I lose either way.

[T]

I am thinking maybe just maybe they have their own government that they elected and we ought not to tell them how to run it.

Maybe we ought not to, but we, through our government, sure the fuck are. We might as well be telling them to do something worthwhile.

[Ethan]

This is another example of how unhinged Reason is about the war. The news is basically that Iraq is getting rich off of oil, but of course Reason spins that as a bad thing.

Um, Iraq generally gets rich off of oil. It's an oil-rich country. The only reason Iraq wasn't getting rich off of oil in recent years was because we bombed the hell out of it, killed several hundred thousand of its citizens, and had no plan to restore order after our savagery.

Iraq got rich off of oil under Saddam. Was that "good news"? No, because the revenues benefited only the powerful. Like....now.

There are a number of things that are back on track in Iraq nowadays, and that's good, but they never should have been untracked in the first place. That's bad.

The invasion and occupation of Iraq was a major error (a cascade of errors really) that has set our goals in the region back 10-20 years (perhaps more). That some things are beginning to return to the way they were before we invaded (5 YEARS AGO!) is a sign that some small part of the tremendous damage we have caused there is being remedied. I think that even you can admit that a reasonable person can see this fact to be as frustrating as it is encouraging.

[TrickyVic]

John is right, it's a smart move for the Iraqis. They are saving their money while spending and wasting ours.