Iraq: June 6, 2005


Meanwhile, the biggest obstacle to economic revival is not terrorism, but corruption. For example, over a third of Iraqs potential oil revenue is lost to corruption and theft. Thieves tap right into pipelines, put the oil on barges and float it away to neighboring countries, where unscrupulous brokers buy the hot oil at a discount. If the oil thieves encounter any of the security troops guarding the oil facilities, they bribe them. This is fine for the security guards, whose main job is to prevent terrorists from blowing things up, not stealing some oil. Another popular scam is to take advantage of the subsidized fuel inside the country. You can buy gasoline for less than ten cents a gallon. It costs much more than that in neighboring countries. Thats why there are always fuel shortages in Iraq. The gas is illegally bought up and exported. Stop this illegal trade, and you stop the fuel shortages. But too many Iraqis are too accustomed to taking a bribe. It will require a massive effort to stop the corrupt practices.

Many of Saddams old bureaucrats are back on the job, and for many of them, the main job is collecting bribes for doing their work. Otherwise, the bureaucrats are endlessly clever in dreaming up obstacles to getting anything done. The corrupt officials work in cooperation with criminal gangs, who act as enforcers, and protectors. But its so dangerous in Iraq, what with all the kidnappings, and angry citizens out to kill corrupt bureaucrats, that many of these officials operate from offices in neighboring Jordan or Iran. 

Iraq may be free of Saddam, but it is not yet free of the corrupt practices that allow someone like Saddam to take power, and keep it. While much is made of the terror Saddam used to keep Iraqis in line, we forget that he often used corruption, and the willingness of too many Iraqis to take the money and look the other way. The corruption has gotten so bad, especially the oil thefts, that the government is planning on firing several hundred thousand government workers. The money simply isn't there to pay them. The money, instead, is in the pockets of local criminals, or foreign bank accounts belonging to corrupt officials. Until Iraq can confront and conquer this enemy, they will not be able to enjoy the benefits of their oil wealth.

Despite the security and corruption problems, $5.5 billion has been spent on 3,200 reconstruction projects. These include work in the areas of Buildings, Health, and Education; Oil, Security and Justice; Electricity; Transportation and Communications; and Public Works and Water. Actually, only 2,389 of these projects has begun, with 1,174 completed and 1,215 still underway.



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