The Bid for Multi-Billion Dollar Reconstruction Contracts in Iraq

Deputy Secretary of Defense Paul Wolfowitz today announced that only those countries who supported the U.S. invasion of Iraq, sent troops or contributed significant sums of money, would be eligible to bid for the multi-billion dollar reconstruction contracts in Iraq.

From our perspective:

  • The reconstruction of Iraq should be for the benefit of Iraqis, not a reward for any corporations.
  • Reconstruction funds from the U.S. should be used to build up the devastated Iraqi economy – meaning that Iraqi firms and workers should be hired to rebuild the country, not U.S. or international firms.
  • If international companies are to be involved, they should be from countries like France and Germany where labor rights and protection of workers are taken seriously.
  • The claim that this practice rewards the U.S. because “we risked our lives” is nonsense. Young American men and women, mostly poor and mostly people of color, risk their lives; rich CEOs make the profits. Which of those CEOs risked his [sic] life?
  • When policy is made by ideologues who refuse to acknowledge political realities, it is not surprising that they will be caught up short by unexpected opinions of real people reflecting real opposition of real governments – meaning they may have to back down from Wolfowitz’s position.
  • The decision as to which countries to include/exclude is driven solely by politics, not by any claimed “national security” issues. Turkey, for instance, is on the acceptable list for bidding, despite its refusal to allow U.S. troops to open a northern front against Iraq from Turkish territory. Germany, for instance, is excluded, despite the fact that it allowed the Pentagon to use bases on German territory for transit and medical support, and sent significant numbers of troops to Kuwait in the run-up to the war. Chretien says Bush told him he would try to get Canada removed from the list; McClellan denied it later.
  • Relying on huge U.S. corporations for the major contracts insures that U.S. taxpayers’ money will be wasted on high overhead, cronyism, and potentially profiteering finances. Halliburton — $61 million overpayment fuel, $67 million mess halls. Oil for Food funds part of what Halliburton used for overpriced gasoline.
  • Kofi Annan called the decision “unfortunate.”
  • Inside the Pentagon, a weekly newsletter, “Deputy Defense Secretary Paul Wolfowitz last week directed a newly formed inspector general’s office in Iraq not to request sensitive information about Coalition Provisional Authority (CPA) activities related to intelligence or operational plans.”

From their perspective:

  • Continuing to isolate key countries that did not support the U.S. war will make James Baker’s efforts to arrange debt cancellation from Russia, France, Germany etc. much more difficult. Russian debt – $120 billion –U.S. needs debt to be cancelled.
  • These attacks on countries that refused to follow Washington over the cliff into Iraq will further isolate the U.S. from its allies, and will make it more difficult for the U.S. to get the UN Security Council to endorse the U.S. “transition” – read: exit – plan.
  • Excluding other countries’ corporations from the bidding process may violate “free trade” rules of the WTO and (especially for Canada), NAFTA.
  • Bush’s scorn for international law ramifications – “international law? I better call my lawyer; he didn’t bring that up to me” – will further antagonize other countries that take international law seriously.
  • Neo-con opposition – Kagan & Kristol — “dumb thing,” should be abandoned sooner rather than later. May indicate new split inside administration, might show likelihood of abandoning policy.

Phyllis Bennis is a fellow at the Institute for Policy Studies where she directs the New Internationalism project. Her books include Understanding the Palestinian-Israeli Conflict: A Primer and more recently Ending the Iraq War: A Primer.