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Who Will Profit From War in Iraq?

Christopher Brauchli

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One of the things we don’t want to do is destroy the infrastructure in Iraq because in a few days we’re going to own that country.
Tom Brokaw, NBC News March 19, 2003

Although we have not yet completely prepared the site for reconstruction, we are nonetheless preparing for that event. Reconstruction was not, of course, the main purpose of the war. The buildings were perfectly OK before they were blown up. So were the victims of the bombing. They were both blown up to effect regime change. The people can’t be reconstructed but the buildings can. We should, therefore, focus not on the misery that is being inflicted but upon the bright side of the war. And that is its aftermath and the opportunities for American companies that the aftermath presents.

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Because of the bombing there is going to be the need for a massive amount of rebuilding, an undertaking that will very likely be considerably more than the $100 billion that has been estimated as the cost of the war. An article in The Wall Street Journal, published before the bombs started falling, disclosed that the United States had already begun putting work out for bids to help with the rebuilding. That is what is known as foresight and it is the kind of thinking you would expect from corporate moguls such as Dick Cheney. By letting contracts before there’s anything for the companies to work on, those companies can be ready to begin rebuilding as soon as we finish destroying.

Under normal circumstances (as was true in Afghanistan and Kosovo) rebuilding would be undertaken under the auspices of United Nations development agencies. The trouble with that is that when done through the United Nations, all the countries in the organization get to bid on the work. That violates the age-old precept that “to the victor go the spoils.” The U.N. is not the victor. George Bush will be the victor and hence he (and his cronies) should get the spoils. And that is how it is going to work.

According to The Wall Street Journal, more than $1.5 billion In Iraq work has been offered to private U.S. companies under the plan. Although Mr. Bush said in his news conference on March 16, 2003, that the U.N. would be invited to assist in rebuilding what he called “post-Saddam Iraq” his social director sent out invitations only to United States companies. That was not a gaffe by the social director. It was intentional.

According to one highly placed U.S. official, problems encountered in rebuilding Afghanistan demonstrate that a multilateral approach slows postwar assistance. “At least to start, we intend to handle the big jobs ourselves” he said. Another said the U.S. wants credit for the rebuilding, which makes sense since we and the British are getting the blame for the destruction.

The opportunity to bid was put out in secret under rules that permit U.S. agencies to avoid open and competitive bidding procedures when deemed necessary to meet emergency needs. The companies that are being permitted to bid include Kellogg Brown & Root, a subsidiary of Dick Cheney’s Haliburton Co., Bechtel Group, Inc. Parsons Corp., Louis Berger Group and Fluor Corp. (As an aside, and not wanting to suggest anything inappropriate, the Journal notes, as should I, that those companies made political contributions of more than $2.8 million between 1999 and 2002, more than two-thirds of which went to Republicans.)

European countries have criticized the administration for leaving them out. Bernard Kouchner, former U.N. special representative in Kosovo said: “It’s impossible ? impossible ? to reconstruct without Europe, not just in terms of money but to push the international community towards your position. You have to offer them a piece of cake.” Ellen Blount, spokeswoman for United States Agency for International Development, says the only plans for involving foreign corporations is as subcontractors to the American companies that win the bids. That will help remind the other countries of their subservient place in the world community, something which the administration regularly does.

Francis Cook, former American ambassador to Oman and a consultant to several Middle Eastern companies says: “They are already screaming in the Middle East ? you call us corrupt, look at you giving contracts to American companies and no one else.” What they don’t appreciate is the debt of gratitude Mr. Bush owes the companies that are being permitted to bid.

The U.S. is not discriminating only against countries that opposed the war. Britain is also being excluded. British companies met with government officials in London on March 16 but were told by a spokesman for the Department of Trade and Industry that they could be promised nothing. Derek Simpson, a British labor union leaders said British companies would readily compete for reconstructions contracts if given the chance. They will not be given the chance for the foreseeable future.

The work being given U.S. companies will be paid for largely by Iraq. Contrasting the needs in Iraq with those in Afghanistan, at the State Department Daily Briefing conducted on March 21, 2003, Richard Boucher said: “There’s oil revenue the Iraqis themselves have that they can spend on their own needs in rebuilding.” That is a real boon to the United States. Mr. Bush lets contracts to rebuild the things he has destroyed or damaged to companies that supported him and the companies are paid with oil revenues derived from Iraq, the country whose buildings and infrastructure have been destroyed or damaged. It is a win-win situation for everyone except the Iraqis and the rest of the world.


Published Saturday, March 29th, 2003 - 02:55pm GMT

Christopher Brauchli is a Boulder lawyer and and writes a weekly column for the Knight Ridder news service

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