Monday, October 02, 2006

Iraq Is a Failed State; You Can't Balance That

Via, the New York Times publishes an op-ed by a couple of research staffers at the Brookings Institution. The op-ed includes a graphic that purports to give a "balanced" view of successes and failures in Iraq. Juan Cole takes strong exception to the "intellectual framework" that informs the chart. Prof. Cole first tells us that 80,000 Iraqis are listed in a government registry as "displaced persons":

Ministry official Hamdiyah Najaf warned that "the condition of these displaced persons is extremely bad." Some are living in tattered tents and lack the most basic needs of life. Others have been forced to live with relatives in distant cities. Still others are sleeping on the ground. She said that there was very little repatriation of the displaced, almost none in fact. (This allegation contradicts earlier Iraqi government statements on the matter).

What follows is not an attack on persons, or valued colleagues. It is an attack on an intellectual framework. And by attacking it I would like to get analysts to rethink the framework. So, with all due respect, these periodic Brookings charts on Iraq statistics in the NYT have been completely useless and largely misleading. The fact is that many of the statistics are phony. This latest one says that the unemployment rate in Iraq is 30 percent. I challenge that. I challenge Brookings to prove it. I say that in Kirkuk, Ninevah, Diyala, al-Anbar, Salahuddin, Babel and Baghdad provinces (nearly half the country), the whole concept of going to work is almost meaningless for many residents because of the horrible security conditions. And I doubt things are humming along in Basra or Maysan either. The recent reduction in the number of attacks on US troops is also a mirage, because the US military has just run fewer convoys off base and so been less exposed to roadside bombs. When they do run a convoy, it is as likely to be attacked as ever. Oil production in August briefly spiked, though it still was not at the level of 2.8 to 3 million barrels a day typical of pre-US Iraq (pace what the op-ed alleged on the basis of one month). But in September the production fell again to only 1.8 mn. barrels a day.

And they actually say that "the economy has shown some improvement." What?? Is there improved manufacturing productivity? Is Iraq producing more steel? Pharmaceuticals? Anything? Are retail sales up? No!. There is no improved ordinary economy. It is a mess, a hellhole. The only "improvement" in the Iraqi economy would be because of high petroleum prices. But because the oil industry is state owned and profits go straight to the government, this sector is disconnected from everyday livelihoods. There is no evidence that the oil income is getting out into the pockets of ordinary Iraqis. Moreover, there is every reason to believe that much of the petroleum income is being skimmed off by militias and tribes via smuggling, producing a collapse of security in Basra, Iraq's third-largest city. There is no mechanism for auditing where the oil money is going. Saying that increased petroleum prices are producing an improvement in the Iraqi economy is like saying that increased gambling receipts by the Sicilian Mafia are a sign of an improved economy.

All along the way, these Brookings charts have been fantastically optimistic given the actual situation on the ground, and the whole idea that a country where there is no government to speak of and no indigenous army to speak of and 60,000 people a year being tortured, butchered and tossed mutilated in the streets by fanatical paramilitaries connected to government parties--that such a country is generating reliable statistics on employment and the economy is just a non-starter. Why aren't people more suspicious of numbers like those given for "unemployment"? And I guarantee you that there has been no improvement in the Iraqi economy this year such as real Iraqis would notice it. In fact, the professional classes are fleeing the country and shopkeepers close up at 2 pm if they manage to open at all. There are over half a million economic refugees in Jordan, and God knows how many in Syria. Improvement in the economy, my eye.

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