Privatization of Iraq

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Privatization of Iraq

  • "Fri Aug 8, [2003] 2:17 PM ET WASHINGTON (AFP) - President George W. Bush has appointed one of his major political fundraisers, Thomas Foley, to run the Iraqi state business sector and draw up a sweeping privatization, Foley said.
"As the coalition's director of Iraq public sector development, Foley will effectively decide which of the roughly 200 state-owned companies, employing about half a million people, should survive or die.
"Foley, who expected to depart as early as Monday, is to report to the US governor of Iraq, L. Paul Bremer."[1]
  • "...anybody who thinks that such natural wealth translates into a fat and happy middle class is in for a crude awakening. Precious resources alone -- whether oil or gold or diamonds -- rarely raise nations from poverty to prosperity. Countries usually become poorer, more corrupt and more prone to coups, wars and tyranny than their less-endowed neighbors, studies show."[2]
  • "BAGHDAD, 23 Sep 2003 (IRIN) - US officials are privatising Kimadia, the country's formerly state-run pharmaceutical industry, a move that may spell disaster for patients dependent on various drugs, head of the Medecins Sans Frontiers (MSF) NGO mission in Iraq maintained." [3]
  • Kamil Mahdi, Privatisation won't make you popular. Resistance has forced a military rethink - but not an economic one, Guardian/UK, 26 November 2003: "From the outset, the US assumed that Iraq's public institutions were, at best, superfluous. There was little interest in rehabilitation and reform, let alone empowerment. Instead, key Iraqi establishments were subjected to the command of private US enterprises under cover of a war emergency. ... privatisation is being imposed by bombing, looting, freezing of assets, random sacking of staff and exposure to unfair competition. ... There has been no assessment of the social or economic impact of privatisation, and no alternatives are being considered."
  • Robert Steinback, Exporting capitalism a fool's errand, Miami Herald, 9 December 2003: "By simultaneously force-feeding democracy and free-market capitalism to Iraq, the Bush administration is reprising a strategy that has repeatedly met with disastrous results throughout the world. ... If the strategy doesn't fail in Iraq as well, it will be a miracle. ... Recent history suggests otherwise. The concurrent introduction of free-market capitalism and democracy typically generates powerful opposing forces that can plunge underdeveloped countries into calamitous turmoil..."
  • Ian Traynor, The Privatization of War. $30 Billion Goes to Private Military; Fears Over 'Hired Guns' Policy, Guardian/UK, December 10, 2003: "Private corporations have penetrated western warfare so deeply that they are now the second biggest contributor to coalition forces in Iraq after the Pentagon, a Guardian investigation has established. ... While the official coalition figures list the British as the second largest contingent with around 9,900 troops, they are narrowly outnumbered by the 10,000 private military contractors now on the ground. ... The investigation has also discovered that the proportion of contracted security personnel in the firing line is 10 times greater than during the first Gulf war. In 1991, for every private contractor, there were about 100 servicemen and women; now there are 10. ... The private sector is so firmly embedded in combat, occupation and peacekeeping duties that the phenomenon may have reached the point of no return: the US military would struggle to wage war without it. ... While reliable figures are difficult to come by and governmental accounting and monitoring of the contracts are notoriously shoddy, the US army estimates that of the $87bn (£50.2bn) earmarked this year for the broader Iraqi campaign, including central Asia and Afghanistan, one third of that, nearly $30bn, will be spent on contracts to private companies. ... It is a trend that has been growing worldwide since the end of the cold war, a booming business which entails replacing soldiers wherever possible with highly paid civilians and hired guns not subject to standard military disciplinary procedures."
Note: Recommend at some point the spin-off article privatization of war. Traynor's article provides good basis.
see Private Military Corporations
  • Nathan Newman blogs on 14 March 2004 about how full scale privatization cannot proceed while the U.S. is an occupying power; a condition which will terminate upon acceptance of a new Iraqi Constitution; which contains a provision [4] by which all existing laws established by the occupation "shall remain in effect unless and until rescinded or amended by the Iraqi Transitional Government in accordance with this Law"; and that said "Iraqi Transitional Government doesn't come into existence until new elections occur, which can be as late as December 2005-- a long period to be governed by Paul Bremer's recently enacted pro-corporate laws."
  • Paul Krugman,Privatization in Iraq is out of control NYT, May 5, 2004. "Much has been written about the damage done by foreign policy ideologues who ignored the realities of Iraq, imagining that they could use the country to prove the truth of their military and political doctrines. Less has been said about how dreams of making Iraq a showpiece for free trade, supply-side tax policy and privatization [...] undermined the chances for a successful transition to democracy. A number of people, including Jay Garner, the first U.S. administrator of Iraq, think that the Bush administration shunned early elections, which might have given legitimacy to a transitional government, so it could impose economic policies that no elected Iraqi government would have approved. Indeed, over the past year the Coalition Provisional Authority has slashed tariffs, flattened taxes and thrown Iraqi industry wide open to foreign investors - reinforcing the sense of many Iraqis that the United States came as occupiers, not liberators."

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