Analysis: U.S. Redirects Iraq Aid
Sept. 14, 2004 -- Virtually without fanfare, the Bush administration has reprogrammed some $3.5 billion in aid funds to Iraq in ways that mark a fundamental shift in its strategy in Iraq, and a recognition that much of the U.S. effort during the first year of occupation was a failure.
The administration today sent a proposal to Congress to reprogram $3.46 billion from Iraqi water, power and other reconstruction projects to short-term expenditures designed to provide better security, secure and boost oil exports, and provide immediate aid benefits of the kind that can support the elections scheduled for January 2005.
Out of this total, $1.804 billion — which had previously been allocated for longer term water, sewage and electricity projects — will go to rush efforts to train and equip Iraqi police and other security forces. Another $180 million will go to planning elections and helping local governments in ways that will help secure their areas.
Some $450 million will be reprogrammed to repair and expand Iraq's oil production; $380 million will go to rapid spending on economic and educational reforms; and $286 million will go to rush efforts to expand job training programs and compensate for unemployment.
Some $360 million will be set aside to cover the "budget cost" of forgiving 95 percent of Iraqi debt to the United States incurred during the Iraq War. Washington evidently plans to forgive 95 percent of Iraq's prewar debts to the United States, which total around $4 billion.
A Recognition of Overall Failure
Part of this reprogramming is a recognition of the fact that the U.S. aid effort to date has had individual successes, but has been a dismal overall failure.
The United States has still spent less than $1 billion of the $18.4 billion programmed for fiscal year 2004. Much of that has been wasted due to sabotage, attacks and bad planning; has been spent outside the country; or has been spent on foreign security forces.
If Congress does not object to the proposed changes, they will, however, do far more than simply shift money.
This reprogramming exercise is a recognition that Paul Bremer, the former U.S.-appointed administrator in Iraq, the Coalition Provisional Authority and the U.S. military got the first year of the coalition occupation in Iraq fundamentally wrong. It is a also a de facto recognition that the neoconservative goals set for restructuring Iraq can never be achieved.
The effort to rush money into the Iraqi military and security forces recognizes the United States failed to make a serious effort to training Iraqi military and security forces to fight insurgents in any strength during the year following the fall of Saddam Hussein.
It is a recognition that the Bush administration, the CPA and the military were wrong in assuming the insurgency would be defeated by the time the new Iraqi forces emerged.
The ‘Vietnamization’ of Military Operations in Iraq
As a result, the U.S. focus was on relatively limited and slow efforts that created a large manpower pool with very limited training and equipment.
The goal was slow improvements in border defense, a token regular force, and security forces than could not threaten the democracy the United States expected to see emerge in the summer of 2004.
The current reprogramming provides additional funds for a totally different security effort that really began to gather momentum in April, when Washington realized it could not defeat the insurgents without strong Iraqi forces.
It was after the surge in attacks in April that Gen. David Petreaus was given the mission to train and equip effective Iraqi forces. As a result, the Bush administration is now rushing in funds for the "Vietnamization" of military operations in Iraq.
The United States has shifted largely to holding actions and surgical strikes, while Iraqi forces are being created to take over most missions from the U.S. and British forces, and eventually replace them.
Forced to Focus on the Short Term
Similarly, most of rest of the money funds urgent short-term aid projects where almost all of the funds will go to winning political support from Iraqis by giving them money for the projects they want.
This reprogramming is a de facto recognition that Bremer's ambitious plans to restructure Iraq's entire economy have failed, and that the CPA and USAID efforts to plan the long-term structure of Iraq's economic development have foundered in the face of insurgent attacks, theft and looting, bad planning, the inability to structure effective contract operations, and Iraqi opposition to outside efforts to dictate Iraq's future.
The United States has effectively been forced into a focus on short-term aid, into restructuring most of the contracts it has already issued, and leaving much of the future in limbo.
At the same time, the reprogramming is only a start at letting the Iraqis manage their own economic future.
Limited Operations and Strikes
No one really knows, however, how the part of the $18.4 billion that is not being reprogrammed can and should be spent.
It is clear that outside contract efforts come under constant threat, and massive amounts of the money go to U.S. and non-Iraqi firms and never reach Iraq. It is equally clear that many — if not most — projects lack the planning and execution to be cost-effective or guarantee lasting value and impact.
The end result is a confused mess where the aid program has only had partial reforms. There is a mix of time-urgent aid and uncertain longer-term plans — some neocon remnants, some useful, and many ineffective.
More generally, the new U.S. approach essentially defers most key actions and military risks until after the U.S. elections in November, while it raises growing issues about the timing of its longer-term goals.
It essentially defers any decisive U.S. military action unless it is forced on the United States. Everything will consist of limited operations and strikes until the new Iraqi forces are "ready."
Ready by 2005?
The problem is, no one can agree on when the Iraqi forces will be ready and on exactly what they should be ready for.
The Bush administration talks about the goal that the Iraqi forces will take back hostile cities and areas for the Iraqi administration. The White House and National Security Council have implied they will be ready to do this by the time of the election, which they have said will still be in January.
Interim Iraqi Prime Minister Ayad Allawi also talks about the election still being on schedule, but says it may well have to occur with substantial areas still being "no-go" areas, and significant numbers of Iraqis not voting.
But some Iraqi and U.S. officials are privately considerably more cautious than the White House. They feel the Iraqi forces will only really come online in the strength required to take over large parts of the coalition mission at some point in the first quarter of 2005, and feel the election will have to be pushed back by some months.
Some U.S. officers also seriously question whether the Iraqi forces will ever be heavy enough to do without U.S. armored escorts and air support, and if enough Iraqi forces will really be ready until mid-2005.
Good News, Bad News
None of this implies that Washington "lost" Iraq, or that the revised U.S. strategy cannot work.
It does seem clear, however, that this reprogramming request effectively marks an end to many of the plans of the neocons, a recognition that the CPA and the U.S. military failed to create an effective strategy for peacemaking during the first year of the U.S. occupation, and a de facto recognition that everything now depends on the ability of the Iraq government to establish true legitimacy, and on the Iraqi army and security forces to take over much — if not most — of the fighting.
It is also clear that the White House is "spinning" the story to estimate far more rapid progress than currently seems likely, that the elections remain uncertain and a key target for a mix of insurgents that are anything but defeated. What's more, the United States still has no meaningful strategy for either the overall reprogramming of the $18.4 billion in existing aid funds or dealing with longer-term Iraqi requirements on the order of some $50 billion to $100 billion.
The good news is a quiet shift to pragmatism. The bad news is that this shift and change in strategy may be coming too late, and in too uncertain a fashion.