Rebuilding Iraq, Bush style

Campus Times
April 4, 2003

cartoon by Christian A. Lopez

In what is supposed to be a humanitarian process, the Bush administration has turned the reconstruction of Iraq into a controversial and competitive issue.

The White House authorized the U.S. Agency for International Development, an independent federal agency that receives overall foreign policy guidance from the State Department, to choose the main firm to receive $900 million worth of projects to revive Iraq's economy.

USAID decided to solicit bids to rebuild Iraq in secret and by invitation only to large political donors.

The USAID contract contains the plans to construct Iraqi airports, schools, bridges, roads, hospitals and power plants.

USAID only asked seven companies to bid and did not put out contracts on the Internet, like it otherwise would to make it eligible for other companies to bid.

USAID's excuse for soliciting bids the way they did was to make the process move quicker and begin reconstruction as soon as the fighting in Iraq ends.

Companies that are bidding are California's Bechtel in San Francisco, Fluor in Aliso Viejo and Parsons in Pasadena, also the Washington Group. in Boise, Idaho. These companies are to oversee the construction process as well as to distribute and purchase food, medicine and textbooks.

Halliburton, the firm run by Vice President Dick Cheney before the 2000 election, declined to bid directly, but Kellog Brown and Root, Halliburton's subsidiary, was awarded a U.S. contract to put out oil well fires in Iraq.

All of these companies are experienced, but some are also political donors who made generous contributions to Bush's 2000 election campaign.

Andrew S. Natsios, administrator of USAID, said that in its 40-year history, the agency has never spent so much money in one country in one year. The Bush administration is expected to ask Congress $100 billion to pay for the war and also a $2 billion provision for reconstruction. The rebuilding of Iraq could take up to $10 billion a year over three years, according to the United Nations Development Program.

So for USAID to successfully reconstruct Iraq, it must include unilateral participation and not eliminate outside companies from bidding.

The stagnant global economy will bring in new business to corporations in reconstructing Iraq and for non-U.S. corporations to be shunned from the bidding; much of the work has already been singled out.

It is also extremely unfair for British contractors to be eliminated from the bidding, considering that their troops are serving alongside U.S. troops in Iraq. European contractors such as ABB Ltd. and Siemens AG were also not involved in the bidding.

These closed-door talks have raised concern in European and Russian officials. And how can it not?

Their companies have been sustaining Iraq's economy ­ that is, until now. Iraq has been capable of supporting its schools, hospitals, energy grids and telephone lines due to a United Nations program that has allowed Baghdad to sell oil for humanitarian goods.

The MOU trade, which has enabled this, is worth billions of dollars each year, and countries such as France, Germany, Russia and China have been greatly involved in marketing their wares, unlike the United States, which did not show much involvement with the program until recently.

Russia has been the biggest participant in the oil-for-food trade, with $1.3 billion in contracts in 2001. They were also promised $40 billion by the Iraqis as soon as UN sanctions were lifted.

So why would the United States government deny outside bidders? It is because it wants to guarantee their deals for corporations close to the White House, and they want to eliminate foreign competition from bidding for jobs that will eventually be worth tens of billions of dollars. Not to mention the other reason ­ the chance to win Iraqi public opinion by demonstrating the good faith of the American people.