Austin Bay

Petroleum is the resource that dominates discussion of Iraq's economy.

However, water and rich agricultural land make the country much more than a desert oil spigot.

Combine water and productive land, and the product is history -- the history of civilization. As Mesopotamia (the land between the Tigris and Euphrates rivers), Iraq spawned the Agricultural Revolution and served as the cradle of city-states, and hence historical civilization.

Several economists and economic development experts argue that land --specifically "land reform" -- is key to ending Iraq's complex civil conflict. Among them is Peter Schaefer. Schaefer served in Vietnam as an American military intelligence officer, then in the mid-1970s became deeply involved in economic development analysis and property right issues. A former adviser to Peruvian economist Hernando De Soto, Schaefer is now working on a business project that involves "commercial scale" property registration in the developing world.

Vietnam sparked Schaefer's interest in economic development. In an interview last week, Schaefer told me: "I couldn't get my mind around the fact that the Vietnamese people were so smart and industrious, and yet they were just so damn poor. The (destructive effects of the) war didn't answer that for me. Why would someone choose Mao over Jefferson?"

Schaefer concluded the Vietnamese communists pursued a calculated land reform policy, one that leveraged Vietnamese villagers' traditional recognition of property rights.

In the 1990s, Schafer noted, Peru turned the "land reform" tables on the communists. Property rights reform helped defeat Peru's "Maoist" Shining Path guerrilla movement.

In Schafer's view, property rights reform gives Iraqi Prime Minister Nouri al-Maliki's government a very powerful political weapon, one that has war-winning potential.

Schafer supplied some fascinating evidence. According to him, less than 5 percent of Iraq's cultivatable agricultural land is "freehold" (owned with clear title). Ninety-five percent of the cultivatable land in Iraq is therefore "dead" (illiquid) and cannot be used as security for a bank loan. "Iraqi farmers who lack clear title can't get (bank) loans," Schaefer said. That limits economic creativity, particularly in a population demonstrably successful at small business operations. Schafer believes that 95 percent of family homes in Iraq also lack clear, secure title.

"Prime Minister Maliki needs to go on television," Schaefer advised, "and say: 'Citizens of Iraq, 95 percent of the property in this country is not legally in your name. You don't have title to your own land or your own houses. We're going to change that right now.'"

Austin Bay

Austin Bay is the author of three novels. His third novel, The Wrong Side of Brightness, was published by Putnam/Jove in June 2003. He has also co-authored four non-fiction books, to include A Quick and Dirty Guide to War: Third Edition (with James Dunnigan, Morrow, 1996).
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