The recent "donors' conference" in Madrid, Spain, raised $13 billion in addition to the $20 billion provided by the United States for Iraqi reconstruction, much of which will come in loans. The good news about the conference is that it exceeded expectations, and it shows progress in the right direction.
The best news is, as The Wall Street Journal said, "It is over and now the far more important consideration of what to do with Iraq's debts can begin." What to do about Iraq's outstanding debt is key to establishing a capital-friendly environment in Iraq.
That's why Empower America, founded by Ted Forstmann and celebrating its 10th anniversary this week, has joined together with Peruvian economist Hernando de Soto and his Instituto Libertad y Democracia to create the 21st Century Committee. The committee is a bipartisan, private-sector endeavor inspired by the spirit and success of the 20th century Marshall Plan in Europe and Gen. Douglas MacArthur's efforts in Japan after World War II. The committee consists of internationally successful businessmen and women, renowned economists and policymakers who believe that a vibrant, private-sector movement is essential to assisting in the transition to free enterprise and democratic self-rule in Central Asia and the Middle East.
Unfortunately, the international aid agencies and interest groups organized as NGO's (nongovernmental organizations) have all too often made "profit" a dirty word. The 21st Century Committee intends to demonstrate that entrepreneurs and companies in search of profit who are willing to put private capital to work in Iraq creating jobs are the only way for the country to become free, democratic and prosperous. In a soon-to-be-released report, we put forth a blueprint for bringing President Bush's vision of a democratic, prosperous and free Iraq to fruition. We believe the report can provide a framework within which Iraqis can develop a truly representative democratic system in the shortest time frame possible and provide the institutions that will unleash what Maynard Keynes called the "animal spirits" of the Iraqi economy and the other nations in the region.
Part of the plan will include dealing with outstanding debts remaining from Saddam Hussein's odious regime. We also make the case for why it is essential for Iraq's oil industry to be privatized, not restored as a state-run enterprise. The report lays out a strategy for establishing the rule of law by using de Soto's approach to establishing property rights that was successful in Peru and is currently under way in Egypt. And we argue strenuously for giving Iraqi entrepreneurs and foreign companies the freedom and flexibility they need to generate a thriving market economy.
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