Iraq: Squeaky Societies Get the Oil Money

Mary Katharine Ham
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Posted: Jan 11, 2007 4:03 PM

Michael Barone has been talking for a while about equitable distribution of oil profits among Iraqi groups:

One such step the report mentions is "equitable distribution of oil revenues." An excellent point. Since April 2003, I have been urging the creation of an Iraqi oil trust, modeled on the Alaska Permanent Fund, which would distribute a portion of oil royalties annually in equal amounts to every man, woman and child in Iraq.

The Iraqi constitution clearly allows, indeed invites, the creation of such a fund. It would be difficult to implement -- the government would have to create a workable private banking sector. But it would give every Iraqi, of whatever ethnic group or sect, an ongoing interest in the success of the government -- and an incentive to stop the attacks on oil and other infrastructure.

It's a more realistic way to improve life in Iraq than counting on negotiations to change the regimes of Iran and Syria.

That was, of course, one of the benchmarks Bush mentioned in his speech last night.

Iraq the Model spoke about the possibility of such a plan in December, when it was being considered by the parliament. Read the whole thing, but I'll grab a section (emphasis mine):

If this plan comes to materialize I think it can reflect positively on the security situation to some extent. The economy is part of the problem and also part of the solution and the government should move forward with reforms that involve economy and infrastructure as well as, of course and above all, security.

I personally like the idea of distributing the money directly among the population because I believe the people are more capable of making good use of that money than the government and instead of having billions lost to corruption and mismanagement that money will be used to revive the market and reduce the government's control over the economy. Plus, it will give people the sense that they do have an actual and visible share of their country's riches.

The private sector in Iraq had witnessed giant leaps immediately after the fall of Saddam; that could be seen in the form of the thousands of private businesses that were established in the course of the past three years and that had a direct positive effect on the standards of living after long years of deprivation.

It's worth mentioning that between 1946 and the beginning of 2003 a total of 8374 businesses were registered while between April 2003 and the end of 2005 more than 20,000 have been registered. During last month alone 286 new businesses were added.
Such statistics seem quite extraordinary under the current security situation which sadly continues to overshadow and limits further improvement of this aspect of life in Iraq.

This has been talked about in the past plenty, but I hadn't seen either of those pieces until today.

H/t to Michael Barone himself, who has many thoughts on the President's speech that are, of course, worth reading:

What we're seeing is a version of the good cop, bad cop routine. Bush is the good cop to Maliki, promising him support but reminding him it's contingent on his own behavior. Durbin, representing the congressional leadership, is the bad cop, telling him he'd like to cut off support very soon and suggesting he may well do it later.