Centre for Research on Globalisation
Centre de recherche sur la mondialisation

The Corporate Looting of Iraq

by Sara Flounders

Workers World News Service, 24 July 2003
www.globalresearch.ca 30 July 2003

The URL of this article is: http://globalresearch.ca/articles/FLO307B.html

Before the water was running in Baghdad, before the electricity was operating, or the phone system, or mass transit or even the hospitals, L. Paul Bremer III, the U.S. top administrator, declared Iraq "open for business."

The looting of Iraq by U.S. corporate raiders had begun. Pentagon bombers and tens of thousands of invading troops had smashed open the doors.

Some of the same giant U.S. corporations that had received multi-billion dollar contracts to participate in the destruction of Iraq were the first to receive no-bid contracts for reconstruction. Halliburton, MCI World/ Com, Bechtel--all insiders in the Bush administration--were at the front of the line for giant handouts.

The Bush administration and Corp orate America had a detailed plan for the reconstruction of Iraq long before Bush gave the order for the massive destruction and military occupation. The May 1 Wall Street Journal reported that the confidential plan prepared by U.S. Agency for International Develop-ment and the Treasury Depart ment was drafted in February--before the U.S. invasion and occupation.

The plan calls for mass privatization of Iraqi industry, liquidation of insolvent Iraqi industries and assessment of others for sale. It also proposes a year-long propaganda effort to persuade the Iraqi people that this is in their best interests.

Overseeing the restructuring of Iraq's financial system is Peter McPherson, a top Treasury Depart ment official who is now the head of the Iraq National Bank. The U.S. AID/ Treasury Department report echoes the recommendations of the Heritage Foundation. This powerful, neo-conservative think-tank calls for preparing state assets for privatization, including industries, utilities, transportation, ports, airports--and most importantly, the energy sector.

Ariel Cohen, a research fellow at the Heritage Foundation, wrote a June 17 UPI analysis entitled "Oil Privatiz ation--Key for Iraq." The international implications of restructuring Iraq are made clear. "Iraq's privatization of its oil sector, refining capacity and pipe line infrastructure, could serve as a model for the privatization by other OPEC members, thereby weakening the cartel's domination of the energy markets."

According to the Heritage Found ation, windfall oil revenue should be distributed to individuals. What the war was all about The restructuring of Iraq and re-conquest of the entire region is what the war was really all about. Corporate America is determined to lay hold of the fabulous oil resources and the developed infrastructure.

The reconstruction plan is so deadly, though, that it is fueling greater resistance. No wonder. Every sector in society, except a handful of collaborators, stands to lose.

Decisions are being made, multi-billion-dollar contracts signed and basic industries sold off or closed down by U.S. corporate executives without any Iraqi participation. These decisions will affect the future of Iraq for years to come. All this has been done before there is even an appointed government in place.

This secret corporate plan was very different than the excuses Bush, Cheney, Powell and Rumsfeld gave for the invasion, which are now being exposed as a massive lie and a forgery.

The Bush administration's deception is now being called into question, but only because growing Iraqi resistance is challenging the real plan of corporate looting and quick super-profits.

Iraqi acts of armed resistance now average 10 to 20 a day. GI deaths from attacks and accidents average one a day. The cost of occupation is rising in political and military terms. Secretary of Defense Donald Rumsfeld admitted that the military cost is now $1 billion a week.

The changes ahead that the occupiers are planning are every bit as brutal as the 13 years of U.S.-led economic sanctions. The resulting consequences for the average Iraqi would be even more devastating.

Shackled in the 'free market' Bremer, optimistically announcing plans to open Iraq to foreign investment, declared "Iraq will find that opening its borders to trade and investment will increase competitive pressure on its domestic firms and thereby raise productivity."

Bremer took the same message to the world's corporate and political elite gathered at the World Economic Forum meeting in Switzerland in late May.

The terms used are all too familiar: protecting property rights, lowering barriers, changing laws governing trade and commerce.

During the 13 years of sanctions, the U.S. shut Iraq off to any economic and commercial relations with the countries of the world, froze all Iraqi assets and barred all forms of trade. Iraq was prohibited from exporting or importing and was unable to modernize equipment or purchase spare parts. Bombing and military occupation followed this.

Now Iraqi industries are told they must compete in the "free market." Edmund L. Andrews described how a flood of imports threatens the survival of Iraqi businesses. "Iraq's cloistered industry suddenly faces the full fury of globalization and international competition," he wrote in a June 1 New York Times article entitled "After Years of Stagnation, Iraqi Industries Are Falling to a Wave of Imports." Andrews explained that "... since American forces seized Baghdad, Iraq has been transformed from one of the most isolated economies into a huge new free-trade zone.

"Iraqi manufacturers, which employed more than one-tenth of all workers before the war, are almost powerless to match the new competition. Their equipment is badly outdated. ... The free market shocks are even bigger for Iraq's state-owned industrial companies, which produce everything from packaged food to electrical equipment and employ more than 100,000 people."

Duty-free, cheap electronic products, packaged food and tons of other materials have flooded into Iraq. They have pushed Iraqi business that survived years of sanctions into overnight bankruptcy.

Privatizing of industry and public services is usually called by the innocuous term "structural adjustment." Through out the former Soviet Union, Eastern Europe and many Third World countries, the results for the overwhelming majority of the people have been a total disaster. These measures, dictated by the Inter national Monetary Fund and World Bank, led to years of massive, chronic unemployment. The people of Argentina, Mexico, Bolivia, Korea, Thailand and every other developing country have lost jobs and essential services while transnational corporations with capital to invest have picked up the windfalls.

U.S. Labor Against the War (USLAW) released a report in mid-June entitled "The Corporate Invasion of Iraq: Profiles of U.S. Corporations Awarded Contracts in U.S./British Occupied Iraq."

USLAW explained in a release: "Most of these corporations have been awarded no-bid contracts worth billions of dollars to rebuild and privatize Iraq, and bring its economy firmly under U.S. control. Their names read like a rogue's gallery of anti-union U.S. multinationals, including Halliburton (VP Cheney's former company), MCI (formerly MCI/WorldCom, notoriously anti-union and now charged with the largest fraud in history), and SSA (the leader of the attack on the ILWU during 2002 contract negotiations)." The contracts are enormous handouts worth billions.

USLAW says its report "exposes the labor, human rights, environmental and business records of these corporations--a sordid history of ... fraud, bankruptcy, overcharging, price-gouging, profiteering, wage-cheating, deception, corruption, health and safety violations, worker and community exploitation, human and labor rights abuses, union-busting, strike breaking, environmental contamination, ecological irresponsibility ..."

The best-laid plans The occupiers are committed to their plan. It calls for big layoffs of Iraqi workers, massive turnover of industries and services, cutbacks in all social programs. And it aims to end the numerous free services--from health care to schools--that the previous government had provided. Bremer also wants to cut the free food distributions to the entire population that kept 80 percent of the Iraqi population alive during years of sanctions. He considers them a wasteful subsidy.

Bremer's ban on employment for 30,000 members of the Baath Party impacts on many vitally necessary low-level civil servants. Bremer dissolved the Iraqi Army, putting 400,000 Iraqis out of work without pensions or retraining. He is engaged in a full-scale assault on the Iraqi state. This is calculated to shrink the public sector, including schools, hospitals and other essential social services, including sanitation and sewage and infrastructure needs of a modern country.

However, in order to have stability, the U.S. occupation must be able to provide the basic requirements of life. Electricity, potable water, communications, transportation, jobs, schools and health care are essential. But since taking over two and a half months ago, the U.S. has failed to provide even the bare minimum needed by the people while concentrating on suppressing their resistance and taking over their resources.

The Iraqi people, seething with rage against the occupation and re-colonization, are putting up increasingly fierce resistance. As it grows, U.S. congressional critics are beginning to complain that there is no plan on how to stabilize Iraq.

The plan to hijack the entire economy creates a contradiction that U.S. occupiers will not be able to solve. This unsolvable crisis, the criminal nature of the occupation and the growing resistance of the Iraqi people means that the only real solution will become increasingly clear to GIs on the front lines, their families and millions worldwide. Their voices will rise in a resounding demand to bring the troops home and end the occupation of Iraq.

 © Copyright Sara Flounders, Workers World 2003  For fair use only/ pour usage équitable seulement .