The U.S. occupation and its corporate cronies have ripped off Iraq’s oil wealth and ravaged the country’s infrastructure, several new reports show. Coalition Provisional Authority boss L. Paul Bremer slinked out of Iraq June 28 after turning nominal power over to an Iraqi interim government. But Iraq has been left to pick up the pieces after a year of inept and often corrupt U.S. rule, driven by the Bush administration’s aim of turning Iraq’s wealth over to U.S. corporate control. The new reports show the U.S. occupation has left Iraq worse off than before the war in many basic areas of life, and has tried to hamstring Iraqi efforts for real economic and political sovereignty.

The Open Society Institute’s Iraq Revenue Watch program charged that the CPA “launched a last-minute spending spree using Iraq’s oil money … committing billions of dollars to hastily conceived projects” just before the authority was due to close up shop. On May 15, the CPA’s spending arm, the Program Review Board, approved nearly $2 billion in expenditures for “a host of poorly planned projects” without consulting the relevant Iraqi ministries, the Iraq Revenue Watch report said. The report, titled “Iraqi Fire Sale,” criticizes the CPA’s “rush to commit Iraqi oil funds to projects already funded by the U.S. government, instead of waiting for the interim Iraqi government to make these budgetary decisions when it assumes power.”

Meanwhile, the British humanitarian group Christian Aid assailed “the U.S.-controlled coalition in Baghdad” for “handing over power … without having properly accounted for what it has done with some $20 billion of Iraq’s own money.”

In May 2003 the United Nations Security Council established the Development Fund for Iraq to collect Iraq’s oil revenues, repatriated funds previously held by Saddam Hussein, and transfers from the UN Oil-for-Food program, which ended in November 2003. This money was to be spent in the interests of the Iraqi people, and be independently audited.

Since its inception, the DFI has received $19.3 billion. As of June 9, $10.1 billion was left. The U.S. has spent half of the DFI money and used up almost all of approximately $2.7 billion in assets the U.S. confiscated from the Saddam Hussein regime, according to a June report by the General Accounting Office.

In fact, the U.S. occupation spent far more of Iraq’s money than its own, the GAO report shows. As of the end of April, the CPA signed contract commitments for only $8 billion – about one-third – of the $24 billion allocated by the U.S. Congress for Iraq’s reconstruction and humanitarian needs. But it signed contracts committing about $15.5 billion – more than two-thirds – of the $21 billion in available Iraqi funds.

Furthermore, the GAO said, “Transactions worth billions of dollars in Iraqi funds have not been independently reviewed or the results reported.”

Christian Aid noted, “It took until April 2004 to appoint an auditor – leaving only a matter of weeks to go through the books. Early reports of the audit indicate strong criticisms of the CPA’s handling of Iraq’s money. But the CPA is not going to be around to be held accountable.”

In October 2003 Christian Aid revealed that an “astonishing” $4 billion of Iraq’s oil revenues and other funds were unaccounted for.

Today, the group charges, “We still do not know exactly how Iraq’s money has been earned, which companies have won the contracts that it has been spent on, or whether this spending was in the interests of the Iraqi people.”

Iraqi Communist Party spokesperson Salam Ali said an independent auditing commission should be set up to go through all the accounts and contracts set up by the CPA, with authority to revoke or modify these as needed to serve the interests of the Iraqi people. But more important, “real economic control must be transferred to the Iraqi government,” Ali told the World. While achieving security is the top issue for the Iraqi people, he said, it is closely intertwined with the country’s economic situation. Noting the waste, inefficiency and corruption of the U.S. occupation, Ali said, “If a strong Iraqi government can utilize fully the oil revenues, we can do far better than what U.S. companies and the CPA have done so far.”

“Political initiative must be taken back from the Americans,” Ali said. “It’s about time.”
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Susan Webb
Susan Webb

Susan Webb is a retired co-editor of People's World. She has written on a range of topics both international - the Iraq war, World Social Forums in Brazil and India, the Israel-Palestinian conflict and controversy over the U.S. role in Okinawa - and domestic - including the meaning of socialism for Americans, attacks on Planned Parenthood, the U.S. as top weapons merchant, and more.