Wednesday, June 23, 2004

Ideological Purity and Its Discontents 

John Judis, subbing for Josh Marshall at Talking Points Memo:
Bremer arrived in Baghdad in May after the Pentagon fired General Jay Garner. According to Garner, the Pentagon objected to his plan to hold early elections before Iraq's economy had been privatized. Bremer's mandate was, above all, to privatize. In June, as Bremer returned to Baghdad aboard a U.S. military transport plane after speaking at an international economic conference, he discussed his plans for Iraq with Washington Post reporter Rajiv Chandrasekaran. According to Chandrasekaran, Bremer spoke of privatization "with such fervor that his voice cut through the din of the cargo hold." "We have to move forward quickly with this effort," he said . . . .

You might think that in the face of the continued insurgency, the absence of electrical power, and of elementary safety on city streets, Bremer would have seen these measures, in the words of the poet Blake, as "sand thrown up against the wind." But this month, as he was about to leave his post, Bremer told Chandrasekaran that "Iraq has been fundamentally changed for the better" by the occupation. He said that "among his biggest accomplishments ... were the lowering of Iraq's tax rate, the liberalization of foreign-investment laws and the reduction of import duties."

Is this daffy? Set aside for a moment the actual condition of the country. If Iraq's streets were safe and lighted, and its pipelines pumping oil to Western Europe, it would still be better off with the kind of managed economic approach that worked in East Asia rather than the kind of economics that Reagan recommended for post-Carter America. But Bremer's schemes weren't even relevant, let alone appropriate, to the country he was supposed to be administering. What does reducing tax rates do in a country that lacks income and profits and is entirely dependent on foreign aid to run its basic institutions? What good does it do to offer up businesses for sale when no foreign company would dream of investing capital in the current Iraq? The only businesses that have profited in Iraq are those like Haliburton that are funded by American taxpayers.

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