Doug Lorimer
The Washington Post reported on June 18 that it had obtained a copy of a cable sent to US Secretary of State Condoleezza Rice from the US embassy in Baghdad that paints "a starkly different portrait" from the White House's public up-beat assessments of the Iraq war.
Marked "sensitive", the cable was dated June 6 and was addressed to "SecState WashDC". Typed at the very bottom of the cable was "Khalilzad" — the surname of the US ambassador.
The Post reported that the cable outlined "the daily worsening conditions for those who live outside the heavily guarded international zone" (known as the "green zone").
The same day as the Post's report was printed, White House press secretary Tony Snow claimed on Fox News Sunday that "incremental progress" was being achieved in Iraq, specifically citing "electricity generation, what's going on with the sort of supplies and basics" as "metrics you can use to measure progress".
The June 6 cable reported that the US embassy's Iraqi employees "all confirm that by the last week of May, they were getting one hour of power [at home] for every six hours without. That was only four hours a day for the city ... One staff member reported that a friend lives in a building that houses a new minister; within 24 hours of his appointment, her building had city power 24 hours a day."
The cable also reported:
- Ordinary Baghdad residents' "personal safety depends on good relations with the 'neighborhood' governments, who barricade streets and ward off outsiders. The central government, our staff says, is not relevant" to the daily lives of most of the city's 6 million residents.
- Hostility to the US occupation is so strong among ordinary Iraqis that those employed at the embassy must conceal, even from their families, who they work for. "For at least six months, we have not been able to use any local staff members for translation at on-camera press events", the cable stated. "We cannot call employees in on weekends or holidays without blowing their 'cover'."
- Queues for petrol have grown so long that one embassy employee had to spend 12 hours in a line on his day off.
On June 12, the US Newhouse News Service reported from Baghdad that the price of petrol "has more than quadrupled in the past year", resulting in "a crippling double-whammy to families who use the pump to fuel their cars and feed ubiquitous portable generators during daily electrical blackouts".
The fuel price increases are primarily the result of a demand from the International Monetary Fund that Iraq scrap subsidies inherited from the Baath Party government that was toppled by the March 2003 US-led invasion. "US officials expect Iraq to make further cuts in subsidies that will generate more unpopular fuel price increases this year, and are also urging the new government to make a quick start on privatisation", Reuters reported in January.
US energy secretary Samuel Bodman told a June 14 energy efficiency forum at the US National Press Club in Washington that he plans to visit Iraq soon to press for a new law that will lay out how foreign corporations can invest in the country's oil industry. "They do need a law that will tell the private sector exactly how the Iraqis will permit the development of reserves — what the rules of the road will be", Bodman said.
Iraq has proven oil reserves of 115 billion barrels — the fourth largest in the world (after Saudi Arabia, Canada and Iran). The June 15 Bahrain-based Gulf Daily News reported: "Multinationals eyeing Iraq's giant and largely undeveloped oilfields are waiting until a new investment code with a legal and regulatory framework is in place before they venture in."
Writing in the June 5 Middle East Economic Survey, Tariq Shafiq, founding executive director of the state-owned Iraq National Oil Company (set up in 1964), noted that under the country's post-invasion constitution, adopted last December, the oil industry is required to "rely on the most modern techniques of market principles and investment promotion".
This provision, he argued, lays the basis for "Iraq's future oil riches to go to IOC [international oil company] sole operations, effectively denationalizing Iraq's oil and gas assets. This would take Iraq back to the concessionary era with all its drawbacks, including serious infringement of Iraq's sovereignty" and "its near total financial dependence then on IOCs".
Pointing out that the oilfield development cost per barrel in Iraq is around US$1, Shafiq argued that it is "illogical to leave such a highly profitable business solely to the IOCs ... As long as Iraq's economy remains dependent on oil income, it is absolutely necessary to maintain a national state-owned oil industry" so as to ensure "optimum flow of income to the treasury".
From Green Left Weekly, June 28, 2006.
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