Wednesday, April 3, 2013

Review Of The American Reconstruction Of Iraq, An Interview With Former Deputy Special Inspector General for Iraq Reconstruction Ginger Cruz

Ginger Cruz is currently the CEO of Mantid International, and most recently completed several evaluation reports for the United Nations in Iraq. From 2004-2012 she was the deputy Inspector General for Iraq Reconstruction. That gave her great insight into the rebuilding of Iraq. The Special Inspector General’s office (SIGIR) just issued its final report, which makes it an apt time to review how the largest reconstruction effort in U.S. history went. 

1. The American attempt to rebuild Iraq went through several stages. The first was under Paul Bremer and the Coalition Provisional Authority (CPA). One of Bremer’s concerns was returning services to their postwar level. The CPA tended to use foreign companies and large infrastructure projects to achieve that goal. What were some of the shortcomings of using those types of businesses and projects?

The use of foreign companies to rebuild meant that most of the money was earned outside of Iraq, eaten up in overhead, security, and logistics costs. Fewer jobs for Iraqis were created that might be expected given the level of expenditure, and those that were distorted the local economy. One significant outcome was the fueling of corruption, both among U.S. and Iraqi contractors, as billions of dollars flooded the country with limited oversight. The Iraq effort brought into focus some of the basic unanswered questions about the benefits of international development, and the challenges of so-called “stabilization” efforts; principally the challenges of implementing development projects to achieve political and security outcomes in an unstable security environment. Volumes have now been written about the lessons, too numerous to list here. At the end of the day, lots of money, good intentions, and doing what you know is not enough.

2. A second drawback the CPA had was a lack of staff and capacity to manage and oversee all of the money and projects it was responsible for. Did the U.S. ever solve those two problems, and what were some of the consequences of those two issues?

Had the U.S. told managers on day one that the plan was a 10-year rebuilding program funded with $60 billion, things may have been very different. Instead, ad-hoc teams on short rotations without sufficient transition were presented with large amounts of short-term funds. This made it impossible to systemically plan for long-term outcomes. As a result, enormous amounts of waste occurred, intended outcomes were weak, and unintended outcomes abounded.

3. Another trend that seemed to start with the CPA, and continued on for the next several years was a lack of unity of effort. The United States Agency for International Development (USAID) and the military for example, seemed to have their own plans for Iraq, and the former was openly hostile to many of the CPA’s ideas. Why wasn’t the U.S. able to get all of its various agencies to work together?

U.S. agencies, by nature, have their own processes and cultures. The only thing tying them together is the President, who does not have the time to manage Iraq reconstruction, and all the other issues confronting his office. When the U.S. decided that international development was a priority in the 1960’s, it created USAID. When it decided to fly to the moon, it didn’t ask the Air Force to build a better plane, it created NASA. But when it decided to undertake a multi-billion dollar stabilization and reconstruction operation, it failed to assign ultimate responsibility and properly resource any one agency.

One great example of conflicted inputs and outcomes, whose effects we know little about, is the use of the military’s Commanders’ Emergency Response Program (CERP)-funded micro-grants and USAID’s micro-loan program, which frequently were implemented in the same space.  If you were an Iraqi, would you prefer the grant or the loan? What was required to get the grant and what impression did our ad hoc policy leave on Iraqis view of corruption and sustainable business practices?

4. One success of the CPA was to get Iraq’s oil industry up and running again, which is the country’s main source of revenue. That is also a source of controversy as many critics have claimed that the U.S. invaded to take over Iraq’s petroleum. Did SIGIR ever find any evidence that Bremer or Washington wanted to privatize the energy sector?

Iraq is strategically important to the U.S. because of its oil reserves, but that does not mean that the U.S. ever intended to take over Iraq’s petroleum. At the end of the day, that is not what America is about.

Iraq today is the number two producer of oil, filling the gap created by international sanctions against Iran. If not for Iraq, the Iran sanctions may have driven oil prices up to the point that it would have hurt the U.S. and global economy. In that sense, the efforts taken by the U.S. to support an Iraq that freely trades its oil have been successful in maintaining oil supply and price stability.

The U.S. is only one of scores of countries that are currently working in and benefitting from the oil sector in Iraq. The greatest beneficiary of course, is Iraq, which has a budget this year of $118 billion with billions more in surplus to finance the gradual rebuilding of their country.  It is also important to note that the lions share of the efforts to get the oil industry up and running again should be credited to the Iraqis.

5. The next phase of the reconstruction effort came when the CPA was closed down and Gen. George Casey and Ambassador John Negroponte took over. They both thought that security was the main priority in Iraq, because without that nothing else could be accomplished. Were they able to operationalize their new vision?

First the Negroponte/Casey vision resulted in approximately $5 billion of funds designated for reconstruction being reprogrammed for security purposes, including the training and equipping of Iraqi Security forces.  The legacy of this program is an Iraqi Security Force whose numbers now exceed 900,000.

Security was and continues to be one of the key hurdles preventing Iraq from succeeding.  The genesis of security problems is a case study in unintended consequences. Once Pandora’s box was opened, the triple threat of terrorism, ethno-sectarian violence, and criminality were unleashed. The unlimited number of variables that have to be considered when judging which tools were effective in reducing violence and strengthening security make it impossible to judge whether Casey and Negropontes vision was achieved, although the continued insecurity of Iraq would suggest that it was not. While a military force is able to claim some gains with intelligence and lethal force, the asymmetrical nature of the ethno-sectarian threat limits the effectiveness of governmental responses, including of negotiation, economic development, and governance to counter violence.

6. When Ambassador Zalmay Khalilzad came in he wanted a unified civilian-military effort, and brought his Provincial Reconstruction Teams from Afghanistan to Iraq. It seemed like he got caught up in political disputes back in Washington. What were some of the debates going on within the administration that held up reconstruction in Iraq?

There was never a clear consensus in the U.S. government, i.e. the Administration and Congress that it wanted to spend billions of dollars, and five to ten years reconstructing Iraq. There was no focal agency, no dedicated funding, no clear vision for the short-term, let alone medium or long-term. Instead, the Good Idea Fairy alighted on the shoulders of mostly well meaning and intelligent, soon-to-be-frustrated, folks who reacted to changing conditions on the ground, and reconstruction projects multiplied. Policy direction was too broad, “create a free and democratic Iraq,” easily said but nearly impossible to achieve. The effort was, at its core, what political scientists consider a “wicked problem”, or one that essentially morphs over time.

7. During the Surge did the U.S. finally get all of its different parts to work together or were there still some issues?

The Surge remains a controversial topic for those that study Iraq. While there were clearly actions taken that contributed to a reversal of the descent into civil war, it is hard to pinpoint the degree to which the Surge was responsible for the improved security situation, for at the same time, significant moves were taking place with the government and with the people in Iraq, the latter being the most critical element keeping the country together.

As for how the U.S. government entities pursued their lines of operation on the ground, State, USAID and Department of Defense being the biggest, it was generally more of the same. Camaraderie between individuals on the ground overcame stove-piped reporting lines back to Washington D.C. To the extent that leaders agreed to leverage each other’s work, there was improved operation, but the limitations cited above, lack of a fully resourced lead with overall authority and an informed long-term plan, persisted. There were clearly examples of how military-civilian teams cooperated on PRTs, but there were just as many examples of PRT’s that were never integrated in their purpose, including the expenditure of the respective funds.

8. It seemed like it took quite some time for the U.S. to realize that the Iraqis lacked the capacity to run and sustain all the projects they were being left with. Why didn’t the Americans address this issue better right from the beginning?

Iraq has capacity, and it has money, but the nature of that capacity, and its choice of where to spend its money were elements not factored into hasty decisions for how the U.S. was going to pursue its reconstruction program. For example, Iraqi engineers were well known for their uncanny ability to keep ancient equipment running, but western sanctions had isolated them from modern equipment and techniques. Thus, installing a multi-million dollar computerized water treatment system, for example, was simply not a good fit. Leapfrog development has a smaller likelihood of being sustained, a fact well known in the development world. With most of the reconstruction first tasked to the military, this lesson had to first be learned by the US officials with the funds.

9. SIGIR said that the main success of the Americans in Iraq was putting the security forces back together. Can you explain what the U.S. was able to accomplish with the military and police?

SIGIR also was critical of initial decisions to disband the army and police. However, recognizing that mistakes were made, the U.S. then spent over $25 billion to train, equip, and rebuild the Iraqi military and police. While there are still many years to go before their capability, especially in intelligence, reaches a sufficient level to stem the terrorism challenges they now face, most security functions are being carried out today by nearly one million Iraqi security forces. Significant credit goes to the U.S. military for the training and equipping of those forces.

10. Finally, what do you think the United States should take away from its experience in Iraq?

Every country in the world has its own way of operating.  From rule of law, to trade, to social interactions, each one has some kind of a system that has evolved over time. In some cases, the systems are largely informal, or embedded in community or even religious structures. In other cases, they can be highly bureaucratic or technical. When undertaking an effort to aid the re-building or development of another nation, one needs to understand first, the environment into which the aid is being provided. Programs should be appropriate, driven by need, as defined by the beneficiaries, and they must have a high probability of being sustainable.  Further, much more effort needs to go into evaluations of U.S. interventions to determine the actual outcomes and impacts of various programs in order to inform future efforts. If not, billions more taxpayer dollars stand to be wasted with little benefit to our international reputation.

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