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'Vicious circle' taking heavy toll on Iraq

The blood of Fallujah, the thunder of Baghdad and the daily struggles of life have been distilled in columns of numbers and pages of dry prose. The experts have taken a hard look at Iraq, and they don't like what they see.

Recent in-depth studies — by official auditors and unofficial watchdogs, by economists and lawyers, by pollsters, political scientists and ex-Pentagon aides — find a few good economic signs and some cause for hope in January's planned elections. Even more, however, they find dashed expectations and rising fears, missed deadlines, mismanaged money and grand schemes lost in the smoke of car bombs and airstrikes.

With Iraq so unstable, "there are questions about what options and contingency plans are being developed to address these ongoing and future challenges," the U.S. Government Accountability Office (GAO) observes in a report to Congress.

Anthony H. Cordesman is more blunt. In many ways the U.S. occupation has been "a dismal failure," this veteran national security analyst says.

His colleagues at Washington's Center for Strategic and International Studies (CSIS) — in a separate 102-page analysis — note that "failure" and "success" are sensitive words as the U.S. presidential election nears. Nonetheless, they conclude, Iraq "will not be a 'success' for a long time."

The Associated Press reviewed a dozen such status reports against the backdrop of nonstop violence in Baghdad and sharpening rhetoric in Washington. The studies were conducted by U.S. government agencies and private international and U.S. research organizations, in some cases drawn from months of work and hundreds of interviews inside Iraq.

Again and again, their focus falls on what the authoritative International Crisis Group calls Iraq's "vicious circle."

"Lack of security leads to lack of reconstruction, which leads to lack of jobs, which leads back to lack of security," the European-based ICG finds.

Perhaps 60 percent of Iraq doesn't have work. With no jobs, more Iraqis turn to armed resistance, out of resentment of the occupiers and sometimes for money. Insurgents will pay a man up to $100 to attack a U.S. patrol, the CSIS says.

Security has spiraled downward since the U.S.-British invasion of March 2003. Iraqis see and hear it around them — in the car bombings, kidnappings, highway banditry and in the unrelenting mortar, rocket and roadside bomb attacks on the U.S. military. From a handful a day in mid-2003, those anti-U.S. assaults have exploded — to more than 70 on average every day last month.

The GAO report, "Rebuilding Iraq," describes what happened:

"The insurgents' targets expanded. . . . The group of insurgents grew. . . . The areas of instability expanded" — from Fallujah and the Iraqi heartland to Mosul in the north and to Najaf and Basra in the south.

Along the way, the total of U.S. military dead rose to above 1,060 and of wounded above 7,100. Last month, American deaths averaged three a day. More and more, Iraq's U.S.-supported interim government is also a target. An estimated 750 Iraqi policemen have been killed.

Iraqi civilians have suffered the most. Washington's Brookings Institution notes that unofficial estimates range from 13,000 to 30,000 civilians killed by acts of war since the invasion, by both U.S. coalition forces and anti-U.S. fighters and terrorists. No reliable count exists for insurgents killed.

The studies, issued between June and September, repeatedly suggest that two steps taken by the Bush administration last year fed the uprising: the disbanding of Iraq's 400,000-man military, and the stripping of government and other jobs from 30,000 members of the old regime's Baath Party.

"Abruptly terminating the livelihoods of these men created a vast pool of humiliated, antagonized and politicized men," says Faleh A. Jabar of the U.S. Institute of Peace. "Serious policy blunders," concludes Carl Conetta of Boston's Project on Defense Alternatives.

As the guerrilla war intensified, the U.S. leadership reached a turning point last April, canceling the planned pullout of some U.S. troops, deciding to keep a force of 138,000 in Iraq until at least 2006. "How many more U.S. or other multinational force troops would be needed if the security situation were to deteriorate further?" the GAO asks.

That deterioration did more than kill people. It also paralyzed much of the U.S. effort to rebuild a society crippled by wars and U.N. sanctions.

"We can't even get out of the Green Zone," one reconstruction official lamented to ICG interviewers, referring to the bunkered Baghdad enclave where the Americans are headquartered.

Even in its makeshift Green Zone offices, the U.S. occupation had problems, Washington auditors found.

The occupation administration, which evolved into a U.S. Embassy this June, usually had only two-thirds of the staff it needed, the GAO reports. And many of those were unqualified.

Outside auditors eventually found, for example, that the Americans operated one $600 million fund, of Iraq's own money, with poor controls and accountability. The occupation's

inspector general determined that 67 percent of one group of purchase contracts had incomplete or missing documentation.

It was "a picture of disorder and negligence," says Iraq Revenue Watch, an unofficial U.S. monitoring group. The inspector general says the mismanagement was "not surprising," in view of the "daunting challenges."

From the start, amid postwar looting and arson, one of the most daunting was restoring power, water and sanitation. The Americans' failure to deliver decent living conditions damaged their standing with the Iraqi people. Recent data "suggest a rather severe backward trend" in those areas, the CSIS team reports.

It took months for the electricity system to regain its prewar generating capacity of 4,500 megawatts. Iraq is still 1,500 megawatts short of the target of 6,000 set for last July 1 — and far short, the GAO notes, of the 7,000-8,000 megawatts Iraq needs.

As a result, much of the country goes for hours each day without power.

This "raises concerns about the ability of the coalition to support power-dependent infrastructure, improve Iraq's economy and promote stability in Iraq," the U.S. auditors say.

For ordinary Iraqis, the concerns turn real at the water tap.

The power shortage means Iraq's water treatment plants still don't operate at prewar levels, the ICG reports. Its sewage-treatment plants are no better, the CSIS says, dumping untreated waste into Iraq's rivers, source of much piped water.

The contaminated water is claiming victims: Health officials last month said scores of Iraqis were stricken with hepatitis E in at least two poor districts. Meanwhile, of $786 million in a U.S. reconstruction fund for hospitals, clinics and equipment, only $2 million has been spent. As for schools, although 3,100 have been renovated, an additional 12,000 need to be rebuilt or repaired, the State Department says in its latest Iraq Weekly Status Report.

Up and down the budget tables, reality falls far short of plans.

In all, of $18.4 billion approved by Congress for Iraq reconstruction in 2004, only $1.2 billion has been spent. Even that $18.4 billion in aid is just a start: Joint U.S.-U.N. estimates see $55 billion needed over four years.

Little help is coming from elsewhere, in a world largely alienated when President Bush defied the United Nations to wage war on Iraq. Of $13.6 billion in Iraqi aid pledged by 37 countries a year ago, less than $1 billion has materialized.

Signs of economic revival can be found, and the ICG's 28,000-word analysis cites some:

Planeloads of U.S. cash boosted civil servants' salaries sharply, spurring sales of cars and other consumer items; telephone service has more than doubled from prewar levels; real-estate prices quintupled, and yet inflation is still in check.

Despite more than 100 attacks on oil targets, daily production is back up to 2.5 million barrels of crude.

That's still short of the prewar average of almost 3 million barrels, however, and "wholly inadequate to Iraq's needs," Jabar's U.S. Institute of Peace report says.

Studies conclude that whatever the gains, they're overshadowed by $120 billion in Iraqi foreign debt, much of which will have to be repaid, and outweighed by the mass of Iraq's unemployed.

Hard numbers are lacking, but the CSIS team's report, "Progress or Peril?", says unofficial estimates on unemployment range from 25 to 60 percent of a work force of some 7 million. Besides an army of cashiered soldiers, the jobless ranks were swelled by hundreds of thousands of workers from abandoned state-owned factories — bombed in the invasion or looted and burned afterward.

Ambitious to remake Iraq, the Bush administration dispatched U.S. business planners to Baghdad last year to apply "shock therapy" privatization to the old state-dominated economy, selling off industries to foreigners if necessary.

But the Iraqis resisted, few buyers appeared, and in the end the U.S. occupation "neither privatized nor relinquished the objective," the ICG's "Reconstructing Iraq" says. "As a result, it failed to devise an alternative approach that might have revived ailing state companies."

Putting masses of jobless to work on reconstruction proved too ambitious a goal. The U.S. Embassy in Baghdad reported Oct. 7 that of 2,400 U.S.-financed projects planned, just 373 are under way.

"We are, in fact, trying to construct under some extremely adverse circumstances," embassy construction chief Charles Hess acknowledged. Skilled foreign workers have been fleeing for months.

The circumstances led the U.S. government on Sept. 29 to take one more step in the "vicious circle," shifting $3.46 billion from electric and water repair to other tasks, primarily security.

The security downspin can be blamed in part on the U.S. military's "heavy-handed" cordon-and-search tactics, says a study by the U.S. government-supported RAND Corp. Hostile sweeps through villages and neighborhoods alienated Iraqis and exposed an "overwhelming tendency" to ignore lessons of past counterinsurgencies, writes RAND's Bruce Hoffman.

Analysts agree that shifting security operations to Iraqi forces would help. But for too long U.S. spokesmen "grossly exaggerated" progress in readying the Iraqis, Cordesman says. The GAO review finds they have been insufficiently trained and equipped. In some cases, the only "training" U.S. officers required of new policemen was that they "wear a uniform," the GAO says.

Bush administration claims of 200,000 trained Iraqis have been scaled back to 100,000, one-third of what the U.S. command says is needed. Only 4,700 are army troops — once projected to total 40,000 by now. A new U.S. training commander took charge in June, but as of late September his 600-member command was only half-staffed.

The next major casualty of Iraq's insurgency may be its elections.

The Institute of Peace study details repeated U.S. reversals and delays in moving to true Iraqi political control. "The United States had failed to plan adequately," Jabar writes.

Now the U.S.-devised timetable calls for Iraqis to elect an assembly in January to write a constitution. If violence forces a postponement, the anger will grow. If it produces a patchwork election — with a limited vote in the troubled Sunni Muslim heartland — those without a voice may turn to the gun.

In a land of Sunnis and Shiites, of Arabs, Kurds and Turkmen, civil war is a real possibility, a U.S. National Intelligence Estimate warned this summer. But the Americans behind the bunkers of Baghdad's Green Zone sound determined.

"Failure is not an option," top embassy aide Bill Taylor told reporters Oct. 7.

But neither is "success" at hand, the outside analysts say.

"Iraq's transition to a stable, cohesive democracy is in jeopardy," concludes the International Crisis Group. The way forward is far from clear. "What is most difficult," says Conetta, "is charting a reliable path out of the Iraq mess as we find it today."