What is the balance sheet on Iraq?

We must evaluate the situation in Iraq in terms of the interests of the United States.  If we accept the point of view of our enemies, or even of Iraqis, we are faced with an impossible situation because our enemies want us to lose, and we cannot satisfy all the objectives of all Iraqis - we cannot be the "good guys" to everybody. 

It is possible that we did not think through this problem before the invasion - that by advocating majority rule in Iraq we were also advocating a social revolution, one that would depose the Sunnis from their historically predominant social and political role in favor of the Shia.  But whether or not we were naïve, there is no going back now. 

The question going forward for us is what is best for the United States. This is the perspective that holds the key to the "solution" for us in Iraq.  Since we represent a humane society, we desire that what is good for us be as much as possible what is good for Iraq - indeed, we are willing to sacrifice a great deal for this to be the case - but this cannot become a desire to please our enemies, or to require that our actions be approved by them.

So, how does the ledger on Iraq add up?  Kevin McCullough has an arresting column on the economic successes currently being experienced in Iraq .  Is this whistling past the graveyard?  I think not, although it is only a tile in the mosaic of Iraq, not the entire mosaic.  Amir Taheri supports the idea of successful advances in the Iraqi economy in his recent column datelined Um Qasr in the New York Post

One of the most important books to come out of World War II was Inside the Third Reich, the memoirs of Hitler's war production minister, Albert Speer.  One of the points that Speer made is how much economic activity can be sustained amidst the chaos of war, particularly in the case of the Allies' bombing campaign. 

There is a bombing campaign of a different kind under way in Iraq.  McCullough is saying that amidst it, significant economic activity is taking place, for instance, GDP growth of 13% in 2006, according to McCullough, following GDP growth of 17% in 2005.  (I cannot confirm these numbers independently.)  Concomitant with this, reported previously in AT,

is the now 10% gain in the value of the Iraqi dinar since August, perhaps due to rising interest rates, but a gain in value all the same.  Inflation remains in the range of 50% on an annual basis, where it has been since February 2006  (scroll down for 12-month inflation figures).  McCullough says that private sector unemployment is 30%, a high number, but not an infinitely high one.  So the economic numbers are surprisingly positive.
This doesn't quite square with what we are being told about the refugee problem.  Just after the 2003 campaign to remove Saddam, one of the figures of merit on Iraq was the return of refugees to the country.  During 2006 we have been seeing a flight of refugees from the country.  If reports are accurate, there are now 1 million refugees in Syria and Jordan, or about 4% of the population, and, reportedly, the professional part of it.  Since these are press figures, perhaps they need to be taken with a grain of salt, but there does seem to have been a significant reversal of the direction in which people are voting with their feet between 2003 and 2006.  This is not a plus.  And it comes during a time when there is a growing internal refugee problem as Sunni and Shia areas are being shaken by sectarian violence.  Both internal and external refugees are a symptom of the fracturing taking place in Iraqi society due to sectarian violence.  This is the crisis that is allegedly calling for a dramatic response from the president - that has created the need perceived by some for a surge of U.S. troops.

The question is: how critical the current violence in Iraq is to the United States?  It certainly doesn't look good and there are many constituencies - the left-leaning press, European leadership and public opinion, radical and other Islamic leadership - that would like the U.S. to feel responsibility for this.  Well, we did remove Saddam without, I suspect, appreciating the political role he was providing in maintaining, however despicably, the Iraqi polity.  One suspects that he knew his people better than we did.  Presumably our strategy in Iraq was that we would depose Saddam and then the Iraqis would form a new civil society with our help.  They have proven unable to do this so far, which has effectively left us without a strategy in Iraq that is producing daily returns.  It may still be working, but the timeframe may be too long and it doesn't look good in the meantime.

There is a factor that we in the West probably tend to underestimate in regard to the Third World.  Western societies, and certainly America, are commercial societies.  Most people are occupied in commercial pursuits and most people achieve their wealth and place in society in commerce.  This is particularly true in America where we don't have dukes, but we have Rockefellers, Fords, Morgans, Gates's, Jobs's, etc.  And alongside these great entrepreneurs, we have managers, proprietors and professionals.  This means that there is an entire area of endeavor where people can make their mark outside of politics and power. 

But in Third World countries, there is effectively no independent economy.  The only source of wealth and power is politics, or to put it differently, the only source of wealth is power.  This puts the Sunnis, for instance, in a difficult position.  Being deposed from their historic leading role in Iraqi power, they cannot "go back to" running their auto companies and steel companies and trading companies because these do not exist - yet. 

Power is a zero-sum game rather than the positive-sum game of economics, which is one of the things that makes power disputes so intractable.  And it is naïve to think that all problems can be solved by negotiation, another mistake of the ISG.  History says that in most cases negotiation only occurs either after one party to a dispute has been defeated or after both parties have been exhausted.  We have not arrived at either point in Iraq yet, which is the problem we face.  How do we arrive at this point?  First, let's review where we are - the balance sheet on Iraq so far from an American perspective. 

Iraq balance sheet

American homeland - Our primary concern and responsibility is the American homeland.  Without a secure homeland we cannot project power abroad and cannot fulfill our role of being the world's only effective policeman, however much we may regret that role and however much we seek to limit it.  By going on the offensive in the War on Terror and by implication by going on the offensive in Iraq, we have forced the opposition - Islamic radicalism - to throw in its resources to that fight.  If Iraq succeeds in creating a modern Islamic society, the radicals are through and they know it.  This is a battle they must win.  And it appears that while they are attempting to do this, they do not have the resources to attack us at home.  That is a clear win for the US above and beyond any other consideration.  We have to ask those who want to withdraw from Iraq how they intend to occupy the opposition to keep it from attacking us here at home.  They have no answer to that question; they don't even grasp that it is a question; and they won't blame themselves when they turn out to be wrong about the question. 

Iraqi economy - We may be seeing a win here.  Yes, with high unemployment and with a lot of messiness from the ruthless opposition, but evidence, including the recent rise in the value of the Iraqi dinar, suggests that a corner may be being turned.  And this is in spite of the increase in the refugee population in 2006.

Iraqi society - we are not going to be able to make everybody happy.  We seek to make our enemies unhappy.  We cannot use the happiness of all as our figure of merit in Iraq.  If we do that, we buy into the metric of the opposition.  Essentially, their strategy is to create so much savagery that we recoil from it.  One of our failures has been in the polemical arena in not hanging the murder of their countrymen and coreligionists around the necks of the radicals and nihilists.  They have had to show their hand in Iraq by attacking Muslim society.  We have not capitalized on this appalling strategy and pinned the responsibility for it on them.  This is one of the offensives we do need to surge.

Initially, our enemy was Saddam and his regime.  Now it is any force dedicated to destroying Iraq and keeping it from jelling into a successful civil society with a democratic central government and a functioning private economy.  If you are against that, even for the reason of maintaining your historic position, you are on the opposite side from the US.  We cannot take it as our failure that the opposition has a nihilistic strategy of destruction for the purpose of preventing their fellow countrymen from living decently in the modern world.  This strategy is a statement of their failure, the bankruptcy of their religion and philosophy. 

30 Years' War? - The last great religious war in Europe was the 30 Years' War from 1618 - 1648.  It devastated what is now Germany, killing 30% of the population.  Indeed, the 30 Years' War is why Germany failed to develop as a nation state until the late 19th century.  It may be that we are seeing something like this now between the Sunni and the Shia in Iraq.  Perhaps there is no solution to it except to let it blow itself out.  The Sunni - most injudiciously, to an outsider - laid the predicate for intersectarian slaughter.  This was an incautious step for a minority to take.  While we did get Zarqawi, it appears that he may have achieved his goal of committing such unforgivable atrocities before he died that he lit off an internal war in Iraq.  This may be a situation to which no outsider - even the US - has a solution.  It may simply have to blow itself out.

The military problem - In World War II, our objective was "unconditional surrender" of our enemies.  With unconditional surrender, the political problem is solved militarily but in a limited war, the political problem has a separate but related existence to the military problem.  It is not enough to "rely on the generals."  Solving the civilian-political problem is not their job.  After all, what is their writ?  To destroy our enemies or make friends with them?  The civilians have to make that decision.

It is in the political-civilian area that we have been deficient in our strategy.  It may well have been that our model before deposing Saddam was that there was an Iraqi polity that, absent the terror of Saddam, would be able to work out its problems through democratic means.  If that was our model, it didn't work.  We need a new model.  Do we support majority rule - the al-Maliki government?  That very likely means that we oppose the Sunni insurgency, even though the Sunni in some sense balance out the influence of the Iranian Shia.  Well, that problem is not going to go away.  If we are in a war, we have to want our side to win.  If our side is to win, we must have a side.  That nettle seems not to have been grasped, and no amount of surged troops is going to grasp it.  It must be grasped as a matter of policy and then the troops can be given a military objective.

Should we surge troops?  Wrong question.  The question is (a) what is our objective and (b) what is our strategy for achieving it?  Once we decide these two things, then we must find the leader who can execute on the strategy - the Ulysses Grant of this war - and not rotate him out until the job is finished. 
We must evaluate the situation in Iraq in terms of the interests of the United States.  If we accept the point of view of our enemies, or even of Iraqis, we are faced with an impossible situation because our enemies want us to lose, and we cannot satisfy all the objectives of all Iraqis - we cannot be the "good guys" to everybody. 

It is possible that we did not think through this problem before the invasion - that by advocating majority rule in Iraq we were also advocating a social revolution, one that would depose the Sunnis from their historically predominant social and political role in favor of the Shia.  But whether or not we were naïve, there is no going back now. 

The question going forward for us is what is best for the United States. This is the perspective that holds the key to the "solution" for us in Iraq.  Since we represent a humane society, we desire that what is good for us be as much as possible what is good for Iraq - indeed, we are willing to sacrifice a great deal for this to be the case - but this cannot become a desire to please our enemies, or to require that our actions be approved by them.

So, how does the ledger on Iraq add up?  Kevin McCullough has an arresting column on the economic successes currently being experienced in Iraq .  Is this whistling past the graveyard?  I think not, although it is only a tile in the mosaic of Iraq, not the entire mosaic.  Amir Taheri supports the idea of successful advances in the Iraqi economy in his recent column datelined Um Qasr in the New York Post

One of the most important books to come out of World War II was Inside the Third Reich, the memoirs of Hitler's war production minister, Albert Speer.  One of the points that Speer made is how much economic activity can be sustained amidst the chaos of war, particularly in the case of the Allies' bombing campaign. 

There is a bombing campaign of a different kind under way in Iraq.  McCullough is saying that amidst it, significant economic activity is taking place, for instance, GDP growth of 13% in 2006, according to McCullough, following GDP growth of 17% in 2005.  (I cannot confirm these numbers independently.)  Concomitant with this, reported previously in AT,

is the now 10% gain in the value of the Iraqi dinar since August, perhaps due to rising interest rates, but a gain in value all the same.  Inflation remains in the range of 50% on an annual basis, where it has been since February 2006  (scroll down for 12-month inflation figures).  McCullough says that private sector unemployment is 30%, a high number, but not an infinitely high one.  So the economic numbers are surprisingly positive.
This doesn't quite square with what we are being told about the refugee problem.  Just after the 2003 campaign to remove Saddam, one of the figures of merit on Iraq was the return of refugees to the country.  During 2006 we have been seeing a flight of refugees from the country.  If reports are accurate, there are now 1 million refugees in Syria and Jordan, or about 4% of the population, and, reportedly, the professional part of it.  Since these are press figures, perhaps they need to be taken with a grain of salt, but there does seem to have been a significant reversal of the direction in which people are voting with their feet between 2003 and 2006.  This is not a plus.  And it comes during a time when there is a growing internal refugee problem as Sunni and Shia areas are being shaken by sectarian violence.  Both internal and external refugees are a symptom of the fracturing taking place in Iraqi society due to sectarian violence.  This is the crisis that is allegedly calling for a dramatic response from the president - that has created the need perceived by some for a surge of U.S. troops.

The question is: how critical the current violence in Iraq is to the United States?  It certainly doesn't look good and there are many constituencies - the left-leaning press, European leadership and public opinion, radical and other Islamic leadership - that would like the U.S. to feel responsibility for this.  Well, we did remove Saddam without, I suspect, appreciating the political role he was providing in maintaining, however despicably, the Iraqi polity.  One suspects that he knew his people better than we did.  Presumably our strategy in Iraq was that we would depose Saddam and then the Iraqis would form a new civil society with our help.  They have proven unable to do this so far, which has effectively left us without a strategy in Iraq that is producing daily returns.  It may still be working, but the timeframe may be too long and it doesn't look good in the meantime.

There is a factor that we in the West probably tend to underestimate in regard to the Third World.  Western societies, and certainly America, are commercial societies.  Most people are occupied in commercial pursuits and most people achieve their wealth and place in society in commerce.  This is particularly true in America where we don't have dukes, but we have Rockefellers, Fords, Morgans, Gates's, Jobs's, etc.  And alongside these great entrepreneurs, we have managers, proprietors and professionals.  This means that there is an entire area of endeavor where people can make their mark outside of politics and power. 

But in Third World countries, there is effectively no independent economy.  The only source of wealth and power is politics, or to put it differently, the only source of wealth is power.  This puts the Sunnis, for instance, in a difficult position.  Being deposed from their historic leading role in Iraqi power, they cannot "go back to" running their auto companies and steel companies and trading companies because these do not exist - yet. 

Power is a zero-sum game rather than the positive-sum game of economics, which is one of the things that makes power disputes so intractable.  And it is naïve to think that all problems can be solved by negotiation, another mistake of the ISG.  History says that in most cases negotiation only occurs either after one party to a dispute has been defeated or after both parties have been exhausted.  We have not arrived at either point in Iraq yet, which is the problem we face.  How do we arrive at this point?  First, let's review where we are - the balance sheet on Iraq so far from an American perspective. 

Iraq balance sheet

American homeland - Our primary concern and responsibility is the American homeland.  Without a secure homeland we cannot project power abroad and cannot fulfill our role of being the world's only effective policeman, however much we may regret that role and however much we seek to limit it.  By going on the offensive in the War on Terror and by implication by going on the offensive in Iraq, we have forced the opposition - Islamic radicalism - to throw in its resources to that fight.  If Iraq succeeds in creating a modern Islamic society, the radicals are through and they know it.  This is a battle they must win.  And it appears that while they are attempting to do this, they do not have the resources to attack us at home.  That is a clear win for the US above and beyond any other consideration.  We have to ask those who want to withdraw from Iraq how they intend to occupy the opposition to keep it from attacking us here at home.  They have no answer to that question; they don't even grasp that it is a question; and they won't blame themselves when they turn out to be wrong about the question. 

Iraqi economy - We may be seeing a win here.  Yes, with high unemployment and with a lot of messiness from the ruthless opposition, but evidence, including the recent rise in the value of the Iraqi dinar, suggests that a corner may be being turned.  And this is in spite of the increase in the refugee population in 2006.

Iraqi society - we are not going to be able to make everybody happy.  We seek to make our enemies unhappy.  We cannot use the happiness of all as our figure of merit in Iraq.  If we do that, we buy into the metric of the opposition.  Essentially, their strategy is to create so much savagery that we recoil from it.  One of our failures has been in the polemical arena in not hanging the murder of their countrymen and coreligionists around the necks of the radicals and nihilists.  They have had to show their hand in Iraq by attacking Muslim society.  We have not capitalized on this appalling strategy and pinned the responsibility for it on them.  This is one of the offensives we do need to surge.

Initially, our enemy was Saddam and his regime.  Now it is any force dedicated to destroying Iraq and keeping it from jelling into a successful civil society with a democratic central government and a functioning private economy.  If you are against that, even for the reason of maintaining your historic position, you are on the opposite side from the US.  We cannot take it as our failure that the opposition has a nihilistic strategy of destruction for the purpose of preventing their fellow countrymen from living decently in the modern world.  This strategy is a statement of their failure, the bankruptcy of their religion and philosophy. 

30 Years' War? - The last great religious war in Europe was the 30 Years' War from 1618 - 1648.  It devastated what is now Germany, killing 30% of the population.  Indeed, the 30 Years' War is why Germany failed to develop as a nation state until the late 19th century.  It may be that we are seeing something like this now between the Sunni and the Shia in Iraq.  Perhaps there is no solution to it except to let it blow itself out.  The Sunni - most injudiciously, to an outsider - laid the predicate for intersectarian slaughter.  This was an incautious step for a minority to take.  While we did get Zarqawi, it appears that he may have achieved his goal of committing such unforgivable atrocities before he died that he lit off an internal war in Iraq.  This may be a situation to which no outsider - even the US - has a solution.  It may simply have to blow itself out.

The military problem - In World War II, our objective was "unconditional surrender" of our enemies.  With unconditional surrender, the political problem is solved militarily but in a limited war, the political problem has a separate but related existence to the military problem.  It is not enough to "rely on the generals."  Solving the civilian-political problem is not their job.  After all, what is their writ?  To destroy our enemies or make friends with them?  The civilians have to make that decision.

It is in the political-civilian area that we have been deficient in our strategy.  It may well have been that our model before deposing Saddam was that there was an Iraqi polity that, absent the terror of Saddam, would be able to work out its problems through democratic means.  If that was our model, it didn't work.  We need a new model.  Do we support majority rule - the al-Maliki government?  That very likely means that we oppose the Sunni insurgency, even though the Sunni in some sense balance out the influence of the Iranian Shia.  Well, that problem is not going to go away.  If we are in a war, we have to want our side to win.  If our side is to win, we must have a side.  That nettle seems not to have been grasped, and no amount of surged troops is going to grasp it.  It must be grasped as a matter of policy and then the troops can be given a military objective.

Should we surge troops?  Wrong question.  The question is (a) what is our objective and (b) what is our strategy for achieving it?  Once we decide these two things, then we must find the leader who can execute on the strategy - the Ulysses Grant of this war - and not rotate him out until the job is finished.