GAO: Iraq Amassing Oil Profits, But Not Paying For Reconstruction

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According to a GAO report (.pdf) released today, the Iraqi government is doing just fine, at least financially. It already has a cumulative budget surplus of $29 billion, and GAO anticipates a surplus of up to $50.3 billion for the current fiscal year. Oil revenues account for most of this, of course. The price of gas is certainly not hurting Baghdad. But with all that money lying around, very little of it is being spent on the reconstruction of Iraq’s shattered infrastructure—a tab the Iraqi government seems more than willing to let the United States pick up. (In their defense, the Iraqis weren’t the ones who broke it. But Paul Wolfowitz’s claim that reconstruction would be paid for with oil revenue is just another of the pre-war promises that has gone unfulfilled.)

From the GAO:

From 2005 through 2007, the Iraqi government spent an estimated $67 billion on operating and investment activities. Ninety percent was spent on operating expenses, such as salaries and goods and services, the remaining 10 percent on investments, such as structures and vehicles. The Iraqi government spent only percent of total expenditures to maintain Iraq- and U.S.-funded investments such as buildings, water and electricity installations, and weapons…

Since fiscal year 2003, the United States appropriated about $48 billion for stabilization and reconstruction efforts in Iraq; it had obligated about $42 billion of that amount as of June 2008. U.S. agencies spent about $23.2 billion on the critical security, oil, electricity, and water sectors. From 2005 through April 2008, Iraq spent about $3.9 billion on these sectors.

Iraq’s failure to spend money on its own reconstruction has more to do with the government ineptitude and the political situation than anything else, says the GAO. Although the U.S. government has pumped billions of dollars into strengthening Iraqi civilian and security ministries, the Iraqi government still suffers from a “shortage of trained staff, weak procurement and budgeting systems, and violence and sectarian strife.”

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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