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It’s the Oil, Stupid!

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Posted on Jun 26, 2014

Photo by og2t // ou gee tew tee (CC BY-SA 2.0)

By Michael Schwartz, TomDispatch

(Page 2)

The Corrupt Legacy of the U.S. Occupation

Despite his obvious Shia sectarianism, Sunnis gave Maliki time to fulfill his campaign promises. For some, hopes were increased when service contracts were auctioned off to international oil firms with the aim of hiking energy production to that six million barrel mark by 2020. (Some, however, just saw this as the selling off of that national patrimony.) Many Iraqis were initially reassured when oil production began to rise: in 2011, the Hussein-era mark of 2.5 million barrels per day was finally reached, and in 2013 production finally exceeded 3.0 million barrels per day.

These increases raised hopes that reconstruction from the invasion and occupation era would finally begin. With oil prices holding steady at just under $100 per barrel, government oil revenues more than doubled, from about $50 billion in 2010 to more than $100 billion in 2013. This increase alone, if distributed to the population, would have constituted a windfall $10,000 subsidy for each of the five million Iraqi families. It also would have constituted a very promising down payment on restoring the Iraqi economy and its social services. (The electrical system in itself required tens of billions of dollars in new investment simply to restore it to inadequate pre-war levels.)

But none of this oil wealth trickled down to the grassroots, especially in Sunni areas of the country where signs of reconstruction, economic development, restored services, or jobs were hard to discern. Instead, the vast new revenues disappeared into the recesses of a government ranked by Transparency International as the seventh most corrupt on the planet.

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Demanding a Share of the National Patrimony

So here’s where Iraqi oil, or the lack of its revenues at least, comes into play. Communities across Iraq, especially in embittered Sunni areas, began demanding funding for reconstruction, often backed by local and provincial governments. In response, the Maliki government relentlessly refused to allocate any oil revenues for such projects, choosing instead to denounce such demands as efforts to divert funds from more urgent budgetary imperatives. That included tens of billions of dollars needed to purchase military supplies including, in 2011, 18 F-16 jets from the United States for $4 billion. In a rare moment of ironic insight, Time magazine concluded its coverage of the F-16 purchase with this comment: “The good news is the deal will likely keep Lockheed’s F-16 plant in Fort Worth running perhaps a year longer. The bad news is that only 70% of Iraqis have access to clean water, and only 25% have clean sanitation.”

In all fairness to Maliki, his government did use some of the new oil revenues to begin restaffing wrecked government agencies and social service institutions, but virtually all of the new employment went to Shia citizens in Shia areas, while Sunnis continued to be fired from government jobs. This lack of employment—which meant, of course, the lack of oil money—has been key to the Sunni uprising. As Patrick Cockburn of the British newspaper, the Independent, wrote,

“Sunni men were alienated by not having a job because government funds were spent elsewhere and, on occasion, suddenly sacked without a pension for obligatory membership of the Ba’ath party decades earlier. One Sunni teacher with 30 years’ experience one day got a crumpled note under his door telling him not to come to work at his school any more because he had been fired for this reason. ‘What am I to do? How am I going to feed my family?’ he asked.”

With conditions worsening, Sunni communities only became more insistent, supplementing their petitions and demonstrations with sit-ins at government offices, road blockades, and Tahrir Square-type occupations of public spaces. Maliki’s responses also escalated to arresting the political messengers, dispersing demonstrations, and, in a key moment in 2013, “killing dozens” of protestors when his “security forces opened fire on a Sunni protest camp.” This repression and the continued frustration of local demands helped regenerate the insurgencies that had been the backbone of the Sunni resistance during the American occupation. Once lethal violence began to be applied by government forces, guerrilla attacks became common in the areas north and west of Baghdad that the U.S. occupiers had labeled “the Sunni triangle.”

Many of these guerrilla actions were aimed at assassinating government officials, police, and—as their presence increased—soldiers sent by Maliki to suppress the protests. It is notable, however, that the most determined, well planned, and dangerous of these armed responses targeted oil facilities. Though the Sunni areas of Iraq are not major centers of oil production—more than 90% of the country’s energy is extracted in the Shia areas in the south and the Kirkuk region controlled by the Kurds—there are ample oil targets there. In addition to a number of small oil fields, the “Sunni triangle” has almost the entire length of the only substantial pipeline that exits the country (to Turkey), a significant refinery in Haditha, and the Baiji petroleum complex, which contains an electrical power plant serving the northern provinces and a 310,000 barrel per day oil refinery producing a third of the country’s refined petroleum.


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