- STRATEGIES FOR RESHAPING U.S. POLICY IN IRAQ AND THE MIDDLE EAST

[Senate Hearing 109-21]
[From the U.S. Government Publishing Office]

S. Hrg. 109-21

STRATEGIES FOR RESHAPING U.S. POLICY IN IRAQ AND THE MIDDLE EAST

=======================================================================

HEARING

BEFORE THE

COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE

ONE HUNDRED NINETH CONGRESS

FIRST SESSION

__________

FEBRUARY 1, 2005

__________

Printed for the use of the Committee on Foreign Relations

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COMMITTEE ON FOREIGN RELATIONS

RICHARD G. LUGAR, Indiana, Chairman

CHUCK HAGEL, Nebraska JOSEPH R. BIDEN, Jr., Delaware
LINCOLN CHAFEE, Rhode Island PAUL S. SARBANES, Maryland
GEORGE ALLEN, Virginia CHRISTOPHER J. DODD, Connecticut
NORM COLEMAN, Minnesota JOHN F. KERRY, Massachusetts
GEORGE V. VOINOVICH, Ohio RUSSELL D. FEINGOLD, Wisconsin
LAMAR ALEXANDER, Tennessee BARBARA BOXER, California
JOHN E. SUNUNU, New Hampshire BILL NELSON, Florida
LISA MURKOWSKI, Alaska BARACK OBAMA, Illinois
MEL MARTINEZ, Florida
Kenneth A. Myers, Jr., Staff Director
Antony J. Blinken, Democratic Staff Director

(ii)

C O N T E N T S

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Page

Biden, Hon. Joseph R., Jr., U.S. Senator from Delaware........... 77
Boxer, Hon. Barbara, U.S. Senator from California................ 98
Chafee, Hon. Lincoln, U.S. Senator from Rhode Island............. 96
Coleman, Hon. Norm, U.S. Senator from Minnesota.................. 90
Cordesman, Anthony H., Ph.D., Arleigh A. Burke Fellow in
Strategy, Center for Strategic and International Studies....... 3
Prepared statement........................................... 8
Iraq: Strategy Versus Metrics: The Case for Information-Based
Policy..................................................... 12
``Playing the Course:'' A Strategy for Reshaping U.S. Policy
in Iraq and the Middle East................................ 18
Dodd, Hon. Christopher J., U.S. Senator from Connecticut......... 87
Prepared statement........................................... 89
Feingold, Hon. Russell D., U.S. Senator from Wisconsin........... 93
Prepared statement........................................... 95
Hagel, Hon. Chuck, U.S. Senator from Nebraska.................... 84
Khalil, Peter, Visiting Fellow, Saban Center for the Middle East
Policy, the Brookings Institution.............................. 69
Prepared statement........................................... 73
Lugar, Hon. Richard G., U.S. Senator from Indiana................ 1
Martinez, Hon. Mel, U.S. Senator from Florida.................... 100
Nelson, Hon. Bill, U.S. Senator from Florida..................... 103
Newbold, Gregory S., Lieutenant General, U.S. Marine Corps
(Ret.), Managing Director, Globesecnine........................ 60
Prepared statement........................................... 65
Voinovich, Hon. George, U.S. Senator from Ohio, prepared
statement...................................................... 92
------

Additional Material Submitted for the Record

Natsios, Andrew S., Administrator, USAID:
Letter to Senator Lugar...................................... 118
Enclosure to letter: ``USAID's Iraq Reconstruction Program''. 118

(iii)

STRATEGIES FOR RESHAPING U.S. POLICY IN IRAQ AND THE MIDDLE EAST

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TUESDAY, FEBRUARY 1, 2005

U.S. Senate,
Committee on Foreign Relations,
Washington, DC.
The committee met, pursuant to notice, at 9:03 a.m., in
room SD-419, Dirksen Senate Office Building, Hon. Richard G.
Lugar presiding.
Present: Senators Lugar, Hagel, Chafee, Coleman, Voinovich,
Sununu, Martinez, Biden, Dodd, Feingold, Boxer, Bill Nelson,
and Obama.

OPENING STATEMENT OF HON. RICHARD G. LUGAR, U.S. SENATOR FROM
INDIANA

The Chairman. This hearing of the Senate Foreign Relations
Committee is called to order. The Committee on Foreign
Relations meets for our first hearing on Iraq in the 109th
Congress. In the last Congress we held 23 hearings on Iraq, a
level of scrutiny demanded by the critical impact that the
progress in Iraq has on United States national security.
The remarkable elections held in Iraq over the weekend
demonstrated the courage and the commitment of the Iraqi
people. Despite threats and acts of violence, reports indicate
that millions of Iraqis voted. The results will not be
certified until February 15, but there is little doubt that the
election provides a basis for moving forward with Iraqi self-
government.
Most importantly, the election can strengthen the
legitimacy of Iraqi officials. The impact of having properly
elected leaders in Iraq for the first time could be
substantial. Insurgents may find it tougher to sell their
propaganda that the government has no legitimacy and the United
States is merely an occupying power. In addition, parties and
groups in Iraq that participate in the government will have a
growing stake in its success.
The election, however, does not guarantee that the path to
democracy will be an easy one. The security situation in the
Sunni areas of Iraq will remain extremely tense. Protecting the
newly elected 275-member Transitional National Assembly must be
a security priority. Methods also must be found to include
Sunnis in the government without being unfair to the winners of
the election.
The Iraq election will be viewed by some as the first step
in the United States exit strategy, but we should recognize how
much work is left to be done. The coalition must assign
priority to training Iraqi security forces. Ultimately, our
success at training Iraqis over time will determine how long
United States forces will need to be in Iraq. We must be
prepared to provide stability while Iraqi troops and police
develop their capabilities, particularly during this time of
Constitution-building.
We must also be prepared for the Iraqi Government and the
Iraqi Constitution to develop in directions that are sometimes
not in perfect harmony with our expectations. The election
moves the Iraqis a step closer to achieving democracy, but that
also means that they will be making more decisions about their
future. We anticipate and hope that the new government will
work closely with the United States and embrace democratic,
pluralistic principles. Inevitably, however, it will make some
decisions that we do not like.
Our Embassy in Iraq must work closely with the Iraqi
Government to establish a positive counseling relationship. We
also must undertake a diplomatic offensive in the Middle East,
Europe, and elsewhere to encourage constructive relationships
between the Iraqi Government and other nations.
The President is reportedly seeking an additional $80
billion for support of operations in Iraq and Afghanistan.
Congress should be prepared to take up this proposal when it
arrives and debate it soberly. We do not expect the request to
include more infrastructure reconstruction funds, but we do
expect it will include money to build and to operate the
Embassy in Baghdad and to meet the urgent needs of training and
equipping Iraqi security forces. Passage of such a bill would
be a strong signal to the world and to Iraq about United States
staying power.
We are pleased especially this morning to welcome back to
the committee Dr. Anthony Cordesman, holder of the Arleigh A.
Burke Chair for Strategy at the Center for Strategic and
International Studies. Dr. Cordesman has testified before this
committee on many occasions. We are grateful we can draw on his
knowledge once more today.
We also welcome retired Lt. Gen. Gregory Newbold, Managing
Director of GlobeSecNine and Executive Director of the Potomac
Institute of Policy Studies. Before retirement, General Newbold
was the Director for Operations on the Joint Staff.
Finally, we welcome Mr. Peter Khalil, who was the Director
of National Security Policy for the Coalition Provisional
Authority in Iraq from August 2003 to May 2004. He is now a
Visiting Fellow at the Saban Center for Middle East Policy at
the Brookings Institution.
Today the committee will use Dr. Cordesman's exceptional
paper, ``Playing the Course: A Strategy for Reshaping U.S.
Policy in Iraq and the Middle East,'' to provide a framework
for our discussion of policy issues in Iraq. Following Dr.
Cordesman's testimony, the committee will ask that General
Newbold and Mr. Khalil provide commentary and remarks on Dr.
Cordesman's conclusions and prescriptions.
The committee has taken no position on the contents of Dr.
Cordesman's paper. Rather, it is our hope that by using this
format, our members can have a more productive and focused
dialogue with our witnesses.
When the distinguished ranking member, Senator Biden,
arrives, we will call upon him for his opening statement, but
for the moment we'll proceed with the testimony. Dr. Cordesman,
would you please proceed.

STATEMENT OF ANTHONY H. CORDESMAN, PH.D., ARLEIGH A. BURKE
FELLOW IN STRATEGY, CENTER FOR STRATEGIC AND INTERNATIONAL
STUDIES

Dr. Cordesman. Thank you very much, Senator, and let me
thank the committee for the opportunity to testify. I think it
is clear that our strategy toward Iraq is today our most
important foreign policy issue and I hope the committee will
forgive me if I take just a few extra minutes to outline some
of the views in ``Playing the Course,'' which I do request be
included in the record.
In that paper, I pointed out that the odds of success in
Iraq are roughly even if we pursue the right policies and that
the definition of success is going to be a pluralistic Iraqi
Government that can work its way through years of difficulty
without direct American support and continuing large American
military presence. But I also pointed out that, while the
United States must be prepared for failure in Iraq, exiting is
a tactic and it is not a strategy. It can eliminate the costs
of the war, it can eliminate casualties, but it will inevitably
create at least as many problems as it solves, unless we exit
under conditions that do define success. If we leave a legacy
of political failure, chaos, or civil conflict in Iraq, that is
not a strategy.
Regardless of what we do, we will need to reassess and
rebuild our entire position in the Middle East and Southwest
Asia, restructure our security policy and regional posture in
the area, deal with problems like energy and the problems of a
nuclear Iran.
Let me also say that, while cut-and-run may ultimately be a
necessity, it too is not a strategy. It is a massive defeat.
That is why I am going to argue that we really do need to do
our best to salvage the situation in Iraq. We should not stay
at any cost. We should not abandon Iraq as long as there is any
hope of success.
I think, though, to understand what we can and cannot do in
Iraq we have to begin by admitting that we have to build on the
climate left by past mistakes, and I see nine major mistakes
that we now have to deal with. One is going to war on the basis
of the wrong intelligence and on the basis of a rationale we
have not been able to defend to the world or to the Iraqis.
The second is to bypass the inter-agency process during the
planning and preparation for the war, which has left a legacy
of difficulty in terms of intelligence, the role of State
Department, and civil-military relations.
The third is that we fought the war without any meaningful
plan for stability operations and nation-building and we
allowed political and economic chaos to take place as we
advanced and in the immediate aftermath of Saddam's fall.
Fourth, we did not prepare our military forces for civil-
military missions, to develop human intelligence capabilities
and deal with terrorism and insurgency, to play the role of
occupier in a nation with an alien religion, language, and
culture. As a result, we have forced our military to adapt
under pressure and in the face of a growing enemy.
For a year we assumed that a proconsul in the form of CPA
could govern Iraq and plan its future rather than Iraqis, and
we staffed much of the CPA with inexperienced ideologues, many
of which spent virtually all of their time in a secure enclave
and on 3- to 6-month tours. For a year we developed idealized
plans for political reform that did not survive engagement with
reality, and we focused far too much on national elections and
drafting a constitution and not on effective governance. For a
year we had military leadership that would not work closely
with the leadership of the CPA, and we lived in a state of
denial about the level of popular hostility we faced and a
growing insurgency. For a year we made no effort to create
effective military, security, and police forces that could
stand on their own in dealing with the growing insurgency,
terrorism, and lawlessness. Instead, we saw such forces largely
as a potential threat to our idealized democracy and felt our
forces could easily defeat an insurgency of some 5 to 6,000
former regime loyalists.
Finally, for a year we tried to deal with an Iraqi economy
that was a command kleptocracy as if it could quickly and
easily be converted to a modern market-driven economy. Again,
we sent in far too many advisers with no real area expertise
and with far too little continuity. We created a long-term aid
plan without a meaningful understanding or survey of the
economic problems Iraq faced, without an understanding of
Iraq's immediate needs and expectations, and without the talent
in either the United States Government or the contract
community to implement such a plan or to develop the kinds of
plans and programs that should have been focused on the short-
and medium-term requirement that Iraq actually needed.
Many of the problems we face could have been avoided and I
think it is to the credit of the people in Iraq today that the
past does not have to be the prologue to the future. We have
moved Iraq policy beyond the policy cluster in the Pentagon, we
have weakened the hold of neoconservatives and we have begun to
implement a serious inter-agency approach. We now have an
ambassador and a general that can work together and function as
a civil-military team. We have given sovereignty to the Iraqis
and let them take over the political process. We have begun to
accept the true complexity of the political problems in Iraq
and the level of popular hostility and tension we face.
We have reorganized the U.S. and coalition military posture
to fight a serious counterinsurgency and counterterrorist war.
In fact, we have begun to rethink our entire process of force
transformation to focus on these threats. We have begun to
train Iraqi military, security, and police forces for the
threat they actually face and not for a secure, stable, and
democratic world.
We have, at least partially, understood that our initial
aid plans were unrealistic and that priority has to be given to
short- and medium-term stability and to using dollars as a
substitute for bullets. We have also begun to understand that
USAID in Washington is incompetent in dealing with the
challenge it faces, that outside contractors cannot manage an
effective aid program in Iraq, and that dollars need to go to
Iraqis and not outsiders.
We need to give the Americans now serving in Iraq, and
especially the civilians and military in the field, credit for
these changes. But more does need to be done. When we talk
about this, one problem we face is the lack of meaningful
reporting coming out of the U.S. Government on the nature of
what is happening in the military program, in the insurgency,
and in the economic aid program.
Mr. Chairman, I have put a short paper together on the
metrics that should be provided and I ask again that this be
included in the record.
The Chairman. It will be included in the record.
Dr. Cordesman. Thank you, sir.
I do believe, however, that there are clearly five steps we
do need to take and that these steps could increase our chances
of success well beyond 50-50 during the coming year. First, we
need to do everything we can to demonstrate the independence of
the emerging Iraqi political structure, while encouraging
inclusiveness and some form of federalism and while moving
beyond a focus on elections and the constitution and providing
the full range of support for governance that is needed in the
field and outside the Green Zone.
We cannot measure legitimacy in terms of elections. Iraqis
do not. They measure it in terms of the ability to govern, to
give all Iraqis a fair share of wealth and power, to provide
personal security, employment, and economic opportunity in
terms of education and health service and basic utilities. They
also measure it in terms of the ability of their government to
disagree with the United States and the coalition, to act
independently, and to take over the kind of roles that an
independent government must perform. They look for our
cooperation in terms of international institutions as well as
within the process of the coalition.
Our fascination with elections needs to be matched with a
focus on aiding governance, while we steadily phase down high-
level intervention and pressure on the Iraqi Government. Every
other thing we do will fail if the Iraqis cannot stand alone
and visibly do so. We cannot save a government from itself and
we will destroy it if we try to do so.
Second, we need a clear plan to create the kind of
independent Iraqi military, security, and police forces that
can replace United States and coalition forces except when they
are needed in an advisory role. We do not have 127,000 useful
or meaningful men in today's forces. We have somewhere around 7
to 11,000 that are beginning to have the necessary training and
some of the equipment to deal with an active counterinsurgency
campaign and the threat they face. We have something like two
to three battalions today that can actually stand alone in the
face of a serious insurgent attack. The first battalion with
the kind of armor necessary to survive serious attack went into
service on the 15th of January and its first actual appearance
was during the course of the elections.
I prepared a detailed analysis of what has gone wrong and
right with this effort and if I may impose on the committee I
again ask that it be included in the record.
The Chairman. It will be included in the record.
Dr. Cordesman. Thank you, sir.
The key point in this analysis, however, is simple: Once
again, we will fail in Iraq unless we develop a convincing plan
to create Iraqi forces with the leadership, experience,
equipment, and facilities they need to secure their country
without us and actually implement it. This is the sine qua non
for American action and there is no more devastating critique
of the ongoing failures in United States policy than the lack
of such a plan in a public forum if one exists at all; a plan
that will show the Iraqi people, the region, the Congress, and
the American people that we can actually achieve a meaningful
form of victory in Iraq.
Let me say here too that equipment and facilities are not a
casual issue and they are a major problem in all of the public
reporting on our progress to date. We do not see any indication
that Iraqis are being given any of the equipment we see as
vital to actually conduct operations in high threat areas. In
fact, as an American I often find it contemptible that we so
often criticize Iraqi forces for their behavior when they send
them out to isolated facilities that cannot be protected or in
vehicles without armor or protection when we talk about up-
armoring HMMV's or replacing them with M-113's.
I find it equally strange that we do not report on Iraqi
casualties and that we do not treat their losses as being
important in the way we treat ours. If I may ask an obvious
question, would any Senator or Congressman send their son or
daughter out with the vehicles, with the combat equipment, and
into the facilities where we send Iraqis? Would they expect
them to stay, to defend and operate under these conditions?
Third, we need to complete the reorganization of our aid
effort, to focus on bringing short- and near-term stability in
dealing with the counterinsurgency campaign. Let me make it
clear, I have nothing but respect for the USAID and contract
personnel in the field, who have actually implemented useful
projects and often done so at the risk of their lives. I also
appreciate that the almost mindless focus on long-term aid
efforts that shaped our initial aid request has been replaced
with substantial reprogramming. However, anyone who looks at
the USAID web page sees nothing but a long list of plans and
project efforts that are not tied to any meaningful measures of
effectiveness or to any defendable requirements.
USAID seems to live in a Panglossian fantasy world where no
problems and challenges really exist and no public strategy
plans and metrics of success are needed. We need economic
stability for a nation of nearly 26 million people with an
infrastructure better suited to 16 to 18 million. We need jobs
for a 7.8-million-person workforce that now has at least 30 to
40 percent unemployment. What we have is an aid program based
on American decisions about what is necessary, run largely by
foreign contractors, with far too much money going to non-
Iraqis, much of it to protect projects that end up being
sabotaged or dysfunctional.
The good news is we have only disbursed about $2.5 billion
out of the $18.4 billion in fiscal 2004 aid. The bad news is
that money desperately needed to be spent. What we have seen is
an aid program that hires all of 121,000 Iraqis out of a labor
force of 7.8 million and where the total of Iraqis hired under
the aid program has recently been dropping by about 9,000
Iraqis a week.
I would urge this committee to demand an immediate
appearance by the director of USAID to explain the details of
our aid program, to provide a clear plan for transferring funds
and responsibility to the Iraqi government, to show how our
projects meet valid requirements, and to prove that USAID's
leadership is competent. Unless he can meet every such test,
that leadership should be changed and the aid program should
immediately be transferred to more competent hands.
Fourth, we need a clear declaration of our goals and
principles for Iraq. We need clear and unambiguous statements
from the President and Secretary of State that refute the key
conspiracy theories that poison our relations and undercut the
legitimacy of the Iraqi government. To be specific, we need a
clear statement from the President that we will leave the
moment the Iraqi government asks us to, that we will phase our
forces down as soon as Iraq forces are ready to do the job,
that we will not maintain permanent military bases, that we
will not exploit Iraqi oil wealth or the economy, and that we
will shift our aid funds to Iraq control and to benefit Iraqis,
insisting only that the uses be validated and there be no
corruption or waste.
Fifth, we need to have a regional strategy to support what
we do in Iraq. We must give settling the Arab-Israeli conflict
top priority and make our efforts fully visible. We must act
through the Quartet whenever we can. In spite of our
intervention in Iraq, survey after survey shows there is no
single issue which causes more anger toward the United States
than the Israeli-Palestinian conflict or does more to aid
extremists and terrorists like bin Laden than the lack of
visible high-level United States efforts to revitalize the
peace process and the perception that the United States fights
terrorism, but does nothing to halt settlements and occupation.
I do not for a moment advocate we halt any aspect of our
struggle against terrorism or do anything to compromise the
security of Israel. But we can only adopt the right policies
toward Iraq if we adopt the right policies toward the Arab-
Israel conflict.
Finally, Mr. Chairman, we also need to have a strategy that
deals with the gulf region and with the Middle East that goes
beyond rhetoric about democracy and reform. Far too much of our
recent rhetoric has actually been used by our opponents to
argue that we seek to overthrow governments in the region or to
impose our own leadership. What we need now are practical,
country by country efforts to quietly and steadily support the
reformers in those countries, not noisy outside exiles. We need
to press for achievable evolutionary progress steadily and
without pause. We need to give human rights, the rule of law,
economic reform, and demographic reform the same priority as
democracy. And we need to recognize that democracy cannot work
unless there are meaningful political parties and preparation
for democracy to work.
Thank you very much, Mr. Chairman.
[The prepared statement and related material of Dr.
Cordesman follows:]

Prepared Statement of Anthony H. Cordesman, Arleigh A. Burke Fellow in
Strategy, Center for Strategic and International Studies, Washington,
DC

Several months ago, I laid out the basic elements of a strategy for
dealing with Iraq in an analysis which I called ``Playing the
Course''--a paper that I now request be placed in the record of this
hearing
In doing so, I pointed out that the odds of success in Iraq are at
best even--if one accepts the fact that in the real world the only
definition of success we can actually hope to achieve is some form of
pluralistic Iraqi government that can work its way through years of
political and economic difficulty without direct American military
support.

AN EXIT IS NOT A STRATEGY

I also pointed out that the U.S. must be prepared for failure in
Iraq, but that exiting is a tactic and not a strategy. Exiting Iraq
would eliminate U.S. casualties and the cost of war fighting, but
create as many or more problems as it solves.
Leaving a legacy of political failure, chaos, or civil conflict in
Iraq is not a strategy.
A strategy means that we must reassess and rebuild our entire
position in the Middle East and Southwest Asia, restructure our
security policy and regional posture in an area with some 60% of the
world's proven oil reserves, deal with what Islamist extremism will
claim as a massive victory, cope with a nuclear Iran, and find some way
to reestablish credibility in the world.
``Cut and run'' may become a necessity, but it can never be a
strategy; only a massive defeat.
This is why I have argued that we must do our best to salvage the
situation in Iraq, and to correct our past mistakes. We should not do
this at any cost; but we should not abandon Iraq as long as there is
any serious hope of success.

FACING THE CONSEQUENCES OF OUR OWN MISTAKES

We also should recognize that we are where we are today as much
because of nearly two years of avoidable failures in U.S. policy and
leadership as because of the inherent difficulties in helping Iraq
become a stable and successful nation.
In summary, we have made nine major mistakes:

We went to war on the basis of the wrong intelligence and
with a rationale we could not defend to the world or the
Iraqis.
We bypassed the Interagency process. We ignored warning
after warning by U.S. intelligence experts, State Department
officials, military officers with experience in the region, and
outside experts that we would not be greeted as liberators
fighting a just war, but by a highly nationalistic and divided
people who did not want outsiders and occupiers to determine
their destiny.
We fought the war to remove Saddam from power without any
meaningful plan for stability operations and nation building.
We allowed political and economic chaos to take place as we
advanced and in the immediate aftermath of Saddam's fall.
We did not prepare our military forces for civil-military
missions, to deal with terrorism and insurgency, to play the
role of occupier in a nation with an alien religion, language
and culture, or have the mix of HUMINT and weapons they needed
for the ``war after the war.'' As a result, we forced our
military to slowly adapt under pressure and in the face of a
growing enemy.
For a year, we assumed that a proconsul in the form of the
CPA could govern Iraq and plan its future, rather than Iraqis.
We staffed much of the CPA with inexperienced political
appointees and ideologues that spent virtually all of their
time in a secure enclave and only served for brief three to six
month tours.
For a year, we developed idealized plans for political
reform that did not survive engagement with reality. We focused
far too much on national elections and drafting a constitution
without having a similar focus on effective governance at the
national, regional, and local levels.
For a year, we had military leadership in Iraq that would
not work closely with the leadership of the CPA, and which
lived in a state of denial about the level of popular hostility
we faced and a steadily growing insurgency.
For a year, we made no serious attempt to create Iraqi
military, security, and police forces that could stand on their
own in dealing with a growing insurgency, terrorism, and
lawlessness. Instead, we saw such Iraq forces largely as a
potential threat to our idealized democracy and felt our forces
could easily defeat an insurgency of 5,000-6,000 former regime
loyalists.
For a year, we tried to deal with an Iraqi economy that was
a command kleptocracy as if it could be quickly and easily
converted to a modern market-driven economy. We sent in CPA
advisors with no real experience and no continuity. We created
a ridiculous long-term aid plan without a meaningful
understanding or survey of the economic problems Iraq faced, an
understanding of Iraqi needs and expectations, and the talent
in either the U.S. government or the contract community to
implement such a plan or develop the kind of plans and programs
focused on short and medium-term requirements that Iraq
actually needed.

THE PAST DOES NOT HAVE TO BE PROLOGUE TO THE FUTURE

This past does not have to be a prologue to the future. During
2004, we began to correct many of our past mistakes.

We have moved Iraqi policy beyond the disastrous policy
cluster in the Pentagon, weakened the hold of failed
neoconservatives, and begun to implement a serious Interagency
approach.
We have an ambassador and a commander that can work
together, and much more of a true civil-military team. We still
lack the civilian elements that can support nation building in
high-threat areas, but the U.S. military has found ways to
partially compensate.
We have given sovereignty to the Iraqis and let them take
over the political process.
We have gradually accepted the true complexity of the
political problems in Iraq, the level of popular hostility we
and our forces face, and the seriousness of the insurgent
threat.
We have reorganized the U.S. and Coalition military posture
in Iraq to fight a serious counterinsurgency and
counterterrorist war, and we have begun to rethink our entire
process of force transformation to shift from a Cold War focus
on advanced technology to fight conventional forces to one that
can deal with the very different asymmetric, political, and
ideological threats we actually face.
We have begun to train Iraqi military, security, and police
forces for the threat they actually face, and not for a perfect
secure, stable, and democratic world.
We have partially understood that our aid plans were totally
unrealistic, and that priority must be given to short and
medium term stability and to using dollars as a substitute and
supplement to bullets. We have at least begun to understand
that USAID in Washington cannot deal with the challenge it
faces, that outside contractors cannot manage an effective aid
program in Iraq, and that dollars need to go to Iraqis and not
outsiders.

We need to give the Americans now in Iraq--and especially the
civilians and military actually in the field outside the Green Zone--
full credit for these changes. They have not stood idly by, failed to
adapt, or failed to challenge the many failures in leadership they
received from Washington.
America's ``neoconservatives'' may be an unmitigated national
disaster in shaping policy towards Iraq, and in virtually every other
aspect of foreign policy they have managed to affect. We have seen,
however, that realists, true area experts, and adaptive military
professionals can produce far better answers and have already begun to
compensate for many of our past mistakes.

WHAT MUST BE DONE

The question now is what must be done to reinforce the steps we
have already taken.
I should stress that my proposed answers have had to be formulated
in a climate where there is remarkably little realistic U.S. government
reporting of the metrics necessary to understand the true nature of the
insurgency.
We have little meaningful data on the results of our efforts to
create effective Iraqi forces, the economic problems Iraq faces, and
the actual impact of our aid. We have substituted self-serving polls to
justify our positions rather than to seriously and objectively poll
Iraqi perceptions.
I have prepared a short paper on what needs to be done to improve
the quality of the reporting to the American people and the Congress,
and again, I request that it be included in the record.
Yet, I believe that enough data are available to show that there
are five steps that might well increase our chances of success well
beyond the 50-50 level, and that clearly need to be taken immediately
if we are to move towards success during the coming year:

We must do everything we can to demonstrate the independence
of the emerging Iraqi political structure while encouraging
inclusiveness and some form of federalism, and aiding in the
process of governance.
Our fascination with elections needs to be matched with a practical
focus on aiding governance while we steadily phase down any high level
intervention or pressure on the Iraqi government.
Iraqis do not measure legitimacy primarily in terms of elections.
They measure it in terms of the actual ability to govern, to give all
Iraqis a fair share of wealth and power, to provide personal security,
to provide employment and economic opportunity, to furnish education
and health services, and to provide water, electricity and sewers.
They also measure legitimacy in terms of the ability of an Iraqi
government to implement independent policies, to disagree with the U.S.
and outside powers, and visibly take decisions without anyone looking
over the Iraqi government's shoulder.
We cannot cease to advise, but we must cease to impose. Where
outside support is needed, it also will always be better if it comes
from the U.N., the British, or some broader international effort and
not from unilateral action by the U.S.
Every other thing we do will fail if the Iraqis cannot stand alone
and visibly do so. We cannot save a government from itself, and we will
destroy it if we try to do so.

We need a clear plan to create the kind of independent Iraqi
military, security, and police forces that can replace the U.S. and
Coalition forces except when they are needed in an advisory role.
We need to stop lying to the Iraqis, the American people, and the
world about our efforts to create Iraqi forces.
We do not have 127,000 useful or meaningful men in these forces of
the kind needed to fight an aggressive, experienced, and well-armed
threat. We have somewhere around 7-11,000 that are beginning to have
the training and some of the equipment necessary to directly engage
insurgent forces. We have about two to three battalions that can
honestly stand alone in the face of serious insurgent attack, and the
first battalion with the armor necessary to survive went into service
in mid-January.
I have prepared a detailed analysis of what has gone wrong and
right with this effort, and again, I ask that it be included in the
record. The key point of this analysis, however, is simple: Everything
we do in Iraq will fail unless we develop a convincing plan to create
Iraqi forces with the leadership, experience, equipment, and facilities
they need to secure their country without us and actually implement it.
Creating effective Iraqi forces to replace the Coalition forces is
the sine qua non for American action. There is no more devastating
critique of the ongoing failures in U.S. policy than the lack of such a
plan in public form--if one exists at all. Furthermore, it must be a
plan that shows the Iraqi people, the region, and the Congress and
American people that we can achieve a meaningful form of victory in
Iraq.
Equipment and facilities are not a casual issue. Nothing we have
done to date has begun to be adequate. In fact, as an American, I find
it contemptible that we so often criticize Iraqi forces for their
behavior when we send them out to facilities that cannot be protected
in unprotected vehicles that no American would willingly use with
weapons inferior to their enemies. We then refuse to accurately report
Iraqi casualties along with our own, treating their losses as less
significant than ours.
Would any Senator or Congressman send their son or daughter out
under these conditions if they were Iraqi? Would any member of Congress
expect their son or daughter to stand and die without purpose?
The time has come for the Administration to explain exactly how our
current plans will meet the need for strong and independent Iraqi
forces, and when Iraqi forces will be given the equipment, facilities,
and capabilities they really need to defeat the insurgents on their
own.

We need to complete the reorganization of our aid effort to
focus on bringing short- and near-term stability and to support the
counterinsurgency campaign, and seriously consider replacing
USAID's leadership of the Iraq aid effort.
Politics, governance, and security are critical, but so are
economics. We need a program to meet Iraq's immediate economic needs,
to help bring security, and that is run and implemented by Iraqis in
ways that provide virtually all of the money to Iraqis.
Let me make it clear that I have nothing but respect for those
USAID and contract personnel in the field in Iraq who have actually
implemented useful projects, and done so at the risk of their lives.
Many have become combatant ``noncombatants'' in a world where armed
peacekeeping, nation building, and humanitarian intervention have
become all too common.
I also appreciate the fact that the almost mindless focus on long-
term aid efforts that shaped our initial aid requests has been replaced
with substantial reprogramming for short-term projects that meet Iraqi
needs, give the money to Iraqis, bring stability and support security
efforts.
Anyone who looks at the USAID web page, however, sees nothing but a
long list of plans and project efforts that are not tied to measures of
effectiveness or defendable requirements. USAID in Washington seems to
live in a Panglossian fantasy world where no problems and challenges
really exist and no public strategy, plans, and metrics of success are
needed.
We need economic stability for a nation of nearly 26 million people
whose overall infrastructure is better suited to 16-18 million. We need
jobs for a 7.8-million-person Iraqi work force that now has 30-40%
unemployment. What we still have is an aid program based on American
decisions about what is necessary run largely by foreign contractors
with far too much money going to non-Iraqis--much simply to protect
projects that end up being sabotaged or dysfunctional.
The good news is that we have so far only disbursed $2.5 billion
out of $18.4 billion in FY2004 aid. The bad news is that the money is
desperately needed in Iraq, and that our projects only hire around
121,000 workers out of a work force of 7.8 million and the total has
recently dropped by 8,000-10,000 a week.
I would urge this Committee to demand an immediate appearance by
the Director of USAID to explain the details of our aid program to
Iraq, to provide a clear plan for transferring the funds and
responsibility to the Iraqi government, to show we actually know how
well our projects met valid requirements, and prove that USAID's
leadership is competent.
If he cannot answer these questions to the Committee's
satisfaction, the aid program in Iraq should immediately be transferred
to different hands.

We need a clear declaration of our goals and principles. We do
not need declarations of American values or general good
intentions.
We need clear and unambiguous statements from the President and
Secretary of State that refute the key conspiracy theories that poison
our relations and undercut the legitimacy of the Iraqi government.
To be specific, we need a clear statement from the President that
we will leave the moment the Iraqi government asks us to; that we will
phase down our forces as soon as Iraqi forces are ready to do the job;
that we will not maintain any permanent military bases; that we will
not exploit Iraqi oil wealth or economy in any way; and that we are
shifting our aid funds to Iraqi control and to benefit Iraqis--
insisting only that the uses be validated and there be no corruption
and waste.
These are obvious points, but we have either made them poorly, in
passing, or at too low a level to be meaningful.

Finally, we must give settling the Arab-Israeli conflict top
priority, make our efforts fully visible, and seek to act through
the Quartet of the U.S., EU, U.N., and Russia wherever possible.
In spite of our intervention in Iraq, no single issue creates more
anger and hostility towards the U.S., or does more to aid extremists
and terrorists like bin Laden, than the lack of visible, high-level
U.S. efforts to revitalize the peace process and the perception that
the U.S. fights terrorism but does nothing to halt settlements and
``occupation.''
We must not halt our struggle against terrorism, or do anything to
compromise the security of Israel. We can only establish credibility in
Iraq, the Arab world, and Islamic world, however, if we both adopt the
right polices towards Iraq and towards the Arab-Israeli conflict, and
if we show the same balance in our dealings with Israel and the
Palestinians as we did at Camp David and Tabah.

PLANNING FOR WITHDRAWAL

Let me conclude by saying that neither the positive actions we have
taken during 2004, nor the proposals I have just made can guarantee
success. We are beginning late and we have wasted precious time we did
not have. Success was always uncertain, and the idea Iraq would
suddenly emerge as a success that would transform the Middle East was
always a fantasy that did little more than prove just how decoupled
from reality America's ``neoconservatives'' could be.
We may well have to leave Iraq without achieving the limited
definition of success I gave at the beginning of this testimony. If an
elected Iraqi government asks us to leave, we must do so as quickly and
with as much integrity as possible. The same is true if we are asked to
compromise our military effectiveness or the integrity of our aid
process.
Failure is an option, and will scarcely be the only time the U.S.
has faced defeat.
Abandonment, however, is not an option. If we are forced to leave
Iraq, we should not do so in bitterness or in anger. We should be
prepared to offer aid and assistance. We should make it clear that we
will do what we can regardless of the circumstances. As Vietnam and
China have shown, history endures long beyond anger and frustration,
and so do our vital strategic interests.
In any case, even under the best conditions, we must leave in the
next two to three years, and as soon as Iraqi forces can replace us.
This is not a choice. Being an advisor and a friend is both possible
and desirable. However, no policy in Iraq, this region, or the world
can succeed where the U.S. seeks to keep bases or remains an
``occupier.''
We need to prepare for this contingency now, and the key to that
preparation is two fold:
First, it is to deal with the Israeli-Palestinian conflict
in ways that can ease the anger against us in the Arab and
Islamic worlds, and ultimately give Israel true security.
Second, it is to rebuild and strengthen our relations with
the Southern Gulf states and our other allies in the Arab
world.
This second key to success is the subject for another hearing, but
that we need to act now to make it clear that we will ensure the
security of our Southern Gulf allies in every way we can regardless of
what happens in Iraq. We will not withdraw; we will not leave them
without protection against a nuclear Iran; and we fully understand how
vital they are at a time when 40% of all the world's oil exports pass
daily through the Strait of Hormuz and our Department of Energy
projects that that percentage will raise to nearly 60% by 2025.
Finally, it would be to our vast benefit if the Administration and
the Congress government could be far more cautious about talking about
political reform and democracy in ways our enemies use to say we seek
to overthrow governments in the region and impose our own leaders. What
we need are practical country-by-country efforts to quietly and
steadily support the reformers actually in those countries--not noisy
outside exiles.
We need to press for achievable evolutionary progress. We need to
give human rights, the rule of law, economic reform, and demographic
reform at least the same priority as democracy, and we need to
recognize that democracy cannot work without meaningful political
parties and preparation.
To be blunt, we need a lot less lofty rhetoric, and a lot more
pragmatic action. We need country-by-country strategies and plans that
move progressively towards balanced and stable reform. We need country
teams in each Embassy that can work with both friendly governments and
local reformers on a quiet and steady evolutionary basis. We need to
work with regional experts and media, our allies, and international
institutions.
We don't need slogans; we need meaningful action.
______

Iraq: Strategy Versus Metrics: The Case for Information-Based Policy

It is as easy to propose a strategy for Iraq as it is easy to have
a strong opinion. The problem is to substantiate any such strategy with
something approaching facts. At this point, ``experts'' are proposing
everything from quick withdrawal to staying the course regardless of
cost. The practical reality, however, is that ``experts'' must rely on
media reports; unclassified, public relations-oriented government data;
or sheer seat of the pants guesswork.

1. A FLOOD OF OPINION; A DROUGHT OF FACT

No one who served during Vietnam can fail to notice that there has
been a polarization of the information people do choose to use out of
the limited information available. Those who oppose the war and
continued intervention choose every negative press report convenient to
their case. The supporters of the war ``mirror image'' the opponents by
choosing the favorable data.
The U.S. government has responded by suppressing past reporting
that has proved to be embarrassing, and by avoiding reporting
information that might be negative and ``spinning'' data. This bias in
official reporting is compounded by operational problems. Streams of
individual data requests hit overburdened military and civilian staffs
on the scene without any coherence and coordination. The end result is
no time for structured data collection and reporting, plus the feeling
such exercises are a waste of time.
The end result is confusion, rather than insight. The problem for
policy making is not a lack of strategies, it is a lack of facts. It is
the lack of metrics that can shed some light on what is really
happening and the level of progress, problems, and risk.
Granted, no war ever has perfect metrics, but it would be far
easier to know what strategy the U.S. should propose if an objective
effort was made to pull together the data that are available in ways
that would allow some coupling between strategy and a knowledge of the
facts on the ground.

2. LOOKING AT GOVERNANCE AND POLITICS

The elections to come will help provide a much better picture of
the level of polarization and religious alignment of the Arab Shi'ites;
Arab Sunnis, Kurds, and other minorities. The elections in the
governorates will also be useful, and will the post-election power
brokering and new allotment of government positions.
Metrics of governance, however, may be more useful than metrics of
politics.

One key indicator of stability in Iraq is to map where the
government is in full control, where it has a limited or
insecure presence, and where it is largely absent or
ineffective. It is obvious that in at least four provinces, the
Iraqi government is only partially functioning.
Maps by governorate and city that show the scale of the
insurgency are key measures of the level of risk and
improvement/decline--this is particularly true if such maps
show the population in the area involved. It is obvious that in
some half-secure areas, the government does not meet a key test
from Vietnam days, it cannot operate at night or when
insurgents are in the area.
Similar mapping of government services adds meaning to the
security test. Secure police presence is one key test. Ability
to make government offices secure and functional is another.
It is equally important to map out the actual distribution
of key government services like pensions, economic aid, office
services, etc. Most Iraqis, like most people in the world, need
government services every day. Elections and politics are an
episodic luxury.

All of the above options would be more effective if there was a
census. The rough estimates that say the population is 60% Shi'ite, 20%
Sunni, 15% Kurd, and 5% other are guesstimates first made over a decade
ago. Having an accurate picture of the ethnic and sectarian mix would
greatly aid in understanding how the insurgency tracks relative to such
factors, as well as the true nature of the population size in
threatened areas.

3. PUBLIC OPINION POLLS AND POLITICAL ATTITUDES

Sophisticated, properly structured public opinion polls can be of
great value in understanding Iraqi views and needs. Public opinion
polls based on small samples using limited questionnaires are little
more than statistical drivel. The sample base may be ``statistically
valid'' within a limited range of percentage error in the mathematical
sense, but far too often, the methodology and results are empirically
absurd.
The sample base in many recent polls is far too small and excludes
too many areas and insurgents. Moreover results that cannot be broken
out by area, ethnicity, religion, and social background lump together
so many disparate groups that they provide few insights or no controls
on who is really being surveyed with any adequacy.
The answer, however, is not to avoid public opinion polls. It is
rather to see them as a critical metric worth funding at a high level
of repeated activity with as much data on given localities and areas,
and as much data on attitudes by ethnicity and sect as possible. Some
past polls have provided much of the scope for this, but few recent
polls seem to have made such an effort or to have credible
transparency. A key metric is being ignored or misused.
A key tool is being misused or not used at all.

4. MAPPING WARFIGHTING

It is obvious that the U.S. government is making steadily more
detailed classified efforts to understand the patterns in the fighting
and the nature insurgents at a time what it has virtually suppressed
all meaningful public reporting. Its daily incident reports are no
longer made available on background; the Iraqi government no longer
provides meaningful public estimates of Iraqi casualties, and even the
broad monthly incident totals vary so much from U.S. spokesman to U.S.
spokesman that they seem to have uncertain credibility.
There are several types of summary reporting that would provide far
more insight into the nature of the conflict, some of which the U.S.
provided on a background basis until the fall of 2004:

Providing daily incident breakouts by type and effect by
major city and governorate with national totals. These data
were available in the past. Their censorship does not build
confidence; simply confusion.
Providing meaningful casualty reports by location, cause,
and for all those being attacked by category. The totals of
U.S. killed and wounded are an important measure, but totals
are no substitute for pattern analysis by location and cause.
It is also a serious reflection on the U.S. that it does not
provide any meaningful reporting on Iraqi government, military,
police, and civilian casualties, much less the kind of pattern
and trend analysis that would help show what is happening in
the war.
Reporting on insurgent captures and kills. This again needs
to be by governorate and major city, and show the nationality
and ethic/religious character of those involved where possible.
Estimates of insurgent strength by group and location. These
do not have to be precise, but would both show the scope of the
threat, and whether progress is estimated to be made in
defeating it. The inevitable lack of precision is not an
embarrassment, it is a warning.
Summaries of U.S./Coalition military action. Like all of the
metrics suggested these should not be so precise as to risk
compromising operational security. The various press releases,
however, give no picture of the level of overall military
activity or activity by region, and no picture of the level of
intensity in operations or the resulting trends.

5. REALISTIC METRICS FOR PROGRESS IN CREATING EFFECTIVE IRAQI MILITARY,
SECURITY, AND POLICE FORCES

U.S. efforts to create capable cadres of effective Iraqi military,
security, and police forces seem to be gathering momentum at a time
that the U.S. has again suppressed virtually all meaningful reporting.
Some areas where meaningful metric would be extremely useful are:

Combat effective military, security, and police forces in
terms of manning and unit strength: The kind of meaningless
totals for training and equipped manpower now being issued
produce misleading totals with no correlation to war fighting
or self defense capability. Leadership and quality are the
issue.
Capable forces versus goals over time: The key projection
for strategy is how many effective forces will be created over
time, and is there a stable set of goals to measure progress
by.
Trained manpower by service/type of force showing different
levels of training: ``Trained'' becomes milspeak for
``meaningless'' when it is not tied to a clear definition of
exactly what training is involved.
Equipped by type of equipment: Like ``trained,''
``equipped'' is meaningless when there are no data defining
what this means, and whether it meets valid requirements. For
example, send Iraqis out in unarmored vehicles is not a winning
move if the U.S. needs uparmored Humvees.
Facility metrics: Sending men into soft or undefendable
facilities is a way to either get them killed or see them break
if attacked. Metrics of the adequacy of facilities are as
important as metrics of equipment levels.
Patterns in casualties, and in desertions and defections:
These are simple metrics of how well the Iraqi forces are, or
are not, doing.
Chronologies and maps of Iraqi force engagements and
outcome: These display how well the Iraqis fight.

6. ECONOMIC MAPPING

This may be a need for nation wide economic data focused on long
term planning in the future. To have a future, however, the government
and Coalition needs detailed economic mapping that looks at jobs,
economic activity, and how aid is flowing by major city, by
governorate, and by key area.
It often will not be possible to assemble comparable or complete
data, but this is not operationally necessary. A mosaic of disparate
data will often red flag key problems and areas. Unemployment, access
to health care, and functioning education are key metric. So are power,
sanitation, water, and secure roads. The breakdown of past existing
services in any area is a major warning.
There are critical overlays to such data that help measure the
realities in the war:

Mapping sabotage and economic attacks. Iraqi officials have
issued guesstimates like a $10 billion loss to sabotage.
Incident records need to be used to take a hard look at
economic impacts of both insurgent and Coalition action.
Sabotage that deprives areas or services, cuts or restricts
nation building, and hits at key revenues or economic activity
needs to be mapped and analyzed. The economic impact of the war
should be known.
Understanding the value and impact of aid. From the start,
the public reporting by USAID has been a self-congratulatory
sick joke. Even the FSU only counted actual project starts as
success. Even the Communist system was not bold enough to count
funds obligated or contracts signed as progress. Aid is a key
weapon in counterinsurgency, but the real metrics for judging
its success are:

How well Iraqi expectations and requirements are being
met, not simply whether things are as good or better than
under Saddam, and by area and by group of Iraqis--not by
some national total.
How money is being dispersed in the field by location, and
particularly in high threat or insurgent areas.
How sustainable project completions are in terms of
surviving attack and continuing to function to meet a need
once ``completed.''

Linking aid to counterinsurgency impacts. The reprogramming
of aid has tied substantial funds to local efforts to use
dollars as a substitute for bullets. Mapping this short term
aid flow in insurgent areas is a metric of how aid impacts on
warfighting.

7. THE LIMITS OF DATA

One final, and hopefully obvious, point needs to be made about the
above suggestions. A flood data may produce a flood of analysis but
there is no reason it should produce a flood of wisdom. Every metric
suggested above has limits and can produce confusing and sometimes
contradictory result. No one set of metrics is likely to be decisive,
and trend analysis will be critical.
Nevertheless, any one who has to analyze the current insurgency in
Iraq has to be struck by how many strong opinions have been built on so
weak a foundation of facts.

Iraq: Strategy Versus Metrics: The Case for Information-Based Policy

1. A FLOOD OF OPINION; A DROUGHT OF FACT

2. LOOKING AT GOVERNANCE AND POLITICS

3. PUBLIC OPINION POLLS AND POLITICAL ATTITUDES

4. MAPPING WARFIGHTING

5. REALISTIC METRICS FOR PROGRESS IN CREATING EFFECTIVE IRAQI MILITARY,
SECURITY, AND POLICE FORCES

6. ECONOMIC MAPPING

7. THE LIMITS OF DATA

``Playing the Course:'' A Strategy for Reshaping U.S. Policy in Iraq
and the Middle East

EXECUTIVE SUMMARY

The odds of lasting U.S. success in Iraq are now at best even, and
may well be worse. The U.S. can almost certainly win every military
battle and clash, but it is far less certain to win the political and
economic war. U.S. success is also heavily dependent on two variables
that the U.S. can influence, but not control. The first is the
emergence of a government that Iraqis see as legitimate and which can
effectively govern. The second is the ability to create Iraqi military
and security forces that can largely replace U.S. and other Coalition
forces no later than 2006.
Improving the Odds in Iraq
This paper argues that U.S. success in Iraq is too important for
the U.S. to withdraw in spite of the present odds and that it should
``play the course'' as long as it has a credible chance of success. It
also argues that there are a series of steps that the U.S. can take to
improve the odds of success, many of which build on initiatives that
the U.S. already has underway.
These suggestions affect five separate areas of U.S. effort:

Providing a clear statement of U.S. intentions that will
make it clear the U.S. is seeking to create a viable and
legitimate government in Iraq, and will not stay in Iraq once
this occurs. This statement will address the major conspiracy
theories that undermine U.S. efforts, and be backed by tangible
actions.
Stepping up aid efforts to develop effective governance, and
placing a new emphasis on local as well as national governance.
Giving even higher priority and resources to the effort to
develop effective Iraqi military and security forces.
Altering U.S. methods of warfighting to strengthen the
political content of U.S. strategy and tactics.
Recasting the economic aid effort to focus on Iraqi internal
stability during 2005-2006, and transferring responsibility for
planning, management and execution to the Iraqi government,
while phasing out U.S. contracting efforts as soon as possible.
Know When to Hold Them, Know When to Fold, and Know When to Run
Taking these steps does not mean that the U.S. should ``stay the
course'' if such measures do not work. The U.S. faces too much Iraqi
anger and resentment to try to hold on in the face of clear failure,
and achieving any lasting success in terms of Iraqi political
acceptance means the U.S. must seek to largely withdraw over the next
two years.
To paraphrase an old country and western song, the U.S. needs to
know when to hold them, know when to fold them, and know when to run.
If the U.S. is asked to leave by an Iraqi government, it must leave.
The same is true if Iraqi efforts at governance decisively and/or if
the U.S. cannot create effective enough Iraqi security forces to
largely replace U.S. and coalition forces. Fighting a counterinsurgency
campaign is one thing; the U.S. must not stay if Iraq devolves into
civil war.
There are, however, different ways to leave and some are much
better than others. Stating and demonstrating that the U.S. has the
right intentions will make it clearer to the world that the U.S. made
every effort to succeed and help to defuse the impact of U.S.
withdrawal. Efforts to strengthen the Iraqi government as much as
possible as soon as possible not only raise the odds of success; they
raise the odds that stability will eventually emerge even if the U.S.
is forced to withdraw. Efforts to strengthen the role of the U.N. and
to multilateralize as much of the aid process as possible will have the
same effect.

The Regional Dimension
At the same time, the U.S. must make every effort to strengthen its
position in other parts of the Gulf and the Middle East. Virtually the
same strategy is needed whether the U.S. succeeds or fails in Iraq.
Even ``victory'' in Iraq will be highly relative, and defeat will force
the U.S. to reinforce its position in the entire region. The specific
steps the U.S. needs to take are:

Give the settlement of the Arab-Israel conflict the highest
possible priority in the most visible form possible.
Rebuild U.S. ties to friendly Gulf states like Saudi Arabia
and strengthen ties to all of the GCC states, emphasizing
cooperation in dealing with terrorism and Islamic extremism.
Adopt a more flexible policy in dealing with Iran.
Prepare for the potential impact of problems in Iraq in
dealing with the fighting in Afghanistan.
Recast U.S. energy policy to deal with the reality that the
U.S. will have growing strategic dependence on Gulf and Middle
Eastern oil exports for the next 20 years, and their security
will become steadily more important.
Adopt a realistic approach to political reform in the region
that will improve U.S. relations with both moderate regimes and
with the peoples of the area.
Give the political dimension of counterterrorism a new
priority, addressing the many aspects of the way in which the
U.S. now fights the war of terrorism that needlessly hurt
relations with the Islamic and Arab world, and restrict the
educational, business, and other relations necessary to create
a common effort to deal with terrorism and extremism.

Almost all of these steps are necessary regardless of the outcome
of the U.S. intervention in Iraq, but they become far more urgent if
the U.S. is forced to withdraw or Iraqi governance fails. In short, the
U.S. strategy for Iraq must be part of a broader strategy for the
Middle East, and one founded on pragmatism and not ideology.
Regardless of how we got into Iraq, and regardless of our mistakes
to date, we are there. Our strategic interests are now linked to both
our success and that of the Iraqis. We can certainly survive withdrawal
and failure, but the result will be seen as a serious defeat unless an
Iraqi government emerges that is clearly better than Saddam Hussein's
regime, unless Iraq holds together, and unless Iraq makes progress over
time.
We have set the rules of the game to the extent we can, we hold the
cards we are going to get, and we have made our bet. The most we can do
at this point is hold, fold, or raise the ante. We do not need to rush
towards some form of exit strategy before it is clear whether we will
win or lose.
At the same time, we do not need a pointless ideological commitment
to ``stay the course,'' simply carrying on with what we are already
doing. We need detailed and tangible ideas about how to make things
better, and improve the odds of success. The challenge is how to best
``play the course.'' It is how to take a bad to mediocre hand and
increase the chance of getting a productive outcome.
The fact remains, however, that the odds of success are now at best
even, and may well be worse. Popular anger and hostility towards the
U.S. and Coalition forces has grown steadily since the spring of 2003.
Some 11% of Arab Shi'ites and over 33% of Arab Sunnis saw attacks on
Coalition forces as justified by early 2004.\1\ The vast majority of
Arab Iraqis never saw the Coalition invasion as legitimate, and some
70% wanted Coalition forces to leave Iraq when sovereignty was returned
to the Interim Iraqi Government in June 2004. More than 80% of the
Iraqi Arab's surveyed this summer expressed deep distrust in Coalition
forces.\2\ Iraqis still express hope in the future, but they do not
feel the Coalition is capable of bringing either security or economic
welfare. While no reliable polling has emerged since a new surge in the
fighting in September 2004, it seems virtually certain that Iraq
resentment of the U.S. and Coalition has steadily increased in recent
months.
We must do what we can within very tight time limits, knowing that
we may well fail. Iraq may divide, there may be civil war, and the
Interim Government may fail without leaving a viable option. The end
result of the series of elections to come may well be that the U.S. is
asked to leave, asked to stay on Iraqi terms that largely consist of
our providing aid, or tied to a government that does not have adequate
popular support and legitimacy. ``Playing the course'' does not mean
the U.S. can count on winning, and certainly does not mean staying
beyond the point where ``playing the course'' is no longer productive.
It also means that U.S. programs must be carefully tailored to the
limits imposed by the ``art of the possible.'' Trying to implement the
``art of the desirable'' is an almost certain road to failure.
Accordingly, we need to consider both whether there are steps we
can take to improve the current odds and when and how to leave. To
paraphrase a country and western song, we have to ``know when to hold
them, know when to fold them, and know when to run.'' We also need to
understand that any strategy to ``play the course'' in Iraq must be
tied to a regional strategy that will both increase our chances of
success and our ability to leave under the best circumstances possible.

``AND KNOW WHEN TO HOLD THEM:'' SEEKING AN ACHIEVABLE VICTORY

One key decision has to be made to have any real chance of winning.
This is to define ``victory'' in narrow and pragmatic enough terms so
that we have a credible hope of achieving it. By this standard, success
can be measured as the emergence of an Iraqi government that holds the
country together, offers more in terms of pluralism and the rule of law
than did Saddam and the Ba'ath, which is seen as broadly legitimate by
most Iraqis, and which can establish conditions for economic
development.
As a corollary, we need to recognize that we cannot overcome many
critical forces affecting the situation after more than a year of war
and occupation. These forces include the present level of Iraqi
resentment of the invasion and occupation, Iraqi nationalism, and
cultural and religious tension. Success means the U.S. must transfer
power to an Iraqi government that the vast majority of Iraqis see as
legitimate, and leave Iraq as soon as this is practical--at least to
the extent that the U.S. does not maintain significant military forces
or military bases, and does not maintain the Green Zone and an
``imperial'' Embassy. The U.S. can, at most, stay in Iraq for one or
two more years and it must do what it can as quickly as possible.
Moreover, we need to preserve a sense of history. Iraq has massive
political, security, ethnic, religious, and economic problems that will
take a half a decade to a decade to play out. The chances are that it
will undergo several periods of crisis and instability after we leave.
We can continue to influence this situation, but we can scarcely hope
to control it. We need to understand--and make clear to Iraq and the
world--that the transition to full independence, and American military
withdrawal, place the responsibility for Iraq's future clearly in Iraqi
hands. We must not claim either levels of success or responsibility
that will allow critics to blame the U.S. for future problems it cannot
control.

Defining Success as Narrowly as Possible
A future Iraqi government does not have to be favorable to the U.S.
in any narrow sense. The U.S. does not need Iraqi dependency; it needs
Iraqi success. A neutral government that distances itself from the
U.S., or even one that is aggressively independent, will be perfectly
acceptable. The key test of success is that such a government can hold
the country together, gives every ethnic and religious group a
relatively fair share of wealth and power, does not represent extreme
factions, has no broader regional ambitions, and creates a climate
where both internal stability and the welfare of the Iraqi people is
likely to improve over time.
In fact, from both an Iraqi and regional viewpoint, the stronger
and more independent the Iraqi government becomes the better. The U.S.
does not need a client or dependent, and its best chance for being seen
as having conducted a ``just war'' (or at least an excusable one) is to
show that it leaves when it is asked to and leaves Iraqis clearly in
charge. Put differently, the key in Iraq to knowing how long to ``hold
them'' is having a clear plan to ``fold.''
As a corollary, ``playing the course'' means that there are several
objectives the U.S. not only must not pursue, but also must
conspicuously and openly reject:

One is to try to use Iraq as a tool or lever for changing
the region. The Iraqi example may have some impact over time,
but nothing could be more destructive to regional efforts at
reform than any deliberate effort to use Iraq as some kind of
springboard for change in other countries. A meaningful reform
strategy must be a country-by-country U.S. effort to encourage
the positive evolutionary trends inside each country. Moreover,
the U.S. must accept the fact that any foreseeable government
that is legitimate in Iraqi eyes will sharply oppose present
U.S. policies in dealing with the Israeli-Palestinian conflict
and will be hostile to Israel's present government and
policies.
Iraq must not become a U.S. military base. The U.S. may well
need to maintain a strong advisory effort, but if the U.S.
tries to maintain combat forces and bases under any conditions
other than the broadest-based demand from Iraqis as a whole, it
will do even more to alienate the Iraqi people, the region, and
Islamic world. This does not, however, preclude U.S. efforts to
create a regional security structure--building on institutions
like the GCC--which could tie Iraq to a more stable regional
security posture where the U.S. could both act as the ultimate
guarantor of Iraq's security and work with Iraqi forces in a
regional context.
The U.S. must establish Iraq's independence in terms of its
politics, economics, and above all oil. Iraq may well need
continuing U.S. aid in its political and economic development,
in addition to its military and security forces. The U.S. must,
however, avoid even the image of seeking to continue to
dominate Iraqi politics, and one key aspect of U.S. policy
during 2005 and 2006 must be to relocate the U.S. Embassy and
Green Zone as quickly as possible, and shrink the U.S. Embassy
to something around 20% of its present size. The CPA will be a
lasting model of how not to do things, and its imperial image
has left a legacy that the U.S. must distance itself from as
soon as possible. The U.S. mission in Iraq must be sized to
meet key needs, but the goal must be to make it an equal among
equals, not a center of political power.
Establish total transparency in showing that the U.S. has
not taken any economic advantage of Iraq and has taken no steps
to give U.S. firms a lasting advantage in any aspect of the
Iraqi economy. This does not mean that the U.S. should not
encourage U.S. foreign investment, in oil and in every other
area. It must do so, however, purely in market terms. The U.S.
government, and especially the U.S. Embassy, must be extremely
careful not to lever influence to the unfair advantage of U.S.
firms, and it must cut itself loose from aid contractors as
soon as humanly possible. It must exert Draconian ruthlessness
in stopping any past ORHA, CPA, or U.S. military personnel from
exploiting their past positions.

Clearly Stating U.S. Goals and Intentions in Terms Acceptable to Iraq
and the Region and Demonstrating the U.S. Will Make Good on Its
Policy
The U.S. needs to openly demonstrate to Iraqis, the region, and the
world that it defines success in terms of Iraqi interests, not some
effort to directly serve its economic and strategic interests. So far,
the U.S. has not made this sufficiently clear or even done a good job
of articulating its intensions in ways that reach Iraqis and the
region. President Bush has spoken in generalities, and his senior
officials have either failed to define U.S. intentions and objectives
or have done so in ways that had had little practical impact--such as
speaking in U.S. press conferences.
President Bush should take the opportunity of his reelection and/or
the coming Iraq elections to make a statement to the Iraqi people and
the world that clearly defines U.S. intentions and refutes the most
dangerous conspiracy theories affecting Iraqi and regional behavior. To
be specific, he should state that:

The U.S. will only stay in Iraq until the insurgency is over
and the Iraqi people have chosen a legitimate government, and
will leave immediately if asked to do so by an elected Iraqi
government;
The U.S. has no intention of interfering in Iraqi elections
or internal politics. It will accept any elected government as
legitimate;
The U.S. is training and equipping Iraqi forces to take over
both the defense of the nation and internal security missions,
and will phase out its military presence as Iraqi forces show
they can perform these missions. It will do so earlier, if
asked by the Iraqi government.
The U.S. is bound by the policies set by the Iraqi Interim
Government, and will not conduct military operations that have
not been approved by that government.
The U.S. have no interest in controlling Iraqi oil resources
and exports, and is firmly committed to aiding the Iraqi Oil
Ministry in developing Iraq's resources through open
competition on global market terms. All decisions over the
future development of Iraq's petroleum resources will be made
by the Iraqi government.
The U.S. is not seeking any other economic interest in Iraq,
or any favoritism for U.S. companies.
The U.S. believes that Iraq must have modern, professional
military forces strong and well equipped enough to defend the
nation without relying on U.S. and Coalition forces. The U.S.
will actively aid the Iraqi government in achieving this role.
It will encourage the development of regional security efforts,
possibly including the expansion of the GCC. It will provide
future military support to Iraq only if requested, and will
consult with its regional allies and the U.N. in doing so.
The U.S. will not maintain any permanent military bases in
Iraq, and will transfer all facilities to the Iraqi government
upon U.S. withdrawal.
The U.S. will continue to provide military assistance and
training if the Iraqi government requests this, but actively
encourages other nations to join it in this role.
The U.S. is not seeking to dictate the modernization and
restructuring of the Iraqi economy. It is removing the strings
from its aid process, and will begin to transfer the management
of all U.S. economic aid to the Iraqi government, and allow the
government to use such funds for its own projects using Iraqi
contractors. It will only act to ensure that the projects are
legitimate and are honestly and effectively implemented.
The U.S. will fully withdraw from the Green Zone once Iraq
is secure and an Iraqi government is in place, and will shift
its mission to the size and role of a conventional Embassy.
The U.S. is seeking full debt and reparations forgiveness
for Iraq, and is committed to providing long-term assistance if
this is needed.
The U.S. believes that the role of the U.N. and other
nations in ensuring free and fair elections, providing aid, and
helping to train the Iraqi government and security forces
should be steadily expanded. Its only concern is that the
expansion of multilateralism must be accompanied by effective
plans and the consummate resources.

President Bush not only needs to formally state such goals, he and
U.S. officials will need to regularly repeat them and aggressively
refute conspiracy theories and charges as necessary.

MAKING IRAQI POLITICAL LEGITIMACY REAL

There are two critical variables in Iraq over which the U.S. still
has considerable influence, but no direct control: The first is how
well Iraqis do in shaping their own government, executing governance at
the national and local level, and giving the new Iraq true legitimacy
among all of the key elements of Iraq's population. The second is the
ability and willingness of Iraqi military and security forces to
largely--if not totally--replace U.S. and other Coalition forces no
later than the end of 2006.
Past U.S. actions have helped to create an extraordinarily
demanding political schedule, and which ensures political tension,
turmoil, and a constant risk of turnover in key officials and decision
makers:

November-December: Parties and candidates emerge, party
lists are made public, platforms emerge; polling systems are
defined.
27-31 January (30 January election day): Elections for 275-
person National Assembly.
February-March: Iraqi Transitional Government takes power.
15 August: National Assembly completes draft of permanent
constitution.
15 October: Referendum for permanent constitution.
15 December: Elections for government completed--if
constitutional referendum approves constitution.
31 December: Elected government assumes office.

There are four critical risks that both Iraqis and the U.S. will
face throughout this process, and that Iraqis will probably continue to
face for up to a decade after the U.S. and other coalition forces
withdraw:

The risk that a majority of Arab Sunnis will not participate
in the political process or will be actively hostile to the
U.S. and evolving Iraqi government. The fighting in Fallujah
and other areas may create a more secure climate where Sunnis
see participation as both necessary and desirable. This,
however, is highly dependent on the quality of the aid and
governance that follows the fighting and Sunnis seeing the
government as providing valid political options. The battle for
Fallujah in November 2004 provoked a major increase in attacks
in other areas, and widespread Sunni anger and resentment.
There is a significant risk the Sunnis will not join in the
process and remain actively or passively hostile.
The risk the Shi'ites will divide and see a return to the
kind of violence and insurgency al Sadr has carried out in the
past. It seems likely that the majority of Shi'ites will
support the political process because it is to their advantage.
This does not, however, mean Shi'ite support for the U.S. role,
or that a significant minority of Shi'ites will not be
alienated or follow more radical leaders like Sadr. There is a
natural dilemma in Shi'ite politics. Including leaders like
Sadr can radicalize them, excluding them can lead to violence.
No compromise between Kurd, Arab, and other ethnic factions
can please everyone. The Kurdish leadership has so far been
pragmatic in compromising its demands, and the leaders of the
Iraqi Interim Government have been equally pragmatic in
accepting limited autonomy and de facto federalism. However, a
constitution still has to be written and implemented, oil
revenues and other economic problems must be dealt with, and
serious ethnic problems over land and repatriation must be
dealt with. Above all, the evolution of the Iraqi government
must produce a political process the Kurds trust and are
willing to participate in.
The political and electoral process will either break down,
or--more probably--produce a set of political compromises that
keep the existing leadership in power without allowing for
legitimate opposition, debate, and electoral contests. As of
late November 2003, the Iraqi Electoral Commission had approved
some 156 political parties out of requests by a total of 2l2.
As of that time, no party had had a chance to campaign or
declare a clear program, and many were brand new. The Interim
Government was divided. For example, the Iraqi National Accord
party led by Prime Minister Ayad was opposed by the new
``Iraqi'' party of President Ghazi al-Yawer. The leading
established parties include the KDP and PUK Kurdish parties;
three Shi'ite parties, and no Sunni parties.
The dilemma is that Iraq does need strong and coherent
leadership, but also needs a transparent enough political
process to have legitimacy in the eyes of the Iraq people and
allow minorities and factions to feel they can be heard,
participate in the process, and have a credible hope of being
represented now or in the future. The need to shape an
effective Iraqi political process through the elections in
January, the constitution referendum, and the full elections in
late 2005 would pose an immense challenge in a divided nation,
with little real political experience, even in peacetime.

The Iraqis urgently need as much outside aid as possible in both
learning how to create a political process that can minimize these
risks and making the new Iraqi government as effective as possible. At
the same time, an Iraqi government can only become legitimate and
effective if the U.S. and the international community recognize that
Iraqis and the evolving Iraqi Government must make as many decisions as
possible and that the existing political process must become far more
inclusive and popular in character.
The U.S. cannot reinvent the wheel by trying to change the current
political calendar. No form of U.S. interference can substitute for
Iraqi progress, and the U.S. cannot constantly interfere without
discrediting Iraqi efforts. The U.S. is no longer the decision-maker,
it is an ally.
One of the hardest tasks the U.S. faces over the next two years is
to restrict U.S. actions to aid and advice, and to preserve a proper,
steadily growing, and visible distance between the U.S. team in Iraq
and a sovereign Iraqi government. One method is to try to expand the
role of the U.N. and other nations in providing political advice and
support so that the U.S. is not seen as dictating or as the only
advisor. This could include expanding the role of Britain and other
Coalition states and give them the lead wherever possible. Turning to
other nations, however, is likely to offer only limited help, and will
sometime do little more than introduce new complications.
The most important way to strengthen Iraqi capability to govern,
and Iraqi legitimacy, is to give the Iraqis control over as much of
every aspect of the nation building and security effort as soon as
possible, and let them control and manage their aid resources. It is to
let the Iraqis make their own choices and own mistakes. In general, it
will be far better to have Iraqis do things badly than have Americans
do them badly--and some times even well.

U.S. Aid in Governance: Doing Too Little, Too Late
In this context, it is deeply disturbing to note that as of
November 3, the U.S. had dispersed only $96 million in aid funds for
``democracy'' as part of the Iraq Relief and Reconstruction Program
(IRRP). The U.S. Embassy Weekly Report states that the 2207 Report goal
for the program was originally $831 million, of which the Congress
actually apportioned $541 million.
Even these totals may be misleading. An analyst from the
Congressional Research Service notes that there was no ``recommended''
program (Admin request) for democracy-building activities in the
original FY2004 supplemental, although other activities, such as civil
society and rule of law in the original request could be interpreted as
having something to do with ``democracy.'' Congress added $100 million
for this specific purpose in the enacted legislation. By January 2004,
after the June 2004 transition plan was announced (November 15, 2003),
the Administration shifted funds around to make the democracy sector
larger--it became $458 million, later $451 million. The September 2004
Administration re-allocation request to Congress would have raised
``democracy'' by $180 million to $631 million. It is unclear why the
figure for ``democracy building'' has gone up to $831 million, but it
appears that either Congress moved more money to the justice/democracy
category than the Administration requested or the Administration did a
quick re-think of needs in mid to late-September. As of 11/17/04, the
Administration has only obligated $473 million and spent $118 million
of the $831 million available in ``democracy building'' funds.\3\
Similarly, the U.S. had dispersed only $33 million out of an
apportionment of $290 million in funds for education, refugees, human
rights, and government. (The 2207 Report goal was $379 million.) It had
dispersed only $56 million out of $979 million in funds for justice,
public safety, and civil society. The 2207 Report goal called for
$1,122 million.\4\
If one ignores the fact there are conflicting data, and combines
all of these programs as reported by the Department of State on
November 3, 2004, the U.S. has dispersed a total of only $185 million
out of $1,800 million in apportioned funds, with an original 2207
Report goal that called for $2,332 million. Given the scale of
requirement to prepare for pluralism and some form of federalism, and
the desperate urgency imposed by the political calendar, the current
level of effort simply cannot support anything like the program needed.
The U.S. effort to aid Iraqi governance is not playing the course; it
is staying on the sidelines.
As in every aspect of the U.S. aid program in Iraq, there are many
people in the field doing a good job with the resources they have, and
taking serious risks in doing so. To put it bluntly, however, the U.S.
either has a meaningful program it can actually implement or it does
not. If the U.S. does have anything approaching an adequate program, it
needs to develop a coherent statement of what that program is,
establish clear metrics and milestones, and constantly reexamine its
scale and content separate from other aid activities. If--as seems more
likely--it has incoherent good intentions--and bits and pieces of a
program actually in the field--the entire aid program affecting
governance needs to be recast to suit the level of urgency in Iraq and
the political calendar the U.S. is trying to make work.

The Problem of Local Government
The problems involved are further compounded by the past history of
U.S. mistakes and failure in creating effective local governance
documented in the International Crisis Croup (ICG) report of October
27, 2004. It will be extremely difficult to work out a political
process of power sharing at the top of the central government, and it
will almost certainly be years before the national lists and parties
learn how to work together effectively and develop practical national
political agendas. Effective and legitimate local government at the
provincial, city, and town level is one way to both give each area and
faction representation and to shape the broader democratic process.
As the ICG report describes in detail, basic reforms are needed in
the way the Interim Government deals with provincial and local
governments, in creating effective provincial councils and local
governments, in the role played by the U.S. and its Coalition allies,
and in the role played by the U.N. Creating an effective national
consensus and government also requires that this progress be made in
parallel with the national political process--particularly if Iraqi
political leaders choose lists and rig a national government in the
January 2005 elections which many Iraqis do not regard as legitimate.
Some form of revenue sharing may also be critical if various
regions and factions are to be convinced that they will get a fair
share of the nation's wealth. This is particularly true of oil
revenue--which for the foreseeable future will underpin the national
budget instead of tax and other income sources. It is easy to mistake
``federalism'' as being a matter of political power. It is a matter of
financial power as well, particularly in almost exclusively Sunni areas
like Al Anbar and in the Kurdish dominated north.
U.S. Transparency and the Role of the U.N. and Other Nations
The U.S. needs to publicize its efforts to help Iraq achieve
success in governance and make it clear that its aid program is
designed to help the Iraqis make peaceful pluralistic choices, not
create a U.S. sponsored government. It needs to describe what it is
doing to show it does not favor a given mix of ethnic and religious
groups, and report problems and failures as well as success.
At the same time, the U.S. should make it clear to Iraqis and the
world that when there are problems in governance, U.S. aid and
influence cannot directly alter or correct them. As is the case in
every area of U.S. action, Iraqis must not only be in charge, but be
held publicly accountable. The constant effort to spin every minor
accomplishment into success is precisely the wrong approach.
Transparency and accountability serve three key purposes: (a) the
independence and legitimacy of the Iraqi government and political
process is clear, (b) the U.S. is not held accountable for Iraqi
failures if it stays or withdraws, and (c) Iraqis are pressured to take
responsibility.
The U.S. must demonstrate through its actions that it will actually
begin to leave as soon as the Iraqi government, military, and security
forces can do the job. It needs to demonstrate it through phased
withdrawals and changes in its role. The U.S. should not set rigid
deadlines, which will become targets for insurgents and opponents of
the Iraqi government, but it should seek to do as much as possible
during 2005 and if it does not succeed by the end of 2006, it seems
likely that it will have effectively been defeated. More than 70% of
Iraqis polled wanted the U.S. forces out as early as the fall of 2003,
and the figure was well in excess of 80% by mid-2004.
This is one of many reasons why the U.S. needs to aggressively and
openly seek to expand the role of the U.N. and other nations in helping
Iraq develop its governance and political process. Just seeking
multilateralism expands the legitimacy of the U.S. effort. Achieving
it, particularly if the country becomes more secure, will be much more
important. It will show Iraqis and the world that the U.S. is serious;
that its efforts are designed to create an independent and legitimate
government and that it is seeking to improve, not dictate, Iraq's
future. It will also create an important process of continuity as the
U.S. phases down its effort and if the U.S. has to withdraw rapidly in
a crisis.

REINFORCING THE CURRENT EFFORT TO CREATE EFFECTIVE IRAQI MILITARY AND
SECURITY FORCES

The second critical variable is the ability and willingness of
Iraqi military and security forces to largely--if not totally--replace
U.S. and other Coalition forces no later than the end of 2006. As has
been touched upon earlier, it has been clear since early 2004 that
Iraqis bitterly resent U.S. domination of the military security effort,
and polls in 2004 put hostility at well above the 80% level.
At the same time, poll after poll shows Iraqis see physical
security as the most important single issue in their lives, followed by
economic and educational security. Equally important, the same polls
that reflected the unpopularity of Coalition forces reflected great
popular confidence in the Iraqi army and police--although far more out
of hope for what they might become in the future than their
capabilities at the time the polls were taken.\5\
There is no question that creating the kinds of Iraqi forces that
are required is a high risk effort that will have to be rushed forward
under adverse circumstances. It is also almost certain that if polls
were taken now--after Najaf, Baghdad, Samarra, Fallujah, and Mosul--the
Iraqi people would show far less confidence. Nevertheless, the only
practical solution to popular hostility to coalition forces is to
create strong Iraqi military security forces as soon as possible, and
to keep up the effort regardless of any near term problems and
reversals. ``Iraqiazation'' either has to be made to work, or Iraq will
become a mirror image of the failure of ``Vietnamization'' in Vietnam:
Coalition military victories will become increasingly irrelevant.
The U.S. military and U.S. Embassy now seem to clearly understand
this, as does the Iraqi Interim Government. The failures at the policy
levels of the U.S. government, CPA, and shadow Iraqi government that
gave General Eaton a hopeless mix of tasks and resources through May of
2004 seem to have been corrected. General Petraeus and the Multi-
National Security Transition Command (MNSTC-I) may now be getting much
of the support they need.\6\
It is disturbing, however, that the U.S. has stopped issuing
meaningful public information on the equipment and training effort, and
has cut the content of the Iraq Weekly Status Report to the point where
it has limited value. Like the empty measures of success contained in
USAID reports, the end result is that there is no way to relate what is
happening to any meaningful picture of actual requirements and the
measures of accomplishment that are provided are the kind of empty,
self-congratulatory statements typical of public relations exercises.

Resources to Date
The only data on expenditure cover the Iraq Relief and
Reconstruction Program (IRRP), but do not reflect reprogramming. Taken
at face value, they indicate that the U.S. had dispersed $798 million
for its Security and Law Enforcement Program at a rate of only $8
million a week.\7\ This compares with an original program level of
$3,235 million, which was raised to $5,045 million program for the
FY2004 fiscal year because of reprogramming on September 30, 2004
($1,808.6 million was reprogrammed to ``security and law
enforcement.'')
The true total for such spending is higher, because the figures
just quoted only cover the FY2004 program. Some $51.2 million was
allocated to the Iraqi army in PL-108-11 April 2003. At the urging of
the U.S. Embassy, an additional $1,808.6 million out of the FY2004
total funding for IIRP was reprogrammed to ``security and law
enforcement'' in September 2004.
Unfortunately, the way in which the U.S. government has reported on
aid expenditures in Iraq is so dysfunctional as to be almost totally
misleading.\8\ For example, the Inspector General of the CPA reported
on October 30, 2004 that, ``As of March 2004, the U.S. had obligated
about $58.5 billion to stabilize the security situation in Iraq: About
$57.3 billion for the U.S. military operations and $1.2 billion for
Iraqi security forces.'' These figures dramatize the slow pace of the
U.S. effort to create effective Iraqi forces at the time, although they
also reflect the disparity between a large Coalition force presence in
Iraq and the initial buildup of Iraqi Security Forces, and the problems
in trying to rapidly create effective Iraqi forces in a country with
poor infrastructure, limited administrative capabilities, and in the
midst of an insurgency.

The Status of the Military Training and Equipment Effort in September
2004
As for manning and equipment, the U.S. used to provide reasonably
detailed data on progress in training and equipping Iraqi forces. The
Department of Defense provided the following data as of September 22,
2004.\9\

----------------------------------------------------------------------------------------------------------------
Manning Training
------------------------------------------------------
Service In
Required Actual Untrained training Trained
----------------------------------------------------------------------------------------------------------------
Army..................................................... 27,000 12,699 0 7,910 4,789
National Guard........................................... 61,904 41,461 0 2,189 39,272
Iraqi Prevention Force................................... 6,584 4,417 0 5,489 1,928
Iraqi Special Ops Forces................................. 1,967 651 0 75 576
Air Force................................................ 502 182 0 39 143
Coastal Defense Force.................................... 409 412 0 130 292
------------------------------------------------------
Total.............................................. 77,175 62,822 0 15,832 46,990
----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
Weapons Vehicles Communications Body armor
-------------------------------------------------------------------------------
Required On-hand Required On-hand Required On-hand Required On-hand
----------------------------------------------------------------------------------------------------------------
Army............................ 23,606 15,432 2,298 1,768 3,596 1,021 20,949 6,137
Nationa Guard................... 68,760 37,636 2,142 727 11,209 427 62,032 23,320
Iraqi Prevention Force.......... 8,850 3,300 583 152 1,789 1,583 6,584 2,741
Iraqi Special Ops Forces........ 1,898 1,274 180 67 1,212 115 1,620 605
Air Force....................... 383 0 34 4 21 0 502 0
Coastal Defense Force........... 486 12 15 15 156 1 409 0
-------------------------------------------------------------------------------
Total..................... 103,983 57,653 4,421 2,753 13,764 3,157 71,152 32,803
----------------------------------------------------------------------------------------------------------------

These data reflected serious problems in the progress made as of
September:

The manpower totals do not reflect the fact 25-33% of men
were on leave or in training at any given time. Many men are in
units deployed a considerable distance from their home, and
must travel to give their families their pay, and deal with
family issues.
Figures for training were uncertain, since all men are
trained or in training, but training was often very limited or
did not prepare them for demanding aspects of their mission.
Total armed forces had 55% of weapons authorized for prior
force structure, half of authorized total of 4,421 vehicles,
28% of communications, and 46% of body armor.
The weapons data shown were for small arms and crew served
weapons, and do not reflect Iraqi and U.S. plans to create
heavier forces with armor.
Some armor was being delivered; including at least 35
reconditioned Iraqi tanks, AFVS, and APC and 50 armored cars
from the UAE.
Hoped to get armor for more Iraqi mechanized units from
Jordan and UAE.
DoD stated totals for communications equipment totals were
misleading, because: ``Some radios are on-hand, but they are
interim capability only.'' U.S. advisors feel that civilian and
other radios bought as part of CERP program are adequate, and
communications are much better than statistics show.

The Army then had 12,699 actives of 27,000 man authorized force.

Of active strength, 4,789 are defined as trained (3 weeks
for former military and 8 weeks for new recruits; the vast
majority go through the 8 week course). This total was roughly
18% of authorized strength and 38% of men actually on duty.
Equipment holdings, as of mid-September, were 65% of
authorized weapons, 77% of vehicles, 29% of communications, and
30% of body armor.
Training sufficiently limited so new forces normally need 6-
8 weeks of working with U.S. forces. Were exceptions where
units were rapidly formed out of experienced army personnel and
fought well.
Iraqi commandos had proven to be a well training and
effective source of manpower.

The Iraqi National Guard was Iraq's largest force, but most of it
was not a ``combat ready'' force to fight insurgent battles on its own.

41,461 actives vs. requirement for 61,904. Claims that
39,272 are trained and 2,189 are in training ignored the fact
such training is limited and generally does not prepare most
forces for demanding counterinsurgency and counterterrorism
missions. Their training does prepare them to conduct
``framework operations,'' which do play a significant role in a
counterinsurgency conflict.
Were some effective, combat ready elements.
40 of 44 National Guard Battalions operating with Coalition
forces throughout country. All except those in Fallujah-Ramadi
area were carrying out joint operations with coalition on daily
basis.
Equipment holdings, as of mid-September, are 55% of
authorized weapons, 34% of vehicles, 4% of communications, and
38% of body armor.

The Iraqi Prevention Force had 7,417 men active for a force with an
authorized strength of only 6,584.

DoD reported that 26% have some training.
Equipment was 37% of authorized weapons, 26% of vehicles,
86% of communications, and 41% of body armor.
The creation of such specialized counterterrorism/
counterinsurgency elements was underway, but the force was
anything but ``combat ready.''

Iraqi Special Operations Forces had 651 men active for a force with
an authorized strength of 1,967.

DoD reports that 88% of actives have some training, and that
29% of full authorized force is trained and fielded. This force
will grow once the conditions for doing so are in place and
properly set.
Equipment of 67% of authorized weapons, 37% of vehicles, 10%
of communications, and 37% of body armor.
The creation of such specialized counterterrorism/
counterinsurgency elements is underway. This force was more
combat experienced and proven than any other force in Iraq.

Air Force and Coastal Defense Force were only token forces.
Air Force had 0% of authorized weapons, 12% of vehicles, 0% of
communications, 0% of body armor.
The Status of the Military Training and Equipment Effort as of November
2004
The data the U.S. has made public on Iraqi force development since
September have been cut to the point where they do no longer indicate
whether the serious problems in equipment delays that existed as of
early September are being corrected; all equipment delivery data have
been deleted from the report.
The same is true of data on trained manpower. All breakouts have
been eliminated from public U.S. reporting from the Embassy, Department
of Defense, and Department of State. The only heading in the Weekly
Status Report is now ``Trained/On-Hand.'' This figure has some value,
however, since it reflects the manpower that have been trained and are
still on duty, to avoid the problem of reporting those who are trained
and are not on duty for whatever reason.
Useful data have, however, been provided by the Coalition training
command in Iraq, MNSTC-I, although such data cannot go into the detail
needed to distinguish between the total number of men trained and
equipped, and what are sometimes much smaller numbers of men with fully
adequate training and equipment for counterinsurgency and combat
missions, or show the rapidly increasing size of the cadres of fully
trained officers and NCOs.
These data are current as of November 18, 2004, and are shown
below: \10\

----------------------------------------------------------------------------------------------------------------
On duty,
Force element Current trained and Total
strength equipped authorized
----------------------------------------------------------------------------------------------------------------
Police........................................................ 87,133 47,342 135,000
Special Police Commando Battalions............................ 2,019 900 2,019
Border Enforcement............................................ 16,237 14,593 29,360
Highway Patrol................................................ 925 370 6,300
Bureau of Dignitary Protection................................ 484 484 500
Intervention Force............................................ 6,584 1,816 6,859
Emergency Response Force...................................... 168 168 270
Civil Intervention Force...................................... 1,091 1,091 3,720
National Guard*............................................... 43,318 41,409 55,921
(41,261) ? (61,904)
Special Operations Force...................................... 604 590 1,967
Army.......................................................... 16,634 4,507 27,000
Air Force..................................................... 206 167 502
Coastal Defense Force......................................... 409 536 582
-------------------------------------------------
Total................................................... 173,903 115,882 275,708
Military Forces............................................... (17,249) (5,210) (28,084)
Military and Elite Paramilitary (less National Guard)......... (29,124) (10,491) (49,719)
----------------------------------------------------------------------------------------------------------------
* Data from MNSTC-I are not clear. Data in parenthesis are taken from U.S. Embassy Weekly Status Report of
November 3, 2004.

While the Iraqi security and military forces continue to experience
problems in terms of retention and performance, these totals do reflect
significant progress since the summer of 2004 and a number of Iraqi
combat forces have performed well in the fighting in Najaf, Samarra,
and Fallujah. The performance of the police has been less satisfactory,
but the cadres of properly trained and equipped units is beginning to
increase in significant numbers.
According to MNSTC-I, nine more active Army battalions should
complete their training by the end of December, and all 27 Regular Army
or Intervention Force battalions (including six more from the
Intervention Force) are planned to complete training by the end of
January. This schedule has been maintained despite attacks on training
bases, infrastructure delays due to unexploded ordnance discovered at
one planned base, and forces being deployed to major combat operations
earlier than initially planned. Some battalions have had a number of
AWOLs due to intimidation attacks, and MNSTC-I is working with the
Iraqis to adjust its numbers to reflect those. MNSTC-I is also taking
measures to reduce the likelihood and impact of these in the future,
and to assist them in recruiting of combat veterans.
Two battalions from the Iraqi Intervention Force conducted
operations in Najaf. These same two battalions plus another are
conducting effective combat operations in Fallujah together with two
regular battalions, an Army Commando Battalion, a Police Emergency
Response Unit, and Shewani Special Forces trained by 1st MEF. These
constituted 2,700 Iraqis at their peak. Although not all Army
battalions were at full strength, soldiers who are in the battalions
fought effectively and are certainly ``combat ready,'' with most being
``combat proven.'' The last six battalions from the Iraqi Intervention
Force will complete initial training (fourteen weeks) in the next 30
days.
Sixteen National Guard battalions are conducting operations
effectively at the company level or above, with a number conducting
operations effectively at the battalion level. Many Iraqi National
Guard (ING) units have conducted combat operations. Current plans are
to expand the National Guard from its previous authorized strength of
45 battalions and six brigades to 6 Division HQs, 21 Brigade
Commanders, and 65 battalions.
The number of trained police now include over 31,000 former police
trained in the three-week Transition Integration Program. Over 15,000
police have been trained in the 8-week Academy program of instruction.
Capacity at the 8-week academies in Jordan, Baghdad, and other regional
academies should soon exceed over 3,000 graduates per month.
The numbers for trained border enforcement personnel reflect
training done by major subordinate commands (divisions). Capabilities
among border enforcement personnel vary widely. MNSTC-I has established
a centralized program of instruction for border personnel, presently at
the Jordanian Police Academy with Department of Homeland Security
Instructors. Will move this instruction to Iraq in the near future.

Key Iraqi Force Components
While detailed data are lacking on the progress in training and
equipment, the U.S. military team in MNSTC-I does provide useful data
on the structure and type of training and equipment in key elements of
the emerging Iraqi forces: \11\

Special Police Commando Battalions: The Special Police
Commando Battalions represent the Iraqi Ministry of Interior's
strike-force capability. The commandos--ultimately to be
comprised of six full battalions--are highly vetted Iraqi
officers and rank-and-file servicemen largely made up of prior
service Special Forces professionals and other skilled
servicemen with specialty unit experience.
The Special Police Commando Battalions represent the Iraqi
Ministry of Interior's strike-force capability. The commandos--
ultimately to be comprised of six full battalions--are highly
vetted Iraqi officers and rank-and-file servicemen largely made
up of prior service Special Forces professionals and other
skilled servicemen with specialty unit experience. All members
of the unit are chosen based on loyalty to Iraq and its new
democratic model. The unit focuses primarily on building raid
operations, counter-terrorist missions including anti-airplane
hijacker, kidnapping and other similar missions.
The force resembles more a paramilitary army-type force
complete with heavy weapons, rocket-propelled grenades, AK-47
assault rifles, mortars, and 9mm Glock pistols. The commando
battalions give the MOI a high-end strike force capability
similar to Special Forces units and was quickly stood up to
capitalize on previously existing skill sets in Iraq.
Iraqi Police Service Emergency Response Unit: An elite 270-
man team trained to respond to national-level law enforcement
emergencies. Team members undergo a robust eight-week
specialized training course spawned from the current wave of
anti-Iraqi forces actions.
The mission of the emergency response unit is to provide a
national, high-end, rapid-response law enforcement tactical
unit responsible for high-risk search, arrest, hostage-rescue
and crisis response operations. The emergency response unit is
the predominant force for national-level incidents calling for
a DELTA/SWAT capability and will only be used in extreme
situations by local and national authorities.
The $64.5 million effort is part of a larger mission to
create a nation-level law enforcement investigative and special
operations capability within the Iraqi Ministry of Interior to
counter terrorism and large-scale civil disobedience and
insurgencies throughout Iraq. The capability will eventually
include a Counterterrorism Investigative Unit and Special
Operations Unit. Volunteers for the force must first complete
the standard eight-week basic training course or three-week
transition integration program course for prior service
officers before entering the specialized emergency response
unit training modeled after the U.S. State Department's Anti-
Terrorism Assistance and Bureau of Alcohol, Tobacco and
Firearms training programs.
Of the total force, 235 eligible candidates received rigorous
instruction based on the Anti-Terrorism Assistance Crisis
Response Team training program while the balance of 35 recruits
are part of the Special Operations Explosive Ordinance Team,
based on the State Department's Anti-Terrorism Assistance
Explosive Incident Countermeasures training course.
Team members receive instruction on terrorist incidents,
kidnappings, hostage negotiations, explosive ordnance, high-
risk searches, high-risk assets, weapons of mass destruction,
and other national-level law enforcement emergencies. Officers
also have an opportunity to receive supplementary training in
hostage negotiation, emergency medical procedures, and
counterterrorism task force coordination.
Iraqi Intervention Forces: The Iraqi Intervention Force is
the counter-insurgency wing of the Iraqi army. Ultimately to be
comprised of nine battalions, organized into three brigades,
forces negotiate the standard eight-week basic training all
Iraqi soldiers go through learning basic soldiering skills such
as weapons, drill and ceremony,
Soldier discipline, and physical training skills. After
graduation, IIF battalions spend several weeks and months in
intensive ``military operations in urban terrain'' follow-on
training--otherwise know as ``MOUT'' training. In this period,
soldiers work through instruction in the art of street fighting
and building clearing operations typical to anti-insurgent
operations in cities and towns. Units work in close
coordination with other IA battalions and will be completely
stood-up to the nine-battalion force by early 2005.
Iraqi Special Operations Force: The Iraqi Special Operations
Force--the Iraqi Armed Forces--high-end strike force resembling
U.S. Special Forces units--continues training and operations in
the country with multinational force assistance. The Iraqi
Special Operations Force--the Iraqi Armed Forces' high-end
strike force resembling U.S. Special Forces units--continues
training and operations in the country with multinational force
assistance.
Consisting of two trained battalions, including the 36th
Commando Battalion--an infantry-type strike force--and the
Iraqi Counterterrorism Battalion, the force has been involved
in many operations throughout the country fighting anti-Iraqi
forces with great distinction while continuing the stand-up
effort of the unit. The force will add a third ``support''
battalion to its ranks in the coming months. Training is
conducted at an undisclosed location.
``Selection'' for the force begins in the Iraqi National
Guard and Iraqi army units already operating in the country,
much like typical multinational Special Forces' recruiting
efforts in their own countries. Outstanding recruits
successfully negotiating the vetting process, including
exhaustive background checks, skill evaluations, and unit
evaluations along with literacy, psychological, and physical
tests, are run through various team-building and physical
events meant to lean down the recruit pool. The selection
process runs roughly 10 to 14 days.
The Iraqi Special Forces undergo intense physical, land
navigation, small-unit tactics, live-fire, unconventional
warfare operations, direct action operations, airmobile
operations, counterterrorism, survival, evasion, resistance,
and escape training. Special Forces soldiers are an army's
unconventional warfare experts, possessing a broad range of
operational skills. The unit was formed based on a conversation
between the Prime Minister Ayad Allawi and multinational force
personnel to give the Iraqi Armed Forces a high-end strike
force in its ongoing security mission against anti-Iraqi forces
operating in the country.
Iraqi Army: Iraqi army soldiers negotiate standard eight-
weeks of basic training including basic soldiering skills
instruction in weapons, drill and ceremony, Soldier discipline,
and physical training. Iraqi army soldiers negotiate standard
eight-weeks of basic training including basic soldiering skills
instruction in weapons, drill and ceremony, Soldier discipline,
and physical training. Units negotiate advanced follow-on
infantry, land navigation, and other operational training after
graduation before deployment.
The Iraqi army will ultimately be comprised of 27 battalions
of infantry--including nine special Iraqi Intervention Force
battalions--and three transportation battalions. The army will
be organized into nine brigades and three divisions. The bulk
of the force is slated to be in place by early 2005. Plans to
create heavier and better armored forces are still in flux, but
there are now 259 soldiers in the 1st Mechanized Brigade,
preparing to train with 10 MTLB armored personnel carriers.
These vehicles were drawn from a pool of over 300 armored
vehicles that the Iraqis intend to make ready as the unit
grows. The brigade has 50 T-55 tanks, 48 BMP-1s, 57 MTLBs, 36
Spartans, and 30 BTR-94s already. MNSTC-I hopes to have a
combat ready armored battalion by the end of January and the
time of election, with others to follow.
Iraqi Coastal Defense Force: The Iraqi Coastal Defense Force
is the Iraqi Armed Forces' naval component. Ultimately to
number just more than 400 servicemen, the force also includes a
land-based Coastal Defense Regiment resembling western-type
``Marine'' infantry forces. Land and sea based forces negotiate
IAF eight-week basic training courses before moving on to
follow-on training and sea training for the boat crews.
Boat crews learn the basics in seamanship before moving on to
instruction in advanced seamanship, towing, gunnery, sea
rescue, chart reading, navigation, anti-smuggling, operations,
and rigid inflatable boat integration and small boat drill
instruction. Training is put in the context of a democratically
based maritime sea force.
Primary duties include protecting the country's roughly 50-
mile coastline from smuggling and foreign fighter infiltration
operations as well as the port assets at Umm Qasr in Southern
Iraq and oil assets in the Persian Gulf. The force patrols out
to the 12-mile international water boundary in the Persian Gulf
with five 27-meter long Chinese-made patrol boats and various
other support craft.

Setting the Right U.S. Short and Long-Term Objectives in Aid to Iraqi
Military and Security Forces and Providing the Necessary
Transparency
These numbers and force descriptions show that the Iraqi military
and security forces are now far too weak to take over the security
mission and will almost certainly remain so well into 2005. They also
indicate that the U.S. may be moving too slowly in creating military
forces that can deal with the insurgency problem by 2006. While the
U.S. is seeking to help Iraq build a three division force, it seems
clear that it is not yet committed to creating the kind of national
military forces that can defend the country and give the government
legitimacy and respect.
In practice, the U.S. can only succeed in ``playing the course'' of
the program for training and equipping Iraqi military and security
forces meets the following key short-term and longer-term objectives:

Create effective police and security forces capable of
operating on a nation-wide basis.
Create a suitable mix of military and specially trained and
equipped security forces that can help defeat the insurgencies
in Iraq and come to maintain security without Coalition
assistance.
Create the structure and cadres that will allow an Iraqi
government to expand the Iraqi military to the point where it
is capable of defending the nation and with the size,
professionalism, and equipment to act as an effective, modern
military force for national defense.

This latter objective means creating a longer term U.S. aid and
advisory plan that will give Iraq the modern, professional military
forces it needs for defense and deterrence without risking a return to
either a political role for the armed forces or the kind of military
buildup that could lead to an arms race and a destabilization of the
region.
More broadly, U.S. needs to carefully reexamine the level of effort
it is making in each area. There are serious tradeoffs in force quality
if the training, force building, and equipment effort is rushed. The
end result could be a failed force. Yet, the U.S. can only ``play the
course'' effectively if it works out goals and plans with the Iraqi
Interim Government that go far beyond the 28,000 man armed forces--and
the roughly 40-55,000 man total of military, paramilitary, and National
Guard--the U.S. currently says are ``required.'' This may well mean
scaling up a much larger training and equipment program over time than
the U.S. currently plans.

U.S. Transparency and the Role of Allied Forces
Finally, the U.S. needs to communicate a clear plan for achieving
all three of the previous objectives to the Iraqi people and the
region. Once again, it needs honest and transparent reporting that is
detailed enough to be convincing, while pushing Iraqis towards
responsibility and accountability.
It needs to show that it is truly dedicated to creating legitimate
forces for a legitimate government, and creating the conditions
necessary for a phased U.S. withdrawal. It needs to go back to
reporting systems that are detailed and transparent enough to show the
progress it is making, and minimize the impact of the various
conspiracy theories rampant throughout the country.
The U.S. also needs to keep seeking as much allied and outside
support in the training effort as possible. The U.S. will not get
significant numbers of additional combat troops. In fact, it will be
almost impossible for its current allies to maintain their present
troop strength unless it articulates a clear strategy for both
improving the legitimacy of the Iraqi government and phasing out
Coalition troops. It is one of the many strategic ironies in Iraq that
any serious increase in foreign troops requires a level of internal
security in Iraq that makes them largely unnecessary.
At the same time, an NATO or other country that plays a role in the
training process not only aids a critical mission; it also adds a
degree of transparency and legitimacy to the military effort. Their
presence and activity will make it clear that the U.S. is creating real
Iraqi capabilities, and does intend to leave.
The U.S. State Department announced on November 19, 2004, that
NATO's decision to send military trainers to Iraq was the first
collective, consensus decision the alliance had made on Iraq in two
years, and would substantially increase the number of military trainers
in the country from around 65 to as many as 400. Not clear, however,
exactly when such manpower will arrive and it will require an
additional 1,000 to 1,200 personnel to support the trainers by
providing force protection, logistics, and communications--creating a
mission total of between 1,500 and 1,700 people, some of which will be
drawn from the United States. Most of the new military personnel were
scheduled to be in place within 5 to 6 weeks, and the U.S. military
personnel contributions will come from outside Iraq.\12\

SHAPING THE POLITICAL DIMENSION OF U.S. MILITARY ACTION

The U.S. has already learned that it can win virtually any direct
military battle or clash, but it cannot secure the country. Moreover,
U.S. and Coalition forces are so unpopular that their presence can
create added hostility and new insurgents. This is one key reason for
creating effective Iraqi military and security forces. Winning the
military action is only part of the story. As in Vietnam, if the
interim Iraqi government cannot win the political battle, U.S.
victories in the military battles become irrelevant.
Interoperability, giving the Iraqis the Lead, and Replacement of U.S.
Forces
The very professionalism of the U.S. military often makes it
reluctant to give allied forces major responsibility or a lead role.
There are also very tangible limits to how quickly Iraqi forces can be
trained, equipped, and gain enough experience to be fully interoperable
and take over from U.S. forces.
The key to political and military success will, however, be to
create a pattern of operations where Iraqi forces are as visible as
possible, become truly interoperable, and take over as many security
and military missions as possible. This involves more than the training
and aid effort that has just been discussed. It requires detailed,
ongoing U.S. efforts to transform operations into joint U.S.-Iraqi and
then Iraqi operations as quickly as this can be done with the proper
level of effectiveness.
The Sunni Side of the Political, Military, and Economic Battle
The political and economic battle is very different from the
military one. It will be fought over several months, not days or weeks.
It will extend far beyond the bounds of cities like Fallujah. Barring a
revival of the kind of Shi'ite insurgency led by Al Sadr, it will be a
struggle to give the Iraqi Interim Government enough control over the
Sunni Arab-driven aspects of the insurgency in Iraq to achieve the
following seven objectives:

Defeat insurgents without alienating the Sunnis to the point
where political compromise is impossible: A battle conducted in
a political context in which a coalition and interim government
victory does not become a convincing image of martyrdom in
Iraqi Sunni and Arab eyes. Civilian casualties and collateral
damage should not create convincing images of another Jenin in
the Palestinian West Bank or the massive use of excessive
force.
Establish sufficient security and control to deny Sunni
insurgents and terrorists any major sanctuary and ``no-go''
areas in Fallujah, Anbar province, and Iraq generally. Not only
defeat the insurgents who stay in Fallujah, but prevent their
dispersal or their going under cover to the extent that they
cannot control any major populated area, during daylight and at
night.
Ensure that Iraqi military and security forces demonstrate
enough credibility so that they play a major role in the
battle, can be the most visible security presence in the area
after major fighting is over, and can erase the impression of
failure left by Iraqi forces in April. Further, they should
provide a credible picture to the Iraqi people, the region, and
the world that government forces can--in time--take over a
fully sovereign role from U.S.-led coalition forces and lead to
the coalition's withdrawal.
Establish sufficient security in every high threat area so
that Iraqi security forces and administrators can function in
Fallujah and key cities and towns in Anbar province.
Establish sufficient Iraqi Interim Government political
control over Fallujah, Anbar, and the ``Sunni triangle'' to
give the government a major boost in legitimacy and make
polling and elections possible in the area.
Give the Sunnis incentives to join the political and
electoral process. A significant number of Arab Sunnis must be
persuaded to participate in the political process and January's
election to avoid creating a Shiite- and Arab-Kurdish-dominated
Iraq. The Sunnis controlled Iraq during Saddam Hussein's rule.
Create conditions where there is immediate aid and
compensation and longer-term economic hope. The military effort
must be accompanied by U.S. and Iraqi Interim Government
efforts to institute an effective public-assistance and
economic development process that offers jobs, hope and
incentives to join the interim government as a functioning and
tolerated entity.

This struggle may not be as difficult as it seems, but its course
highly uncertain. The good news is that there is no rigid separation
between Arab Sunni and Arab Shi'ite, and the estimates saying that Arab
Sunnis are 20% of the populations and Arab Shi'ites are 60% are decades
old and are not based on a census. Many Sunnis intermarry and live with
Shi'ites, and most past clashes were the result of attacks by the
Ba'ath regime and not the result of popular tensions. Sunni insurgent
numbers still seem relatively small, perhaps some 12,000-16,000 full
time actives plus perhaps twice to three times that number acting as a
pool of part time insurgents or ``instant'' volunteers. This is
scarcely an insignificant number, but is a small fraction of the more
than five million Arab Sunnis in Iraq.
The bad news is that the U.S. military victory in Fallujah probably
only affected 10-20% of the full time Sunni insurgents in Iraq, and
many seem to have escaped. Other Sunni insurgents attacked throughout
Iraq during the fighting, and had considerable success in starting an
uprising in Mosul. The decision to attack Fallujah was opposed by
Iraq's Sunni president, its leading group of Sunni clerics, and a
number of other Iraqi politicians. Sunni Arab media coverage was almost
universally hostile both inside and outside Iraq, and these negative
images were compounded by TV coverage that appeared to show a U.S.
Marine killing a defenseless, wounded prisoner and then a devastated
and deserted city.
Fallujah illustrates the fact that U.S.-led military victories--
regardless of how convincing in military terms--can only be the prelude
to an ongoing Iraqi-led political and economic struggle mixed with
ongoing efforts to establish security in every part of Iraq. Iraqis,
not Americans, will have to shape the most critical part of their
destiny. U.S. forces can only give them the opportunity to succeed.
Consequently, the Iraqi Interim Government's performance in achieving
all of the above political and economic objectives during the course of
2004-2006 will be the key litmus test of whether the military actions
in the war have meaning and offer Iraqis and the Americans hope of
lasting success.
No one in the United States, the Coalition, and Interim Government
can afford to forget this for a moment in the heat of the fighting.
This is particularly true because the interim government failed to
perform effectively in establishing governance, establishing aid, and
providing security after the U.S. victory in Samarra, and after the
fighting in Najaf and Sadr City. If the interim government does not do
better in Fallujah, Anbar province, and Iraq as a whole, the insurgents
will recover and return, the Sunni Arabs will reject the interim
government and political process, and the political process will be
seriously discredited.
Put differently, it is critical to give the Iraqi Interim
Government help in ``stability operations'' and nation building after
each battle, and give it as much of a lead and visibility as possible
in both the fighting and its aftermath. It is not the U.S. that has to
win in terms of Iraqi and regional perceptions, it is the interim
government.
This ``Iraqi first'' aspect of successful military operations means
highlighting Iraqi military and security operations, not U.S.
operations, and steadily expanding the military security role of Iraqis
over time. It means pushing the government into more successful civil-
military operations and downplaying the U.S. role. It means giving U.S.
commanders large discretionary (CERP-type) aid funds to both ease the
backlash civilian casualties and collateral damage cause to the U.S.,
and to back up Iraqi government civic action programs and cover for any
failures. It also means educating U.S. forces to be extremely sensitive
about the need to build up the interim government's credibility and to
defer to it in ways that reinforce its legitimacy.
The Shi'ite Side of the Political, Military, and Economic Battle
The political and economic battle also requires the U.S. to make
every effort to help the Iraqi Interim Government maintain the support
of the Arab Shi'ite majority, and of the Kurds and other minorities.
This balancing act is now largely Iraqi, but the U.S. does retain
significant influence, and can allocate and reprogram economic aid to
this end.
``Playing the course'' also means supporting the interim government
in its efforts to pressure Sadr to join the political process and
avoiding new clashes driven by his militia. Here again, giving Iraqi
leaders and forces maximum visibility in decision-making and any future
fighting is critical. The most efficient way may be the U.S. military
way; the way to achieve political victory (and minimize any backlash
against the U.S.) will be the Iraqi way.
The U.S. must never forget that losing the Iraqi Shi'ites means
losing the war in terms of any ability to create a representative
government of the kind the U.S. is seeking to create. Like civil war or
being asked to leave by an elected Iraqi government, it is a key
indication the U.S. must leave. This, however, means accepting that a
Shi'ite majority may well emerge with values and goals from those of
the U.S.
It also means exercising care in dealing with Iran. The U.S. cannot
shape its Iran policy around the risk that Iran may challenge the U.S.
and interim government far more directly than it has to date; it
scarcely, however, can ignore this risk.
The Kurdish Side of the Political, Military, and Economic Battle
The U.S. should make it unambiguously clear to the Kurds that it
will support them and the protection of their legitimate rights as long
as they remain part of the Iraqi political process, and will not
support them at all in any effort at separatism or ethic cleaning in
dealing with Iraqi Arabs and other minorities like the Turcomans.
So far, the Kurds have shown they understand the political
realities involved, although they naturally push their cause to the
margin. The U.S. must do nothing to change this perception. It must
also make it clear to the Kurds that if things go wrong in Iraq, it
will not support or protect them as it did with Saddam, either against
their fellow Iraqis or from pressure and threats from Iran, Syria, and
Turkey. The U.S. has no future strategic interest in the Kurds, and no
humanitarian obligation to protect them from the consequences of their
own mistakes.

The Civil Side of U.S. Military Operations and the Need for New Kinds
of Jointness
U.S. troops in Iraq face a serious and dangerous mix of insurgency
and terrorism. The U.S. can subordinate military effective and force
protection to civil and political concerns. At the same time, it seems
clear that some elements of the insurgency will continue indefinitely
into the future, and that the U.S. cannot delay many civic action and
aid activities until something approaching local security is
established.
The U.S. military has already established that it understands the
need to use dollars as well as bullets. It has used the Commander's
Emerging Relief Program (CERP) with considerable effectiveness, and has
since used the reprogramming of aid funds in similar ways. As of
October 2, 2004, the U.S. had dispersed $578.3 million in CERP funds.
Some $150.4 million had gone to police and security services and the
facilities protection service, but the rest had gone to civic action.
Another $383.8 million was approved for a somewhat similar time-urgent
program called the Accelerated Iraq Reconstruction Program (AIRP) in
April 2004.\13\
What is less clear is how good the partnership is between the U.S.
military and the U.S. aid effort in governance and economic programs,
and whether the U.S. Embassy and U.S. command have been able to
establish the necessary level of civil-military jointness in making it
possible to carry out such programs. The poor civil-military relations
between the CPA and previous military command left what at best was a
poisoned chalice.
As will be discussed shortly, one of the keys to success in
economic aid and stability, will be to terminate the U.S. contractor
effort as immediately and fully as possible, and to shift aid planning
and execution to the Iraqi government and Iraqi contractors. Such an
effort, however, requires careful U.S. review in the field and often
hands-on advice and support by U.S. officials and direct, accountable
employees of the U.S. government. It also requires removing non-Iraqi
security personnel as quickly as possible. This will make civil-
military jointness even more critical than in the past.
It also raises an issue that may be too late to address in Iraq,
but that may be critical in the future. The separation of U.S. civilian
authority and operational military commands makes good practical sense
during conventional warfighting. It is far less clear that it should
happen in stability, peacemaking, and nation building operations.
Many of the pointless civil-military tensions, and much of the lack
of effective civil-military coordination, during ORHA and the time of
the CPA were the result of a divided presence coupled to divided
responsibility. The need for truly integrated civil-military operations
(including integrated effort in developing local military, security,
and police forces) is simply too great to permit this to happen in the
future, and such integration should occur in Iraq as quickly as
possible.

ECONOMIC AID AND STABILITY

The U.S. economic aid program in Iraq has had many individual
success and accomplishment, and U.S. AID and contractor personnel have
accomplished a great deal in individual areas in spite of immense
difficulties and the dangers in the field. As an overall effort,
however, U.S. economic aid has lagged far behind the need for urgent
action; has wasted vast resources on an impractical contracting effort;
and reflects U.S. views and priorities. As a result, it is decoupled
from the needs of Iraq, the political and military realities and
pressures in the country, and the need to transition responsibility and
action to the Iraqi government as soon as possible.
The situation is made worse by an almost completely dysfunctional
reporting system within the U.S. government that does not tie plans and
accomplishments to realistic requirements, and that reports different
kinds of aid in separate reports using different categories. It has
been compounded by the CPA's inability to put its ideas about economic
reform into action while sustaining economic distortions like the
massive subsidies provided under Saddam Hussein. It was further
compounded by a focus on longer-term plans and expenditures in a
country where the U.S. faced serious security problems and needed to
act decisively and to begin achieving far more visible results over a
year ago.
The U.S. has had problems in every aspect of its efforts in Iraq
that threaten its ability to ``play the course.'' Its efforts at
economic aid, however, are a uniquely mismanaged mess.
Effective Plans and Action, Not Resources, Are the Problem
Any estimate of either Iraq's near-term or overall needs for aid
can only be a crude guesstimate. Figures like $50-$100 billion have
been quoted for ``medium term relief and reconstruction,'' but they are
not based on either reliable input data or credible models. The present
problem, however, is not one of resources. There are enough funds to
``play the course.''
As of early November, the U.S. had only disbursed $3,255 million of
$18,060 in FY2004 IRRF aid. Disbursements were also running at well
under $50 million a week. It is disturbing that a total of $14,891
million of this total is said to be committed, and $10,437 is said to
be obligated. This kind of ``progress'' may well be wasted on delayed
and unneeded efforts, or vast amounts of overhead and security
expenditures. At the same time, the Inspector General for the CPA has
reported that a total of some $55.1 billion had been provided or
pledged for Iraqi relief and reconstruction. As of September 30, 2004
this included: \14\

$24.1 billion in U.S. appropriated funds, used primarily for
reconstruction. These funds come from three public laws: (a)
PL108-287 provides a total of $300 million in CERP funds under
PL108-287 ($100 million allocated to Iraq). PL108-11 (April
2003) provides $2,475 million in IRRF funds, $802 million in
NRRRF, $684 million in CERP, $51 million for the new Iraqi
Army, $413 million to USAID, and $66 million to the Department
of State. PL108-106 (November 2003) provides $18,439 million in
IRRF, $877 million in CPA OPS/IG, $106 million in IRMO, and
$140 million in CERP.
$28.2 billion in Iraqi funds, used primarily for ongoing
operating expenditures, but also for reconstruction and relief:
$1,724 million in vested funds from frozen funds; $927 million
in seized funds and confiscated cash and property, and $25,782
million in the Development fund for Iraq, financed by oil
revenues, repatriated funds, and money in the oil for food
account.
Some $2.8 billion in donor funds: $849 million in
humanitarian relief, $435 million in IMF EPCA funds, and $1,355
billion in actual deposits for the $13,589 million pledged at
the Madrid International Donors Conference for Iraq
Reconstruction.

Iraq will almost certainly need more aid over the next few years,
as well as debt relief and forgiveness of reparations from the Gulf
War. The immediate task, however, is to put an aid program in place as
soon as possible that helps establish security, meets the urgent needs
of the people, and moves money to Iraqi projects run by Iraqis.
Restructuring the Near Term Approach to Economic Aid and Stabilization
The U.S. Embassy has already successfully sought reprogramming of
$3,460.1 million aid funds to meet urgent security needs. President
Bush approved this transfer on September 30, 2004. It cut $1,074.6
million out of electricity projects and $1,935.6 million in water
projects that could not be executed in a timely way and which faced
many security problems. It added $1,809.6 million to security and law
enforcement, $460.5 million to justice and public safety, $660 million
to private sector employment development, and $80.00 million to
governance. The U.S. has stepped up emergency aid expenditures to deal
with contingencies like Fallujah. There also is a base of valid aid
projects underway that should be successfully pursued.
Nevertheless, there seems ample reason for the U.S. to act
immediately to ``zero base'' the current economic aid effort to achieve
the following objectives:

Ensure adequate financing for short term CERP/AIRP projects
to allow intensive U.S. operations in CY2005 and CY2006, and
make military and political stability efforts the key priority.
The priority is to make things work in Iraq in the middle of
drastic political change, insurgency, and economic crisis. Mid-
and long-term efforts will have priority when--and if--there is
a longer term.
Focus on unemployment and immediate social needs. The latest
weekly report on aid related jobs shows a loss from 68,000 jobs
to 61,000. This trend, however, is irrelevant. The Iraqi labor
force totals at least 7.8 million. More than 11 million Iraqis
are young dependents between 0 and 14 years of age (more than
40% of the population). The U.S. Census Bureau estimates that
there are 4.2 million Iraqis in the critical employment age
between 20 and 24, and more than 2.2 million are male. There
are no accurate employment statistics, but real and disguised
unemployment is probably around 30-40%, and may be 40-60% among
young males. Stability at the local level is the issue. Classic
infrastructure and institutional development must wait.
Put the Iraqis in charge of planning, project development,
and project management for mid- and long-term projects. The
U.S. has not shown any special competence in formulating and
executing such projects. If anything, trying to do things the
U.S. way, with a heavy emphasis on large, long-term
infrastructure projects and construction efforts has helped
convince a large part of the Iraqi people that the U.S. is not
even trying to help them. There will be a continuing need for
the U.S. to review projects, take steps to limit corruption,
and ensure proper completion. The Iraqi government, however,
must be given as much authority as soon as possible, and the
Iraqi people must see that it is in charge.
Encourage short-term and mid-term solutions with clear local
benefits in troubled and high risk areas. The need to do this
should be obvious but the current aid plan still tends to
emphasize mid- to long-term construction. Over $8 billion out
of the $18.4 billion in FY2004 IRRF funds, and puts $5.248
billion into water and electricity projects that are time
consuming and vulnerable.\15\ These efforts may well be needed
in time; but local needs should be met right now and even if
this means patchwork efforts that are not cost-effective.
Minimize the role of USAID in Washington. Iraq is not a
traditional ``client'' for aid, and the USAID contracting
process is a slow moving nightmare oriented towards U.S.
formulated and executed projects. USAID personnel have often
done well in the field, but direction should come out of the
U.S. Embassy and aid flows should be programmed to go directly
to the Iraqi government and contractors.
Minimize or eliminate the use of U.S. or non-Iraqi
contractors. Reliance on large U.S. contractors may have made
some kind of sense at the start. At this point, their overheads
and security costs, and the non-performance of many foreign
subcontractors, is a major problem. It compounds the Iraqi
impression that the U.S. aid effort is not serious and does not
help Iraqis. It adds major delays and creates far more security
risks than letting Iraqis do the job. This effort is not about
``buy American'' and meeting accounting and contracting
standards. It is about nation building and achieving a
strategic result.
Multilateralize the aid process to minimize direct U.S.
responsibility and allow the U.S. to use joint pressure on the
Iraqis to perform. The U.S. should seek to create international
groups to handle key aspects of the aid effort. This is
necessary both to make it clear that the U.S. is not attempting
to dictate and that it is no longer responsible for Iraqi
actions. It is also a key way to seek further aid from other
countries.
Make the aid and economic development process transparent.
No one can talk to Iraqis and not be aware of the fact that
their expectations are grossly exaggerated and they are badly
informed about both what must be done and what is being done.
Part of the problem is that they simply do not know the scale
of the challenges involved. Part is the contrast between the
constant lists of ``accomplishments'' being claimed by the U.S.
and the realities they live with. The U.S. needs to provide far
more honest reporting on the scale of the problems Iraq has
inherited from Saddam's regime, how much must be done to
correct them, the realities of what the U.S. aid program is
actually accomplishing, and how such accomplishments relate to
real world needs and goals.
Make a major point of multilateralizing development aid for
the petroleum sector. It is still far from clear how much
Iraq's oil fields have suffered from mismanagement and the
years of underfunding that began early in the Iran-Iraq War.
The present oil ministry goal of 2.5 MMBD may or may not be
suitable given current reservoir problems. The recent weekly
average of 2.39 MMBD certainly does not meet this goal, or
compare with estimates of 2.8-3.0 MMBD in prewar capacity.\16\
Average oil exports have been ranging from 1.1 to 1.8 MMBD in
2004, generally on the lower side. High oil prices and export
revenues per barrel have allowed Iraq to earn $14.6 billion in
oil revenues in 2004, as of November 2004, but it seems
unlikely that Iraq will earn the $18 billion it earned in 2002,
much less the $22 billion in near term annual earnings the U.S.
projected at the time the war began. Moreover, as of November
2004, the U.S. had actually dispersed only $56 million of
$1,701 million in IRRF aid for oil infrastructure.\17\
There is no single area more critical to the Iraqi economy,
to giving the Iraqi government the resources it needs, and to
refuting charges that the U.S. and Britain are seeking to grab
Iraqi oil than helping the Oil Ministry create an effective
plan to repair and develop Iraq's oil resources in a way that
is multilateral and transparent enough to make it clear to
Iraqis and the world that the U.S. truly wants to help and not
to profiteer.
Push debt and reparations forgiveness to the limit: The last
thing Iraq needs is a burden similar to one place on the Weimar
Republic. A stable and secure Iraq cannot emerge with massive
foreign obligations and debts. Nations in general find it
easier to foreign such obligations than to provide real aid
money, and a major U.S. effort to open pressure all of Iraqi
debtors and reparations holders is a good way to externalize
the aid effort and counter nations that are willing to be
critics, but not to help.
The Paris Club agreement on November 21st to reduce some $31
billion of $38.9 billion in Iraq's debt in three stages is an
80% reduction that does not meet the goal of a 95% reduction
set by the U.S., but is an important step forward, particularly
if it can be extended to all debtors and remain linked to
pressure on Iraq for effective economic reform.\18\ It does,
however, leave Iraq with combination of reparations and
remaining debt that may exceed $120 billion. This is one of the
few political weapons the U.S. has in dealing with outside
powers and it should use it to the maximum extent possible.\19\

Restructuring the Mid- and Long-Term Approach to Economic Aid
In addition to these immediate priorities, the U.S. needs to take a
similar approach to encouraging the Iraqi government to carry out
multilateral and study plans that will allow it to act when (and if)
security and stability are established, and Iraq's longer term needs
can really be established.

Infrastructure planning: Roads, electricity, water, and
sewers: The U.S. has placed far too heavy an emphasis on
infrastructure recovery without having clear Iraqi plans and
priorities, and Iraqi decisions designed to correct the massive
imbalances and inadequacies Saddam's regime created in the
services and facilities provided to given groups. This is an
area where Iraq needs to make hard decisions and choose its own
path, not have the path chosen for it.
The financial sector: The U.S. made some good beginnings in
this area, but Iraqis now see many of its efforts to open up
the financial sector in conspiracy theory terms. The U.S. needs
to shift as much of the burden in this sector to the World Bank
and IMF as possible, and ideally, to work with Iraq to find
some European or Asian nation to take the lead.
State industries: Iraq's state industries are a major
economic millstone around the neck of its development efforts.
They are also a political nightmare. The U.S. should encourage
reform, but distance itself from direct involvement. Let
Iraqis, the IMF/World Bank, and other nations take the lead.
Subsidies: As above. The U.S. has already done enough damage
by failing to come to grips with the problem immediately after
the war, when something might have be done with far more ease.
The agricultural sector: Some progress has already been made
here. Creating an efficient and competitive sector, however,
again involves political issues that the U.S. should be careful
to give the Iraqi government the lead in. Aid efforts should be
as multilateral as possible.
Education: The issue is not facilities; it is quality and
relevance in term of job creation. Unlike some countries in the
region, Iraqis see this on their own. The U.S. role should be
to encourage them to plan and act, and provide aid. It can be
largely passive.
Austerity and Financial Discipline: Iraq needs job creation,
sustainment, and stability first. The U.S. should help it
resist any types of rapid economic reform that will be
internally destabilizing. Landings need to be as soft as
possible.

Plans for U.S. withdrawal and phasing down the U.S. aid effort
should not mean abandoning Iraq. They should instead mean mid- and
long-term aid plans that can actually be implemented on terms the
Iraqis want, can execute, and can sustain. The U.S. also needs to be
careful to multilateralize such efforts as much as possible to give
them international legitimacy, avoid taking responsibilities that
belong with the Iraq government, and demonstrate the legitimacy of its
actions.
``know when to fold and know when to run:'' when and how to get out
While any form of conspicuous U.S. failure in Iraq will be serious
defeat, such a defeat is still all too thinkable and all too possible.
This is why every section of this analysis has not only addressed what
can be done to create some acceptable form of ``victory,'' but the need
to transfer responsibility to Iraqis, and to create the kinds of
transparency that will minimize the political backlash and blame the
U.S. will face if it must withdraw.
As has been stated in the introduction, the key to any feasible
form of ``victory'' is to plan to ``fold'' just as rapidly as the Iraqi
government can take over the political and security burdens, and has
some basis for dealing with the economic crisis. The only way to win
the game in Iraq is to stop playing it as soon as the Iraqis are ready
to take over. Ideally, this should occur no later than the end of 2006,
and take place earlier if Iraqi governance, legitimacy, and security
can be established during 2005.
At the same time, the U.S. does not need the kind of exit strategy
that means deliberately planning for failure. It also does not need to
set deadlines for withdrawal that may well make failure a self-
fulfilling prophecy. The odds may not be good, but they are scarcely
unacceptable and it may well be possible to improve them substantially
during 2005--if the U.S. acts promptly and decisively.
It cannot be emphasized too strongly that the U.S. should not set
deadlines for a U.S. troop presence, or ceilings on U.S. aid. These are
a dangerous signal to the insurgents, who will see such deadlines as a
reason to keep fighting and as a key sign of American weakness and lack
of resolve. They will make it even more difficult to attract and keep
coalition and international support. They also are far more likely to
make Iraqis think about protecting themselves, and make them avoid the
risks of supporting the interim government and nation building process.
Morality and ethic also play a role, not just expediency. This is a war
the U.S. started, and a peace process that it initially bungled. Quite
aside from power politics and strategy, it has a moral and ethical
responsibility to the Iraqi people.
Yet, the U.S. and its allies do need to think and plan for the
``unthinkable.'' They need contingency plans to deal with different
kinds of failure, and they must plan for the possibility that Iraqis
may either demand an exit or the situation may become untenable in
spite of U.S. and allied efforts. No one can guarantee success in Iraq;
or that Iraq will not descend into civil war, come under a strongman,
or split along ethnic or confessional lines. The U.S. must be ready if
the Iraqis fail to move forward and reach a necessary political
consensus, divide or move towards civil war, or ask the U.S. and its
coalition allies to leave.
It is silly and dangerous to deny the possibility this can happen,
or to claim the U.S. can never withdraw. If anything, this encourages
precisely the kind of Iraqi government dependence on the U.S. that will
make things worse for both Iraq and America. The U.S. should make it
clear the length and nature of its effort in Iraq is conditional. It
should make it clear that the Iraqi government has goals it must meet,
that it must take the creation of Iraqi military and security forces
seriously, and must focus on economic, power sharing, and other key
realities and succeed.
Iraqis should know that the U.S. does have credible plans to leave
if an elected government asks it to leave, and to reduce its role and
presence in response to any such legitimate request. It should make it
equally clear that it has a presence to phase out its military role,
and reduce the size of its Embassy, as Iraqi capabilities expand and
the Iraqi political process and capability to govern reaches the point
where an Iraqi government feels it is ready.
Rather than setting deadlines, the U.S. should make it clear that
it is committed to an ``exit strategy'' tied to the Iraqi political
process, and to the ``legitimacy'' of its own position in Iraq. Iraqis
and the world should know the U.S. plans to leave under two conditions:
Whenever this is demanded by a legitimate Iraqi government, or in
phases as Iraqis take over given missions. The U.S. must recognize that
its ability to stay and perform meaning roles over the next few years
is directly linked to a firm and open commitment to leave in the
future.
The U.S. should, however, also make it clear to Iraqis that it will
not stay if the situation deteriorates beyond certain limits. It should
set clear metrics for Iraqi success and continuously pressure Iraqi
leaders and the government to meet them. It should not go beyond aid in
counterinsurgency; it should leave if the political process fails and
the civil war breaks out. It should leave if the Iraqi government and
security forces fail to develop over the next two years, and it should
not attempt to stay if the Iraqi government cannot manage the budget,
economy, or its foreign aid. Any of these contingencies are a clear
message that the U.S. should begin to ``run,'' and should quietly
prepare plans for such action.
Regardless of how the U.S. departs, it should still try to do as
much in withdrawing to ensure that the future situation in Iraq will be
as favorable as possible. It should not take key assets with it, and
should continue with valid aid programs if this is possible. However,
it is one thing to play the game and quite another to try to deal with
defeat by reinforcing failure or ``doubling the bet.'' If it is clear
by 2006 that the U.S. cannot win with its current level of effort, and/
or the situation seriously deteriorates to the point where it is clear
there is no new Iraqi government and security force to aid, the game is
over. There no longer is time to fold; it is time to run.

THE BROADER REGIONAL CONTEXT: HAVING SOMEPLACE ELSE TO ``RUN'' TO

The U.S. must also recognize that the game in Iraq is only one
arrow part of the strategy it must develop in the Middle East. Win,
lose, or draw in Iraq, the U.S. needs to pursue major initiatives that
will improve its overall position in the region, reassure it allies,
and allow it to stay in an area with some 63% of the world's proven oil
reserves and some 37% of its natural gas.
In the worst case of force withdrawal, the U.S. must also be ready
with major efforts to reassure the friendly Gulf states and other Arab
allies, demonstrate that the U.S. will maintain a major presence in the
Gulf, contain any risk that civil conflict in Iraq will spill over into
other countries, contain any Iranian actions, and deal with the
inevitable Islamist claims of ``victory.''
The U.S. must make every effort to strengthen its position in other
parts of the Gulf and the Middle East. Virtually the same strategy is
needed whether the U.S. succeeds or fails in Iraq. Even ``victory'' in
Iraq will be highly relative, and defeat will force the U.S. to
reinforce its position in the entire region. The specific steps the
U.S. needs to take are:

Giving Solving the Arab-Israeli Conflict the Highest and Most Visible
Priority
Arafat's death has created an opportunity that the U.S. must act
upon as immediately as possible. There is nothing to be gained from
waiting for two inadequate governments to try to bludgeon each other
into peace. A common solution cannot be imposed by force, and the U.S.
and Arab world will never agree on all the details of a final
settlement. The time has come, however, for an open and continuing
effort by both the Quartet and Arab world to define a final settlement,
and to build on the lessons of Camp David and Taba.
The time has come for the U.S. to both act on its own and put
pressure on the rest of the Quartet and moderate Arab states to take
every possible measure to persuade the Palestinians to reject terrorism
and on the Israelis to both evacuate the Gaza, and roll back the
settlements the West Bank that extend beyond ``Greater Jerusalem'' and
security adjustments to the 1967 boundaries.
This means the kind of compromise that President Clinton proposed
at Camp David and that was discussed at Taba. Adjustments involving
some 3% of the area of the West Bank, not the 10-20% included in some
maps of the Israeli security barrier or the 30-40% some times proposed
by hard-line settlers. At the same time, 35 years of facts on the
ground are facts on the ground. The worlds of 1949 and 1967 are gone
forever, and peace must be based upon this reality.
The challenge is to persuade Israel to make as many compromises as
possible, and to find ways to compensate the Palestinians. The time has
come to look beyond the narrow terms of a settlement and see what a
massive aid program could do to guarantee a future Palestinian state's
economic and political success, and give the Palestinians living
standards that could underpin a peace. More ambitiously, it is to look
at how Jordan, Israel, and a Palestinian state could cooperate to live
in peace.
Boundaries are the past. With the exception of the holy places, the
focus should be economics, demographics, living standards, and security
in the broadest sense. This may well require a Western and Arab
economic aid program totaling billions of dollars over a period of
years. It will certainly require a continuing U.S. aid program to
Israel as well.
Moreover, it requires Palestinians and Arab governments to look
honestly at the demographics of Gaza and the West Bank, and to
understand that it is going to be an incredible challenge to deal with
the inherent population growth in both areas.
Gaza only had less than 245,000 people in 1949, and around 330,000
in 1967. The CIA estimates it now has more than 1.3 million, a growth
rate of more than 3.8%, and 49% of its population is 14 years of age or
younger. The U.S. Census Bureau estimates that it will grow to 1.7
million by 2010, and 4.2 million by 2050.
The West Bank had 775,000 people in 1949, and around 680,000 at the
end of the 1967 war. The CIA estimates it now has more than 2.3
million, a population growth rate of more than 3.2%, and 44% of its
population is 14 years of age or younger. The U.S. Census Bureau
estimates that it will grow to 2.8 million by 2010, and 5.6 million by
2050.
Far too many generations of young Palestinians have already been
wasted in conflict. If the generation that now exists and the
generations to come are to have hope, then the Palestinian refugees
outside Gaza and West Bank--nearly 90% of whom have never seen what
will be ``Palestine,'' must be made full citizens of the countries
where they now reside as refugees.

Rebuild U.S. ties to friendly Gulf States like Saudi Arabia and
Strengthen ties to all of the GCC states, Emphasizing
Cooperation in Dealing with Terrorism and Islamic Extremism
The U.S. needs to take broad steps to encourage evolutionary
political, economic, and demographic reform in the region, and to
recast its approach to counterterrorism to take more consideration of
its political impact. Both steps are discussed later in this report. In
the short term, however, the U.S. needs to prepare now to strengthen
its security ties to every friendly state in the Gulf, and to key
neighboring states like Egypt and Jordan.
The security posture of Saudi Arabia and every other Gulf
Cooperation Council (GCC) state is undergoing major changes. They no
longer face a major near to mid-term threat from Iraqi military forces,
but must deal with instability in Iraq and the growing risk that Iran
will become a nuclear power. This confronts Saudi Arabia and its
neighbors with hard strategic choices as to whether to ignore Iran's
efforts to proliferate, seek U.S. military assistance in deterring Iran
and possibly in some form of missile defense, or to acquire more modern
missiles and its own weapons of mass destruction.
The most urgent security threats to the Southern Gulf states,
however, no longer consist of hostile military forces. They have become
the threat of Islamic extremism and terrorism. Since May 2003, Saudi
Arabia has faced an active internal and external threat from Islamic
extremists, many affiliated with Al Qaida or exile groups, and it must
pay far more attention to internal security than in the past. At the
same time, the Saudi government must deal with the fact that this
threat not only is internal, but also is regional and extends
throughout the Islamic world. Saudi Arabia's religious legitimacy is
being challenged, and its neighbors and allies face threats of their
own.
Bahrain, Kuwait, and Oman faces Islamist security threats at a
lower level, but must also mix reform with improved internal security.
The UAE has some Islamist elements, and Qatar has essentially chosen to
buy time by mixing U.S. basing and reform with the tolerance of
Islamist extremists as long as they do not act within Qatar.
Saudi Arabia, in particular, must make major adjustments in its
alliances. The events of ``9/11,'' the backlash from the Israeli-
Palestinian conflict, differences over how to deal with terrorism, and
differences over the Iraq War have all combined to complicate Saudi
Arabia's security relations with the U.S., and to force it to distance
itself from the U.S. in some ways. At the same time, the Al Qaida
terrorist attacks on Saudi Arabia in May 2003 made it brutally clear
that Saudi Arabia was a full participant in the war on Islamic
terrorism and had even stronger incentives to cooperate with the U.S.
in anti-terrorism. Similarly, Saudi Arabia has not found any substitute
for U.S. power projection capabilities in dealing with Iran,
instability in Iraq, or Yemen, and needs U.S. technical assistance to
deal with massive and continuing deliveries of U.S. military equipment.
The other Gulf states face somewhat similar problems, and the past
failure to create an effective regional security structure has made
their problems worse. The Gulf Cooperation Council has made some
advances in military cooperation and internal security, but remains
largely a hollow shell. There is no true integration of security
efforts and only symbolic progress towards collective security.
Interoperability remains poor at every level, and there is little
progress towards effective power projection and sustainability.
There is little meaningful progress towards the creation of the
kinds of information technology, C41 (Command, Control, Communications,
Computers, and Intelligence), IS&R (Intelligence, Surveillance, and
Reconnaissance, and net-centric systems) that could tie together the
forces of the GCC, as well as make Saudi cooperation with U.S. forces
far more effective. At the same time, petty rivalries continue to
divide the Southern Gulf states, and Saudi Arabia face serious problems
in dealing with Yemen and in obtaining Yemeni cooperation in blocking
the infiltration of terrorists and the smuggling of arms and narcotics.
All of these factors interact with a longer-term set of threats to
the stability of every Gulf State that are largely economic and
demographic, but which may ultimately be more important than outside
military threats and the threat of Islamic extremism and terrorism.
Recasting military plans and improved internal security efforts must be
coupled to political, economic, and demographic reform.
Saudi Arabia, for example has embarked on a process of political,
economic, and social reforms that reflect a growing understanding by
the governing members of the royal family, Saudi technocrats, and Saudi
businessmen that Saudi ``oil wealth'' is steadily declining in relative
terms, and that Saudi Arabia must reform and diversify its economy to
create vast numbers of new jobs for its young and growing population.
These efforts so far are still faltering and have failed to gather the
necessary momentum, but their success is at least as essential as any
change in Saudi Arabia's security structure.
Every Gulf state must find ways to combine economic reform with
political and social reform to remain stable in the face of change, and
every state must be far more careful about the ways in which it uses
the revenues from its oil exports and its other revenues. This means
hard decisions about future arms imports and investments in military
and security forces. Massive changes are needed in military planning,
and especially in military procurement and arms imports, to create
balanced and effective forces at far lower cost.
As yet, Gulf states have only begun to react to these changes.
Their military and internal security forces are only beginning to adapt
to the fact the Iraqi threat has largely disappeared, that Iran's
threat is a mix of proliferation and capabilities for asymmetric
warfare and not the build-up of conventional forces, and that they are
engaged in a generational struggle against domestic and foreign Islamic
extremism. They have only begun the process of deeper political,
economic, and social reform; their plans are still half formed, and no
aspect of reform as yet has the momentum necessary to succeed.
Even if the U.S. succeeds in Iraq, it needs to work with every Gulf
state to help them make the necessary changes in their respective
security structures. It also needs to move decisively and openly away
from an emphasis on arms sales and U.S. basing and deployments to
encouraging effective security cooperation, strengthening the right
kind of internal security efforts, creating more cost-effective
military forces, and slowing down arms imports to fund higher priority
needs. The U.S. also needs to emphasize that its presence in the Gulf
will be tailored to meet local and not just U.S. security needs, that
the size of its forward posture will be tailored to the threat, and
that it is seeking military partnership and interoperability. The U.S.
also needs to lay the groundwork now for reshaping its military posture
in the Gulf when it withdraws its forces from Iraq and leaves all of
its bases in that country.
If the U.S. fails in Iraq, this will create an even stronger
incentive to have the strongest possible ties to the Southern Gulf
States. Saudi Arabia remains the key to any coordinated effort--just as
it remains the key to including Iraq in some broader regional security
concept. This does not mean seeking a return to the direct basing of
the pre-Iraq War era, or trying to create some form of U.S. pillar. It
does mean rebuilding ties with Saudi Arabia focused in counterterrorism
and energy interdependence. At the same time, the U.S. needs to
strengthen its ties to Bahrain, Kuwait, Oman, and the UAE, as well as
work as closely as possible with Yemen.
The U.S. should quietly develop a clear strategy and action plan
for discussing such future cooperation with each country that will lay
the groundwork for action if the U.S. is forced to withdraw from Iraq,
and prepare aid efforts and incentives for cooperation in adjusting to
this contingency. The same is true in preparing for the impact of any
U.S. withdrawal on Jordan and Egypt.
As a side issue, the U.S. needs to be far more careful about
talking about NATO initiatives in the region. To date, far too many of
the discussions of this issue have focused on what NATO wants without
any discussion of how this is going to benefit the Gulf states in terms
of security, interoperability, and better arms sales policies. There is
no evidence that NATO or European countries will actually provide more
military capability, or seriously ease the burden on U.S. force
deployments. There is a very real risk that another ``talk shop'' will
be layered over the existing problems in Gulf security structures. U.S.
efforts focused on getting NATO forces for Iraq that the U.S. clearly
is not going to get now seem more likely to end in counterproductive
tokenism than anything else.

Adopt a More Flexible Policy in Dealing with Iran
The U.S., the West, and Gulf states cannot afford to ignore either
the military realities in Iran, or the risk it will pose to Iraq
whether the U.S. fails or succeeds. At one level, there is a clear case
for the U.S. to encourage its Gulf and other allies to try to halt or
limit Iranian proliferation and for the U.S. to work with Gulf states
to create an effective level of military containment, deterrence, and
defense. At another level, the U.S. will need to work with Iran to make
it clear that there are good options for negotiation and improving
relations, and options for cooperation in dealing with Iraq that will
be to the advantage of Iran, Iraq, and the U.S.
Iran is the only military power that poses a direct threat in terms
of conventional military forces and proliferation. The disclosures made
by the IAEA over the last year indicate that it is nearly certain that
Iran will continue to covertly seek nuclear weapons, regardless of what
it claims to agree to. It is developing long-range missiles, it has
never properly declared its holdings of chemical weapons, and the
status of its biological weapons programs is unknown.
Moreover, the disclosures that have come out of Libya's decision to
end its nuclear program indicate that Iran may well have one Chinese
fission weapons design, with a 1,000-pound payload, and all of the
technology necessary to make high capacity P2 centrifuges. This would
eliminate the need for many aspects of nuclear weapons testing, as well
as make it far easier to create small, dispersed trains of covert
centrifuge facilities.
Iran is still a significant conventional power. It has some 520,000
men under arms, and over 300,000 reserves. These include 125,000
Iranian Revolutionary Guards trained for land and naval asymmetric
warfare. Iran's military also includes holdings of some 1,600 main
battle tanks, 1,500 other armored fighting vehicles, 3,200 artillery
weapons, 300 combat aircraft, 50 attack helicopters, 3 submarines, 59
surface combatants, and 9 amphibious ships.
Iran is a potential threat to Gulf shipping as well as to shipping
in the Gulf of Oman. It occupies islands near the main shipping
channels in the Gulf and has close contacts with outside terrorist
movements. At the same time, virtually all of Iran's military equipment
is aging or second rate and much of it is worn. It has not been able to
modernize its air forces, ground based air defenses, or develop major
amphibious warfare capabilities. Iran lost some 50-60% of its land
order of battle in the climatic battles of the Iran-Iraq War, and has
not imported a cutting edge weapon system since that time, or created
advanced new C41 systems.
According to U.S. intelligence estimates, Iran imported $2.0
billion worth of arms during 1996-1999, and $600 million from 2000-
2003. Iran only signed $1,700 million worth of new arms agreements
during 1996-1999, and only $500 million in new arms agreements during
2000-2003.\20\ This is roughly 30% to 35% of the level necessary to
recapitalize and modernize its forces. Though Iran may be able to
compensate in part through its domestic military production, its
current weapons developments are scarcely advanced enough to solve its
problems. As a result, it must either succeed in proliferation or rely
heavily on asymmetric warfare.\20\
Iran has declared it has the capacity to make chemical weapons. The
details of its biological warfare efforts are unknown but it continues
to import suspect biotechnology. It is also moving forward in the
nuclear dimension. The IAEA has discovered a number of disturbing
details about its uranium enrichment program that are very similar to
Libya's nuclear weapons program, including the ability to produce P-2
centrifuges. Iran has conducted experiments with Uranium Hexafluoride
that could fuel a weapons-oriented enrichment program, and has worked
on a heavy water plant that could be used in a reactor design that
would produce fissile material far more efficiently than its Russian
supplied light water reactor. While it is not yet confirmed, Iran may
well have received the same older Chinese design data for a 1,000-2,000
pound nuclear weapon that Libya acquired through Pakistani sources.
The report by the Director General of the IAEA, dated September 1,
2004, states that Iran continues its nuclear development program, has a
design for P-2 centrifuge, and that there has been low and highly
enriched uranium contamination in Iranian nuclear sites.\22\ The Board
of Governors met on September 13, 2004, they are divided over what to
do with Iran, and they are likely to postpone their decision until
their November meeting.
There is also evidence that Pakistan might have helped Iran in its
enrichment program. The Agency argues that Pakistan has helped Iran
since 1995, and that the Pakistanis delivered the P-2 design to the
Iranians. IAEA goes on to claim that Iran is intending to ``turn 37
tons of nearly raw uranium called yellowcake, into uranium
hexafluoride.'' Experts contend that this could be enough to create 5-6
atomic weapons.\23\
It is doubtful that Iran will really fully comply with the NNPT,
and it seems more likely that it is only a matter of time before Iran
acquires nuclear weapons. It's, however, very unclear what kind of a
nuclear power Iran will be. No plans have ever surfaced as to the
number and type of weapons it is seeking to produce or the nature of
its delivery forces. Nothing meaningful is known about Iranian nuclear
doctrine and targeting, or plans to limit the vulnerability of its
weapons and facilities--and whether these could include a launch-on-
warning or launch-under-attack capability.
Iran might be content to simply develop its technology to the point
it could rapidly build a nuclear weapon. It might choose to create an
undeclared deterrent, limit its weapons numbers and avoid a nuclear
test. It might test and create a stockpile, but not openly deploy
nuclear-armed missiles or aircraft. It also, however, might create an
overt nuclear force. Each option would lead to a different Saudi
response, as well as provoke different responses from Israel and the
U.S., creating different kinds of arms races, patterns of deterrence,
and risks in the process.
Delivery systems are also a problem. Iran is reaching final
development of its Shahab-3 missile, and working on a longer-range
version of the missile as well as the Shahab-4, and Shahab-5. These
missiles will be able to reach most Gulf cities and area targets, but
are far too inaccurate and lacking in total payload to be effective
conventional weapons. They are useful militarily only if they have
warheads carrying weapons of mass destruction. Moreover, Gulf states
face the risk of some form of covert attack or the possibility of the
transfer of weapons to some anti-Saudi extremist group or proxy. These
currently do not seem to be probable scenarios, but they are possible.
Much will depend on whether Iran feels it faces a threat of attack
or preemption if it openly deploys nuclear forces, and on its
perception of the level of cooperation between the U.S. and the
Southern Gulf states in creating effective defenses and deterrence.
Iran will never be a regional ``superpower,'' but it may well become
dangerous if any power vacuum or lack of resolve emerges in the region.
It will certainly exploit any gap between U.S. policies and efforts and
those of other Gulf states, as well as any opportunities offered by
states outside the region.
Much will also depend on how Iran perceives its options in dealing
with the U.S. over both its overall security position and Iraq. The
U.S. needs to offer carrots as well as sticks. It needs to make it
clear to Iran that the U.S. will not stay in Iraq or uses its position
there against Iran. It needs to stop talking about an ``axis of evil,''
and act from a stance of ``more in sorrow than in anger,'' calling for
cooperation and putting the onus on Iran's hardliners. It needs to
adopt a clear posture of being willing to engage in unrestricted
official dialog, and show it will engage Iran in any area where quiet
talks and mutual cooperation can help both nations. Afghanistan is an
example, and should have been a prelude to such cooperation over Iraq.
Above all, the U.S. needs to stop talking vaguely about Iran at the
``official spokesman'' level and making charges it does not
substantiate in detail. The U.S. needs to makes its concerns clear and
specific, and back them up. It needs to advance proposals, not just
problems. It needs to recognize Iranian concerns and show how
cooperation over Iraq and other issues could benefit Iran more than
confrontation. It also needs to think long and hard about how to
approach Iran in the case of either success or failure in Iraq. A
stable Iraq means a Shi'ite majority; a failed Iraq means a power
vacuum. Iran should be quietly told what U.S. policy is, and what its
options are, in both cases.

Prepare for the Potential Impact of Problems in Iraq in Dealing with
the Fighting in Afghanistan
It is time to need to think long and hard about the future of
Afghanistan, and what can actually be done about it--particularly if
the U.S. is forced to withdraw from Iraq. There already is a serious
risk that the legacy of the defeat of the Taliban is making Afghanistan
the ``poster child'' of politically correct and unobtainable goals.
This situation is difficult now, and could become explosive if the U.S.
is seen as being defeated in Iraq.
What is need is realism, and not good intentions. As is the case in
Iraq, it is plans that can be actually implemented. This requires
several existential questions to be dealt with that the U.S. (and
Europe) often seem determined to ignore:

What constitutes achievable success in nation building in
Afghanistan, and is it that much different from what the West
normally regards as failure?
How long and intensive should the fight to deal with the
remnants of the Taliban and Al Qaida go on? What kind of fight
is actually worthwhile? When do the problems in terms of
domestic hostility to Western intervention, for Pakistan, etc.
exceed the benefits?
Is a true central government really practical or necessary?
Is any kind of economy other than a drug economy actually
possible, and what does economic reform and development in
Afghanistan actually mean?
What can NATO really accomplish? As the Economist points out
(June 19, 2004), NATO and Western international efforts to date
are not a success story: Many pledges in aid and in providing
police and security forces have not been kept.
NATO only now has 6,500 men in the ISAF, and most have such
light equipment they are undergunned compared to some warlords.
They currently only function in Kabul and have a limited
presence in Kunduz. Adding some 3,500 men more, as a result of
the NATO summit of June 2004, will fall far short of the 5,000
President Karzai requested as a minimum. Only 1,500 of the
personnel will evidently actually be deployed to Afghanistan,
including one battalion of 700 men. (2,000 more of the 3,500
will be a ready reserve, including two more battalions). Those
deployed will provide token Europe support for the PRTs planned
for Faizabad, Maimana, Baghian, and Mazar-I-Sharif, but not
deal with the Pushtun issue.\24\
What can be done to make aid more real and more effective?
What can be done to convert non-U.S. pledges into actual aid
deliveries (only about $386 million of a total of only $1,24
billion in such pledges had actually been provided as of June
2004, versus $1.4 billion out of U.S. pledges of $3.3 billion)?
Moreover, is actual aid needed and not loans? Do NGOs need new
fiscal monitoring and controls to examine how much money they
actually spend in country, as distinguished from overhead and
salaries?

Afghanistan does not have to be ``mission impossible,'' but the
U.S. and Europe must focus on ``mission practical'' to make real
progress. They also need to look far beyond democracy and politics, and
come to grips with governance, economic, demographics, and the hard
realities on the ground.
The U.S. also needs clear contingency plans for having to leave
Iraq under any conditions that the region will perceive as defeat. This
may well mean moving some elements of U.S. forces eastward, rather than
to the Gulf, or bring them home. The U.S. will need to take tangible
action in Afghanistan to show that a local reversal is not a regional
defeat, and that the U.S. will act to strengthen both Afghanistan and
Pakistan.
This does not, however, mean expanding its role in Central Asia.
That role is already conspicuously tied to dictators and failed
regional leaders, and the U.S. needs to be far more careful about the
extent to which it becomes coupled to such regimes in local eyes. ``The
enemy of my enemy is my friend'' is a proverb that requires far more
judgment and restraint.
Recast U.S. Energy Policy to Deal with the Reality that the U.S. Will
Have Growing Strategic Dependence on Gulf and Middle Eastern
Oil Exports for the Next 20 years, and Their Security will
Become Steadily More Important
The election campaign is over and it is time for both parties, and
the Administration and the Congress, to be honest about energy. The
U.S. can and must find substitutes for petroleum, but this will take
decades. In the interim, the U.S. and the global economy will actually
become steadily more dependent on energy imports, and particularly on
energy imports from the Gulf. The Department of Energy estimates that
oil will account for some 39% of the world's energy consumption through
2015, and that the U.S. and its major trading partners in developing
Asia will account for 60% of the increase in world demand through this
period.\25\
The MENA region has some 63% of all of the world's proven oil
resources, and some 37% of its gas. In 2001, the Gulf alone had over
28% of all of the world's oil production capacity, and the entire MENA
region had 34%.\26\ These reserves, and low incremental production
costs, ensure the region will dominate increases in oil production
through at least 2015. The EIA estimates that Saudi Arabia alone will
account for 4.2 MMBD of the total increase, Iraq for 1.6 MMBD. Kuwait
for 1.3 MMBD, and the UAE for 1.2 MMBD. These four countries account
for 8.3 MMBD out of a worldwide total of 17.9 (46%). To put these
figures in perspective, Russia will account for an increase of only 1.3
MMBD.\27\
The International Energy Agency estimates cover a longer period
than the EIA estimates. They predict that total conventional and non-
conventional oil production will increase from 77 MMBD in 2002 to 121.3
MMBD in 2030. This is a total increase of 44.3 MMBD worldwide. The
Middle East will account for 30.7 MMBD, or 69% of this total. The IEA
also estimates that the rate of dependence on the Middle East will
increase steadily after 2010 as other fields are depleted in areas
where new resources cannot be brought on line. It estimates that 29
MMBD, or 94% of the total 31 MMBD increase in OPEC production between
2010 and 2030 will come from Middle Eastern members of OPEC.\28\
This dependence will be easier to secure with a friendly and stable
Iraq, but the U.S. has no choice. The U.S. Energy Information Agency
(EIA) summarizes the trends in Gulf oil exports as follows in its
International Energy Outlook for 2004, and it should be noted that its
estimates are based on favorable assumptions about increases in other
fuels like gas, coal, nuclear and renewables, and favorable assumptions
about increases in conversion and energy efficiency: \29\

In 2001, industrialized countries imported 16.1 million
barrels of oil per day from OPEC producers . . . Of that total,
9.7 million barrels per day came from the Persian Gulf region.
Oil movements to industrialized countries represented almost 65
percent of the total petroleum exported by OPEC member nations
and almost 58 percent of all Persian Gulf exports.\30\
By the end of the forecast period (2025), OPEC exports to
industrialized countries are estimated to be about 11.5 million
barrels per day higher than their 2001 level, and more than
half the increase is expected to come from the Persian Gulf
region.\31\
Despite such a substantial increase, the share of total
petroleum exports that goes to the industrialized nations in
2025 is projected to be almost 9 percent below their 2001
share, and the share of Persian Gulf exports going to the
industrialized nations is projected to fall by about 13
percent. The significant shift expected in the balance of OPEC
export shares between the industrialized and developing nations
is a direct result of the economic growth anticipated for the
developing nations of the world, especially those of Asia.
OPEC petroleum exports to developing countries are expected
to increase by more than 18.0 million barrels per day over the
forecast period, with three-fourths of the increase going to
the developing countries of Asia. China, alone, is likely to
import about 6.6 million barrels per day from OPEC by 2025,
virtually all of which is expected to come from Persian Gulf
producers.
North America's petroleum imports from the Persian Gulf are
expected to double over the forecast period. At the same time,
more than one-half of total North American imports in 2025 are
expected to be from Atlantic Basin producers and refiners, with
significant increases expected in crude oil imports anticipated
from Latin American producers, including Venezuela, Brazil,
Colombia, and Mexico. West African producers, including Nigeria
and Angola, are also expected to increase their export volumes
to North America. Caribbean Basin refiners are expected to
account for most of the increase in North American imports of
refined products. With a moderate decline in North Sea
production, Western Europe is expected to import increasing
amounts from Persian Gulf producers and from OPEC member
nations in both northern and western Africa. Substantial
imports from the Caspian Basin are also expected.
Industrialized Asian nations are expected to increase their
already heavy dependence on Persian Gulf oil. The developing
countries of the Pacific Rim are expected to almost double
their total petroleum imports between 2001 and 2025.

While quantified estimates of export dependence are uncertain, its
clear that it would take a massive breakthrough(s) in technology or
discoveries of reserves outside the Middle East and North Africa (MENA)
to change these trends.
Moreover, both the military security of the MENA region, and its
ability to achieve the necessary investment in new energy production
are critical U.S. strategic interests. For example, some 40% of all
world oil exports now pass daily through the Strait of Hormuz and both
EIA and IEA projections indicate this total will increase to around 60%
by 2025-2030.\32\
The IEA projections, for example, indicate that Middle Eastern
Exports will total some 46 MMBD by 2030, and represent more that two-
thirds of the world total. This means that the daily traffic in oil
tankers will increase from 15 MMBD and 44% of global interregional
trade in 2002, to 43 MMBD and 66% of global interregional trade in
2030. This means that the daily traffic in LNG carriers will increase
from 28 BCM and 18% of global interregional trade in 2002, to 230
carriers and 34% of global interregional trade in 2030.\33\ The IEA
does, however, estimate that these increases would be some 11% lower if
oil prices remained consistently high in constant dollars.
The International Energy Agency also estimates that imports will
rise from 63% of total OECD demand for oil in 2002 to 85% in 2030 some
$3 trillion dollars must be invested in the oil sector from 2003 to
2030 to meet world demand for oil, and something approaching half of
this total must be invested in the Middle East. Some $234 billion will
be required for tankers and oil pipelines, and again, a substantial
amount must go to the MENA area.\34\
Under most conditions, the normal day-to-day destination of MENA
oil exports is strategically irrelevant. Oil is a global commodity,
which is distributed to meet the needs of a global market based on
process bid by importers acting in global competition. With the
exception of differences in price because of crude type and
transportation costs, all buyers compete equally for the global supply
of available exports, and the direction and flow of exports changes
according to marginal price relative to demand. As a result, the
percentage of oil that flows from the MENA region to the United States
under normal market conditions has little strategic or economic
importance. If a crisis occurs, or drastic changes take place in
prices, and the U.S. will have to pay the same globally determined
price as any other nation, and the source of U.S. imports will change
accordingly. Moreover, the U.S. is required to share all imports with
other OECD countries in a crisis under the monitoring of the
International Energy Agency.
The size of direct imports of petroleum is also only a partial
measure of strategic dependence. The U.S. economy is dependent on
energy-intensive imports from Asia and other regions, and what comes
around must literally go around. While the EIA and IEA do not make
estimates of indirect imports of Middle Eastern oil in terms of the
energy required to produce the finished goods, the U.S. imports them
from countries that are dependent on Middle Eastern exports, analysts
guess that they would add at least 1 MMBD to total U.S. oil imports. To
put this figure in perspective, direct U.S. oil imports increased from
an annual average of 7.9 MMBD in 1992 to 11.3 MMBD in 2002, and 2.6
MMBD worth of U.S. petroleum imports came directly from the Middle East
in 2002.\35\ If indirect U.S. imports, in the form of manufactured
goods dependent on imports of Middle Eastern oil were included, the
resulting figure might well be 30-40% higher than the figure for direct
imports.
Moreover, the U.S. and other industrialized states are increasingly
dependent on the health of the global economy. With the exception of
Latin America, Mexico, and Canada, all of America's major trading
partners are critically dependent on Middle Eastern oil exports. In
2002, the Middle East and North Africa supplied 5.0 MMBD of 11.9 MMBD
of European imports (42%). MENA exporters supplied 4.0 MMBD of Japanese
imports of 5.1 MMBD (79%). While MENA countries supplied 0.8 MMBD out
of China's imports of 2.0 MMBD (39% and growing steadily in recent
years), 0.2 MMBD of Australia's imports of 0.6 MMBD (33%), and 6.5 MMBD
of some 8.6 MMBD in imports by other Asian and Pacific states
(76%).\36\
The EIA and IEA project that the global economy will also grow far
more dependent on the Middle East and North Africa in the future. The
EIA's International Energy Outlook 2004 projects that North American
imports of MENA oil will increase from 3.3 MMBD in 2001 to 6.3 MMBD in
2025--an increase of 91%, almost all of which will go to the U.S. The
increase in exports to Western Europe will be from 4.7 MMBD to 7.6
MMBD, an increase of 62%. This assumes major increases in oil exports
from the FSU and conservation will limit the scale of European imports
from the Middle East. Industrialized Asia--driven by Japan--will
increase its imports from 4.1 MMBD to 6.0 MMBD, or nearly 50%. China
will increase its imports from 0.9 MMBD to 6.0 MMBD, or by nearly 570%;
and Pacific Rim states will increase imports from 5.0 MMBD to 10.2
MMBD, or by 104%.
U.S. oil imports are only a subset of U.S. strategic dependence on
Middle East oil exports. It is important to note, however, that neither
the Bush energy policy, nor any recent Congressional energy bills, are
projected to have any meaningful strategic impact on U.S. import
dependence if they are ever passed into law and transformed into
action. It takes massive shifts in U.S. energy consumption and supply
over extended periods of time to accomplish this and there are good
reasons that the Bush Administration, Kerry energy policy, and
Congressional advocates of different policies have either failed to
make meaningful analysis of the impact of their proposals on U.S.
import dependence or have provided ``blue sky'' estimates that are
little more than political posturing.
If one turns to the EIA estimates made since the Bush
Administration came to office, it is clear that realistic models of
U.S. energy needs will lead to steady increases in U.S. energy imports.
The EIA's 2003 Annual Energy Forecast reports that net imports of
petroleum accounted for 55 percent of domestic petroleum consumption in
2001. U.S. dependence on petroleum imports is projected to reach 68% in
2025 in the reference case. This is a rise in U.S. net imports from
10.9 MMBD in 2021 to 19.8 MMBD in the reference case (+82%). In the low
oil price case, net imports would rise to 21.1 MMBD. They would be 18.2
MMBD in the high oil price case, 17.8 MMBD in the low economic growth
case, and 22.3 MMBD in the high economic growth case.\37\
The EIA's annual U.S. energy forecast for 2004 predicts that
imports will be even higher. It reports that net imports of petroleum
accounted 53 percent of domestic petroleum consumption in 2002. U.S.
dependence on petroleum imports is estimated to reach 70 percent in
2025 in the reference case, versus 68 percent in the 2003 forecast.
Imports are expected to be 65 percent of total consumption. In the low
oil price case this number is estimated to be 75 percent.\38\ (The
AEO2003 report indicated that estimated imports as a share of total oil
consumption would be 65 percent in high price case in 2025, and 70
percent in the low price case.)
The specific figures will vary according to oil price s and the
growth of the U.S. economy, and the EIA contingency forecasts are
summarized below in millions of barrels per day: \39\

------------------------------------------------------------------------
Net
Year and projection Product Net Net crude product
supplied imports imports imports
------------------------------------------------------------------------
2002........................ 19.8 10.5 9.1 1.4
2025:
Reference............... 28.3 19.7 15.7 3.9
Low oil price........... 31.1 23.3 18.2 5.1
High oil price.......... 25.6 16.6 14.3 2.2
Low Growth.............. 25.9 17.6 15.0 2.6
High Growth............. 30.6 21.8 16.4 5.4
------------------------------------------------------------------------

In 2002, net U.S. imports of petroleum accounted for 53 percent of
domestic petroleum consumption. Increasing dependence on petroleum
imports is projected, reaching 70 percent in 2025 in the reference
case. The corresponding import shares of total consumption in 2025 are
expected to be 65 percent in the high oil price case and 75 percent in
the low oil price case.
In short, the practical problem for the foreseeable future is how
to ensure that the MENA states can obtain the more than $1 trillion the
International Energy Agency estimates they will need to expand energy
production capacity and exports, and to protect growing U.S. and global
dependence on MENA energy exports, particularly from the Gulf. There
are no meaningful near and mid-term options that will allow the U.S. to
reduce dependence in any meaningful strategic sense at anything like
today's market prices for energy. The U.S. must shape its security
policies accordingly, regardless of what happens in Iraq. It must also
shape them in light of U.S. dependence on a global economy--not simply
direct U.S. dependence on oil imports.

Encourage Evolutionary Political, Economic, Demographic, and Social
Reform
The U.S. cannot secure its narrow strategic interests in the Middle
East unless it also seeks far broader strategic goals that will meet
the needs of its peoples as well as those of the United States. The
battle for hearts and minds extends far beyond Iraq, and the West and
the Middle East, particularly the U.S. and Arab world, need to take a
more honest approach to reform.
So far, governments have reacted largely by treating the symptoms
and not the disease. Counterterrorism is essential to deal with the
most obvious and damaging symptoms, but it cannot deal with the
underlying causes. Military force is sometimes necessary. However, it
is now all too clear in Iraq that it can create as many--or more--
problems than it solves.
The practical results are all too clear from an August 2004 survey
by the Pew Research Center, and one that clearly shows how the
divisions between the West and Middle East affect moderate and
traditionally friendly states. The Pew group reported, ``In the
predominantly Muslim countries surveyed, anger toward the United States
remains pervasive . . . Osama bin Laden is viewed favorably by large
percentages in Pakistan (65%), Jordan (55%) and Morocco (45%). Even in
Turkey, where bin Laden is highly unpopular, as many as 31% say that
suicide attacks against Americans and other Westerners are justifiable.
There are many other surveys that deliver the same message, just as
there are many surveys of U.S. and Western opinion that reflect anger
against terrorism, and hostility towards Islam and the Arab world. The
events of 9/11, the rise of Islamic extremism and the faltering Western
reaction, the broad regional backlash to the Arab-Israeli conflict, the
Iraq War, and the growing clash between religions and cultures, have
all led to a crisis in relations that governments cannot address in
such conventional terms.
U.S. and Arab relations are where they are today for many reasons,
but one of them is that the Western and Islamic worlds have previously
defined ``tolerance'' in terms of mutual ignorance, and in terms of
governmental indifference at the ideological, political, and cultural
level.
Empty U.S. calls for instant, region-wide democracy and political
reform are producing a dangerous counterreaction in much of the Arab
world. A Western focus on counterterrorism--without a balancing focus
on creating bridges between the West and Middle East--is often breeding
extremism rather than defeating it.
At the same time, token pledges and efforts at reform within the
Arab world fall far short of the needs of Arab peoples, and are weak
and ineffective counters to extremism. Neither Middle Eastern
governments nor Middle Eastern intellectuals have yet shown they can
honestly address the scale of the region's problems or act decisively
at the speed and depth required.
These efforts cannot deal with problems that are ``generational''
in nature. They are not the product of one temporary series of
conflicts and tensions, or of the threat posed by today's groups of
terrorists and extremists. Weak regimes, population growth,
demographic, hyperurbanization, and a failure to develop and diversify
regional economies all act to create pressures on the Middle East that
will outlive Bin Laden and Al Qaida by decades.
Most of the nations of the Arab and Islamic world now face
pressures and changes that they can only deal with if they come firmly
to grips with the need for reform:

Failed secular regimes and political parties have pushed the
peoples of the region back towards Islam and made them seek to
redefine the role of religion in their lives.
Massive population increases: The Middle East and North
Africa had a population of 112 million in 1950. The population
is well over 415 million today, and approaching a fourfold
increase. It will more than double again, to at least 833
million, by 2050.
A ``youth explosion,'' where ages 20-24--the key age group
entering the job market and political society--has grown
steadily from 10 million in 1950 to 36 million today, and will
grow steadily to at least 56 million by 2050.
Some 36% of the total MENA population is under 15 years of
age versus 21% in the U.S. and 16% in the EU. The ratio of
dependents to each working age man and woman is three times
that in a developed region like the EU.
A failure to achieve global competitiveness, diversify
economies, and create jobs that is only partially disguised by
the present boom in oil revenues. Direct and disguised
unemployment range from 12-20% in many countries, and the World
Bank projects the labor force as growing by at least 3% per
year for the next decade.
A region-wide average per capita income of around $2,200
versus $26,000 in the high-income countries in the West.
A steady decline in non-petroleum exports as a percentage of
world trade over a period of nearly half a century, and an
equal pattern of decline in regional GDP as a share of global
GDP.
Hyperurbanization and a half-century decline in agricultural
and traditional trades impose high levels of stress on
traditional social safety nets and extended families. The urban
population seems to have been under 15 million in 1950. It has
since more than doubled from 84 million in 1980 to 173 million
today, and some 25% of the population will soon live in cities
of one million or more.
Broad problems in integrating women effectively and
productively into the work force. Female employment in the MENA
region has grown from 24% of the labor in 1980 to 28% today,
but that total is 15% lower than in a high growth area like
East Asia.
Growing pressures on young men and women in the Middle East
and North Africa to immigrate to Europe and the U.S. to find
jobs and economic opportunities that inevitably create new
tensions and adjustment problems.
Almost all nations in the region have nations outside the
region as their major trading partners, and increased
intraregional trade offers little or no comparative advantage.
Much of the region cannot afford to provide more water for
agriculture at market prices, and in the face of human demand;
much has become a ``permanent'' food importer. Regional
manufacturers and light industry have grown steadily in volume,
but not in global competitiveness.
Global and regional satellite communications, the Internet,
and other media, have shattered censorship and extremists
readily exploit these tools.
A failed or inadequate growth in every aspect of
infrastructure, and in key areas like housing and education.
Growing internal security problems that often are far more
serious than the external threat that terrorism and extremism
pose to the West.
A failure to modernize conventional military forces and to
recapitalize them. This failure is forcing regional states to
radically reshape their security structures, and is pushing
some toward proliferation.
Strong pressures for young men and women to immigrate to
Europe and the U.S. to find jobs and economic opportunities
that inevitably create new tensions and adjustment problems.

Unlike today's crises and conflicts, these forces are so great that
they will play out over decades. They cannot be dealt with simply by
attacking today's terrorists and extremists; they cannot be dealt with
by pretending religion is not an issue, and that tolerance can be based
on indifference or ignorance.
Today, both sides take a dysfunctional approach to reform. The Arab
world tends to live in a state of denial about both the scale of its
need for reform, and the ineffectiveness of most of its present
efforts. Arab governments and Arab intellectuals have generally failed
their peoples. They promise, plan, and talk but falter in taking
meaningful action. The end result is that the failure of evolution
breeds revolution, and the failure of moderates breeds extremists.
Far too many of these failures also transcend culture and religion.
A failed state sector is a failed state sector. Policies that block
economic growth block economic growth. Bad education is bad education,
and rote learning is rote learning. A development plan that is never
really implemented cannot lead to development. Slow progress in the
rule of law and basic human rights is simply too slow to be acceptable.
A virtual conspiracy of silence on the subject of population growth and
demographics amounts to intellectual cowardice.
There is no question that much in the U.S. and the West also
deserves criticism. The answer, however, is not to stifle criticism,
but rather to encourage mutual criticism and common pressure for reform
and change. Moreover, the problems involved are relative; the Arab
world and Middle East simply are moving too slowly, making far too many
excuses, and exporting a great deal of the problems that can only be
solved through action at home.
Blaming the West, ``globalism,'' the U.S., and a colonial heritage,
are all further forms of moral and intellectual cowardice. At least 90%
of the problems of Arab states and Middle Eastern governments are self-
inflicted wounds. They will only be solved when individual Arab
countries have the courage and will to solve them on their own.
The other side of this coin, however, is that U.S. calls for
instant progress towards region-wide ``democracy'' and ``elections''--
the kind of vague generalities that called for the initial drafts of
the U.S. ``Greater Middle East Initiative''--only make things worse.
They treat all countries as the same, ignore the need for political
parties, experience with elections, and moderate opposition movements.
They also ignore the human rights, rule of law, economic, demographic,
educational, and social reforms that often have a higher priority and
are the precursors to meaningful pluralism. Far too often, the U.S. has
adopted a ``one man, one vote, one time'' approach to change in the
Middle East; and has ignored the need for evolution by its friends in
the search for a revolution that would bring extremists and its enemies
to power.
The vague generalities of the G8 communique that took the place of
the ``Greater Middle East Initiative'' were far less damaging, but also
provide no basis for real progress. They do not offer incentives in
terms of economic aid, accession to the WTO, better trade, or foreign
investment. They talk in meaningless terms about regional solutions and
intraregional cooperation.
A broad debate, indeed dialectic, is needed on reform in the Arab
world and Middle East. The primary force for this debate must come from
within, but it must be provoked, challenged, and aided from without. At
the same time, the U.S., EU, and all of the members of the G8 need to
move beyond both political mirror imaging and vacuous good intentions.
Calls for reform need to be evaluated, planned, and prioritized on
a country-by-country basis. They need to build on what countries, and
their reformers, are doing wherever possible. They need to find out the
best evolutionary path to human rights, rule of law, economic,
demographic, educational, and social reforms in a given country; and
provide real incentives not just criticism. They need to understand
that democracy without stability, and the proper checks and balances,
is simply a different form of extremism.

Give the Political Dimension of Counterterrorism a New Priority
The same pressure for reform are both an underlying cause of
terrorism and a reason why the U.S. must give the political dimension
of counterterrorism a new priority. The U.S., the West, and every
moderate state and movement in the Islamic world now face a common
threat in forms of Islamic extremism that cannot tolerate other
interpretations of Islam, much less Judaism and Christianity.
This threat is inevitably coupled to the threat posed by forms of
Christianity that see all non-Christians as damned, and Jews simply as
a convenient mechanism to trigger the second coming. It is coupled to
Israeli extremist statements that effectively dehumanize Palestinians
and reject the legitimacy of Islam, and statements in the Arab world
that go from anger against Israel to attacks on all Jews and Judaism.
The result to date has been a flood of mutually hostile press
reports, television coverage filled with conscious and unconscious
bias, and in movie villains that exploit, rather than counter,
prejudice. We see it in a series of public opinion polls that reflect a
growing polarization between broad sectors of the public, and again,
particularly in the U.S. and Arab world.
Most tangibly and dangerously, the practical result is terrorism
and violence; endless conspiracy theories, vicious stereotypes;
detentions; and growing barriers to travel and immigration. It is
reflected it in the breakdown of long-standing alliances, in the
growing bitterness and underlying hatred in the Arab-Israeli conflict;
in Afghanistan and Iraq in the form of religiously inspired insurgency
and asymmetric war; and in threats to acquire and use weapons of mass
destruction against those with different cultures and religions.
So far, the U.S. has responded by focusing on counterterrorism. In
the process, it has created growing barriers between it in the Arab
world, undermined past alliances, and focused on short-term expedience.
Many Arab regimes have acted in terms of denial, taken half measures,
and failed to address extremism. The end result of both approaches is
that the problem is growing, not diminishing. The problem is also that
extremist movements are developing new linkages and finding new ways to
exploit popular anger, emotion, and religious prejudice.
The U.S. needs to work with Arab and other Islamic regimes to take
a new approach to public policy that goes beyond the traditional
approach to strategy, and one that must have the active support of both
Western and Islamic governments. Governments--and particularly the U.S.
government and the moderate governments of the Arab world--need to make
a concerted effort to make religious and cultural tolerance a matter of
public policy. They need to support this effort in the ways they
structure education, diplomacy, law enforcement, immigration, and all
of the other tools available to the state.
What are some of the practical actions that the U.S., other
Western, and Arab and Islamic governments need to employ to bring
balance and depth to their actions, and to implement such a grand
strategy? The answers must be empirical, and many must be found on a
nation-by-nation and case-by-case basis. The best approach should be
the subject of an intense debate in both the West and at appropriate
points along the continuum of the Arab countries, the Middle East, and
the Islamic world. It is clear, however, what some of the answers must
be:

Western and Islamic governments must make enduring efforts
to bridge the gap between cultures and religions, and create a
common effort to move towards development and reform.
Governments need to fund dialogue and mutual exchanges at
the levels only governments can mount, and do so through a mix
of grants, public information campaigns, and governmental use
of all the tools available to influence domestic and foreign
public opinion.
The leaders of governments need to encourage the highest-
ranking religious leaders of the West and Islamic world to deal
as firmly with the divisions between Judaism, Christianity, and
Islam as the Vatican finally dealt with the divisions between
Judaism and Christianity.
Comprehensive educational reform is needed in both the
Middle East and the West to teach tolerance based on
understanding at every level from the earliest levels of
education through graduate education, and a systematic purging
of education material with prejudice, hate, or stereotypes.
Use should be made of all the legitimate tools of law to put
an end to extremist and hate-oriented literature and use of the
media.
Governments need to carry out a comprehensive review of visa
policies based on the understanding that encouraging legitimate
study abroad, media presence and visits, academic exchanges,
visits for dialogue and cultural familiarization, and
international business are as much a critical element in the
war on terrorism as defeating or interdicting terrorists.
An equally comprehensive review is needed of
counterterrorism policies that looks beyond a narrow focus on
defeating terrorists and seeks to ensure that necessary action
to defeat terrorism does not create unnecessary anger and
hostility, detain or arrest the innocent, or fail to compensate
those who are unfairly arrested.
Western policies towards immigration must emphasize
tolerance and equality for Arab and Islamic immigrants, not
just economic need and security.
Governments need to act to set common ground rules for
handling deportations and detainments that fully consider the
human rights and political aspects of such actions, and their
``backlash''.
A common effort to develop efficient means for reviewing
charitable and other fund transfers and activities so that
legitimate activity is not blocked by the effort to reduce the
funding of extremism and terrorism.
Creation of new mechanisms for security dialog between
groups like NATO and the GCC, and on a national basis, to ease
the pressure for arms sales, strengthen mutual security efforts
to deal with threats like proliferation and asymmetric warfare,
and create true security and arms control partnerships in
regions like the Gulf.

There is one other critical step the U.S. needs to take to deal
with terrorism and every other issue in the region. The U.S. needs
strong, well-funded, and proactive U.S. Embassy teams that can deal
with the needs and perceptions of each country in the region. It needs
to adequately fund public diplomacy at the national level, and tie
together its efforts at encouraging reform, building effective security
structures, and counterterrorism.
Effective national policies are not enough. The U.S. needs coherent
efforts tailored to the need of given countries, and to give the term
``country team'' real meaning. It needs to put an end to the
underfunding of U.S. efforts in the field, and break out of the
increasing tendency to see Embassies as fortresses that need to be
defended, rather than as the first line of action.

Shaping the Post-Iraq Environment
Wars are usually a bad time to try to shape regional policy. It
should be clear, however, that even the best outcome in Iraq is not
going to transform any other nation in the region in the near to mid-
term if ever. Any U.S. defeat in Iraq is going to immediately affect
the U.S. in every other area of U.S. policy in the region.
The U.S. cannot afford to defer any of these other issues and
concentrate on Iraq--whether it adopts a ``play the course'' strategy
in Iraq or any other approach. It needs a comprehensive strategy and
action plan for dealing with the Middle East--win, lose, or draw.

__________
NOTES
\1\ There are many poll results that make this point. Perhaps the
best in terms of detail was one sponsored by ABC and conducted in
February 2004. It showed that the Iraqi people as a whole still had
real hope for the future. At the same time, the polls made it clear
that there already were deep divisions within Iraqi society that could
block nation building, or even lead to civil war. The results of the
poll were mixed. Some reflected the deep ethnic and religious
differences in Iraq. Other results were more optimistic. Even if one
looks at results for the least confident group--the Sunnis--it is
obvious that most Iraqis saw life as getting better, understood that
Iraq was in transition, and had hope for the future.
The ABC News poll found the following attitudes:

------------------------------------------------------------------------
Percent responding to survey question
-----------------------------------------
Shi'ite
Sunni Arabs Arabs Kurds
------------------------------------------------------------------------
Life these days:
Good...................... 66 67 85
Bad....................... 33 33 13
Life compared to one year ago:
Better.................... 50 60 69
Worse..................... 25 16 13
Expectations:
Better.................... 61 72 83
Worse..................... 12 4 2
------------------------------------------------------------------------

The attitudes reflected in the ABC poll scarcely provided any
guarantee of success, victory, and peace. Minorities generally shape
violence and civil war, not majorities. It was clear from the broader
range of results discussed throughout this analysis that there were
Iraqis that remained extremely hostile to the Coalition. This was
particularly true in Iraq's western province of Anbar and the most
hostile cities in the Sunni triangle, but it was also true of some
Shi'ites as well.
The evolving mix of insurgents that the U.S. and Coalition had
begun to fight in the late spring of 2003 also had significant popular
support in their ethic area. Anbar is the single most Sunni Arab-
dominated province in Iraq, the area with violently hostile cities like
Fallujah, and anger over the U.S.-led invasion spikes in that group,
which was favored under Saddam Hussein's regime. ABC estimates that
Anbar has some 5% of Iraq's population and is 92% Sunni and 91% Sunni
Arab. It also accounts for 17% of all Sunni Arabs.
In a February ABC News poll of Iraq, 71 percent of respondents in
Anbar viewed attacks on coalition forces as ``acceptable'' political
action. Among all Iraqis, just 17 percent held that view. Similarly, 56
percent in Anbar said attacks on foreigners working alongside the CPA
are acceptable, compared with 10 percent of all Iraqis. The ABC
analysis found that Anbar residents are no worse off economically than
most Iraqis. But they are less apt to say their lives are going well
(52 percent in Anbar, compared with 70 percent in all Iraq); their
expectations for the future are less positive; and above all, they are
far more deeply aggrieved over the invasion and occupation.

Eighty-two percent in Anbar say the invasion was ``wrong,''
compared with 39 percent of all Iraqis. (Sixty-seven percent in
Anbar say it was ``absolutely'' wrong, compared with 26 percent
nationally.)
Residents of Anbar are twice as likely as all Iraqis to say
the invasion humiliated rather than liberated Iraq.
Sixty-five percent in Anbar say coalition forces should
leave now, compared with 15 percent of all Iraqis.
More residents in Anbar prefer ``a strong leader for life''
than either a democracy or an Islamic state. In all Iraq, more
prefer democracy.
Attitudes in Hostile Areas: The Sunni Triangle
The ABC poll figures for the attitudes in the entire Sunni triangle
(Ramadi, Fallujah, Tikrit, Samara, Baquba, and Baaji) are only
marginally more reassuring. This area is estimated to have some 12% of
Iraq's population and is 81% Sunni and 79% Sunni Arab. It has 34% of
all the Sunni Arabs in Iraq.

Seventy-one percent in the Sunni Triangle say the invasion
was ``wrong,'' compared with 39 percent of all Iraqis. (Fifty-
six percent in Sunni Triangle say it was ``absolutely'' wrong,
compared with 26 percent nationally.)
Residents of Sunni Triangle are nearly twice as likely as
all Iraqis to say the invasion humiliated rather than liberated
Iraq.
Thirty-eight percent in Sunni Triangle say coalition forces
should leave now, compared with 15 percent of all Iraqis.
More residents in Sunni Triangle prefer ``a strong leader
for life'' than either a democracy or an Islamic state. In all
Iraq, more prefer democracy. The ABC Poll found the following
results and they seem likely to be equally true of the rest of
the ``Sunni triangle.''

[In percentage]
----------------------------------------------------------------------------------------------------------------
Entire Sunni
Triangle
(Ramadi,
Anbar Fallujah, All Iraqis
Tikrit, Samara,
Baquba, Baaji)
----------------------------------------------------------------------------------------------------------------
Attacks ``acceptable'' on:
Coalition forces......................................... 71 44 17
Foreigners working with CPA.............................. 56 33 10
Presence of coalition forces:
Support.................................................. 85 80 51
Oppose................................................... 9 9 39
``Strongly'' oppose...................................... 76 63 31
Say coalition forces should leave now........................ 65 38 15
Invasion was:
Right.................................................... 9 16 48
Wrong.................................................... 82 71 39
Invasion was ``absolutely'' wrong............................ 67 56 26
Invasion:
Liberated Iraq........................................... 9 14 42
Humiliated Iraq.......................................... 83 75 41
Confident in CPA............................................. 12 14 28
Confident in occupation forces............................... 9 17 25
Preferred political system:
Single leader for life................................... 45 41 28
Islamic state............................................ 18 19 21
Democracy................................................ 18 26 49
No opinion............................................... 19 14 4
Sunni.................................................... 92 81 40
----------------------------------------------------------------------------------------------------------------

The Risk of Shi'ite Hostility
This mix of ethnic, regional, and national results does not imply
that Iraq as a whole cannot reach agreement on a new government. The
ABC poll data show a lack of interest in retribution with regard to the
Ba'athists, and the desire (even in Kurdistan) to keep Iraq as a single
nation in spite of extreme political fragmentation and wariness.
The polling does, however, reflect a host of problems that have
been apparent on the ground ever since the fall of Saddam Hussein.
These include high and unrealistic expectations for the future. They
reflect ongoing public concerns and demands--nationally and locally--
for such essentials of life as security, jobs and electricity. It also
shows that U.S. and Coalition success is critically dependent on
Shi'ite goodwill. Or, to be more objective, success is dependent on
Shi'ite tolerance and intelligent self-interest.
The first year of occupation showed that the Coalition could hope
to win a fight against part of Iraq's Sunnis--if it could eventually
persuade the majority to support the nation building process and accept
peaceful solutions. It showed the Coalition could largely count upon
Kurds--who had nowhere else to go--if they remained unified and were
willing to accept a realistic form of autonomy while respecting the
rights of Arabs and other minorities. Sheer demographics made it clear,
however, that the Coalition effort had no hope of dealing with a true
popular uprising or rejection by the majority of Iraq's Shi'ites, or
with the result of a serious civil war either between Sunni and Shi'ite
or mass popular Shi'ite factions.
It is important to note in this regard that 37% of the Shi'ites
felt humiliated by Iraq's defeat. 35% felt the invasion was wrong, 12%
felt the Coalition should leave immediately, and 12% felt that attacks
on Coalition personnel were acceptable. While only 7% of the Shi'ites
polled preferred a religious leader, 32% preferred a strong leader
versus 39% for democracy.
This is a significant and potentially violent Shi'ite minority,
although the ABC poll also shows that Shias in the South--a region
heavily repressed under Saddam's regime--are more likely than those
elsewhere to say it was right for the coalition to invade, and to say
the invasion liberated rather than humiliated their country.

[In percentage]
------------------------------------------------------------------------
Southern Shia Arabs
Shia Arabs elsewhere
------------------------------------------------------------------------
U.S.-led invasion was:
Right................................... 56 44
Wrong................................... 28 47
Invasion:
Liberated Iraq.......................... 49 34
Humiliated Iraq......................... 27 53
What Iraq needs at this time: A gov't mainly 79 52
of religious leaders.......................
Preferred system:
Democracy............................... 39 41
Islamic state........................... 31 16
Single strong leader.................... 18 33
Confident in religious leaders.............. 57 44
------------------------------------------------------------------------

\2\ Based on the analysis by my colleagues Rick Barton and Sheba
Crocker in ``Progress or Peril? Measuring Iraq's Reconstruction,'' CSIS
Post-Conflict Reconstruction Project, CSIS, 2004.

Oxford: How much confidence do you have in the [U.S. and UK
occupation forces]?

[In percentage]
----------------------------------------------------------------------------------------------------------------
Oct.-Nov. Mar.-Apr.
'03 Feb. '04 '04 Jun. '04
----------------------------------------------------------------------------------------------------------------
Great Deal.................................................. 7.60 8.70 7.00 6
Quite a Lot................................................. 13.60 19.00 18.40 14
Not Very Much............................................... 22.20 25.60 22.30 30
None at All................................................. 56.60 46.80 52.30 51
----------------------------------------------------------------------------------------------------------------
Oxford Research International ``National Survey of Iraq.''

IIACSS: How much confidence do you have in [Coalition forces] to
improve the situation in Iraq?

\3\ E-mail dated 22-11-2004 from Curt Tarnoff, Specialist in
Foreign Affairs, Congressional Research Service, 202-707-7656,
[email protected].
\4\ Once again, the data are uncertain. The original (FY04) request
in education/refugees, etc. was $300 million, in January 2004, it
became $280 million, in April 2004, $259 million, and $379 million
under the re-allocation plan. E-mail dated 22-11-2004 from Curt
Tarnoff, Specialist in Foreign Affairs, Congressional Research Service,
202-707-7656, [email protected].
\5\ Based on the analysis by my colleagues Rick Barton and Sheba
Crocker, ``Progress or Peril? Measuring Iraq's Reconstruction.'' CSIS
Post-Conflict Reconstruction Project, CSIS, 2004.
Attitudes towards Iraqi Police Forces
IIACSS: How much confidence do you have in the [new Iraqi police]
to improve the situation in Iraq?

[In percentage]
------------------------------------------------------------------------
Apr.-May
Jan. '04 '04 May '04
------------------------------------------------------------------------
Great Deal....................... 44.80 47.90 47.30
Fair Amount...................... 35.00 29.60 28.70
Not Very Much.................... 6.70 8.60 5.70
None at All...................... 11.00 11.20 15.80
------------------------------------------------------------------------
IIACSS, Department of State, CPA, ``National Poll of Iraq.''
Iraqi Perception. Also see Saban Center for Middle East Policy,
Brookings Institution, ``Iraq Index: Tracking Reconstruction and
Security in Post-Saddam Iraq,'' and ``Progress or Peril? Measuring
Iraq's Reconstruction,'' CSIS Post-Conflict Reconstruction Project.

Oxford: How much confidence do you have in the [new Iraqi police]?

[In percentage]
----------------------------------------------------------------------------------------------------------------
Oct.-Nov. Mar.-Apr.
'03 Feb. '04 '04 Jun. '04
----------------------------------------------------------------------------------------------------------------
Great Deal.................................................. 19.70 7.60 33.00 35
Quite a Lot................................................. 30.60 43.30 39.20 39
Not Very Much............................................... 33.40 20.60 17.60 20
None at All................................................. 16.30 8.50 10.20 7
----------------------------------------------------------------------------------------------------------------
Oxford Research International, ``National Survey of Iraq.''

Attitudes Toward Iraqi Army Forces
IIACSS: How much confidence do you have in the [new Iraqi army) to
improve the situation in Iraq?

Oxford: How much confidence do you have in the [new Iraqi army]?

[In percentage]
----------------------------------------------------------------------------------------------------------------
Oct.-Nov. Mar.-Apr.
'03 Feb. '04 '04 Jun. '04
----------------------------------------------------------------------------------------------------------------
Great Deal.................................................. 16.00 19.70 24.40 24
Quite a Lot................................................. 30.10 42.20 46.70 50
Not Very Much............................................... 34.30 27.50 17.10 20
None at All................................................. 19.50 10.70 11.80 6
----------------------------------------------------------------------------------------------------------------
Oxford Research International, ``National Survey of Iraq.''

\6\ For a discussion of some of the problems involved, see
``Rebuilding Iraq: Resources, Security, Governance, Essential Services,
and Oversight Issues,'' Washington, GAO-04-902R, June 2004.
\7\ The money allocated to total obligations had only put $2,325
million into the start of the pipeline. Office of the Inspector
General, Coalition Provisional Authority, ``Report to Congress,''
October 30, 2004. p. 59.
\8\ The Deputy DoD OIG for Inspections and Policy is about to begin
a joint project with the DoS OIG to cover all phases of the training
effort for the Iraqi police forces. This should be extended to cover
Iraqi military and security forces.
\9\ Department of Defense, ``Iraq Weekly Status Report,'' September
22, 2004.
\10\ Department of Defense, ``Iraq Weekly Status Report,'' November
3, 2004 and information provided from MNSTC-I.
\11\ http://www.mnstci.iraq.centcom.mil/facts_troops.htm, accessed
November 11, 2004.
\12\ State Department Report, November 19: NATO's Iraq Training
Plans, press release on 23-1-04 as of 9:32 AM.
\13\ Office of the Inspector General, Coalition Provisional
Authority, ``Report to Congress,'' October 30, 2004, p. 69.
\14\ Office of the Inspector General, Coalition Provisional
Authority, ``Report to Congress.'' October 30, 2004.
\15\ Department of Defense, ``Iraq Weekly Status Report,'' November
3, 2004.
\16\ Iraq's oil situation is considerably more complicated than
some estimated indicate. An in depth analysis by DOE/EIA in its Country
Analysis Brief of November 2004 raised the following issues:
In early August 2003, the CPA put the cost of rehabilitating Iraq's
oil sector to its pre-war state at $ 1.144 billion, and the time frame
to do so at nine months. Much of this work is being performed by KBR
under the supervision of the USACE and the ``Restoration of Iraqi Oil''
(RIO) program. In late January 2004, USACE awarded two major upstream
contracts, worth $1.9 billion, under RIO 2. Contracts went to KBR (for
$1.2 billion) in the south; Parsons and Australia's Worley (for $800
million) in the north.
According to the Oil and Gas Journal, Iraq contains 115 billion
barrels of proven oil reserves, the third largest in the world (behind
Saudi Arabia and Canada). Estimates of Iraq's oil reserves and
resources vary widely, however, given that only 10% or so of the
country has been explored. Some analysts (the Baker Institute, Center
for Global Energy Studies, the Federation of American Scientists, etc.)
believe, for instance, that deep oil-bearing formations located mainly
in the vast Western Desert region, for instance, could yield large
additional oil resources (possibly another 100 billion barrels or
more), but have not been explored. Other analysts, such as the U.S.
Geological Survey, are not as optimistic, with median estimates for
additional oil reserves closer to 45 billion barrels.
. . . Iraq generally has not had access to the latest, state-of-
the-art oil industry technology (i.e., 3D seismic, directional or deep
drilling, gas injection), sufficient spare parts, and investment in
general throughout most of the 1990s. Instead, Iraq reportedly utilized
sub-standard engineering techniques (i.e., overpumping, water
injection/``flooding''), obsolete technology, and systems in various
states of decay (i.e., corroded well casings) in order to sustain
production. In the long run, reversal of all these practices and
utilization of the most modern techniques, combined with development of
both discovered fields as well as new ones, could result in Iraq's oil
output increasing by several million barrels per day. In February 2004,
former Iraqi Oil Minister Issam al-Chalabi stated that recent efforts
to boost Iraqi production might be harming the country's oil reserves.
According to the U.N. Joint Logistics Centre (JLC), in August 2003
``about 40% of [northern Iraqi] production [was being] transferred to
the Baiji refinery, with the balance into the fields, ostensibly to
maintain pressure. This is a most unusual practice but extraction of
the surplus crude is necessary to produce much needed LPG. It means,
however that crude oil production is overstated by the volume
reinjected (it not being available for refining or export, but counted
as production). The reinjected crude may be lost forever.'' Meanwhile,
the USACE has stated that its mission was to focus on war-damaged,
above-ground oil facilities, not ``redeveloping the oil fields,'' with
Iraqi engineers reportedly estimating that expected recovery rates at
Kirkuk have fallen as low as 9%, far below industry norms.
On August 13, 2003, Iraq's main oil export pipeline from its main
northern oilfield of Kirkuk to the Turkish port of Ceyhan reopened (see
below for more details), but the line was shut down once again shortly
thereafter due to sabotage on August 15 and 17. The pipeline reopened
once again in early March 2004. Iraq currently is aiming to increase
its exports to around 2.0 MMBD by the end of March 2004, but this goal
depends in large part on security being maintained. Between April 2003
and the end of the year, there were an estimated 86 attacks on Iraqi
oil infrastructure, including the country's 4,350-mile-long pipeline
system and 11,000-mile-long power grid. In response, the U.S. military
set up a 9,700-person force, called Task Force Shield, to guard Iraq's
oil infrastructure, particularly the Kirkuk-Ceyhan line. Under Saddam
Hussein, Iraqi pipelines were guarded in part by local tribes, and in
part by two army divisions dedicated to the task.
. . . As of early March 2004, Iraqi production (on a net basis) had
reached perhaps 2.2 MMBD, with ``gross'' production (including
reinjection) of around 2.4 million bbl/d. Although Iraq is a member of
OPEC, its oil output has not been constrained by OPEC quotas since it
resumed oil exports in December 1996.
Prior to the latest war, oil industry experts generally assessed
Iraq's sustainable production capacity at no higher than about 2.8-3.0
MMBD, with net export potential of around 2.3-2.5 million bbl/d
(including smuggled oil).
Among other challenges in maintaining, let alone increasing, oil
production capacity, were Iraq's battle with ``water cut'' (damaging
intrusion of water into oil reservoirs) especially in the south. In
2000, Saybolt International had reported that NOC and SOC were able to
increase their oil production through use of short-term techniques not
generally considered acceptable in the oil industry (i.e., ``water
flooding,'' injection of refined oil products into crude reservoirs).
The Saybolt report now appears to have been largely accurate. In
addition, a U.N. report in June 2001 said that Iraqi oil production
capacity would fall sharply unless technical and infrastructure
problems were addressed.
Oil market consultants PFC Energy have stated that ``unless water
injection used to maintain pressure in the southern fields is
restarted, there is a strong possibility that [they] will go into more
rapid decline and suffer permanent reservoir damage.'' PFC added that
``this means the rehabilitation work at the Garmat Ali water processing
plant is crucial.'' U.N. oil experts reportedly have estimated that
some reservoirs in southern Iraq have been so badly managed that their
ultimate recovery rates might be only 15%-25%, well below the 35%-60%
usually seen in the oil industry.
Iraq's southern oil industry was decimated in the 1990/1991 Gulf
War, with production capacity falling to 75,000 bbl/d in mid-1991. That
war resulted in destruction of gathering centers and compression/
degassing stations at Rumaila, storage facilities, the l.6-MMBD
(nameplate capacity) Mina al-Bakr/Basra export terminal, and pumping
stations along the l.4-MMBD (pre-war capacity) Iraqi Strategic (North-
South) Pipeline. Seven other sizable fields remain damaged or partially
mothballed. These include Zubair, Luhais, Suba, Buzurgan, Abu Ghirab,
and Fauqi. Generally speaking, oilfield development plans were put on
hold following Iraq's invasion of Kuwait, with Iraqi efforts focused on
maintaining production at existing fields.
. . . In December 2002, the Council on Foreign Relations and the
Baker Institute released a report on Iraq's oil sector. Among other
things, the report concluded that: (1) Iraq's oil sector infrastructure
is in bad shape at the moment, being held together by ``band-aids,''
and with a production decline rate of 100,000 bbl/d per year; (2)
increasing Iraqi oil production will require ``massive repairs and
reconstruction . . . costing several billions of dollars and taking
months if not years''; (3) costs of repairing existing oil export
installations alone would be around $5 billion, while restoring Iraqi
oil production to pre-1990 levels would cost an additional $5 billion,
plus $3 billion per year in annual operating costs; (4) outside funds
and large-scale investment by international oil companies will be
needed; (5) existing oil contracts will need to be clarified and
resolved in order to rebuild Iraq's oil industry, with any ``prolonged
legal conflicts over contracts'' possibly ``delay[ing] the development
of important fields in Iraq''; (6) any ``sudden or prolonged shut-
down'' of Iraq's oil industry could result in long-term reservoir
damage; (7) Iraq's oil facilities could easily be damaged during any
domestic unrest or military operations (in early February 2003, the
Patriotic Union of Kurdistan claimed that Iraqi soldiers were mining
oil wells in the north of the country in anticipation of war); and (8)
given all this, a ``bonanza'' of oil is not expected in the near
future.
According to the Middle East Economic Survey (MEES), problems at
Iraqi oil fields include: years of poor oil reservoir management;
corrosion problems at various oil facilities; deterioration of water
injection facilities; lack of spare parts, materials, equipment, etc.;
damage to oil storage and pumping facilities; and more. MEES estimates
that Iraq could reach production capacity of 4.2 MMBD within three
years at a cost of $3.5 billion. The International Energy Agency, in
contrast, estimates a $5 billion cost to raise Iraqi output capacity to
3.7 MMBD by 2010, and a $42 billion cost to raise capacity to 8 MMBD by
2030.
\17\ Department of Defense, ``Iraq Weekly Status Report,'' November
3, 2004.
\18\ Office the Press Secretary, Press Release, November 21, 2004,
508 PM.
\19\ An EIA report dated 11-04 notes that, ``the country's economy,
infrastructure, environment, health care system, and other social
indicators all deteriorated sharply. Iraq also assumed a heavy debt
burden, possibly as high as $116 billion if debts to Gulf states and
Russia are counted, and even more if $250 billion in reparations
payment claims stemming from Iraq's 1990 invasion of Kuwait are
included. It is possible, however, that much of Iraq's debt will be
written off in the end, and that reparations will be capped at a
certain level, possibly around $40 billion. In December 2003, former
U.S. Secretary of State James Baker was sent as an envoy to several of
Iraq's major creditor nations, attempting to secure pledges to write
off some of Iraq's debt. Russia stated that it would be willing to
write off part or all of the $8 billion it is owed in exchange for
favorable consideration for Russian companies on Iraqi oil and
reconstruction projects. In January 2004, Kuwaiti Prime Minister al-
Sabah announced that his country would be willing to waive some of the
$16 billion owed by Iraq, and would help reduce Iraq's overall foreign
debts as well. Under U.N. Security Council Resolution 1483, Iraq's oil
export earnings are immune from legal proceedings, such as debt
collection, until the end of 2007.''
\20\ Richard F. Grimmett, ``Conventional Arms Transfer to
Developing Nations, 1996-2000,'' Washington, Congressional Research
Service, CRS RL32547, August 26, 2004, pp. 50 and 61.
\21\ Richard F. Grimmett, ``Conventional Arms Transfer to
Developing Nations, 1996-2000,'' Washington, Congressional Research
Service, CRS RL32547, August 26, 2004, pp. 50 and 61.
\22\ IAEA GOV/2004/60, ``Implementation of the NPT Safeguards
Agreement in the Islamic Republic of Iran,'' Report by the Director
General, 1 September 2004.
\23\ Sanger, David, ``Pakistan Found to Aid Iran Nuclear Efforts,''
The New York Times, September 2, 2004.
\24\ Michael Evans and David Charter, ``NATO will send More Troops
to Afghanistan,'' London Times, June 29, 2004; Defense News.com, June
30, 2004.
\25\ See http://www.eia.doe.gov/emeu/cabs/pgulf.html, DOE/EIA
estimated in September 2004 that the Persian Gulf contains 715 billion
barrels of proven oil reserves, representing over half (57%) of the
world's oil reserves, and 2,462 Tcf of natural gas reserves (45% of the
world total). Also, at the end of 2003, Persian Gulf countries
maintained about 22.9 MMBD of oil production capacity, or 32% of the
world total. Perhaps even more significantly, the Persian Gulf
countries normally maintain almost all of the world's excess oil
production capacity. As of early September 2004, excess world oil
production capacity was only about 0.5-1.0 MMBD, all of which was
located in Saudi Arabia.
According to the Energy Information Administration's International
Energy Outlook 2004, Persian Gulf oil production increased from 18.7
MMBD in 1990 to 22.4 MMBD in 2001. It is expected to reach about 27.9
MMBD by 2010, and 38 MMBD by 2020, and 45.0 MMBD in 2025. This would
increase Persian Gulf oil production capacity to over 33% of the world
total by 2020, up from 28% in 2000.
The estimate does, however, change significantly in the high oil
price case: It is expected to reach about 21.4 MMBD by 2010, and 27.3
MMBD by 2020, and 32.9 MMBD in 2025.
\26\ Estimates differ according to source. The last comprehensive
USGS analysis was performed in 2000, and was seriously limited by the
fact many countries were affected by war or internal turmoil and
declared reserves without explaining them or provided data by field.
Standard estimates of reserves by non-USG sources like those in the Oil
and Gas Journal and World Oil do not adjust reported data according to
a standardized methodology or adjust for the large number of countries
that never alter their estimates of reserves for actual production.
For example, six of the ten nations with the largest proven
reserves are in the MENA region. An IEA analysis shows a range of 259-
263 billion barrels for Saudi Arabia, 105-133 billion for Iran, 66-98
billion for the UAE, and 31-29 billion for Libya. The figure of 115
billion for Iraq is consistent only because it is a figure announced in
the past by the Iraqi government and there are no accurate, verified
estimates. To put these figures in perspective, the range for Russia is
60-69 billion, 25-35 billion for Nigeria, 23-21 billion for the U.S.,
and 52-78 billion for Venezuela. (International Energy Agency, ``Oil
Market Outlook,'' World Energy Outlook, 2004, OECD/IEA, Paris, October
2004, Table 3.2.)
Estimates alter radically if an unconventional oil reserve like
Canadian tar sands are included. The Middle East has only about 1% of
the world's known reserves of oil shales, extra heavy oil, tar sands,
and bitumen. Canada has 36%, the U.S. has 32%, and Venezuela has 19%.
The rest of the world has only 12%. The cost-effectiveness of producing
most of these reserves, and the environmental impact, is highly
uncertain, however, even at high oil prices. (International Energy
Agency, ``Oil Market Outlook,'' World Energy Outlook. 2004, OECD/IEA,
Paris, October 2004, Figure 3.13.)
Reserve estimates also change radically if ultimately recoverable
reserves are included, and not simply proven reserves. Some estimates
put the total for such reserves at around 2.5 times the figure for
proven reserves. For example, the IEA estimate for the Middle East
drops from around 60% to 23%. Such estimates are speculative however,
in terms of both their existence and recovery price, and do not have
significant impact on estimates of production capacity through 2025-
2030. They also ignore gas and gas liquids. The Middle Eastern share of
undiscovered oil and gas resources rises to 27% based on existing data.
Such estimates are also heavily biased by the fact that so little
experimental drilling searching for new fields occurred in the Middle
East between 1992 and 2002. The IEA estimates that only 3% of some
28,000 wildcat explorations for new fields worldwide took place in the
Middle East. Recent exploration in key countries like Iran, Iraq, and
Libya has been minimal. Some 50 Saudi fields, with 70% of the reserves
that are proven, still await development. (International Energy Agency,
``Oil Market Outlook,'' World Energy Outlook, 2004, OECD/IEA, Paris,
October 2004, Figure 3.15.)
\27\ Guy Caruso, ``U.S. Oil Markets and the Middle East, DOE/EIA,''
October 20, 2004.
\28\ IEA estimate in the World Energy Outlook for 2004, Table 3.5,
and analyzed in Chapter 3.
\29\ The DOE/EIA, ``International Energy Outlook for 2004,'' can be
found at http://www.eia.doe.gov/oiaf/ieo/download.html.
\30\ See http://www.eia.doe.gov/emeu/cabs/pgulf.html. In 2003,
Persian Gulf countries had estimated net oil exports of 17.2 MMBD of
oil (see pie chart). Saudi Arabia exported the most oil of any Persian
Gulf country in 2003, with an estimated 8.40 MMBD (49% of the total).
Also, Iran had estimated net exports of about 2.6 MMBD (15%), followed
by the United Arab Emirates (2.4 MMBD--14%), Kuwait (2.0 MMBD--12%),
Iraq (0.9 MMBD--9%), Qatar (0.9 MMBD--5%), and Bahrain (0.01 MMBD--
0.1%).
U.S. gross oil imports from the Persian Gulf rose during 2003 to
2.5 MMBD (almost all of which was crude), from 2.3 MMBD in 2002. The
vast majority of Persian Gulf oil imported by the United States came
from Saudi Arabia (71%), with significant amounts also coming from Iraq
(19%), Kuwait (9%), and small amounts (less than 1% total) from Qatar
and the United Arab Emirates. Iraqi oil exports to the United States
rose slightly in 2003, to 481,000 bbl/d, compared to 442,000 bbl/d in
2002. Saudi exports rose from 1.55 MMBD in 2002 to 1.77 MMBD in 2003.
Overall, the Persian Gulf accounted for about 22% of U.S. net oil
imports, and 12% of U.S. oil demand, in 2003.
Western Europe (defined as European countries belonging to the
Organization for Economic Cooperation and Development--OECD) averaged
2.6 MMBD of oil imports from the Persian Gulf during 2003, an increase
of about 0.2 MMBD from the same period in 2002. The largest share of
Persian Gulf oil exports to Western Europe came from Saudi Arabia
(52%), with significant amounts also coming from Iran (33%), Iraq (7%),
and Kuwait (6%).
Japan averaged 4.2 MMBD of net oil imports from Persian Gulf during
2003. Japan's dependence on the Persian Gulf for its oil supplies
increased sharply since the low point of 57% in 1988 to a high of 78%
in 2003. About 30% of Japan's Persian Gulf imports in 2003 came from
Saudi Arabia, 29% from the United Arab Emirates, 17% from Iran, 12%
from Kuwait, 11% from Qatar, and around 1% from Bahrain and Iraq
combined. Japan's oil imports from the Persian Gulf as a percentage of
demand continued to rise to new highs, reaching 78% in 2003.
\31\ Estimates by country and necessarily uncertain. The
``International Energy Outlook for 2004'' estimate of production
capacity in MMBD for MENA countries is as follows:

----------------------------------------------------------------------------------------------------------------
2010 2020 2025
--------------------------------------------------------
Country 2001 High High High
Reference price Reference price Reference price
----------------------------------------------------------------------------------------------------------------
Iran........................................... 3.7 4.0 3.5 4.7 3.8 4.9 4.3
Iraq........................................... 2.8 3.7 2.9 5.3 3.7 6.6 4.6
Kuwait......................................... 2.3 3.7 2.3 4.4 2.9 5.0 3.4
Qatar.......................................... 0.6 0.6 0.6 0.8 0.7 0.8 0.7
Saudi Arabia................................... 10.2 13.2 9.4 18.2 12.9 22.5 16.0
UAE............................................ 2.7 3.3 2.7 4.6 3.3 5.2 3.9
----------------------------------------------------------------
Total Gulf............................... 22.4 27.9 21.4 38.0 27.3 45.0 32.9
================================================================
Algeria........................................ 1.6 2.0 1.6 2.4 2.0 2.7 2.2
Libya.......................................... 1.7 2.0 1.7 2.6 2.1 2.9 2.4
Other Middle East.............................. 2.0 2.2 2.4 2.6 2.9 2.8 3.1
----------------------------------------------------------------
Total Other.............................. 4.3 6.2 5.7 7.6 7.0 8.4 7.7
================================================================
Total MENA............................... 26.7 34.1 26.1 45.6 34.3 53.4 40.6
Total World.................................... 79.3 95.1 90.0 114.9 107.2 126.1 117.3
(US)........................................... 9.0 9.5 9.9 8.9 9.6 8.6 9.0
----------------------------------------------------------------------------------------------------------------

OPEC data are labeled confidential but are very similar. The IEA
does not provide country-by-country estimates, but uses very similar
models with similar results. It estimates total world production was 77
MMBD in 2002, and will increase to 121 MMBD in 2030. If one looks at
the data for the Middle East, the latest IEA estimates are as follows:
The IEA estimate in the ``World Energy Outlook for 2004,'' Table
3.5, is:

----------------------------------------------------------------------------------------------------------------
Ave.
annual
2002 2010 2020 2030 growth
(percent)
----------------------------------------------------------------------------------------------------------------
OPEC Middle East................................................. 19.0 22.5 37.4 51.8 3.6
Other Middle East................................................ 2.1 1.8 1.4 1.0 -2.7
----------------------------------------------
Total...................................................... 21.1 24.3 38.8 52.8 .........
Non-Conventional Oil (Worldwide)................................. 1.6 3.8 6.1 10.1 6.7
World............................................................ 77.0 90.4 106.7 121.3 1.6
----------------------------------------------------------------------------------------------------------------

\32\ See http://www.eia.doe.gov/emeu/security/choke.html#HORMUZ.
The Strait is the narrow passage between Iran and Oman that connects
the Persian Gulf with the Gulf of Oman and the Arabian Sea. It consists
of 2-mile-wide channels for inbound and outbound tanker traffic, as
well as a 2-mile-wide buffer zone. The EIA estimates that some 13 MMBD
flowed through the Strait in 2002. The IEA puts the figure at 15 MMBD
in 2003. Both agencies indicate that the amount of oil moving by tanker
will increase steadily as Asian demand consumes a larger and larger
share of total exports.
Closure of the Strait of Hormuz would require use of longer
alternate routes (if available) at increased transportation costs. Such
routes include the 5 million-
bbl/d capacity Petroline (East-West Pipeline) and the 290,000-bbl/d
Abqaiq-Yanbu natural gas liquids line across Saudi Arabia to the Red
Sea. Theoretically, the l.65-MMBD Iraqi Pipeline across Saudi Arabia
(IPSA) also could be utilized, more oil could be pumped north to Ceyhan
(Turkey), and the 0.5 million-bbl/d Tapline to Lebanon could be
reactivated.
\33\ International Energy Agency, ``Oil Market Outlook,'' World
Energy Outlook, 2004, OECD/IEA, Paris, October 2004, Table 3.7 and 3.8.
\34\ International Energy Agency, Oil Market Outlook, World Energy
Outlook, 2004, OECD/IEA, Paris, October 2004, Chapter 3.
\35\ BP/Amoco, ``BP Statistical Review of World Energy,'' London,
BP, 2003, p. 17.
\36\ BP/Amoco, ``BP Statistical Review of World Energy,'' London,
BP, 2003, p. 17.
\37\ EIA ``Annual Energy Outlook, 2003,'' pp. 80-84.
\38\ Energy Information Administration, ``Annual Energy Outlook
2004,'' p. 95.
\39\ EIA, ``Annual Energy Outlook, 2004,'' Table 26.

The Chairman. Well, thank you very much, Dr. Cordesman, for
a very comprehensive, very important paper. As you saw, some
members were nodding at various points. A good number of these
issues are ones in which we find accord. You have phrased the
issue in an articulate way. Now, there are others that we may
want to question, and we will be doing that in a moment. This
is why we have called General Newbold and Mr. Khalil for
immediate commentary on your paper.
Let me mention, if I can engage in a colloquy with the
distinguished ranking member for a moment, that the
distinguished ranking member requests that after the comments
by General Newbold and Mr. Khalil, he be recognized for his
opening statement. That seems to be a reasonable thing to do.
Senator Biden. I do not want to interrupt the flow here.
The Chairman. The other reasonable thing to do, if we can.
We have nine members present. We are approaching a quorum. We
could obviate the need to meet in a business meeting at 2:30,
given the fact that there appears to be unanimous consent, as
far as I can tell, on the effective busywork that we need to
do, namely the adoption of our rules, budget resolution,
subcommittee organization and membership.
Senator Biden. That is correct. There is no disagreement on
our side.
The Chairman. So, not to disconcert the witnesses, but at
the proper moment, I might call for order and dispense with
that business if possible. If not, I would ask all members to
be prepared to meet at 2:30 this afternoon in S-116 to do that
business.
I call now on General Newbold.

STATEMENT OF GREGORY S. NEWBOLD, LIEUTENANT GENERAL, U.S.
MARINE CORPS (RET.), MANAGING DIRECTOR, GLOBESECNINE

General Newbold. Thank you, Mr. Chairman. I am honored to
be here, obviously, on the subject before this committee.
The first thing I would like to offer is that I am
comforted that the debate, the discussion, the dialogue, is
taking place before this committee. Too often this is viewed as
a solely military issue with military solutions and the fact is
that it is not. It takes all elements of our national power to
address this issue, and most fundamentally this committee is
the appropriate one.
Sir, I have prepared a written testimony that I would like
to offer for the record.
The Chairman. It will be made a part of the record in full.
General Newbold. Thank you, sir.
I will make comments that highlight what are in the written
testimony. I know that your first priority is that I comment on
Dr. Cordesman's paper and I will do that and then offer some of
my own views.
I have read a lot of Dr. Cordesman's writings and we have
discussed these issues at length. I have a great deal of regard
for him and for his paper. I find very little not only to
disagree with, but virtually everything to support. I have also
read his written testimony and, frankly, I find that even
better. I think it is more focused and pointed. It is critical,
but where it is critical it makes a great deal of sense, and it
matches my personal experience.
I will not regurgitate the points he has made, but I would
like to highlight and reinforce some of my own that complement
what Dr. Cordesman has said. In particular and in no particular
order, I think our public diplomacy, information operations
campaign, not only in Iraq but elsewhere, have been abysmal. It
is almost a cultural weakness of ours, but very costly when we
are this inefficient and this ineffective.
Our regional policies, as Dr. Cordesman pointed out, are
viewed as one-sided and they have implications and effects that
reach far beyond Iraq. In fact, when I am asked about an
appropriate Iraq strategy my first answer is that there is no
independent Iraq strategy; it has to be a regional strategy.
When our policies are viewed as so totally one-sided, the
complications are evident.
We had an extremely poor plan prior to the invasion for
what would take place after the invasion. There was some
planning done on the military level. It was done in spite of
the process, not because of it. We have inherited the seeds
that we have sown and the vacuum that we created, and that is
very unfortunate. More unfortunate is that if we do not correct
this process that resulted in such flawed and even arrogant
planning, we are doomed to repeat it.
I would like to point out that I think the United States
military in Iraq has performed magnificently at the operational
and at the tactical level. I have a number of friends that have
been involved in the fight and, frankly, I spend part of every
single day trying to take care of the wounded sailors and
marines who are at Bethesda, Walter Reed, and elsewhere. I have
enormous respect for what they have accomplished, but I believe
that much of it is in spite of our policies and our strategy
and not because of it. They deserve all the credit and all the
support we can give them.
But the truth is we have overly focused on military
solutions. We focused on military strategy for Iraq and in the
postwar phase we have been very energetic on the military
front, but that should not be the centerpiece for our policies,
as I will point out.
At the national level, we have been deluding ourselves on
some key points, probably most importantly on the nature of the
insurgency in Iraq, but also on the nature of what it will
take, more broadly than Iraq, to counter radical Islam and
terrorism and to develop the policies and procedures that will
accommodate that.
The state of training of Iraqi forces were described by Dr.
Cordesman and in my own opinion we are either deluding
ourselves or it is being misrepresented. I will talk a little
bit more about the Iraqi national guard and the Iraqi army
later on. But if the centerpiece for our withdrawal is the
state of training, then we first must be honest about it.
We also have not had truly an international coalition to
the degree that has been described and we will begin to lose
additional members of the coalition.
The fundamental reality of what exists in Iraq right now is
that we have an intractable insurgency of great vehemence that
has cost us over 10,000 casualties and over 1,000 Americans. It
has no immediate end in sight and we ought to know by now what
our strategy is. I do not think we do.
No matter what strategy we adopt, I think we ought to have
a clear goal to be out of Iraq within 2 years. That may not be
achievable, but it ought to be our goal. If we set it as our
goal, perhaps we will assign the assets, the resources, and the
mental energy to achieve it. If we are content to stay in Iraq
for 5 years, if we are content to sustain the casualties at the
rate we have to date, then it will be our future.
A fundamental weakness of what we have been doing in Iraq
in my view is that we have viewed the Iraq situation
overwhelmingly from an American perspective. This is not unique
to this administration. It is something I have witnessed in
administrations for as long as I have been involved in the
process. But it is the problem we have right now, and examples
of what I am talking about, the ethnocentric view of this
situation, include on the political front expectations that I
believe are exaggerated of what are immediately achievable in
Iraq.
Our goals ought to be noble and they ought to be very
challenging. But we cannot set them as the minimum standard for
what we will accept in Iraq. It is not Iowa. It has a rich
history of clan-tribal accommodations and government that will
take generations to overcome.
The second problem I see on our American perspective of the
issue is that we see the insurgency as a military problem. As I
will point out later, we have failed to grasp what has caused
the insurgency and what has sustained it. If we view it only in
military terms, then we will have only military solutions. We
have done a wonderful job on the tactical level. We have killed
literally thousands of insurgents. We have inflicted punishing
defeats on the insurgents in Najaf, in Samarrah, and in
Fallujah. But during the same timeframe we have had such great
victories on the tactical level, the insurgent strength has
grown from 5,000 to 20,000. We cannot kill the insurgents as
fast as they can recruit them, so we have to look for a
different strategy.
Most troubling of all the American perspective problems I
have described is that we have yet to articulate why we believe
that ordinary Iraqis, Shiites and Sunnis, men and women, old
and young, Baathist and the downtrodden, have joined the
insurgency. Until we describe its root causes, we will not come
up with the solutions that address them. The most basic primer
at any war college will tell you that you begin to fight an
insurgency by understanding why there is an insurgency. In all
my contacts and all my reading and all the expressions I have
heard, I have yet to see the government address that.
I would like to point out that among the solutions I would
recommend, none of them involve an immediate withdrawal. I
think that would be a catastrophic mistake----
Senator Biden. Say that again, General, because I did not
hear it. I did not hear what you just said.
General Newbold. Sir, I think it would be a catastrophic
mistake to have a strategy that would call for an immediate
withdrawal.
Senator Biden. Thank you.
General Newbold. I think the implications of that would be
catastrophic because, not only in the Iraqi sense, but for the
signal it sends to the world and the encouragement it would
give to those who have confronted us. I am not asking for that,
not recommending that at all.
However, we have to understand that the fundamental reason
for the insurgency, the thing that ties all of the various
groups together, is that in their view we are an occupying
power. It does not matter how noble our reasons and our
rationale. It does matter what they believe the reasons are.
They see us as a western power in their country, in their
region, for oil, and we have to do something that addresses
that.
I have close friends and people I respect that have
countered the milestones and timelines argument by saying that
the insurgents will hunker down and wait for our withdrawal and
then go on the offensive. I think they make a fundamental and
sad mistake. If they would address first why so many people,
why 20,000, are in the insurgents and why so many more are
supporting the insurgency, they will examine that and find that
if we withdrew then the insurgency would unravel. Now, there
are conditions we must establish for a withdrawal and I will
address them.
We have to have a new strategy, a recrafted one. It has to
be bolder, more flexible, and more imaginative than we have had
to date. It has to be based on military actions that strike the
insurgency and dissipate its strength. But even more important,
it must tie ordinary citizens of Iraq to the future that we
have described and the new elected government will describe.
They have to have more stake in the future that we postulate
than the one the insurgents do and they must believe that we
can achieve what we said.
Dr. Cordesman has talked about the woeful steps that have
been taken to provide the ordinary comforts of life to the
Iraqi citizens, ordinary comforts that are not ordinary in
Iraq. Six hours of electricity a day in Baghdad is one
testimony to that.
Our troops have performed with distinction, but they cannot
do it all. We have a golden opportunity with the election. It
is a wonderful manifestation of what is possible. But we will
lose the momentum quickly if we do not sustain the effort on a
broader array of fronts.
More specifically, in the security realm there has been an
enormous amount of progress and innovativeness in the last
month. With General Casey and General Luck's visit and most
especially with General Abizaid's plan to greatly augment the
forces that will train the Iraqi army, I see a good amount of
hope. The Iraqi national guard effort was a huge mistake. It
was not only ineffective, it was counterproductive. It consumed
an enormous amount of equipment and money and, at least in the
Sunni areas, it was a totally ineffective force.
The Iraq army, on the other hand, much more competent. In
places where it has had to fight it has fought well. It will
take some time, but it will take time according to the surge
efforts we make. I am encouraged by what has happened in the
last month.
Dr. Cordesman has talked about the pitiful efforts we have
made to equip. After a year and a half, we are now approaching
the 50-percent level in most of the items that are desperately
needed, and we have to do better than that. We have to call on
our allies, not only to make promises to help train, but to
deliver on those promises. And in my view, if it takes
additional forces in the short term to control the rest of
areas like Mosul and others that percolate, then we ought to do
that, rather than sustain this level of effort for 5 more years
of bleeding.
In the political realm, if it had matched the efforts on
the military side we would not be having the problems we are
today. The fact is most of the political effort was expended in
Baghdad and the insurgency will be won or lost in the interior.
After a year of trying, there has been almost no success in
getting political training teams out into the interior to help
with the provinces, and that is unsatisfactory.
My recommendation is that we regionalize our effort in
Iraq, that we create a graduated or an exaggerated system of
carrots and sticks, incentives and disincentives, by which
stable areas of Iraq can receive benefits that make them a
clear model for the others to emulate. The areas unstable will
be told that they will receive the benefits, the gratuities,
the independence, independence of judgment, etcetera, only when
they become stable. As it stands right now, all of the regions
are created equally, treated equally, and that is unfortunate.
Unless there are incentives we cannot condition human behavior
to adjust.
In the economic realm, Dr. Cordesman has talked at length
about that. Suffice it to say that the meager expenditure of
our resources has had an outcome that has undermined our
effort. Quality of life for Iraqis must improve. We must
provide jobs to give people an alternative to the insurgency,
and we frankly have to overhaul what has been done there, as
Dr. Cordesman said.
Finally, in the war of public opinion, I have already
described how poorly we have done. In that regard, I go out on
a limb independent of many of the people whose opinion I
respect. I truly believe that one of the reasons for the
vehemence of the insurgency is that they view us as an
occupying power. While I do not recommend timelines, I do
recommend that we break away from a blind obedience to the code
of conditions only and offer some hope to the Iraqis
conditioned on a roadmap. We ought to provide an example that
will indicate that if conditions in Iraq or in the provinces--
one at a time, become more stable, that they will see the
coalition forces are withdrawing.
There is a way to do that. We can do it with illustrative
examples that shift the responsibility directly to the
insurgents for the length of the stay of the U.S. forces. I
believe that we have to do that. The ordinary Iraqi has to know
that United States and coalition forces are there because the
insurgents have made that a requirement. Together with the
newly elected government of Iraq, we ought to indicate that
forces can begin withdrawing when the insurgent activity
declines, as soon as the end of the year. If conditions were
such that the Iraqi army was fully capable of handling an
inconsequential insurgency, then it is possible that our forces
could largely be withdrawn by the end of 2006.
If conditions do not allow that because the insurgents
refuse to comply, then it is their responsibility for an
extended stay. We ought to use this in an information campaign
broadcast by the President and articulated on a daily basis to
ensure that the message is loud and clear, not only in Iraq,
but throughout the region.
I think the elections gave us a wonderful opportunity, but
the momentum will soon slip. We need to be more open-minded
about possible alternatives to our strategy in Iraq. We need to
listen to different voices. We need to be flexible and adaptive
and we need to re-invigorate the three elements of national
power that have been so weak so far.
Mr. Chairman, thanks for the time to appear before the
committee.
[The prepared statement of General Newbold follows:]

Prepared Statement of Gregory S. Newbold, Lieutenant General, U.S.
Marine Corps (Ret.), Managing Director, GlobeSecNine, Arlington, VA

First, I am honored to have been invited before this Committee,
composed of these members, on a subject of such vital importance to our
country.
Second, I am comforted that the forum for this discussion is the
Senate Foreign Relations Committee because too often we view these
issues as military in their origins, processes, and solutions. They are
not. These issues don't start, and their answers don't lie, strictly in
the military realm. To address the issue at hand appropriately, our
nation and this committee must take into account both all elements of
our national power and the character of this insurgency more fully than
we have in the past.
In this paper and during my oral testimony, I will provide my views
about the most productive course for our strategy in Iraq, but will
first comply with the Committee Chairman's letter of invitation, in
which I was asked to provide commentary on Dr. Cordesman's paper,
``Playing the Course: A Strategy for Reshaping U.S. Policy in Iraq and
the Middle East.''
Dr. Cordesman's Paper. As you know, Dr. Cordesman is an astute and
prolific analyst of issues that affect our national security. ``Playing
the Course,'' and a host of other of his papers, perform a great
service by their dissection of key issues in both a detailed and frank
way. Perhaps more importantly, Dr. Cordesman's prescriptions are
generally ahead of government thinking.
In my view, Dr. Cordesman's analysis hinges on his five main
recommendations and four central observations. The recommendations are
essentially these:

Craft a dramatically improved statement of U.S. intent for
Iraq and the region and implement it in an overhauled
communication effort.
Develop more effective Iraqi governance at the local,
provincial, and national level.
Increase the effort to adequately train and equip the Iraqi
security forces.
Improve the political and informational effects of U.S.
military strategy and operations.
Recast the economic focus of effort to increase near term
stability and transition to Iraqi management of this effort as
soon as possible.

Dr. Cordesman's four central observations--as extracted by me--that
I will use as the basis for my comments are these:

The odds of a successful outcome in Iraq are about even.
The U.S. has to seize upon the opportunity to declare
victory and withdraw as soon as possible--probably by the end
of 2006.
The U.S. must see the conflict in broader terms than we are
now. The U.S. must implement regional policies that bring due
credit to us, and we must see the conflict in ways that can
address the root causes of terrorism and the clash of cultures.
The U.S. must free itself from hindrances to its strategic
freedom of action imposed by dependence on Middle Eastern oil.

First, I agree with Dr. Cordesman's recommendations and
observations without caveat or criticism. They are correct. To be
useful to this committee, though, I will reinforce specific points that
I think are crucial to a meaningful analysis, and offer some additional
specificity in recommendations that I think should be fundamental
elements in a re-crafted U.S. strategy.
My reinforcement of Dr. Cordesman's recommendations is based on my
own thoughts:

Our public diplomacy/information operations have been poor
throughout the last several decades and are distinctly not up
to the task today.
Our regional policies are almost universally viewed as one-
sided, and our credibility on almost every other issue is
undermined by this fact.
We had a poor to non-existent plan for the post-invasion
phase, and are now reaping what we sowed. In fact, failing to
correct the conditions that resulted in poor planning may doom
us to repeat them.
The U.S. military has performed magnificently and
heroically--not because of the strategy, but in spite of it.
We have focused overly on the military as a tool to contain
the insurgency, and have been woeful in providing the other
elements of national power that are needed in at least equal
measure.
At the national level, we are deluding ourselves in many key
ways--examples are the public assessments of the state of
training of the Iraqi forces and police, the underlying nature
of and prospects for the insurgency, the degree to which we
truly have an international coalition in support, and in the
strategy for adequately addressing the root causes of
terrorism, radical Islam, and instability in the region.

First, as I see the fundamental reality--we are facing a tough,
resilient insurgency that has no end in close sight. We've had over
10,000 casualties and over 1,000 deaths, and by now we should know
whether our strategy has a realistic chance of creating appropriate
conditions in Iraq and bringing our troops home. In my view, five years
of this is unsustainable in what it will cost us materially (our most
patriotic young citizens), economically, diplomatically, and
politically. We should not accept five years of what we are
experiencing now. No matter whose strategy is adopted, it ought to set
at its goal a termination within two years. Better to surge now--with
whatever that costs us--than to bleed for five years.
A fundamental weakness in my view, and one we must correct, is that
we continue to view Iraq overwhelmingly from an American perspective.
(This is not a phenomenon unique to this Administration, and was
equally a characteristic of the previous one.) Two examples in the
current crisis are illustrative of our myopia. The first is that we
define a satisfactory political outcome--federalism and democracy--in
ways that are more realistic for Iowa than for Iraq. The dream is
correct and noble; the standards for near term attainment are
unrealistic. The second is that we view the insurgency as a military
problem that can be defeated principally by killing more insurgents. In
the past six months we've killed thousands of insurgents and inflicted
significant defeats on them at Fallujah, Samarra, and Najaf--and by our
own estimation the insurgent ranks have grown from 5,000 to 20,000.
What is most troubling is that I have yet to see or hear of a
government assessment that adequately describes what motivates
thousands of young and old, male and female, Sunni, Shia, and Kurdish
Iraqis to attack us with suicidal fervor. The basic primer in all of
the service war colleges instructs you that you cannot formulate an
effective strategy for an insurgency, if you have not adequately
assessed its root causes. As it stands now, we think of the problem and
the target as the insurgents; rather than what creates the insurgents.
We attack the insurgents, rather than what produces them.
Iraq is now fractionalized; some discord and factional fighting are
part of its future. If we departed peremptorily, the cost to Iraq, the
region, our credibility, and probably to our national security, would
be severe. Pared to its core, though, our central problem is that our
attempts to stabilize the country are being undermined by the
insurgency--and the fundamental reason for the insurgency is that we
are occupying Iraq. It does not matter how nobly we view our presence;
what matters is that the absolutely overwhelming view of Iraqis (and of
others in the region) is that we are occupiers. Worse, in their view,
we are Western infidels there only to control oil. Their recruiters are
having a good deal easier time than ours.
The irony of our occupation is simple, but profound--there is no
stability without us, but our presence inflames the insurgency that
causes instability. The trick, then, is to craft a strategy that
neutralizes the rationale for the insurgency--the chief complaints that
drives the active insurgents and their supporters to violence--while
strengthening the stake of the ordinary Iraqi in a future tied to the
legitimate government.
A re-crafted strategy must be far bolder and broader than has been
initiated thus far. Thus far, we have attempted a military defeat of
the insurgents, augmented by weak efforts to improve the material
condition of the Iraqis. As Dr. Cordesman points out, only a small
portion of funding for infrastructure, security, and quality of life
improvements have been spent. The ordinary things that most symbolize a
life with hope--jobs, electricity, clean water, security, and sewage
and trash removal are not ordinary enough. Coalition military training
teams operated throughout the provinces, while training teams to assist
in governance, economics, and information dissemination are scarce
outside of the capital. Our troops have performed with distinction, but
they can't do it all.
We have an opportunity to seize important initiative with the
significant success of the election, but the momentum we gained can be
transitory if not reinforced. The theme to a reinvigorated strategy
should address root causes, and be no more complicated than
dramatically enhanced incentives and disincentives (``carrots and
sticks'') that make clear that the dreams and aspirations of ordinary
Iraqis lie with the new Iraqi government, and the insurgents are the
enemy of their hopes.
Where we need to sustain and augment the effort:
In the Security Realm. While we strike insurgent forces and keep
them off balance, we must give full weight to Gen. John Abizaid's call
for a dramatically enhanced force to train the Iraqi Army. The National
Guard proved to be largely useless in the Sunni areas, and our main
efforts have to focus on the more promising Iraqi Army. We also need
our European allies immediately to fulfill their promise to help train
Iraqi security forces. We must ruthlessly overcome the inertia that has
taken over a year and a half to provide only half of what is needed to
fully equip the Iraqis security forces. Soon, we are going to lose a
portion of our allies on the ground, and we need to replace them as the
need arises. Finally, if we don't want the insurgency to drag on for
five years, we need to be ready to surge adequate forces to dominate
restive areas like Mosul and Ramadi. We have operational momentum, and
we ought to exploit it.
Where we need to overhaul our effort:
In The Political Realm. Our diplomatic and political efforts pale
in comparison to our military ones. Our political assistance is almost
completely restricted to Baghdad, while the insurgency will be won or
lost in the outlying areas. We should implement a regionalization
strategy that empowers the more stable provinces and motivates the
restive areas to change, consistent with a carrot and stick approach.
To the stable areas, we should offer increased financial assistance,
less Coalition presence, and greater autonomy in disbursing aid. This
strategy won't work, however, unless the benefits are exaggerated
enough to encourage emulation by those who don't have them.
Alternatively, the restive areas would receive restricted amounts of
aid, less autonomy, and more Coalition force presence because they
would be augmented by those who are released from duty in the stable
areas. Those in the unstable areas need daily reinforcement that a
better life ensues when the area is stable. When the people believe
this, the insurgents lose their protective cloak and their support
network.
In The Economic Realm. As Dr. Cordesman points out, our inability
to dispense appropriated funds where they are needed is nothing short
of astounding. To a significant degree, the inability to improve the
daily lives of the Iraqi citizen is our biggest failure, and one of the
biggest sources of dissatisfaction. We need to create or restore basic
human services, and we need to establish jobs. If we don't dramatically
alter the speed at which we are dispensing aid, all other efforts may
be moot. The CETA funds, by which military commanders have been able to
fund projects that improve the quality of life for Iraqis in their
area, ought to be an immediate and active model for other agencies.
In The War of Public Opinion. By any poll, scientific or otherwise,
we have performed dismally in attempting to win hearts and minds. [This
almost seems to be an American cultural deficiency, because this trait
has been symptomatic for generations of administrations.] But beyond
our inability to grasp and articulate the themes that resonate most
heartily with the various groups in Iraq, we have little to advertise.
If root causes are important, then we need to find the ways to
neutralize them. When the reasons are material--quality of life
issues--then we need to work to address them, and advertise our
success. Solutions here were previously discussed. The more difficult
situation, though, occurs when the root cause of violent opposition to
our forces, is our forces. To legions of Iraqis driven by what we would
call nationalism, the cause is simple--they are an occupied country.
Since the issue most fueling the insurgency is our presence, we
need to shift responsibility/blame for our current presence to the
insurgents. Simply communicated, we would probably have withdrawn by
now, if not for the actions by the insurgents. And, we could make a
fairly speedy withdrawal now, if not for insurgent actions. The key to
success in the war for public opinion is that we need to be able to
discuss what would happen with success. This approach must be a unified
front with the newly elected Iraqi leadership. In my view, closed
mindedness about discussing anything except that our withdrawal is
wholly ``condition based,'' fuels the perception that we have no
intention of withdrawing. To be sure, we don't need or want precise
timelines, but we ought to be imaginative enough to provide examples of
what could happen if the insurgency was measurably suppressed and the
Iraqi Army was stronger. We must be utterly convincing that the length
of our stay can be short or long--and it is entirely dependent on the
violence currently tolerated by the silent majority of Iraqis.
An Example. Our goal is to leave Iraq a stable country, able to
administer to its own needs and security. This is not now possible.
Should the insurgency wane significantly, however, you might expect to
see reduction in U.S. and Coalition forces by the end of the year. If,
on the other hand, the insurgents refuse to respect the will of the
Iraqi people and its government, we would be compelled to remain until
conditions permitted a beginning to our withdrawal. We would prefer to
begin a withdrawal, but apparently the insurgents are not willing to
see either our departure or the government of the Iraqi people succeed.
Continuing the example, if the insurgency were to be assessed as
``controlled and of minor consequence'' by the end of 2006, there would
be no reason for continued U.S. presence in Iraq--other than those
minor forces requested by the Iraqi government to assist in training
the new Iraqi Army. Such a withdrawal, though, is entirely dependent on
the ability of the Iraqi Army to provide reasonable security. If the
insurgents continue to disrupt the daily lives of Iraqis and their
attempt at democratic government, and the government requests our
continued operations, then we would have no choice but to stay.
We have a chance to build on the success of Sunday's elections, and
future demonstrations of democracy in Iraq, by undermining the
legitimacy of those who violently oppose us. To exploit this success,
though, we need to demonstrate more honesty in self-appraisal, and
greater flexibility and imagination in implementation, than we have to
date. We cannot accept further delays in administering the political,
economic, and public information aspects of our strategy, because the
cost will ultimately be measured in young Americans. We should set
goals for how long we want to sustain this effort, and take the actions
that provide a real opportunity for making them achievable.
This will take flexibility among our key decision-makers, and a
willingness to exploit alternative views and options--neither have been
the norm.

The Chairman. Well, thank you very much, General Newbold,
for your very comprehensive and thoughtful statements. Members
will have questions for you as well as for Dr. Cordesman and
Mr. Khalil in just a few moments.
As the chair announced before General Newbold's testimony,
we would like at this point to have a business meeting, which
would obviate the need to meet this afternoon at 2:30. I have
asked the distinguished ranking member for his permission, and
he has told us to proceed.
So let me just say, now, that more than 10 members are
present. The hearing is now recessed, to reconvene shortly at
the conclusion of the business meeting. For the interest of our
audience, this should take just a moment.
I now call the committee to order and convene the business
meeting. I call members' attention to the business meeting
agenda. The committee must approve subcommittee organization
and membership, subcommittee jurisdiction, Foreign Relations
Committee rules, and the committee budget resolution. These
items are described in your committee memo and all have been
agreed on in discussions between the chairman and the ranking
member. Our responsibility today is to pass these
organizational items so that the committee can become fully
functional in this Congress.
Do you have any further comments, Senator Biden?
Senator Biden. Mr. Chairman, I would just like to survey
again my colleagues.
My understanding is from staff and each of your staffs that
everyone has signed off on and we are all on the same page on
this.
[No response.]
Senator Biden. That being the case, Mr. Chairman, we have
no objection and suggest we adopt the changes, the agenda, as
you have laid it out.
The Chairman. Is there further debate?
[No response.]
The Chairman. If there is no debate, I move that the items
on the agenda be approved en bloc by a voice vote. All in favor
say aye.
[A chorus of ayes.]
The Chairman. All opposed say nay.
[No response.]
The Chairman. The ayes have it and the agenda is passed.
Please record the members who are present. If other members
come in they would have the opportunity to vote. I appreciate
very much the cooperation of the membership.
Senator Biden. Mr. Chairman, a minor little point. Since we
had called the meeting for this afternoon, can we leave the
record open the entirety of the day for those members who may
not make it to this hearing but would like to be recorded?
The Chairman. By unanimous consent, the record will be kept
open for the rest of the day for members' comments or votes or
both.
Senator Biden. Thank you.
The Chairman. I thank Senator Biden.
This concludes the business meeting. I now call to order
the hearing and the Chair recognizes Mr. Khalil. Thank you for
your patience.

STATEMENT OF PETER KHALIL, VISITING FELLOW, SABAN CENTER FOR
THE MIDDLE EAST POLICY, THE BROOKINGS INSTITUTION

Mr. Khalil. Thank you, Mr. Chairman and Senators. I would
also like to thank you and the committee for the honor to
testify today for the first time, and I hope not for the last
time. I am going to start, Mr. Chairman--I have a prepared
written statement also I hope to place in the record.
The Chairman. It will be placed in the record in full.
Mr. Khalil. Thank you, sir.
I am going to keep my remarks brief and to the point. I
have studied Dr. Cordesman's paper and noted his comments today
and General Newbold's comments and agree with the broad thrust
of their arguments. I hope to make apparent any points of
difference as I deliver my comments.
By way of quick introduction and to set the context for my
remarks, I was sent to Iraq as an independent civil servant of
the Australian Government, not a political appointee and I hope
not one of the ideologues that Dr. Cordesman referred to
earlier. I was working in my time there very closely with the
Iraqi political leadership and also the tribal leaders and the
clerics and academics across the country on the issue of
rebuilding the Iraqi security forces and national security
institutions, such as creating the newly civilian-led Iraqi
ministry of defense. I was also involved for some time in
conducting negotiations with Iraqi political militia leadership
in transitioning their forces into the state security services.
It was, if I may say, a great honor to serve my country and
to serve within the U.S.-led coalition. I am honored to be part
of that long tradition of United States-Australian alliance and
real friendship, which I think actually springs not just from
our shared strategic interests but also our shared values.
Even though today I will be focusing on security aspects, I
do agree with Dr. Cordesman that any Iraq strategy must, both
at the operational and strategic level, push progress in a
combination of political transition, security and economic
reconstruction for it to be successful. A successful Iraq
strategy not only defeats the insurgency but makes possible two
very important goals which I do not think are mutually
exclusive. They are: First, a speedy return of United States
troops in the next few years; and second, the longer term
strategic goal of a free and democratic Iraq, able to defend
herself from external threats and no longer a threat to her
neighbors, nor a haven for terrorists. These are goals which I
assume all the Senators on the committee share, although there
may be some disagreement on how to get there.
There are three key areas I want to touch on this morning,
all of which I believe are critical to the successful Iraq
strategy and which can make the achievement of these goals
possible. First, the policy direction of training of Iraqi
security forces, their capabilities, and my firm belief that it
is actually the quality, not the quantity, of these forces
which is critical in ensuring a realistic transfer of security
responsibilities from United States forces to Iraqi forces, and
basically how we should proceed on this front. Second, the
second key area is the critical importance of reform and
rebuilding of the Iraqi security institutions and ministries
and the capacity-building efforts in those structures. Third,
very quickly, where the two tracks of security reforms and
political transition meet and the need, I believe, for the
United States to ensure that there is a commitment to the
underlying principles and democratic practices, which I think
are crucial to a genuine Iraqi democratic state.
The first key area, security and training policy. We are,
at present, in a situation which is essentially United States
and coalition forces leading the counterinsurgency effort with
Iraqi forces only in a very supporting role. General Casey said
in the past that what the Iraqis want to do in the next year is
reverse that. I think that is possible, and I also think that
the exit strategy as outlined by the administration is, at
least at the strategic level, fundamentally sound: Train Iraqi
security forces and have them take over responsibility for
directly dealing with the insurgency so that United States
forces can gradually withdraw. The devil is in the detail,
however. It is the quality, not the quantity, of the forces, as
I have said, which is critical to a realistic transfer.
At present, as Dr. Cordesman has pointed out, the vast
majority of the Iraqi security forces, 127,000 I think is the
number, have not actually been given the required
counterinsurgency or counterterrorism training and therefore do
not have the required capabilities to conduct offensive or even
at times, as we have seen in Mosul and other places, defensive
operations against the insurgents.
Now, I do not imply that there should not be this large
number of Iraqi forces in existence. It is just that they each
have a role and function, as in any society, and not all of
them can actually be thrown out into the front line against the
insurgency.
The assumption of the Pentagon in the early postwar phase
was that there would not be such an intense and deadly
insurgency. So consequently a lot of the plans to train Iraqi
security forces were broad and based on large numbers of
recruits doing very basic training in local policing and also
conventional military operations. Dr. Cordesman is also correct
in saying that the emphasis has clearly shifted to training the
right type of Iraqi security forces with the capabilities to
take over offensive operations from the United States with
minimal support.
I have more detail in my written testimony about the
problems with both the Iraqi police and the Iraqi national
guard training and there is a detailed discussion in that of
the specific training policy for each of the Iraqi forces. The
main point I wish to make here is that, even with the
improvements in the vetting and training process having become
centralized, firstly under General Eaton and now currently
under General Patraeus, the bulk of these forces--that is, the
national guard and the police--will not necessarily have the
capabilities to take on the insurgents even with the training
they get now.
While I was in Baghdad, I have seen as late as May 2004
national guard and police forces, local police forces,
providing perimeter security, even in the Green Zone, outer
perimeter security, and they also performed with distinction in
securing polling centers in the recent election. But that is
what they are trained to do, basic fixed-point security. They
do not have the capabilities to take on the insurgents
offensively. Only the specialized units, police units and army
special forces, which are currently very limited in number, as
Dr. Cordesman has pointed out, have the required capabilities
to take on the insurgents offensively.
I would also like to note that the bulk of Iraqi army
training and capabilities are geared toward conventional
military operations--defending Iraq from external aggression. I
believe that, given the past history of the Iraqi army and its
use as a tool of repression, the United States must be very
careful not to overemphasize the use of the army in internal
security operations.
It was in early 2004 that the Iraqi interim political
leadership and the CPA put in place the policy to raise and
train high-end internal security forces, commonly known as the
Iraqi Civil Intervention Force, an umbrella grouping which
includes several types of specialized police units with this
specialized training, SWAT teams and special police commando
units. I think these are the critical forces, with the
capabilities to take on the insurgents.
They are particularly important, not just because of the
specialized training and skill sets, but the ability to combine
intelligence, law enforcement, and light infantry capabilities.
They are also important in my view in the sense that we can
limit a heavy emphasis on army internal security operations.
So, I think the key to a realistic transfer of security
responsibility, that is Iraqi security forces that can
successfully conduct offensive and defensive counterinsurgency
operations with minimal United States support, rests not only
with building up the Iraqi army special forces, but more
importantly these high-end internal police forces under the
ministry of interior.
As far as I understand, these forces are growing in number.
There are, I think, plans for something like 33 battalions of
these forces to come out of the training pipeline over the next
24 months. But I actually believe a concerted and concentrated
effort must be made in the next 12 months to intensify and
increase the training of these specialized units, particularly
in counterinsurgency and counterterrorism, to ensure a
realistic handover in the next 24 months.
I think it is short of a plan, but specifically an increase
and-or a shift in the allocation of U.S. and coalition training
resources and manpower to the specific co-in and
counterterrorism training of these forces, I think this will
lead to a realistic handover and the consequent withdrawal of
U.S. troops.
The second key area is building the capacity of Iraqi
security institutions and ministries. There is obviously more
to Iraqi security strategy than training forces. A key area
where progress has been made to date and the groundwork laid is
the capacity-building efforts within the newly civilian-led
Iraqi ministry of defense. A good example for the Senators is
the time I spent there conducting interviews and selection of
senior leadership for the ministry of defense, up from the
ministry down through the deputy secretaries and the secretary
and the senior leadership in the ministry. We had to discount
around half of the hundreds of Iraqis that we interviewed for
these positions because they either did not understand or would
not accept the very simple concept of a civilian minister of
defense.
So I do really believe that the training, mentoring, and
educational and technical assistance for this new civilian
service in the ministry of defense and also for the more
troubled ministry of interior is an area that the United States
has made good ground in over the past 2 years, but really needs
to remain committed to, likewise with other coalition partners
such as the U.K. and Australia, which have committed assistance
there.
To the third and last point, the political transition
process and the need for underlying democratic practices to be
instilled in the Iraqi structures. Democracy is not just about
elections, as Dr. Cordesman has pointed out. There are
underlying principles and practices in the security sector
specifically which make democracies work and must be encouraged
in Iraq.
The principles and democratic practices which are specific
to ensuring Iraqi security institutions work in a democratic
state include some of the following, and I want to emphasize
the principle of civilian control over the military, but more
specifically democratic civilian control over the military and,
more broadly, the security forces, so a clear chain of command
up through the operational military, Iraqi military and police
commanders, to the civilian ministers of defense and interior
and of course up to the prime minister and the security
cabinet.
An even distribution of power among the key security
ministries, particularly important to Iraq, so that not one
minister has dominant control over Iraqi forces.
Transparency in both the executive and the national
assembly and a clear separation of the two, particularly in the
need to establish oversight committees in the new national
assembly, something I am sure the Senators here would be very
much behind.
Checks and balances in the national assembly on the use of
force and in the executive on this insofar as such decisions
require cabinet consensus and the approval of the president
always, I think, are critical and they must be adhered to to
ensure the newly formed Iraqi security institutions work in a
democratic state.
The United States does have considerable ability to
influence and encourage the new Iraqi political leadership, but
these principles and practices, some of which have been
established over the past 2 years, need to be respected and
enshrined, and that there is no serious deviation from these
important foundations, because I do believe that whatever
progress is made with the elections that we have just seen,
these will be in jeopardy without the ongoing presence of some
of these democratic practices.
I think the focus of United States policy and continued
United States support in these areas will ensure longer term
success in Iraq and mitigate the need to return to a possibly
failed state in 20 years time. Put simply, during this
political transition process over the next 12 months the
administration really should focus its efforts in supporting
the commitment to these underlying structural foundations and
principles common to all democracies and really stay out of
some of the meddling and internal Iraqi politics and political
personalities.
In conclusion, Mr. Chairman, I think three key points can
be summarized here. One, increasing or shifting the allocation
of resources to training counterinsurgency and counterterrorism
training for Iraqi forces over the next 12 months. That may
include army ranger battalion special training from the United
States being committed to that effort.
Second, continued United States focus on capacity-building
for the Iraqi security institutions, such as the ministry of
defense and the ministry of interior, which back up these
forces and are very important.
Third, United States influence of the political process
should be focused on encouraging and enshrining these
underlying democratic practices and principles I have outlined
within the Iraqi security and political structures.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Khalil follows:]

Prepared Statement of Peter Khalil, Visiting Fellow, Saban Center for
Middle East Policy, the Brookings Institution, Washington, DC

Anthony Cordesman's paper ``Playing the Course: A Strategy for
Reshaping U.S. Policy in Iraq and the Middle East'' presents sound
strategic assessments which can aid U.S. policy towards Iraq. My
agreements with his ideas and a few points of difference are made
apparent in the following analysis and recommendations. Any Iraq
strategy both at the operational and strategic level must push progress
in a combination of political transition, security and economic
reconstruction for it to be successful.
A successful Iraq (exit or victory) strategy aims to achieve two
goals: 1. the speedy return of U.S. troops in the next few years; and
2. the establishment of a free democratic and pluralistic Iraq, secure
and stabilized, able to defend herself from external threats, no longer
a threat to her neighbors nor a haven for terrorists. These do not have
to be mutually exclusive. A weakening and defeat of the insurgency
through a combination of progress of Iraqi security reform, democratic
political transition and economic reconstruction will lead to the
achievement of both.
There are three key areas of U.S. policy over the next 12 months
which can ensure the achievement of these goals:
1. The training of Iraqi security forces and the building up of
their capabilities. The quality, not the quantity, of these forces is
critical in ensuring a realistic transfer of security responsibilities
from U.S. forces to Iraqi forces.
2. The reform and rebuilding of Iraqi security institutions and
ministries, capacity building in those structures and the practice of
underlying principles and democratic practices within those structures
that are crucial to a genuine Iraqi democratic state.
3. The political transition process and the point at which the two
tracks of security reforms and political transition form an important
nexus which the U.S. must help to shape.

1. SECURITY AND TRAINING

At present U.S. and coalition forces are leading the
counterinsurgency effort with Iraqi forces in support. General Casey
has said that ``What the Iraqis want to do in the next year is reverse
that,'' and he has added that ``We're an outside force, and the Iraqis
in some parts of the country see us as an occupation. We need to get
the Iraqis in front.''
The exit strategy concerned with security as outlined by the
administration is, at least at the strategic level, fundamentally
sound: to train Iraqi security forces and have them takeover
responsibility for directly dealing with the insurgency so that U.S.
forces can gradually withdraw. The devil is in the details, however. It
is the quality, not the quantity, of the Iraqi security forces which is
critical to a realistic transfer of security responsibility from U.S.
forces to the Iraqi security forces. At present the vast majority of
these forces (130,000 trained and in uniform) have not been given the
required training and do not have the required capabilities to conduct
offensive (or even defensive) operations against the insurgents.
This is not to imply that there should not be the large numbers of
Iraqi forces which exist. It is just that they each have a role and
function, as in any society, and not all of them can or should be
thrown on the front line of the insurgency.
Problems with both the Iraqi Police and Iraqi National Guard (ING)
can be traced back to the fact that initially, throughout 2003 and
early 2004, much of the training and vetting of recruits for these
services was decentralized. Local U.S. and coalition military
commanders were given the responsibility to raise these units, leading
to a lack of standardization in their training and in uneven vetting of
these recruits across the country. The pressure on the United States
and coalition military to get Iraqi boots on the ground led to many
local police simply being ``reconstituted''--former police officers who
were brought to work without having to go through the required police
academy training. National guardsmen went through minimal levels of
basic training and then were expected to be the bulk of Iraqi forces
facing the insurgents.
To a certain extent, these training and vetting problems have been
rectified. The raising and equipping of Iraqi Police and ING have been
centralized, first under Major General Eaton from spring 2004 until
June 2004 and since then under his successor, Lt. Gen. David Petraus.
Under General Petraus, ING training involves 3 weeks of basic training
and 3-4 weeks of collective training. However, ING capabilities are
still limited to basic tasks such as fixed-point security, route-convoy
security and joint patrolling with coalition troops. The ING performed
these tasks admirably during the January 30 elections, when they were
charged with creating cordon and perimeter security around polling
centers; yet they still require heavy U.S. logistical and combat
support.
Local Iraqi police forces currently complete 8 weeks of training
(or a 3-week refresher course for former officers) in police academies
around Iraq and in Jordan. Still, their capabilities are limited to
local policing duties and ensuring basic law and order. Given their
skill sets, they are unable to combat the insurgency effectively as a
frontline force. It should be noted that even the best-trained Western
police forces would have a great deal of difficulty dealing with such
intense and continuous attacks with RPGs, small-arms fire, and suicide
bombings on their officers and police stations.
In contrast to the ING and the police, the Iraqi Army has had a
centralized recruiting and vetting structure from its inception. As a
result, the Army has attracted a higher quality of recruits who must
undergo thorough and standardized vetting, and the training itself has
been of a higher standard. The basic 8-week army boot camp is
supplemented by additional training for recruits moving into special
forces, such as the Iraqi Intervention Force (IIF).
It should be noted that the bulk of Iraqi Army capabilities are
attuned to conventional military operations, especially defending Iraq
from external aggression. Given the past history of the Iraqi Army,
including its use as a tool of repression against the Iraqi people, and
the propensity for the military to dominate Iraqi politics, the United
States must be very careful not to overemphasize the use of the Iraqi
army in internal security operations. Necessity, however, has required
the building up of the IIP (9 battalions by the end of January 2005) as
the Army's key counterinsurgency wing. This force has proven to be
extremely capable in operations in Samarra and Fallujah in late 2004.
The Iraqi armed forces also has at its disposal two trained battalions:
the 36th Commando Battalion--a special ING battalion put together to
serve as an infantry-type strike force in late 2003, with fighters from
many of the different Iraqi militias--and the Iraqi Counterterrorism
Battalion, with fighters drawn from both the ING and Army units.
The key to a realistic transfer of security responsibility to Iraqi
forces rests not only with these Iraqi Army special forces (such as the
IIF), but more importantly with the building of high-end internal
security forces under the Ministry of Interior. These specialized
national police units are particularly important because of their
specialized training and skill sets and their ability to combine
intelligence, law enforcement, and light infantry capabilities. They
are also important in the sense that a heavy emphasis on Army internal
security operations can be limited as much as possible.
It has taken some time for the building of these internal security
forces to get underway. The assumption of the Pentagon in early 2003
and in the early postwar phase was that there would not be such an
intense and deadly insurgency. Consequently, the initial plans to train
the Iraqi security forces were broad, relying on large numbers of
recruits with very basic training in policing and conventional military
operations. Only in early 2004 did the Iraqi interim Governing Council
and the Coalition Provision Authority put in place a policy to begin
building specialized internal security forces to fight the insurgency.
Since then, the emphasis has clearly shifted to training the right type
of Iraqi security forces with the capabilities to take over offensive
operations from U.S. forces with minimal support.
These high-end internal security forces are commonly known as the
Iraqi Civil Intervention Force, an umbrella grouping that includes
several types of specialized police forces:

The Iraqi Police Service Emergency Response Unit: an elite
270-man team trained to respond to national-level law
enforcement emergencies--essentially a SWAT capability.
The 8th Mechanized Police Brigade (MPB): a paramilitary,
counterinsurgency Iraqi police unit. The MPB will comprise
three battalions.
The Special Police Commando Battalions. The Special Police
Commando Battalions provide the Ministry of Interior with its
strike-force capability. The commandos--which will ultimately
comprise six full battalions--are highly vetted Iraqi officers
and rank-and-file servicemen largely made up of Special Forces
professionals with prior service. \1\
---------------------------------------------------------------------------
\1\ http://www.mnstci.iraq.centcom.mil/facts_troops.htm.

These internal security forces, which are specifically and
intensively trained in counterinsurgency and counterterrorism, are the
key to the transfer of security to Iraqi forces.

2. BUILDING THE CAPACITY OF IRAQI SECURITY INSTITUTIONS AND MINISTRIES

It should be made clear to U.S. policymakers that democracy is not
just about elections, and there is more to the Iraqi security strategy
than training forces. There are underlying principles and practices in
the security sector which make democracies work and must be encouraged
in Iraq. Thus, it is imperative that U.S. policy makers ensure that
fundamental principles inherent in all democratic states are part of
the security and political structures of the future Iraq. The focus of
U.S. policy and continued U.S. support in these areas will ensure
longer term success in Iraq and mitigate the need to return to a failed
Iraq in 20 years' time.
A key area where progress has been made to date and needs to be
continued is capacity building within security institutions, such as
the newly civilian-led Iraqi Ministry of Defense. A functioning and
strengthened civilian-led Iraqi Ministry of Defense (IMoD) is critical
given the past history of civil-military relations in Iraq. During the
Baathist regime, the Baath Party emptied the military of independent
professional officers and replaced them with Baathist ideologues in
uniform who held the key security posts in the cabinet. In turn, this
Baathified military dominated the ministry.
The new IMoD, headed by a civilian Minister of Defense, was
established in April 2004. The United States and its coalition
partners, such as the United Kingdom and Australia, must remain
committed to capacity building, training of civil servants, mentoring,
and technical assistance for the new civilian service in the IMoD. This
is critically important, as the ministry's civil service not only
provides the logistical and administrative support for the new armed
forces, but also articulates and develops the strategic defense policy
for the country under the guidance of the civilian Minister of Defense
and ultimately up to the security cabinet of ministers.
An independent civil service with no political appointees has been
established in the IMoD. The Iraqi Minister of Defense cannot bring
``his people'' into the IMoD. Iraqi civil servants are professional and
objective, dedicated to serving the national interests of Iraq without
fear of losing their jobs with a change of minister. Unfortunately,
Iraq has a predilection for nepotism and corruption, and the Interim
Ministry of Interior was rife with examples of different ministers
appointing cousins, uncles, and other personal favorites to senior
leadership positions. This cannot afford to be replicated in the newly
established IMoD.
There are many critical principles that underlie a democratic
state: the separation of powers, freedom of expression, and a host of
civil and political rights. Principles and democratic practices
specific to ensuring that Iraqi security institutions such as the new
IMoD work in a democratic state include:

The principle of civilian control over the military, but
more specifically democratic civilian control over the
military. This entails a clear chain of command up through the
operational Iraqi military commanders to the civilian Minister
of Defense, the Iraqi Prime Minister, and the security cabinet.
Transparency in both the executive branch and the National
Assembly.
An even distribution of power among the key security
ministries. This is particularly important to Iraq, in order to
assure that no one minister has dominant control over the Iraqi
security forces.
Checks and balances in the National Assembly on the use of
force and in the executive, insofar as such decisions require
cabinet consensus and the approval of the President.
The establishment of oversight committees in the National
Assembly.

These are fundamental principles and practices which are critical
to the long term goals as outlined. They must be adhered to ensure the
newly formed Iraqi security institutions work in a democratic state. A
genuinely free democratic Iraq requires democratic practices and
democratic institutions. The U.S. ability to influence and encourage
the Iraqi political leadership to enshrine these principles and
structures (some which have already been put in place during the past
two years) but also to ensure there is no serious deviation from some
of these important foundations is critical to achieving long-term U.S.
strategic goals in Iraq.
Although these principles and practices may seem like intangibles
in comparison to concrete needs such as training, they may be even more
important. No matter how well the Iraqi security forces are trained and
take over their security responsibilities, the real danger exists that
U.S. policy makers will drop the ball on ensuring the maintenance of
these democratic security structures and practices. The United States
needs to keep its assistance up in ensuring that these institutions and
these democratic practices continue through political transition
process over the next 12 months.

3. THE POLITICAL TRANSITION PROCESS AND THE NEXUS BETWEEN SECURITY
REFORM AND POLITICAL TRANSITION

Put simply, the political transition is one in which the
Administration should focus on those underlying structural foundations
and principles common to all democracies. The United States must ensure
that in the political transition over the next 12 months, including the
drafting of the constitution and the development of Iraqi security and
political institutions, that they encourage the practice of these
principles in governance in the security and political spheres while
essentially foregoing interference in individuals and political
personalities.
The legitimacy of the newly elected National Assembly and the
executive government that is formed will be key to accomplishing the
long-term goal: a free democratic Iraq. Thus, the United States must
resist the temptation to try to control the political process which
will form the new Iraqi government. Certainly, in a general sense the
United States should encourage a Shi'a leadership to include key Sunnis
in the new cabinet. However, overall the United States needs to play
the ball and not the man--in other words, focus on maintaining sound
structural foundations and underlying principles and not supporting
personalities who may be in or out of favor.
A democratically elected Iraqi government in which Sunni, Shiite,
Kurd, Turkoman, Christian, Yazidi, Communist, capitalist, secularist,
and Islamist are all represented may not even be a government the
United States particularly likes--particularly if Sunni ex-Baathists or
radical clerics like Muqtada al-Sadr hold key cabinet posts. But such a
government will be legitimate, with the support of an overwhelming
Iraqi majority, and will serve to hold the country together to the
detriment of the insurgents. As long as this future government does not
attempt to erode the important principles which buttress a pluralistic
democratic state, the United States should not attempt to fiddle with
the internal Iraqi political process--even if it does not like who
wins.

The Chairman. Thank you very much, Mr. Khalil.
I call now upon the distinguished ranking member, Senator
Biden, for his opening statement.

STATEMENT OF HON. JOSEPH R. BIDEN, JR., U.S. SENATOR FROM
DELAWARE

Senator Biden. Thank you very much, Mr. Chairman.
Tony, I am sorry I missed the very beginning of your
statement, but I can assure you quite literally there is not a
thing you have written that I have not read in the last 2
years, and that is not an exaggeration.
As I listened to your statement, General, I think we should
point out for the record, nothing either of you are saying is
new today in terms of what you have been saying from the very
beginning. It is kind of dumbfounding we are here at this point
having to be--reiterating these points.
Mr. Chairman, I want to thank you for having this hearing.
As we have all seen, we obviously have an extremely
distinguished panel. I have already relied a great deal on the
advice of two of our witnesses over the last 2 years in
formulating my own views thus far. So it will not be surprising
for them to hear that I agree with virtually everything they
have had to say.
Sunday's elections were, to state the obvious, a
significant positive tribute to the courage of the Iraqi people
and to the courage of our soldiers and civilians in Iraq. The
images of children dancing in the streets and elderly walking
miles to polling stations despite the obvious danger were
incredibly moving. Given the trauma of the past 2 years, to say
nothing about the past 3 decades, it was encouraging to have
some good news coming out of Iraq.
But, as all of you have pointed out, one election does not
make a democracy or even a stable government make. Whether the
history books look back on Sunday as a transformational event
in Iraq is going to depend on what the Iraqis do and what we do
in the next several months. It seems to me that we have several
very important challenges, some of which you all have
mentioned.
First, in my judgment we have to use our influence to work
the Sunnis back into the constitutional writing process here,
which will define minority rights and protections. Quite
frankly, in my most recent trip to Iraq last month, I got the
sense, from some of the Shias with whom we met that they
understood that, that the Kurds understood that. Now, whether
or not they can translate that understanding to reality remains
to be seen. But it seems to me that is a critical step that has
to be undertaken.
Second, the Iraqi Government, to state the obvious, needs
more capacity. When Senators Lugar and Hagel and I were there a
year and a half ago, right after Saddam's statue went down, we
kept talking about capacity, what we were going to do to
provide the Iraqi people with any capacity.
When the transfer of sovereignty occurred last summer, it
was clear that we transferred sovereignty, but virtually no
capacity. I want to ask you in the question and answer period
more about why it has been we have failed to focus on that and
instead have insisted on this arbitrary number of 127,000
trained Iraqis as if it provided capacity for this government.
Third--and I am summarizing here, Mr. Chairman--we need to
show reconstruction results. I am going to be anecdotal. I was
with my friend from Rhode Island on a recent trip. We met with
a number of people, the same people we met with, I met with, 2
months earlier, 3 months earlier, with Senator Hagel.
General Chiarelli of the First Cav, he was very, very
simple and straightforward. I think he has done a hell of a
job. He said: Look--he showed us Sadr City and he said: This is
my responsibility. Then he showed us HMMV's going down the
streets with sewage up to the hubcaps and piles of garbage
literally 10, 12 feet high in front of the front doors of
homes, not much further away than this rail is from that door.
He said: I talked to the CPA and I have talked to their
successors about what we do about that, and they talk about
$100 million, hundreds of millions of dollars, tertiary
treatment plant.
He said: Give me some PVC, let me run it with Iraqis from
the homes to the Tigris River, drain the swamp. You know, we
have all seen the Powerpoint presentations the military, that
you guys, General, love so much; He then showed us where all
the attacks on his forces had been, where the most
environmentally degrading circumstances existed, where he had,
I think it was--correct me, Chuck or staff, if I am wrong. I
think he said he had 30 million bucks he was able to spend
right away, where he used it.
Then he put another graph right on top and said: Now look
what has happened. CNN 3 or 4 days ago--some of you may have
seen it; I was at Davos and I turned on CNN. They had Chiarelli
walking down a street with Iraqis who were turning in
insurgents because they now had a street built, the garbage
taken away, the sewage diverted, and lights on.
The idea that we have only spent $2.4 billion--not very
well, I might add--out of the 8--as you said, Tony, the good
news and the bad news. The good news is we have only wasted
$2.4 billion. The bad news is we still have this vast bulk of
this reconstruction money we have not used.
So I would like to ask you some more specific questions
about that, but the failure of us being able to use more than
15 percent of the so-called Marshall Plan reconstruction has
not been all because of insurgents. It is not all because it is
too dangerous. It is the method we have chosen as to how to lay
it out.
In my judgment we have to move away from these massive
projects that are costly, slow, susceptible to both the
incompetence of American contractors and the difficulty they
have in dealing with security, as well as not providing any
immediate tangible results for folks in the street.
Fourth, it seems to me we finally have to make Iraq the
world's problem, not just ours. I had the opportunity, Mr.
Chairman, to spend I do not know how much time, but a
considerable amount of time with a few of my colleagues, with
President Chirac. The President, our President, has a unique
opportunity when he heads to Europe now. It is time the
Europeans stop bleeding for the Iraqi people and ante up a
little bit. It is time they get over George Bush. It is time
they get over the election. It is time to get over it. They
love beating up Bush and I believe it has been used as an
excuse, in some cases from their perspective legitimate, to
avoid their own responsibility.
Talking with the French president, he was very specific--it
is not appropriate to lay it out here--very specific about
things he is willing to do relating to training on and off the
scene, relating to involvement in civil society issues. We
should ask, ask. We should give them a way out and into their
responsibilities. I know some of you have mentioned that.
Fifth, it seems to me we have to articulate much more
forcefully what our plan is. We are going to come up and we are
going to have to vote for $80 billion, I say to my colleagues
here. I am prepared to vote for it, but this time I am not
voting for it unless they tell me what they want to do. I am
not looking for a withdrawal date. I am one who has been
calling for more forces up until recently. I have been one who
has been suggesting that we have to do more.
But I want to tell you something. As that old song goes,
what is the plan, Stan? I do not see any evidence, except on
the training side and only in the last 4 to 6 weeks, that there
is any coherent notion about how Iraq fits into our regional
strategy and about how, in fact, we even define what the
insurgency is.
The Secretary of Defense started off calling them dead-
enders and jihadists. Give me a break. They are dead-enders, a
bunch of dead-enders and jihadists. Well, what are they? I want
the administration to tell me what they think they are, so I
have any notion to whether or not there is any maturation in
the thinking of this administration, because otherwise we are
faced with a situation, Dr. Cordesman, in my view that you had
said in your November article which you have updated for this
presentation here, which is that we do not have much better
than a 50-percent chance.
You indicate if we do these things we have a much better
than 50-percent chance. I think we do as well. But I want to
tell you: If there is no change, no change in the thinking of
this administration, significant change in the last 10 months,
we do not have a shot in my view of prevailing. And I am not in
on the game any more, because then I am faced, as we always are
in the Senate, with Hobson's choices by presidents, two bad
choices. The one is, do we continue to drain American blood for
an approach that seems to be, I think, a loser, or has there
been a change in the strategy. And if it is, what is the
strategy? So I want to know what it is as just one Senator.
I also believe, to state the obvious, we have to support
our military, and that relates to their training, their
mission, their rotation schedule, the equipment they are
provided. We can go into that later and I do not want to take
the committee's time since so many of our colleagues are here
now.
I think maybe most importantly, I say to my colleagues more
than the witnesses, we need some straight talk to the American
people here. We need to level with them. I know you are tired
of hearing me saying this, but no foreign policy can be
sustained very long without the informed consent of the
American people, and there has not been informed consent. We
still operate in this fiction that we do not have to put money
for Iraq in the budget, in the regular budget.
I do not know how you guys in good conscience can support
that notion, that it is unknowable what we need. We still talk
about this in terms of what great success we are having. I
recommend any administration official who tells us what great
success we are having to get back in a HMMV with the Senator
from Rhode Island and me and go 50 to 60 miles an hour inside
the Green Zone, with automobiles weaving in and out and while
sitting there, although I did not hear them, six mortar attacks
in broad daylight inside the Green Zone; flying in, making sure
we cannot go anywhere at all except on a helicopter at high
speeds about 100 feet off the ground. Tell me about how much
more security we have. Why do they insist on this fiction that
we have 125,000 trained Iraqis?
So we better level with the American people. There are a
number of questions that are going to have to be answered by
the administration. They will get my continued support if they
try to answer them, but I want to tell you something. We should
use this opportunity, I will say parenthetically, Mr.
President, of voting for money to get a real live strategy
written, stated, articulated by the administration as to what
their plan is, because if it is a repeat of the last 2 years we
are doomed to fail in my humble opinion.
I thank you for allowing me to make this statement, Mr.
Chairman, and I will reserve my questions until after you
question.
The Chairman. Thank you very much, Senator Biden. Let me
just say that, one characteristic of the hearing on both sides,
both the witnesses and the Senators, is that there will be a
lot of straight talk this morning. It is meant to have
oversight, but likewise a constructive purpose. We appreciate
your papers as well as your responses to the questions that we
will ask to try to flesh out what you have said to us.
We have many Senators here. The chair would suggest that we
have a 7-minute question period for our first round, so that we
try to get to as many Senators as possible. I know you, Dr.
Cordesman, must leave us, I understand, at about 11:30; is that
correct?
Dr. Cordesman. I changed the plane until later, Senator, so
I can extend it. Thank you.
The Chairman. I am glad you will be able to stay longer.
That is great.
Now, let me just ask members to be thoughtful about the 7-
minute limit. As always, the chair will try to be liberal and
make sure answers have been given and questions have been
asked. But at the same time, as a courtesy to all of our
members, it would be helpful if we can try to observe the time
limit.
Let me start by asking a question and then ask the three of
you for comments. In the testimony that you have given today
there is a question about definition of the insurgents. Who are
they? To contain or defeat them, calls for careful definition
of the enemy. Likewise, why do they appear to be growing in
number even as a number are killed by our security forces or
the Iraqi security forces.
An assertion has been made that essentially the insurgency
comes because we, that is the United States and our allies, are
perceived as occupiers, and that the end of occupation would
end a rationale for the insurgency. Let me just ask for more
definition of this proposition. Some have suggested that the
insurgency is primarily focused in four of the 18 provinces of
the country. One of the characteristics of those provinces is a
high number of Sunnis. Furthermore, some have suggested that a
number of the insurgents have in mind not only the end of
American occupation, but likewise the end of the Iraqi
democracy experiment. In other words, they would simply like to
take power again, and one way of doing that is, of course, the
elimination of outsiders, ourselves included, but also of those
who are involved in this fledgling experiment, including those
who would be involved in the constitution-building, or at least
the present leaders, to be replaced by those whom the
insurgents would attempt to install by force.
That may be a stretch for 20,000 people, but then no one
knows whether just 20,000 are involved. So I am curious, how do
we have this situation in which, on the one hand, we are
pledged to try to defend the fledgling democracy, the 275
people that will now assemble, the election procedure of a
referendum on their constitutional development, and the
December 15th election of the new officers of the country,
while at the same time providing the training that we have all
talked about today, including certainly much more training? The
people you have identified need to have specific types of
training to be more effective.
How do we go about trying to determine, as Dr. Cordesman
has suggested, the metrics of how well we are doing? Clearly,
in our hearing with Dr. Rice, Senator Biden raised the point
about the 120,000 that are suggested as trained and the
estimates of 12, 14,000, maybe, who really seem to be effective
against an insurgency, or capable of replacing U.S. forces. We
raised the metrics question during that confirmation hearing.
How would we know how that training is coming so that we
can have this dialogue with the Iraqis or with the world as to
our withdrawal, as to how this handover occurs, and thereby
leave behind a group of people who are prepared to defeat
insurgents who may be after them by then and no longer after
us?
Dr. Cordesman, would you begin with your comments on this
broad question?
Dr. Cordesman. Well, Senator, you have hit on, I think, one
of the key questions. Let me say, all of these numbers when you
talk to intelligence people who actually serve in the field
have to be generated as guesstimates. They will tell you, if
you keep asking us to provide an estimate we will provide you
with an estimate. But we do not have a basis for counting. We
do not have a methodology that we can defend. We have to make
rough estimates.
So General Newbold quoted 20,000. I am perfectly happy to
support the figure. I have seen estimates as low as 14,000.
Iraqi officials have talked about 200,000 sympathizers. The
truth is that we do not have an intelligence structure that can
give us precise numbers.
We are talking, too, about a very diverse movement, and I
will concentrate here on the Sunnis. Some 35 groups have
claimed to exist. I think the latest estimate I heard was that
we could confirm the existence of about 18. Some of these have
outside leadership. There are no outside groups per se except
for a relatively small but fairly lethal group that is
responsible for a lot of the suicide bombings.
The most recent estimate for General Casey was that only
1,000 of the insurgents were foreign volunteers, and most of
these foreign volunteers are not trained, experienced people.
They are being recruited locally in Arab countries and funneled
in through primarily Syria, but also to some extent Iran.
When we talk about these movements, they are organized so
there are core cadres of people who do planning and
organization. There seem to be finance and infrastructure
cadres who do not operate, but do provide services. Then you
keep recruiting locally young men, most of them young Sunnis,
in an area where unemployment is put at the 70-percent mark for
this particular age group.
Some of the groups are Islamic. They seem to be relatively
small as pure Islamist extremist groups, but certainly there is
a growing number of Sunni groups that are Islamists there. Some
are Baathists, some are former regime loyalists, many are
local.
So we really need to understand. Why are they growing?
Well, they are growing because many of them are hostile to the
new government. They are hostile to the loss of Sunni power.
They are hostile to the existence of a more democratic
structure in an artificial country where the Sunnis led because
Britain used divide and conquer tactics from the foundation of
Iraq to the present.
Now, when it comes to metrics, the metrics we had in
Vietnam were better than the metrics we have now. We broke them
down locally. We showed what areas could be secured. We showed
what the number of incidents were. We broke the incidents down
by type and we had pattern analysis of what the incidents were
trying to do. We have suppressed that data, although we
initially published it.
Since time has run out, I will try to get back to metrics
on how you can deal with measuring the improvements in the
Iraqi forces later.
The Chairman. Well, thank you, following an example that I
hope we will set, we will not proceed with additional comments
of others. You may want to make those comments as you respond
to other Senators or in a second round.
Senator Biden.
Senator Biden. Thank you. I promise I will adhere to the
same discipline.
I would like to just focus in the 7 minutes on training, if
I may. Dr. Cordesman, through my four trips into Iraq and
regular e-mail contact between the trainers that are there and
my staff, I share the view that has been expressed I think by
all of you, that I think that there has been a bit of, as we
Catholics say, an epiphany of the need for fundamental change
in training. I think General Petraeus is first rate. I think he
is making a genuine effort. I think they are changing the way
in which this is going on. I think they are much more realistic
about what the reality is there.
Without getting us into numbers--and by the way, Dr.
Cordesman, you said up to 16 or 17 thousand. I think that was
the number. I have been using the figure, based on what I have
been able to glean from the folks in the field, somewhere at
the low end of around 5,000, at the high end, 18,000, depending
on how you define their mission and what you define as
capacity.
We all agree that part of, quote, a ``success strategy'' is
giving the capacity to the emerging elected government to not
only govern itself with some legitimacy, but also to be able to
maintain its position with a capacity to have a security force
available to it. How long are we talking about, assuming the
change has taken place as to how to train and what the goals
are as we think it has? I am vastly oversimplifying in the
interest of time. How long are we talking about, assuming
everything went according to plan, we work like heck, we have a
rational new policy?
What are we talking about? Are we talking months? Are we
talking more than a year, Dr. Cordesman? What are we talking
about to be able to give an Iraqi government the capacity to
maintain its own security?
Dr. Cordesman. I think, briefly, Senator, we are talking
some point in 2006. We had only one operational battalion of
the Iraqi army in the spring of 2004. We have been able to
increase that to something like 27 battalions at the end of
this month. But that is training and equipment. Let me stress,
that does not mean they are combat-ready.
Senator Biden. I understand.
Dr. Cordesman. You have to have leaders. You have to have
unit integrity and you have to have experience. We can do that
by putting in U.S. advisers. We can do it by selectively moving
units into the field. But to actually get to combat-ready
forces, that process, once you have trained and equipped, is
going to take you a matter of at least 3 to 4 months.
You also, in terms of equipment, have not equipped these
forces with what they need to survive. What you have are a few
old Soviet APC's, but you do not have a real mechanized
battalion in the field yet. We will have a mechanized brigade
by some time in the summer. But we are talking about three
divisions eventually and that would be some point in 2006.
Senator Biden. Thank you.
General, do you want to add to that? You have done it.
General Newbold. Sir, just a couple of quick comments. As
is obvious to everybody here, we are not training them to
western standards. The real standard is how good are they
against the insurgents. So to some degree it depends on how
quickly we and the Iraqis can destroy the power of the
insurgents, not just military but political as well.
I would argue that we ought to--in certain areas of Iraq--
use moderately trained Iraqis to control the situation, as we
have seen both in the north and in the south of Iraq. We
certainly cannot in western Iraq. But we can incrementally feed
them into the more benign areas with the state of training that
they have right now.
I think it will take until the end of this year to be able
to do that in many areas of Iraq. It will take through next
year, if we overhaul our strategy, before the predominance of
the security mission can be undertaken by the Iraqis. They will
be at a self-generating point, dependent upon the activity of
the insurgency, probably within a year. That does not mean
that----
Senator Biden. No, I understand. By the way, in
communicating with some folks on the ground these last couple
days, on the Iraqi performance. They did perform well in the
election. But what everybody forgets is the United States
secured the perimeter. The United States essentially
established martial law. The United States on election day
actually shut down the country in terms of vehicles, etcetera.
Then within the second perimeter you had the Iraqi army
performing well, and within the interior perimeter you had the
national guard and police performing well.
But absent that outer perimeter, being able to be locked
down, figuratively speaking, by the United States military, no
one should read into what happened on election day the idea
that the Iraqi forces have the capacity. Let me put it another
way. Absent the presence of American forces in Iraq on Sunday,
I do not think the kind of situation that existed would have
been possible.
Well, I can see the light is about to go on. I am going to
come back and ask you about the notion of building an
integrated Iraqi force--I am talking about an army that can
shoot straight, have the proper equipment, be under the control
of a civilian Iraqi government, being in the range of 30 to
40,000 over the next couple years. Is it likely to be
integrated, that is Sunni, Shia, Kurd? What are the problems we
face there?
But I have many more questions, but I will abide by the
yellow light and yield back the last few seconds I have.
The Chairman. Thank you, Senator Biden.
Senator Hagel.

STATEMENT OF HON. CHUCK HAGEL, U.S. SENATOR FROM NEBRASKA

Senator Hagel. Mr. Chairman, thank you.
Gentlemen, thank you for coming before our committee this
morning. You have each made a significant contribution and your
careers attest to that as well.
For the record, General Newbold, I think it would be
helpful if you would tell this committee what you did at the
Pentagon in your last job and how you were involved in the
lead-up to our invasion of Iraq and when you left the Pentagon?
General Newbold. Okay, sir. I became the Director of
Operations for the Joint Chiefs of Staff in August of 2000. The
Director of Operations, as you know, is responsible for
oversight for the employment of our forces around the world and
is the communicator between the Joint Staff and the equivalent
operations that go on in the combatant commanders' realm. I
left that job in November of 2002.
Senator Hagel. 2002.
General Newbold. Yes, sir.
Senator Hagel. So you had a considerable amount of
experience on the inside at the Pentagon as we were preparing
to go into Iraq?
General Newbold. Sir, I had virtual access to every bit of
intelligence. Other than the Presidential daily briefings, I
think I had 100 percent other than that. I participated in all
the planning, all the conduct of operations for Afghanistan and
all the planning for operations for Iraq.
Senator Hagel. My point in asking you to put that on the
record is so that we will all clearly understand that you are
not a very distinguished lieutenant general retired who is
before us today just commenting or speculating. In fact, you
were there and had a very significant responsibility for our
efforts. So thank you for your service.
Let me ask each of you, and because of our time restraints
I would appreciate a brief answer: The issue is Kurdistan. What
in your opinion is the likelihood of the Kurds moving to
establish an independent state? Dr. Cordesman, may I start with
you.
Dr. Cordesman. I think they will only do that, Senator, if
they cannot find a way to protect what they already have in
some form of not necessarily autonomy, but federalism. If there
are compromises, if as it seems this new government remains
inclusive, then I think the Kurds will be more than willing to
stay and will not seek independence, particularly given the
risks of seeking independence and the problems with the Turks.
Senator Hagel. Thank you.
Mr. Khalil.
Mr. Khalil. Thank you, Senator. Having spent many hours and
days with Massoud Barzani and Jalal Talabani, I think I can
summarize their key concerns as: First, political instability--
they do not know what this future government will hold--and
second, security, obviously terrorist attacks in their region
and Irbil and Sulaimaniya and so forth. So until they find out
what the political situation will be, they are committed and
have been on the record to be committed to a federal structure
so long as the autonomy that they have developed over the last
10 years remains. That is a red line for both Barzani and
Talabani. So they are committed to this stage.
The other point I should make is we made great efforts to
include the Kurds in the central governmental structures, in
the security institutions and in the political structures. You
see obviously Barham Salih is the deputy interim prime
minister. The secretary general of the ministry of defense is a
Kurd. One of the four-star generals is a Kurd. There are Kurds
in the Iraqi army, in the security forces.
They feel that they have a place within that central
government. I think they will also have a place, given their
turnout in the elections, a place in the new, newly elected
government as well.
Senator Hagel. Thank you.
General Newbold.
General Newbold. Sir, I think the Kurds have set the
minimum conditions, politically, economically, and culturally,
that they expect to be met. On the economic side, other than
the political--on the economic side, they want access to oil;
and on the cultural side they want to protect what elements
there are of Kurdish culture. As long as those are met, I think
you will hear proclamations and politics about independence,
but I think they will be content to be part of a greater Iraq.
If any of those three or all of those three are endangered, I
think they will probably seek alternatives.
Senator Hagel. Thank you.
Both Dr. Cordesman and General Newbold mentioned in your
testimony on more than one occasion the future of Iraq being
very significantly attached to regional security, the regional
dynamic, which I happen to agree with and I have spoken on that
point over the last few years. Would you each develop that
regional security, regional strategy dynamic, with some
context? What are you referring to when you talk about a
regional strategy? Dr. Cordesman, we will begin with you.
Dr. Cordesman. First, Senator, as I said earlier, we need
to have a strategy that will reassure moderates, people in the
Arab world who want a peace settlement, that we are
aggressively out seeking to create an Arab-Israeli peace
settlement and a settlement between Israel and the
Palestinians. It is not necessary that we compromise or give up
on Israel's security. It is absolutely necessary we be
constantly visible and pushing for the kind of conditions which
were advanced by President Clinton and again at Taba.
Second, we need to reassure people in the region that,
regardless of what happens in Iraq, we will stay in the region,
maintain a security presence, and that they can count on us
being there to support them.
Third, we need to get away from this constant emphasis on
general rhetoric about democracy and have Embassy teams and
practical policies that encourage reform on an evolutionary
basis, working with governments when we can, and working with
reformers in the countries, not working with people from the
outside, who in general have no impact or influence.
Senator Hagel. General Newbold.
General Newbold. Sir, I think we have to understand not
only our goals and have them be crafted realistically, but we
have to understand what the people in the region consider their
fundamental goals and objectives involving security, economic
interests. Again, we view these overwhelmingly in American
perspective through our eyes. The Iranians' role in this, the
Gulf States, and the internal frictions they have among
themselves, their forms of governance, and the
interrelationship of all the Arab states just in their future
is critically important that we understand, and I would submit
that we do not very well.
We need to match our goals and objectives to theirs more
closely and to appreciate what they consider the fundamental
requirement. Most importantly is, as Tony Cordesman has pointed
out, our treatment of the Palestinian-Israeli issue is
perceived to be a factor which undermines our credibility in
all other issues. Unless we are perceived as more evenhanded, I
think we will have trouble throughout the region convincing
people that our goals are objective.
Senator Hagel. Thank you very much.
Mr. Chairman, thank you.
The Chairman. Thank you, Senator Hagel.
Senator Dodd.

STATEMENT OF HON. CHRISTOPHER J. DODD, U.S. SENATOR FROM
CONNECTICUT

Senator Dodd. Thank you, Mr. Chairman. Mr. Chairman, thank
you for holding this hearing. The timing was tremendously
appropriate, to come immediately after the events on Sunday,
and it is tremendously worthwhile to have such competent
witnesses before us.
Mr. Cordesman, let me tell you, your statement here today
is--I hesitate to speak as glowingly about it for fear that
others may not pay as much attention to it. But I want to tell
you, this is about as clear and thoughtful a set of
recommendations as I have seen and I commend you for them.
Let me ask you, just without getting too open-ended, but
obviously I would like to hear how you read the elections. What
should we take from this? If you are being asked to give a
brief analysis of what happened on Sunday and what should we as
Americans read from that and how do we then take that decision
and try and move it forward a bit? I wonder if you might
comment on the elections themselves.
Dr. Cordesman. Well, first, Senator, one of the problems we
have is we do not know how many people turned out. We do not
know who they voted for and we do not know what the people they
voted for are going to decide. But whatever happened, it is
quite clear that very large numbers of Kurds went out and
voted, not simply for a national election, but for a Kurdish
assembly and for local elections. A lot of the tensions and
problems that people feared did not take place, particularly
given the history of Kurdish rivalry.
Sunni parties went out and voted in large numbers. We
probably will never be able to know how many really voted
because one problem is the registration lists are the Oil for
Food list. They are not people who went out to register to vote
and only about 60 percent of the polling places that were
required could actually be put into the field and many did not
open.
But all that said, it is quite clear that the Sunnis not
only went out and voted, they voted for different parties, they
did not vote along some clear theological line, and the party
that was most religious, it is the quietest party that is not
seeking any kind of theocracy. It is seeking a government which
again is based on coalitions. In those areas where Sunnis could
vote, the vote was very, very mixed. But there are indications
that in places like Mosul when people saw it was safe to go out
to vote in Sunni areas they did begin to vote, not in the
numbers required.
The other thing to put this in context is we keep talking
about the Sunnis, but they are at most 20 percent of the
population. More recent estimates put them into the 12- to 15-
percent category. The areas where people could not vote, like
Al-Anbar Province or Nineveh or elsewhere, probably had
something on the order of 7 percent of the population of the
country.
So the election I think, given the conditions, is a much
better tribute or a much better sign of hope than can be
indicated simply by how many people out of the registration
list went to the polls.
Senator Dodd. Dr. Khalil.
Mr. Khalil. Thank you, Senator. All of the Iraqis, whether
they be Sunni, Shia, or Kurd, also voted for local provincial
elections as well as the national assembly. The Kurds, as Dr.
Cordesman pointed out, had the additional vote for the Kurdish
assembly.
He is right that the Sunnis make up around 20 percent of
the population, but they do make up about 99 percent of the
insurgency. The important point about this is that, even though
there was much talk about boycott by the Iraqi Islamic Party, a
more moderate Sunni party, and the Moslem Scholars Association,
the leader of the Iraqi Islamic Party actually said before the
elections that he would not prevent his candidates, who were
still on the slate and still on the ballot, from taking their
seats if they won. So there might still be some Sunni
representation on the assembly.
The other point which is important is as far as bringing
more moderate Sunnis into the political process, I think it is
important that they be made part of the constitutional drafting
process, the Sunni jurists and clerics, and also that the new
cabinet has some Sunni leaders appointed as ministers. Both
Shia leaders have said that they will commit to this. Abdul
Aziz al-Hakim and Jafri have said this. So there is the
potential to bring the Sunnis into the political process and I
think there are some positive signs.
Senator Dodd. General, I want you to comment as well, but I
want to ask you something as well. When I came in you were
talking about the withdrawal or the exit strategy. I do not
have your exact words here, but you said we could leave when
the insurgents allow us to leave. What occurred to me, just for
the sake of discussion, is there a realistic assessment here
that there are certainly significant parts of the insurgency or
elements of the insurgency that would like us to stay for their
own broader political purposes, that having the United States
in Iraq on a daily basis, the informational benefit to them
throughout the Arab world and elsewhere, engaged in sort of a
quagmire, may serve their longer term and deeper interests than
having us leave Iraq?
Is that a fair criticism of the assumption that we can go
when they allow us to go?
General Newbold. Yes, sir. Just on the election very
quickly, I thought it was a wonderful, courageous display by
ordinary Iraqis and it ought to give us hope and it gave them
tremendous hope. There is the potential for it to have a
contagious effect throughout the region. We should not overplay
that, but we ought to try to take advantage of it.
The momentum will slip quickly unless we are effective at
pushing the things that made it possible. The Sunnis will be
the key. They are a minority that believes they have majority
rights and an almost cultural disposition to rule. If the new
government provides them opportunities and gives comfort to
quell their fears, then I think they'll participate and I think
we have some opportunities there.
As far as the exit strategy, my comment of course was to
shift the responsibility to the insurgents so that we shift the
blame if we stay there longer than we would desire, than they
would desire. But I do believe there is a hard-core element,
Islamists, radical Islamists most particularly, who take some
comfort by our presence in Iraq to allow them to increase their
vitriolic statements throughout the world and to attack us in
the place where we are vulnerable.
Senator Dodd. Thank you.
Thank you, Mr. Chairman.
[The prepared statement of Senator Dodd follows:]

Prepared Statement of Senator Christopher J. Dodd

Mr. Chairman, I would like to commend you for holding this
important hearing just two days following elections in Iraq. I would
also like to thank our distinguished panel of witnesses who are here
today to share their thoughts on U.S. policy toward that country and
the greater Middle East. There is no more important issue facing us
than the future of that region, and I look forward to hearing the
expert testimony of all our witnesses, and to engaging in a productive
dialogue. Dr. Cordesman, I would especially like to thank you for the
various items you have submitted for the record. You make some very
important recommendations that I believe the Bush Administration would
do well to heed.
Obviously, it will be some days yet until we know the results of
the Iraqi elections. But I think it is important to say that regardless
of the many challenges we face and any disagreements we may have over
the direction of U.S. foreign policy, the holding of elections in Iraq
was a momentous event for the Iraqi people. But we shouldn't take that
to mean something it doesn't.
The elections are not the end of our task in that country--they are
a beginning. First of all, we will not always have troops there. If the
new Iraqi government requests that the U.S. withdraw its troops, we
should abide by its request. And if it doesn't make this request, we
should still do everything in our power to ensure that we adequately
prepare Iraqis for handling the defense and stability of their country
as quickly as possible.
That means we will have to start being honest about the numbers of
Iraqis currently up to the task of defending and stabilizing their
country. Common sense dictates that if the number of those types of
forces were even close to the figure that Secretary of State Rice
quoted for trained forces generally in that country--120,000, including
50,000 police--then U.S. troops would likely be able to start
withdrawing as we speak. That is obviously not the case.
Simply put, when it comes to the training of Iraqi forces, we have
a long way to go. And we are in desperate need of an effective plan to
get there.
But paying lip service to withdrawal and having a realistic plan to
do so are not one and the same. We can't approach withdrawal from Iraq
in the same haphazard and shortsighted way that we approached the
invasion of that country. We have to have a plan or we could turn a
difficult situation into something much worse. I couldn't agree more
with Dr. Cordesman on this point--that regardless of whether we
withdraw gradually over the next couple of years or if the Iraqi
government asks us to leave in the coming weeks--we must not abandon
the people of that country.
What does that mean? It means that there is more to nation
building--and I think it is safe to call it that--than the use of
military might. Regardless of when we exit, we should be generous with
offers of aid and assistance to the new Iraqi government--even if that
government sometimes takes stands on issues with which we disagree.
We've refused to learn this lesson with respect to democratically
elected governments in our hemisphere, such as Venezuela, and I hope
that we don't make the same mistake with respect to Iraq.
What is needed more than anything else when it comes to nation
building is the partnership of the people in the nation you are trying
to build. To loosely borrow a well-known phrase, the new Iraq needs to
be a country built by Iraqis and for Iraqis. That means using U.S. aid
increasingly to put Iraqis to work in the building of their country.
According to statistics, at least 2 million Iraqis are currently
unemployed. American aid could be used to put them to work in
rebuilding their country's infrastructure. This is the right thing to
do. But more importantly, it would give Iraqis a greater stake in the
success of a democratic Iraq, which is in our mutual interests.
Moreover, U.S. aid should be focused on short term projects, not
long-term lofty ideas. Because the legitimacy of the new Iraqi
government will be based in large part on whether it is able to provide
the basic services that every citizen expects of their government.
However, the subject of this hearing rightly extends beyond U.S.
policy in Iraq and seeks to address the future of our policy throughout
the greater Middle East. Iraq is not the only place where elections
were recently held. In the Palestinian territories too, there is a new
democratically-elected government in power led by Mahmoud Abbas. That
government has not only paid lip service to the need to restart the
Israeli-Palestinian peace process--it has also taken some steps toward
that end. The Israeli government has responded in a positive way to
these steps. But we're at a delicate juncture here. A door is open, and
we do not know how long it will remain so.
I commend Secretary Rice for using the beginning days of her
service as Secretary of State to travel to Israel and the Palestinian
territories and meet with both sides. I hope that her trip will mark
the beginning of a high-level and personal involvement by the Bush
administration to advance the cause of peace between Israelis and
Palestinians.
Another issue that cannot be ignored is that of Iran. It is
obviously in our best interest, as well as in the interest of regional
Middle East security, to prevent Iran from acquiring nuclear weapons.
To that end, the U.S. must do two things.
First, I believe we must work more closely with the Euro-3--
Britain, France, and Germany--to put together a comprehensive strategy
for dealing with Iran's nuclear program that includes both credible
carrots and credible sticks. And second, we must reassure our allies in
the region that our twin commitments to development and security--
especially in the event that Iran achieves nuclear capability--extend
beyond Iraq. Our allies will be more confident in the U.S. commitment
to that region knowing that U.S. interest will not fade as we
eventually disengage from Iraq.
In short, we have our work cut out for us. But the future could
hold great potential if we get our act together with respect to our
policy in the Middle East. Thank you, Mr. Chairman.

The Chairman. Thank you very much, Senator Dodd.
Senator Coleman.

STATEMENT OF HON. NORM COLEMAN, U.S. SENATOR FROM MINNESOTA

Senator Coleman. Thank you, Mr. Chairman.
I want to follow up on the questions about the election. I
had a chance to be in Iraq about 3 weeks ago. We were in Iraq
and Afghanistan, and then went to Brussels and met with the
Secretary General of NATO, met with the new President of the
European Union, President Barroso. Two observations and then a
question.
In Afghanistan, Hamid Karzai talked about--these are his
words--``the paradigm-shifting impact of the election.'' He
talked about the impact that had on the Taliban, that really it
gutted any strength that they had by the fact that people
showed up. He anecdotally told the story of one polling place
in a tribal area where mortar shells were lobbed in. The women
refused to leave the line. They were going to vote. The men
scattered but came back. So he talked about the paradigm-
shifting impact of the election.
On the last comment and then the question. I was struck in
visiting with the NATO ambassadors with the level of pessimism
amongst almost every one of them about what was going to happen
on Sunday in Iraq. It was almost as if they could not conceive
that, in fact, an election, a valid election, would take place.
It just was not going to happen. It did.
So my question is kind of looking to the future. What do
you see? You have done a good job, Dr. Cordesman, of kind of
explaining what happened. Look a little bit to the future. Is
there this potential for this election to be a paradigm-
shifting event? Was it just because of great security that the
insurgents were not able to come forth and do all that they
did? If the insurgents, as Mr. Khalil talked about, are 90
percent Baathists, it is internal then, they are not external
folks, what does the statement that the Iraqis made about
democracy, about voting, what does that do to the insurgency?
Dr. Cordesman. We need to be very careful, Senator, because
the latest estimate I have seen is there were over 100
attempted or actual incidents in the Baghdad area and somewhere
between 260 and 300 attempted incidents in the area outside
Baghdad. It was not as if they were passive. So the insurgents
are not going to go away quickly. As General Newbold and Mr.
Khalil have pointed out, they are a serious issue and a lot of
them are committed.
But they certainly do remain a relative minority, both in
terms of their religion and ethnicity, and that has to be kept
in perspective. Now, where is this going to go? I do not think
you can say that you have seen any turning point here until you
see what the results of the election are. I do not mean the
vote. If the Iraqi parties come together, if as has been
suggested by my colleagues they are inclusive to the Sunnis in
the ministers and in terms of the convention for the
constitution, if they show they can cooperate, retaining the
good ministers--and this is important, continuity--but sharing
power among each other, then this step forward in governance,
combined with the election, will over time, I think, become a
turning point.
But we should not expect that to occur simply because there
is a vote. People have to show they can govern. They have to
show they can make the right political decisions. They have to
show they can be inclusive. If they meet these tests, that is a
turning out.
Senator Coleman. Mr. Khalil.
Mr. Khalil. Thank you, Senator.
I traveled to Ramadi and had a very interesting meeting
with the governor of Al-Anbar Province, the tribal leaders, and
also around a dozen or 15 insurgents, basically ex-military
personnel. These are rational actors, and I am talking about
the ex-Baathists--they are still Baathists--the Saddam
loyalists, the ex-military personnel and the intelligence folk.
They will come to the negotiating table.
It is the extremists, the Islamic extremists, the foreign
jihadists, which you cannot negotiate with. Obviously, with
Zarqawi saying democracy is wicked, that is not a negotiating
point. So if you look at Muqtada Sadr as a template, there is a
potential to bring these guys into the political tent. He laid
down his arms, or the Mahdi army's arms, and thought about
coming into the political process rather than using force, and
there you see reconstruction occurring in Sadr City.
I think this can occur in the Sunni Triangle with some of
these more moderate Sunni resisters, the ex-Saddam security
personnel.
Senator Coleman. General Newbold.
General Newbold. I agree with the comments of my
colleagues. I think it has the potential to be a seminal event.
We need to quickly reinforce what was positive about it and
give concrete evidence of what the Iraqis were looking for. We
need to take some combination of the Sunnis--just a quick
reminder: The Sunni areas in the west of Iraq are not naturally
wealthy areas. There are little resources, little hope out
there, independent of the central government who will sustain
them. The central government needs to indicate that it will
sustain them politically, economically, and culturally.
Senator Coleman. I have a little time. Could you follow up?
Can you give your assessment of the impact and the
opportunities on the international community? I have talked
about the pessimism I saw before the election amongst our
allies. Talk a little bit about the impact of the election on
our allies and how do we seize--if there are opportunities
there, how can we seize them?
Dr. Cordesman. Well, very briefly, Senator, it is already
clear that there is much more positive Arab press and media
coverage as a result of the output of the election. The
coverage was more balanced in some ways than I expected, which
is not to say that it was perfectly objective. A lot of people
who had remarkably pessimistic statements up to the point where
the election was held have begun to either back off or be more
accepting.
But again, I think General Newbold made the point. If we
see a pattern of violence develop over the next week, if we see
the coalitions do not work together, if we see any split from a
major faction, then this temporary boost could be just that. So
is it positive so far? Yes. Is it going to stay positive?
Everything depends on what the actions are.
Senator Coleman. General Newbold, I think we have got a
couple of seconds left. Is there anything you want to add to
that?
General Newbold. Yes, sir. I am not surprised by the
comments you heard at the NATO ministerial level and I think it
was very grudging accord that al-Jazeerah and the other Middle
Eastern outlets gave to the elections. I think that the bias is
unfortunate; not helpful.
Senator Coleman. Thank you.
Thank you, Mr. Chairman.
The Chairman. Well, thank you very much, Senator Coleman.
The chair wishes to announce that a full statement on the
hearing from Senator Dodd will be made a part of the record.
Likewise a full statement by Senator Voinovich, who had to
leave to be involved in another hearing, should be a part of
the record.
[The prepared statement of Senator Voinovich follows:]

Prepared Statement of Senator George Voinovich, U.S. Senator From Ohio

Thank you, Mr. Chairman. I am glad to have the opportunity to be
here with my colleagues on this Committee to continue discussion on
U.S. policy toward Iraq and the greater Middle East. This conversation
is appropriate on the heels of Sunday's historic elections, in which an
estimated eight million Iraqis cast ballots to choose members of a
national assembly, who will have the opportunity to write a new chapter
in the history of a free and democratic Iraq.
The significance of the elections the world witnessed just two days
ago should not be understated. This event marks a major step in efforts
to move toward a new era of peace, stability and democracy in Iraq, and
the Iraqi people are to be commended for their commitment to the
principles of democracy and their perseverance when faced with very
real threats of violence from those who do not wish to see freedom
prevail in Iraq.
We must also recognize the role played by dedicated American men
and women in uniform, who, working with coalition partners and Iraqi
security forces, worked to provide a secure and stable environment so
that the elections could in fact take place. Their service was not
without cost or personal sacrifice.
More than 1,400 American service members have lost their lives
while serving in Iraq. Moreover, it is reported that in addition to an
estimated 35 Iraqis who were tragically killed by suicide bombers who
attacked polling stations on Sunday, a 22-year-old Army medic from
Cincinnati, Ohio, Private First Class James H. Miller IV, lost his life
while providing security for the elections. Last week, four United
States Marines from the State of Ohio were killed when a helicopter
crashed near Iraq's border with Jordan. These men and women have made
the ultimate sacrifice not only in order to promote a free, democratic
and prosperous future for the people of Iraq and the greater Middle
East, but also to protect the national security interests of the United
States.
As our witnesses will discuss, it is essential that the U.S. policy
makers constantly re-examine strategies to bring lasting peace to Iraq.
We owe it to the Iraqi people and to our men and women in uniform to
ensure that we move forward with a solid plan, doing all that we can to
empower Iraqis so that they are able to provide for their own security
and stability as soon as possible. This is not an easy task, which
makes our discussion this morning even more important.
I would like to join the Chairman and Ranking Member in welcoming
our distinguished witnesses this morning: Dr. Anthony Cordesman of the
Center for Strategic and International Studies (CSIS); Lieutenant
General Gregory Newbold, USMC (Ret.) of the Potomac Institute for
Policy Studies and GlobeSecNine; and Mr. Peter Khalil, who is a
Visiting Fellow at the Brookings Institution.
Thank you. I look forward to your testimony.

The Chairman. Senator Feingold.

STATEMENT OF HON. RUSSELL D. FEINGOLD, U.S. SENATOR FROM
WISCONSIN

Senator Feingold. Thank you, Mr. Chairman. I thank you and
Senator Biden for holding this hearing. Like many Americans and
Iraqis and people around the world, I was deeply moved by the
courage of the Iraqi men and women who went to the polls to
participate in Sunday's election and to make their voices heard
in determining the future of their country. Iraqi's election
was unquestionably an inspiring event.
I do have, of course, a series of very serious continuing
concerns that I have outlined briefly in an opening statement
that I would ask to be put in the record if I could.
The Chairman. It will be put in the record in full.
Senator Feingold. Given the limited time, Dr. Cordesman, I
would like to go on to a point you mentioned in your testimony.
You underscore the need for clear statements from the President
and the Secretary of State that help refute the sort of key
conspiracy theories that poison our relations and undercut the
legitimacy of the Iraqi government.
Among the statements you call for is one clearly stating
that we will not exploit Iraqi oil wealth in any way and that
we will shift our aid funds to Iraq control, insisting only on
sound accountability measures. As I consider these
recommendations, my thoughts turn to the report that the
Special Inspector General for Iraqi Reconstruction issued on
Sunday. This is an office that I fought hard to make sure would
exist and now this report indicates that the Coalition
Provisional Authority failed to impose adequate controls on
nearly $9 billion that was distributed to various Iraqi
ministries during the period prior to the transfer of
sovereignty late last June.
I find this extraordinarily disturbing. The $8.8 billion in
question was Iraqi money, proceeds from oil sales and
repatriated funds, that the United States as the occupying
authority was responsible for administering. But today we
simply cannot account for what happened to these funds. This
kind of mismanagement is a gift to those forces who want the
world, and particularly the Muslim world, to mistakenly believe
that the United States is a corrupt and imperialistic power.
In my view, this is not just an oversight failure. It is a
policy failure, with the potential to help the very forces that
wish to do us harm. How will Iraqis and others in the region
understand this failure? In light of the inability of the CPA
to account for what happened to this Iraqi money, how likely is
it that the nascent Iraqi government could provide meaningful
accountability for U.S. taxpayer dollars if they were given the
kind of control over the reconstruction budget that you
actually have advocated?
Dr. Cordesman. Senator, the argument always in the field is
we are too busy today doing things to account for all of these
expenditures. The problem, as you pointed out, is tomorrow
always comes and you are then judged by how well you accounted
for them.
I think that these figures are at least somewhat excusable,
simply because of the pressures, the uncertainties, the
reprogramming. But it should not have been that difficult to
maintain a modern accounting system. This is not the kind of
cash flow problem where you have to get down to individual
dollars and cents. These are massive expenditures.
What I find a lot more disturbing is when I read the
reporting that comes out weekly as to what we are doing with
the money now. We have reporting on electricity which is the
amount of power generated, not the amount of power distributed.
Often the reporting on the electricity generated is the
theoretical capacity, not the amount actually delivered. We
have reporting on the oil sector, which is a critical earning
area, the oil sector indicates we not only are not coming close
to meeting our goal, we do not have significant stocks to deal
in the area with the winter.
More than that, I look at the latest figures on expenditure
on the oil program and you allocated $3.6 billion to help
renovate the oil sector in this $18.4 billion tranche and they
spent all of--let us see. Let me correct that. They spent all
of $123 million of that money to date. You look down the list,
there is 15 percent of the money disbursed on electricity,
which does not mean completions. We spent 15 percent on trying
to improve governance. We spent something like 5 percent of the
money that was allocated on health care and 7 percent of the
money on water. For those of us who do believe in the private
sector, we spent about 9 percent on private sector development.
When I look down the list of what people claim is done, it
is just one list after another of a project started. Nobody
says whether the project survived. Nobody says whether the
project can ever be used. We have massive projects like water
plants north of Basra that cannot feed the system, so even if
they are not sabotaged it does not matter.
What bothers me is not that there is an accounting problem.
What bothers me is this incredibly powerful tool is not being
used to support Iraq, is not being used to fight insurgency, is
not being used to support the government. I think any soldier
or commander in the field will tell you that dollars are as
important as bullets, and we are getting plenty of bullets and
we are not spending the dollars.
Senator Feingold. Thank you, doctor. You note that United
States success in Iraq is heavily dependent on two things, the
emergence of a government that Iraqis see as legitimate and
which can effectively govern and the ability to train Iraqi
military and security forces that can largely replace United
States forces.
It seems to me that that will become increasingly difficult
for Iraqis seeking to broaden their political power base. It is
going to be hard for them to avoid publicly rejecting the U.S.
presence in the country and publicly rejecting any kind of
collaboration with the United States. So in a way their
political imperatives would lead them in this direction even if
these leaders recognize that Iraqi's security forces are ill-
prepared to provide security without international assistance.
So I am concerned that one of your conditions might, of
course, clash with the other, that Iraqis seeking political
legitimacy may be unable to support a United States presence
for long enough to train Iraqi forces. I would like your
thoughts on that.
Dr. Cordesman. Senator, there were several parties that
went into this election initially talking about having a fairly
rapid U.S. exit. Both of them changed their positions before
the elections were held. We do not have a major party out there
that participated in the election that is calling for any kind
of rapid or precipitous U.S. withdrawal.
What they are calling for is creating Iraqi forces as soon
as possible which can replace us, which I think is exactly what
we want. So certainly there will be plenty of people in the
insurgency who do not like us there, but at least as yet none
of the major lists that participated in the election do not see
the need to keep us until their own forces are ready.
Senator Feingold. Thank you, Mr. Chairman.
[The prepared statement of Senator Feingold follows:]

Prepared Statement of Senator Russ Feingold

I thank Chairman Lugar and Senator Biden for holding this important
hearing today, and I thank all of our witnesses for taking the time to
be here to help the Committee think through the very serious challenges
and the high stakes that confront our policy in Iraq and the broader
Middle Eastern region today.
Like many Americans, Iraqis, and people around the world, I was
deeply moved by the courage of the Iraqi men and women who went to the
polls to participate in Sunday's elections and to make their voices
heard in determining the future of their country. Iraq's election was,
unquestionably, an inspiring event.
But while I commend the Iraqis, and the brave servicemen and women
who helped to make the conditions for elections possible, common sense
also tells me that Iraqi elections are not a silver bullet for
resolving ongoing instability in Iraq, and celebrating these elections
is no substitute for articulating and implementing a clear, efficient
plan for handing off responsibility for Iraq's security to the Iraqis
themselves and bringing American troops home.
Our troops on the ground have been performing courageously--
sometimes even in the inexcusable absence of adequate equipment,
support, and mission-appropriate training. They deserve better policy.
American taxpayers have been asked to contribute hundreds of billions
of dollars to this effort--and the Administration has failed to budget
responsibly for these costs. The next generation of Americans is going
to get stuck with the bill, and they deserve better policy. All
Americans have a real, urgent stake in prevailing in the fight against
terrorism, in denying terrorists new recruits and shoring up a global
coalition to hunt down and eliminate terrorist networks. But Iraq has
become the new premier training ground for terrorists, and our
international standing has been dramatically weakened by our policies
there. America's national security deserves better policy.
We need a strategic plan, not lofty rhetoric. We need a clearly
defined and realistic mission, not a sweeping set of abstract
commitments. And we need a concrete timetable for achieving clear
goals, not vague policies that wander from objective to objective with
no end in sight. So I look forward to this hearing, and hope that soon
we will hear from the Administration about how, precisely, they intend
to proceed.

The Chairman. Thank you, Senator Feingold.
Senator Chafee.

STATEMENT OF HON. LINCOLN CHAFEE, U.S. SENATOR FROM RHODE
ISLAND

Senator Chafee. Thank you, Mr. Chairman.
Welcome, gentlemen. Senator Biden mentioned Dr. Cordesman's
November paper and I see that in that paper you talk about
advocating a regional strategy, and I know Senator Hagel
touched on that while I was gone. In particular you talked
about being more flexible with Iran. Maybe you could add to
that and illuminate on how we can be more flexible with Iran?
Dr. Cordesman. It is odd, Senator, that ``containment'' was
a word that became so unpopular and which in retrospect in the
case of Iraq does not necessarily look all that bad. In the
case of Iran, I think the challenges are much worse than they
were in the case of Iraq. We are not talking about a simple
dictator, nor are we talking about a broken military force. We
are talking about a more cohesive country which has its own
political turmoil.
I think the key here is in many ways containment. It is to
work with the Europeans. It is to put pressure on, but work
with, the International Atomic Energy Agency to see if we can
block proliferation. I cannot make you any promises, but I do
not believe that any effort to rush into military threats or
military options is the way that we can deal with the problem
of proliferation in Iran.
Similarly, I am afraid that Iran is moving toward a less
democratic, more conservative, more isolationist,
traditionalist political structure, and the coming presidential
elections will cement the problems that occurred in the Majlis,
when you essentially would not let the more moderate candidates
even run, much less be elected. But it is still possible to
have dialogue with Iranians. It is still possible to talk to
people. It is possible to make it clear that our objectives are
not ones which challenge Iran's basic national interests. These
are ways we can, at least, hope that we can move toward a more
open dialog and a better situation in the future.
But I think it is absolutely clear that we cannot permit
transfers of technology for proliferation if we can block them.
We cannot allow Iran to operate in other countries in
asymmetric or terrorist operations if we can put pressure on
them to halt it. We must do all we can to block the transfer of
arms.
The one caution I would give is that American sanctions
against Iran have been almost totally ineffective and as Iran
has learned how to make better oil deals we are watching those
sanctions essentially become almost purposeless. We need to
take a very hard look at that aspect of our policy and see if
there is not some way to work with countries rather than put
out sanctions which no longer impede them.
Senator Chafee. What would be a good venue for dialogue?
How would we start that?
Dr. Cordesman. Unfortunately, Senator, I think a lot of
that--I have been in many second track dialogues with Iranians
and it was always very interesting and I learned a great deal.
The end reaction every time, however, is we have a long list of
things we would like you to do, but if you did them our
internal politics prevent us from actually moving forward.
Those dialogues over time have shown that the people who
advocate dialogue in Iran are progressively more cautious and
more frightened of the consequences of being in them.
We still have to try. We have to meet with them in second
track meetings wherever we can. But I think one of the great
tools we have here is to work with the Europeans, who have been
allies here and cooperated with us in trying to block
proliferation. It is to make use of countries which can talk to
Iran and do not have the same history and communicate wherever
we can a positive message, that if Iran will back away from the
policies that divide us, none of which really serve its
ultimate interests, we are ready to have an official dialogue,
to deal with Iran in economic terms, to have the kind of
relations we should have.
Senator Chafee. Who of the Europeans have the best
relations with the Iranians, the ruling government that exists
in Iran now, which European or a number of them?
Dr. Cordesman. I think often we are talking about some of
the smaller countries, like Switzerland, who have more
continuity, talk to the people in Iran. Germany certainly has
worked hard at this issue. Britain has tried. Unfortunately,
Britain has found, as have others, that when you go beyond
dialogue to actually set policies you often provoke reactions
among the Iranians which make it difficult.
But one of the problems we have is these countries,
Senator, are virtually all talking to the Khatemi faction. They
are talking to the people who will not be there when this
President leaves office. We do not even know if the more
pragmatic traditionalists, like the Rafsanjani faction, will be
represented in large numbers. If they are, then the Europeans
will be able to talk to them. But it does seem to vary by
country and on a given day the country that seems to favor Iran
the most has the best relations. It is a very troubled,
difficult situation.
Senator Chafee. Would any of the other two guests like to
add anything?
General Newbold. Just very quickly, Senator. I think Iran
is a schizophrenic society and has to be dealt with to some
degree that way. That is, it reminds me of when I was Director
of Operations, Joint Chiefs of Staff, our path toward Iraq was
becoming obvious. I suggested that we look at Iraq and those
things that would undermine Saddam Hussein and those things
that would reinforce his power. A clear analysis there, a
simple analysis, would show that many of the things we were
doing, in fact, reinforced the power of Saddam Hussein.
In a like way with Iran, if we are bellicose, if we are too
threatening, we reinforce the radicals and we undermine the
people that might be predisposed to align with us.
Senator Chafee. Thank you.
The Chairman. Thank you very much, Senator Chafee.
Senator Boxer.

STATEMENT OF HON. BARBARA BOXER, U.S. SENATOR FROM CALIFORNIA

Senator Boxer. Thanks, Mr. Chairman.
I want to thank the panel. You have just been so
interesting, I think, for all of us. I really appreciate your
being here and extending your time.
Secretary of State Rice said after the election, she said
the election signals a new day for Iraq. I agree with that, but
I think it also should signal a new day for America and our
policy toward Iraq. Of course, for me that is what I am
grappling with, how do we take this good news and how do we put
a light at the end of the exit tunnel. And I know ``exit'' has
suddenly become a somehow charged word. I am not wedded to the
word, but an end, an end of so much money, an end of so many
troops, etcetera, an end of being a target to the insurgents,
all of that.
Friday I visited with the families of marines stationed at
Camp Pendleton and this particular marine--First Marine
Expeditionary Force has taken a huge hit. I want to report that
their families are just extraordinary and I think we all know
that. General, you know this. They are just extraordinary. They
are willing to make even more sacrifices. If they are asked to
by their Commander in Chief, they will absolutely do it.
So I think it is up to us to show our appreciation to them,
not only by doing what I am very excited to see is going to
happen, I think, in the State of the Union, a great increase in
some of the benefits, which members of both parties want to see
happen along with the President, but also I do think we need a
light. We need to light a candle here so we have some goal.
General, you actually used the word ``goal,'' and I think
in many ways for me you did light a candle to our exit,
although you said we should set a goal of being completely out
of Iraq in 2 years. Is that correct? That is what you said?
Yes.
I assume you believe that should be done gradually, is that
correct?
General Newbold. I am sorry, ma'am?
Senator Boxer. I assume you believe that should be done
gradually. Okay, so it seems to me if we were just to, just for
the sake of discussion, adopt that goal, we then have to take
your next statement, which is disheartening--that one was
heartening--and that was that you said that you don't see an
end in sight of this insurgency. Those were your words.
So if we have this strategy, this goal to be out in 2
years, doing it gradually, but yet there is no end in sight to
this insurgency, clearly the training of Iraqi forces, which I
have to say--Senator Biden has just been on this for so long,
and Senator Lugar as well, in hearing after hearing after
hearing. It looks like this goal that you set can only be met
if we can transfer authority to the Iraqis themselves, because
there is, quote, ``no end in sight of this insurgency.''
So I guess it is frustrating for us because, first, we
cannot seem to find out exactly how many troops are trained,
and there are reasons for that. But Senator Biden asked
Secretary Rice a number of questions. I am not going to go over
the give and take, but at the end of the day Senator Biden
said--and Joe, if I misstate this please tell me--that you felt
if they were properly trained that they could replace our
people one on one, if they were properly trained. To which she
replied: I really do not think so; I do not think they can do
all of that which American forces do.
Then she said: But in some ways, she said, they will be
better because--and I am liberally quoting her now; she said--
they really know the neighborhood. They know better than our
people who are these insurgents.
So with that, I want to ask a question. If Secretary Rice--
first, I want to know if you agree that we cannot make this one
to one transfer, because if we could that would begin a
drawdown and it could begin to gradually bring our forces home
in direct relationship to the training of their forces. So I
want to ask you about that.
But I also, Dr. Cordesman, wanted to ask you: If Secretary
Rice is correct and the Iraqis know the neighborhood better,
why is it that we do not believe them when they are telling us,
the Iraqi intelligence, that they may have 30,000 fighters and
up to 200,000 supporters? You alluded to it, but you did not
seem to give it too much credence.
So those are those two questions I have.
General Newbold. Senator, on the direct swap one for one, I
do not believe that we can swap the units and the individuals
one for one, but I am also not sure we need to. Again, my
recommendation is that we regionalize our approach and we use
the newly trained Iraqi forces, who are clearly not up to
United States standards right now, but use them in the more
benign areas, freeing up some of our forces--coalition forces,
United States forces--to move to the more active and violent
ones, and over time as the Iraqi forces become better trained
and become stronger quantitatively, then they can replace us in
those areas.
So a one for one swap is not required in order to achieve
what we want to to withdraw our forces.
Dr. Cordesman. Senator, part of the problem I have with all
of these numbers, as I said earlier, is intelligence, if it is
not based on facts, is intelligence based on guesswork. We do
not have a way of measuring the number of insurgents in any
meaningful way. If you want to make a conservative guess, you
push the number down. If you want to make a pessimistic guess,
you push it up.
I think that the Iraqi Minister of Defense and other Iraqi
officials rounded the numbers off because they first wanted to
make the point that we are dealing with considerable sympathy
for the insurgency. That is where the 200,000 came from. Where
the 30,000 came from and whether it is better than 14,000 gets
back to whether you define core insurgents, people who are
members of organized cells, fighters, part-time sympathizers.
Now, we broke those out in Vietnam. What we have today in
Iraq is virtually meaningless reports coming out by way of
public data, and to the extent I understand it, one reason they
are meaningless is we have not standardized the way we break
out the assessment of insurgents in given areas, and our
numbers are bad even when we pull together the intelligence
estimates. But I have not seen the classified data, I cannot
assure you of that.
Senator Boxer. Well, Mr. Chairman, if I could just say, I
have had meetings with the military, our military, trying to
find out the size of this. It is frustrating since our coming
home depends on the size of this insurgency.
I just wondered if I could simply ask one quick question
and that would be the end of me.
The Chairman. Very well.
Senator Boxer. That is, what do you think was the role of
the Grand Ayatollah Sistani in the turnout?
Dr. Cordesman. I think it was extremely positive. He has
pushed for elections. He has pushed hard. But he has pushed for
coalitions. He has been a quietist. He has not pushed for any
kind of theocratic rule. It is clear that he sees a Shiite Iraq
as an Iraq that has to have Sunnis and Kurds in it, rather than
something that is a Shiite enclave. So I think his role was
consistently positive.
Senator Boxer. Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Boxer.
Senator Martinez.

STATEMENT OF HON. MEL MARTINEZ, U.S. SENATOR FROM FLORIDA

Senator Martinez. Mr. Chairman, thank you very much and
thank you for holding this hearing. I think it is extremely
timely. I too share in the delight of seeing these pictures on
television of people voting, standing in line, daring the
insurgents and daring the negative forces who do not believe in
democracy. So I am, for one, extremely pleased with where we
are today and I am delighted we have a chance to hear from
these gentlemen, and thank you all for coming.
Dr. Cordesman, I wanted to ask if you might lay out for me
one of the things I heard in following up on the euphoric day
of the election about not losing the momentum. I know we have
talked in several ways about that issue, but I would like to
know from each of you if you could detail out a perhaps one,
two, three approach of how to maintain the momentum, but then
again how to build on that momentum to achieve the goal that we
seek, which is obviously to empower an Iraqi Government to
handle their own affairs and yet allow us to have a timely
withdrawal.
Dr. Cordesman. The key to the momentum, Senator, I think is
ultimately Iraqi. We need to encourage them--and here my
colleagues have made the same points--to be inclusive, to bring
in the Sunnis, to try to defuse the insurgency by showing those
Sunnis who will be part of the country that they have a future
in spite of the economic and other problems they face.
We need to encourage the kind of settlement with the Kurds,
the type of federalism that will stabilize the structure. We
need to work with the new ministries and new parties and make
it clear we will support them and that we accept their
sovereignty. One of the visible signs we have to have is the
fact that we are not proconsuls, but we are working with these
new elected officials as truly sovereign officials.
I have already suggested one key tool would be to move
toward transferring control of the aid funds and the aid
projects to them. I think that would give a lot of momentum.
Another would be to announce a plan for training and equipping
Iraqi forces that showed Iraqis that we will indeed give them
the quality, the capability, to take over as many of the
missions as possible, as soon as possible.
I think, as I mentioned earlier, it would be equally
valuable if we understood that a Presidential or a Secretary of
State policy statement outlining our goals for Iraq and for
this government, that dealt with each of the major conspiracy
theories, which was actually set forward openly by the
President--and General Newbold made a key point. It is
incredible to me that American officials cannot understand you
do not communicate policy in press conferences. Nothing you say
in a press conference is a policy statement.
If you have a policy toward Iraq, the President or the
Secretary of State--and those are the only two officials--have
to announce it openly, clearly, and in a specific speech. This
to me is just one proof of what General Newbold said, that our
public diplomacy is often as much an enemy as the insurgents.
Senator Martinez. Mr. Khalil.
Mr. Khalil. Thank you, Senator. On how to maintain
momentum, I agree with Dr. Cordesman. The political process has
to be inclusive of the Sunnis clearly, involve them in the
drafting of the constitution and get them involved in the new
cabinet.
Second, economic reconstruction needs to be targeted in the
Sunni Triangle towns and cities. I think, in reference to what
Senator Biden said earlier, smaller projects, Iraqi companies,
and contractors being involved in this is absolutely critical.
Third, obviously a focus on training, counterinsurgency
training, for the Iraqi forces to ensure a realistic handover.
Just on the insurgency a quick point. They do not all see
eye to eye in the insurgency. When we spoke to the Fallujan
tribal leaders, for example, they referred to the foreign
Islamists as ``the destroyers'' and they are happy to get rid
of them. But they could not move against what they called the
``sons of the tribe,'' who were Iraqi ex-military personnel. So
there is some room for maneuver here.
They have been coordinating their efforts because they have
the same short-term goals of derailing the political process,
but in the long term they certainly don't have the same agenda,
and you can start to break up that insurgency by bringing some
of the ex-Saddamists and ex-Baathists, the military personnel,
into the political process.
Senator Martinez. General.
General Newbold. Senator, in order to ensure we do not lose
the momentum I would do four things that match my colleagues'
statements. First, we have to have a quick display, visible
evidence that there is an increased transfer of power and
authority to Iraqis in the political, economic, and military
realms. It has to be that visible. It has to be articulated and
displayed, so the Iraqis believe that the situation is
changing.
Number two, I have already spoken to the accommodation of
the Sunnis in which they are made more comfortable that they
will be taken care of politically and economically.
Number three, I agree very strongly with the Presidential
statement. I think it needs to be done, not just for Iraq but
for the world.
Finally, at the end of the day the Iraqis need to believe
not just the elections, but the follow-on actions that
constitute forming their democracy, bring them hope for the
future. That in and of itself, that hope will sustain them
until such time as they completely govern the country and we
withdraw.
Senator Martinez. Thank you.
One other area I wanted to follow up on, Dr. Cordesman,
your mention of transferring the management of the aid or the
funds to the Iraqis, which I can certainly understand would be
an important consideration. I notice your criticism of those
funds that appear to not have been properly accounted for. As
someone who had a little bit of experience in running a multi-
billion dollar department of government that often had a
difficult time tracking funds that were transferred to others
to spend, I wonder if the transferring to the Iraqis would not
then also be accompanied by those kinds of problems in
accountability.
I am not suggesting by that we should not do it. But you
know, we used to work an awful lot at HUD on what we called
capacity-building and it seems like in order to be able to
spend the dollars you almost have to invest dollars so the
folks know how to spend them, and then the very complicated
process of accounting for how you spend them. So in other
words, there is a whole bureaucracy that has to be in place.
There has to be, frankly, information technology, a lot of
things have to happen in order for us to apply our standard to
how they account for the funds that we might transfer.
Would you delve into those? Maybe too much into the weeds,
but I really wonder how we would do that.
Dr. Cordesman. Senator, very briefly, I do not believe that
you can transfer money to Iraq without seeing significant
corruption. This is a society which has inherited a kleptocracy
and people are desperate for money. But I think we need to be
very careful about what our goals here are. It is not to create
a very large cadre of Iraqi CPA's, and here I mean accountants.
It is to get the money into Iraqi hands where, as my colleagues
have said, it is going to buy stability, it is going to help
deal with the Sunnis, it is going to compensate the Kurds, who,
incidentally, have lost the money they have through smuggling
and Oil for Food and there is a potential stability problem
there.
How do you measure success? It is not by accounting. It is
by projects out in the field. It is by things accomplished. It
is by having U.S. people observe and see that the projects
actually get implemented. It is by giving people the equivalent
of things like the CERP program so our commanders still retain
the money that they can give again, so dollars can be used
instead of bullets.
If we lose 10 to 15 percent to corruption, so what? We are
losing more than that now simply to buy mercenaries to protect
projects that do not work. I think this is a fundamentally
different issue. Our problem is not accounting; it is winning.
Senator Martinez. I agree with you and I appreciate my time
is up, but I do want to point out that I agree with that
approach. I think we have to get the money out there. I was
just hearing, on the other hand, Ambassador Bremer being blamed
at times for perhaps putting out too much money early on that
has not been as fully accounted as it should be. I do not think
we can apply our accounting standards to what needs to be done
on the field, and I appreciate your point of view on that.
Thank you.
Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Martinez.
I will just comment without asking you to reply further.
The answer you gave, Dr. Cordesman, that the Kurds have lost
money from the smuggling and the Oil for Food program, is an
interesting footnote for the current investigation of Oil for
Food. I make that point simply because, as we get into the
weeds of that, our own policy, or lack of it, is likely to come
to the fore.
Senator Nelson.

STATEMENT OF HON. BILL NELSON, U.S. SENATOR FROM FLORIDA

Senator Nelson. Thank you, Mr. Chairman.
Speaking of Ambassador Bremer. I would like to ask you all
about my colleague from Florida. He countermanded a Floridian,
General Garner, who was put in charge of Iraq to begin with.
General Garner wanted the Iraqi army to virtually stay intact.
Bremer came in and said dismantle it. I would like your
comments on that.
Dr. Cordesman. Senator, I think that in reality--and I
overflew quite a number of those concerns when I was in Iraq
and I am sure that my colleague has seen a lot more of them--it
was gone. There were elements of one corps left intact, not a
particularly good one, up in the northeast. The army was a
conscript-oriented force, the parts that we would probably have
wanted to have retrained. It left, came back, looted, and left
again.
One of our basic problems in training the Iraqi army was
just creating new barracks and facilities once we decided to do
it. I think that the decision that was wrong, was having
watched it disband, we had no plan to create a credible force
to deal with security either in terms of the police, the
security forces, or the military. We talked about a token force
to be on the borders, policemen who would operate basically in
a more secure environment than you can find a mile away from
Capitol Hill, and security forces whose main purpose was not to
be security forces.
That was a decision which simply should not have been made.
There should have been from the start the understanding of how
difficult the problems would be. Moreover, in disbanding it
took a long time to decide that it is not a good idea to have
several hundred thousand young men wandering around with no
income and no job and some of the best trained people in the
country with no meaningful pension. And even then we could not
get the money to them for a matter of months, and this is a
cash economy. Most Iraqis cannot go to the bank or cash a
check.
So I think the problems here were not the fabled disbanding
of the Iraqi army, which we did with some 18,000 precision-
guided munitions and quite a lot of tanks. It was the
aftermath.
Senator Nelson. General, in your statement you said, and I
am quoting: ``We had a poor to nonexistent plan for the post-
invasion phase.'' Then you go on to say: ``At the national
level we''--meaning the United States--``are deluding ourselves
in many key ways. Examples are the public assessments of the
state of training of the Iraqi forces and police, the
underlying nature of, and prospects for, the insurgency, the
degree to which we truly have an international coalition in
support, and in the strategy for adequately addressing the root
causes of terrorism, radicalism, and instability in the
region.''
I have felt, along with our colleagues here, our leaders in
the committee, that the United States has not stepped out
vigorously enough to get other nations of the world to help us
in the plan for the occupation and in the training of Iraqis.
So we have gotten all of these countries, in Europe and others,
that have hardened their positions publicly, saying they will
not come in and help us with the occupation.
But is there not the indication that these countries have
told us that they will help with the training of the Iraqi army
and the Iraqi police? And, what are your observations about the
United States unwillingness to step out and really implore
these nations, including Arab nations in the region, to help us
with training? And, if they would, how do you see that helping
us to accelerate the training of the Iraqi forces?
General Newbold. Senator, I think it is critical that we
get our international partners to participate more fully. Two
reasons: Quantitatively, and that is simply we could use more
trainers; and also symbolically, to broaden this from a United
States occupation to an international effort to rebuild Iraq.
Senator Biden, I know, has worked closely to try to gain more
from our traditional allies.
There are two faults really there. Frankly, my experience
in my dealings was that sometimes we dealt with them arrogantly
and the reaction of some of our allies was predictable. On the
other hand, some of our allies were the ones that would not
support Secretary Powell's attempts at smart sanctions and the
failure of smart sanctions led down a path toward what became
the invasion of Iraq and the power of the people that wanted
to, the power within our government, that wanted to do that.
So on the part of the allies, they have been recalcitrant,
reluctant, and halting, and that is unfortunate. Iraq is
important not just for the United States, not just for the
region, but for the world. As Senator Biden pointed out, I
think we need to redouble our efforts, perhaps swallow a little
bit of our pride. But we also need to expect some of our
traditional allies to be more accommodating, and if they are
not, it will stick with us for some time, I am afraid.
Dr. Cordesman. Senator, could I make just one comment. You
referenced ``Arab training.'' One thing we need to be very
careful about: If we take the figures that are normally used,
80 percent of this country is not Sunni Arab. The neighbor to
the east is Iran. It is very difficult to bring in outside
people for training, for training missions, beyond what we have
already gotten from Jordan, and Jordan is conducting these
training missions at the cost of potentially serious political
instability.
So I think if we are going to solve this problem it has to
be through us, Europe, and outsiders, not through people in the
region.
Senator Nelson. Which outsiders?
Dr. Cordesman. Hopefully Europeans. But I will tell you
honestly, I do believe the administration and people in the
field have made every effort to try to bring more trainers in
from Europe. The truth is that European countries, that are not
present, are not going to send training people in there.
Remember, what we need is interoperability, leadership, and
units that can have quality and function with unit integrity.
So simply pushing people through a training facility,
particularly if it has a different language and different
customs and patterns, can almost be counterproductive, not a
help.
Senator Nelson. Well, is this to say then that we are
doomed?
Dr. Cordesman. No, sir. It is to say that I think General
Luck's strategy of putting more United States and hopefully
British forces into Iraqi units, concentrating on stiffening
and training them while they are in service to supplement the
programs General Petraeus has under way, is a good solution in
the way of moving toward the quality we need. But if we wait
for the Europeans, we are going to be in very serious trouble,
and it is important to note that both in the Balkans and in
Afghanistan the Europeans have only delivered about 30 percent
of the police forces they pledged and those were problems where
there was a great deal more support than we have in Iraq.
Senator Nelson. So we are looking at a force of 120,000
U.S. troops for at least a couple of years?
Dr. Cordesman. No, sir. I think that what you are looking
at is, if you move to the point where you go from two or three
experienced battalions to the point where the 27 battalions in
the army now in existence are actually in the field and
experienced by the middle of the year, if you see the national
guard phased out and the better manpower used in the army, as
General Newbold has said, and I think my colleague as well, you
can by late 2005 and through 2006 see a steady drawdown in
United States forces and see competent Iraqi units replace
ours.
But to do that they not only need training, they need
standardized equipment, they need standardized rules of
engagement, they need to be fully interoperable, and they need
to be units which can cooperate with each other in the field.
It is nice to have NATO units, it is nice to have units trained
outside, it is helpful as a sign of solidarity, but when we
stress so much interoperability and standardization in NATO, we
have to remember it is a lot more important in putting together
a force like this in a country that faces an ongoing
insurgency.
Mr. Khalil. Mr. Chairman, could I add a quick comment to
the Senator's question? Just on the issue of outside help,
Senator, I did travel a fair bit to some of the Arab countries
in the region to ask them for support and assistance in some of
the training. I traveled with General Eaton and other CPA
leadership. Many of them wanted to help because it was in their
strategic interest to see a stabilized Iraq, but many did so
very privately. They did not want it made public because of
domestic pressures, and there is some assistance from some of
these Arab states that is not out there as far as public
information.
On the issue of the Iraqi army, it was dissolved and many
of the conscripts, around 400,000 of the conscripts, the
largest share were not going to come back. I think the real
problem was in the immediate postwar phase, knowing that there
was going to be this security vacuum, that there was not an
increase in U.S. and coalition troops to fill that vacuum and
to provide basic law and order.
There was a grace period where Iraqis did view the
coalition forces as liberators, but that quickly eroded because
of the lack of basic law and order and the looting that
occurred.
Senator Nelson. Thank you.
The Chairman. Thank you very much, Senator Nelson.
Let the record show that Senator Obama has been here from
the beginning of the hearing. I appreciate your patience,
Senator. We are delighted that you are here as our 11th
questioner. We have very good participation today by the
committee. Senator Obama.
Senator Obama. Thank you very much, Mr. Chairman.
I want to thank the guests. It has been very informative,
so I very much appreciate their presence and patience with us.
This weekend I think we saw an enormous glimmer of hope in what
has been a very difficult situation, and I think that it is a
testimony to the Iraqi people. It is also a testimony to our
military, which, as you indicated, General, have performed
oftentimes despite bad policies to provide the kinds of
security that facilitated the election. So I am very proud of
our troops.
I have mentioned before, Illinois I think, would be the
third or fourth largest coalition partner if it was a country.
So I am just grateful that we reached the point that we did
this weekend. We have a lot of work to do.
A couple of questions I have. One, I am just going to pick
up off the training issue that Senator Nelson and certainly
Senator Biden have been pursuing vigorously. I was out of the
room. I understood that I think someone asked, and my staff
indicated that it might have been you, Dr. Cordesman or General
Newbold, that you did not think that we needed a one-to-one
replacement of American troops to Iraqi security forces. I was
not sure whether you were able to elaborate on that, but do you
have an estimate at this stage in terms of a reasonable minimum
number of security personnel that are fully trained and
equipped in the way that you have discussed to allow us then to
phase out and let them take on the full responsibility of
security in their country?
Dr. Cordesman. No, Senator; I do not. I think the reasons
are this. First, this is an ongoing battle. We do not know what
the insurgency will be over time. As we have all said, a lot of
this depends on the politics and to some extent the aid
policies that are pursued. More inclusive policies could reduce
the size of the Sunni threat. If you get the Islamists, the
outsiders, the extreme units, more isolated, you need far less
troops, both American and Iraqi.
If you make mistakes, the reverse is going to be true. We
do not have a core understanding at this point of what units in
the Iraqi military structure we can build on. I am looking at a
report dated 21st of January from the U.S. Embassy and it
refers to special operations forces, a counterterrorist force,
and a commando battalion as having conducted independent
operations. That is a very limited number of men.
But you have got 27 battalions in the field. If you build
up to solid brigades and the insurgency goes down, then the
Iraqi forces can replace us more quickly. If the insurgency
goes up and the Iraqi forces remain weak, then one-to-one
ratios become almost theoretical. It has been pointed out that
police can operate in much of this country if the country is
secure and the police are properly deployed, trained, and
equipped.
But the fact is that today, out of 55,000 supposedly
trained Iraqi police forces, about half do not have real
training and you have something on the order of 13 battalions
out of that force--that is somewhere around 8,000 police--with
the core capability to deal with significant threats.
On January 6th they folded the national guard in--and I
will leave that to General Newbold or to my other colleague--
into the army. That had 68 battalions in the national guard,
which sounds incredibly impressive, except maybe two to three
of them could actually function because this was the old
Facilities Protection Service.
What we desperately need is a clear plan to create a
balanced, integrated approach to strengthening Iraqi forces,
one that Iraqis can see, that you in the Congress can see, and
that the world can see. But for us to sit here and say we can
give you these numbers under these conditions, we simply do not
have the kind of information. That is one of the reasons why
our efforts are being given so little credibility in much of
the region.
Senator Obama. That is a good point, so let me follow that
up, and any of you can respond to this. But where does that
plan for security force development and training, where does
that get articulated? Now that we have had these elections,
although the job of the assembly is primarily to draft this
constitution, is that still primarily our function in
consultation with them? Who announces it? How do we track it?
Part of my interest is figuring out how, on an ongoing
basis, we are going to be able to evaluate the progress that is
made.
Dr. Cordesman. Well, in a practical way, Senator, first, we
do not know if the Minister of Defense or the Minister of the
Interior will stay. The last time we had considerable
turbulence and lost 3 months simply because the Ministers
changed. The Minister of Defense in the old government did not
get along well with the Minister of the Interior and got along
even less well with the Minister of Finance.
I would suggest that in practice the best way to approach
this would be to have the people actually in the field--General
Petraeus, General Sanchez, General Casey--propose an integrated
plan which would include the police and security forces with
the military to the Iraqi government, so they would have a
clear plan to work from rather than ask them to do something
they will not be able to do for months, but give them the
sovereign right to make the key decisions.
I would make that plan clear and public so people could see
what our intentions were and that we were really stepping up to
the job with the mix of equipment, training, leadership, and
advisory presence that is really needed.
Senator Obama. General, Mr. Khalil, do you want to add
anything to that?
General Newbold. Real quickly, over the last 6 weeks the
United States military in Iraq through Central Command has
developed actually quite a good security plan. You could argue
it is a bit later than the need, but----
Senator Obama. It is a year late.
General Newbold. But it is a pretty good plan. My most
important point would be that that is a security plan and,
unless articulated into a broader plan that shows much more
energy and imagination in the economic, political, and
informational realm, then we will become more efficient without
becoming more effective in Iraq.
Senator Obama. Mr. Khalil.
Mr. Khalil. Thank you, Senator. Just very quickly also, I
think the plan also has to emphasize shifting the focus of
training and training resources on the counterinsurgency forces
that can really take over responsibility, so increasing police
trainers, increasing army ranger training personnel, even FBI
trainers in some cases, and not just from the United States,
from other coalition partners, I think is imperative, even to
the point where you might want to think about not going ahead
with the full 68 battalions of the National Guard. I think they
are currently at around 40 battalions or 45 battalions, and
shift those resources to training counterinsurgency forces. I
think that is a critical element.
Senator Obama. Mr. Chairman, I know I am out of time, but
maybe if I could just have one last follow-up question and then
I can turn it over to you and Senator Biden.
Shifting gears a little bit, but it picks up on your last
point there, General. That is, it is our task as the U.S.
Government to articulate our policies. Dr. Cordesman, you, I
think, laid out what I find a very persuasive suggestion, that
we specifically, unequivocally, in a policy statement as
opposed to in an ad hoc fashion debunk some of the conspiracies
that may be--conspiracy theories that may be out there with
respect to our presence.
I thought all those are suggestions that I hope this
administration pays attention to. I am wondering whether we
should rightly expect a well-articulated exit strategy as part
of that broader statement, because when Dr. Rice was here I
recognized this administration's reluctance to put a firm
timetable. On the other hand, it strikes me that, particularly
given some of your comments, General, about the fact that our
presence there may actually inhibit some of the political
developments that we want to see happen, that this now may be
the time post-election where we stake out a position,
recognizing that there may be some flexibility involved, but
that we say very clearly, here is what we anticipate doing on
the security front, on the economic front, on the political
front, and that it would actually enhance our ability to
execute over the next year or two.
So I wanted to see if what you talked about, doctor, was
inclusive of a broader exit strategy or you were restricting
your comments to those five or six points that you thought
needed to be made.
Dr. Cordesman. The problem I have with exit strategies
become so confused with simply leaving as distinguished from
strategy.
Senator Obama. Let me interrupt then just to say, I have
been very clear and I think the majority, the strong majority
of this committee, has been clear that we want also a success
strategy and not simply a cut-and-run strategy. So I asked the
question in that context.
Dr. Cordesman. I think it is exactly as General Newbold has
said, I think frankly we have all said. It should not just be a
military strategy. It should be an economic strategy. It should
be a political strategy. It should be a clear statement of
American objectives. And it should be quite clear to the Iraqis
in the world that at the end of this, when Iraq is able to have
a government that stands on its own, when it has military
forces that, at most, require a United States advisory
presence, that when its economy has taken the benefits of the
aid that is needed, we will be out of Iraq except for whatever
very limited remnant is needed and we will have no bases, we
will make no effort to exploit the situation, our objectives
will be to create the kind of Iraq which can stand on its own,
deal with its own problems, and remain hopefully pluralistic
and federalistic.
The only caution I would give you, Senator, is I do not
believe we should set some calendar. If a calendar is to be
proposed it should be proposed by the Iraqis, first, because it
is their choice to make and, second, because I become
frightened that the minute you put a date down and for any
reason you cannot make the economic program work, the military
program takes more time, there is some kind of political
division that is not a crisis but difficult, and you cannot
meet that deadline, all of a sudden your credibility comes into
question and, more than that, as you move toward the deadline
the insurgents are going to try to find every fault line they
can to make that deadline impractical and unworkable.
Senator Obama. Could you argue that that was the same
argument that was being made about the election? I guess what I
am wondering is whether just creating some sense of urgency
actually then accelerates activity and shapes and channels and
focuses people's attentions in ways that are useful and makes
it less likely that we would drift and continue failed policies
when we know that we are going to have to make this thing work
in a time certain.
Dr. Cordesman. There is a difference between, I think,
putting out a plan that shows the urgency we have in economic
aid and in creating effective military forces and in setting
deadlines for withdrawal. Do not forget, Senator, we have two
more deadlines just this year, the constitutional election and
then an election at the end of the year. We are going to be
moving very, very rapidly there.
I think the best thing to do is not to set deadlines for
withdrawal, but to set very clear milestones for practical U.S.
action. One obvious area is to make the aid program work.
Another is to get effective Iraqi forces on line. Those give
the kinds of urgency I think we need without potentially
trapping us.
The Chairman. Thank you very much, Senator Obama.
We will have a second round of questioning now. We promise
not to hold you indefinitely through your lunch hour, but we
will allow 10 minutes for our second round.
I will commence by raising a question just pragmatically.
We on this committee and you today as witnesses have found a
number of deficiencies in terms of our planning and execution
of whatever we were doing in the past. But pragmatically, what
is your assessment of how we are doing now? For example,
Ambassador Negroponte went to Iraq at midyear to stand up a
very large Embassy. We estimated, at least at the time of our
hearings, that there would be maybe 700 employees in that
Embassy, maybe more than that, for that matter, with a number
of Iraqis employed in various capacities.
Ambassador Negroponte has been in operation now for several
months of service there. You have cited Generals Petraeus,
Casey, and Sanchez who are now in our military leadership
capacity there. I raise this question because frequently as we
all talk about this we point out that these things happened and
that they did not work out particularly well. But then, as
opposed to simply condemning the whole efforts therefore, we
are all in favor of making things work out well now, playing
the ball where it lies and moving ahead.
How well are we doing with the current leadership that we
have in the country? Or should the question be broader? Does it
include the President, the Secretaries of Defense and State? In
other words, can you give some assessment of how we are doing?
Dr. Cordesman. Senator, as I said in my testimony, I see
significant improvements taking place in the area. I think that
just talking to people, the relationships between the Embassy
and the military, the inter-agency cooperation, is far better
than it was a year ago.
I think there is the feeling that Ambassador Negroponte has
created an effective team on the civil side. You have several
other Ambassadors, all of which have a very high reputation.
You do have a problem. The Embassy, for reasons which we should
have thought about harder, was put in the wrong place and the
Green Zone is not the place to have an Embassy. You have people
too concentrated in the Embassy. One of the complaints I hear
from the military is they need civilians to assist them in a
lot of the missions they have and those people are not going
out into the field, I think often more because they are not
allowed to than because of any reluctance, although there were
recruiting problems in getting that Embassy staffed with many
of the sort of people at the lower and mid-level.
So I think you do see a more powerful team, and certainly
in the field you have people, I think, that can implement a
policy effectively. My greatest concern there would be twofold.
One is continuity, because I am very much afraid we are going
to rotate people yet again in a society where having people
stay is absolutely critical. A 1-year tour is almost a recipe
for difficulty, if not failure.
The other is I do not know if we have a meaningful
problem--a plan, rather, for dealing with this Embassy. I am
afraid we have a very expensive building going up in the Green
Zone, rather than one which is being moved out into areas at a
reasonable size and cost to meet the future need and reduce the
security profile. I would want to have a very clear picture of
exactly why we are doing this, because I often get the
impression we have people tripping over each other in that
Embassy rather than being functional as we go down the level.
But in general, when you ask how we are doing, we do not
have a viable aid plan, we do not have a public broad plan for
making the Iraqi forces ready and capable, we do not have a
clearly articulated plan for supporting governance, and we do
not have a series of public statements from the President or
Secretary of State which deal with the issues which are of
great concern, rightly or wrongly, conspiracy theories, to many
Iraqis. Those are four areas that have got to be fixed as soon
as possible.
The Chairman. Let me then follow through this way. Before
the military action occurred, this committee had hearings with
regard to the planning that we felt would be required following
military victory. One of the more discouraging hearings was one
in which we asked for testimony from the Department of Defense
and it was not forthcoming. So we were led to speculate as to
what was occurring with the 150 persons reportedly back in the
Pentagon interdepartmental, presumably thinking about what we
were going to do. But it was never clearly articulated by
anyone in the administration. We had some witnesses who
likewise aided our speculation and a good number of people who
offered suggestions of what probably should be in the plan,
some of them specialists on Iraq from think tanks in this
country and on some occasions actual Iraqis who had some
experience with their own country.
Now, I mention that because it is conceivable, as I have
reflected back, that, audacious as it may seem, perhaps this
committee, aided by some of our expert witnesses and others,
might have drafted a plan or some plans. Not that we are
supplanting the Commander in Chief or the Department of Defense
or State or anyone else, but maybe for sake of argument there
was, at least, some cohesive thought, as opposed to our
commenting again and again that there was not much of a plan
and that we were not hearing from anybody and therefore our
oversight was somewhat frustrated.
Maybe our responsibility was a little bit broader. This is
one reason why we are having this hearing today, to try to
think, building upon what has been, I believe, a very important
moment with the election, however one wants to describe what
that means and what it means in the future: What do we do now?
You have suggested, all three of you, the need for a plan
or plans. You have just outlined about four plans, Dr.
Cordesman, that you felt were required. Maybe there are more.
What if, just for sake of argument, this committee said, we
really do not see the administration's plans and so as a result
we are going to suggest some plans ourselves? Not to be
provocative or overstepping our bounds, but nevertheless we
just think somebody needs to be thinking about these things.
Is it conceivable that this might stimulate those
responsible at various levels in the administration, the
military, Ambassador Negroponte, whoever, to say, okay, but you
have got it wrong, this is really what we ought to do? Would
this sort of tease out of the system the plans that might occur
and that, absent our being this bold, might not happen for a
while?
Do any of you have any thoughts or guidance to our
committee along those lines?
Senator Biden. Our collective staff behind us are rolling
their eyes.
I think you are dead right, but anyway go on.
The Chairman. Notwithstanding rolling of eyes.
Dr. Cordesman. I am sure your loyal staff can have such a
plan within the next 4 days.
More seriously, I think we have to do something. This is
the first day of February. It is an obvious statement, but we
are now down to 11 months in 2005. We have a constitution which
to be made work there has to be as much support to federalism
as we can possibly give by way of tangible plans between now
and the late spring. We need to be ready to have an election
where people fully believe in the future by the end of this
year.
Those plans should exist in every area. They do not have to
be my plan and I am sure each of the colleagues would agree.
But it is very, very discouraging that what we have today is no
plan in every important area, no plan that can convince the
Iraqis, no plan that can convince the Congress, no plan that
can win the support of the American people or the world.
One way or another, that plan should exist. I do not care
what it takes to force it to the surface. It should exist.
The Chairman. Let me just comment quickly that this
committee did believe that we ought to be engaged in some type
of permanent organization for nation-building or
reconstruction, as I think it is now called at the State
Department. We proceeded to have a plan for this. Immediately
the State Department and other people in the administration
said: Well, we are already behind the scenes doing a lot of
this and so we really do not want you to pass a bill mandating
such; it has to happen administratively.
So, in fairness, we heard Secretary Rice testifying the
other day about quite a considerable effort going on in this
area, which is a 180 change from the thought, say of 4 years
ago, that we are just not engaged in nation-building, never
intend to be. But clearly we are. The State Department actually
has some people thinking about this and doing it.
This is why I raise this suggestion, that from time to time
people say, well, this is not your province. In fact, behind
the scenes: You do not know what you are talking about; we are
actually doing these things. But I hope that is the case, for
the same reason that you have suggested, Dr. Cordesman, because
the plans are not apparent and they are probably very necessary
for all the reasons you have given.
I would just conclude by saying specifically that you have
raised a very important question that this committee probably
should be seized with, and that is the Embassy building, the
location and so forth. You are testifying that putting it in
the Green Zone is not a very good idea. We are about to
appropriate money, as I understand, as part of an $80 billion
supplemental for Iraq and Afghanistan to build an Embassy.
Some would say, well, of course it is there. That is the
only conceivable place you could protect all these people. In
other words, as Senator Biden has described his travels,
currently in Iraq this is a pretty dangerous place for all of
our folks to be going. So some would say, no wonder you do not
have many volunteers, this is not exactly the best kind of
duty. So you, at least, ought to hunker down, provide some
security, build the Embassy there.
Likewise, public diplomacy is a topic that we have explored
to a fair degree. We held one hearing after another. But we
always keep coming up with the fact that whatever we are doing
simply misses the mark. Now, surely in this whole country there
are some persons of sufficient intelligence who could formulate
a plan that is better than what we have, as opposed to our
holding hearings pointing out that whatever we have done is
ineffective, as one person after another leaves the
administration having had a go at it for 6 months or more.
This is why I query the idea of somebody having a try. Our
staffs are very good at it, but plagiarizing broadly from your
papers and testimony today and from others who have testified
before us, we may now have some good ideas.
Senator Biden.
Senator Biden. I would like to follow up on that, Mr.
Chairman. I know this is a strange, a strange turn of events. I
think that we are sitting here as loyal Americans trying very
hard to support an administration that finds itself in a very
difficult spot, and trying to, at least speaking for myself and
based on the struggle you have just seen my colleague go
through here, trying to not overstep our bounds, understanding
the constitutional limitations on the role of the Senate and
the Senate Foreign Relations Committee.
But I now regret in retrospect not having taken the
documents we produced here back, even in the bad old days when
I was chairman straight through to the follow-on and
amplification of the effort when my friend became chairman,
before the war. In hearings going back to the summer of 2002,
the nature of the problem we were going to face was laid out in
exquisite and excruciating detail, as if--I have press
occasionally approach me and say, well, all right, you say this
now. I say: No, no, no, no, we are not saying this now. We said
this a month ago, 3 months ago, 5 months ago, 7 months ago, a
year ago, 2 years ago.
What I am afraid I am doing again, in a public admission
here, is, to use the phrase for the third time to this
committee, engaging in what Samuel Johnson said people engage
in who consider second marriages. That is the triumph of hope
over experience. I am afraid I am engaging in that again.
Let me get right to it here. The truth of the matter is
this is still a divided administration. As much as we state
just authoritatively that we have no intention of having a
permanent military base here, that is not my understanding of
what is still being debated within this administration. The
reason why no one from this administration has said, in my
view, we have no intention of having a permanent military base,
is there are still powerful voices, not the President, powerful
voices in this administration who want a permanent base.
I recently got back from the World Economic Forum. Every
major player in the region in what they call bilateral meetings
came up to me and said: Are you trying to have a permanent
military base there? You know, sometimes paranoia is justified.
The reason why I would respectfully suggest many of the obvious
questions and plans you lay out that should be on the table
now, are not on the table is, there is still disagreement, not
among our uniformed military in my observation, General, thus
far, but with the civilians over there, the civilians over
there.
Now, maybe I am wrong, but why in the Lord's name would the
Secretary-designee, now Secretary of State, sit before us and
say without equivocation, followed on by every civilian leader
in this administration, no, we have 125,000 folks trained,
knowing full well what was meant by ``trained''? Why would they
say that, except that I do not think they are on the same page
yet.
Now, I realize this is mildly heretical, but I do not get
the sense they are on the same page regionally. Do any of you--
this is a rhetorical question. Do any of you think that the
administration has a position on Iran, yet? If it does, I would
like you to secretly tell me. I am not being a wise guy. I am
not being a wise guy here. They have not resolved their
positions.
We sit here and say we need a regional plan. My lord. They
are in disagreement in this administration on what to do about
the Palestinian election, whether or not to move to the road
map immediately, whether or not to sit back and twiddle our
thumbs, whether or not to get engaged. We are divided on
whether or not we are going to join the Europeans in an attempt
to actually try to reach an accommodation, at least test the
possibility of an accommodation with the Iranians, or whether
we are going to sit back and stay out of the deal.
So I do not know. I think we are all kind of engaging in
this notion of a triumph of hope over experience. I have yet to
see--and if it exists, I pray they come forward with it; maybe
the beginning of the outlines will occur in the State of the
Union. And I am not being political. I think when I said this 4
years ago about how divided this administration was, everybody
thought I was being political. This is the single most divided
administration of the seven Presidents I have served with.
Absolutely like a San Andreas Fault ran down the center of this
administration, or ran down somewhere in this administration.
I tell you what, I am not sure, notwithstanding Powell's
exodus, notwithstanding some of the changes that have taken
place, that there is a resolution of the fundamental underlying
questions we all say has to be dealt with. A regional strategy;
how can you have a regional strategy if you do not have a
bilateral strategy, a strategy on a bilateral issue of Iran-
United States? How can you have a regional strategy if I have
yet to hear an articulation of what our Mideast policy is now?
I have yet to hear it privately, publicly.
On the central issues that we are going to allay the
concerns of the Iraqi people, I would like to have them allayed
internally. I would like the President to say: We guarantee you
there will be no permanent American base in Iraq, period. That
is so easy to say. Why has he not said it? It is not that he is
not a bright guy. It is not that he does not understand the
consequences of that. I believe they have not made up their
mind.
So it leads me to the following question. I have been
implying as I look back on it to my constituencies and to my
colleagues and to my own caucus in a partisan sense that the
administration has got it now, because I constantly am pointing
out General Petraeus's efforts, General Luck, what he is about
to recommend, and so on, and that is all progress. But I do not
get any sense--Mr. Khalil, I quoted you in the hearing. The
response I got was--they continue to talk about, when you hear
the President speak, the jihadists. I am constantly saying I
have not heard a single military person tell me that that makes
up more than 10 percent of our problem in terms of the
insurgency. Yet, when the President speaks he talks about if we
do not fight them in Baghdad, we are going to fight them in
Boston. Give me a break. The election is over.
I hear talk about the inability to articulate our position
on Iran, in the Middle East. So where is the regional plan? I
hear the economic plan. I do not see any evidence--it may
exist. I do not see any evidence, doctor, that this
administration has made at the Presidential level a decision
that we are fundamentally going to change our approach on the
distribution of the remaining roughly $16 billion in
reconstruction funds.
Lastly, what concerns me almost as much as anything, I do
not get the sense that at the Presidential level, the Secretary
of State, President, Secretary of Defense, the Vice President's
office, that there is a recognition that this is a tribal
society and that the core constituencies are tribal and
clerical. They are not the sort of generic Shia, Sunni, Kurd.
May I remind everybody, which you guys already know in spades,
what prompted a trip, occasionally on the floorboards of an
automobile, in 2002 by Senator Hagel and me to Irbil was, guess
what, we wanted to hear firsthand that Barzani was not going to
kill Talabani and Talabani was not going to kill Barzani. That
was only 2\1/2\ years ago.
But I see nothing to indicate to me that at the policy
level of this administration there is a recognition of any of
these fundamental points relating to regional policy, relating
to the distribution of reconstruction moneys. What do you hear
when you ask the Secretary of Defense why there is not more
reconstruction? I will say in advance, if the Secretary is
listening, I am paraphrasing the best of my understanding of
your position; Mr. Secretary: The reason why it is not going on
is totally a consequence of the insurgency. That is the only
reason nothing is being done; the insurgency. We have no
progress on the economic front because of the insurgency.
Obviously that is an impediment. But my observation, that
is not the primary problem. It is a plan. When are we going to
move from Brown and Root--and I am not beating up on Brown and
Root. I am not pulling the Democratic stuff about that. When
are we going to move from they are the solution to all our
problems to the idea that you pointed out, Mr. Khalil, for some
time: You got to get in the neighborhoods, you got to get down
to specific things.
So that is a reflection of my intense frustration, which
leads me to my question: Do you think the administration
realizes how fundamentally they need to change their policy of
the past 2 years?
Dr. Cordesman. I see a hint, Senator, but there are no
secrets in Washington and there certainly is no such thing as a
secret strategy that has to be implemented on the interagency
basis. As Senator Lugar pointed out, that strategy is
absolutely vital. It needs to be public, it needs to be
understood here, in Iraq, and in the world, and it is not.
If it exists, there is no conceivable reason not to make it
public, to articulate it, and to provide it in detail. If it
does not exist, we have, depending on whether you take us
seriously, at most 23 months to make this work, and we do not
have time not to force the issue.
I would just say one remark in conclusion. I had as one of
my assignments, a very long time ago writing for the Secretary
of Defense, an assessment of why the collapse took place in
Vietnam, why the ARVN could not defend itself, and why the Viet
Cong dominated so quickly. That report vanished into the hands
of the OSD historian and was never seen again, but it is not a
report that I would like to write in the future about Iraq.
Senator Biden. General.
General Newbold. Senator, I have absolutely no reason to
believe that this administration will change the process that
resulted in this mess to begin with. I continue to have close
friends in every building that is central to this and have long
discussions with them, no disagreements. I do not believe the
things that we propose in here, or the chairman has articulated
about what we need for the future, are going to change.
Senator Biden. Mr. Khalil.
Mr. Khalil. Senator, the way it works--and I have viewed
this firsthand as both a participant and an observer--is a
bottom-up, trickle-up effect almost. The people in the field,
the military, the officers, the enlisted, the civilian
personnel, based on trial and error get things right and it
sort of trickles up, higher up if you like. But there is not
strategic guidance from the top down.
I always found it very curious that there was no clear
strategic plan or strategic objectives articulated at the top
of the government, and I always thought it was the immense
nature of the U.S. Government, all the agencies and departments
and they could not get it together. But there certainly does
need to be this clear strategic objective articulated so that
the policy can be formed in all these key areas we have talked
about today--political transition, economic reconstruction, and
security--and have that flow downward rather than having it be
a bottom-up.
But clearly the administration--it eventually does make its
way up because we hear talk about the importance of shifting to
training security forces. This was in December that there was a
real emphasis on this from the White House. So it sort of makes
its way up very slowly.
Senator Biden. With all due respect, I do not think that
would have occurred had we not continued to beat them up and
beat them up and beat them up and raise it and raise it and
raise it and raise it and raise it. I could be wrong about
that. But I tell you what, I would like to suggest, and I will
conclude, Mr. Chairman, I would like to suggest that, with a
requisite degree of humility--and there cannot be too large a
dose of it--that this committee under your leadership, you and
I, attempt to lay out, attempt to lay out, what we think the
strategy should be or encompass, and where we cannot agree at
least lay out the alternatives that are available, because
quite frankly, Mr. President--Mr. Chairman--I do not know that
it is likely to come in any form that is discernible from any
other source, quite frankly.
But if we do it--look, you are the guy who put together
very quietly a group of the leading people in this country,
military, State, retired, active--I mean, employed--left and
right, to deal with this nation-building notion. I came along
for the ride with you on that. It was your leadership. I am
absolutely positively convinced that it would not have reached
the point where there is action occurring now had you not done
that.
So again, I mean this with absolute--there is not a large
enough dose of humility for me to suggest that we should try
this. But somebody--it has got to be started somewhere. You
guys do it. You guys do it from your think tanks, from your
background, from your interest, from your great credibility.
But it does not quite get there no matter how good you are.
So I think it ends up having to--I think it will force the
issue. I am going to be presumptuous: I think there will be a
lot of grateful administration people if, in fact, we could
somehow begin to force this issue. And maybe, if we begin, Mr.
Chairman, midterm or right in the beginning, it will maybe
prove to be unnecessary, and that will be a wonderful moment if
that occurs. But I think until we politically help, quite
frankly, in a bipartisan way, help make it clear that there is
a general consensus on the kinds of things we have to know, I
am not sure it is going to happen.
I want to point out now for the record and for the press
that remains here, there has been very little disagreement on
post-Saddam Iraqi policy, suggestions, criticisms, constructive
criticisms, between and among Democrats and Republicans in the
Senate. Almost every one of us who have taken this on as our
major responsibility, foreign policy and this, have been, if
not in the same pew, clearly in the same church. So I do not
see that much disagreement based on any partisan, partisan
approach to this. So I hope we can, at least, take a crack at
some version of that.
I personally want to thank each of you. Your testimony and
your advice for the last 2 years has been invaluable. Thank
you.
The Chairman. Well, I thank the distinguished ranking
member for his comments, and I would concur that it is very
important for our committee in a bipartisan way to view the
situation and to offer constructive ideas. We have been
attempting to do that, I think with some success. But I think
that probably we need to do more. Stimulated by your guidance
this morning, and the excellent testimony you have given, we
will proceed to do that.
Certainly it would be a better idea than simply having
partisan arguments about the competence of the President, of
the Secretary of State or Defense or whoever as individuals,
personalizing the situations, or debating which administration
does better. What we really need now are plans, as you pointed
out, with a fairly narrow timeframe in which some things have
to occur. If we are able to help stimulate that, this may be
for the better.
But in any event, we thank the three of you for your
comprehensive testimony and for being so forthcoming in your
responses. We are hopeful that we can call upon you again for
testimony, but in the meanwhile, perhaps at least, for some
expert advice.
Thank you very much. The hearing is adjourned.
[Whereupon, at 12:30 p.m., the committee was adjourned.]
----------

Additional Material Submitted for the Record

Letter From Andrew S. Natsios, Administrator, USAID

U.S. Agency for International Development,
Washington, DC, February 22, 2005.
Hon. Richard G. Lugar,
Chairman, Committee on Foreign Relations,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: I appreciate your continued support for the U.S.
Agency for International Development (USAID) and your determination to
ensure that our nation has the capability it needs to face our present
engagements in Iraq and the Middle East. Your efforts to engage the
Senate Foreign Relations Committee in a discussion of the strategies
necessary for the success of the Iraq reconstruction effort is welcome.
In that spirit, I would like to bring to your attention the
erroneous criticism of USAID in testimony before your Committee on
February 1, 2005. The subject of the hearing was ``Strategies for
Reshaping U.S. Policy in Iraq and the Middle East.'' The assessment of
USAID provided at the hearing was misinformed and displayed a
significant misunderstanding of our activities and the roles of the
different U.S. Government agencies involved in the decision-making
process for Iraq reconstruction.
The acknowledgement of the courageous efforts of USAID government
and contract personnel in Iraq who are implementing programs under
dangerous circumstances was much appreciated. Also noted, and we agree,
was the U.S. Government's effort to adapt to the need for more short-
term, quick-impact projects that realize more immediate results for
Iraqis. It was quite striking, however, that many of the policy
prescriptions and adaptations called for in the hearing are precisely
the activities that USAID has been implementing for some time.
Mr. Chairman, the enclosed document covers several points
concerning the successful performance of programs USAID has designed
and is implementing in Iraq. USAID has held and retains a vital role in
the U.S. Government effort to assist Iraqis in reconstruction and in
the transition to a stable democracy. May I request that you make this
letter and its enclosure a part of the record of your February 1, 2005,
hearing?
As always, I am available to provide you and your staff with any
information needed regarding our activities in Iraq.
Sincerely,
Andrew S. Natsios,
Administrator.
Enclosure.
______

USAID's Iraq Reconstruction Program

USAID has and continues to measure progress in Iraq and has
demonstrated a pattern of success in its reconstruction programs. USAID
has maintained transparency in its reporting to Congress and the
American public about how U.S. taxpayer dollars are being spent in
Iraq.

USAID continues to issue both daily updates (to date, nearly
500 have been issued) for internal government use and weekly
updates for public consumption (posted on our website) which
report on the progress of our different reconstruction projects
in Iraq.
Each USAID reconstruction program is linked to appropriate
strategic objectives within the U.S. National Strategy for
Supporting Iraq.
USAID cooperates with the Iraq Reconstruction Management
Office (IRMO) to ensure full support for U.S. Government
objectives and strategies, and integrates its reports on
progress with other U.S. Government efforts in Iraq, through
IRMO.
All USAID programs are implemented using a well-established
USAID procedure for the supervision of programs. Work plans are
generated and approved for every implementing partner. They are
adjusted as necessary based on the evolving, and extremely
dynamic, situation in Iraq.
To date, the USAID Inspector General (IG) has conducted 20
performance audits and 45 financial audits of USAID programs in
Iraq.
Performance audits conducted by the USAID IG generally found
USAID programs in Iraq to be in compliance with Federal
Acquisition Regulations and made recommendations to the process
going forward. These audit reports are available at
www.usaid.gov/oig/.
In addition, on performance of individual USAID contracts
for Iraq, the IG has generally found that the activities are
being carried out according to the contracts.
For example, an IG performance audit of USAID's Community
Action Program found that based on a statistical sample of 89
selected projects (e.g., citizen participation, inter-community
and local government cooperation) 98 percent were achieving
intended results. (January 2005)
An audit of USAID's reconstruction and rehabilitation
activities found that 64 of 72 of Bechtel's activities were
complete or on schedule. Remaining delays were due to changes
in scope, security and coordination issues with the Coalition
Provisional Authority or Iraqi ministries. (June 2004)
Additionally, an audit of results data reported by USAID for
Iraq education activities found that for eight activities
reviewed (e.g., schools rehabilitated, student kits and
furniture delivered) six were under-reported, one was reported
accurately, and one activity was over-reported (1,500 schools
rehabilitated verses 1,356 actual due to a differing definition
of what constituted completion). (June 2004)
The IG has completed 45 financial audits of USAID contracts
in Iraq. Twenty more are in process. These audits covered
various costs incurred under USAID/Iraq contracts totaling
approximately $591 million. Of those completed, questioned
costs have been minor (less than five percent of total amount
audited), and they have not been related to fraud. Moreover,
since these questioned costs are not related to fraud, much of
the questioned amount is subsequently allowed when additional
records are found to support the costs.
The USAID IG also works with the Special Inspector General
for Iraq Reconstruction and the results of all USAID IG audits
are included in his quarterly reports to Congress.
The IG is continuing to perform performance and financial
audits of the Iraq program. Our regional office in Iraq is
currently conducting three audits of USAID activities: Health
Care, Electrical Generation and Water and Sanitation
activities. These audits are examining whether intended outputs
are being achieved and whether sustainability in these programs
has been addressed by USAID.

Initial reconstruction funding under what is referred to as the
first Iraq Relief and Reconstruction Fund I (IRRF I), were appropriated
by Congress directly to USAID; however, USAID did not make all program
funding decisions.

IRRF I reconstruction funds implemented by USAID in Iraq
were targeted to the immediate needs identified by the U.S.
Government Disaster Assistance Response Team (DART) and as
approved by the CPA.
USAID made program funding decisions under IRRF I with the
approval of the CPA, and in many cases, received carefully
defined tasks to implement from the CPA.
Under IRRF I, USAID was appropriated approximately $2.1
billion for Iraq reconstruction efforts. To date, all of those
funds have been obligated and $1.7 billion (77.8 percent) has
been spent.
For example, of the $69,732,000 obligated by USAID for
healthcare programs in Iraq under IRRF I, $67,320,000 (96.6
percent) have been spent. These funds are being used to
directly benefit Iraqis--immunizing literally millions of Iraqi
children and hundreds of thousands of pregnant women, equipping
healthcare centers to improve primary care, and building
capacity at the Iraqi Ministry of Health.
Additionally, of the $1.03 billion apportioned under a USAID
contract to Bechtel for infrastructure reconstruction under
IRRF I, 100 percent has been obligated, and $766.9 million
(77.4 percent) has been spent. Tasks under this contract
included: power plant rehabilitation; rehabilitation of water
treatment facilities; telecommunications rehabilitation;
rehabilitation of essential roads, bridges, and railways;
school reconstruction; health clinic construction and
rehabilitation; rehabilitation of the Baghdad and Basrah
International Airports; and rehabilitation and management of
the Port of Umm Qasr.

Funding under IRRF II ($18.4 billion), as appropriated by Congress,
was managed by the now-expired CPA, and is currently managed by the
Iraq Reconstruction Management Office (IRMO) under the U.S. Department
of State Embassy in Iraq.

USAID does not maintain the responsibility for the overall
strategic programming and program funding decisions for IRRF II
funds.
Strategic programming authority under IRRF II resided with
the CPA under Ambassador Bremer until it expired, and is now
with IRMO under the direction of Ambassador Negroponte.
All IRRF II funds apportioned to USAID, under both the CPA
and IRMO, are programmed to fulfill specific U.S. government-
wide reconstruction goals.
USAID does not retain responsibility for programming the
entire $18.4 billion appropriated under IRRF II.
As of January 26, 2005, USAID had been apportioned slightly
less than $3 billion of the IRRF II funds. Of that total, over
$2.5 billion (87 percent) has been obligated to existing
contracts and grants and over $480 million has been spent on
ongoing CPA/IRMO-approved projects in support of the Iraqi
people.
The great bulk of the remainder of the $18.4 billion was
apportioned initially through the CPA to the Iraq Project
Management Office (PMO), and then to the Iraq Project and
Contracting Office (PCO), an organization of the U.S.
Department of Defense (post-CPA, the PMO was renamed as the
PCO).
The role of the CPA/PMO, and the programming decisions that
it made prior to its expiration, is an essential component to
any discussion of reconstruction strategy and spending.
Despite the relatively small share of reconstruction funds
apportioned to USAID, USAID has provided successful programs
which address short and medium-term needs while setting the
foundations for long-term stability.
Under the IRRF II, for example, a total $786 million is
dedicated to healthcare. USAID has been apportioned only $75
million (9 percent) of that amount. Of this, $50 million is
obligated to the current construction of a children's hospital
in Basrah, and the remaining funds are currently being
programmed to build capacity at the Ministry of Health. All
other dedicated healthcare funds have been apportioned to PCO.
Additionally, under IRRF II, USAID is implementing
successful programs in local governance, community development,
transition initiatives, health, education, private sector
development, economic governance, vocational education,
business skills training, agriculture, infrastructure
rehabilitation (power, water and sanitation, and
telecommunications), humanitarian assistance, and assistance to
the elections process.

USAID has undertaken a comprehensive approach to democratic
development in Iraq, not limited to elections as an event, but
encompassing the deeper and more profound changes required to establish
stable democratic institutions. Most importantly, USAID recognizes that
the spirit of democracy is rooted not in the institutions of
government, but in the people. Therefore, we have worked creatively and
vigorously to ensure that the Iraqi people have an active voice in the
creation of their own democracy.

USAID recognized, before arriving in Iraq, the importance of
effective regional and local governance to Iraq's future, both
as a tool of governance, and as an incubator for a new
generation of democratic elite. Toward that end, USAID programs
have worked in a coordinated fashion to support Iraq's
political transition, informing Iraqis of the process,
assisting in the devolution of authority to provincial and city
governments, and constructing the mechanisms to foster a new
cadre of democratic leaders in Iraq.
To promote diverse and representative citizen participation
in communities throughout Iraq, USAID designed the Iraq
Community Action Program (CAP). Under this program, USAID
awarded cooperative agreements now worth nearly $168 million to
five international non-governmental organizations (NGOs).
These NGOs are working in different regions across Iraq to
foster stability and improve Iraqis' lives by ensuring that
citizens' basic needs are met within their respective
communities in a process that gives Iraqis a voice in those
decisions. Specifically, this program:

Establishes community committees that are representative
of the gender, ethnic, and religious composition of the
community;
Demonstrates rapid improvements in Iraqis' lives and the
positive outcome of citizens working together to identify
common priorities; and
Draws upon local expertise to address identified priority
needs.

To date, CAP has worked with over 700 community groups to
implement over 3,000 immediate impact local projects, chosen by
the communities themselves.
The CAP process facilitates the development of community
leaders through the creation of the community groups. Over
12,000 Iraqis have stepped forward and been selected by their
communities to represent them in project selection and
implementation. This has provided a training ground for future
leaders, many of whom have gone on to fill leadership roles in
city, provincial, and national venues.
USAID also committed more than $2.4 million to a nationwide
Civic Education Campaign, which educates Iraqis on democracy
and Iraq's political situation. To date, USAID partners have
facilitated over 29,000 civic dialogue meetings attended by
over 750,000 Iraqis, helping them understand the concepts of
democracy and participate in the shaping of their future.
These meetings provided a forum for debate and the
development of democratic understanding. Never before in the
history of Iraq have so many Iraqis had the opportunity to
learn the fundamentals of democracy and prepare themselves to
actively participate in the development of their government.
A solid local government system in Iraq is the foundation
upon which a democratic national government can be built.
Effective local governance encourages citizen participation,
builds experience in governance, fosters dialogue among
competing groups, and delivers essential services based on
community priorities.
USAID is performing a thorough analysis of those candidates
elected to the Transitional National Assembly to determine how
many of those newly elected officials began their public
service at the local community and provincial levels with the
indirect support of USAID activities.
A near total vacuum existed in Iraq in the ability of
government institutions at all levels to provide basic services
such as water, sewer, electricity, solid waste collection and
disposal. USAID, therefore, designed and is implementing, in
April 2003, a $236 million Local Governance Program (LGP).
Since its inception, the LGP has worked with Iraqis in all 18
governorates to promote diverse and representative citizen
participation in provincial, municipal, and local councils.
During the first year of the program, USAID awarded $15.5
million in rapid response grants to strengthen the capacity of
municipal authorities to deliver core municipal services.
The LGP facilitated the establishment and reconstitution of
16 governorate councils, 90 district councils, 194 city or sub-
district councils, and 445 neighborhood councils.
The LGP also works to strengthen the management skills of
city and governorate administrations, local interim
representative bodies, and civic institutions to improve the
delivery of essential municipal services such as water, sewer,
electricity, solid waste collection and disposal; and civil
society organizations and their participation in public life.
LGP staffs have trained thousands of Iraqi civil servants in
the details of effective governance.
The LGP has fostered new Iraqi leaders whose leadership in
Iraq's govemorates, cities, and towns improves the quality of
life of Iraqi citizens. This new, non-Ba'athist cadre of civil
servants is playing an integral role in helping to secure
Iraq's evolving democratic future as they participate in
elections and the constitutional process.
Since the announcement of the November 15 agreement in 2003,
USAID has planned, implemented, and managed a comprehensive
package of technical assistance and commodities supporting
Iraq's transitional election process. This technical and
operational assistance, along with broader democratization and
civil society programs like CAP and the LGP, has contributed
greatly to the positive election outcome.
In support of the January elections, USAID's partners
implemented domestic election monitoring programs resulting in
the training of approximately 12,000 domestic observers and
15,000 of the accredited political party observers mobilized on
Election Day.
Through our partners, USAID implemented a comprehensive,
country-wide voter education and get-out-the-vote campaign,
including special programming for Sunni areas.
In the post-election period, USAID will continue to plan and
implement a variety of programs matching the needs of the
evolving Iraqi democracy, undertaken in full partnership with
Iraqi counterparts. In particular, USAID is undertaking
activities in four key areas--constitutional development,
institutional development, civic participation, and local
governance development--ensuring follow-up to elections success
with comprehensive support to the Iraqi democratic transition.

USAID has adapted to the challenges of the insurgency and is
providing short and medium-term deliverables through its programs--
directly and more visibly improving the lives of Iraqis.

USAID's programs have been designed, from the outset, to
balance the need for short and medium-term deliverables with
the need for setting the foundation for longer-term stability
in Iraq.
USAID's ongoing agriculture, civil society, education,
health, and local governance programs all institute grant
programs designed precisely for flexibility and short and
medium-term impact while linking these short-term impacts into
a coherent long-term strategy.
USAID has formed a unique partnership with the U.S. Army's
1st Cavalry Division (1st Cav). Together, USAID and the lst Cav
are focusing their efforts on reducing tensions in Sadr City
and other poor neighborhoods throughout Baghdad that have
become dangerous.
Since April 2004, USAID, in coordination with the 1st Cav,
has targeted immediate assistance, through its infrastructure
and transition initiative programs, to improve the provision of
essential services as well as to provide labor-intensive
projects such as trash pick-up and surface sewage removal in
restive Baghdad neighborhoods. In this joint effort, USAID has
approved more than 860 transition initiative grants, worth
nearly $100 million.
This effort has generated both extensive short-term
employment for thousands of Iraqis and provides the foundations
for medium-term stability. Since June 2004, USAID grants have
created temporary (60-day plus) jobs for an average of 21,000
local residents per month in the Baghdad districts of Sadr
City, Tissa Nissan, Abu Ghraib, Karradah, Al Rasheed, Al
Mansour, Al Adahamiyah and Al Khark.
Moving forward, these projects served as models for
collaboration between USAID and the U.S. military that was
replicated in other strategic cities, including Najaf,
Tal'Afar, and Samarra.

USAID has taken a comprehensive approach to the particular
challenges of market economic transitions.

USAID has extensive, successful experience assisting in
command-to-market economic transitions. We are well aware of
the time and effort this transition requires and our programs
reflect the long-term view, but do not ignore short and medium-
term deliverables.
Drawing on our experience, from Poland to Mongolia, we
designed and are implementing a comprehensive program of
systematic and sustained assistance in Iraq.
Individual programs in economic governance, private sector
development, vocational education, and agricultural reform
address both the immediate problems of Iraq's economy, and are
establishing the foundations for the long-term process of
economic transformation.

USAID has deployed highly qualified personnel to Iraq and these
staffs have maintained USAID's continuity on the ground.

USAID personnel joined a multi-agency effort to plan for
humanitarian and reconstruction needs in Iraq in late 2002, and
USAID was prepared to mobilize its significant development
resources and technical expertise to support humanitarian
relief and reconstruction requirements in Iraq.
Following the cessation of major conflict, the U.S.
Government deployed a multi-agency Disaster Assistance Response
Team (DART)--including USAID staff--to Iraq to assess and
respond to humanitarian needs and to help coordinate the
emergency relief effort.
At the same time, USAID deployed technical staff to prepare
for the immediate reconstruction requirements. USAID
established offices in Arbil, Baghdad, Al Hillah, and Al Basrah
and USAID personnel were located in Kuwait, Doha, Amman, and
Cyprus to provide regional support. On July 27, 2003, the USAID
Mission Director officially announced the formation of USAID's
Mission to Iraq. The USAID Mission in Baghdad coordinates all
USAID programs.
USAID has deployed numerous expert personnel, with post-
conflict development experience in regions including Serbia,
Bosnia, Kosovo, Rwanda, West Bank/Gaza, and East Timor, to
Iraq.
Regional experts with experience in programs throughout the
Arab world, from Jordan to Egypt to Morocco, are a core part of
USAID's staff, as well as of the staffs of our contractors.
USAID experts include career foreign service officers with
decades of overseas experience; academics who have spent many
years doing research on topics as diverse and relevant as local
governance in the Arab world, peace-building, and strategic
planning for reconstruction and stabilization; economists and
lawyers specialized in command-to-market transitions who have
served from Poland to Mongolia; engineers with major project
experience in infrastructure development throughout the
developing world; and civil society experts who have run
programs in countries as diverse as Guatemala, Mali, Egypt, and
Romania.
Our experts are not merely visiting Iraq. They are deployed
there for an extended period of time. In fact, there are still
USAID personnel on the ground that entered Iraq immediately
following the war in 2003. As a result of their exceptional
skill and dedication, the majority of USAID senior staff tours
in Iraq have averaged over one year from the beginning of our
service there. This pattern does not evidence a lack of
continuity.

USAID has, and continues to work in close cooperation, indeed
partnership, with both the appropriate government agencies in Iraq, as
well as with the Iraqi people.

All USAID programs have been developed, and are implemented
in the closest possible consultation with Iraqi government
leaders and organizations.

USAID and all of its partners employ large numbers of Iraqi
professional staff in a wide range of technical and expert roles in
every program area.

We continue to expend considerable effort to train Iraqi
contractors to function as productive sub-contractors on
various reconstruction projects using substantial numbers of
Iraqi labor.
For example, Bechtel has used 120 different Iraqi
subcontractors on 160 subcontracts for a total value of $185
million under its first contract. Additionally, Bechtel
employed an average of 3-4,000 Iraqis per day in 2004 on
projects in Iraq.
At present, USAID programs, contracts and grants alone are
employing 53,900 Iraqis.