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If U.S. corporations get their way, none of their European competitors will be doing business in Baghdad.
Mar 29, 2003 | It's the latest question about Iraq, debated from myriad war blogs to the pages of Friday's Wall Street Journal: When Saddam Hussein is toppled, what kind of cellular phone system should Iraq have?
Maybe that's not ultimately as important as such questions as whether preemptive wars are morally justifiable or if there will be a "domino democracy" chain reaction in the Mideast unleashed by regime change. But it's a good sign of what one of the biggest postwar battles will be fought over: Who gets to rebuild Iraq, and how?
On Wednesday, Darrel Issa, a Republican congressman from Southern California, sent a letter to Defense Secretary Donald Rumsfeld asking him to make sure that the U.S. builds a CDMA cell system in Iraq -- the same system that's used in America, and one developed by Qualcomm, which happens to be one of Issa's most generous donors. The Defense Department had apparently been thinking of setting up a GSM system in Iraq, but Issa warned Rumsfeld that such a system, which is the standard in Europe, and elsewhere in the Mideast, would benefit "French and European sources, not U.S. patent holders." On Thursday, Issa introduced a bill that would make his policy recommendations law. There are no official co-sponsors, but under the headline "Parlez-vous frangais?" on his Web site, a statement says that many lawmakers have already expressed their support for an American cellphone system in Iraq.
It's not clear if members of Congress -- many of whom, remember, were for telecom deregulation in the U.S. -- will want to mandate the cellphone standard of postwar Iraq. But even if Issa's bill isn't passed into law, its broad policy goal -- putting American firms at the front of the line in a Saddam-free Iraq -- already seems to be the Bush administration's attitude.
Of the $75 billion in war-related money the White House has requested from Congress to cover the costs of war in Iraq, $3.5 billion is set aside for reconstruction and relief in Iraq. In the months ahead, as the specific needs of postwar Iraq become clearer, American companies are expected to get most, if not all, of the lucrative contracts provided by the new money. Already, there has been domestic and international criticism of the manner in which the money has been handed out. Before the war began, the United States Agency for International Development invited a few well-connected companies -- including Kellogg, Brown & Root, a subsidiary of Halliburton, the oil-services firm that Vice President Dick Cheney used to run -- to bid on a massive infrastructure-rebuilding contract for Iraq. A USAID officer told Newsweek on Friday that Halliburton was not likely to be awarded that deal. On Tuesday, the Army Corps of Engineers announced that, without soliciting bids from any other firms, it had selected KBR to manage the oil-well firefighting effort in Iraq.
Thanks to strong British lobbying, some U.K. businesses may get in on these deal as well, according to news reports. But if you have eyes on the money-prize in Iraq, it's now a terrible time to be a businessperson based in France, Russia or Germany, the three nations that put up the highest diplomatic hurdles to the war in Iraq. Up until the war, firms in these countries enjoyed -- as many conservatives are fond of mentioning -- substantial dealings with Saddam Hussein's government. But the White House's America-first policy for reconstruction work, not to mention congressional efforts like Issa's, may be an unwelcome sign of things to come.
How will these firms deal with American money and might in Iraq? Their initial efforts will likely be in the realm of international diplomacy. Companies in Russia and France are said to be pushing their governments to demand a powerful role for the United Nations in postwar Iraq in order to level the business playing field there. Diplomats on the U.N. Security Council spent much of the war's first week debating the future of the oil-for-food program, which, until it was suspended before the war began, had allowed Saddam Hussein to sell billions of dollars of oil each year in return for humanitarian aid. After several closed-door meetings, the diplomats seem to have agreed to start shipping about $10 billion of food aid to Iraq, but they put off the touchy question of whether the U.S. and U.K., as the occupiers of Iraq, would have the power to invalidate existing contracts made with Saddam.
The U.S. line on the issue of who gets to decide which companies make money in "free Iraq" -- to use the term already in vogue among some conservatives -- is that Iraqis themselves will have the power to choose. And if the new Iraqi government is nicest to the Americans, and wants to tear up Saddam's contracts, proponents of the war argue that it will be no surprise. "I think you can bet on it that the government of Iraq after Saddam will remember who wanted the dictator gone and who opposed it," says Radek Sikorski, a former deputy foreign minister of Poland and now a resident fellow at the American Enterprise Institute, a conservative think tank in Washington.
But for some time before a freely elected Iraqi government is set up, the U.S. has plans to install an American military-civilian government in Iraq, and it's in that time that the Europeans could get sidelined. As Secretary of State Colin Powell told a congressional panel on Wednesday, "We didn't take on this huge burden with our coalition partners not to be able to have a significant, dominating control over how it unfolds."
