How to pay for Iraq jobs proposal?

John Dimsdale Jan 10, 2007

KAI RYSSDAL: Whaddya suppose it’s like to sit in front of the cameras and give a speech to the country when everybody already knows what you’re going to say. The main points of the President’s speech tonight might have been leaked — 22,000 troops, and more money for reconstruction. But critics have been saying for days it’s not enough troops. Now some of them are saying it’s not enough money, either. Our Washington bureau chief John Dimsdale reports.

JOHN DIMSDALE: President Bush reportedly wants an additional billion dollars in so-called microfinance grants and loans for Iraqi entrepreneurs. He’ll also propose expanding the Provincial Reconstruction Teams. Those are groups of U.S. government civilians coordinating job creation programs and training local Iraqi government workers.

Rick Barton at the Center for Strategic and International Studies welcomes the Bush administration’s focus on decentralizing economic aid.

RICK BARTON: It’s really the right design and what we should have done from the beginning. It may be too little, too late because the violence and the sectarian strife is really so widespread now.

The U.S. has already spent between 20 and 35 billion dollars on Iraqi reconstruction projects. But Robert Perito, an adviser to the Iraq Study Group, says there’s little to show for it.

ROBERT PERITO: It was all channeled through very large, U.S.-based corporations. That failed because it failed to engage the Iraqis. These international corporations brought in foreign workers to do the job rather than employing Iraqis. So it’s probably a step forward that this approach seems to be focused on engaging Iraqis directly.

But worried that Congress won’t approve more money, the White House is only talking about an additional $2-to-5 billion for economic aid. And Rick Barton at CSIS worries Iraqis won’t see most of that money.

BARTON: It’s probably not going to happen because we’re likely to re-create some of the programs we’ve used in the past, as opposed to maybe finding ways of getting existing employers to add new employees.

And given the violence in their country, Barton says Iraqis who receive financial aid will end up spending a lot of it on security and insurance.

In Washington, I’m John Dimsdale for Marketplace.

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