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Senate panel hears hopeful Iraq reports

John Dimsdale Apr 8, 2008

Senate panel hears hopeful Iraq reports

John Dimsdale Apr 8, 2008


Kai Ryssdal: Call it a pause, as some have, or call it a period of consolidation and evaluation, as General Petraeus did today. Either way, if the president goes along with the general’s recommendations, the U.S. presence in Iraq will stabilize at somewhere near 140,000 troops.

The White House is set to send a supplemental budget request up to Congress in the next few weeks asking for $100 billion to help pay for that.

On the topic of reconstruction, Ambassador Crocker was sitting next to the general at the witness table. He said Iraq’s actually beginning to pay for rebuilding itself.

From Washington, Marketplace’s John Dimsdale reports.

John Dimsdale: In 2003, some Pentagon officials predicted Iraq’s oil wealth would pay for most of the war’s costs. Five years and 700 billion U.S. dollars later, Ambassador Crocker says the Iraqi government has begun paying some of the bills for cleaning streets and stabilizing communities.

Nebraska Democratic Senator Ben Nelson told Crocker he’ll try to attach an amendment to future Iraq war budget bills that would change U.S. reconstruction grants to loans.

Ben Nelson: It just does not seem responsible for us to continue to borrow from our grandchildren and China and other places around the world to be able to finance in effect what is their future opportunity.

Democrats say U.S. payments are especially unfair since Iraq’s government is running a surplus. Amy Myers Jaffe is a research fellow at Rice University and worked on the Iraq Study Group.

Amy Myers Jaffe: It helps Iraq that the price of oil is a hundred dollars.

But even with all that oil revenue, Jaffe says Iraq doesn’t have enough money for its own reconstruction.

Jaffe: The kind of expenses that the country is going to have to undertake to reconstruct not only the energy industry but also all the basic infrastructure in the country is going to cost a fortune — billions if not trillions — and the oil is not going to pay for all of that.

Iraq is still not producing oil at pre-war levels and oil infrastructure remains vulnerable to attacks. Jaffe says whether to pull the plug on financing reconstruction is a question of U.S. national security.

In Washington, I’m John Dimsdale for Marketplace.

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