The traffic in Baghdad may give the impression that people’s standards of living have improved so much that ordinary individuals can buy cars that they could not afford before. But in fact the congestion is a result of the many streets that are closed for fear of car bombs and the large cement-and-steel walls built in the middle of streets and major roads to prevent attacks, as well as the 300,000 used cars that have been imported tax free in the past six months.

This is not to say that things have not changed or moved forward since the toppling of the Saddam Hussein regime last April. After decades of repression there is freedom of expression, and that is much welcomed by the Iraqis. There are opportunities for economic development as free enterprise is introduced, the heavy debt burden is reduced and the payment of UN war reparations is being called into question.
But there are formidable economic and political problems ahead. It is estimated that 50 percent of the work force is unemployed, 60 percent of the population lives under the poverty line and the inflation rate is around 15 percent a month.

It is not unusual to see children in the street picking through garbage to get their daily meals. Meanwhile, budgets and plans to pour billions of dollars in the country during the next few months are being drawn up by both the US and international financial institutions. The question is: How and when will these funds reach the ordinary Iraqi citizen?

Senior politicians fear that the country could be on the verge of a social explosion. The weekly demonstrations by the unemployed in Baghdad and the south have been peaceful so far, but it remains to be seen how long they will stay that way. Some observers worry that instead of the many capital-intensive projects being promoted in exhibitions and conferences in neighboring countries to attract foreign companies, there should be a labor-intensive public works program started in Iraq itself, utilizing available small and medium-sized Iraqi engineering and construction companies and the tens of thousands of unemployed professionals and workers to rebuild the roads, schools and other public facilities that were neglected by the previous regime and lacked maintenance because of sanctions.

Politically, the two most important issues ­ beside jobs ­ are the return of sovereignty and national reconciliation. Many middle class and professional Iraqis are worried that elections in the next few months will polarize society even further rather than resolve issues. Another basic issue is the lack of voter registration and the chaotic situation on Iraq’s borders which is allowing a large number of foreigners to enter the country. Uppermost in many people’s minds is the fact that the US appears to be favoring the religious establishment and tribal leaders at the expense of the middle class and secularists. These new elites are conservative by nature and their outlook is parochial at best. Their interests do not transcend their local communities, and hardly encompass a modern vision of a unified Iraq.

Many are worried that the rules and terms of reference applied so far by the Coalition Provisional Authority (CPA) do not bode well for the future. The selection of the members of the Governing Council was based on sectarian and ethnic identification more than anything else. It could perhaps be argued that this was necessary in the early days after the fall of the Baath regime.

However, the Iraqis are now discovering that the same principle of sectarian and ethnic proportional representation is also being applied in the case of Cabinet ministers, undersecretaries, ambassadors and the like. A lack of supervisory control has resulted in ministers appointing officials in their institutions from their own community, rather than choosing professionals. There is also public resentment of the widespread corruption among the new officials and the fact that they are not accountable for their actions.
There is very little systematic information either about the deliberations and inner politics of the Governing Council, or the philosophy of the majority of the council members; the way they take decisions is a cause for concern. The recent replacement of Iraqi civil law concerning family affairs with Sharia law has caused a furor in Iraq, particularly among Iraqi women, who have fought hard for their rights. What is equally unsettling is that the decision was taken without much debate and became known to the public post facto. It is now up to US civilian administrator in Iraq Paul Bremer to repeal it.

It would be foolhardy to assume that after three decades of dictatorship, particularly that of Saddam Hussein, stability and progress can be achieved without a long period of trial and error. However, it is ominous that the foundations now being laid for the future appear to contain the seeds of a civil war. Iraq is made up of three main communities, and when one group feels marginalized it starts creating problems for the whole state. This was the case in the past with the Kurds and the Shiites, and it is the case today with the Sunnis.

What the current political process lacks, and it is a lack that the proposed elections will not remedy, is an initiative to bring together the representatives of the main groups to reach a new social contract to replace the old one before the elections are held. To simply call for elections and draw up a political process to hand over authority to a major religious group without a clearly defined  relationship between the communities would lead to disaster. What is needed today is a political process through which the three main communities can learn to compromise with each other, accommodate differences and achieve national reconciliation ­ before elections are held, not afterward.

An idea being mooted now by the CPA and Council members is to maintain and enlarge the Governing Council after 1 July to include more Sunnis and secularists. This may help resolve some of the problems. But it remains to be seen whether the confessional approach to politics will succeed in Iraq or if it will start on the road so disastrously taken by Lebanon.
 
Walid Khadduri is editor in chief of the Middle East Economic Survey. This article appeared in MEES, on Jan. 26, 2004, and is reprinted with permission

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