"Well here's another nice mess you've gotten me into"
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While the Bush dictatorship et al appears unwilling or unable to provide an estimate for reparations in Iraq, other independent non-politically motivated think tanks have. Early estimates have varied widely and seem to be several standards of deviation out of synch. (From April 84bn to 500bn) Admittedly a lot of water has flowed under the bridge since then - a lot more chance to get into Iraq and take a look around. Today the BBC has a story on a report by the McKinsey management consultants that puts the cost at a somewhat conservative 90bn. I use the term conservative based on the mounting tab that we're seeing from Haliburton of late. The McKinsey report seems a bit more detailed and thought out than the rest so I'll present a few of the findings here for your perusal.
The investment, which would focus on re-building infrastructure, will take a decade, said Achmed al-Shahrabani, who is leading a special Iraq initiative by management consultants McKinsey.
Reconstruction could take 10 years Speaking at a conference on Iraq reconstruction in London, he said that oil revenues would not be enough to cover Iraq's economic rehabilitation. | Let's take a moment to examine that statement a bit more closely. First, in regard to the above stated estimates for rebuilding Iraq, the estimates do have something in common - no matter which number you pick, the U.S. simply can't afford it especially considering the deficits we're in store for beginning with the next fiscal budget. I think even Bush would agree with my assessment. That is, if he's sentient today. Secondly, I think my four or five ardent readers would agree with me when I state that the killing of Iraq liberation of the Iraqis was, at least in part, due to their oil. This has been the plan all along although dubya tends to downplay this aspect of the war. Everyone knew from the beginning that the Iraq's oil was intended to be the source of the scratch for rebuilding their country. So let's do a little quick math shall we.
Iraq's oil industry would need $35bn-40bn - the lion's share of any investment - to increase production to 6 million-7 million barrels a day (b/d) by 2010, according to McKinsey.
Although, Iraq possesses the second largest oil reserves in the world, after Saudi Arabia, it currently has the capability to pump only 1.5 million b/d.
Based on 30$/brl, that grosses about 17bn dollars a year. And the keyword here is grosses. The GDP for Iraq was estimated at 57bn (in 2000) so oil is their major player. Iraq also imports 13.8 bn. Iraq has a debt of approximately 200bn. Now if you subtract the 13.8 import cost from the 17 bn oil revenue, albeit a very crude analysis (NPI), that leaves about 4bn to play with so to speak. Of course this figure doesn't include the entire country's GNP but to the estent we don't really know how much of that infrastructure has been decimeted we'll stick with what we do know. The oil is well guarded as we all know. Unfortunately, precise figures for the annual budget for Iraq isn't known. Saddam was the kind of guy that didn't like sharing data of that sort but I think we can see that we're in one hell of a quagmire here that just isn't going to go away in the next few months.
All of this assumes, of course, a politically and socially stable Iraq in the meantime. Given the bang-up job we've done in Afghanistan, anyone want to give me odds on that?
Reference sticker shock below:
| Iraq's estimated investment needs |
| Utilities |
Reconstruction of basic infrastructure such as transport facilities, telecommunications and utilities (power capacity currently at 1,800 MW compared with 9,500 MW pre-1990) |
$10bn-15bn just for electricity and telecoms |
| Oil & gas |
Re-establishing and increasing oil production capacity to 6 million-7 million barrels a day by 2010 |
$35bn-40bn |
| Healthcare |
Re-establishing pre-1980 health care facilities and standards |
$10bn-20bn |
| Education |
Rebuilding and upgrading of primary, secondary and tertiary education institutions |
$6bn-12bn |
| Transport infrastructure |
Rebuilding 40,000 km of paved roads, three main railway lines, three main airports, two ports |
Several billions |
| Source: McKinsey |
4:24:27 PM 
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