POLITICS
08/13/2008 05:12 am ET | Updated May 25, 2011

Iraq Government Has $79 Billion in Unspent Cash

The soaring price of oil will leave the Iraqi government with a cumulative budget surplus of as much as $79 billion by year's end an American federal oversight agency has concluded in an analysis released on Tuesday.

The unspent windfall, which covers surpluses from oil sales from 2005 through 2008, appears likely to put an uncomfortable new focus on the approximately $48 billion in American taxpayer money devoted to rebuilding Iraq since the American-led invasion.

Over all, the report from the Government Accountability Office estimates, Iraqi oil revenue from 2005 through the end of this year will amount to at least $156 billion. And in an odd financial twist, large amounts of the surplus money is sitting in an American bank in New York -- nearly $10 billion at the end of 2007, with more expected this year, when the accountability office estimates a skyrocketing surplus.

The report was requested by two senior senators, Carl Levin, Democrat of Michigan, and John W. Warner, Republican of Virginia, and on Tuesday they were quick to express strong dissatisfaction over the contrast between American spending on reconstruction and the weak record of spending by Iraq itself, in spite of the colossal surpluses.

The senators pointed out in a statement that in 2007, for example, Iraq actually spent only 28 percent of its $12 billion dollar reconstruction budget according to the accountability office - and even that number could overstate the success rate in most of Iraq, since $2 billion of the spending took place in relatively peaceful confines of the northern Kurdish region.

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