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Crony War: How Washington Fights Its Money Wars

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Cross-posted with TomDispatch.com

America's post-9/11 conflicts have been wars of corruption, a point surprisingly seldom made in the mainstream media. Keep in mind that George W. Bush's administration was a monster of privatization. It had its own set of crony corporations, including Halliburton, KBR, Bechtel, and various oil companies, as well as a set of mercenary rent-a-gun outfits like Blackwater, DynCorp, and Triple Canopy that came into their own in this period. It took the plunge into Iraq in March 2003, sweeping those corporations and an increasingly privatized military in with it. In the process, Iraq would become an example not of the free market system, but of a particularly venal form of crony capitalism (or, as Naomi Klein has labeled it, "disaster capitalism").

Add in another factor: in the wake of the 9/11 attacks, the Bush administration began pouring money into the Pentagon, into, that is, an organization whose budget has never been able to pass an audit. There was so staggeringly much money to throw around then -- and hubris to spare as well. Among the first acts of L. Paul Bremer III, the new American proconsul in Baghdad, was the disbanding of Saddam Hussein's army (creating an unemployed potential insurgent class) and the closing down of a whole range of state enterprises along with the privatization of the economy (creating their unemployed foot soldiers). All of this, in turn, paved the way for a bonanza of "reconstruction" contracts granted, of course, to the administration's favorite corporations to rebuild the country. There were slush funds aplenty; money went missing without anyone blinking; and American occupation officials reportedly "systematically looted" Iraqi funds.

In April 2003, when American troops entered Baghdad, it was already aflame and being looted by its own citizens. As it turned out, the petty looters soon enough went home -- and then the real looting of the country began. The occupiers, thanks to the U.N., fully controlled Iraq's finances and no one at the U.N. or elsewhere had the slightest ability to exercise any real supervision over what the occupation regime did or how it spent Iraq's money. Via a document labeled "Order 17," Bremer granted every foreigner connected to the occupation enterprise the full freedom of the land, not to be interfered with in any way by Iraqis or any Iraqi political or legal institution. He gave them all, that is, an official get-out-of-jail-free card.

Who could be surprised, then, that the massive corporate attempt to rebuild Iraq would result in a plague of overbilling, remarkable amounts of shoddy or useless work, and a blown $60 billion "reconstruction" effort that would leave the country with massive unemployment and without reliable electricity, water, or sewage systems? Could there be a sadder story of how war making and corruption were being wedded on a gigantic scale in an already fading new century? As it turned out, the answer to that question was: yes.

Iraqi corruption was no anomaly of war, as TomDispatch regular Dilip Hiro makes clear in his recent piece "The Great Afghan Corruption Scam." As with the "liberation" of Afghanistan, Washington evidently now regularly turns its wars into field days for corruption.