The Shia, the majority of Iraq's population, have gained power for the first time in more than 1,300 years. Above all, many Shia are interested in preserving that power. However, fissures have emerged within the broad Shia coalition, known as the United Iraqi Alliance. Shia factions are struggling for power—over regions, ministries, and Iraq as a whole. The difficulties in holding together a broad and fractious coalition have led several observers in Baghdad to comment that Shia leaders are held "hostage to extremes." Within the coalition as a whole, there is a reluctance to reach a political accommodation with the Sunnis or to disarm Shiite militias.
Prime Minister Nouri al-Maliki has demonstrated an understanding of the key issues facing Iraq, notably the need for national reconciliation and security in Baghdad. Yet strains have emerged between Maliki's government and the United States. Maliki has publicly rejected a U.S. timetable to achieve certain benchmarks, ordered the removal of blockades around Sadr City, sought more control over Iraqi security forces, and resisted U.S. requests to move forward on reconciliation or on disbanding Shiite militias.
The U.S. deals primarily with the Iraqi government, but the most powerful Shia figures in Iraq do not hold national office. Of the following three vital power brokers in the Shia community, the United States is unable to talk directly with one (Grand Ayatollah Ali al-Sistani) and does not talk to another (Moqtada al-Sadr).
GRAND AYATOLLAH ALI AL-SISTANI: Sistani is the leading Shiite cleric in Iraq. Despite staying out of day-to-day politics, he has been the most influential leader in the country: all major Shia leaders have sought his approval or guidance. Sistani has encouraged a unified Shia bloc with moderated aims within a unified Iraq. Sistani's influence may be waning, as his words have not succeeded in preventing intra-Shia violence or retaliation against Sunnis.
ABDUL AZIZ AL-HAKIM: Hakim is a cleric and the leader of the Supreme Council for the Islamic Revolution in Iraq (SCIRI), the largest and most organized Shia political party. It seeks the creation of an autonomous Shia region comprising nine provinces in the south. Hakim has consistently protected and advanced his party's position. SCIRI has close ties with Iran.
MOQTADA AL-SADR: Sadr has a large following among impoverished Shia, particularly in Baghdad. He has joined Maliki's governing coalition, but his Mahdi Army has clashed with the Badr Brigades, as well as with Iraqi, U.S., and U.K. forces. Sadr claims to be an Iraqi nationalist. Several observers remarked to us that Sadr was following the model of Hezbollah in Lebanon: building a political party that controls basic services within the government and an armed militia outside of the government.
Sunni Arabs feel displaced because of the loss of their traditional position of power in Iraq. They are torn, unsure whether to seek their aims through political participation or through violent insurgency. They remain angry about U.S. decisions to dissolve Iraqi security forces and to pursue the "de-Baathification" of Iraq's government and society. Sunnis are confronted by paradoxes: they have opposed the presence of U.S. forces in Iraq but need those forces to protect them against Shia militias; they chafe at being governed by a majority Shia administration but reject a federal, decentralized Iraq and do not see a Sunni autonomous region as feasible for themselves.
The influence of Sunni Arab politicians in the government is questionable. The leadership of the Sunni Arab insurgency is murky, but the following two key Sunni Arab figures have broad support.
tariq al-hashimi: Hashimi is one of two vice presidents of Iraq and the head of the Iraqi Islamic Party, the largest Sunni Muslim bloc in parliament. Hashimi opposes the formation of autonomous regions and has advocated the distribution of oil revenues based on population, a reversal of de-Baathification, and the removal of Shiite militia fighters from the Iraqi security forces. Shiite death squads have recently killed three of his siblings.
sheik harith al-dhari: Dhari is the head of the Muslim Scholars Association, the most influential Sunni organization in Iraq. Dhari has condemned the American occupation and spoken out against the Iraqi government. His organization has ties both to the Sunni Arab insurgency and to Sunnis within the Iraqi government. A warrant was recently issued for his arrest for inciting violence and terrorism, an act that sparked bitter Sunni protests across Iraq.
Iraqi Kurds have succeeded in presenting a united front of two main political blocs—the Kurdistan Democratic Party (KDP) and the Patriotic Union of Kurdistan (PUK). The Kurds have secured a largely autonomous Kurdish region in the north, and have achieved a prominent role for Kurds within the national government. Barzani leads the Kurdish regional government, and Talabani is president of Iraq.
Leading Kurdish politicians told us they preferred to be within a democratic, federal Iraqi state because an independent Kurdistan would be surrounded by hostile neighbors. However, a majority of Kurds favor independence. The Kurds have their own security forces—the peshmerga—which number roughly 100,000. They believe they could accommodate themselves to either a unified or a fractured Iraq.
Kurdish politics has been dominated for years by two figures who have long-standing ties in movements for Kurdish independence and self-government.
MASSOUD BARZANI: Barzani is the leader of the Kurdistan Democratic Party and the President of the Kurdish regional government. Barzani has cooperated with his longtime rival, Jalal Talabani, in securing an empowered, autonomous Kurdish region in northern Iraq. Barzani has ordered the lowering of Iraqi flags and raising of Kurdish flags in Kurdish-controlled areas.
JALAL TALABANI: Talabani is the leader of the Patriotic Union of Kurdistan and the President of Iraq. Whereas Barzani has focused his efforts in Kurdistan, Talabani has secured power in Baghdad, and several important PUK government ministers are loyal to him. Talabani strongly supports autonomy for Kurdistan. He has also sought to bring real power to the office of the presidency.
NATIONAL RECONCILIATION. Prime Minister Maliki outlined a commendable program of national reconciliation soon after he entered office. However, the Iraqi government has not taken action on the key elements of national reconciliation: revising de-Baathification, which prevents many Sunni Arabs from participating in governance and society; providing amnesty for those who have fought against the government; sharing the country's oil revenues; demobilizing militias; amending the constitution; and settling the future of Kirkuk.
One core issue is federalism. The Iraqi Constitution, which created a largely autonomous Kurdistan region, allows other such regions to be established later, perhaps including a "Shi'astan" comprising nine southern provinces. This highly decentralized structure is favored by the Kurds and many Shia (particularly supporters of Abdul Aziz al-Hakim), but it is anathema to Sunnis. First, Sunni Arabs are generally Iraqi nationalists, albeit within the context of an Iraq they believe they should govern. Second, because Iraq's energy resources are in the Kurdish and Shia regions, there is no economically feasible "Sunni region." Particularly contentious is a provision in the constitution that shares revenues nationally from current oil reserves, while allowing revenues from reserves discovered in the future to go to the regions.
The Sunnis did not actively participate in the constitution-drafting process, and acceded to entering the government only on the condition that the constitution be amended. In September, the parliament agreed to initiate a constitutional review commission slated to complete its work within one year; it delayed considering the question of forming a federalized region in southern Iraq for eighteen months.
Another key unresolved issue is the future of Kirkuk, an oil-rich city in northern Iraq that is home to substantial numbers of Kurds, Arabs, and Turkmen. The Kurds insisted that the constitution require a popular referendum by December 2007 to determine whether Kirkuk can formally join the Kurdish administered region, an outcome that Arabs and Turkmen in Kirkuk staunchly oppose. The risks of further violence sparked by a Kirkuk referendum are great.
Iraq's leaders often claim that they do not want a division of the country, but we found that key Shia and Kurdish leaders have little commitment to national reconciliation. One prominent Shia leader told us pointedly that the current government has the support of 80 percent of the population, notably excluding Sunni Arabs. Kurds have fought for independence for decades, and when our Study Group visited Iraq, the leader of the Kurdish region ordered the lowering of Iraqi flags and the raising of Kurdish flags. One senior American general commented that the Iraqis "still do not know what kind of country they want to have." Yet many of Iraq's most powerful and well-positioned leaders are not working toward a united Iraq.
SECURITY. The security situation cannot improve unless leaders act in support of national reconciliation. Shiite leaders must make the decision to demobilize militias. Sunni Arabs must make the decision to seek their aims through a peaceful political process, not through violent revolt. The Iraqi government and Sunni Arab tribes must aggressively pursue al Qaeda.
Militias are currently seen as legitimate vehicles of political action. Shia political leaders make distinctions between the Sunni insurgency (which seeks to overthrow the government) and Shia militias (which are used to fight Sunnis, secure neighborhoods, and maximize power within the government). Though Prime Minister Maliki has said he will address the problem of militias, he has taken little meaningful action to curb their influence. He owes his office in large part to Sadr and has shown little willingness to take on him or his Mahdi Army.
Sunni Arabs have not made the strategic decision to abandon violent insurgency in favor of the political process. Sunni politicians within the government have a limited level of support and influence among their own population, and questionable influence over the insurgency. Insurgents wage a campaign of intimidation against Sunni leaders—assassinating the family members of those who do participate in the government. Too often, insurgents tolerate and cooperate with al Qaeda, as they share a mutual interest in attacking U.S. and Shia forces. However, Sunni Arab tribal leaders in Anbar province recently took the positive step of agreeing to pursue al Qaeda and foreign fighters in their midst, and have started to take action on those commitments.
Sunni politicians told us that the U.S. military has to take on the militias; Shia politicians told us that the U.S. military has to help them take out the Sunni insurgents and al Qaeda. Each side watches the other. Sunni insurgents will not lay down arms unless the Shia militias are disarmed. Shia militias will not disarm until the Sunni insurgency is destroyed. To put it simply: there are many armed groups within Iraq, and very little will to lay down arms.
GOVERNANCE. The Iraqi government is not effectively providing its people with basic services: electricity, drinking water, sewage, health care, and education. In many sectors, production is below or hovers around prewar levels. In Baghdad and other unstable areas, the situation is much worse. There are five major reasons for this problem.
First, the government sometimes provides services on a sectarian basis. For example, in one Sunni neighborhood of Shia-governed Baghdad, there is less than two hours of electricity each day and trash piles are waist-high. One American official told us that Baghdad is run like a "Shia dictatorship" because Sunnis boycotted provincial elections in 2005, and therefore are not represented in local government.
Second, security is lacking. Insurgents target key infrastructure. For instance, electricity transmission towers are downed by explosives, and then sniper attacks prevent repairs from being made.
Third, corruption is rampant. One senior Iraqi official estimated that official corruption costs Iraq $5-7 billion per year. Notable steps have been taken: Iraq has a functioning audit board and inspectors general in the ministries, and senior leaders including the Prime Minister have identified rooting out corruption as a national priority. But too many political leaders still pursue their personal, sectarian, or party interests. There are still no examples of senior officials who have been brought before a court of law and convicted on corruption charges.
Fourth, capacity is inadequate. Most of Iraq's technocratic class was pushed out of the government as part of de-Baathification. Other skilled Iraqis have fled the country as violence has risen. Too often, Iraq's elected representatives treat the ministries as political spoils. Many ministries can do little more than pay salaries, spending as little as 10-15 percent of their capital budget. They lack technical expertise and suffer from corruption, inefficiency, a banking system that does not permit the transfer of moneys, extensive red tape put in place in part to deter corruption, and a Ministry of Finance reluctant to disburse funds.
Fifth, the judiciary is weak. Much has been done to establish an Iraqi judiciary, including a supreme court, and Iraq has some dedicated judges. But criminal investigations are conducted by magistrates, and they are too few and inadequately trained to perform this function. Intimidation of the Iraqi judiciary has been ruthless. As one senior U.S. official said to us, "We can protect judges, but not their families, their extended families, their friends." Many Iraqis feel that crime not only is unpunished, it is rewarded.
There has been some economic progress in Iraq, and Iraq has tremendous potential for growth. But economic development is hobbled by insecurity, corruption, lack of investment, dilapidated infrastructure, and uncertainty. As one U.S. official observed to us, Iraq's economy has been badly shocked and is dysfunctional after suffering decades of problems: Iraq had a police state economy in the 1970s, a war economy in the 1980s, and a sanctions economy in the 1990s. Immediate and long-term growth depends predominantly on the oil sector.
There are some encouraging signs. Currency reserves are stable and growing at $12 billion. Consumer imports of computers, cell phones, and other appliances have increased dramatically. New businesses are opening, and construction is moving forward in secure areas. Because of Iraq's ample oil reserves, water resources, and fertile lands, significant growth is possible if violence is reduced and the capacity of government improves. For example, wheat yields increased more than 40 percent in Kurdistan during this past year.
The Iraqi government has also made progress in meeting benchmarks set by the International Monetary Fund. Most prominently, subsidies have been reduced—for instance, the price per liter of gas has increased from roughly 1.7 cents to 23 cents (a figure far closer to regional prices). However, energy and food subsidies generally remain a burden, costing Iraq $11 billion per year.
Despite the positive signs, many leading economic indicators are negative. Instead of meeting a target of 10 percent, growth in Iraq is at roughly 4 percent this year. Inflation is above 50 percent. Unemployment estimates range widely from 20 to 60 percent. The investment climate is bleak, with foreign direct investment under 1 percent of GDP. Too many Iraqis do not see tangible improvements in their daily economic situation.
Oil production and sales account for nearly 70 percent of Iraq's GDP, and more than 95 percent of government revenues. Iraq produces around 2.2 million barrels per day, and exports about 1.5 million barrels per day. This is below both prewar production levels and the Iraqi government's target of 2.5 million barrels per day, and far short of the vast potential of the Iraqi oil sector. Fortunately for the government, global energy prices have been higher than projected, making it possible for Iraq to meet its budget revenue targets.
Problems with oil production are caused by lack of security, lack of investment, and lack of technical capacity. Insurgents with a detailed knowledge of Iraq's infrastructure target pipelines and oil facilities. There is no metering system for the oil. There is poor maintenance at pumping stations, pipelines, and port facilities, as well as inadequate investment in modern technology. Iraq had a cadre of experts in the oil sector, but intimidation and an extended migration of experts to other countries have eroded technical capacity. Foreign companies have been reluctant to invest, and Iraq's Ministry of Oil has been unable to spend more than 15 percent of its capital budget.
Corruption is also debilitating. Experts estimate that 150,000 to 200,000—and perhaps as many as 500,000—barrels of oil per day are being stolen. Controlled prices for refined products result in shortages within Iraq, which drive consumers to the thriving black market. One senior U.S. official told us that corruption is more responsible than insurgents for breakdowns in the oil sector.
The politics of oil has the potential to further damage the country's already fragile efforts to create a unified central government. The Iraqi Constitution leaves the door open for regions to take the lead in developing new oil resources. Article 108 states that "oil and gas are the ownership of all the peoples of Iraq in all the regions and governorates," while Article 109 tasks the federal government with "the management of oil and gas extracted from current fields." This language has led to contention over what constitutes a "new" or an "existing" resource, a question that has profound ramifications for the ultimate control of future oil revenue.
Senior members of Iraq's oil industry argue that a national oil company could reduce political tensions by centralizing revenues and reducing regional or local claims to a percentage of the revenue derived from production. However, regional leaders are suspicious and resist this proposal, affirming the rights of local communities to have direct access to the inflow of oil revenue. Kurdish leaders have been particularly aggressive in asserting independent control of their oil assets, signing and implementing investment deals with foreign oil companies in northern Iraq. Shia politicians are also reported to be negotiating oil investment contracts with foreign companies.
There are proposals to redistribute a portion of oil revenues directly to the population on a per capita basis. These proposals have the potential to give all Iraqi citizens a stake in the nation's chief natural resource, but it would take time to develop a fair distribution system. Oil revenues have been incorporated into state budget projections for the next several years. There is no institution in Iraq at present that could properly implement such a distribution system. It would take substantial time to establish, and would have to be based on a well-developed state census and income tax system, which Iraq currently lacks.
The United States has appropriated a total of about $34 billion to support the reconstruction of Iraq, of which about $21 billion has been appropriated for the "Iraq Relief and Reconstruction Fund." Nearly $16 billion has been spent, and almost all the funds have been committed. The administration requested $1.6 billion for reconstruction in FY 2006, and received $1.485 billion. The administration requested $750 million for FY 2007. The trend line for economic assistance in FY 2008 also appears downward.
Congress has little appetite for appropriating more funds for reconstruction. There is a substantial need for continued reconstruction in Iraq, but serious questions remain about the capacity of the U.S. and Iraqi governments.
The coordination of assistance programs by the Defense Department, State Department, United States Agency for International Development, and other agencies has been ineffective. There are no clear lines establishing who is in charge of reconstruction.
As resources decline, the U.S. reconstruction effort is changing its focus, shifting from infrastructure, education, and health to smaller-scale ventures that are chosen and to some degree managed by local communities. A major attempt is also being made to improve the capacity of government bureaucracies at the national, regional, and provincial levels to provide services to the population as well as to select and manage infrastructure projects.
The United States has people embedded in several Iraqi ministries, but it confronts problems with access and sustainability. Moqtada al-Sadr objects to the U.S. presence in Iraq, and therefore the ministries he controls—Health, Agriculture, and Transportation—will not work with Americans. It is not clear that Iraqis can or will maintain and operate reconstruction projects launched by the United States.
Several senior military officers commented to us that the Commander's Emergency Response Program, which funds quick-impact projects such as the clearing of sewage and the restoration of basic services, is vital. The U.S. Agency for International Development, in contrast, is focused on long-term economic development and capacity building, but funds have not been committed to support these efforts into the future. The State Department leads seven Provincial Reconstruction Teams operating around the country. These teams can have a positive effect in secure areas, but not in areas where their work is hampered by significant security constraints.
Substantial reconstruction funds have also been provided to contractors, and the Special Inspector General for Iraq Reconstruction has documented numerous instances of waste and abuse. They have not all been put right. Contracting has gradually improved, as more oversight has been exercised and fewer cost-plus contracts have been granted; in addition, the use of Iraqi contractors has enabled the employment of more Iraqis in reconstruction projects.
International support for Iraqi reconstruction has been tepid. International donors pledged $13.5 billion to support reconstruction, but less than $4 billion has been delivered.
An important agreement with the Paris Club relieved a significant amount of Iraq's government debt and put the country on firmer financial footing. But the Gulf States, including Saudi Arabia and Kuwait, hold large amounts of Iraqi debt that they have not forgiven.
The United States is currently working with the United Nations and other partners to fashion the "International Compact" on Iraq. The goal is to provide Iraqis with greater debt relief and credits from the Gulf States, as well as to deliver on pledged aid from international donors. In return, the Iraqi government will agree to achieve certain economic reform milestones, such as building anticorruption measures into Iraqi institutions, adopting a fair legal framework for foreign investors, and reaching economic self-sufficiency by 2012. Several U.S. and international officials told us that the compact could be an opportunity to seek greater international engagement in the country.
The policies and actions of Iraq's neighbors greatly influence its stability and prosperity. No country in the region wants a chaotic Iraq. Yet Iraq's neighbors are doing little to help it, and some are undercutting its stability. Iraqis complain that neighbors are meddling in their affairs. When asked which of Iraq's neighbors are intervening in Iraq, one senior Iraqi official replied, "All of them."
The situation in Iraq is linked with events in the region. U.S. efforts in Afghanistan have been complicated by the overriding focus of U.S. attention and resources on Iraq. Several Iraqi, U.S., and international officials commented to us that Iraqi opposition to the United States—and support for Sadr—spiked in the aftermath of Israel's bombing campaign in Lebanon. The actions of Syria and Iran in Iraq are often tied to their broader concerns with the United States. Many Sunni Arab states are concerned about rising Iranian influence in Iraq and the region. Most of the region's countries are wary of U.S. efforts to promote democracy in Iraq and the Middle East.
IRAN. Of all the neighbors, Iran has the most leverage in Iraq. Iran has long-standing ties to many Iraqi Shia politicians, many of whom were exiled to Iran during the Saddam Hussein regime. Iran has provided arms, financial support, and training for Shiite militias within Iraq, as well as political support for Shia parties. There are also reports that Iran has supplied improvised explosive devices to groups—including Sunni Arab insurgents—that attack U.S. forces. The Iranian border with Iraq is porous, and millions of Iranians travel to Iraq each year to visit Shia holy sites. Many Iraqis spoke of Iranian meddling, and Sunnis took a particularly alarmist view. One leading Sunni politician told us, "If you turn over any stone in Iraq today, you will find Iran underneath."
U.S., Iraqi, and international officials also commented on the range of tensions between the United States and Iran, including Iran's nuclear program, Iran's support for terrorism, Iran's influence in Lebanon and the region, and Iran's influence in Iraq. Iran appears content for the U.S. military to be tied down in Iraq, a position that limits U.S. options in addressing Iran's nuclear program and allows Iran leverage over stability in Iraq. Proposed talks between Iran and the United States about the situation in Iraq have not taken place. One Iraqi official told us: "Iran is negotiating with the United States in the streets of Baghdad."
SYRIA. Syria is also playing a counterproductive role. Iraqis are upset about what they perceive as Syrian support for efforts to undermine the Iraqi government. The Syrian role is not so much to take active measures as to countenance malign neglect: the Syrians look the other way as arms and foreign fighters flow across their border into Iraq, and former Baathist leaders find a safe haven within Syria. Like Iran, Syria is content to see the United States tied down in Iraq. That said, the Syrians have indicated that they want a dialogue with the United States, and in November 2006 agreed to restore diplomatic relations with Iraq after a 24-year break.
SAUDI ARABIA AND THE GULF STATES. These countries for the most part have been passive and disengaged. They have declined to provide debt relief or substantial economic assistance to the Iraqi government. Several Iraqi Sunni Arab politicians complained that Saudi Arabia has not provided political support for their fellow Sunnis within Iraq. One observed that Saudi Arabia did not even send a letter when the Iraqi government was formed, whereas Iran has an ambassador in Iraq. Funding for the Sunni insurgency comes from private individuals within Saudi Arabia and the Gulf States, even as those governments help facilitate U.S. military operations in Iraq by providing basing and overflight rights and by cooperating on intelligence issues.
As worries about Iraq increase, the Gulf States are becoming more active. The United Arab Emirates and Kuwait have hosted meetings in support of the International Compact. Saudi Arabia recently took the positive step of hosting a conference of Iraqi religious leaders in Mecca. Several Gulf States have helped foster dialogue with Iraq's Sunni Arab population. While the Gulf States are not proponents of democracy in Iraq, they worry about the direction of events: battle-hardened insurgents from Iraq could pose a threat to their own internal stability, and the growth of Iranian influence in the region is deeply troubling to them.
TURKEY. Turkish policy toward Iraq is focused on discouraging Kurdish nationalism, which is seen as an existential threat to Turkey's own internal stability. The Turks have supported the Turkmen minority within Iraq and have used their influence to try to block the incorporation of Kirkuk into Iraqi Kurdistan. At the same time, Turkish companies have invested in Kurdish areas in northern Iraq, and Turkish and Kurdish leaders have sought constructive engagement on political, security, and economic issues.
The Turks are deeply concerned about the operations of the Kurdish Workers Party (PKK)—a terrorist group based in northern Iraq that has killed thousands of Turks. They are upset that the United States and Iraq have not targeted the PKK more aggressively. The Turks have threatened to go after the PKK themselves, and have made several forays across the border into Iraq.
JORDAN AND EGYPT. Both Jordan and Egypt have provided some assistance for the Iraqi government. Jordan has trained thousands of Iraqi police, has an ambassador in Baghdad, and King Abdullah recently hosted a meeting in Amman between President Bush and Prime Minister Maliki. Egypt has provided some limited Iraqi army training. Both Jordan and Egypt have facilitated U.S. military operations—Jordan by allowing overflight and search-and-rescue operations, Egypt by allowing overflight and Suez Canal transits; both provide important cooperation on intelligence. Jordan is currently home to 700,000 Iraqi refugees (equal to 10 percent of its population) and fears a flood of many more. Both Jordan and Egypt are concerned about the position of Iraq's Sunni Arabs and want constitutional reforms in Iraq to bolster the Sunni community. They also fear the return of insurgents to their countries.
The international community beyond the United Kingdom and our other coalition partners has played a limited role in Iraq. The United Nations—acting under Security Council Resolution 1546—has a small presence in Iraq; it has assisted in holding elections, drafting the constitution, organizing the government, and building institutions. The World Bank, which has committed a limited number of resources, has one and sometimes two staff in Iraq. The European Union has a representative there.
Several U.S.-based and international nongovernmental organizations have done excellent work within Iraq, operating under great hardship. Both Iraqi and international nongovernmental organizations play an important role in reaching across sectarian lines to enhance dialogue and understanding, and several U.S.-based organizations have employed substantial resources to help Iraqis develop their democracy. However, the participation of international nongovernmental organizations is constrained by the lack of security, and their Iraqi counterparts face a cumbersome and often politicized process of registration with the government.
The United Kingdom has dedicated an extraordinary amount of resources to Iraq and has made great sacrifices. In addition to 7,200 troops, the United Kingdom has a substantial diplomatic presence, particularly in Basra and the Iraqi southeast. The United Kingdom has been an active and key player at every stage of Iraq's political development. U.K. officials told us that they remain committed to working for stability in Iraq, and will reduce their commitment of troops and resources in response to the situation on the ground.
The United States has made a massive commitment to the future of Iraq in both blood and treasure. As of December 2006, nearly 2,900 Americans have lost their lives serving in Iraq. Another 21,000 Americans have been wounded, many severely.
To date, the United States has spent roughly $400 billion on the Iraq War, and costs are running about $8 billion per month. In addition, the United States must expect significant "tail costs" to come. Caring for veterans and replacing lost equipment will run into the hundreds of billions of dollars. Estimates run as high as $2 trillion for the final cost of the U.S. involvement in Iraq.
Despite a massive effort, stability in Iraq remains elusive and the situation is deteriorating. The Iraqi government cannot now govern, sustain, and defend itself without the support of the United States. Iraqis have not been convinced that they must take responsibility for their own future. Iraq's neighbors and much of the international community have not been persuaded to play an active and constructive role in supporting Iraq. The ability of the United States to shape outcomes is diminishing. Time is running out.
If the situation in Iraq continues to deteriorate, the consequences could be severe for Iraq, the United States, the region, and the world.
Continuing violence could lead toward greater chaos, and inflict greater suffering upon the Iraqi people. A collapse of Iraq's government and economy would further cripple a country already unable to meet its people's needs. Iraq's security forces could split along sectarian lines. A humanitarian catastrophe could follow as more refugees are forced to relocate across the country and the region. Ethnic cleansing could escalate. The Iraqi people could be subjected to another strongman who flexes the political and military muscle required to impose order amid anarchy. Freedoms could be lost.
Other countries in the region fear significant violence crossing their borders. Chaos in Iraq could lead those countries to intervene to protect their own interests, thereby perhaps sparking a broader regional war. Turkey could send troops into northern Iraq to prevent Kurdistan from declaring independence. Iran could send in troops to restore stability in southern Iraq and perhaps gain control of oil fields. The regional influence of Iran could rise at a time when that country is on a path to producing nuclear weapons.
Ambassadors from neighboring countries told us that they fear the distinct possibility of Sunni-Shia clashes across the Islamic world. Many expressed a fear of Shia insurrections—perhaps fomented by Iran—in Sunni-ruled states. Such a broader sectarian conflict could open a Pandora's box of problems—including the radicalization of populations, mass movements of populations, and regime changes—that might take decades to play out. If the instability in Iraq spreads to the other Gulf States, a drop in oil production and exports could lead to a sharp increase in the price of oil and thus could harm the global economy.
Terrorism could grow. As one Iraqi official told us, "Al Qaeda is now a franchise in Iraq, like McDonald's." Left unchecked, al Qaeda in Iraq could continue to incite violence between Sunnis and Shia. A chaotic Iraq could provide a still stronger base of operations for terrorists who seek to act regionally or even globally. Al Qaeda will portray any failure by the United States in Iraq as a significant victory that will be featured prominently as they recruit for their cause in the region and around the world. Ayman al-Zawahiri, deputy to Osama bin Laden, has declared Iraq a focus for al Qaeda: they will seek to expel the Americans and then spread "the jihad wave to the secular countries neighboring Iraq." A senior European official told us that failure in Iraq could incite terrorist attacks within his country.
The global standing of the United States could suffer if Iraq descends further into chaos. Iraq is a major test of, and strain on, U.S. military, diplomatic, and financial capacities. Perceived failure there could diminish America's credibility and influence in a region that is the center of the Islamic world and vital to the world's energy supply. This loss would reduce America's global influence at a time when pressing issues in North Korea, Iran, and elsewhere demand our full attention and strong U.S. leadership of international alliances. And the longer that U.S. political and military resources are tied down in Iraq, the more the chances for American failure in Afghanistan increase.
Continued problems in Iraq could lead to greater polarization within the United States. Sixty-six percent of Americans disapprove of the government's handling of the war, and more than 60 percent feel that there is no clear plan for moving forward. The November elections were largely viewed as a referendum on the progress in Iraq. Arguments about continuing to provide security and assistance to Iraq will fall on deaf ears if Americans become disillusioned with the government that the United States invested so much to create. U.S. foreign policy cannot be successfully sustained without the broad support of the American people.
Continued problems in Iraq could also lead to greater Iraqi opposition to the United States. Recent polling indicates that only 36 percent of Iraqis feel their country is heading in the right direction, and 79 percent of Iraqis have a "mostly negative" view of the influence that the United States has in their country. Sixty-one percent of Iraqis approve of attacks on U.S.-led forces. If Iraqis continue to perceive Americans as representing an occupying force, the United States could become its own worst enemy in a land it liberated from tyranny.
These and other predictions of dire consequences in Iraq and the region are by no means a certainty. Iraq has taken several positive steps since Saddam Hussein was overthrown: Iraqis restored full sovereignty, conducted open national elections, drafted a permanent constitution, ratified that constitution, and elected a new government pursuant to that constitution. Iraqis may become so sobered by the prospect of an unfolding civil war and intervention by their regional neighbors that they take the steps necessary to avert catastrophe. But at the moment, such a scenario seems implausible because the Iraqi people and their leaders have been slow to demonstrate the capacity or will to act.
Because of the gravity of the situation in Iraq and of its consequences for Iraq, the United States, the region, and the world, the Iraq Study Group has carefully considered the full range of alternative approaches for moving forward. We recognize that there is no perfect solution and that all that have been suggested have flaws. The following are some of the more notable possibilities that we have considered.
Because of the importance of Iraq, the potential for catastrophe, and the role and commitments of the United States in initiating events that have led to the current situation, we believe it would be wrong for the United States to abandon the country through a precipitate withdrawal of troops and support. A premature American departure from Iraq would almost certainly produce greater sectarian violence and further deterioration of conditions, leading to a number of the adverse consequences outlined above. The near-term results would be a significant power vacuum, greater human suffering, regional destabilization, and a threat to the global economy. Al Qaeda would depict our withdrawal as a historic victory. If we leave and Iraq descends into chaos, the long-range consequences could eventually require the United States to return.
Current U.S. policy is not working, as the level of violence in Iraq is rising and the government is not advancing national reconciliation. Making no changes in policy would simply delay the day of reckoning at a high cost. Nearly 100 Americans are dying every month. The United States is spending $2 billion a week. Our ability to respond to other international crises is constrained. A majority of the American people are soured on the war. This level of expense is not sustainable over an extended period, especially when progress is not being made. The longer the United States remains in Iraq without progress, the more resentment will grow among Iraqis who believe they are subjects of a repressive American occupation. As one U.S. official said to us, "Our leaving would make it worse. . . . The current approach without modification will not make it better."
Sustained increases in U.S. troop levels would not solve the fundamental cause of violence in Iraq, which is the absence of national reconciliation. A senior American general told us that adding U.S. troops might temporarily help limit violence in a highly localized area. However, past experience indicates that the violence would simply rekindle as soon as U.S. forces are moved to another area. As another American general told us, if the Iraqi government does not make political progress, "all the troops in the world will not provide security." Meanwhile, America's military capacity is stretched thin: we do not have the troops or equipment to make a substantial, sustained increase in our troop presence. Increased deployments to Iraq would also necessarily hamper our ability to provide adequate resources for our efforts in Afghanistan or respond to crises around the world.