Development-in-a-Box & Iraq

Stephen DeAngelis

December 13, 2006

During an interview on NBC nightly news following an earlier meeting with the President, retired Army General Barry McCaffrey indicated that he told the President that more money for and focus on reconstruction was needed. More people are coming to the realization that one key to stemming the violence in Iraq is convincing the local population that they have a real stake in helping promote peace and security [“To Stem Iraqi Violence, U.S. Aims to Create Jobs,” by Josh White and Griff Witte, Washington Post, 12 December 2006]. The Department of Defense is adding job creation to their list of non-traditional military tasks to help improve the situation.

Members of a small Pentagon task force have gone to the most dangerous areas of Iraq over the past six months to bring life to nearly 200 state-owned factories abandoned by the Coalition Provisional Authority after the U.S.-led invasion in 2003. Their goal is to employ tens of thousands of Iraqis in coming months, part of a plan to reduce soaring unemployment and lessen the violence that has crippled progress.

The philosophy behind this effort is simple. Desperate individuals with time on their hands are a likely source of trouble. In fact, White and Witte report that such individuals have accepted money to plant some of the IEDs that are being used to target coalition forces.

Other Iraqis are joining sectarian attacks because their quality of life has slipped dramatically, officials say. Army Lt. Gen. Peter W. Chiarelli, the top U.S. field commander in Iraq, said that tackling unemployment could do far more good than adding U.S. combat troops or more aggressively pursuing an elusive enemy. He said the project to open the factories and stimulate local economies is long overdue and was born “of desperation.” “We need to put the angry young men to work,” Chiarelli said in a phone interview from Baghdad. “One of the key hindrances to us establishing stability in Iraq is the failure to get the economy going. A relatively small decrease in unemployment would have a very serious effect on the level of sectarian killing going on.”

Jobs, of course, require a functioning economy and a functioning economy requires a stable environment. While that sounds like a Catch 22, the fact is economic development and stability must be pursued simultaneously. Getting people off the streets and involved in productive activities is critical. That means getting children back to school and their parents back to work.

The CPA initially hoped private investors would buy or lease the state factories, but that did not happen as security faltered and much of Iraq became inaccessible. As privatization hopes failed, the factories languished; some were in pristine form and others had been looted when the Pentagon task force examined them this fall. The tens of thousands of Iraqis who used to make them run — the country’s second-largest employment group, after the army — remained out of work. Pentagon officials say the vast majority of former Iraqi factory workers are still unemployed and are bringing in no pay. A small portion of the workforce receives government stipends, akin to welfare, but the pay system is badly flawed and provides about 20 percent of what the workers would make if fully employed, the officials said. Economic development is a departure from the military’s usual missions, but officials think the Defense Department’s heft as a consumer of goods and services can boost the effort. The department has been reaching out to U.S. companies that can place large orders for products from Iraq. … So far, members of the task force have visited 26 factories in some of the worst areas of the country, traveling to Baghdad, Fallujah, Mosul, Najaf and Ramadi to inspect facilities that make cement, tile, rubber and textiles. They have identified 10 factories — their “hot list” of facilities in both Sunni and Shiite areas — that they think could be open and employing more than 11,000 Iraqis within the next month.

Job creation, to be successful, must be sustainable. That means the factories must be run using best practices and produce quality products. The situation is perfect for a Development-in-a-Box™ approach that promotes exactly that. Some jobs can be like those created for the Civilian Conservation Corps as part of the New Deal designed to combat the poverty and unemployment of the Great Depression, but most of them need to be real jobs with real futures.

Stuart W. Bowen Jr., the special inspector general for Iraq reconstruction, whose office has been critical of the rebuilding effort, said that defense officials are “right on target in pushing this.” “It’s about stimulating interest and getting contracts going between U.S. firms and Iraqi firms. That’s the goal,” he said. “The solution in Iraq is not primarily a military one. It is primarily an economic and political solution.”

This is not an effort that the Pentagon should tackle alone. Development-in-a-Box stresses the importance of communities of practice and there are a number of stakeholders that should be included in the effort. Fortunately, it looks like that is taking place.

Bowen said defense officials recently met with about two dozen key business leaders at the U.S. Chamber of Commerce to gauge private industry’s interest in the program. He acknowledged that corruption and lack of security remain major obstacles to U.S. commercial investment in Iraq but said he is impressed that business leaders “recognize that and are still interested in moving forward.” Caterpillar Inc., a $36 billion construction equipment firm, is one of the first U.S. companies to show interest. Gerald L. Shaheen, a Caterpillar group president and chairman of the U.S. Chamber of Commerce, said he probably would be looking for low-tech supplies, such as hinges, but said the program dovetails with the company’s interest in expanding opportunities in the Middle East. “But I can’t look at this solely as a business proposition. I’ve already got suppliers,” Shaheen said. “I’m doing this because I think there’s a social responsibility not only to the Iraqi people but to our troops.” Dow Chemical Co., a $46 billion firm that sells plastics and other products in more than 175 countries, is also considering what supplies it can purchase from Iraq. “We see this as a positive initiative and very much hope that we can find the appropriate opportunities to support business activity in the country,” a Dow spokesman said.

Replacing fear and despair with security and hope is critical for success. The Iraqis have demonstrated time and again that they want jobs and are willing to work. Despite the dangers people have lined up to become police officers and garbage collectors. Let’s hope this latest program achieves its desired goals. Implementing the program using a Development-in-a-Box approach would help ensure that objective. I’m so convinced of the importance of the Development-in-a-Box approach that I’m working to get Enterra Solutions more strategically involved in this kind of post-conflict reconstruction work.