Iraq’s budget surplus
Why Baghdad is in the black while the U.S. is in the red
What happenedThe Government Accountability Office said that Iraq will have a budget surplus of up to $79 billion by the end of the year, as soaring oil prices fill government coffers. The U.S. has contributed $48 billion for Iraq's reconstruction since the 2003 invasion, while Iraq spends only a small percentage of its revenue on development. (The New York Times)
What the commentators saidBefore the Iraq invasion, you might recall, said David Wood in The Baltimore Sun’s Military Watch blog, senior U.S. officials promised that “Iraq’s oil wealth would pay for any reconstruction work needed.” Well, not quite. Five years later, U.S. taxpayers are still footing the bill for projects Iraq can now afford on its own, and worse, much of the $48 billion we’ve spent has been “misused or wasted.”
Despite the “outrage” these numbers have elicited, said Stephen Covington in the blog Conservative Pulse, a surplus is a good thing for “any fledgling democracy” learning to govern itself. For now, the Iraqi government lacks good accountants and accountability. But as soon as it can start spending the oil money it’s stashing “under the mattress,” without “half of it being stolen,” it should.
You could argue that the surplus means Iraq, unable to spend its own money, needs “more U.S. help,” said Mike Nizza in The New York Times’ The Lede blog. But with 90 percent of Iraq’s revenues coming from the oil, and surging oil prices wreaking havoc on the U.S. economy, more Americans will probably wonder why the record-deficit-saddled U.S. is throwing money at a solvent nation.