Monday, December 29, 2003

Iraqi resistance forces US to drop privatization plans: "Plans to privatize state-owned businesses -- a key part of a larger Bush administration goal to replace the socialist economy of deposed president Saddam Hussein with a free-market system -- have been dropped over the past few months... "The Americans are coming to understand that they cannot change everything they want to change in Iraq," said Adel Abdel-Mehdi, a senior leader of the Supreme Council for the Islamic Revolution in Iraq, a Shiite Muslim political party that is cooperating with the U.S. occupation authority. "They need to let the Iraqi people decide the big issues.""

"With goodwill toward Americans ebbing fast, Bremer and his lieutenants have also concluded that it does not make sense to cause new social disruptions or antagonize Iraqis allied with the United States. Selling off state-owned factories would lead to thousands of layoffs, which could prompt labor unrest in a country where 60 percent of the population is already unemployed. An unwillingness to assume other risks has also scuttled, at least temporarily, plans to overhaul a national food rationing program that was a cornerstone of Hussein's welfare state. Several senior officials want to replace monthly handouts of flour, cooking oil, beans and other staples -- received by more than 90 percent of Iraqis -- with a cash payment of about $15. Although the proposal has the enthusiastic support of economic conservatives in the occupation authority, concerns about the logistics have put the effort on hold."

"Iraqi officials expressed further doubts about fast privatization. They argued that waiting for a year or two for Iraq to stabilize would increase the prices at which the government could sell factories. They also raised fears that former Baathists would use ill-gotten money to buy up state firms. In late July, the debate took a grim turn. After refusing to rehire dozens of workers who had been dismissed before the war, Aziz, the director of the vegetable oil company, was gunned down on his way to work. His killing sent a wave of panic through the Ministry of Industry. All of a sudden, no one wanted to talk about privatization. Faced with growing reluctance among officials at the ministry and on the Governing Council, Bremer and his advisers stopped advocating a fast sell-off of state firms. "It's just disappeared from the agenda," an official with the occupation authority said. "It was just too risky." "

Nowhere in this Washington Post article does it suggest that privatization may be against the interests of the Iraqi people and in favour of special and corporate interests.

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