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Cronyism and Rebuilding

March 26, 2003

The Bush administration began handing out private contracts Monday to build water treatment systems, airports, bridges and other foundations of what President Bush envisions as a "peaceful and prosperous Iraq." The director of the U.S. Agency for International Development, Andrew Natsios, calls it "the largest disaster relief response we have ever put together."

No kidding. Since this nation's ultimate victory in the region rides less on the accuracy of its munitions than on whether it lives up to its stated ideals, the importance of the rebuilding effort can't be overstated.

The long-term battle to help Iraq is off to a bad start, however, with close U.S. allies like Britain fuming that the Bush administration has failed to involve them in the postwar reconstruction planning since in a secret process last month it invited a select group of U.S. corporations to bid for the tens of billions of dollars in work. The contracts, critics allege, could let the U.S. victors horde the spoils. The five companies that submitted bids -- Kellogg, Brown & Root, a division of Halliburton Co., the firm once headed by Vice President Dick Cheney; Bechtel Group Inc.; Fluor Corp.; Parsons Corp.; and Louis Berger Group Inc. -- gave $2.8 million in political donations from 1999 to 2002, 68% to Republicans and 32% to Democrats, according to the Center for Responsive Politics.

It's no surprise that Chris Patten, the European Union's external affairs minister, condemned the administration's slighting of European contractors such as ABB Ltd. and Siemens as "exceptionally maladroit."

The most worrying complaint comes from nongovernmental organizations that have been crucial to rebuilding Afghanistan but that so far have been shut out of any meaningful role in rebuilding Iraq. Take Oxfam, for instance. The relief group says U.S. officials have yet to grant it a license to operate in Iraq, even though it requested one in October. Oxfam has international legitimacy because it is not allied with national or partisan politics and has done humanitarian work successfully after wars in Afghanistan, Bosnia and southern Africa.

If Congress doesn't pressure the Bush administration to open up bidding and involvement in postwar construction to a wide array of the best-qualified groups, it will not have a chance to do so later. That's because the contracts give the primary contractors an extraordinary level of authority to choose subcontractors and others who will share in the work -- and the money to be made -- from rebuilding Iraq.

It's fine if rebuilding Iraq brings money back into the U.S. economy. But the Bush administration and Congress should also use the contracts as tools to revive some of the global alliances demolished in the run-up to war. As the administration sets forth its plans to rebuild Iraq, it should be keenly aware that the world is watching. The awarding of contracts must be seen as fair, with no bias toward domestic political friends, and based on which companies and groups can do the job well. The right reconstruction effort not only will help the people of Iraq start anew, it will be a tool to help repair frayed international relationships.

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