Déjà vu

A strong, very centralized government loses its power, the means of control break down. The "free market" is brought in with the conviction that it will solve all the economic problems.

But the result is other than predicted. Some people do very well, get rich quickly. Others fall by the wayside. Unemployment and misery shoot up amid areas of opulence. Crime increases as criminal gangs form.

We've seen it before in Russia. Now we're seeing it again in Iraq. An article from the Institute for War and Peace Reporting supplies some of the story:

- Government employees' incomes have "rocketed" as compared to under Saddam.
- The minimum pension paid to retired government workers has gone from around the equivalent of $1 a month to about $75 a month.
- The average salary for a municipal worker with 20 years of service has soared from about $1 a month to $100 a month.
- A builder's typical pay has tripled.
- In Sadr City, the price for a 150 square meter (about 1600 square foot) house has nearly tripled, to around 50 million dinars [almost $17,000).
- In the al-Jadeda district of Baghdad, prices for a 200 square meter (about 2100 square foot) home have hit 100 million dinars (about $33,000), a four-fold increase.

Meanwhile, there has been an "increase in crime and violence in the Iraqi street," including criminal gangs engaging in organized patterns of kidnapping for ransoms.

The IWPR article calls this a "paradox" that runs counter to people's expectations that an improved standard of living on the whole would lead to less crime. But I see no paradox here, nothing to confuse.

Not when unemployment is around 28%.

Not when Al-Mutamar, the daily paper of the Iraqi National Congress can report (via Iraqi Press Monitor, September 30) that

the UN's World Food Programme (WFP) said 25 percent of Iraqis depend completely on the food they receive as rations. Most of them sell some of the items to get other essential needs like medicine and clothing. In a pessimistic report, however, the WFP said the items distributed to the people are not enough to prevent bad nutrition.

Unemployment at 28% and a quarter of the population totally dependent on inadequate food rations of which they don't even get the full benefit because they have to sell some to get clothing and medicine. Meanwhile, others have seen their income go up three times, thirty times, a hundred times. A dramatically improved life for some, a deeper desperation for others.

An increase in violent crime a "paradox?" I don't think so. Like I said, we've seen it before.

Footnote: The article says that the Iraqi ministry of planning

believes that foreign investment in Iraq could play an important role in solving the unemployment problem - provided that investors actually employ Iraqis and do not import foreign labour.

If importing foreign workers is more profitable - as it must be since it's what been happening - just what makes the ministry think they'll do that if they're not required to?