July 29, 2003

Iraq Inc. or Iraq Shrugged?

The new conventional wisdom among the chattering and political classes is that America doesn't do "colonial" well...that we are not up to democratizing Iraq and thereby stabilizing the region.

Poppycock. Postwar WWII and Korea puts lie to that bit of hubris.

To be sure much has been opined that Japan and Iraq are not the same. Less than a week after the Iraqi mobilization began, Retired General Wesley K. Clark wades into the debate with a narrowly drawn essay in the Washington Post. Rubbish. Note that Clark carefully avoids the commonalities between Postwar Japan and Iraq.

However, let's first examine the negative similarities: Japan was a defeated nation, armed to the teeth. An aggressive, yet culturally isolated country with a language and customs in which we had little familiarity or expertise. Japan was a deeply divided society with punishing social structures, an inflexible religion and an honor-shame culture similar to the radical Muslim ideal, a culture so different than ours that the gulf seemed too wide to bridge. However as in the Middle East, we had no choice, Japan had to be reformed in a way that it no longer posed a threat to the US or it's neighbors.

Much has been written of MacArthur’s methods, however one feels about MacArthur and the military it shouldn't color the enormity of task and our accomplishments. We'll set aside the General and look at the policy.

From 1948 to 1950 Japan went from a nation unable to feed itself to one that doubled its industrial production and quadrupled its total exports. Since 1950 the economic success of Japan has been a continuing source of astonishment to the rest of the world. We took great pains to provide Japan with tools to succeed, often at a cost to our own industrial base. Roads were designed for driving on the left; this prevented our automotive industry from flooding the country with inventory. The steel industry was demilitarized and the strangle hold of the warlord zaibatsu broken. Power and telephones were restored to the European standard, allowing the Japanese electrical goods industry to flourish independently. Ironically, American industrial expertise and innovations that were rejected by corporate management and American unions led to the Japanese work-production model that was eventually adopted in the US as a countermeasure to Japan's domination of our electrical and automotive markets.

Japan of 1945 and Japan of 1952 were vastly different nations. In 1945 the occupation forces had set about demilitarizing and democratizing Japan, and concentrating the economic power of the zaibatsu, or family combines. Bremer's task is more daunting than MacArthur’s in many ways as he doesn't enjoy a complete truce or surrender of arms and the world's media will continue to focus on what it perceives as wrong rather than the non-sexy nuts and bolts of revitalizing Iraq's economy and rebuilding society.

Dr. Gerd Nonneman, a teacher of Middle Eastern politics at the University of Lancaster in Britain, agrees. He points out that in Iraq the leadership will be deposed and that new political structures will be introduced.

"It does mean that when you put a different administration in place, partly run by a civilian administration, partly by a military commander, you impose a new set of structures that is not going to be all that straightforward. You start with a divided society that has no recent experience of democratic participation or negotiations among themselves. And there are no clear structures ready-made. So it's going to be far more problematic than in the case of Japan."

Problematic, but not impossible, if we look a little deeper into the reconstruction of Japan a pattern emerges that will serve Iraq as well.

In postwar Japan civil liberties were emphasized Article 13 and 19 in the new Constitution, prohibits discrimination in political, economic, and social relations because of Race, creed, sex, social status, or family origin. Compulsory education was extended; efforts were made to make education more a training in thinking than in rote memory, and the school system above the six elementary grades was revised to conform to the American pattern. This last change produced great confusion and dissatisfaction but became so entrenched that it stood after the Americans departed. So successful was the integration of women into the postwar society that Japanese women's role extends to every corner of society and commerce. In fact Japanese women were given economic equality that still eludes their American counterparts.

Similar changes to the Iraqi educational system would reinforce democratic ideals, empower women, and provide a balance to the divisive, fatalistic religious education that is at issue in neighboring countries.

Japan's agriculture was the quickest of national activities to recover; the Australian's land reform plan was key. Within two years 2 million tenants became landowners. The American occupation immediately gained not only a large constituency, for the new owners had a vested interest in preserving the change, but also a psychological momentum for other changes they wanted to initiate.

Iraq's immense oil and gas reserves will provide a similar means to redistribute wealth from Saddam’s cronies and the Ba’ath Party to ordinary Iraqi’s.

What? No, I am not encouraging the socialization of the oil industry, but we must establish a means of common ownership from which all Iraqi's may financially benefit directly. A common financial incentitive to provide the necessary glue that may bind the various tribal/religious factions into a workable, stable relationship and long-term success in modernizing Iraq and send a warning shot across the bow of Saud Inc. that they cannot ignore…reform or perish in the sweeping modernization that begins in Iraq.

In postwar Japan, two additional factors were also in place. The emperor and the political elite were persuaded to go along with the occupation. At the same time, the Japanese population was united behind the hierarchical political structures. Once the Ba'ath Party is purged will a new elite emerge? This is probably the largest unknown at the moment.

Iraqi society is divided among three main ethnic and religious groups: the Kurds in the north of the country, Arab Sunnis in the center, and the Arab Shiites in the south. Are such divisions are likely to cause postwar conflicts inside Iraq? Perhaps, the key advantage in postwar Iraq is access to information. Japan was an isolated, feudal country. Critics seem to miss this key point: 1945 is not 2003. Modern communications provides the Iraqi street instant access to information. Iraqi's will quickly assess that resistance to reform is not to their economic advantage.

Another key difference that is in our and ultimately Iraq's favor is their high rate of literacy and the expertise to quickly rejoin the world economy. Friendly neighboring countries will also play a part that is ignored in the current woe-is-me hand wringing.

Iraqi-Kuwaiti relations post-Saddam may assist our efforts to reform Iraq and the area. In 1996 Nonneman opined:

The Future after Saddam ?

If a regime change did occur in Iraq, however, the potential for the development of Kuwaiti-Iraqi relations would be considerable. The first major change that might come about would be a different policy on the reparations issue. Some claims could be refined downwards, but more importantly, the time scale could be stretched and the share of these reparations as a proportion of Iraqi revenues could be reduced.

Secondly, one could expect a slow regeneration of trade and transshipment. Remnants of political distrust, along with the obstacle of the border defenses, and Iraq's initial economic weakness, would preclude a more speedy recovery of these links. Kuwaiti companies would be likely to be eager to participate in the construction business, provided satisfactory financing arrangements could be obtained. Iraq, particularly given its needs, would be a natural and rich market for Kuwaiti businesses, who would have been suffering a long period of recession since the invasion.

As regards oil policy - a key trigger to the crisis - it must be remembered that until the late 1980s Iraq and Kuwait were in fact coordinating their policies: conflict, in other words, is not inevitable. Yet it remains true that the two countries will continue to have diverging basic interests in this field. Kuwait is the typical large-reserve, low-population producer, able to take fairly low prices if this assures market share and future consumption. Iraq, with greater short- and medium-term revenue needs even in a peaceful situation, will naturally require higher prices. Nevertheless, as demonstrated by the Geneva agreement of 27 July 1990, accommodation is possible (provided the political stimulus not to find such accommodation is absent); an arrangement on those lines in the future remains quite conceivable.

Iraq would also become an active participant again in most of the regional functional organizations it was a member of until the 1990 invasion, leading to an increase in Iraqi-Kuwaiti contacts and cooperation in a multilateral framework.

Once the former leadership is deposed I predict that Iraq will quickly proceed to embrace reform at breakneck speed. Iraqi’s have crossed the Rubicon…a new society will emerge, of that we can be assured, what form that society takes will depend on our resolve and if we follow the example of previous successes or retreat to isolation.

Steven Den Beste has a must-read ongoing piece on Iraq-to-date.

Cox and Forkum take on the *scare quote* Quagmire *scare quote* question.

Posted by feste at July 29, 2003 12:36 PM | TrackBack
Comments

feste-

Followed link from Instapundit.

Good article. It's little wonder the critics of the Iraqi war and reconstruction choose not to make the comparison to Japan.

But one question I have as far as the economic/production comparison is the issue of oil. Japan (or N Korea and Germany) had no oil but had developed an incredible economic machine, albeit a military one in the years preceeding WWII.

Iraq, on the other hand, seemed to be mostly an oil producer economic model, like Saudi Arabia. Aside from pumping oil, which employs a small number of people, Iraq didn't seem to have an economic machine at all comparable to Japan or Germany. Talking about infrastructure, export industries, even work ethic. Apparently seems endemic in the Arab world, but especially challenging for Iraq's 50% unemployment rate.

It's been called the oil curse. Wonder how much of a factor that may be.

Good luck
Paul Shelton
paultalkradio@speakeasy.net

Posted by: paul at July 30, 2003 11:30 AM

Excellent question. Iraq has another natural resource that is more vaulable than oil: water.

With the application of modern technology the Tigris Valley could be the breadbasket of the Asian subcontinent and a player in the European food export market.

Indio and Imperial counties in Southern California and the Great Central Valley were as inhospitable as Iraq, they now produce a substanial percentage of the nation's fresh vegetables, fruit and agriculture export revenues. Agriculture was the building block that allowed California to develop industry and eventually the technology miracle that fueled the 90's boom. The key was water.

The Israeli model is a prime example of making the desert productive and with very little water. The Dutch and the Belgians are masters of intensive farming and aquaculture...they and the Israelis developed much of the technology that is used in Cailfornia. Both could be invaluable in assisting this tranisition, I believe they will grasp the opportunity once the politics cools off a bit.

We need to start thinking outside the oil box.

Iraq also has a well educated, sophisicated urban population. Technolgy could quickly utilitize this population to provide services to the emerging technology spreading throughout the region. We are rebuilding the telecom system to a standard that could make Iraq the satellite, teleco and data transfer hub for the Mid-East.

Look to India for this model. They are kicking our butts in the tech support arena.

The Arab world is creeping into the 21st century...some are being dragged kicking and screaming...but coming they are. Iraq is in a position to be at the vanguard of the economic and societal changes that will sweep the region...it cannot be turned back.

The real curse upon the Arabic peoples with oil reserves is their rulers and the lack of democracy.

Think Milo Minderbender. ;-)

Posted by: feste at July 30, 2003 06:29 PM

A few good points but just a few points you seem to miss,mostly in order of your knowledge of Japan....feudal in 1945?..please...divided society? perhaps social caste-wise but otherwise Japan is one of the worlds most homogeneous nations in the world, which as per my first point was unfied siince the Tokugawa Shogunate.And lastly, while there are ertainly some parts of the Japan post war reconstruction model that could be used, in hindsite it does not appear that any lessons are being applied effectively. Thankyou however on the interesting angle you provide.

Posted by: D.Johnston at September 30, 2004 06:01 AM

I was speaking to the political divisions after the surrender and the countryside was very much a different society than the cities in the 40's & the 50's. Feudal? No. I lived in Japan for three years in the late 60's and once you left the cities the politics and standard of living and changed dramatically, the rural perfectures struggled for resources as the urban industrial centers consumed resources and manpower from the rural population, as it does in any society making the transition to an industrial economic base.

I return every few years on business the societal divisions are becoming more apparent as Japan's population ages. It will be interesting to watch the Japanese handle the same issue we are about to face, but without the vitality of a productive immigrant population.

Posted by: feste at September 30, 2004 06:39 AM
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