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Iraqi Economy Shrinking FastHuge Job Loss Despite U.S. Cash FlowFar from being a shining economic example for the Middle East as the president and his men have promised, the Iraqi economy is a shambles. "Six months after President Bush declared major military operations in Iraq over, the economy here is largely in stasis, propped up by American cash but showing little progress," says The New York Times. After visiting 30 towns and interviewing 600 people, a joint ABC News/Time magazine team reported on Nov. 10 that Iraqi unemployment tops 70 percent and says the job situation is worse than before the war throughout the country. Iraq was once one of the richest countries in the developing world, but in 2002 it ranked 162nd out of 200 countries worldwide in per capita production according to the CIA's world fact book. To prop up the economy and quell dissent, the U.S. has raised government wages and is paying tens of thousands of workers in state-owned shoe and other factories even if they perform no work. So little oil is flowing that it must be imported. Under Saddam Hussein, the price of food and housing was subsidized. The U.S. removed these subsidies, and the influx of U.S. dollars is fueling super inflation. Time reports the price of tomatoes in Karbala "has gone from 3 cents to 19 cents. A house in Kirkuk that rented for $12.50 a month now fetches $50." The clearest economic winners in Iraq are Bush political cronies. The Center for Public Integrity released a report on Oct. 30 showing that the White House awarded $8 billion in no-bid contracts in Iraq to 70 U.S. corporations that donated $500,000 to the Bush 2004 election campaign. Many Iraqi businessmen are resentful of the new development policy of relying on open foreign investment. Waleed and Hani Hafidh told The Los Angeles Times that the policy would destroy Iraq's private sector and create a permanent "world occupation" of its economy. |
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