GREASING IRAQ'S POLITICAL TRANSFORMATION WITH OIL MONEY

• Document Type: FOIA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 06772450
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 3
• Document Creation Date: March 8, 2023
• Document Release Date: April 17, 2019
• Case Number: F-2019-00015
• Publication Date: October 1, 2002

Approved for Release: 2019/03/20 C06772450
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The Red Cell speculated on post-Saddam political options and prospects for democratic
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transition in an Iraq that has had no experierice of popular government
Quick Victory Mane Intset Elites
Iraq's history has been marred by deep differences among Its elite Sunni groups. In our
reading, the country has never developed a sense of nationhood that transcends key
famOles and tribes. Iraq has maintained its unity only by autocratic leadership.
� Iraq is bereft of political traditions like Afghanistan's Loya lima that might provide an
indigenous basis for democracy. And Saddam's active cultivation of and-Americanism
mixed with Iraqis traditional abhorrence of foreign domination�probably the most
potent unifying force in Iraq's history�poses a stubborn legacy, even If the
overthrow of Saddam himself is welcome.
� Exile organizations such as the Iraqi National Congress (INC) have little legitimacy
inside Iraq, where few are likely to accept the INC in leading n5RIS unless Imposed
by allied arms.
The quicker a military victory over Saddam, the more ilk* the Staml elites that play a
leading role under Saddam would remain in place, expecting to figure prominently In a
new order�particularly if they desert Saddam at the right time. Although the Sunni elites
have the expertise needed to keep the country running, most are also members of
Saddam% hated Beith Party. A longer, more destructive struggle would bring Iraq closer
to a clean sweep of the slate that would approximate Germany's "year zero' in 1945.
� An Iraqi general might present the US and allies with a real dilemma by simply
Mowing the precedents of Iraqi history, knocking off Saddam, and declaring
himself leader, backed by undamaged military units. Such a move would give the
international commtray the satisfaction of a Saddam-free Lraqwsflinqtosunener
its WMD but otherwise preserving Iraq's authoritarian regime
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After decades of repression and exclusion from power by successive Sunni Arab governments,
Iraq's other ethnic and religious groupings will be loath to reconcile with a regime identical to
its predecessor except for the dictator's absence.
� In the north, the Kurds have their own political institutions�two competing sets, in
fact�developed under the protection of US and UK air power. The Kurds are much better
prepared than other groups for Immediately assuming a post-Saddam polittal-Militerl
role. Anxious to press their political aspirations, they may act on 3 long-held desire for
independence despite the risk of armed Turkish intervention. The Kurds also pose a
threat to seize the rich oidiekb Immediately to their south.
� A majority of Iraq's population, the Shill of the south have long been suppressed and
are poorly organized to press their interests�a managerial gap Iranian hardliners might
be glad to fin as SaddaMt grip Is loosened. Longtime Shia resentment of their shabby
treatment by Baghdad�as well as by fdeign oppressors�might result in violence, as
was the case in 1991 when Saddam was vulnerable. To stave off trouble, Saddam has
retied more on�tribai sheiks in Shit/rens, which might provide a basis for a Shia political
role post-Saddam.
011 Revenue as Agent of Petition Change
.Using Iraq's oil wealth to facilitate a new political order may be a practicable way of easing
potential post-Saddam frictions. By tapping Iraq's oil money and giving key groups a stake in
how the revenues are used, the US and its partners might provide a major incentive for
cooperation among Iraq's competing Alined while, for a time, keeping decisive influence
in their own hands.
� Oil money is a traditional tool of control in the region and has provided a basis for
political legitimacy in Iraq and other oil rich states. Indeed, Iraq's oil wealth has
been one of its few sources of national identitY
� Although the danger exists that Saddam might by to destroy Iraq's oil production
capabilities, we believe that as Saddam% demise appears Imminent the odds will
increase that many tedviocrats would refuse to destroy their national
treasure�just as Speer and others refined to obey Hitler's l'scorched earth' orders
in 1945. Visible steps to protect the ofifields�either with military forces or a dear.
message to the workforce of rewards for those who hodthelrposts and punishment
for those who destroy fadlities�might reduce the risk.
After Saddam's ouster, the creation of a "petroleum board" consisting of key Iraqi political .
groups may be a way to help dilute the authority of any one group (especially remnants of
Saddam's regime who help the US and its paftners during the war), promote political
cohesion, and lay the groundwork for democratic development. Rather than turning the
revenues over to a new regime or having them directly managed by foreigners, key
post-Sacklam groups could be given a stake in dealing with resource sharing and the
compromises needed to make It work.
� In the post-Saddam era, without clandestine weapons programs and the dictator's
household expenses, Iraq will probably have more oil revenue evadable for the needs
of its populace. If Iraq's dl facilities remain intact, production might approach double the
current level. Income would receive anottierboost from eliminating discounts on Iraqi oil
sold in violation of sanctions.
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To complement an oil board that reaches out to key post-Saddam figures, states with financial.
and political interests in Iraq might be receptive to a UN-sponsored "Ireq Advisory �
Commission designed to link favorable domestic political change to the interests of important
outsiders. Such a Commission might be made up of states already on the ground with military
forces as well as others�perhaps Including Iran, Russia, and Turkey�that contributed to
Saddam's deposal and hold sped& equities In any succession arrangements.
� An -Iraq Advisory Oxitmission" might also link allocation of oil revenue to the repayment
of Iraq's foreign debts, which might speak to Russian and French calculations about how
far to support the poky of regime change.
In our reading of Iraq's likely post-Saddam environment, institutions Re a "petroleum board�
and an -advisory commission" offer several potential advantages:
� The key political players in Iraq would need to cooperate to get their share of oil
revenues. This would provide tangible economic Incentives for cooperation and for
� developing processes of political bargaining and compromise.
� As the petroleum beard helped restore order to Iraq% economic house, a measure of
�IxeathIng space � for building a new political order would result. Indeed, given the lack
of Institutions and traditions to build on�other than those dosely associated with
Saddam or the Kurds�a political process linked to oil revenues might buy the time for
new political groupings and personalities to emerge.
� A political transition based on bargaining over. oil revenues would, on the surface, look
familiar to Gulf states and may be more likely to win acceptance by reducing perceptions
that the US will impose a new political order. While US-UK predominance in an oil board
would be expected, transparency in dealings would show both Washington and London
to be "honest brokers� among post-Saddam Iraqi groups. This may allay concerns-in the
region and elsewhere that the real US goat is Iraq's oil wealth.
Such a scheme has associated risks, as would be the case with the creation of any institution
and its resulting politics. Indeed, post-Sacidam politics could be defined as opposition
to foreign-dominated institutions such as on on board, much as late 19A century Muslim
critics defined nationalist politics by opposition to the European-dominated debt commissions
that controlled Egypt and the Ottoman Empire and that were seen as serving the interests
of foreigners.
� In other states, oil boards have become corrupt and liable to be viewed as Serving
narrow political interests. To the extent an oil board is perceived as creating economic�
and political�winners and losers, a dangerous 'zero-sum" mentality might emerge and
play to old Iraqi suspicions. That said, as long as such debates transpire an open
environment by the US and its partners, a healthy learning process might
result.
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