Pacific Views

Revealed! The secret paymaster for Iraq's insurgents.

Is it Osama? Or Iran? Nope, you're way off the mark.

It turns out that a major source of funding for Iraq's insurgency is the US treasury. According to a report by McClatchy's Hannah Allam, insurgents are financing at least part of their attacks on US forces by shaking down contractors in Anbar province. In return for cash (siphoned from US reconstruction funds), the insurgents allow contractors to move people and supplies, and carry out their projects with a modicum of safety. At minimum, this protection racket has generated hundreds of thousands of US dollars since 2003. It's more likely, say Iraqi government sources, that the figure is actually in the millions.

A U.S. company with a reconstruction contract hires an Iraqi sub-contractor to haul supplies along insurgent-ridden roads. The Iraqi contractor sets his price at up to four times the going rate because he'll be forced to give 50 percent or more to gun-toting insurgents who demand cash payments in exchange for the supply convoys' safe passage.

One Iraqi official said the arrangement makes sense for insurgents. By granting safe passage to a truck loaded with $10,000 in goods, they receive a "protection fee" that can buy more weapons and vehicles. Sometimes the insurgents take the goods, too.

"The violence in Iraq has developed a political economy of its own that sustains it and keeps some of these terrorist groups afloat," said Iraq's Deputy Prime Minister Barham Saleh ...

"I put it right in my contracts as a line item for 'logistics and security,'" said one Iraqi contractor who is still working for a major American company with several long-term projects in Anbar. "The Americans think you're hiring a security company, but how you execute it is something else entirely. This is how it's been working since Day 1."

One Iraqi contractor who is working on an American-funded rebuilding project in the provincial capital of Ramadi said he faced two choices when he wanted to bring in a crane, heavy machinery and workers from Baghdad: either hire a private security company to escort the supplies for up to $6,000 a truck, or pay off locals with insurgent connections.

He chose the latter, and got $120,000 for a U.S. contract he estimates to be worth no more than $20,000. The contractor asked that specific details of the project not be disclosed for fear he'll be identified and lose the job.

"The insurgents always remind us they're there," the contractor said. "Sometimes they hijack a truck or kidnap a driver and then we pay and, if we're lucky, we get our goods returned. It's just to make sure we know how it works.

"Insurgents control the roads," he added. "Americans don't control the roads — and everything from Syria and Jordan goes through there."

Despite the widespread and longstanding diversion of American money into insurgents' pockets, the US embassy in Baghdad refused to answer McClatchy's questions about the shakedowns. An embassy spokesperson said only that US contracts contain 'checks and balances' that prevent any 'irregularities' from occurring.

Yeah. Right. And this magpie is the f'n empress of the universe.

Via McClatchy Washington Bureau.

Posted by Magpie at August 28, 2007 02:53 PM | Iraq | Technorati links |