It appears that the Jafari government in Iraqi is facing pressure from the IMF and the neo-cons to cut the public sector by slashing jobs and generally cutting back on public spending. The LA Times LA Times quotes spokesperson Laith Kubba, "government ministries can carry out their duties with only about 40 to 60% of [their] employees." Hmmm...yeah.... Never mind that the Iraqi government is the largest employer in the country. Never mind that throwing all those folks out of work will just add to the already high (above 30%) unemployment rate.

And it's just not jobs that the IMF wants the Iraqi government to cut. I vaguely remember Bush & Co. promising us that Iraqi, once we got rid of Sadam, would be able to pay its own way. Guess that was just another lie cooked up and focus-group tested for our consumption.

"Kubba, who last week had discussed slashing popular subsidies for electricity and oil products, said that shrinking the government and allowing the private sector to expand would solve many of Iraq's financial troubles.

He said the nation was obligated to reduce public spending under a debt-reduction scheme sponsored by the International Monetary Fund."

Hmmm...sounds suspiciously like George Bush's solutions to our own economic problems. I can't wait for the Iraqi government to come out and proclaim high taxes the cause of all the violence. Though they are getting close to that as Kubba said, "Currently, Iraq is a huge welfare state." Yeah, well when car bombs, rifle fire, and mortar rounds landing here and there are a part of everyday life it's kind of hard to have a thriving market-based economy. Cutting public spending will do noting but send Iraq into a deeper tailspin of violence and despair. This isn't the time for neo-con fantasies. It's a time to use what little power the Iraqi government has to stabilize the situation. If that means keeping people on the government payroll then so be. If even 5% of those thrown out of a government job in order to please the IMF and some neo-con think tank in Washington decide to join the insurgents, then that is 5% too much. This idea that all government spending is inherently bad is just hogwash. We need to look at the benefits derived from government spending and look at the negative iimplications of cutting government spending. In Iraq's case, the argument that a bloated government is squeezing out private investment is almost criminal. It's hubris at it's worst to think that some economic scheme dreamed up in the backrooms of Washington think tanks by people who have no real knowledge of the situation and with no input from the people who live and deal with the situation everyday can be applied to situation a thousand miles away. It's the worst kind of Orientalism.

Now....go back to your T.V.--I think the Cubs are playing the Red Sox for the first time since 1918 and there should be a nice NASCAR race on this weekend or maybe that nice little hurricane will provide a nice little distraction. Whatever it is, don't worry too much about Iraq because the "experts" have all under control. And no matter what, don't worry about that housing bubble.
posted by Idle Crank at 6/11/2005 10:36:00 AM