An agenda for the Federal Reserve’s review of its monetary policy framework


An agenda for the Federal Reserve’s review of its monetary policy framework

At the anniversary of the war to overthrow Saddam Hussein, it’s clear that the post-invasion period has been far more difficult than anyone was led to expect by the Bush administration.

It also has been full of a number of U.S. mistakes, such as our failure to stop the looting and lawlessness on Iraqi streets in the days after the Baathist regime was toppled.

That said, there is plenty of reason for hope, and much going right today in Iraq as well.

In the security area, it will come as little surprise to most Americans that U.S. troop losses have not diminished much since Saddam Hussein fell last April. American fatalities continue at the rate of about 30 to 40 a month. Recent figures are similar to those of last summer, though thankfully not as bad as in November, when 80 Americans died in Iraq.

Other foreign countries have averaged about five fatalities monthly. And attacks such as suicide bombings against Iraqis have intensified recently, typically killing 100 to 200 innocents per month over the winter. Foreign civilians also have been targeted with increasing frequency, most recently at a hotel in Baghdad.

But there is some good news. The number of daily attacks on U.S. forces is down by about half from last fall’s peak, to about 20 a day. Total attacks on the coalition have declined as well. U.S. forces are now discovering about 75 percent of all “improvised explosive devices” before they can be detonated, a much better rate than last summer.

Central Command now estimates the number of hardened insurgents at 3,000 to 5,000. It has also suggested coalition forces are killing or arresting more than 50 insurgents a day, a total up considerably since Mr. Hussein’s capture in December. (Indeed, only 10 individuals from the original 55 on the famous “deck of cards” remain at large).

At that pace, one might think the war should be won by summer. But it is not clear if we are arresting many of the hardened core of fighters, made up of both Hussein loyalists and foreign terrorists, or simply those they pay or coerce into carrying out attacks.

Normal crime is still very high in Iraq, partly because Mr. Hussein let so many criminals out of jail just before the invasion. As best as we can tell, the annualized homicide rate in Baghdad is around 100 individuals per 100,000 population, several times that in the most crime-ridden U.S. cities. The rate appears to have declined by about one-third since its late-summer high, which is obviously encouraging. But most other forms of violent crime are not reported to have abated.

Moving to economics and quality-of-life indicators, here the overall story is that things are gradually getting better, but only gradually.

Unemployment rates, also notoriously hard to gauge accurately, appear to have declined somewhat in Iraq, from perhaps 60 percent shortly after the invasion to 40 percent to 50 percent today. Part of the reason is the large number of Iraqis hired by the Coalition Provisional Authority—200,000 in the security field and again as many in various types of governance jobs and reconstruction activities. This may be an artificial stimulus, but it is a needed and welcome one.

Electricity levels improved after the invasion, then reached a plateau throughout the summer and fall. Thankfully, they are now gradually increasing again. They have just reached prewar levels and, as repairs continue to be made, should increase another 25 percent or more by summer if sabotage can be contained. Water supplies and sewage services, availability of cooking and heating fuels and gasoline and diesel fuel supplies are typically slightly better than in the fall, but often only by 10 percent to 20 percent. Some are above levels of the late Hussein period, some still below.

Child immunization rates are up from perhaps 60 percent under Mr. Hussein to 75 percent today, and growing. About 20 percent of all schools have had necessary physical repairs to date, though virtually all are now open. About 90 percent of hospitals are now stocked with supplies as well as they were under Mr. Hussein, but that is not a very high standard to measure against. Air traffic is up twentyfold since the invasion; port traffic may now be slightly above late Hussein levels as well. Phone service is nearing its prevalence before the invasion; Internet service already exceeds it.

Overall, the glass in Iraq is probably about three-fifths full. Considering the growing strength of Iraqi security services and the fact that $18 billion in American money (as well as a few billion more from other foreign donors) is beginning to flow into Iraq, it is likely to get somewhat fuller soon.

Whether that will prove fast enough to prevent the Iraqi resistance from recruiting more members based on growing anti-Americanism, and to prevent the country from splitting apart into various ethno-religious blocs, remains to be seen.