by by Steven Shafarman –

http://www.progress.org/2003/cd29.htm

The United States has a duty, we all agree, to help the Iraqi people rebuild as a peaceful, stable, and democratic nation. At the same time, the Bush administration is under enormous pressure to minimize spending for Iraq’s reconstruction and to get quick results so US forces can come home.

Everyone knows it will not be easy. After massive looting, weeks of war, and decades of oppression, many Iraqis are hurt, hungry, homeless, jobless. There are ethnic rivalries, distrust of former Baath party officials, self-proclaimed “leaders” competing for turf, and doubts about the role and intentions of US forces. Democratic government requires a vast civic infrastructure: laws, courts, police, schools, banks, postal system, communications media, and more. These institutions must be created and run by Iraqis; even the appearance of being imposed or controlled by the United States is sure to raise problems.

So how do we help the Iraqi people build a new Iraq? The simplest and most cost-effective approach is to hire them to do it. All of them.

For the past few weeks, US officials have been paying $20 — about half of the prevailing wage, which is $35 a month — to Iraqi civil service workers who return to work. When that began, retired Lt. Gen. Jay Garner estimated that 1.5 million to 2.5 million people are eligible. But what about the rest?

Iraq has a population of 24 million, although 42 percent are children; just 14 million are adults. So $20 a month for every adult Iraqi would cost less than $3.5 billion a year. Iraq’s oil royalties are estimated to be $10 to $15 billion a year; that, plus whatever the United States contributes, means plenty of money for a basic income along with substantial reconstruction.

The concept of a guaranteed basic income is not new. Versions have been proposed in the United States by political and economic leaders as diverse as Richard Nixon, Martin Luther King Jr., George McGovern, Milton Friedman, and Daniel Patrick Moynihan. In South Africa last year, a government commission recommended giving a monthly “basic income grant” of roughly $10 to every person age 7 or older ˜ just enough to ensure that people with no other income can afford to eat, making it possible for them to be productive in school and at work.

Something like that already exists in Alaska. Since the early 1980s, some of the royalties from oil production go into the Alaska Permanent Fund, which invests the money and pays an annual dividend to every resident. (The dividend in 2002 was $1,540.) The fund makes explicit the fact that Alaska’s oil belongs not to the government but to the people ˜ just as President Bush, Colin Powell, and other government officials have said Iraq’s oil belongs to the Iraqi people.

The basic income would promote local markets for food and shelter, and lessen reliance on national or international relief agencies. And it would ensure that every citizen could afford the time to participate in the hard work of democracy ˜ staying informed, debating issues, choosing candidates, voting, holding office. For every Iraqi, sharing directly in oil royalties would promote a sense of national unity and identity, reducing ethnic tensions and instability.

Even though basic income is universal and unconditional, it is not a socialist idea. It preserves markets and private property; indeed, it would strengthen markets by providing everyone with the means to participate. It would supplement, not replace, income from jobs and other sources, leaving intact the incentives to work, earn, save, and invest.

None of the oil-producing countries in the Middle East is a democracy or a free market. In every one, oil royalties go to some ruling elite and there are serious inequalities, especially involving women. The basic income approach would not only help Iraq become the first oil-producing free market democracy in the region, but also a role model for its neighbors.

The simplicity, cost-effectiveness, and common sense of this approach serve to call the administration’s bluff: Did we really mean to liberate Iraq? Did we really mean the country’s oil belongs to its people? Or what was the war really about?

Steven Shafarman is president of the Citizen Policies Institute. This article appeared in The Progress Report, an independent nonpartisan news daily. http://www.progress.org. This article can be viewed at
http://www.progress.org/2003/cd29.htm