Iraq and Afghanistan

Everyday life continues to go on for a remarkable number of people in Iraq. Today’s paper tells about the government’s distribution of food packets to everyone on the country, a process that has been going on with little or no interruption since 1991. At a cost of about $3.5 billion a year, the bureaucracy manages to continue this practice even in the most war torn areas, such as Falluja. The insurgents no doubt get their packets along with everyone else. Wealthier folk may sell what they do not need, but they are would also resist any attempt to stop the practice. Western economists chafe at the continuation of a practice that promotes continuing dependency and also reduces the motivation for local suppliers, including farmers, to increase production (because following pre-invasion practice, most of the food is imported). The government knows that it is in a bind, but it also knows that its support would be eroded even further were it to tinker with the practice.

Yesterday we read a newspaper account of the continuing desire of many Iraqi merchants to operate in the Iraq market. They often have their shipments stopped or stolen. But as one said, if it is just ordinary highwaymen, they can be bought off with a small sum. If the attackers are extremists, on the other hand, that is more complicated. It means going through the tribal chiefs and requires a larger payment. There was another account of a clothes dealer who was just about to make his annual trip to Italy to purchase the latest fashions for the Iraq market. Many of these people have lost family members, some have had to ransom relatives, some have sent their families to Syria. But they carry on. Apparently property values in downtown Baghdad rose rapidly after the invasion. They have cooled off somewhat now, but are still above pre-attack levels.