The Slog of Reconstruction

HEADNOTE

Violence, corruption and a critical people shortage imperil Iraq's future.

The massive nation-building effort under way in Iraq, led largely by the U.S. government and American contractors, has been beset

for almost two years by delays, insurgent attacks and corruption. Any one of these factors could derail the initiative, which aims to make Iraq an economic engine of the Middle East. Taken together, however, and in light of the findings of two new reports on the reconstruction, the future of rebuilding looks imperiled.

A number of factors are in play. For starters, in Iraq's cash-based economy, which ran on patronage rather than market principles, corruption is rife. The inspector general for the Coalition Provisional Authority, the former U.S.-led occupation force, has managed or coordinated more than no criminal investigations and has opened cases relating to 272 hot line reports of fraud, waste or abuse. The Iraqi government has charged Iraqi construction companies with equipment theft. And an Iraqi government official is suspected of pilfering $500,000 in funds set aside for local governance projects, possibly siphoning some of that money to insurgents.