Iraq’s financial free ride may be over

updated 12:00 a.m. ET April 15, 2008

WASHINGTON - Iraq's financial free ride may be over.

After five years, Republicans and Democrats seem to have found common ground on at least one aspect of the war. From the fiercest foes of the war to the most steadfast Bush supporters, they are looking at Iraq's surging oil income and saying Baghdad should start picking up more of the tab, particularly for rebuilding hospitals, roads, power lines and the rest of the shattered country.

"I think the American people are growing weary not only of the war, but they are looking at why Baghdad can't pay more of these costs. And the answer is they can," said Sen. Ben Nelson of Nebraska.

Nelson, a Democrat, is drafting legislation with Republican Sen. Susan Collins of Maine and Democrat Evan Bayh of Indiana that would restrict future reconstruction dollars to loans instead of grants.

An issue for both sides
Their bill also would require that Baghdad pay for the fuel used by American troops and take over U.S. payments to predominantly Sunni fighters in the Awakening movement. Plans are to propose the legislation as part of a war bill to cover spending through September.

Likewise, Sen. Carl Levin, D-Mich., chairman of the Armed Services Committee, said he wants to add a provision to a defense policy bill that would force the Iraqi government to spend its own surplus in oil revenues to rebuild the country before U.S. dollars are spent.

These senators, well-known war skeptics, could find allies in lawmakers who support Bush's current Iraq policies. In hearings last week, Joseph Lieberman, I-Conn., asked Defense Secretary Robert Gates whether Baghdad should start paying some U.S. combat costs, and Lindsey Graham, R-S.C., raised the possibility that an anticipated Iraqi budget surplus this year could be used to help Afghanistan, whose $700 million in annual revenue represents a small fraction of Iraq's $46.8 billion budget.

Bush has suggested that Congress is preaching to the choir. Last week, he noted that Baghdad's latest budget would outspend the U.S. by more than 10 to one on Iraq reconstruction, with American funding for large-scale projects "approaching zero."

"Ultimately, we expect Iraq to shoulder the full burden of these costs," he said.

But lawmakers are dubious. Considering that past predictions on Iraq have fallen short, the legislation would ensure Iraq assumes more of the financial burden, they say.

Splitting the costs so far
On the surface, it looks as though the U.S. has about split the costs of rebuilding efforts with the Iraqis: Congress has appropriated about $47.5 billion since 2003 while the Iraqis have budgeted $50.6 billion. International contributions have totaled $15.8 billion.

And, as Bush pointed out, Iraq's latest budget is on track to outspend the U.S. when it comes to rebuilding. Baghdad has devoted $13.4 billion in 2008 for capital expenses, more than a quarter of its $48.6 billion budget.

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