- A reflection -
Almost two years had passed since the writing of this chapter. Although its ideas could have been better presented, they appear as valid today as they did at the time -
In brief, it was proposed that the West undertakes to purchase $50 billion worth of Iraqi-assembled manufactures each year over the next ten years.
The purpose? The assumption was that Iraq 's medieval problems cannot be resolved until its people are provided with the modern means of earning a living. That assumption stands.
A thriving manufacturing centre of the Middle East .… “What - Iraq ? Get out of here…”
“MADE IN IRAQ” A brand of technological excellence and a source of great pride to its people… “Gimme a break - this folk couldn't tie their goddamn shoelaces!”
Facetious, politically incorrect, culturally offensive, hugely insensitive - all of the above…But in the end, Iraq has failed the intellectual expectations of MODERNITY. It's the Iraqis, stupid…
Imagine the Iraqis waking one day to a message “50 BILLION DOLLARS” emblazoned across their blue skies. No, not a miracle long foretold…
It is the amount of “MADE IN IRAQ ” manufactures the West commits to buy each year for the next ten years on ALL WESTERN TAX EXEMPT basis.
And exactly who is that altruistic West? For all the practical purposes, only the founders and guardians of MODERNITY - the United States and Great Britain , possibly joined by Japan . No nose-pickers need to apply…
“Let's say this starts tomorrow - how do I make a dollar out of it?” you may now very sensibly ask.
It depends on what TALENT you'll bring to the table… If all you can do is get a container of Asian components for the Iraqis to put in twenty screws so each product becomes “MADE IN IRAQ” for tax purposes - then you're not contributing a great deal. Still, you'd have faced self-evident dangers and marketing such products should subsequently attract only 50% of any currently applicable WESTERN TAX.
However, if due to your entrepreneurial skills this “MADE IN IRAQ” product becomes 80% Iraqi sourced 5 years later, that kind of inspired stewardship deserves to be rewarded with a 100% REFUND of ANY WESTERN TAXES paid during that period.
wNow if you're a mid-tech company - electrical Tools or Appliances, then a back-of-an-envelope calculation should decide the merit of sourcing billion dollars worth of such products at first only assembled by the Iraqis -
“Hmmm… I'm paying well over $100 million each year in WESTERN TAXES on my China stuff. Heck, even if keeping my Iraqi fixers happy has to cost $25 million a year, then after a FULL TAX REFUND my company should still be a billion in front within ten years, and my retailers possibly double that. Yeah, why not run it past my execs and see how the sums stack-up”
wBut who is to build the now largely absent industrial infrastructure - the modern factories and ports, power plants, roads, etc…? These effortlessly materialise out of Forward Contracts whenever such Contracts are founded on solid TAX ADVANTAGES - a most fascinating spectacle of international Commerce.
Yet this can often be surpassed by an even greater, social spectacle - the supreme pragmatism with which Manufacturing and Commerce douse out the hateful flames of IDEOLOGIES.
Now take a glance at an illustrious page of Western History - “Japan , 1950”. Seeing nothing but impoverishment around yet aware just how significant Meiji Restoration had proved a century earlier, General McArthur called for help of W. Edward Deming - one of America's foremost experts in Quality Control. Deming's marching orders - “TEACH JAPAN QUALITY!” were to subsequently revolutionize the Art of Manufacturing not only in Japan but across the Western World. And surreal as it sounds, today's Iraq painfully awaits its OPERATION DEMING.
wBy the way, with the Quality of its products now providing an ornament to humanity - guess who is Japan 's highest Prize for technological excellence named after…
Bearing in mind that MODERNITY runs on Energy, how would OPERATION DEMING be viewed by the Big Oil?
wThe “worst”? Its executives would loath Iraq announcing “Oil is no longer our sole livelihood - we're now serious manufacturers able to negotiate our contracts from a position of strength …” Too bad.
wThe “best”? A “normal” Iraq - insofar as “normal” may apply anywhere in that time-warped Region, would mean long-term predictability. Historically, predictability and INVESTMENT had always been the best of friends.
On balance, Big Oil would prefer a lower but predictable long-term return to the higher-yield, but possibly bloodier short-term alternative.