Monday, June 06, 2005

Tighten the belt

According to the LA Times, those ungrateful Iraqis aren't reacting well to neoliberal austerity measures.

Iraqis, who are already dealing with food shortages, daily power blackouts and a deadly insurgency, on Sunday received another dose of bad news: Their newly elected leaders may slash budgets and government jobs.

Many fear that the move could cause impoverished Iraqis to sympathize with rebel forces. The new Iraqi government said it recently had deployed 40,000 troops in the capital to capture militants, who have killed more than 800 people in the last month in suicide bombings and other attacks.

...As many as half of Iraq's 6.5 million-strong workforce is employed by the state, thanks in part to ousted President Saddam Hussein, who increased the public payroll to mask unemployment and shore up a faltering economy.

Kubba did not say how many jobs could be eliminated, but he warned that budget cuts "will be a bit painful."

...Humam Shamaa, an economist with the Iraqi Institute for Future Studies, a think tank, said that each Iraqi without a paycheck is a potential recruit for well-funded militant groups.

Salaries account for only 20% of public expenses, Shamaa said. Iraqi ministry employees earn about $130 a month on average. He warned that with increasing food prices, 30% unemployment and 9 million Iraqis living below the poverty line, any budget cuts could push more Iraqis toward violence.

"We have to find jobs for people, not throw them out of work," he said. "I think that reducing the public sector will only encourage the insurgency."
Hi, Naomi. Where you been?