The 'Civilian Surge' at the Occupation HQ in Baghdad

President Obama has escalated the war in Afghanistan, killed at least 800 civilians in a major expansion of drone strikes in Pakistan, joined a new war in Libya with the U.K. and France, and expanded US Special Forces operations from 60 countries to 75 since he took office. As well as 9,000 JSOC forces in Iraq and Afghanistan, another 4,000 are deployed in other countries, but only Yemen, the Philippines, Colombia, Somalia and Pakistan have been named, leaving us to scratch our heads over the other 68 'secret' deployments.

Meanwhile Amnesty International laments that the United States remains an "accountability-free zone" for war crimes, with no officer above the rank of Major nor any senior civilian official convicted despite daily and systematic violations of the Geneva conventions and international human rights laws wherever U.S. forces have been deployed since 2001. And an expanding gulag of JSOC prisons in Afghanistan have replaced Bush's secret CIA prisons as the destination of choice for U.S. "rendition" flights from around the world.

But despite ratcheting up chaos and violence everywhere else, at least Mr. Obama is fulfilling his many promises to get the United States out of Iraq, right? Or is he? So far, he has complied with the SOFA agreement that the Maliki government wrung out of the Bush administration before it left office, by which all U.S. forces are required to be out of Iraq by the end of 2011. But that's not the whole story. U.S. troop withdrawals are being accompanied by a "civilian surge".

In my book, Blood On Our Hands: the American Invasion and Destruction of Iraq, I explained that only 24% of the money budgeted by Congress for "reconstruction" in Iraq was ever disbursed, and that much of that was diverted to the Pentagon and mercenaries in the name of security. In reality, instead of spending U.S. tax dollars to rebuild Iraq, U.S. officials and contractors stole Iraqi oil revenues to line their own pockets. Theft, embezzlement and mismanagement of Iraqi oil revenues from a fund set up by the UN was so rampant that it sent KPMG auditors to Baghdad to look for the missing money. When the auditors arrived in Baghdad, U.S. occupation authorities tried to deny them entry to the Green Zone.

Among many other findings, KPMG and a US special inspector general found that $8.8 billion of Iraq's money was unaccounted for; that customs officials in Lebanon found $13 million aboard Iraqi-American Interim Interior Minister Falah Naqib's plane; that Paul Bremer kept a $600 million slush fund with no paperwork; that a US Army officer doubled the price for some work on a hospital and told the hospital's director that the extra money, more than a million dollars, was his "retirement package"; that a U.S. contractor billed an extra $40 million for rebuilding a cement factory, then told Iraqis who complained that they should be grateful to the U.S. for "saving" them from Saddam Hussein; that a U.S. oil pipeline contractor was paid $3.4 million for work it didn't do; that 154 out of 198 contract files had no paperwork to show that the work had been done; that Iraqi oil was deliberately not metered, permitting $4 billion to be sold on the black market; and so on.

The special inspector general examined the records of American "paying agents" around Hillah, and found no accounting for $96.6 million in cash that they claimed to have disbursed. One agent alone could not account for $25 million. Another who was challenged over a $1.9 million discrepancy "found" the missing money and came back with it the next day. The Coalition Provisional Authority used paying agents like this all over the country. Only those around Hillah were audited. Many didn't submit any paperwork until they were about to leave Iraq, and the CPA just "cleared" huge sums of money.

But the United States has spent billions of dollars on construction at its own military bases in Iraq, and $736 million to build the crown jewel of the occupation, the new U.S. "Embassy" in Baghdad. This fortified compound is ten times the size of the largest real embassy in the world, the U.S. Embassy in Beijing. It occupies a 104-acre site that was once a nice public park on the bank of the Tigris. The land was given to the United States as a gift from its grateful Iraqi exile and Kurdish allies after the Americans captured Baghdad for them.

The contractor on the Embassy project, First Kuwaiti General Trading & Contracting, recruited workers from other parts of Asia by telling them they would be working in Dubai. At the airport in Kuwait, it confiscated their passports and loaded them onto aging, unmarked chartered planes bound for Baghdad. A supervisor from Florida described 2,500 workers living in squalid conditions with poor sanitation, cases of medical malpractice and managers who beat them regularly. Another supervisor said the workers were "treated like dogs." At least two workers died. The contractor only agreed to let some of them go home after the whole project was shut down by a series of strikes and escape attempts. The use of forced labor to build the U.S. "embassy" made Project Censored's annual list of unreported stories in 2008.

The "embassy" compound is cut off from the surrounding 4 square mile Green Zone by 15 X 9 foot concrete walls and a razor-wire-enclosed kill zone. Its 21 buildings include plush residences for senior officials, 619 one-bedroom apartments for other staff, office space for 1,000, a marine barracks, a social club and a swimming pool. As Iraqis struggle with power outages, contaminated drinking water and sewage in their streets, the American compound has its own power, water and sewage plants.

But what galls Iraqis even more is the very existence of this massive American fortress at the center of their capital city. They understand that it was not designed as a diplomatic mission to a sovereign country, but as a quasi-colonial headquarters from which its State Department staff planned to manage an Iraqi government that would be independent in name only for many years to come.

"In reality," I wrote in my book, "the United States was building a headquarters for a long-term presence in the heart of the Iraqi government, from which U.S. State Department officials could play a dominant role in the administration of a nominally independent country... The establishment of the occupation headquarters was a central and non-negotiable part of U.S. policy because it fulfilled one of the original, primary goals of the invasion, to establish a puppet Iraqi government supervised by American officials."

Neither the abysmal failure of this policy, nor the change from Bush's Republican administration to Obama's Democratic one, affected the U.S. commitment to this long-standing, primary goal of the invasion. In February 2009, newly appointed Secretary of State Clinton held a town-hall meeting for State Department personnel. One of the first questions was about the understaffing of U.S. embassies all over the world as a result of the bloated deployment of 1,200 State Department staff to the occupation headquarters in Iraq. Steve Kashkett of the American Foreign Service Association asked, "...have you had any discussions yet about reducing the size of our diplomatic mission in Iraq down to that of a normal diplomatic mission?" Clinton replied only that, "...we're just at the very beginning of that process."

An inspector general's report later that year also recommended reducing the number of staff at the Baghdad "Embassy", but the Obama administration instead announced a "civilian surge", a plan to increase the number of State Department staff deployed in Iraq from 1,200 to 3,000. This has been scaled back to 2,400, but even this doubling of the deployment means relying heavily on private contractors to fill the gaps in an already over-stretched State Department personnel pool. As U.S. military forces leave Iraq, the State Department is hiring a private army of 7,000 mercenaries to protect its quasi-colonial staff. It's submitted a laundry list of military equipment to be left behind by departing U.S. troops to equip its private army, including 1,320 armored vehicles, 60 mine-resistant ambush-protected vehicles (MRAPs), four aircraft and 29 helicopters.

But what is the point of this militarized deployment of quasi-colonial officials to a nominally independent country? The Maliki government has been establishing a minimum of legitimacy among the public in Iraq by distancing itself from its American puppet-masters and driving a hard bargain on the Status of Forces agreement, troop withdrawals and oil contracts. This makes the 'civilian surge' nothing but a futile and wasteful effort to salvage a policy that has already failed.

Western oil companies have already given up on the efforts of the U.S. Embassy staff to privatize the Iraqi oil industry, finally settling instead for service contracts worth only $1 or $2 per barrel for increases in Iraqi oil production. And the universal hostility of the entire population after years of brutal U.S. occupation means that American firms are virtually shut out of private-sector business in Iraq. New business is instead being snapped up by firms from Turkey, Iran, and even France and Brazil - anyone but the American occupiers!

U.S. firms still earn about $1 billion per year from government contracts in Iraq, but many of these date back to 2003 and will soon expire. In 2009, FedEx was forced to terminate operations in Iraq after a Russian firm won an exclusive air cargo contract. A $30 billion contract to rebuild Iraq's railroads was awarded to a British-Italian-Czech consortium. In November 2009, a European ambassador in Baghdad told the New York Times, "Being considered an occupier handicapped us extremely... The farther we are away from that, the more our companies can be accepted on their own merits."

By its brutal invasion and occupation of Iraq, the United States has squandered any chance to become a major commercial player there in the foreseeable future. The "civilian surge" is only consuming more of America's shrinking credibility and resources to rub this self-inflicted lesson into the Kevlar skin of our deluded leaders.

Nicolas J S Davies is the author of Blood On Our Hands: the American Invasion & Destruction of Iraq.