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Iraq's Federalism Quandary
Iraq's Federalism Quandary

Iraq's Federalism Quandary

Originally published in The National Interest

With U.S. combat troops out of Iraq and that country facing an uncertain future, many challenges hover over the lands of old Mesopotamia. The most ominous is the unsettled struggle over power, territory and resources among the country’s political elites. While often described in straightforward ethnic and sectarian terms, this strife has gone through many phases. Various alliances have come together and broken apart as the power struggle has shifted from a sectarian street war to heightened tensions between Baghdad and the Kurdistan Regional Government (KRG) in Erbil. Most recently, the main axis of confrontation has been between Prime Minister Nouri al-Maliki’s Shia-led government and its putative governing partner, the mostly Sunni Iraqiya list.

One constant that complicates this maelstrom is the unresolved question of what kind of federal structure the new nation should have—essentially, the power-sharing arrangement between those who rule Baghdad, the autonomous government in Erbil and the country’s provincial leaders.

Within this puzzle reside a number of interlocking quandaries. For example, it is grudgingly accepted that the Kurds in northern Iraq should be able to retain the level of autonomy acquired after the Gulf War in 1991. But the details of this arrangement remain in dispute, and it raises some difficult questions: Would Iraq remain viable as a country if other provinces were to pursue similar autonomy? Even in the context of the Kurdistan region, can revenue-sharing arrangements that respect both Kurdish autonomy and Baghdad’s basic sovereign prerogatives be crafted? Would those same arrangements work for oil-rich Basra in Iraq’s South or gas-rich Anbar in its West?

These are not dry, structural matters. They drive deeply into emotionally held convictions on all sides. Iraq’s new constitution describes the country as a federal state, with significant grants of autonomy to Iraqi Kurdistan as well as potentially to future regions throughout the country. But the word federalism remains one of the most charged in the Iraqi political lexicon.

For Kurds, federalism has almost acquired the status of a religious belief system because it is tied to their century-old quest for their own state. But for many Iraqi Arabs, federalism is seen as synonymous with partition. Especially among Iraqi nationalists, there is fear that if the Kurdish federalist vision is implemented, it would bring about what Peter Galbraith, a controversial and influential advisor to the KRG, called “the end of Iraq”.

So far, this fundamental question of governance has generated little more than stalemate. Agreement between the federal government and the KRG on the final contours of their relationship has proved elusive. This stalemate is most consequential in the realm of oil and gas development, which will generate an estimated $1 trillion in revenue over the coming decade. The KRG has proposed a revenue-sharing regimen that not only would protect Kurdistan’s share of the pie but also would reduce the federal government to little more than a cash clearinghouse that disburses oil and gas revenue around the country. Not surprisingly, this proposal is totally unacceptable to Maliki’s regime. In the meantime, the KRG moved defiantly to sign contracts with more than twenty-five international oil companies, including, most recently, the world’s largest, ExxonMobil. Baghdad has rejected the contracts on grounds that they require its approval. For good measure, it also blacklisted the companies that signed them (but has yet to decide what approach to take toward Exxon, which already has contracts in the South).

Meanwhile, the deadlock between Baghdad and Erbil has complicated efforts to establish a workable relationship between the state and Iraq’s other provinces. Given the strong association between federalism and the Kurds’ ultimate desire for statehood, almost any exploration of greater local autonomy by the provinces raises suspicions of a partitionist agenda.

In the current debate, the federalism dispute has come full circle. During the writing of the 2005 constitution—a period of intense civil strife—a powerful group of Shia Islamists openly championed the Kurdish-inspired model of ethnosectarian federalism as a hedge against the return of a Sunni strongman such as Saddam Hussein. Now, however, with U.S. troops gone, Iraq’s Sunni-majority provinces worry about an unchecked and autocratic Shia-led government in Baghdad. Despite their emotional attachment to the notion of a centralized Iraq, leading national Sunni politicians and local leaders have now challenged Baghdad by issuing symbolic declarations of provincial autonomy.

All this friction raises questions about whether the constitution contains intrinsic flaws that prevent accommodation. It is based on the idea that federalism should be symmetrical, meaning that levels of autonomy should be equivalent for all regional governments. And therein lies the conundrum. When the constitution was written, it was unrealistic to expect the Kurds to retreat from the self-governance they achieved through their long struggle and blood investment during the Saddam years. Their post-1991 Gulf War autonomy became the effective floor for regional authority in the constitution. But if the rest of Iraq were to get this one-size-fits-all style of autonomy, the survival not only of the central government but of the country itself could be threatened. Hence Baghdad’s hard line with Erbil and fierce response to any new regional initiatives.

We believe that rather than pursuing the principle of symmetrical federalism, Iraq should instead pursue a deliberately asymmetrical federal model under which the level of autonomy granted to the KRG would be exclusive. Such a model would recognize the unique oil-contracting abilities of the KRG while also safeguarding Baghdad’s fiscal and monetary powers as well as authority over oil contracting elsewhere.

According to this concept, Baghdad could negotiate with the provincial governments over precisely what level of autonomy they should enjoy. No longer would the Kurdistan example serve to complicate these separate discussions, and Baghdad would be freed from its current fears that this federalism conundrum threatens to turn Iraq into a mere agglomeration of competing regional entities.

Some might argue that the prospects are dim for implementing such a system at any point soon. To be sure, Iraq faces a number of daunting immediate challenges that in turn have spawned two disparate responses. One is that the only way to keep Iraq together is to fully implement the federal model in the constitution and give Sunnis, Shia and Kurds each the authority to run their own regional affairs—a notion known as soft partition by its American proponents. The other view is that federalism is the worst possible solution for Iraq’s current woes, as it would lead to division and sectarian war.

We believe neither represents a solution. Those who favor the first option should consider the sobering mix of violent protests, arrests and mobilization of state security forces that occurred after the diverse Sunni-Shia-Kurdish province of Diyala sought to declare itself an autonomous region in December 2011. What then might happen if identity-based federalism were attempted on a nationwide scale? Likewise, those who advocate delaying a discussion of federalism until more propitious times need to explain how growing discontent with Baghdad’s governance in non-Kurdish Iraq is to be kept from boiling over in the interim.

In the current strained environment, a system of asymmetric federalism may be the most practical solution for the problems that Iraq faces because it most accurately reflects the country’s enduring ethnic and political realities. No other model is likely to enable the country to reach an acceptable solution for Kurdistan while at the same time ensuring that the central government in Baghdad is viable enough to function. This is not to say that it will guarantee that Iraq comes together into a smoothly functioning democracy. The country’s constitutional flaws are symptoms of the tensions and animosities embedded in the polity, not their source. But it seems clear that the current federal concept retards efforts to resolve the high-stakes competition for power and resources. Removing that barrier could enhance prospects for resolving these conflicts in a reasonably amicable way.

Asymmetrical federalism is not a novel concept. It has been employed in several countries around the world to recognize diversity and manage internal conflict. The theoretical case for asymmetrical federalism in Iraq should begin with an examination of two main stylized models of federalism: “coming together” and “holding together”.

A coming-together model arises when a group of formerly independent or self-governing units join to form a new country. Classic examples include the United States, Australia and the UAE, which formerly consisted of seven independent sheikhdoms. Not surprisingly, those accustomed to ruling themselves are reluctant to abandon power to new national governments. Thus, these coming-together federations are relatively decentralized, with checks on the authority of the central government and the provinces running their own affairs. They also tend to be relatively symmetrical, with all provinces enjoying more or less the same privileges vis-à-vis the center.

In contrast, the holding-together model is usually an attempt to maintain the territorial integrity of an existing state. It often occurs in the case of formerly unitary countries that face ethnically or territorially based secessionist threats. In many cases, attempts are made to reconcile these groups through a grant of special autonomy. The result can be an asymmetrical structure, where the potential breakaway province enjoys heightened self-government compared to other territories in the union. While few countries are purely symmetrical, asymmetrical federations are distinguished by the deliberate nature of these special arrangements, which are protected in laws or the constitution. Recently, in the case of Banda Aceh and Indonesia, asymmetrical arrangements helped end a long-running internal conflict. In other countries, such as Spain, these arrangements have been used to forestall wider conflict by granting cultural and administrative autonomy to Basque and Catalan communities.

The puzzle of Iraq’s 2005 constitution is that it introduced a coming-together symmetrical model of federalism rather than building on the clear asymmetrical foundation of the Kurdish safe haven established after the 1991 Gulf War. An examination of the recent history of devolution in Iraq suggests that a holding-together asymmetrical model may better promote stability by serving the interests of all parties.

The genesis of Iraq’s new federal system lies in the aftermath of the 1991 Gulf War, when exile groups stepped out from the regime’s shadow of fear to plot its demise. They were a motley collection of secularists and Islamists, Arabs and Kurds, all with their own visions of a post-Saddam Iraq.

The Kurds had long aimed to build on an autonomy agreement negotiated with the Baathists in the 1970s that was never implemented. Motivated by their desire for a Kurdish state and the fresh horrors of a genocidal Iraqi Army campaign against them in the late 1980s, Kurds in the post-Saddam era pushed for something more extensive: an ethnically based confederation that would afford the Kurds maximum autonomy over their own affairs. The Kurds’ partners in opposition had not given the idea of federalism much thought, but many agreed.

A central ally to the Kurds in this quest was a party then known as the Supreme Council for the Islamic Revolution in Iraq (SCIRI). SCIRI was a Shia Islamist party established by the Iranians in 1982 during the Iran-Iraq War that was dedicated to overthrowing Saddam’s regime. It saw decentralization as both the best guarantee against a return to dictatorship and a good way to protect Shia interests in the new state. In 2007, SCIRI renamed itself the Islamic Supreme Council of Iraq (ISCI), deemphasizing its historical ties to Iran’s revolutionary regime.

ISCI and the Kurds’ calculations on federalism were not solely about identity. The Kurds saw in federalism the freedom to develop their local oil assets, which would allow them the ability to run their own affairs without being financially dependent on Baghdad. Meanwhile, the Shia region in southern Iraq that ISCI was to propose was not coincidentally home to the majority of Iraq’s vast oil reserves.

The United States, following its overthrow of Saddam’s regime in 2003, made no secret of its own preference for a decentralized Iraq, sharing with the opposition the view that this would prevent the return of dictatorship. From the start, the term used was federalism. With their close ties to the Bush administration, the Kurds and certain ISCI leaders returning from exile had a head start that allowed them to leave an outsized imprint on the new state structure. The areas outside the Kurdistan region, which had yet to produce homegrown parties, were not positioned to give strong expression to their populations’ wills.

Yet resistance to federalism began almost right away. Iraqi nationalists, many with links to the former regime, championed the state’s paramount unity but struggled to articulate a practical alternative to the previous, now-discredited centralization. They were joined by what remained of Iraq’s secular elite and important parts of the Shia clerical leadership. Moreover, some Shia Islamist political leaders outside ISCI, now well on their way to gaining significant power in Baghdad, sought to protect their new domain and began to suggest that Iraqis were not yet ready for federalism.

Notwithstanding these objections, the Kurds proved the best organized of the parties that came to the table to draft the new permanent constitution; they also benefited from their strong ties to the U.S. officials who midwifed the new text. The Kurds’ goal was to maximize their autonomy, even emphasizing that Iraq’s union was voluntary and could be reconsidered if Baghdad did not fully respect guarantees to the Kurds in the new constitution. They also promoted the sectarian regionalization of Arab Iraq to ensure that Baghdad would never regain the power to threaten Kurds.

As the drafting process unfolded, those opposed to federalism were so weak and divided that the Kurds and ISCI pushed through language establishing the formation of federal regions with equivalent powers to the Kurdistan region. With Iraq’s sectarian civil conflict brewing, ISCI tabled the proposal for the creation of an oil-rich, nine-governorate “super-region” in the Shia South that it aimed to govern and protect against insurgents operating in the Sunni heartland west and north of Baghdad.

The result was the 2005 constitution, which prescribes a federal system with two exceptional characteristics: It hollows out the national government through radical devolution to federal regions that can mostly ignore Baghdad on many important matters, including most importantly oil and gas management and revenue sharing. It also provides minimal barriers to prevent the provinces outside of Iraqi Kurdistan from forming new autonomous regions, either standing alone or in conjunction with other provinces, with no limit on their size or number.

From the start, these features raised sharp fears regarding the viability and unity of the new state, prompting a near-unanimous rejection of the new charter by the Sunni Arab community in the October 2005 constitutional referendum. In recent years, the Sunnis have been increasingly joined in their objections by most of the newly empowered Shia Islamist parties, which have grown accustomed to ruling Baghdad. Even ISCI, the principal Arab proponent of Kurdish-style federalism in the rest of Iraq, appears to have shelved its project for a Shia super-region in the face of popular opposition. A Kurdish constitutional veto, however, has so far prevented any meaningful reconsideration of Iraq’s new federal architecture.

At the cusp of the U.S. troop withdrawal in late 2011, Iraq found itself in a peculiar situation. The majority of its political class outside the Kurdistan region, including the most powerful actors in Baghdad, has publicly objected to the constitution’s basic structure. Yet an early review of the constitution in 2007, intended to broaden its appeal, quickly foundered. Partially this is because the review committee took a symmetrical approach. It proposed to adjust the balance of power not just between Baghdad and any future regions but also to bring the Kurdistan region into line with a more centralized state structure. The latter crossed a clear Kurdish red line, prompting the veto threat that killed the amendment process. No clear avenue now exists on how to address this short circuit.

After six years of experience with the implementation of the constitution, two things have become clear. First, the type of countrywide sectarian regionalization advocated by the Kurds and ISCI remains unpopular outside Kurdistan. Second, there is rising discontent in the provinces with Baghdad’s poor and nonresponsive governance. Especially over the last year, there appears to be a growing sentiment similar to that expressed by the governor of Nineveh, Atheel al-Nujaifi: the people of his province support giving the provinces greater power instead of creating independent regions, but if Baghdad does not respond, they might go down the latter path.

The stalemate between Baghdad and Erbil has hampered any response to these grievances. The Kurdistan region can veto any reconsideration of Iraq’s state structure—and the controversy over the Kurdish model of federalism tars any calls for devolution of authority and greater local control outside Kurdistan as promoting partition. Maliki has pointedly reacted to interest in decentralization, saying that the country is not ready for federalism in its western, central or southern regions and that differences should be addressed through common action on administrative deficits rather than by “division or secession.”

Yet in the past year, calls for new regions have grown louder as political disputes in the center contribute to more troubled governance. Meanwhile, a growing sense of political marginalization from Baghdad and victimization by government-controlled security forces continues to amplify interest in decentralization in the country’s predominantly Sunni West and Northwest.

Unsurprisingly, Kurdish leaders have sought to embrace renewed interest in decentralization as supporting their view of the Iraqi state, but there are key distinctions. The most obvious is the absence of an ethnic agenda. Calls for decentralization in predominantly Arab provinces are driven primarily by functional rather than ethnic motives: better government and more effective distribution of resources are the principal goals, rather than the creation of multiprovince autonomous cantons as a precursor to possible independence. Indeed, most Arab proponents of decentralization frequently distinguish their federalism projects from those of Kurdistan.

Decentralization appears to enjoy strong support in the southern oil-producing provinces of Basra, Maysan and Dhi Qar. The difference between the contribution to state revenues by Iraq’s richest oil province, Basra, and the development funds it receives through the federal budget has driven local leaders there to campaign repeatedly to establish the province as a separate federal region. Rumblings in support of decentralization have also been heard from Basra’s neighbors, with occasional talk of creating a three-province, oil-rich region. Meanwhile, in south-central Iraq, the Wasit Provincial Council has reportedly made a formal request to hold a regional referendum, and the Shia holy provinces of Najaf and Karbala have considered forming regions out of a desire for greater local control of the lucrative religious-pilgrimage trade.

But grassroots support for regionalization has not yet been sufficient to spur administrative change. Basra leaders failed in their 2008 attempt to secure popular support for a referendum on establishing the province as a region. Their most recent effort, in July 2011, was tellingly headlined in the Iraqi press as Basra “demands secession.” At the same time, the party that holds the reins of power in Baghdad, Prime Minister Maliki’s State of Law coalition, has neutralized southern proponents of local decentralization and tabled individual requests by Basra and Wasit to organize local referendums on becoming regions.

The most recent manifestations of support for autonomous regions in Iraq’s predominantly Sunni provinces are somewhat different, born of a pervasive sense of alienation and sectarian discrimination by Baghdad. Pro-federalism sentiment in the oil-rich Shia South may create huge uncertainty over the country’s economic future, but sectarian-tinged moves by Sunni-majority provinces to seek regional status and Baghdad’s strong response have left Iraq on a political knife-edge.

These tensions came to a dramatic head in October 2011 when, following a wave of arrests of alleged conspirators in a Baathist coup plot, the provincial government of Salahuddin, a governorate north of Baghdad, symbolically voted to become an autonomous region. Other Sunni-majority provinces, including Nineveh and Anbar, quickly said they were prepared to follow suit if Baghdad did not do a better job of responding to their demands.

The provincial government in Diyala, a mixed Sunni-Shia-Kurd province in northeastern Iraq, went a step further. In December 2011, it adopted its own symbolic declaration of autonomy. The blowback was troubling. Baghdad-controlled security forces were quickly mobilized to the province, thousands of Shia demonstrators stormed the provincial government headquarters, unidentified armed groups blocked major highways and members of the mainly Sunni political bloc that sponsored the measure fled the province ahead of arrest warrants. Almost simultaneously, serious disputes erupted between Maliki and two of the most prominent national Sunni politicians who had supported Salahuddin’s and Diyala’s calls for federalism. One of them, Vice President Tariq al-Hashimi, fled to the Kurdistan region to escape his own arrest warrant for alleged involvement in assassination plots. The other, a deputy prime minister, has had his cabinet participation frozen.

Some national-level proponents of decentralization for these provinces may indeed have the more pernicious agenda that Baghdad attributes to them: using federalism as a way to destroy Iraq’s new political order, with the hope that a new, Sunni-nationalist-dominated state can emerge from the embers. But in the midst of this controversy, it is important to recall that the driving local motive in Salahuddin and Diyala was not separation. Salahuddin’s council in fact emphasized that it wanted to remain part of a “united Iraq.” There also have been no explicit calls for the creation of a multiprovince Sunni region. Instead, provincial leaders in Salahuddin, Diyala, Anbar and Nineveh are looking at a single-province-as-region model, precisely to avoid accusations that they seek to destroy Iraqi unity.

Moreover, there is no consistent popular support for federalism in these provinces. In fact, powerful local tribes in Anbar have organized public protests against the idea of transforming their province into a region. Local opinion polls show frustration with the central government but no desire for Kurdish-style autonomy. Respondents consistently favor Baghdad’s control over oil revenues to protect national unity, but they also want greater local administration of basic services and reconstruction.

To fully appreciate how an asymmetrical model could address this impasse, consider how centralized administration of the governorates by Baghdad works at present. Governors and provincial councils have limited direct budgets, no control over local public-sector hiring and no formal say over projects undertaken by federal ministries within their provinces. In many cases, the bulk of the security forces operating in the governorates report directly to the prime minister’s office, and access to the minority share of capital-investment funds given to provincial councils requires a laborious series of approvals from multiple ministries in Baghdad.

In our view, the complaints of the Arab provinces of Iraq could be addressed through more empowered local administration, greater local say over security and greater distribution of oil revenues. And this in fact is close to what the heads of Iraq’s fifteen provincial councils outside the Kurdistan region laid out in a joint letter to Prime Minster Maliki last October, when they asked for more functional revenue sharing and a greater local say on both public-sector hiring and environmental and customs policy.

Finally, it is important to recognize that this is a markedly different prescription from the relationship between the federal government and the Kurdistan region. The gulf between the centralization endured by the provinces and the virtual autonomy enjoyed by the Kurdistan region leaves ample room for an asymmetrical model to raise the status of the provinces without approaching the kind of regionalization seen as a threat to national unity.

Iraq’s Kurds still dream of their own state, but for now their fortunes remain tied to Baghdad. Mostly because of their own restive Kurdish minorities, neighboring countries will simply not countenance an independent Kurdistan. In the meantime, nationalist Iraqis resent what they see as the Kurds’ influence over the constitution aimed at furthering their independence by hollowing out the Iraqi state. Absent a reset, this set of affairs is a recipe for what could be a perpetual cycle of recrimination and internal strife.

Some Iraqi nationalists may be starting to conclude privately that Erbil is more trouble than it is worth in terms of the country’s territorial integrity. But all must accept that whatever Kurdish nationalists may dream, both sides are stuck with each other for the time being. After decades of bloody armed struggle, it took the cataclysmic 2003 U.S. invasion for the Kurdistan region’s autonomy to be enshrined in the Iraqi constitution. A crisis of similar magnitude would be required for the Middle East’s century-old, post-Ottoman order to be shattered and international borders redrawn.

Short of apocalyptic regional war, reexamining the federalism question appears to be necessary for Iraq to move toward some degree of stability. The straightforward way would be a redrafting of the constitution with authority of the Kurdistan region and other provinces delineated in separate chapters. But Iraqi politics are much messier than that ideal. In 2010, the country spent more than nine months forming a still-incomplete coalition government—it is unlikely the same parties could successfully undertake a comprehensive constitutional overhaul.

A possible asymmetric solution must identify key areas of dispute and recast the debate to affirm the KRG’s autonomy without applying the same concept to other provinces and eviscerating Baghdad’s sovereignty. An elevated administrative status for the provinces could be negotiated among Arab parties and local leaders. Given the difficulties in wholesale revision of the constitution, this change would come via legislative and political means rather than a constitutional amendment.

This represents a second-best outcome but is realistically as far as the envelope can be pushed under present circumstances. Initial understandings could then be codified in the constitution once circumstances permit. Indeed, any progress must present benefits compelling enough to challenge the status quo. In other words, each of the three levels of government described in the constitution—provincial, regional and national—would need to see clear benefits from an asymmetrical system for the idea to gain traction.

The path to pursuing this complex trifecta is perhaps through a bilateral deal between Baghdad and Erbil on oil and revenue sharing, followed by constitutional amendments that remove the threat of Kurdish-style regionalization elsewhere in Iraq, especially by Iraq’s main wealth producer, oil-rich Basra. In order to accept these arrangements and put aside their current constitutional right to form autonomous regions, the governorates should quickly receive tangible administrative empowerment from Baghdad. The concrete proposals included in last October’s joint letter by the heads of Iraq’s fifteen provincial councils could form the basis of these latter talks.

Oil has been at the heart of the federalism dispute from the beginning. At present, with a standoff over legislation governing oversight of the hydrocarbon sector, a deal between Baghdad and Erbil on oil matters feels a long way off. But there are potential trade-offs that could improve confidence between the two sides and lay the groundwork for a more stable, asymmetrical federal system.

In its essence, such a deal would entail the federal government guaranteeing the KRG an automatic share of oil revenues, authority to sign oil contracts, and access to the oil- and gas-export infrastructure necessary to develop a long-term platform for self-governance. (The KRG is currently unable to export the oil it produces and its day-to-day operational funding is subject to the vagaries of Baghdad’s annual budgetary process.) In return, the KRG would recognize the center’s paramount authority on oil revenue handling and setting national oil- and gas-contracting standards. Kurdish leaders also would need to agree that these arrangements apply only to the Kurdistan region and undertake not to oppose laws or constitutional amendments that consolidate Baghdad’s oil and fiscal powers elsewhere.

Several factors could potentially make such a deal attractive to both sides. In the absence of an independent pipeline network to neighboring states, Kurdish hydrocarbon exports are dependent on infrastructure controlled by Baghdad. The KRG could build its own pipelines, but the Kurdish region is landlocked and can only export through Iran and Turkey. Both countries are wary of an independent Iraqi Kurdistan as a model that could inspire their own restive Kurdish minorities. A more promising option is a negotiated deal, where Kurdish exports could be guaranteed unfettered flow through the national Baghdad-controlled pipelines in return for the KRG conducting all crude sales through the federal government, with revenue collection through the federal treasury. This meets Kurdish export needs and recognizes Baghdad’s role in selling and collecting oil revenues.

Second, the present nationwide revenue-sharing scheme is a source of leverage for Baghdad. The next decade’s projected oil exports from central and southern Iraq will dwarf the best-case scenario for Kurdish production. In draft legislation, the KRG has sought to protect its share of this growing national revenue and control over how to spend it. But it has irritated Baghdad by insisting that spending authority be symmetrically decentralized across the rest of Iraq, which would leave the federal government close to penniless and hence powerless. Baghdad should offer a clear choice: Kurdistan can receive a guaranteed automatic share of national oil revenue, but only if it accepts legal arrangements that protect the central government’s fiscal power outside of Kurdistan. Alternatively, the Kurdistan region could become financially self-reliant, controlling all revenue and taxes collected within its boundaries, including from oil and gas—but give up any grants from the federal budget.

Finally, on the issue of oil-contracting authority, the KRG and the federal government should consider a compromise where Erbil gradually standardizes its oil-contract terms with Baghdad’s. In return, Baghdad would need to acknowledge the KRG’s autonomous licensing authority and stop blocking international investment in Kurdistan’s oil fields. Erbil would also recognize Baghdad’s right to oversee oil contracting outside the Kurdistan region, allowing Arab Iraqis to determine amongst themselves the federal government’s role in supervising southern oil and gas contracts.

Both Kurds and Shia Islamists intended for the new constitution to promote decentralization. Indeed, given the starting point, a highly centralized Saddam-era state, the KRG achieved remarkable success in introducing a federal structure that contains the basic features of a coming-together model: highly decentralized with existing and future federal regions granted the same powers. A chain reaction toward this outcome might even be initiated were a single additional province—perhaps oil-rich Basra—to successfully grasp the chalice of regional status.

Yet Iraq is not a set of former colonies or emirates coming together to form a new country. It is a ninety-year-old, historically centralized state that has grappled for decades with the latent Kurdish desire for independence. Moreover, Iraq’s oil and gas is geographically distributed in a way that highlights the country’s ethnic and sectarian fault lines. In this context, full local control of oil resources—a feature of symmetrical, coming-together federations such as the United States, Canada and the UAE—could be dangerously destabilizing in Iraq, leading to large regional wealth disparities. And radical decentralization is not popular among Iraq’s Arab majority—even as Sunni areas chafe under the perceived excesses of the new order.

The incentives generated by the 2005 constitution force Baghdad and Erbil to make a strategic choice. Under the charter’s most radical option, Kurdistan would establish some form of self-sufficient autarky. This would be a poor outcome for all involved. The KRG would need to raise capital for export pipelines, persuade hostile neighbors to accept Kurdish hydrocarbon exports and rely on its own comparatively meager revenues to fund its regional administration. In Baghdad, preoccupation with Arab-Kurdish tensions would stunt development of the state. In addition, with Erbil continuing to block constitutional changes, Baghdad could one day be gutted by new autonomy movements in oil-rich Basra or gas-rich Anbar. In contrast, by isolating and containing the dispute between Baghdad and Erbil, an asymmetrical model would reinforce Iraqi unity and free the rest of the country to choose alternative governance arrangements on their own merits. This could at least provide a framework to consider the grievances of provincial leaders and perhaps defuse the potentially grave crisis sparked by angered Sunnis’ symbolic declarations of autonomy.

In short, Iraq is a textbook candidate for a holding-together, asymmetrical model of federalism. Merely elucidating the concept will not lead to its implementation. But doing so may be a basis for reframing the debate to facilitate a workable and lasting solution to Iraq’s foundational issues.
 

Contributors

Program Director, Middle East and North Africa
JoostHiltermann
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Sean Kane
Senior Program Officer, the United States Institute of Peace
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Raad Alkadiri
Partner and Head of Markets and Country Strategies, PFC Energy
A car burns outside the UN headquarters at the Canal Hotel after a huge suicide truck bomb explosion rocked the building. Baghdad, Iraq, September 2003. AFP PHOTO/Sabah ARAR

Al-Qaeda’s Virulent Strain in Iraq

As part of our series The Legacy of 9/11 and the “War on Terror”, Joost Hiltermann argues that the U.S. invasion of Iraq gave rise to a fierce variety of Sunni Islamist militancy, one just as intent on killing Shiite Muslims as on fighting the U.S. occupation.

My friend Arthur telephoned me one summer morning in 2003, when I had just returned from Iraq, which had fallen into U.S. hands that April. Arthur was head of the refugee program at the Lawyers’ Committee for Human Rights. A decade earlier, he and I had travelled together to Iraq, Iran and Turkey to investigate the refugee crisis in the wake of the 1990-1991 Gulf War. Now, he said, he wanted to go to Baghdad for meetings about addressing the new war’s human cost. He asked me if he should bring a bulletproof vest. We at Crisis Group had raised the alarm about an incipient insurgency in Iraq, based on my observations during two visits since the U.S. invasion. But the situation in the capital, if chaotic, was still calm relative to what we did not know would soon transpire. I told him a vest would not be imperative.

A month later, Arthur was sitting in the office of the UN special representative, Sérgio Vieira de Mello, when a flatbed truck rumbled into the UN compound at Baghdad’s repurposed Canal Hotel, setting off a massive bomb that killed both men as well as twenty others. I try to salve my conscience by thinking a bulletproof vest would not have saved my friend, but I’ll never know for sure.

The Canal Hotel suicide bombing was the first such attack in Iraq after the fall of Saddam Hussein. Responsibility for staging it was claimed by Abu Musab al-Zarqawi, a Jordanian petty criminal drawn into jihadist circles in prison and to Iraq by the U.S. military occupation, just as fighters from around the Muslim world had flocked to Soviet-occupied Afghanistan a generation earlier. Two years earlier, al-Qaeda had established itself as a global brand with the 9/11 attacks in the U.S., targeting its “far enemy” – Western powers – in spectacular fashion.

The U.S. had responded to the attacks in New York and Washington first by invading Afghanistan, where the ruling Taliban were sheltering Osama bin Laden and his band, and then also Iraq. The connection between al-Qaeda and Iraq was not obvious and, as it turned out, largely non-existent, at least until the U.S. invasion itself attracted would-be jihadists to the country. The particular conditions prevailing in Iraq due to the U.S. invasion, and longstanding tensions between Iraq’s religious communities, allowed Zarqawi to build a strong al-Qaeda franchise, one more virulent in its sectarianism than bin Laden’s al-Qaeda, and intent on killing Shiites, in particular. Zarqawi deemed the Shiites apostates, a radical notion not commonly held by Iraqi Sunnis at that time. But he was able to rally Sunni support because of many Sunnis’ antipathy for Iran and their belief that Shiites had made common cause with Iraq’s neighbour during the eight-year war between the two countries in the 1980s.

Middle East and North Africa Program Director Joost Hiltermann while on a research trip to devastated Sinjar, Iraq, September 2016. CRISISGROUP/Noah Bonsey
As the sectarian war raged, Iraqi society transformed from diverse to deeply divided

Within a year, the insurgency that Crisis Group had seen coming was in full swing, aimed primarily at U.S. troops and the nascent Iraqi security forces. But Zarqawi’s group, which core al-Qaeda soon disowned for its freelancing and sectarian outlook, took over parts of the insurgency and turned them into something else entirely. By targeting Shiite clerics and houses of worship, as well as crowded marketplaces in predominantly Shiite neighbourhoods, this new al-Qaeda in Iraq (AQI) plunged the country into a vicious sectarian war. Shiite militias, some backed by Iran, responded to the killings in kind, attacking not just suspected AQI operatives but also the country’s Sunni population broadly speaking. The fight might have taken place even without AQI, given the U.S. occupation authority’s very public association of Sunnis with Saddam’s regime and its labelling of the country’s Shiites as oppressed – a narrative that the new ruling Shiite Islamist parties did little to discourage. But AQI was certainly the proverbial match that lit the oil-soaked tinder.

As the sectarian war raged, Iraqi society transformed from diverse to deeply divided, a change first expressed in the way Iraqis defined themselves. Apart from my visits to Iraq, I also attended a number of workshops with Iraqis in Amman, then my home base. Before 2005, these Iraqis, mainly politicians, technocrats and civil society figures, would invariably self-identify as Iraqis; then suddenly they began, as if by invisible hand, referring to themselves and each other as Sunnis and Shiites.

The U.S. killed Zarqawi in a commando operation in 2006; essentially leaderless, AQI did not regain its potency. It did not disappear, either, but survived as insurgencies worldwide often do: hidden in the countryside, popping out only to weaken the authorities’ morale through night-time raids on checkpoints, ambushes of patrols on major arteries and sometimes incursions into urban areas. But the damage to Iraqi society was done: the sectarian killing went on even without AQI’s bloodier operations to goad it, and now with Shiite militias predominant.

Fighting coursed through mixed Sunni/Shiite areas for some three years until the U.S. succeeded in restoring a measure of order through a new military approach – the “surge” – and its marshalling of Sunni tribal groups. These were motivated to fight AQI by the latter’s viciousness vis-à-vis those Sunnis who did not bend to its will. In 2012, AQI’s remnants fled to a Syria engulfed in civil war to recast themselves as still another new version of al-Qaeda. They soon split from core al-Qaeda more definitively to set up the Islamic State in Iraq and Syria (ISIS), capturing a good part of northern Syria, which they ruled with brutal hand before returning triumphantly to Iraq in May 2014. They then declared the establishment of a new caliphate in the territories they began “liberating” from Baghdad’s control – eventually, almost a third of the country.

In short, the U.S. invasion created a monster. Welcomed by many for overthrowing a horrid dictator, U.S. forces and the soon installed Coalition Provisional Authority (CPA) quickly made themselves unpopular through their inability (interpreted as unwillingness) to impose security, disbandment of the Iraqi army, sweeping ban of the Baath party, patronage and empowerment of Iraqi exiles, paternalism in governance (which the CPA’s incompetence made all the more galling) and disregard for Iraqi governing institutions that had remained functional despite Saddam’s regime’s violent rule. Even after the CPA dissolved, handing over the reins of power to an interim Iraqi government in 2004, the U.S. presence was hated and actively resisted by those who felt unfairly painted with the broad brush of collaboration with Saddam’s regime, a charge of which they deemed themselves innocent. For AQI, it was a perfect environment in which to thrive, capitalising on one group’s resentment and grievance.

Over time, Iraqi militants took control of AQI, giving it, and its successor ISIS, a predominantly Iraqi leadership possessing an Iraq-inflected ideology that was based partly in religion (a very narrow, some would say twisted, interpretation of Sunni Islam) and partly in Iraqi Arab chauvinism. Many of the group’s top cadres came from the ousted regime’s intelligence and security agencies. Today, after its territorial defeat in Iraq and Syria, the group’s remnants are back to playing the long game in a classic insurgency, roaming beyond the view of the authorities and harassing government forces with pinprick attacks in an attempt to rebuild the so-called caliphate’s old might.

The U.S. enterprise in Iraq was ill conceived and even more poorly executed

The fate of AQI and ISIS in Iraq is less relevant than the message their emergence sent. Virulent ideologies and violent actors are all around, but they need the right soil to blossom. Post-invasion Iraq provided it, as have many other war-torn countries and regions since then. Even if the U.S. had pursued a wiser policy focused as much on building a just society as on getting rid of an inconvenient enemy, it might still have struggled to achieve its ends. But despite all its protestations, bringing democracy to Iraq was never its central focus, and AQI rose in the chaos that it created.

The U.S. enterprise in Iraq was ill conceived and even more poorly executed. It allowed for some democratic processes to take hold, but these fell victim to the rampant corruption it also encouraged. I said at the time – and continue to strongly believe – it could never have succeeded, even with substantially more resources, better expertise and greater will. Much as the region’s governments cry out for reform, Middle Eastern autocrats will not be enduringly brought down by foreign hands, and especially not through half-baked plans that rely on very selective readings of history, the politicisation of ethnic and religious difference, and the promotion of some groups over others, with no quarter given. These are the easily exploited circumstances in which Zarqawi and his gang arose.

From the perspective of U.S. grand strategy, the Iraq gambit was a gratuitous act of self-harm, even if most Iraqis were deeply relieved to see the old regime gone, and even if many would still not want anything like it to return. It was a false response to the 9/11 attacks, as none of the organisers or perpetrators had any link to Iraq. It was a case of hubris that gave an ambitious jihadist group that had just carried off a dramatic attack on symbols of U.S. power the chance to spawn many would-be imitators, such as Zarqawi and ISIS leader Abu Bakr al-Baghdadi, in the Middle East and beyond. Further, it breathed new life into global jihadism after it lost its safe havens in Afghanistan and was largely on the run.

Following 9/11, the Iraq war became the first accelerator of jihadism, luring many younger people seeking a chance at heroism and martyrdom, as well as community and purpose. The Iraqi case also showed that while grievance played a major role in driving the insurgency – grievance against the U.S. occupation; against the Shiite Islamist parties that took control of the state, shunting the Sunnis aside; and against these parties’ principal sponsor, Iran – it took an externally introduced ideology, with its attendant spectacular attacks on selected targets, to provide the fuel that allowed the insurgency to spread and assume its virulently sectarian form.

Incongruously, AQI and, later, ISIS wound up strong enough to lead Iran and the U.S. to converge and sometimes even tacitly cooperate in their separate anti-jihadist efforts. Iran opposed the U.S. military’s presence in Iraq but not its help in fighting Sunni jihadists. For its part, the U.S. had been at odds with Iran since the 1979 revolution and the hostage crisis, but still could see benefit from Iran-backed militias upholding the ramshackle new order it had created in Iraq, especially in fighting a tenacious insurgency. It just preferred for these groups to be fully incorporated into, and controlled by, the U.S.-backed central state.

The Iraqi case shows that jihadists can be their own worst enemy through excess

The Iraqi case also shows that jihadists can be their own worst enemy through excess. Their savagery instils fear but it also alienates potential supporters, if not entire communities, for example when they impose harsh punishments for smoking or force families to give up their daughters in “marriage” to them. It is because of such practices that the U.S. military was able to mobilise the tribal groups that became known as the Awakening Councils or Sons of Iraq. AQI might have been a good deal more effective in winning over the population where it operated if it had moderated its version of Sunni Islamist thought or represented local grievances to attract, indoctrinate, equip and deploy the disaffected. Instead, AQI was the handmaiden of its own undoing. This experience taught some of al-Qaeda’s later franchises, such as Jabhat al-Nusra in Syria, to soften their approach to governance, thus burnishing their legitimacy and extending their rule.

Zarqawi died fifteen years ago, but his violent legacy outlives him. It is visible in fragile states and on battlefields throughout the Muslim world, as well as in cities in the West and Russia. Zarqawi did not invent suicide bombings, but he turned them into a routine transnational-jihadist weapon. He mainstreamed the targeting of civilians – an old practice of warfare controversial even within the jihadist milieu – in non-combat settings. And he pioneered the so-called double-tap attacks, setting off a second bomb once the earlier one had drawn first responders and people desperate to find their loved ones.

The notion that no one is safe, that the only rule is that there are no rules, is particularly frightening, including for humanitarian workers who, without a political agenda, seek to bring succour to war’s victims. One such person was Gil Loescher, who died in 2020 at age 75, a refugee expert who travelled the world to advise the UN. He wrote extensively on the threats his profession has come to face. “In the global war on terror, the line between humanitarian activity and military activity has become blurred”, he warned.

Loescher knew whereof he spoke. Of the eight people in Vieira de Mello’s corner office in the Canal Hotel when the truck bomb exploded, he was the only one to live, though he lost both his legs in the effort to extricate him from the wreckage. Despite his injuries, he continued his work in shaping international policies on refugee issues, including through his writings, thus allowing humanitarian agencies to better address the critical challenges that our increasingly complex world faces, and contributing to a legacy that – perhaps – can outlast Zarqawi’s.

[Dedicated to Arthur Helton, St Louis, MO, 1949 – Baghdad, 2003]