- The Washington Times - Tuesday, May 27, 2003

STANFORD, Calif. — For U.S.-British coalition victors in Iraq, “As far as I can see, the first job is to create an orderly society. That’s the first job of any government,” former Secretary of State George P. Shultz told this correspondent in an interview at Stanford University’s Hoover Institution last week. “Life doesn’t go on unless there’s order,” he said. Concerning criticism in the U.S. and especially in Europe about failure to discover large caches of weapons of mass destruction, Mr. Shultz said, “I continue to think we will find evidence of weapons of mass destruction and may already have done so.”

Mr. Shultz, who was secretary of state in the Reagan administration, praised the appointment of L. Paul Bremer as chief U.S. civilian administrator in Baghdad. “It is good to hear him talking in uncompromising terms” about ending violence and theft, Mr. Shultz said.

Whatever the debate might have been two months ago, Mr. Shultz said, “We are where we are. What do we do?” He suggested identifying and using people who have had experience in re-establishing order in such chaotic circumstances: “I don’t know exactly who. The British are pretty good at it,” he suggested.

The U.S. administrators also need to make a major effort to secure the return of some of the stolen items. “Sometimes it’s hard to see the commercial value” of some of the items looted, he said, but they could be important in restoring some major civic services.

The first stage, he said, is to get some of these services such as water and electricity “running at all. But that’s not enough. There must be some way of taking elements off-line and getting them fixed,” while still providing enough services to run the cities. “Once you achieve the basics, all of a sudden life changes automatically.”

He said the job of restoring Iraq as a functioning society should be made relatively easier by the country’s “human capital, which I understand is impressive.”

“The oil wealth is a big issue, but that is something for an Iraqi government to decide. To maximize its value, they should want competitive bidding,” he suggested. Mr. Shultz also said the system for earning, banking and spending oil revenues should be “insistently transparent, so everyone can see. … I’ve often thought that something like a digital clock [such as those that show population growth and budget deficits] would be a good idea: showing how [money] is flowing in, and how much is going out.”

He noted that the Iraqi oil potential, said to be several times greater than official estimates, has never been measured or “addressed by sophisticated means.”

On the matter of international institutions and their involvement in the reconstruction of Iraq, Mr. Shultz suggested that “NATO is one place we should be looking to.”

As for the United Nations, where the U.S. often has been checkmated by nations, such as France, which opposed the coalition’s intervention in Iraq, Mr. Shultz took a broad view. “We need a United Nations. If one didn’t exist, we would have to invent it. The one we have has a lot of flaws. But if you were to reinvent the U.N., what you would come up with would be much like the one we have. What is needed is reform of the structure.”

Mr. Shultz recommended that the U.S. steadfastly challenge a lot of the rhetoric of the U.N. “We have to stand up and not just take a pass; challenge things like the Human Rights Commission [which includes a number of repressive regimes such as that of Cuba].”

One lesson we could learn from the French, Mr. Shultz is “the determination to get their way. They are willing to be disagreeable.” If the U.N. doesn’t adopt a more cooperative stance, “we should object and reduce our financial contributions.”

“The U.S. posture before the world,” Mr. Shultz said, “should be [we are] doing things that are in our interest, but also the interest of the world. Historically nations have reacted by deciding we have to fight terrorism, or try to get [it] to go over to someone else.”

He said he thought the president had it right from the beginning: “This will be a long struggle. We’re at war. Just as guilty [as the terrorists] are the states that harbor terrorists. With our forces there, we should be pretty tough,” he said, suggesting a hard line should be taken with those states to get them to neutralize or oust terrorists from their soil. “Our presence in the Middle East should be used as a pressure point to get them to shift gears. They are harboring terrorists. We know who and where.”

Next, he said, “we should figure out how to end the Palestinian refugee camps.” A big question is whether the Palestinians can stop the terror within Israel and the West Bank and Gaza.

Mr. Shultz recounted an episode to illustrate how terrorism can exhaust the patience of the Palestinian people. He said the son of a friend of his was aboard an Israeli boat off the Gaza Strip. Much fishing is done in the Mediterranean there, which provides badly needed food for the population.

The Israeli boat was approached by one of a number of fishing boats, and it turned out to carrying suicide bombers. His son’s friend survived, but there were numerous injuries to the Israelis. “And the predictable result was that the Israelis will close down the fishing business,” which is vital for the Gaza population.[The day after this interview, a number of Palestinians rallied to protest not Israelis but the actions of Palestinian terrorists that occurred elsewhere and disrupted their life].

“There are problems we can solve, and problems that can’t be solved,” Mr. Shultz continued. He compared the persistent effort needed to address terrorism with that needed to provide safety on the job at industrial sites. “The minute you think you have solved your problems, you’ve lost.

“Every day the first thing that has to hit people is [the issue of] safety. It’s not a problem that can be solved but we have to work at it forever. Get the back of it broken, but keep working at it. … ” He suggested the problem will diminish but perhaps trail on to some degree for a long time.

On Korea, Mr. Shultz said, “China has the most stroke [to bring North Korea into line]. What would motivate China? The prospect of a rearmed and remilitarized Japan, which has the potential of developing nuclear weapons easily. They [the Japanese] don’t want to do it, but if they feel continually threatened by missiles in North Korea, they’re bound eventually to do something.”

He also said the U.S. should talk to North Korea: “I would like to see a more up-front, active attitude about the eventual unification of Korea. North Korea is too unstable, unable to feed itself.”

Mr. Shultz, who also is a former treasury secretary and economic adviser, said: “As people feel we’re coming to grips with terrorism, that will be reassuring for the economy. The [recently passed] tax bill is the minimum that should be done. It’s really small in relation to the gross domestic product and in comparison to the JFK [Kennedy administration] tax cut.”

“I tend to be optimistic about the economy and think we should err on the side of stimulation. If we do too much, we can always correct it.”

But he noted that in today’s terms 21/2 percent growth is considered “lackluster,” whereas once it was considered optimal, and that 6 percent was once considered to be as low as unemployment could go to prevent inflation.

“The U.S. economy, relative to others,” he said, “looks fantastic.”

Benjamin P. Tyree is deputy editor of the Commentary pages of The Washington Times and was at Stanford University’s Hoover Institution last week as a media fellow.

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