Two Years After the War

Last week, Diyala Province felt the benefit of American reconstruction money: two farm cooperatives got under way, providing a much-needed source of income for several families in the often violent province.

This week, the area felt the sting of the insurgency: A suicide bomber drove into an Iraqi Army checkpoint, killing several soldiers.

Two years after U.S. forces rolled into Iraq to depose Saddam Hussein, contradictory forces are tugging at the war-torn country. Iraqis turned out in droves to vote for an 275-member assembly that took its seats Wednesday. Many are enthusiastically tapping into a world long closed to them by sanctions – snapping up satellite TV dishes and imported food.

But an aggressive insurgency has stymied crucial tasks of rebuilding and providing security, disillusioning ordinary Iraqis who thought the U.S. presence would bring rapid change.

"There are some positive developments," says Rachel Bronson, a senior fellow at the Council on Foreign Relations. But "in the context of the security situation it's hard to say it's going well."

By now, military planners had envisioned a U.S. presence that was a fraction of the 150,000 troops currently in Iraq. Oil revenues and foreign business investment were expected to provide jobs and buoy the economy.

The U.S. Agency for International Development says it has spent some $4.8 billion so far on reconstruction projects across Iraq. But restoring basic services and creating new jobs is proving problematic.

"Everything shuts down without law and order," Ms. Bronson says. "It doesn't matter if you have jobs if you can't get to those jobs."

Indeed, few U.S. efforts are reaching into the country's most troubled areas. While restive Diyala has received aid to start its beekeeping and calf cooperatives, along with sewage improvements and assistance to local government, most projects are in relatively stable areas to the north and in some areas of the south, according to the latest USAID update.

Still, Iraqis have seen progress on a number of fronts.

While unemployment is about 48 percent, according to the Ministry of Labor and Social Labor and Social Affairs, salaries are higher for the jobs that are available, typically ones linked to the government. Salaries of teachers, bureaucrats, and policemen, have gone up, as have pensions. The starting salary of a policeman is about $220, enough for a family to live on and, to many Iraqis, worth the risk of being targeted by insurgents. Some pensioners and teachers have seen their income grow tenfold.

As a result, many families say they can now afford meat with most meals and a wider variety of fruits and vegetables. This, despite prices that have spiked by about a third on some food items, including meat, fruits, and vegetables, according to merchants in Baghdad. But canned foods, soft drinks, and bananas, virtually taxed out of existence before the war, are now available at a fraction of their Hussein-era prices.

Electronic equipment has also been flying off the shelves since the war opened borders once shuttered by sanctions.

Many Iraqis can also afford a mobile phone, a modern convenience banned under Saddam Hussein. Egyptian-owned Orascom Telecom, which provides mobile-phone service to Baghdad and central Iraq, had 82,000 subscribers at the end of 2003, the year the company began operating in Iraq. By November 2004, it had signed up 480,000 subscribers and is now planning to reach 1 million subscribers by the end of this year by spreading its services to southern and northern Iraq, according to the company's web site.

But Orascom's experience is emblematic of the problems facing those trying to take advantage of new opportunities.

Security problems have made it difficult for the company's workers, who have been kidnapped and shot at, to expand the network. Currently, it may require a dozen attempts before phones connect, and the network often doesn't work at all during large chunks of the day.