The drama of the recent capture of Saddam Hussein will likely serve as a short-term distraction from the broader challenge facing the administration of U.S. President George W. Bush: its continued search for a viable “exit strategy” from an Iraqi quagmire, its policy there is appearing ever more incoherent.

The latest example—and an especially spectacular one—took place December 10th when, at the same moment that Bush himself was personally asking key European and other leaders to forgive tens of billions of dollars in Iraq’s crushing debt, the Pentagon announced on its website that companies from the same countries will not be permitted to bid on $18.6 billion in reconstruction contracts there.

Needless to say, the Pentagon’s directive and its timing were unlikely to put the leaders of Russia, France and Germany—the most important of the excluded countries—in the mood to forgive a lot of Iraq’s debt. Even the deputy prime minister of Canada, another blacklisted country, suggested that Ottawa might have to reconsider its plans to add to the $190 million it has already contributed to reconstruction.

The New York Times reported that White House officials were “fuming” over the Pentagon’s announcement. Foremost among them, no doubt, was former Secretary of State James Baker who was spending his first day on the job as Bush’s special envoy for, of all things, reducing Iraq’s debt. Indeed, Bush was asking German Chancellor Gerhard Schroeder, French President Jacques Chirac, Russian President Vladimir Putin, among others, to welcome Baker when he comes calling.

But this embarrassing and potentially costly snafu is symptomatic of a larger problem faced by an administration that seems increasingly at sea over what to do about Iraq and whose constituent parts are trying desperately to protect their own interests.

An Occupation in Contradiction

This has become especially clear over the past month in Iraq itself where the U.S. military has adopted much more aggressive counter-insurgency tactics in order to reduce insurgent attacks against its own forces, even at the expense of the larger struggle waged by the Coalition Provisional Authority (CPA) to win the “hearts and minds” of Iraqis, including the residents of the so-called “Sunni Triangle.”

On the one hand, the CPA’s job is to convince Iraqis that U.S. troops are there to help them to rebuild and make a transition to democratic Iraq.

On the other hand, the military, which lost a record number of troops to hostile fire last month, is now embarked on a military campaign in the region that increasingly apes Israeli tactics. Razor-wire fences, checkpoints, night-time raids and roundups, bombing, and the demolition of houses and other buildings have never persuaded Palestinians that Israeli soldiers are in the West Bank to help them.

The CPA and the military now have “opposing goals,” noted ret. Rear Adm. David Oliver, who just returned from a high-level CPA job. While Gen. Ricardo Sanchez’s forces are focused on “tactical and immediate” goals of hunting down suspected guerrillas and maintaining order, CPA chief L. Paul Bremer is trying to win the confidence of the Iraqi people. “The military’s goal has nothing to do with the (Coalition’s) success,” Oliver said.

This incoherence — or rather the exasperating difficulty of reconciling military tactics to strategic goals — was best expressed this week by Lt. Col. Nathan Sussaman, the commander of a battalion that that has surrounded the town of Abu Hishma with a razor wire fence. “With a heavy dose of fear and violence, and a lot of money for projects,” he told the New York Times, “I think we can convince these people that we are here to help them.”

Incoherence of a third kind is reflected in the continuing bureaucratic infighting over power within Iraq that pits the neo-conservative hawks around Pentagon chief Donald Rumsfeld and Vice President Dick Cheney against the “realists” and regional specialists in the State Department and the Central Intelligence Agency (CIA).

While the neo-cons continue to try to bolster their favorites on the Iraqi Governing Council, primarily Ahmed Chalabi of the Iraqi National Congress (INC), the “realists” are more inclined to work with others on the Council, notably Ayad Alawi, leader of the Iraqi National Accord (INA), long a CIA favorite.

During the 1990s, the two groups, both of which boasted high-ranking secret contacts within the Iraqi army and intelligence services, competed for influence in Washington, but, with the empowerment of the neo-conservatives after 9/11 and Bush’s decision to give the Pentagon the lead in the war on terrorism, the INC became clearly dominant. The two groups fundamentally distrust and detest each other. The INC has always contended that the INA was heavily infiltrated by Iraq’s intelligence services and that, in any case, many of its operatives were Ba’athists whose democratic credentials were questionable at best. The INA, on the other hand, that the INC was essentially a vehicle for Chalabi’s personal ambitions as opposed to a movement that could mobilize significant sectors of the population.

Their major differences at the moment are over the CPA’s “Iraqification” plans. Chalabi, who helped persuade the Pentagon neo-cons to summarily disband the army after the war, has long called for a thorough de-Ba’athification of Iraq, particularly in the military and police. INA, on the other hand, has long argued that purges should be kept to a minimum in order to ensure the cooperation and loyalty of competent officials and military officers in post-war Iraq.

In the run-up to the next June’s scheduled transfer of sovereignty from the CPA to a provisional government, both parties are now pursuing their separate but largely contradictory agendas. While the Pentagon leadership continues to support Chalabi’s efforts to launch a wide-ranging de-Ba’athification by, for example, blacklisting companies close to Saddam Hussein for new contracts or sponsoring laws that would enable tribunals to prosecute even mid-ranking Ba’athist officials, Alawi’s INA is working with the CIA and U.S. military authorities in Baghdad to recruit former Ba’athist intelligence officials into a new service that is being deployed against the insurgents. INA has also lobbied hard for accelerating “Iraqification” of the army and security forces.

All of these incoherencies reflect the lack of an underlying strategy behind which the key factional interests back in Washington are united, a unity that has long eluded the Bush administration. And while Bush has clearly been tilting away from the hawks in favor of the realists over the past two months, incoherence is likely to persist so long as both forces retain the ability to undermine each other.

That Baker was the latest victim of this incoherence on his first day of work is particularly juicy. Of all Bush’s advisers, Baker—a dyed-in-the-wool realist who, as Ronald Reagan’s chief of staff and secretary of state during the first Gulf War, showed little patience for bureaucratic or ideological intrigue, least of all by neo-conservatives—may be very well-placed to correct the problem.

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