Can Iraq win the war on corruption?

As Iraq resumes negotiations with the United States over the fate of the strategic relationship, hopes have been raised that the reformist Prime Minister Mustafa Kadhimi may finally be able to address the debilitating problems that have stymied the transition of the beleaguered country to democracy. The problems in particular are the entrenched sectarianism and the kleptocratic political system wasting critical resources.

Even in the time of the coronavirus, corruption is the central issue facing Iraq today. The protesters that toppled the previous government last year decried the incompetence and opacity of government institutions run by the elite. There were demands for jobs and a  broad movement rejecting the status quo. The anger caused by corruption was so intense that even brutal retaliation could not break the resolve of the protesters.

Kadhimi has won cautious approval from their movement. He has shown encouraging signs to address their key demands of pushing back against Iranian influence and rooting out corruption, and ordered a review of the government payroll to eliminate “ghost employees” and illegal duplicate salaries. He also carried out a raid against one of the Shia militias. Yet the path toward achieving meaningful reforms will be long and treacherous, as evidenced by the shocking assassination of outspoken security expert Hisham Hashimi, widely viewed as a warning shot to Kadhimi.

Almost two decades after the troubled transformation from dictatorship to aspiring democracy, governance is still debilitated by endemic graft. Despite vast oil wealth with the potential to benefit all citizens, the Iraqi state is essentially engineered to launder oil revenues through a bloated public sector for political parties based on patronage and the parastatal armed forces while avoiding any form of real accountability.

The pandemic and plummeting oil prices have placed new strains on the Iraqi state, exposing the corrosion of public institutions, such as medical schools and hospitals, an inevitable byproduct of squandered revenues. Hospitals and private clinics have been overwhelmed by the scale of the crisis, lacking therapeutic medical supplies and even personal protective equipment for thousands of doctors, nurses, and other staff.

The inevitable fall in revenues has made it impossible for the government to prop up what is left of its safety net, and any belt tightening is likely to ignite anger considering that about half of the Iraqi budget goes to state salaries, pensions, and benefits for government workers. The severe risks of unrest and financial collapse are real, as the challenges magnify each other, compounding the public distrust in state institutions.

The power sharing system is the most intractable obstacle. At the root of the corruption is muhassassa, an informal consociationalism adopted in 2003 which prioritizes party interests over technocratic competence. It has ushered in a political culture that divides government power among party members who hold the authority to appoint some 800 civil service positions across ministries during the cabinet negotiations.

With every election, each party has used its ministry to employ more and more members and followers. This has therefore expanded the payroll and ultimately conditions access to the job market, which the state dominates, on allegiance to party. The payroll has ballooned from 850,000 workers in 2004 to more than seven million workers in 2016, with the party members primarily benefiting. So political parties in Iraq have captured government institutions with intricate patronage networks, forming parallel institutions and perverting the function of public office for personal gain.

While Kadhimi and his team should be applauded for the bold actions they have taken, unraveling the kleptocratic networks will require more efforts. Iraq needs a paradigm shift and realization that such problems are not just structural but cultural. Indeed, the young protesters originated with major demands for an entitlement to employment by the government. Without a cultural shift away from patronage by the state and toward accountability to the people, corruption reforms will struggle to gain traction.

There should be strong media outreach with persuasive data to illustrate the volume of corruption and its negative impact. An environment that is conducive to change needs to be built. Groups that fight corruption also have to take advantage of the existing support by government officials to introduce the necessary policies and build a political culture of individual initiative. Such a culture would acknowledge the price of corruption, and reorient society away from resource dependence and toward economic diversification, fiscal responsibility, and political accountability.

For the first time in years, one can cautiously praise the recent measures taken by the government of Iraq to address the many ills that still plague this perennially troubled country. However, there is lots to do and a ways to go before it can come close to winning the war on corruption.

Patricia Karam is regional director for the Middle East at the International Republican Institute, a nonprofit organization that promotes democracy.