Media attention on the insurgency in Iraq has tended to focus on dramatic incidents or horrific acts of violence. At the same time, policymakers in the United States and other coalition countries have often viewed the insurgency in largely political terms. Yet, particularly worrisome is the convergence of large segments of the Iraqi insurgency with elements of organized crime. Unfortunately, improved anti-terrorism effectiveness has resulted in increased criminal activity by several significant groups within the insurgency.
So while the political and military aspects of the insurgency have received most of the world's attention, the insurgency's subtle shift toward increased reliance on criminal activity has implications that are just as important for the Iraqi economy. Increased criminal activity is effectively stifling attempts to expand the formal sector. This, in turn, presents a major challenge to the newly elected government: how to stop and reverse the insurgent-led deterioration of the economy and the vicious cycle it has created. It is safe to say that a successful attack on criminal activity in Iraq is as important in determining the country's future as the outcome of the current anti-insurgency campaign. One might even venture to say they are largely one and the same.
Organized Crime, Iraqi-Style
Insidious criminal activity is not new to Iraq. In fact, as recent revelations coming out of the United Nations Oil for Food scandal show, criminal activity has long been pervasive in all areas of Iraqi society, from the highest levels of official power to the lowly smuggler trying to eke out an existence during the period of sanctions in the 1990s. Under Saddam, Iraq became what Iraqi sociologist Faleh Abdel Jabar calls the family-party state, dominated by close family members and tribal associates.