OVERVIEW OF NORTHERN IRAQ FROM DEPARTING A/RC

S E C R E T SECTION 01 OF 02 KIRKUK 000119

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SUBJECT: OVERVIEW OF NORTHERN IRAQ FROM DEPARTING A/RC

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CLASSIFIED BY: Jim Bigus, PRT Team Leader, Kirkuk, DOS.
REASON: 1.4 (d)
Classified by Scott Dean, Acting Regional Coordinator, Regional
Embassy Office, Kirkuk, for reasons 1.4(b) and (d).


1. (S) SUMMARY. The Kurds have long made clear they want the
territories Saddam stripped from Kurdish control. Kirkuk
province is main prize. We believe the Kurds would let Hawijah
go in exchange for the other territories they seek. The
Commission for the Resolution of Real Property Disputes is
turning out decisions far too slowly to achieve in the north its
fundamental purpose of reducing popular anger over Arabization.
We suspect the only realistic way to prevent/delay a Kurdish
victory in the constitutionally mandated referendum on the
future of Kirkuk is not to carry out the referendum, so the
preparations for and timing of the required census and the
referendum may well spark argument. The Kurds are now watching
whether the rest of Iraq will be stable and democratic enough
for autonomy to continue. We would not be surprised if, even
after creating the new KRG Asayish, the KDP and PUK each retain
their own separate party Asayish. The KDP and PUK routinely
intimidate most media outlets; party affiliation is required for
any professional job or government favor. Dissatisfaction
occasionally erupts in violence; however, this seems nowhere
near threatening the KDP and PUK hold on power. END SUMMARY.


2. (S) Kurdish Revanchism. The Kurds have long made clear
they want the return of those territories Saddam stripped from
Kurdish control. PM Barzani's statement to this effect at the
creation of the unified KRG government May 7 was only the most
recent reiteration. Kirkuk province remains the top prize for
the KRG. The Kurds have carefully prepared for this since
liberation and are now fairly far along in realizing that plan.
-- Both the KDP and PUK have long sponsored major Kurdish
settlement programs in Kirkuk in preparation for the
Constitutionally required referendum.
-- The Kurds would like to force out Arabization Arabs, or at
least prevent them from voting in the referendum. Given clear
U.S. opposition, Kurdish leaders publicly soft-pedal talk about
forcing out Arabs. However, the Kurds probably also expect
Arabs will voluntarily leave as the houses around them fill with
Kurds. The Arab community is (predictably) split: some willing
to head south if paid, some wanting to stay.
-- While pressing ahead with Kurdification, the Kurds have in
general played their cards carefully enough to avoid a
destabilizing violent backlash by minorities. The exception is
Arab Hawijah in the south of Kirkuk province. We believe the
Kurds would let Hawijah go in exchange for the other territories
they seek.
-- The Kurds have greased the skids with the Governor of Salah
ad Din Province enough so that he (in contrast to his Arab
constituents) will not object to Tozkhurmato's return to Kirkuk
province.
-- A Talabani heads the Kirkuk IECI office; he actively
conspired to let unregistered Kurds vote.
-- The KDP and PUK almost certainly brought Kurds across
provincial lines into Kirkuk province for both the October and
December polling. We expect the Kurds will do this again in the
referendum.
-- The Kurds won constitutional change to allow Kirkuk to join
a region (the TAL's prohibition on this was specifically not
carried over into the constitution).
-- As we predicted last fall, the Kurds made "normalization"
(i.e., carrying out TAL Article 58/Constitutional Article 140) a
major condition for their support of a new government.
-- The Kurds are making Article 140 implementation a major
theme at Kirkuk Provincial Council meetings.


3. (C) The Commission for the Resolution of Real Property
Disputes is turning out decisions far too slowly to achieve in
the north its fundamental purpose of reducing popular anger over
Arabization. CRRPD success would not dissuade the Kurds from
continuing their own settlement program, but would remove the
major example in Kurdish minds of how the Baghdad government
does not keep its promises to or serve the Kurds.


4. (S) We believe that the Kurds have reason to be confident a
near-term referendum in Kirkuk province will show a majority
wants to join the KRG. (That is as opposed to a snap referendum
that some non-Kurds on the Provincial Council are unsuccessfully
trying to spark.) We suspect the only realistic way to prevent
a Kurdish victory is not to carry out the constitutionally
mandated referendum. We suspect other Iraqis know this as well,
so the preparations for and timing of the required census and
the referendum may well spark argument. The only way to stop
the Kurds from continuing to create further facts on the ground
would be for the U.S. military to stop them physically; we doubt
demarches would be enough. That said, further settlement might
well be unnecessary for the Kurds to win a majority. Since the
constitutional deadline for the referendum is the end of 2007,
we expect this issue to come to a head over the next 18 months.


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5. (S) Going for the Big One: Independence? The Kurds want
independence and are preparing for it, notably by trying to
regain territory and take control of oil and other revenues.
The KRG leadership, however, knows that autonomy gets the Kurds
most of what they want without the combat a declaration of
independence would spark. The Kurds are now test-driving
autonomy: watching whether the rest of Iraq will be stable and
democratic enough for autonomy to continue. That calculation
may determine whether they later declare independence. They
hope, of course, for a U.S. presence and support, but could
decide to go it alone if they thought an Iraqi implosion gave
them a real shot for a viable independent Kurdistan. The
distrust between Baghdad and the KRG continues: the KRG almost
certainly underpays its assessments and, by all appearances,
Baghdad ministries underserve the KRG.


6. (S) KRG Unification: Keep a Pistol in Your Pocket. By
combining their cabinets on May 7, the KDP and PUK have made a
major step forward. That said, it remains common wisdom in the
region that, without a U.S. military presence, KDP and PUK
rivalry could again rise and destroy the new joint KRG
government. The KRG has announced it will take a year to merge
its two Peshmerga (regional defense forces). Even after that
public proclamation, the outgoing Peshmerga ministers were
telling us privately they had no plans to merge. By contrast,
the KDP and PUK have agreed to create a new internal security
force (Asayish) whose members would be vetted by both parties.
We would not be surprised if, even after creating the new KRG
Asayish, the KDP and PUK each retain their own separate party
Asayish. The delicacy of revealing one's corruption to
political rivals also will complicate merging the finance
ministries. Deadlines come due next spring for KRG Interior,
Peshmerga, Finance and Justice ministry mergers.


7. (C) Democratization: An Educational Process. The Kurds can
recite in their sleep our talking points on democratization.
They also routinely announce their opposition to corruption. In
truth, though, the KDP and PUK see democracy as akin to a
Student Council: the students can debate and affect secondary
questions, but cannot change their teachers, let alone the
principal. Part of this is the two parties' concern that the
main opposition parties, like the Muslim Brotherhood-inspired
Kurdistan Islamic Union, would end even the appearance of
democracy were they to take power. However, the KDP and PUK
would not be willing to lose power, even if they saw the
opposition as benign. Therefore, the KRG routinely intimidates
most media outlets and harasses the rest through criminal
defamation suits. Party affiliation is required for any
professional job or government favor. Amid this bleak picture,
though, the PRT is having a positive effect on democratization
and transparency, partly by convincing politicians of the need
to appeal to public opinion.


8. (C) Corruption/Stability. The older generation of KDP and
PUK leaders think their years of fighting Saddam for Kurdistan
have earned them the spoils of victory. This is starting to
wear thin after 15 years of autonomy. Most people are
disillusioned with the parties and thus with elections, which
offer no immediate hope of changing the current leaders. This
dissatisfaction occasionally erupts in violence, such as the
riots in Halabjah. However, this seems nowhere near threatening
the KDP and PUK hold on power. The populace remains wary of
Baghdad and, if problems erupted with the central government,
would immediately turn to the Kurdish parties for security.
That said, the KIU is playing its cards cleverly: eschewing a
militia, let alone violence, maintaining a rigorously clean
image, providing services, running moderate-sounding,
intelligent spokesmen, and speaking out for democracy. Their
plan is to undercut the major parties over the long term. The
Islamic parties are probably making some headway, but this will
be a slow process so long as the PUK and KDP can continue to buy
and bully support.


9. (C) Despite media reports to the contrary, Kirkuk is not
Iraq's flash point. If Iraq came to civil war, it is unlikely
to start here. That said, events in the KRG and Kirkuk over the
next 12-18 months will pose challenges for Kurds and the U.S.
that could well affect Iraq's unity and viability.
BIGUS