ABDULMAHDI DISCUSSES POLITICAL AND ECONOMIC

C O N F I D E N T I A L BAGHDAD 003916

SIPDIS

SIPDIS

E.O. 12958: DECL: 12/01/2017
TAGS: PGOV IR IZ
SUBJECT: ABDULMAHDI DISCUSSES POLITICAL AND ECONOMIC
SITUATION WITH DEPUTY SECRETARY


Classified By: Charge d'Affaires Patricia A. Butenis for reasons 1.4 (b
) and (d).


1. (C) Summary: On December 1 Deputy Secretary of State John
Negroponte, Coordinator for Iraq David Satterfield, and
Charge d'Affaires Patricia Butenis met with Iraqi Deputy
President Adil Abdulmahdi, CoR Shi'a independent Qassam
Daoud, and former oil minister Thamir Ghadban. Abdulmahdi
emphasized political progress but acknowledged the disparity
between local and national reconciliation efforts. He said
de-Ba'ath would "maybe" be passed before the end of the year,
and all Iraqis agreed on the need for continued American
engagement to ensure the passage of key legislation. End
Summary.


2. (C) Abdulmahdi said political progress should not be
measured only by benchmarks, pointing to the willingness of
groups to enter the political process, the continuing JAM
cease-fire, and the change in political behavior of Sadrists
as examples of political gains. Daoud struck a more cautious
note, acknowledging the success of tribal engagement but
warning that Iraqi government institutions need to be
involved in the long-term. He said that after the withdrawal
of Iraqiyya and Tawafuq there was no longer any national
unity government and warned that JAM was unpredictable.
Abdulmahdi conceded political gains were fragile but insisted
that JAM's complicity in the Shabiniyah violence drove a
wedge between JAM and the Iraqi people.


3. (C) The Deputy remarked that during his visit he noticed
that people and communities appeared to be getting along
better than their respective national leaders and that
reconciliation was occurring on local levels. Abdulmahdi
said the Deputy was "absolutely right," adding that either
politicians need to change or people needed to change their
politicians. Ghadban added that in the Baghdad neighborhood
of Ghazaliya Sunnis and Shi'a were talking to each other and
exchanging items from their food baskets. Abdulmahdi
concluded that "the political is not reflecting the social
reality."


4. (C) On legislation, Abdulmahdi said that the draft
Justice and Accountability would "maybe" be passed before the
end of the year. Daoud clarified that the slow pace of
legislative progress was "the nature of our clock,"
explaining that 80 to 90 MPs would soon leave for haj and not
return until the last week of December or first week of
January. Given that most of these MPs normally attend
sessions, Daoud predicted that achieving quorum during this
time would be impossible. He added that parliament would
extend the legislative term through January to ensure it
passes the 2008 budget and de-Ba'ath law.


5. (C) Turning to the provincial powers law, Abdulmahdi said
it would be passed "later" and that due to Da'wa opposition
it had not yet reached parliament. Ghadban corrected him,
noting that a draft currently in the CoR received two
readings but there was uncertainty over whether a new draft
would need to begin the process again. Abdulmahdi could not
confirm that President Hashimi approved a revised Pension Law
but worried about the financial impact of paying 200,000
government pensions. Abdelmahdi expressed surprise that
according to the Investment Law the approval of the PM is
necessary for provincial projects exceeding 250 million USD.
The participants agreed on the need to reform government food
basket programs to stimulate agricultural production.
Ghadban added that there were ongoing discussions on removing
some items, including detergent, from the basket all
together.


6. (C) Daoud cited decreasing U.S. engagement on the oil law
as a reason for the law's delay in the CoR. He said American
pressure was needed to moderate the factions and increase
Kurdish support for the draft. Ghadban added that those that
supported the oil law now oppose it and that the climate "was
not good" for passage of the law. Satterfield emphasized the
importance of the legislation and explained that U/S Reuben
Jeffrey was coming to Iraq with respect to forming a
technical review committee with a mission to reconcile the
February and July drafts.


7. (C) Comment: Abdulmahdi's confusion over the status of
Provincial Powers and the text of the Investment Law
illustrates the degree to which even Iraq's national leaders
are confused about the legislative process. End Comment.


8. (U) The Deputy Secretary's party has cleared this cable.
BUTENIS