Economics Economic system Despite al-Bakr's and the Iraqi-led Ba'ath Party's radical rhetoric, their economic policies were neither radical nor very
socialist. Al-Bakr's policy can be divided into two parts: the first being a largely
populist economic policy, and the second, an economic policy based on
cronyism,
patronage and
nepotism. By the late-1970s, Saddam had
de facto control over Iraq's economic development by being chairman of the most important economic committees. A shift happened under Saddam's command; a
socialist economy, according to Con Coughlin, with government ownership of natural resources and the
means of production was established. Saddam also started a diversification programme to ensure that Iraq would not be dependent on its oil revenues in the future. Even before the Ba'ath takeover, the Iraqi government set economic growth targets through
economic planning. The
Revolutionary Command Council (RCC), the highest legislative and executive organ of party and state, implemented and decided the goals of the plan. It was the political elite, and not the economic elite, which decided the content of an economic plan; before the Ba'ath took power, it was the other way around. The RCC convened every year to set up a budget for each year to come.
Agricultural policy From the very beginning, al-Bakr's handling of Iraqi agriculture was handled with a populist touch. For instance, in 1969 the government cancelled all compensation for sequestered lands. This decree relieved the beneficiaries of the reform by removing the financial burden. Investments in agriculture increased, and by May 1970 the government had introduced a new land reform. This land reform tried to revitalise Iraqi agriculture by resolving some of the issues of the previous land reforms, such as by paying more attention to the relationship to the type of land and irrigation system, and limits on how much land could be owned. At around this time, the government also established several
collective farms to placate the party's left-wing faction; the establishment of collective farms soon halted. Other measures were also introduced which benefited the landholding peasants, but these reforms were never able to counter the decline in agricultural production. Because of this, and the high population growth at the time, Iraq became a net importer of food grains; imports of food grain increased twelvefold from the early 1960s. The introduction of subsidies and the removal of financial burdens from the peasantry were populist, but were also part of al-Bakr's plan of creating a patrimonial system with himself at the top. This system gave the economic levers of powers to the political elite, which it used to confiscate the properties of its political opponents. The continued sequestration of land increased the strength of the patrimonial system; members of the political elite could bestow lands to people to increase the support for the government. The government could do this because the government was Iraq's biggest landowner. The co-operatives which had been established provided a means of social control through their regulation. Corruption also proved to be a problem, and the acquisition of land of people close to the political leadership was repeated on a scale not seen since the
time of the monarchy. By the mid-to-late 1970s, the Arab Socialist Ba'ath Party's land reform was beginning to have an effect. By 1976, 71 percent of state-owned land was given 222,000 new farmers. These farmers were also given up-to-date agricultural equipment. Co-operatives increased from a low 473 in 1968 to 1,852 in 1976.
Oil industry The government, which was still embroiled in a conflict with the
Iraqi Petroleum Company (IPC), a private enterprise, on Law 80 of 1961. Iraq was later able to negotiate a treaty with the Soviet Union, whereby the later built an oil pipeline to an oil refinery and oil export facility at
al-Faw, in the
Persian Gulf, to improve Iraq's oil producing capabilities. This agreement would signal the end of the IPC's dominance over Iraq's oil resources; it also reinforced al-Bakr's belief that the company needed to be nationalised. Negotiations between the Iraqi government and the IPC began in December 1971 and ended in March 1972 when the government was given shares in the IPC's equity. However, relations soon soured; the IPC cut its own production at the
Kirkuk Field by half. The government saw this as proof of the company's arrogance, and the government also began to see the danger of a private company controlling such a vital source of the government's revenues. The IPC was nationalised in June 1972. The nationalisation of the IPC proved to be the last important element of foreign control over Iraq's control, and Iraq as a whole. Austerity measures were introduced in anticipation of the loss of revenue. Even so, the nationalisation proved highly popular with the people. In addition, al-Bakr and Saddam had taken steps to make the anticipated loss less severe on the people and the economy; Saddam visited Moscow and negotiated a treaty whereby the Soviet Union would buy some of Iraq's oil, and second, the government did not nationalise the IPC subsidiaries and gave French members "special treatment". These French members bought nearly a quarter of Iraq's oil production. This policy proved highly successful, and there was a massive increase in the price of oil in the aftermath of the
1973 Arab–Israeli War. The oil revenues strengthened the political elite's patrimonial system; the means of patronage exceeded "anything available" to previous rulers.
Standard of living On taking power, the Arab Socialist Ba'ath Party promised wealth distribution and a more equal society; the government's effort to implement this was hampered by the government's lack of revenue. The government was able to fulfill this promise with the increase in oil revenues in the 1970s. The
standard of living increased due to the nationalisation of the IPC. The country's electricity grid was expanded, and for the first time in Iraq's history, it reached the countryside.
Domestic policy The Kurds Under Bakr conflicts intensified between the government and the Kurds. In early 1974 heavy fighting erupted in northern Iraq between government forces and
Kurdish nationalists, who rejected as inadequate a new Kurdish autonomy law based on a 1970 agreement. The Kurds, led by
Mustafa Barzani, received arms and support from
Iran. Around this same time he founded the
National Progressive Front in an effort to broaden the support base for his government.
Repression In July 1978 a decree was passed which made all non-Ba'thist
political activity illegal and membership of any other political party punishable by
death for all those who were members or former members of the Armed Forces.
Foreign policy His government initially supported closer ties with
Nasser, and under his rule Iraq almost joined the
United Arab Republic. The
flag of Iraq was modified in preparation for this goal. However,
the relationship with Nasser eventually deteriorated. Bakr's government also strengthened Iraq's ties with the
Soviet Union. On 9 April 1972, Iraq and the Soviet Union signed a treaty of friendship. The two countries agreed to cooperate in political, economic, and military affairs. The Soviet Union also agreed to supply Iraq with arms. According to historian
Charles R. H. Tripp, the Ba'athist coup of 1968 upset "the US-sponsored security system established as part of the
Cold War in the Middle East. It appeared that any enemy of the Baghdad government was a potential ally of the United States." From 1973 to 1975, the
Central Intelligence Agency colluded with
Shah Mohammad Reza Pahlavi of
Iran to finance and arm Kurdish rebels in the
Second Iraqi–Kurdish War in an attempt to weaken al-Bakr. When Iran and Iraq signed the
Algiers Agreement in 1975, the support ceased. == Death ==