(Source: Army Corps of Engineers Gulf Region Division/Project Cotnracting Office/U.S. Agency for International Development)

President Bush has acknowledged that the effort to rebuild Iraq’s infrastructure has not always progressed as well as the U.S. desired and says the program has shifted from large projects to smaller ones that can show faster results.

“Reconstruction has not always gone as well as we had hoped, primarily because of the security challenges on the ground,” Bush said in a Dec. 7 speech. He added that the program’s focus changed to “smaller, local projects that could deliver rapid, noticeable improvements.”

Part of that is the “commanders’ emergency response program,” in which U.S. military leaders awarded $161 million from July through September for building repairs, new light fixtures or other work requested by local Iraqi officials, says Lt. Col. Stan Heath, a Corps of Engineers spokesman.

As of December, U.S. agencies say 2,020 projects worth $2.3 billion were completed (see graph). That’s 8% below the 2,200 jobs projected to be done by then. So far, 3,008 projects have been started, with a completion value of $7.7 billion. The goal is to finish 3,580 projects worth $9.7 billion. “The truth of the matter is that there has been steady progress going on,” says Heath. But Iraq’s needs exceed the U.S. program, he adds. “There will still be reconstruction going on when we leave, whenever that time is,” he adds.

Democrats criticized Bush’s speech. But the President contended that the U.S. plan to increase Iraqis’ role “is working,” and that he sees “encouraging progress” in Najaf and Mosul, for example. But he conceded that work in much of Iraq “has proceeded in fits and starts since liberation.”

“As the President acknowledged, security has been the primary challenge in accomplishing our work,” says Bechtel National Inc. spokesman Howard Menaker. Another industry source says he’s heard security costs can be 30% of a contract’s value.

“We’ve never had to build as we’re trying to fend off people from fighting and blowing up our projects,” Heath says. “It has been a very difficult, challenging mission, but it’s ongoing.”

Superfund: Bill To Reinstate Taxes Faces Long Odds
Environmental groups and their House allies want to revive taxes on oil, chemical and other companies and put the money into Superfund. A bill that Rep. Maurice Hinchey (D-N.Y.) introduced Dec. 8 would restore those Superfund taxes, which expired in 1995.

Hinchey's bill has 24 co-sponsors but just one Republican, Connecticut's Christopher Shays. Hinchey says the bill's backers 'recognize that this is not an easy task' because the plan runs counter to GOP anti-tax views. 

Besides reinstating old taxes, including a 9.7�-per-barrel levy on crude oil used in U.S. refineries, Hinchey's bill would boost the taxes by 50% for three years. The added revenue would aid post-hurricane Gulf Coast cleanup.

Insurance: TRIA Bill Heads to the Wire

Will Congress extend the federal terrorism insurance program before it expires Dec. 31? As the end of session neared, there was little progress on resolving differences between a Senate-passed extension and the House's version.

The Senate bill, which continues the 2002 Terrorism Risk Insurance Act for two years, has White House support. The House bill, passed Dec. 7, allows a possible third year. The Bush administration opposes the House measure, in part for adding group life insurance to the program.

Senate banking committee spokesman Andrew Gray says there have been informal meetings with House aides, but 'no breakthroughs.' He says Senate banking Chairman Richard Shelby (R-Ala.) still hopes �a temporary and targeted [TRIA] extension'will pass before year's end.

Pensions: Deal with Union May Unsnarl Measure in House
Two House committee leaders say they have won United Auto Workers' support for a revised pension bill. A measure making a variety of changes in the pension system cleared the Senate Nov. 16, but a House version stalled. House Ways and Means Chairman Bill Thomas (R-Calif.) and Education and the Workforce Chairman John Boehner (R-Ohio) said Dec. 13 the auto workers agreed to provide "active support" for the measure after changes were made. That could spur the bill's passage.