I appreciate the opportunity to talk to you about combating insurgencies. I'd like to start off by explain­ing what I believe is the Bush Administration's over­arching strategy in the war for freedom, to briefly discuss both what I believe went wrong with Iraqi reconstruction and what I believe is going right with Iraqi reconstruction.

Iraq and the War on Terrorism

First, an oft-debated subject is Iraq's role in the War on Terrorism. If you look at a map, however, it is very difficult to dispute that Iraq is not a central front in the War on Terrorism. Iran rests directly between Iraq and Afghanistan, and consequently it has severe problems with the concept of democracy going forward in both countries. If a democracy is successful in Afghanistan, this brings Iran no comfort.

In short, what President George W. Bush is trying to do is to replicate the Cold War containment strate­gy of Harry Truman combined with the rollback doc­trine of Ronald Reagan in the Middle East.

Our Founding Fathers established the United States as a revolutionary experiment in human free­dom. Even to this day, Americans who are well grounded in their history understand that America is a revolutionary nation still. What Americans have difficulty understanding is that the Iranian ruling elite believe they are a revolutionary nation as well. As a result, what we are seeing in Iraq, and increas­ingly in Afghanistan, are these two revolutions in direct competition.

If the American Revolution is successful in bringing liberty to Iraq and Afghanistan, the totali­tarianism and extremism of the Iranian revolution will be blunted from its expansion. People in the area will have hope, the Iranian revolution will be contained, and it is my belief that the people of Iran--a proud people who throughout civilization have played a momentous role in human advance­ment--will no longer be condemned to live under a tyrannical regime, causing it to implode as the Soviet Union did.

If we reverse these prospects and yield to the calls for "changing course in Iraq"--which is noth­ing but a euphemism for "retreating in the face of an enemy"--the Iranian revolution will spread first to Iraq, and then with al-Qaeda's assistance into Afghanistan. How we leave Iraq is how we will leave Afghanistan. If these events were to unfold and Iran successfully acquired a nuclear weapon, Iran would then try to destabilize Pakistan and depose the gov­ernment of Pakistani President Pervez Musharraf. I would point out that they already have nuclear weapons in Pakistan. And the prospect of a Taliban without the United States being able to assist a sov­ereign Pakistani government in protecting itself would be a nightmare the likes of which I hope we are all spared.

In terms of Iraq particularly, it has been a source of increasing frustration for both myself and others who have always believed that in any successful reconstruction effort--either post-conflict or, as we tried to do in Iraq, during a counter-insurgency that was not at the time recognized sufficiently--you have to build from the grassroots up. It is particular­ly appropriate that I am here at The Heritage Foun­dation because I believe that Russell Kirk was right: Every society has traditional roots of order. As a conservative, this is a deeply held principle for me.

Democracy from the Top Down?

For the United States government, under the direction of a "conservative president," to try to cre­ate a model democracy in Iraq from the top down through a highly centralized bureaucratic state was absolutely inexcusable. What we are seeing now is the success of General David Petraeus's plan-- already, I believe, ahead of schedule, if you consider that the lifetime of a general counter-insurgency typically is seven to 12 years just to quell it. This is because he has adopted a counter-insurgency plan that relies upon gathering the support of the tradi­tional roots of order--the local tribal and religious leaders--just as the United States did with our town councils as we built up to states, as we built up to the Articles of Confederation, and as we built up to a Constitution.

As early as 2003, I was urging the Administration to create an oil fund for the Iraqi people. I had hoped it would be enshrined in their constitution based upon the model we have in the United States, the Alaska Oil Fund. A portion of revenues are put into a centralized fund and distributed per capita to individuals throughout the state. It could have been replicated in Iraq. There could have been conditions placed upon it so that if you participated in the insurgency and did not throw down your arms, you would lose your entitlement. There could also be conditions that if you turned in insurgents, you would receive their share as long as you lived. There is a multiplicity of beneficial outcomes that could have occurred, and yet today we still see the prob­lems associated with the distribution of oil funds in that troubled nation.

A Transactional Benefit

I believe General Petraeus's plan will work pre­cisely because he has inverted the top-down approach and made it bottom-up. We've seen this in Al-Anbar and we will continue to see this through­out Iraq. What we've seen is America trying to pro­tect its own liberty by extending it to others. In the process, what we have to remember is that this is a transformational change for the Iraqi people. I hotly dispute the concept that some people are unfit for freedom; I believe all human beings equally yearn to breathe free. I know that in my own district back home, the Iraqi-Americans that live there have cer­tainly taken to democracy quite well. The reality is that if you do not provide ordinary human beings with a transactional benefit from a transformational change, they will consider, as the Iraqis have always done, that their government is like the weather-- rarely good, sometimes exceedingly bad, and some­times mortally dangerous, yet it remains beyond your control. General Petraeus is giving the average Iraqi an immediate transactional benefit that links him or her to the transformational change that is occurring in the nation.

As Americans, it is easy to be an armchair quar­terback and say they should be more idealistic, but as an Irish Catholic whose father escaped the Democratic Party, I take my hat off to them. If you think about the greatest engine of social assimila­tion in the United States, it was the big city machines of the Democrats and a handful of Republican mayors that brought these new immi­grants into the American system, providing them shelter, helping them find work, and bringing them into the political system. This was not done by the federal government at that time. In fact, I would argue that some of the recent attempts we've seen at a comprehensive "immigration plan" and the failure of assimilation prove that if you provide an individual a transactional benefit in their hands, they will understand why liberty is so essential and eventually will outgrow their depen­dence, as my father's generation did.

With that, I'll take your questions.

Questions and Answers

Question: You mentioned that democracy in Iraq is something that Iran is not looking for, but I guess the logical comeback to that is, of course, the Shia majority and the extensive influence that Iran has throughout government and municipal govern­ments throughout the south of Iraq.

Rep. McCotter: One of the long-term prob­lems in Iraq is how to prevent the Iranians from subverting the Iraqi government. If General Petrae­us's plan works perfectly and the Iraqi government becomes stabilized, our troops withdraw after being victorious. How do you prevent the Iranians--giv­en their proximity, given their relationships, kin­ships between the Shia in Iraq and Iran--from subverting a constitutional Iraqi government?

I believe you have to hearken back to the Iran- Iraq War, where I believe close to one million peo­ple were killed. The Iraqi Shia fought in that war. If you look at the celebration--I know it is a vignette, but it remains valid--of their nationhood after their soccer victory, the vast majority of Iraqis who remain in Iraq identify themselves with Iraq. Why they did not seal that border remains beyond me.

When the Iranian revolution occurred, Ayatollah Khomeini's people immediately viewed the secular Baath party as an enemy. They had to get rid of Sad­dam Hussein's regime. They wanted to export their revolution, very much like Trotsky believed you had to export Communism. Shia who were friendly toward the Iranian revolution then tried to destabi­lize the Iraqi regime by trying to perform assassina­tions on Baath party members, including Tariq Aziz. Those Iraqi Shia were then chased out into Iran, where they were housed for 20 years.

The first step would have been to ensure that they did not come back in as the United States troops removed the Saddam Hussein regime. Now that they are there, we start to see the bitter fruits of that, such as with the Mahdi army, Muqtada al-Sadr, and others. But it is my belief that the Shia who have stayed in Iraq, who stayed through the Iran-Iraq War, do not want any part of that Iranian regime and are going to be the ones--if we are successful through the Petraeus plan--who are empowered to bring forth both the transformational and transac­tional benefits to the Shia people. If you look at what Muqtada al-Sadr is doing in parts of Baghdad, he's performing much like a big city ward boss would. If you look at what Hezbollah and others did in the wake of the Israeli war, this is what they're doing. Why the United States, which actually per­fected this strategy back at the turn of the last cen­tury until the Progressive Movement, does not understand this is beyond me.

I believe General Petraeus is taking a similar approach and showing that liberty will work. As it provides benefits to you and your family's material well-being, and eventually to your political and spiritual well-being, the lure of the short-term ben­efit from people aligned with Iran will diminish. I truly believe that. The concept of Iraqi sovereignty has been derided, but I think it is far stronger than most people would believe.

Again, the Iraqi Shia were loyal to Iraq under Saddam Hussein during the Iran-Iraq War. They consider themselves Iraqis. There is also some sem­blance of Iraqi secularism. Although small, it can grow over time.

Question: How do you gauge your caucus's temperature on Iraq? Do you think that it's going to stay together in September?

Rep. McCotter: Early on I advocated, and I continue to advocate, that this is not a political mat­ter for our party. If we descend to the level at which national security and elemental questions of right and wrong become an issue on which we can be coerced or cajoled, then we have not done our job as representatives of the sovereign American people. We would then descend to the level of those who view everything as a political matter in relation to national security.

As the son of a former Truman Democrat (although he never admitted it) and an Eisenhower mother, I guess that makes me a Truman Republi­can. When your nation is engaged in warfare over­seas, you retain your right to dissent. But you also have the responsibility to put forward constructive solutions to further the cause of victory. If you do not like what the President is doing, then you should tell the President how we can best achieve our goal, be victorious, and allow our troops to come home to their loved ones. I think that when you treat this as a political matter you stray from that fundamental principle and you get into all sorts of trouble. We have not whipped our caucus on this, and we will not. It is a matter of conscience and we believe that in the end this is the best approach. I know how I will be voting, my constituents know how I will be voting, and I think that's right and proper. But if they do not ask, I will not force it upon them.

Question: I recently came back from Iraq, and I stayed with a secular Shiite there. The prob­lem, as he tells me, is that the Sunnis--as you say, the traditional order--have dominated the Shia for hundreds of years, first with the Ottomans and then the Hashemites. How do we, by staying within that traditional-order strategy that you seem to advocate, overcome that momentum that the Sunnis have developed?

Rep. McCotter: Well, I'm talking about the local traditional roots of order, not a perversion of a governmental system by a minority that captures the majority. That would be more akin with Sadd­am Hussein's Iraq or apartheid South Africa, where the minority whites suppressed the majority black population.

Ultimately, while people have talked about the division of Iraq into three separate nation-states, if you continue to build from the town council level up and have a process that empowers people at the local level through their tribal leaders, through their mosques, through others, what you will see is a strong provincial system based upon the town councils with a more loosely organized central government.

Remember, what the Sunnis did with that gov­ernment? They used the powers of a centralized government to kill and oppress Shia, who were the majority. If you were a Sunni, whether you partici­pated in that or not, when the United States comes in and says, "We are now going to have a centrally organized national government and we're going to hand it to the people you killed and oppressed for generations," your first reaction would be, "This might not be in my best interest."

That put up an enormous red flag when com­bined with the horrible mistake of abject de-Baathifi­cation as opposed to a rational de-Baathification. You turn back into a very nervous, anxious population of Sunnis. If you look at the growth of the insurgency since then, it seems to make sense. I would argue that the first assuaging of the Sunni Iraqi spheres would be to have the redistribution of those oil funds decided and to have the per capita proceeds directed to them. This would alleviate the fear that they are now going to have the Shia take all the oil money and leave them with nothing, which would then lead to the next step in their minds--their ulti­mate and perhaps genocidal eradication by a Shia government. And again, you have to go back to the question, "How are they materially better off?"

On my second trip to Iraq I got into a bit of a dust-up with a British general. He mentioned that the local population was irate because foreign con­tractors had been brought in to work on a major project in their town. I looked at the general and said, "Why does this surprise you?"

I'm from the city; I was born in the city of Detroit, I live near the city of Detroit. I can imagine what my membership in the United Autoworkers would think if we brought in people from around the world to do their jobs right in front of them. Those types of things upset a population. General Petraeus's strategy of fostering the grassroots will mollify the Sunnis and success will occur. People who have a vested stake in the future, who believe there is hope, who see material progress for their wives, children, husbands, and parents occurring on a daily basis will understand that this system works. I believe that will work.

This is where we get into the difficulty, because there is a political dimension to this. Distribution of oil funds would be a major step in resolving this issue. However, the concentration of oil fund reve­nues is a temptation for any strongman to seize pow­er and then fund whatever flights of fancy that he may want to inflict upon the rest of that region or the world. This does not preclude, I point out to my free market friends, foreign companies being able to par­ticipate in the production of oil from Iraq. It just ensures that the proceeds that come from whatever country does it, be it Iraqi or a foreign national, be allowed to be shared by the Iraqi people.

That is something Saddam did not do. At the expense of the Shia, Saddam took all the money he could for electricity and any type of programs in the Sunni areas. This is a critical resolution, so I would say we have to continue General Petraeus's grass­roots-up-to-the-central-government strategy. We must ensure that there is a quick resolution of the proper and equitable redistribution of those oil rev­enues to ensure that stability begins to take hold and is cemented.

Question: What role do you see for economic development in our current counter-insurgency operations in Iraq?

Rep. McCotter: The role is to allow the Iraqi people the means to build the economy. In Ameri­ca, the largest engine of economic progress is small business. It's not Franklin Roosevelt's Tennessee Valley Authority (TVA).

If you think about what was done with the Coalition Provisional Authority, they tried to come in and build little TVAs all over Iraq with foreign contractors, and the local economies were in sham­bles. Instead, I think you have to go in and try to create conditions. This is where the surge is mis­characterized. The surge in troops was required to help bring this down to a more manageable level of counter-insurgency so that security could be estab­lished, and the reconstruction from the ground up could occur. That's what this is all about.

The people who say there's no solely military solution to this are right, and General Petraeus understands that. Finally, the Bush Administration understands that. We're on the right track. But in terms of economics, one of the fundamental mis­takes we made was when we allowed the command­ers' emergency funds to run out. The military was in contact with Iraqi people on a daily basis, from necessity and of circumstance.

As a result, Baghdad began to centralize every­thing. When the funds ran out, the military com­manders on the ground were no longer allowed to make decisions that would bring harmony to their areas or to help mute some of the differences that were beginning to emerge. Instead, everything was going to Baghdad and nothing was getting done, including land distribution to people who were try­ing to come back and stake their claims to ancient lands that Saddam had chased them from.

I've also argued with some of my friends that say the State Department was proper in conducting this reconstruction from the start. I would argue they were wrong, and my simple response is that it wasn't Ambassador Eisenhower and Ambassador Mac­Arthur who rebuilt Germany and Japan after World War II. This is not to say that the United States mili­tary should develop social workers rather than sol­diers, but the direction of a reconstruction team should be directed by the military. I base that upon the past success of what we've done with other con­quered nations that have had to be reconstructed.

Question: As you're talking about counter-insurgency in Iraq, and we are seeing the beginnings of success, to what extent is the Partiya Karkaren Kurdistan (Kurdistan Worker's Party, or PKK) on the radar screen? That's proving to be another unpleas­ant outgrowth of this, and they are unfortunately operating in the one part of Iraq that is, in general, very friendly to us. At the same time, it's pushing away one of our closest regional allies.

Rep. McCotter: I would hope that our clos­est regional ally, Turkey, does not use this as pretext to go in there and try to grab the oil revenues that come from the Kurdish north. Again, the funda­mental problem right now is not the PKK; we agree on that. And the Turkish government, if they believe the Kurdish north is the greatest problem, is blind to the reality of the situation. I will also say that I don't mind some of their consternation in Turkey, given how little help they provided us in making sure that our troops came through Turkey on the way in, during the initial hammer-and-anvil strate­gy. Perhaps if they had allowed us to do that, I'd have more compassion for their discomfiture. I do not at the present time.

The Honorable Thaddeus McCotter, a Republican, represents the 11th district of Michigan in the United States House of Representatives, where he also serves as chairman of the Republican Policy Committee.