In the midst of a defense of Donald Rumsfeld, Deacon over at Power Line sneers at "the modern liberal view that the state can accomplish anything." In other words, let's blame the inherent chaos in Iraq for Iraq's problems, not Rumsfeld's inability to fix everything, shall we? It's not like he's god or anything. Right?

Well, not exactly.

The first step is to admit we have a straw man problem here. Clearly the state can't accomplish everything, and no one ever suggests it can. But the state can still accomplish a good deal more than what we've seen in Iraq. Unemployment has hovered at or around 50 percent for over a year. 50 percent! (Those numbers, by the way, are skewed by rosy employment in the Kurdish provinces.) Yet for the bulk of the occupation, first the Pentagon and later the CPA mostly concentrated on selling off Iraqi industries and privatizing former Baath holdings—a fire-sale of dubious legality, by the way. It was willful anti-statism at its finest. (In fact, Lt. Gen. Jay Garner was sacked for trying to bring back Baathist job-creation programs.)

In the long run, of course, many economists would endorse this approach—even though Argentina seems to have undercut the neoliberal wisdom on economic growth lately—but in the short term, privatization caused a good deal of unemployment and inflation in Iraq. The chaos that ensued scared away all of the foreign investors that were supposed to be attracted by privatization in the first place. Oops! Now none of this is explicitly Rumsfeld's fault, but he also didn't give these problems much thought before the invasion. The Untidy Theory of Freedom was embraced over the more statist concerns of the Future of Iraq project.

The larger point is that, fine, Rumsfeld can be skeptical about the abilities of the state (or a military trustee) to solve all the problems of the world. But it's not likely that this view will make him very good at undertaking massive nation-building projects. The occupation, after all, was an inherently liberal venture—the whole premise of disarming and transforming Iraq was that you can't just let "stuff happen". So I don't see how the anti-statist outlook of Bush, Cheney, Rumsfeld, Bremer, could ever translate into quality nation-building.

As a side note, I seem to recall that one of the big success stories in Iraq involved Lt. Gen. David Petraeus turning Mosul into one big socialist paradise—bags of money being distributed freely on the street, guaranteed wages for workers, etc. Then it all fell apart when Petraeus's 1st Infantry Division rotated out and National Guard units came in to lightly police the town. Freedom thus reigned. And freedom became a wee bit untidy.

By the by, I don't think Rumsfeld should get a pink slip. Why bother? The confirmation hearings would take months, and a new Defense Secretary probably wouldn't improve much on Rumsfeld. (Especially if Bush chooses loyalty or 9/11 affiliation as his major selection criteria, rather than competence or vision.) The military has more or less adjusted to fighting the insurgency, and while they could probably use better intelligence and more manpower, neither will be forthcoming anytime soon, regardless of who takes Rumsfeld's spot. We've long passed the nation-building component of the occupation, and are settling into the watch-and-hope portion.