IRAQ: From contractors to Combat

A year ago this Wednesday, accountant Dennis Moore had just become a father for the first time. But Moore, 57, wasn't at home in Massachusetts with his wife and baby: He was on the roof of a hotel in Kut, Iraq, blazing away with an AK-47 at insurgents threatening to kill him and dozens of others.

Their chances didn't look good. Local guards had abandoned their posts. Ukrainian coalition troops were running short of ammunition. And insurgents had a clear line of sight across the Tigris River because a coalition official had refused to erect barricades that might spoil his waterfront view.

As rockets and mortar fire slammed the compound, even civilians knew they had little choice but to grab weapons.

Says Moore: "I wasn't going to die without a fight."

Moore worked for Research Triangle Institute, a North Carolina organization that had won a $242-million contract to create 180 local and provincial governments throughout Iraq. At first, things went relatively well for RTI as it began to lay the framework for what the Bush administration hoped would be the first true democracy in the Middle East.

But on March 28, 2004, U.S. administrator Paul Bremer issued an order with disastrous consequences: Shut the newspaper of radical Shiite cleric Muqtada al-Sadr.

It enraged Sadr's supporters and opened a dangerous new front in the anti-American insurgency. Thousands of Shiites turned against the soldiers they once viewed as their liberators from Saddam Hussein. And they also turned against RTI, one of the most visible U.S. contractors in south-central Iraq, where Sadr's support was strong.

The Siege of Kut, as it became known, was overshadowed by other events that spring, including a surge in attacks that would make April 2004 the second deadliest month for coalition soldiers: 140 lives lost.

But what happened to Moore and his colleagues in 18 harrowing hours underscores some of the missteps that have hindered efforts to rebuild Iraq. Since last April, instability throughout the country has forced RTI and many other contractors to scale back their work, sowing even more disillusionment among Iraqis.

"Here comes the world's only superpower, the country that can do just about everything but that cannot do reconstruction," says Henri Barkey, chairman of Lehigh University's international relations department. "That has created a huge amount of disappointment with the United States."

Now, with the occupation in its third year, Iraq's future remains uncertain. Democratic elections were held - for which RTI can claim some measure of credit - but the insurgency rages on.

"It doesn't look good'

Research Triangle Institute was founded in 1958 by three universities - Duke, the University of North Carolina and N.C. State - in an effort to turn a sleepy Southern state into a major research center. The nonprofit RTI is best known for its AIDS-prevention work and discovery of the cancer-fighting drug Taxol.

In recent years, a growing chunk of RTI's revenues has come from international education and governance projects. None, though, was nearly as ambitious or pricey as that in Iraq.

On March 26, 2003 - six days after the invasion - RTI and the U.S. Agency for International Development agreed on a three-year contract to help teach Iraqis to govern themselves. RTI, the only bidder, would be paid about $150-million the first year, though a government report later said the figure was based less on actual need than to "justify" spending the amount of money available.

Some RTI employees felt the project was rushed, with the White House pushing democratization as a reason for invading Iraq after failing to find any weapons of mass destruction.

"I think there should have been a lot more evaluation and planning before just going in there and throwing money at this whole thing," says Peter Bussian, RTI's former media director in Iraq.

Moore, the accountant, says RTI seemed to be hiring people faster than it knew what to do with them.

"When I first got into Iraq, I didn't even know where I was going. They had to have 200 bodies in Iraq by Nov. 1 of (2003) - how's that for organization?"

RTI's staff eventually ballooned to more than 200 foreigners and 2,000 Iraqis. At first, their reception was good in southern cities like Kut, whose 300,000 Shiite residents had been shortchanged on electricity and other services by Hussein's Sunni-dominated regime.

After the government fell, RTI's first task was showing Shiites how to get the power back on, the water running, the garbage picked up.

"Since we were working with things that mattered to citizens every day, this was very positive to them," says Ron Johnson, RTI's vice president of international development.

RTI also set up local governing councils that got small grants for rebuilding schools and other projects.

Deborah Reed, an RTI staffer from Texas, impressed on an all-male council the need to include women in its decisions. None had been consulted when the council decided to pave the road from a village to a main highway.

"I said, "You go door to door and ask women what they think.' The women thought they needed a better water supply. The council only had a budget of $15,000, so when they heard that they said, "Maybe we should just grade the road, then we'd have money for both.' These women were hauling water from a river and it really was a hardship for them, but the men didn't have a clue."

Reed was pleased when another council elected a woman as its leader, proclaiming her "the most capable person in the area."

Not everything went so well. Some Iraqi contractors performed shoddy work or jacked up prices outrageously, Moore says. Vehicles and other equipment were resold for hefty profits.

"Everything you looked at was graft. It just got to be sickening after a while."

By March 2004, Iraqis were increasingly frustrated with the glacial pace of reconstruction. In Kut, they began to take out their ire on RTI; rumors spread that it was a Zionist organization, a CIA front. After Moore gave a speech at a local college, one student remarked that his next visit would be greeted with a hand grenade.

Then came Bremer's order to close Sadr's newspaper, on the grounds it was inciting violence against the coalition. How, his followers demanded to know, could the U.S. government claim to support democratic values if it wouldn't allow a free press?

"That was the straw that broke the camel's back," says David Stokes, site manager in Kut for Kellogg, Brown and Root. "Ninety percent of everything that happened was started by that order."

Stokes was in charge of meals and other services at the riverfront compound shared by coalition and RTI staff. He watched in alarm as the daily protests outside grew to a crowd of more than 2,000 on April 3.

"The hairs on the back of my neck stood up. On the 4th, we really got nervous. We could see people going through the streets carrying weapons."

As a heavily armed crowd of 1,000 gathered the next day, the staff readied for an attack by laying in stores of water and MREs. Inside the hotel, a safe area was prepared as a final retreat.

The reports were disturbing. Sadr's militia had seized the TV station and begun broadcasting anticoalition messages. Dozens of Iraqi security guards had quit, taking their weapons with them. Most of the Ukrainian soldiers responsible for patrolling Kut had retreated to their base, leaving only 35 at the compound.

On Tuesday, April 6, the Ukrainians clashed with militia along the river.

"They got into a fire-fight," Moore says, "and the next thing, bullets were flying by, rockets were flying by. They were hitting a mile away, then a half-mile away. It kept getting closer so by 2 they were falling around the perimeter and by 3 I was up on the roof shooting."

The siege continued into the night. The Ukrainians fought valiantly, but had no night-vision equipment and little heavy weaponry. Their commanders refused to send reinforcements or use a helicopter gunship to take out enemy positions.

Late that night, a security contractor asked Stokes if he had called home. The implication was clear: They might not live to see the dawn. Stokes left a message for his wife in Charlotte, N.C.: "We're being attacked and it doesn't look good. I love you and I want you to know that."

In the early hours of April 7, insurgents stepped up their attack. The hotel in which Stokes, Moore and others were hunkered down took several direct hits, shattering walls and windows.

By 4 a.m., coalition officials and the Ukrainian commander agreed on an escape plan. All 60 people in the compound would be evacuated by ground as U.S. Apache helicopters provided air cover.

Moore and the other RTI staffers were instructed to pack whatever they could jam into one small suitcase each. He also grabbed about $30,000 and threw it in his bag without stopping to count it.

Left behind: new Chevy Suburbans and thousands of dollars worth of equipment. Moore later wished he had taken more of his personal belongings and left the money: "Thirty thousand dollars was nothing compared to what RTI lost in that siege."

As the convoy of trucks and armored vehicles lined up at 6 a.m., there was one last hitch: The top coalition official in Kut, a Briton, refused to get in his car, instead urging the Ukrainians to send reinforcements.

"This was dangerous - we were out in the open," Moore says. "He was on a cell phone and he was not going to leave or allow us to leave. I thought one of the soldiers was going to shoot him."

With his own assistant threatening to leave him behind, the official finally got in an armored car. Dawn was breaking as the convoy headed through the city. Two and a half hours later, it arrived at the Ukrainian air base.

"It was," says Moore, "a tremendous relief."

The aftermath

After the evacuation, Sadr's militia captured the compound and burned the hotel. U.S. troops retook Kut on April 10.

For the next several months, the militia battled coalition and Iraqi forces in Baghdad and other cities as the Shiite insurgency threatened to destabilize the entire country. It was not until October that a final truce was reached.

By then, hundreds of Iraqis and more than a dozen coalition soldiers had died. Entire neighborhoods lay in ruins.

Although many Shiites consider Sadr too radical, "I'm not sure we've seen the last of him yet," says Bathsheba Crocker, a fellow at the Center for Strategic and International Studies. "Some of it depends on how he sees this thing moving forward."

Once Iraq's new national assembly begins writing a constitution, it must decide whether the country will have a strong central government, which Shiites prefer, or a federal system in which Kurds have considerable autonomy. Battles are also expected over control of Iraq's oil wealth and efforts to make the once-secular country an Islamic state, as Sadr advocates.

"If he doesn't get what he wants, will his people go to the streets again?" wonders Sandra Mackey, an expert on Iraq's many factions. "He is really talking about turning the whole system upside down."

The Shiite uprising also put a big crack in the administration's "coalition of the willing." Ukraine lost its first soldier in the Kut attack, and his death was followed by 17 more. The government, faced with heavy home-front opposition to the war, says it will withdraw all 1,600 troops by Oct. 15.

In a followup report on the siege, Stokes, the KBR site manager, said certain decisions by the Ukrainian commanders "nearly cost us our lives." He also criticized the British coordinator for refusing to erect barricades that would have made the compound less vulnerable to attack.

For RTI, the siege marked the start of a dramatic retrenchment in Iraq.

Moore and others were evacuated to Baghdad or Kuwait, then flown home. Since last April, RTI's staff has shrunk to 32 foreigners and 620 Iraqis.

The institute also scaled back geographically. While it once had offices in Kut and 16 other provinces, it now operates only out of Baghdad, Basra, Irbil and Hillah. According to the Winston-Salem Journal, security costs in some areas had risen to 43 percent of RTI's budget as of late last year, "forcing RTI managers to shut down many previously approved reconstruction" projects, the paper said.

Exactly how RTI spent the $242-million it has received so far remains a mystery. Neither it nor the Agency for International Development will disclose details.

"I think taxpayers have a right to know, particularly the amount of overhead paid to the main office in North Carolina and how much money was lost during the uprising," Moore says.

In December, the agency notified RTI it would not extend its contract for a third year. A spokesperson says the agency had no problems with RTI's performance but wants a "different direction" now that elections have been held.

RTI bid on the new contract - there's no dollar amount this time - and faces at least one competitor. Meanwhile, the institute got a $5-million extension to train government ministers and newly elected officials in the nuts and bolts of democratic government.

Although RTI was not involved in the Jan. 30 elections, its work with local councils and discussion groups gave thousands of Iraqis their first taste of participatory democracy, says Johnson, the vice president.

"People are extremely proud the elections happened so successfully. There's still a long way to go, but I feel much better than I did before."

As for Moore, he looks back on his six months with RTI with a mix of nostalgia and regret.

"We had a great team, one of the best. We worked hard, we were all getting results. It was a shame we had to give up."

• 174 War & Disaster Profiteers Campaign