The publication of the ISG report has elicited a strong reaction from across the political spectrum. As people on the left and right cherry pick facts to suit their own ideological predispositions, important aspects of the report have been for the most part overlooked. To the right, the mention of phased withdrawal and dialogue with Iran and Syria is surrendering American interests; to the left the recommendation to privatize Iraqi oil is a confirmation that the war was all about oil.
Both are wrong.
In order to understand the significance of the report, three important aspects need to be analyzed: (1) the recommendations of the report; (2) the context of its publication; (3) the composition of the commission.
First, the report rejects the neocon design for fragmenting Iraq. Instead, the ISG puts economic interests first and envisages a unified Iraq with oil revenues managed by the central government (p.39).
Second, the report aims to prevent the conflict spreading to Iraq’s neighbors. It stresses negotiations over confrontation and recommends establishing an International Support Structure which “should actively engage Iran and Syria in its diplomatic dialogue, without preconditions” (p.50). If adopted, these recommendations could bring to naught the Syria and Iran Accountability Acts engineered by the Israel Lobby.
The report also recommends direct talks with Grand Ayatullah Sistani, spiritual leader of Iraq’s shia, as well as Muqtada al Sadr, leader of the anti-occupation Mahdi Army (also Shia). (Recommendation 35: p.67)
Third, the report confirms the centrality of the Arab-Israeli conflict to the region’s politics and makes some notable recommendations which, besides affirming the need for a solution based on UN 242 and 338, mention the need for addressing the Palestinian’s right of return. (Recommendation 16-17: p.56)
This is clearly an important shift, as Clinton, under the influence of his advisors, mostly from the Israel lobby, had changed the paradigm from international mediation to bilateral negotiations rendering UN resolutions irrelevant. Given the prevailing balance of power this clearly worked to Israel’s advantage.
Fourth, the report reserves some of its most scathing criticism for the neocon dominated Defense Department which it accuses of fraying the tradition of civil-military relationship preventing the military leaders from giving direct advice to the Pentagon, President and NSC. (Recommendation 46: p.76-77)
Beyond these recommendations, however, the report stays true to the general neoliberal orientation and conservative politics of the members of the commission.
While the President is urged to “restate that the United States does not seek to control Iraq’s oil”(Recommendation 23:p.61), he is advised elsewhere to “assist Iraqi leaders to reorganize the national oil industry as a commercial enterprise” (Recommendation 63:p.85). It also urges Iraq to accept IMF diktats and reduce energy subsidies (Recommendation 62: p.85).
The arms industry also receives a nod in Recommendation 45 which encourages the Iraqi government “to accelerate its Foreign Military Sales requests” (p.75).
The violence in Iraq is blamed entirely on the Iraqis: Sunni insurgents, Shia militias and the ubiquitous Al-Qaida. There is no mention of ending the occupation. Rather, the report recommends Vietnamization (changing the color of the corpses) of the conflict where Iraqis are responsible for the repression and US personnel play an advisory role.
The “phased withdrawal” is a ruse, as the report suggests continued presence of US forces well into the foreseeable future and advises against setting deadlines. Even as Bush is urged to issue public statements rejecting the notion that the United States seeks “permanent military bases within Iraq” (p.60), it adds:
Even after the United States has moved all combat brigades out of Iraq, we would maintain a considerable military presence in the region, with our still significant force in Iraq and with our powerful air, ground, and naval deployments in Kuwait, Bahrain, and Qatar, as well as an increased presence in Afghanistan (p.72).
Short of a Saigon scenario, it is clear that the United States will be unwilling to voluntarily abandon bases it has spent billions installing.
From Iraq’s government, the report demands tougher measures against the militias (presumably the Mahdi Army, since it is the only one it singles out) and a reversal of the de-Baathification process to facilitate national reconciliation. It urges the Iraqi government to provide amnesty to insurgents and share oil revenue.
While the provenance of the report is imperialist (albeit of an economic expansionist variety) there is a realization therein of the diminishing American power in the region coupled with economic decline at home. The war against Iraq is seen as precipitating this disaster. Despite its cautious approach, the report is an indictment of the neocon grand design which is seen as jeopardizing long term American interests in the region.
The very first page starts with the admission that “the ability of the United States to influence events within Iraq is diminishing” (p.1). To underscore this, the report issues a stark warning: “If the situation in Iraq continues to deteriorate, the consequences could be severe for Iraq, the United States, the region, and the world” (p.33).
The 10 member bipartisan commission while mostly conservative in its worldview pointedly excluded neocons from its ranks. The four working groups did include some prominent neocons and Israel lobbyists – William Kristol, Clifford May, Reuel Marc Gerecht, Hillel Fradkin, George Will, Kenneth Pollack, Jeffrey A. White, Martin Indyk and Michael Eisenstadt – but their influence is largely absent except, perhaps, in the demands made of Syria (p.56). 
In an important article, Sidney Blumenthal had already noted attempts at sabotaging the ISG proceedings by the few token neocons on the working groups through leaks and demurrals.
The report is frank about tactical failures. It reveals that there is “significant underreporting of the violence in Iraq” (p.94); just in the month of October 2006 attacks averaged “180 per day, up from 70 per day in January 2006.”(p.3)
The standard for recording attacks acts as a filter to keep events out of reports and databases. A murder of an Iraqi is not necessarily counted as an attack. If we cannot determine the source of a sectarian attack, that assault does not make it into the database. A roadside bomb or a rocket or mortar attack that doesn’t hurt U.S. personnel doesn’t count. For example, on one day in July 2006 there were 93 attacks or significant acts of violence reported. Yet a careful review of the reports for that single day brought to light 1,100 acts of violence. Good policy is difficult to make when information is systematically collected in a way that minimizes its discrepancy with policy goals (p.94-95).
It admits that “sectarian cleansing” has displaced 1.6 million within Iraq, and another 1.8 million have fled the country (p.4).
The sprawling Baghdad embassy housing 1,000 personnel has only “33 Arabic speakers, just six of whom are at the level of fluency” (p.92).
It reveals that the estimates for the final cost of the war run as high as $2 trillion (p.32). It chastises the executive for “bypassing the normal review” which has eroded “budget discipline and accountability”(p.91).
As for the “liberated”, it shows that ’79 percent of Iraqis have a “mostly negative” view of the influence that the United States has in their country’ whereas 61 percent of Iraqis approve of attacks on the occupying forces (p.35).
War for Oil?
Baker’s links to Big Oil and Recommendations 62-63 (encouraging privatization of Iraqi oil) are being held up by some in the anti-War movement as evidence that this war was all about oil. Tom Hayden challenges: “Who said it was not about blood for oil?”
This would indeed clinch the argument, so long as we overlook the fact that Baker, Gates, Eagleburger et al – the foreign policy realists – were not in favour of the war and it was precisely because of their links to Big Oil.
While the neocon plan for reordering the Middle East had for its primary goal the elimination of a potential threat to Israel’s regional hegemony and a policy of “dual rollback” (as opposed to the earlier “dual containment”) to weaken Iran by exploiting a schism between the Irani and Iraqi Shia, it also envisaged flooding the world market with cheap Iraqi oil to undermine OPEC and wean the United States away from Saudi Arabia, long seen as a contender to the “strategic asset” label painstakingly cultivated for Israel.
The neocon plans for Iraq’s oil were clearly at variance with Big Oil’s interests.
Regarding the privatisation of oil, once again, it doesn’t say much. All members of the commission are of neoliberal predisposition. Their recommendation would be no different had Iraq’s primary export been “lettuce and pickles”.
This year has dealt the Israel lobby and its neocon vanguard major blows. The levee holding back criticism of Israel’s disastrous influence on US Middle-East policy has finally broken. The power of the Israel lobby is now part of mainstream debate. Polls are showing a growing awareness of its role in dragging US into war.
In this context the commissioning of the ISG – with Israel’s loyalists in the Bush administration pointedly excluded from its ranks – and the publication of its report take added significance. It belies the notion of Washington power elite as a monolith with unified interests and exposes a significant rift. While it is undeniable that any political calculation on Iraq will inevitably include oil as a factor, it is important to realize that this war was not waged for oil. The ISG report, rightly, identifies the Arab-Israeli conflict as the root of this war.
One would have had to be deluded to expect the establishment figures that constitute the ISG to offer a panacea, but in the limited space available for dissent, they have gone as far as one could reasonably expect. The viciousness of the attacks on the report (and on Baker in particular) are instructive in the fear that it has generated among architects of the Iraq war. With Baker’s history of confronting Israel doing little to allay fears of its supporters, Olmert was relying on the American “Jewish Lobby” (the preferred label for the Israel Lobby in the Israeli media) to ”rally a Democratic majority in the new Congress to counter any diversion from the status quo on the Palestinians”. 
In the past all efforts to check the power of the Israel Lobby have foundered for the the lack of popular support. It is therefore necessary that the role of the Lobby, in particular the neocons, in manufacturing this war is exposed and the people responsible held to account. Towards this end, the ISG report makes a modest contribution.
 The working groups also included pundits such as Thomas Friedman and George Packer, which presumably accounts for some of the more amusing aspects of the report (unintentional, of course).For instance, the report suggests that the United States “does its ally Israel no favors in avoiding direct involvement” in the Arab-Israeli conflict (p.54). This, of course, assumes that the $5bn in military aid, grants and loan guarantees Israel receives annually and the countless US vetoes in defence of Israeli intransigence do not constitute “direct involvement”. Paul Craig Roberts offers further analysis of Baker’s confrontation with the Israel Lobby.