So, where did it all go so wrong?

Four years after the invasion of Iraq, US ambassador to Ireland Thomas C Foley tells Denis Staunton about his role in the much…

Four years after the invasion of Iraq, US ambassador to Ireland Thomas C Foley tells Denis Stauntonabout his role in the much-criticised reconstruction of that country's economy

As the war in Iraq entered its fifth year this week, Americans have been counting the cost and reflecting on what went wrong since President George W Bush launched the invasion on March 20, 2003.

The greatest price has been paid by Iraqis themselves, at least 59,408 of whom have been killed, according to the Iraq Body Count project. US official figures say 3,222 US service personnel have died and 24,510 have been wounded. The war has cost the US about $500 billion so far and an immeasurable price in international prestige.

Most Americans believe the war was a mistake but even those who continue to support it admit that, after the swift success of the invasion, the occupation was badly mishandled. And in Washington these days, it's hard to find anyone with a kind word to say about the Coalition Provisional Authority (CPA), the transitional government that ruled Iraq for just over a year from the overthrow of Saddam Hussein until the end of June 2004.

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The US ambassador to Ireland, Thomas C Foley, who spent seven months in Iraq with the CPA, believes his former colleagues have been unfairly maligned and made scapegoats for what has gone wrong in Iraq. "I think for the most part, under the circumstances, the people who were there did a very good job with the resources they had available to them and the size of the challenge," he tells me.

A TRIM 54-YEAR-OLD with a taste for finely-tailored suits and contemporary art, Foley is more soft-spoken and reserved than many of his predecessors in the Phoenix Park. But when we met for breakfast in Washington last week, he was eager to rebut what he sees as unjust criticism of the CPA's performance and his own role in Iraq's reconstruction.

A former Bush fundraiser, Foley has been characterised by his critics as a presidential crony who was rewarded with the job of overseeing the privatisation of Iraqi state-owned industry.

"It was definitely not something you would have chosen. I lived in a four-man trailer with a modest washroom on the side of it. It was very dusty and either very hot or very cold," he says.

"It was not very comfortable at all. We worked very long hours. Normally, I'd be up at six and we'd work until midnight." As director of private sector development, Foley's job was to get Iraq's state-owned enterprises back up and running and to try to resurrect the private-sector economy that existed in Iraq during the 1950s. He believed his experience in operating and turning around troubled businesses helped to prepare him for the task of reviving enterprises that had been largely shut down by the war.

"Many of them had been looted so it wasn't just that they couldn't get raw materials, and the electrical grid was down, and all the other reasons they couldn't operate," he says.

A LOT OF the equipment was taken and, on the way out, a lot of these places were actually burned. A lot of records were gone. So it was a major challenge." Part of Foley's challenge lay in the fact that his team of only 14 people included many who were young and inexperienced, like most CPA staff. Ali Allawi, an advisor to the Iraqi prime minister, has blamed "a staff that had been thrown haphazardly together that was not up to the challenges" for much of the CPA's lack of success.

In his bestselling account of the reconstruction, Imperial Life in the Emerald City, Rajiv Chandrasekaran, a Washington Post journalist, described a cadre of young conservatives at the CPA who were recruited through think tanks such as the Heritage Foundation and, he claims, selected on the basis of ideology rather than experience.

Foley says he never knew anything about the political attitudes of his colleagues but he was not surprised that most of them were young. "You couldn't get married people to go there. I was one of the few people who was crazy enough to say, sure I'll do this," he says.

"I'm single, I was at the time. I also happen to have a business that gave me the independence to take six months to do this. A lot of people don't. Most people who were further on in their lives, were married and had kids and couldn't do it. So it was biased towards people who were young and weren't fully invested in their careers, people who were in the political arena already because they knew somebody, they knew how to connect to this. It attracted people who wanted to take risks."

Foley's most controversial decision was the selection of 24-year-old Jay Hallen to oversee the revival of the Baghdad stock exchange, an appointment widely viewed as emblematic of the amateurishness of the CPA. Foley defends his decision, describing Hallen as a bright young man who did a good job at drawing up a plan to reform the stock exchange which was implemented by experts from the New York Stock Exchange and from exchanges in Cairo and Istanbul.

"Jay was doing a good job. We were doing the best job we could with limited resources and great challenges. It was kind of a cheap shot. You know, 'he's young, he doesn't have any stock exchange experience'. They tried to use it as an example of why CPA wasn't effective but in fact, he actually did a great job and the mission was accomplished," he says.

Foley says he has not read Chandrasekaran's book but he disputes a number of its claims about him, notably that he was dismissive of international law that forbade the US occupying power from privatising Iraqi industry. Foley says it was never his job to privatise anything and he was always aware that such decisions would be taken by a sovereign Iraqi government.

"That's anywhere from a five- to a 15-year process and many of the countries in the eastern bloc handled it in very different ways and with very different results. But my job was never to sell any of the companies," he says.

"We did put together a plan, a recommendation for how to go about privatisation, best practices from some of the experience in the eastern bloc and elsewhere." He says he was determined that Iraq should avoid the disastrous experience of privatisation which followed the fall of the Soviet Union in Russia and discredited market economics for many Russians.

The decision to fire all senior members of the Ba'ath party from state positions preceded Foley's arrival in Iraq but he claims that it had little obvious impact on the quality of management in state-owned enterprises.

"Under the Ba'ath party system, you didn't necessarily have the most qualified people running the ministries to begin with. They were probably people who were the most loyal and closest friends of Saddam at that level," he says.

As the security situation worsened towards the end of his time in Iraq, Foley was forbidden to leave the Green Zone but he noticed that public opinion was starting to turn sour.

"When you come and throw somebody out, everyone is happy. But then after six or nine or 12 months, or some period of time, all of a sudden you're the one who's in charge," he says.

"So if the streets aren't clean or people don't have electricity you start to inherit the blame for the shortcomings in delivery of services. It's sort of how governments work. It's how democracies work. So I would say that after a period of time even the Iraqis I was dealing with started to become annoyed, I would say, by some of the things."

Foley points to the Kurdish region in northern Iraq as an example of how the entire country could develop if security is restored and national reconciliation is achieved. He points out, however, that the Kurdish region has enjoyed effective autonomy for a decade and predicts that real progress in Iraq will take years rather than months.

"Everybody's talking about this as if the game's over but I think the process of transition doesn't happen overnight," he says. "The system wasn't working well under Saddam. It wasn't as if everything was going great and then all of a sudden America showed up. It was falling apart and then the Americans showed up and it was still falling apart. These things take time."