If cooperation between Baghdad and Erbil broke down, disaster would ensue. The landlocked KRG depends on good relations with its neighbors in order to export oil. For the Kurdish economy to thrive, the oil must flow. “You can’t go independent when you’re bankrupt,” Talabany noted. A breakdown would also provide an opening for ISIS. “How do we prevent [ISIS] rebuilding itself under a new name?” asked Dr. Hanan al Fatlawi, an Iraqi member of parliament on the foreign affairs select committee. “We have to rebuild the trust between the components of Iraqi society.” Post-liberation reconstruction is expensive, as is providing security as communities attempt to reintegrate. “Security is paramount and without security you cannot go on,” Governor Karim said. All of this is dependent upon Iraqi petrodollars.
Catastrophe is avoidable, however. Dr. Ashdi Hawrami, the KRG’s Minister for natural resources, emphasized his commitment to cooperation with Baghdad. “There is no question that we will be having a dialogue and cooperation,” he said. Iraqi Prime Minister Haider al-Abadi will need to take a firm hand with the Kurds ahead of upcoming Iraqi elections, but he has a good relationship with the KRG. And all parties agree that a break in relations would spell mutual disaster.
It is into this delicate situation that Trump has pitched himself, without apparent regard to the consequences. That his threat to strip Iraq of its oil survived his transition into the White House demands careful consideration of what the proposal could actually entail. The U.S. military would not, as Trump has suggested, occupy Iraq to oversee the illegal extraction of crude from its oil fields, which are dispersed across the country. But in light of Trump’s other stated priorities that does not mean he will not move to try and extract money from Baghdad. He could seek to deliver on his suggestion that Washington should “reimburse” itself for some of the costs of its military operations in Iraq by negotiating Iraqi payments in crude for America’s substantial provision of arms, training and direct military assistance.
Or he could just push the Iraqi government to award favorable contracts to American companies like ExxonMobil, whose former CEO Rex Tillerson has just been confirmed as secretary of state. Tillerson’s previous escapades, of course, present a cautionary tale. Under Tillerson, ExxonMobil purchased oil rights to land blocks controlled by the KRG in 2011—a deal that directly challenged the authority of the Iraqi government and was partially responsible for an armed stand-off between the Iraqi army and the Kurdish peshmerga.
Tillerson’s record of aggressively asserting corporate interests into decidedly thorny diplomatic climates also reflects the lack of common purpose among Trump’s team. James Mattis, Trump’s secretary of defense, has a record of seeking to confront Iran’s growing influence in Baghdad. Destabilizing Iraq’s oil sector would weaken Baghdad’s hold on the country, thereby strengthening Iran’s position. Trump has established a reputation for letting his staff compete, rather than collaborate, and in Iraq this risks seeing the Pentagon and Foggy Bottom pursuing contradictory positions, just as tensions in Iraq reach their height.
What is indisputable is that for Trump to wade into this minefield demanding a cut would be destabilizing. It would, as Edmund Burke once described British efforts to recoup the costs of a foreign war from the people of the United States, be “to tax where no revenue is to be found,” and the result would be comparably volatile, destroying the KRG’s relations with its neighbors, stripping resources from Baghdad’s peace dividend and helping ISIS to prolong its insurgency.