Iraq: Unfinished Business

When the U.S. combat mission in Iraq ended in August, instead of celebrations on the streets of Baghdad there was a kind of uneasy reflection about the cost of seven years of war and all the unfinished business that remains.

The American commander who knows more about that unfinished business than anyone is four-star General Ray Odierno, who spent more time in Iraq than any other senior officer. In 2003, he led the 4th Infantry Division that captured Saddam Hussein. He helped implement the "surge" as General Petraeus' number two.

And became number one himself two years ago when Iraq was so violent, he never left the base without wearing full body armor. Last month, as he was about to relinquish command, he showed us a very different Iraq.

When asked by correspondent Lesley Stahl whether he was wearing armor at a Baghdad market, the general told her, "No, I'm not."

As General Odierno looks back on his two years as commander, he says that despite a recent wave of bombings, the level of violence has come down considerably. His last act as the man in charge was to oversee the U.S. military drawdown, the largest movement of troops and materiel since World War II.

The Army's 4th Stryker Brigade, 2nd Infantry Division was the last combat unit to leave. It took them three days and nights to move across the border into Kuwait.

But many Iraqis wonder what the U.S. occupation accomplished, as we leave their country with a litany of unresolved issues, not the least being political disarray: Iraq's parliament remained locked, dark and empty, for nearly seven months while the politicians wrangled over who would be the next prime minister.

"People are beginning to wonder, you know, if this country can really sustain democracy," Stahl remarked.

"Well, I think we have to see. I mean, I still think it's too early to tell," Odierno said. "If you look in United States history, democracy was pretty ugly in the beginning. This is a very difficult form of government. But I think they really want it."

"If I were an Iraqi, I'd say 'We had this great election. We're so proud of ourselves. But what did they get for it?'" Stahl asked.

"You had an election that was free and people were able to vote for the people they thought. It was a very close election. A very close election," Odierno replied. "When have you seen a close election in the Arab world?"

But the question for people like Rahad al Hindi is: what has democracy meant for their daily lives?

The United States has spent $50 billion trying to rebuild Iraq, including $5 billion to improve the electrical grid, but as we discovered, the grid barely works.

People who can afford them buy generators, which explains the rats' nests of wires you see everywhere.

But Rahad, a factory worker, can't afford much, so she and her family live here mostly in the dark. They get only two hours of electricity a day, so no power for a fan, for a refrigerator, or a pump to bring water into their apartment.

Rahad and her brother, Bassam, get water from their neighbors with generators, one pail at a time. It's a daily trek back down the stairwell and up the street and then back again. If her neighbors aren't home, Rahad says there's no water.

"They weren't there, oh no!" Stahl remarked, after Rahad returned with an empty pail. "So now you have to wait for them to come home before you can have any water?"

It's hard to tell just how representative Rahad is: overall in Iraq, per capita income has jumped nearly 700 percent since 2003. But we couldn't find anyone who didn't complain about the quality of life.

"Someone said that since the Americans have been here, the only thing that's gotten better is they have more cell phones and more television channels. They expected the Americans to fix things," Stahl told Odierno.

"This is not about us fixing things. This is about us helping the Iraqis to fix things. Let's take a look back here: if you were back in 2006 and '07 you wouldn't see thousands and thousands of cars on the street. You wouldn't see thousands and thousands of new businesses. You kind of make fun of - there's more cell phones. Well there are more cell phones. They weren't even allowed to have cell phones before. They weren't allowed to have satellite dishes. So let's really take a look at what's changed here," the general replied.

"We interviewed an Iraqi university professor. And he says, 'What we need is a military strongman.' And I wonder if you sense that there is beginning to be a yearning, I hate to say the word, for a dictatorship?" Stahl asked.

"I don't think so," Odierno replied. "I think these people struggled significantly for 30 years now. And I don't think they're ready to go back to a dictatorship."

That university professor is Safa Bayati who supported the U.S. invasion, but now sees a dark future for his country.

"I think now America should bring a very strong military man to rule Iraq before they leave," Safa told Stahl.

"I can't believe you're saying that. Saddam Hussein was a military man," Stahl said.

"Yes," Safa replied. "Now Saddam is the very worst one. But now what we have from the politics, those politics now: they are ruling, they are much, much worser than Saddam."

You won't hear that sentiment in the northern part of the country, in Kurdistan. There they tremble at the thought of another Saddam.

Barham Salih is the prime minister of Iraqi Kurdistan. "We fear that dictatorship will re-emerge. And we have had such terrible history of genocide and ethnic cleansing," he told Stahl.

Asked if that's the biggest fear, the prime minister said, "Of course. Halabja happened in 1988: in one single day 5,000 civilians were gassed to death by Saddam Hussein. People cannot forget that and should not forget it."

With that history, the Kurds want as much independence from the central government as possible. They've been able to establish what looks like a separate country: Kurdistan has its own flag, its own army, its own parliament and president, and its own much more thriving economy. The question is, do they want to be a part of Iraq or an independent state?

"Every Kurd, including myself, deep down in my heart, I want to see an independent Kurdistan. But it is not about what you want. It's about what is possible. We have made a deliberate judgment. We have chosen to be part of a democratic, federal Iraq," Prime Minister Salih said.

"So you're committed to staying within Iraq?" Stahl asked.

"A democratic Iraq," Salih replied. "A dictatorial Iraq, I cannot give that…commitment."

But staying in Iraq doesn't mean there aren't border disputes with the rest of Iraq, as if they were a separate country. General Odierno flew with Stahl over one of the most volatile pieces of unfinished business, what they call the "disputed areas."

The Kurds and the central government each claim the disputed area, a 300-mile long corridor, as theirs. Tensions got so heated there last year, that the Kurdish army, the Pesh Merga, almost went to war with the Iraqi army.

To calm things down, Odierno organized teams of Pesh Merga, Iraqi and U.S. soldiers to man check points together and patrol the region.

"There's a lot of mistrust. So…we're trying to build trust between them and hope this would help," Odierno explained.

But there's another dispute between the two sides, that's just as contentious: oil.

"This is one of the major points that needs to be resolved very quickly, because this cannot be allowed to continue," Hussein Shahristani, the minister of oil in Baghdad, told Stahl.

Shahristani says this issue is so subversive it threatens to fragment the country. He says the Kurds have illegally hired oil companies from China, Turkey, Norway and elsewhere to explore and develop their oil independently of the central government.

"They've went and signed some contracts, which we declared as unconstitutional," he explained.

"But as I understand it, what you say is illegal is exactly what has been going on. They have hired something like 40 smallish oil companies to develop the oil fields. So what happens now?" Stahl asked.

"This cannot be allowed to continue, that the Iraqi oil is taken out from Iraqi territory, sold, the money is collected by we don't know who. Not deposited," Shahristani said.

"So, you don't know where the money goes?" Stahl asked.

"Exactly," he replied.

According to the minister, "not a single dinar" is making it down to Baghdad.

One of his more startling accusations is that one of the countries the Kurds are selling their oil to is Iran. If true, that would seem to undermine, if not outright violate U.S. sanctions that prohibit such sales.

"Are the Kurds selling oil to Iran?" Stahl asked Odierno.

"They say they are not selling oil to Iran," Odierno replied.

"And you don't. My question is: you don't really know the answer at this point," Stahl remarked.

"But the minister of oil says they might be. We're trying to get the right answer," the general said.

We decided to look for ourselves, so we drove close to the border between Iraqi Kurdistan and Iran and found oil trucks lined up as far as the eye could see.

Nobody stopped us, as one driver after another told us they were transporting fuel oil and gasoline. We followed them and watched them cross into Iran one by one.

When Stahl asked Barham Salih, the Kurdish prime minister, about this he seemed reluctant to admit the sales. "Look, what is happening, fuel oil products from refineries are being sold to Iran and are being sold - not to Iran actually: it's going through Iran to the Gulf and sometimes to Turkey," he said.

"But also to Iran," Stahl remarked.

"Iran, Iran could be buying. That's why I'm not saying no. I want to assure you we value our friendship and our alliance with the United States and we don't want to be on the wrong side of the United States," Salih said.

"But we saw the trucks going in," Stahl pointed out.

"No, I know you saw it," Salih acknowledged.

"And you admit they're going in," Stahl remarked. "You know American people don't know this. They're going to be shocked. They are."

"Listen we live here," Salih said. "To think that somehow we can build a wall between Iraq and Iran is just not on. This is a reality of this part of the world."

And that raises another issue left hanging: the growing influence of Iran in the region since the fall of Saddam Hussein.

Salih acknowledged Iran has influence in the region, telling Stahl, "Iran is powerful and has influence in Iraq as well. I'm not saying no. Absolutely."

Given Iran's new-found strategic power in the Middle East, and its influence on Shiite politicians in Iraq, Stahl asked Odierno whether Iran could end up the big beneficiary of the U.S. invasion.

"It's yet to be determined. It is yet to be determined," Odierno said.

"But how unbelievable, if you really think about it, that we came in here. We overthrew Saddam Hussein. And Iran, you don't even know if they're going to end up being more influential than we are. That's a wow," Stahl said.

"Here's my assessment: if you look at all the polls that are conducted, 80 percent of Iraqis reject Iranian influence inside of Iraq," the general said. "They're trying to influence it. They're spending hundreds of millions of dollars here. And I'm not so sure they're getting what they want yet."

Last month, in a ceremony at one of Saddam Hussein's former palaces, Odierno handed over command to a new general. And after more than four years in Iraq, he returned home to the United States.

"I want to ask you a personal question, about leaving now, when all of these things are so unsettled. And your - it was your mission, and you have to leave in the middle of it. What's going on inside?" Stahl asked.

"I certainly wish things were cleaned up a little bit more. What I can say is every day I got up, every day I looked in the mirror and I know that I did everything I could myself to lead and to do the best I can to work the issues here. And I feel very comfortable with that," Odierno said.

Asked if it was worth it, the general said, "I think we have to wait and see. I think the fact that we overthrew a terrible dictator was pretty significant. And so, I mean, I think, you know, it depends. "

Produced by Richard Bonin