The Pop Star and the President

Will West Africa's biggest music star and Senegal's octogenarian president-for-life learn to sing along -- or is the country on the edge of discord?

There are multiple levels to politics in Senegal, one of the oldest -- and until recently, most successful -- African democracies. There are the power plays and massive government projects reported on by the international media, but also a parallel system of religious affiliations, cultural networks, and tribal ties, little seen by outsiders. To understand the headlines, you need to delve into the latter.

The big news this week is that Abdoulaye Wade, Senegal's geriatric president, is breathing a sigh of relief. The constitution says he can only run for two consecutive terms, but on Friday the constitutional court of this West African country ruled that this did not apply to him. It also decided that Youssou N'Dour, the global pop superstar and the country's greatest export, who had thrown his hat into the ring, was not eligible to run. Violent protests have flared, in Dakar and elsewhere, in response to the decision and at least three people have been reported dead. Once regarded as one of the most progressive and democratic of African countries, Senegal's stability is under threat with opposition leaders calling for "popular resistance."

Wade has dismissed protests as "temper tantrums." It is an attitude which verges on the pharaonic, which in the wake of the fall of Egyptian President Hosni Mubarak and among calls by Senegalese opposition groups to turn a square in Dakar into the Senegalese Tahrir, might seem risky. But then, perhaps Wade's tastes and outlook had already long since turned pharaonic.

Imagine, for example, a woman so big that if her breasts were turned into huts, a couple of families could live inside them. When Senegalese go to the polls on Feb. 26, and think of how Wade has spent their taxes, maybe they will be thinking of her too. The woman, of course, is not just statuesque but, along with her muscle-bound man and child, part of the colossal Monument de la Renaissance Africaine statue, which at 160 feet tall tops a steep hill that looks out over the Atlantic Ocean and can be seen for miles across the capital.

Whether Wade wins or loses the presidential election, they will say this of him: He was the man who gave Dakar this monument. Not health care, never mind schools, forget this that or the other: This monument, designed by a Senegalese, built by North Koreans, will be his legacy. (It cost at least $27 million. The way it was paid for led many to query its apparently convoluted financing, as a WikiLeaked U.S. diplomatic cable reveals.)

"Stalinist," scoff some, "Un-African" say others. Some say that the woman, unveiled (so to speak) in 2010 to mark the 50th anniversary of independence from France, in a country which is 94 percent Muslim, cannot be Senegalese because no decent woman would ever comport herself in such an outrageous state of semi-undress. But then the monument, like Wade himself, has divided this country, and not necessarily along obvious lines. One religious man, an editor at a radio station to which people call in to ask for religious sung poetry to be dedicated to friends and family, reminded me that, once upon a time, people carped that the Eiffel Tower was an eyesore and a waste of money too.

But for a sense of where this country's real, hidden power lies, shoot down the road in front of the statue, drive along the scrubby, Atlantic corniche, then turn into the heart of the city. Downtown, in the sandy, streets of a middle-class district, all is dark. Much to the constant irritation of Senegalese, power cuts are frequent. But, drifting through the night air, above the hum of generators, comes the chanting of a group of men singing in a circle out on the pavement. Women sit on the ground listening to them.

These men, mostly in their twenties, thirties, or forties, come together twice a week for two hours to sing the devotional poems of Amadou Bamba, a towering figure in Senegalese history who died in 1927. These gatherings are common across the country.

And, here is the thing: Bamba's legacy is extraordinary, but in the outside world hardly anyone has ever heard him. But, if you don't understand his legacy and the Mouride movement he founded, you won't understand the complex power structures of this vibrant country.

International attention began to turn to the Senegalese election last November when N'Dour, who apart from being a singer is also an entrepreneur, philanthropist, and media mogul, inaugurated a political movement called Fekke ma ci Boole which means "I am a witness, so I will react" in Wolof, Senegal's dominant language.

Back in 2000, N'Dour, who is wildly popular, had sung for and supported Wade, but had since fallen out with him. This falling out reportedly began when the N'Dour-owned newspaper l'Observateur reported that Karim Wade, the president's powerful son, had been arrested in Paris with large amounts of cash. Karim sued the paper for libel and won. N'Dour may also have been peeved by his inability to get a license for a television station he attempted to launch.

Wade, who is now at least 85 (though many believe he is older), has been president since 2000 when his Parti démocratique sénégalais ousted the ruling Socialists who had governed for 40 years. Many, N'Dour included, argued that a 2001 constitutional amendment prevented Wade from running for a third term. But Wade said that the two-term limit did not apply to him because he was already in office when the change was made. On Friday, the court agreed -- and for good measure also banned N'Dour from running for not having gained enough signatures to make the ballot.

In the past few years, Wade has begun to think about succession, or more specifically, how to pass on the baton to his son, Karim, who for many years has held important government and advisory posts. As a leaked U.S. cable from 2009 titled "The Heir Apparent?" noted, "Ministers are scared of him, business people are cowed by him and major policy decisions are vetted by him." It also said that in the wake of the Organization of Islamic Cooperation (OIC) conference summit in Dakar in 2008, whose preparations he had overseen, it was widely believed that Karim had "embezzled a significant amount of funds" and that in the diplomatic community he was now known as "Mr. Fifteen Percent." Karim wasn't done acquiring nicknames. When he was later named minister of energy, he was dubbed by the press, "minister of heaven and earth."

Last year, his father attempted to change the constitution to create the post of vice-president. Many believed that Wade senior intended to make Karim his running mate in this February's elections, and then leave office after being elected -- thus having his son take over.

This plan was abandoned after news of the plan provoked riots in June. Following the disturbances, the Wades were hit with further embarrassment when Robert Bourgi, a well-connected French lawyer revealed that Karim had appealed to him to intercede with the "highest authorities" in France for military help to put down what he said were "quasi-insurrectional" riots. But the riots spoke to more than just dissatisfaction over the constitutional end-around. Senegal's gross domestic product has tripled in just over a decade, and millions of dollars have been poured into Dakar, funding the construction of broad highways, a new airport, an expanded sea port -- and, of course, the monument. However, the experience of most Senegalese is that the rich get richer, while life is as hard as ever. On the U.N. Development Program's Human Development Index, Senegal ranks 155 out of 187 countries. Life expectancy is 56 years and gross domestic product per capita is $1,023. That's barely more than $2 a day.

As everywhere in Africa, youth unemployment is a huge problem -- but, for decades, the safety valve has been emigration. Now, thanks to the global recession, jobs are harder to come by and less money is being sent home by émigrés. It is not surprising that the most prominent protest movement should call itself Y'en a marre: "We're fed up!"

Thus this election cycle has been more contested than most. Some 20 people originally said that they intended to run in the presidential elections; 14 were accepted by the court. Until N'Dour joined the fray, though, Wade was hopeful that he would pass the 50 percent threshold and avoid a second round of voting. In 2007, he was elected in the first round by 56 percent. Among the more serious contenders are two of Wade's former prime ministers, Macky Sall and Idrissa Seck. In the past, both were considered possible (chosen) successors to Wade but both have since fallen out with him. In 2007, Sall summoned Karim Wade to Parliament to testify about the allegations of improper financing during the preparations for the OIC summit. This was widely interpreted as a play to eliminate Karim from the succession race and enhance Sall's own chances. Wade sacked him.

Seck fell from grace when he was arrested in 2005 on charges of corruption and threatening state security. He was released and the charges were dropped. Seck claims on his website that Wade moved against him because of his opposition to the promotion of Karim as heir. In 2007, Seck ran for president against Wade, garnering a respectable 14.9 percent. Still, Britain's oldest and most respected source of African news, Africa Confidential notes now, "neither man can escape controversy over other corruption scandals, any more than they can their past association with Wade."

N'Dour, of course, has been the joker in the pack. As soon as he entered the lion's den of politics he was subjected to all manner of vilification. N'Dour, 52, is a self-made man: He left school early and holds no degree; his father was a car mechanic; his mother came from a family of griots, or praise singers. He began by singing at circumcision ceremonies but soon began performing with Dakar pop bands. In 1979, he formed his first band and was discovered by British pop star Peter Gabriel. From then on he moved into the pop global stratosphere, famously making "7 Seconds" with Neneh Cherry in 1994. Today, he owns a newspaper, a television station, and recording studios and claims to employ over 1,000 people -- yet his enemies have denigrated him for his lack of education and noted that the constitution says the president must be able to speak, read, and write in French. N'Dour -- who admits his lack of formal education -- retorts simply that many of the people running the country have degrees but don't seem to be able to manage anything.

But N'Dour also holds some insights into the Mouride power structures in Senegal that run deep beneath the turbulent political landscape. I visited N'Dour last year to record a program for the BBC on Mouridisme and he, a Mouride like Wade, discussed his Grammy award winning album Egypt, which is a collection in praise for Amadou Bamba, the ascetic and mystic Islamic scholar born in 1853. Bamba opposed French colonialism but preached against violent resistance and argued that his followers were best armed through devotion to God. He founded his Mouride movement in 1883; as it grew, the French became nervous that it had the potential to become an insurrectionary force. He was exiled twice, once to Gabon and once to Mauritania. However, then as now, the core of his message was non-violence and hard work. Eventually, the French let him return -- and in 1918, the colonial power awarded him the Légion d'honneur, the nation's highest honor.

As a marabout, or spiritual leader, Bamba began to gather followers. Today, there are 3-5 million of them out of a Senegalese population of 12-13 million. Many are just born into Mouride families, others may join by declaring their allegiance to a marabout. Typically marabouts are then supported by contributions from their talibés or followers. Both women and men can be members.

The centre of Mouride life is the city of Touba, founded in Bamba in 1887, a four-hour dusty drive, past empty Baobab-punctured land from Dakar. It is Senegal's second city with a population of perhaps 800,000. At its symbolic gates into town are two injunctions. Non to smoking in the holy city and Oui to Ndiguël. An Ndiguël is a holy edict, the equivalent perhaps of a papal bull in Europe a thousand years ago.

Mourides are one of the four major Islamic brotherhoods of Senegal, to which almost all Senegalese are connected. In contrast to the predominant forms of Islam in the Arab world to the north, these are branches of Sufi Islam, an altogether different tradition. Like the other brotherhoods of Senegal, at its core are the marabouts of which, of course, there is a hierarchy. Touba, being home to Bamba's descendants, has become the Vatican of the Mouride world and is home to the Grand Marabout or Caliph General, the head of the movement. After Bamba's death in 1927, his sons succeeded him as caliphs. In 2007, that authority passed to his geriatric grandsons. The current Caliph General is Cheikh Sidy al Moukhtar Mbacke who is in late eighties.

Marabouts have a dual role. Not only are they spiritual guides but networkers, connecting their followers, not just to Allah but to all manner of business and political contacts. In Senegal, it is not just whom you know, but whom your marabout knows.

Mourides have becomes so important in the life of Senegal that you often hear complaints that people are becoming Mourides only for the connections, not for the spiritual guidance. According to Oumar Fall, the commercial director of Diprom, a big Mouride-owned metals and energy company, some 50 out of the top 100 Senegalese firms are owned by Mourides.

Today, the power of Touba is undiminished. It has a special status in the country, meaning that it is run by its own rules. There are no state schools there for example, only religious ones. Smoking and drinking are forbidden, as are hotels in the normal sense of the word, which are associated with alcohol and prostitution. And every year, for the major festival of the Grand Magal (which commemorates the moment God is said to have told Bamba that his years of tribulation were over), hundreds of thousands of pilgrims pack the city.

This year, the pilgrimage was held on Jan. 12. All the while, Senegal's top politicians have been zooming and back and forth to Touba, paying court to the Caliph General and the most influential marabouts. They always want favors, but now they want the Caliph to tip his turban in their direction and indicate that they have been anointed. In the recent past, Touba's support has gone to Wade. But this year the Caliph's spokesman has said that there would be no Ndiguël on whom to vote for. "Touba does not have a candidate in the 2012 presidentials," he said. Dismissing suggestions that Wade had made a large contribution to this year's festival organization, he added, "No one can buy Touba with money."

But with violent demonstrations now breaking out across Senegal, the Caliph has finally broken his silence with a rather cryptic message: "Those who reign by terror will perish by terror," said the Caliph's spokesman. Is this a shot across Wade's bow? For what it's worth, both the United States and France, the former colonial power have spoken up as well. "We are concerned that the decision by President Wade to seek a third term undermines the spirit of democracy ... that it could jeopardize the decades-long record that Senegal has built up on the continent for democracy, democratic development and political stability," said William Burns, the U.S. deputy secretary of state.

No one's yet threatening to topple Wade's grand statue on Dakar's seaside. But it is hardly surprising that anyone who knows West Africa should feel a cold chill of horror after the events of the last few days. Liberia, Sierra Leone, and Ivory Coast, are all near neighbors. All different countries, of course -- but all countries that, in the recent past, have simply disintegrated into blood. For now at least, many observers think that Senegal's democratic roots are strong enough to keep it from such a horrific scenario, but whether Wade and N'Dour chart their way through the current discord is a score yet unwritten.  

Inset Photos: Tim Judah



Crude Awakening

In Iraq's turbulent politics, whoever controls the oil production wields the power. And that might soon be ExxonMobil.

On Dec. 17, two days after the U.S. military cased its colors and formally ended its mission in Iraq, the brain trust of the Iraqi oil sector gathered for a symposium at Baghdad's Alwiyah Club, a fortified concrete complex of meeting rooms and outdoor gardens. They were officially meeting to discuss "Challenges Facing the Development of the Extractive Industry." The issues they grappled with held the prospect to transform the global energy marketplace and determine the course of Iraqi democracy.

A few top government officials sat on a dais while members of the audience -- about 150 parliamentarians, technocrats, and academics -- took turns at a podium, giving short speeches and asking questions of the panelists. Speakers often had to yell to be heard over the objections of audience members. A bit of shouting was to be expected: This was the first time in years that Iraqis were gathering without a foreign military occupation to outline their economic future. And in a country where 95 percent of government revenue comes from oil, any debate about oil is also a struggle for power. They addressed the most fundamental questions: How much oil should Iraq produce? What should happen to the revenue? Who should control the country's oil strategy? You wouldn't have known it by the volume of the rhetoric, but a lot of the talk was moot.

Much has already been decided. In 2009, the government started awarding contracts for the country's largest fields, and the biggest names in oil have signed up. Companies like ExxonMobil and BP have invested billions of dollars, bringing the latest in technology and engineering expertise. Production has rebounded from just over 1 million barrels per day after the invasion to nearly 3 million today. Baghdad's 11 international oil contracts promise to deliver a total of more than 13 million barrels per day within seven years -- a figure that would make Iraq the largest oil producer, ever.

There are good reasons to doubt these projections. For one thing, the current political crisis has underscored Iraq's failure to build the kinds of institutions -- a credible judiciary, non-politicized security forces -- that support a stable, functioning, democratic state. Even if Iraq weren't plagued by daily bombings and political dysfunction, it would be hard-pressed to achieve what would be the most rapid oil expansion in world history.

Yet if the investment bonanza can even partially succeed, it promises to reshape not only Iraq but also the regional balance of power. Falah al-Amri, director of the State Oil Marketing Organization, showed the audience at the Alwiyah Club a PowerPoint presentation with figures that he had quoted to his Gulf counterparts at a recent OPEC meeting. By 2014 or 2015, he said, the country would reach the magic number of 4.5 million barrels per day of oil production, at which point OPEC would start trying to enforce quota restrictions.

Amri vowed that Iraq would negotiate hard for a larger national quota. He also provided a clue to the government's contracting strategy, which appears to recognize that oil is a source of not only revenue but also geopolitical power.

"Our plan is not to flood international markets. This is not our goal. If we have a spare 2 or 3 million barrels per day, then so be it," Amri said. He later clarified to me that he thinks Iraq will have this "swing capacity" -- that is, the ability to drastically increase production on short notice -- by 2017.

Saudi Arabia is currently the world's only so-called "swing producer," with an already-developed capacity that far exceeds its current production. This status gives the kingdom enormous power. If any other producer falters -- if, say, rebels in the Niger Delta blow up a pipeline or Iranian oil is shut in by an embargo -- the world economy depends on the Saudis to open the taps and keep prices from rising too high. This Saudi leverage also keeps its OPEC associates in check: Other cartel members can't stray too far from their production quotas, lest the Saudis flood the market with a punitive deluge of crude, driving down everyone's prices and profits.

Amri's presentation contained the seeds for the disruption of this power dynamic. If Iraq develops 2 million or 3 million barrels per day of swing capacity, which is roughly what Saudi Arabia claims to have, OPEC will suddenly have a second enforcer. That could pave the way for a regional rivalry between Saudi Arabia and the Shiite-led Iraqi government. Relations between the two are already in the doldrums, as Saudi leaders have characterized Prime Minister Nouri al-Maliki as an Iranian puppet and continue to refuse to send an ambassador to Baghdad. Their worries are not unfounded. Maliki is no puppet, but he has taken dramatic steps to consolidate power by pushing aside all his major Sunni-backed rivals; as a result he is increasingly dependent on a Shiite political base with deep ties to Iran.

But though the geopolitical implications of Iraq's efforts to become an energy giant are dizzying, they will only become a reality if the country can meet Amri's ambitious projections. And there's no guarantee that the country can overcome the daunting challenges facing its oil industry.

Iraq has already come a long way. A Western oilman recently recalled for me the sorry state of Iraq's oil sector shortly after the 2003 invasion. He had just arrived in the southern port city of Basra to get a key field back up and running, and he found that after decades of sanctions and underinvestment, some critical equipment was literally held together with duct tape. Thankfully, Iraqi engineers were experts at improvising improbable solutions, and after weeks of work, everyone was confident that the field could restart production.

"It's time to light the flare," the oilman announced.

In most modern facilities, when you need to burn off certain byproducts of crude oil production, you press a button on a control panel and ignite a flare atop a metal chimney. But in Basra, where no such mechanism existed, it was a slightly riskier proposition -- and the responsibility for the task sparked a shouting match among the more junior Iraqi workers.

After a long argument, the Iraqis drew straws. The loser wrapped a wet T-shirt around his head, held a flaming torch in the air, and, crouching low, crept toward the chimney, which was hissing with invisible, flammable gases. When he got close enough, the air burst into a giant fireball and the man ran screaming back to his cohort, who doused him with water and laughed at his singed body hair. Soon after, the Western oilman introduced a slightly more modern ignition device: a flare gun, which could be fired from a safer distance.

Iraq's oil sector has matured since then, but that kind of crazy improvisation remains a defining characteristic. Bureaucratic hurdles also continue to hobble the oil industry's development. For several months in 2011, for example, many top Western oil company officials couldn't enter the country because their visas took months to process. Amazingly, the government was preventing them from doing the work it had contracted them to perform. The problem turned out to be a simple backlog: In a bureaucracy that functions through the authority of only a few strong leaders, the visa applications had to travel all the way to the prime minister's office for approval. Iraq's current atmosphere of political crisis offers little hope that Maliki will relax his tendency to micromanage and govern through just a handful of loyal subordinates.

Similar delays have affected almost every aspect of companies' operations: They have had problems getting paid on time; Oil Ministry officials have been slow to sign off on plans and subcontracts; and customs officials have held up the delivery of key equipment while waiting for authorization. One Western executive told me recently about a particularly troublesome holdup -- a shipment had been waiting for weeks at the border, he said, and now they were running low on essential supplies, including ammunition for their flare guns.

It's not just the facilities that are badly in need of modernization: The legal infrastructure for Iraq's oil industry is also held together by the political equivalent of duct tape.

Shatha al-Musawi, a former member of parliament and one of the speakers at the Alwiyah Club, knows firsthand the murky legal foundations of Iraq's oil sector. She had been the plaintiff in a 2009 lawsuit that challenged the legality of BP's contract for the Rumaila oil field in Basra -- the world's second largest, which now produces about half of Iraq's crude. Musawi's complaint centered on the fact that the Oil Ministry had not submitted the Rumaila contract to parliament for approval, as Iraqi law appears to require. Instead, Maliki's government unilaterally approved the Rumaila deal -- and all subsequent contracts -- without the legislative branch. Musawi's case was a quixotic fight against this power grab.

"There is not a strong legal basis for these contracts," Musawi said. "There is not any intention to build a new state, a democratic state."

The Iraqi Constitution calls for a modern oil law, but political dysfunction has prevented one from being passed. In a country where petroleum is power, any law that dictates the structure of the oil industry is also bound to define the state itself. And in a political arena dominated by fear and identity politics, nobody wants to share power. In recent debates, the sides have split along largely ethnic and sectarian lines: Maliki's Shiite-majority allies have backed centralized control of oil, while parties representing the minority Kurds and Sunnis say local governments should have more authority. No bill has yet survived parliament.

The Rumaila deal, Musawi argued, represented a textbook executive end-around. By commissioning billions of dollars' worth of investment, the Maliki administration was creating irreversible facts on the ground. Parliament could not pass a law that would invalidate major contracts because that would scare away future business -- and Iraq needs foreign investment for its reconstruction. Instead, future legislators would have to retrofit any new law to account for the existing contracts.

This is how governance works in Iraq: Strong leaders take action in the name of necessity when democratic bodies fail to function. As a result, the people in power have few incentives to compromise and many reasons to undermine public institutions. The Rumaila case, for example, was not allowed to proceed. Iraq's highest court, which has made several suspiciously favorable rulings for the prime minister, said Musawi would have to pay a $250,000 court fee just to bring the case to trial. Unable to raise the money, she was forced to drop the suit.

Political power dynamics have determined the course of Iraq's oil development far more than legislative policymaking. That volatility, however, hasn't dissuaded oil multinationals -- there's simply too much oil under the country's soil. So, many companies, from BP to ExxonMobil to Shell to Lukoil, have been willing to invest billions of dollars without the stability of a modern oil law. Companies have mitigated their risks by negotiating contracts that rely on international arbitration to settle major disputes, rather than Iraqi courts. But the overarching reason companies can operate with some confidence is that -- in the laissez-faire political economy of Iraqi oil -- their power rivals that of the divided Iraqi state.

Iraq's oil powers are split between two governments. After the U.S. invasion, the semiautonomous Kurdistan region in the north grew fearful that the new government in Baghdad would, like Saddam Hussein, use economic power to oppress them. Kurdistan's minister of natural resources, Ashti Hawrami, led an aggressive strategy to develop an independent oil sector, signing contracts without the central government's consent. He divided Kurdish territory into a grid of several dozen exploration blocks and, over the past decade, has signed a whopping 48 oil and gas contracts.

To leaders in Baghdad, this looks like an affront to Iraqi nationalism. The most forceful objections have come from Hussain al-Shahristani, one of Maliki's most powerful allies, who became oil minister in 2006 and now serves as deputy prime minister for energy. He argued that without a centralized system to manage oil, competing interests would tear the country apart along geographic, ethnic, and sectarian lines. He insisted that Baghdad should have sole authority over contracting and condemned the Kurdish deals as illegal.

Due to Iraq's vague constitution and incomplete regulatory structure, it's not clear which side has the legal upper hand. It's certainly an urgent question. One of the George W. Bush administration's biggest reconstruction benchmarks for Iraq was to pass an oil law, and U.S. Ambassador Zalmay Khalilzad spent months brokering negotiations. In 2007, a draft oil law passed the cabinet, and Khalilzad published a triumphant op-ed in the Washington Post proclaiming "the prospects for passage are excellent." But negotiations soon died in parliament. There were many reasons for the failure, but the single biggest was the rivalry between the Arab majority in Baghdad and the Kurdish government. The final nail in the coffin came on Sept. 8, 2007, when Kurdistan signed a contract with the U.S. firm Hunt Oil, whose chairman, Ray Hunt, sat on Bush's Intelligence Advisory Board. The definitive American influence, it turned out, was wielded not by the U.S. Embassy but by a private company.

Shahristani had to respond to this show of the Kurdish government's growing clout. He also had to start generating the kind of revenue that could fuel Iraq's reconstruction, with or without an oil law. One sure way to do both was to bring in even bigger companies to develop the vastly larger fields in southern Iraq. In October 2009, Shahristani signed a deal -- without parliamentary approval -- with oil giant BP to rehabilitate the Rumaila oil field. Then came ExxonMobil, with a contract for the 8.7 billion-barrel West Qurna Phase 1 field. Those two fields hold more proven oil reserves than the entire United States has, and if the terms of just those massive contracts are met, Iraq will reach more than half of Saudi Arabia's current production before the end of this decade.

Shahristani's contracting spree was driven at least in part by political motives, and his ambitious projections could easily run aground on some harsh practical realities. For one thing, if Iraq's fields were to increase production any further right now, the oil would have nowhere to go. There aren't enough pipelines, storage tanks, refineries, and export terminals. Iraq is building many of these facilities, but probably not fast enough for the production rates that the state is now contractually obliged to support.

Nor is it clear whether world markets could stand so much new supply. If Iraq were actually able to increase production to the unprecedented height of 13 million barrels per day within seven years, the price of oil would likely drop just as steeply. Not only would this destroy Iraq's profit margins, but it would also provoke dangerous levels of anger from nearby producers such as Saudi Arabia and Iran, both of which possess superior military power.

Worst of all, perhaps, Iraq has lost full control of its production strategy. The deals don't just require the companies to boost production aggressively -- they require Iraq to pay for the contracted volumes. If the companies hold up their end of the bargain, but the government has to make cuts for any number of reasons -- infrastructure constraints, market pressures, or OPEC politics -- Iraq could be forced to pay companies for oil they're not producing. As the gatekeeper of the world's third-largest oil reserves, Shahristani is hardly powerless to renegotiate these deals. Still, the contracts do surrender a remarkable degree of economic sovereignty for a government still struggling to formalize its own powers.

One dramatic expression of Iraq's declining power over the oil giants came on Oct. 18, 2011, when ExxonMobil signed a massive exploration deal with the Kurdistan region. The move directly violated Shahristani's policy of unitary authority. In past cases, Shahristani punished oil companies for signing with Kurdistan by blacklisting them from his contracting auctions. But now, with ExxonMobil pumping more than one-tenth of Iraq's crude from the West Qurna Phase 1 field, the government found itself with much less leverage. (ExxonMobil has not acknowledged any contract with Kurdistan and has declined to comment, though multiple officials in the Kurdish and central governments have confirmed the deal.)

Baghdad is now left with two bad options. It could banish ExxonMobil, risk a loss of production, and probably provoke a lawsuit that would stoke the anxiety of other investors. The more likely scenario is that the federal government will seek some sort of compromise that will eventually validate some of the contracting powers Kurdistan has already claimed.

Nevertheless, Kurdistan isn't likely to win the complete autonomy that it desires anytime soon. Baghdad continues to hold two trump cards. First, it controls the pipeline network to the Mediterranean port in Ceyhan, Turkey, through which any large-scale exports must travel. Second, it controls the sale of oil and the collection of export revenues -- and therefore the flow of money from oil sales back to both Kurdistan's budget and its contractors. Hawrami, the natural resources minister, has suggested that he wants to increase Kurdish oil exports from their current level of about 175,000 barrels per day to 1 million barrels per day within five years. For that to become a reality, he needs a deal with Maliki and Shahristani.

Indeed, a truce between Kurdistan and Baghdad could be in the works. When Maliki visited Washington in December, he met privately with Exxon CEO Rex Tillerson. One of Maliki's advisors, speaking anonymously, confirmed to me that Maliki asked Tillerson to "freeze" the Kurdish contracts. The advisor said the government is proposing a quid pro quo: If all parties agree to a new oil law, then Baghdad will endorse a mechanism to recognize ExxonMobil's Kurdish contracts. Maliki is essentially trying to borrow ExxonMobil's new leverage with the Kurds, asking the company to pause its new deal in order to force the Kurds into a grand oil bargain. This could be a pragmatic solution that uses ExxonMobil's influence with both governments to reconcile the two sides. But, assuming it would even work, this plan would transform the oil giant into one of three main parties, alongside the federal and Kurdish governments, that shape the country's oil sector.

ExxonMobil is hardly to blame; Iraq is simply too divided to realize its potential strength.

If the state were functioning well, then politicians and technocrats would fight their battles within policymaking bodies and through private debates. On the international stage, they would speak with a single voice to the oil majors and neighboring countries. Such a unified front would help Iraq enormously. Its negotiating power would rise and likely its production too. This kind of successful policymaking would probably look something like the passionate arguments at the Alwiyah Club -- and indeed, many of the speakers there pointed out that, with strong institutions and a dose of compromise, everyone would benefit.

But this isn't how it works today. In the arena of Iraqi identity politics, leaders don't trust each other -- often for good reasons -- and power looks like a zero-sum proposition. Such perceptions can be self-fulfilling. For the oil sector, the dysfunction of the government has already set projects back; ExxonMobil's willingness to risk its relationship with Baghdad is one sign of well-informed pessimism. As we look ahead, the atmosphere of crisis and improvisation seems unlikely to break, and the outlook for Iraqi production seems uncertain at best. But in a fledgling country where everyone is still jockeying for power, this much is still clear: Oil is king.