“We’re dealing with a country,” Deputy Defense Secretary of State Paul Wolfowitz facilely told Congress recently, “that can really finance its own reconstruction relatively soon.” The man is either an outright optimist or is gifted with self-deception.

While Iraq indeed has assets, roughly $18 billion a year in oil exports, the amount is puny, considering the scale of the task ahead. To start with, Iraq’s economy is in shambles. It is in debt to the tune of $116 billion, including $25 billion to Saudi Arabia, $17 billion to UAE countries, $8 billion each to France and Russia, and $3 billion to commercial creditors. This does not include $200 billion in “claims for damages,” or reparations, due to Iran, Kuwait and multinational corporations.

Iraq, in other words, is bankrupt and cannot rely exclusively on its oil revenue to rebuild, for the more oil it pumps to increase its earnings, the more the price will fall, leaving it no better than before. There will not be enough money to go around to finance all reconstruction needs, including the rebuilding of hospitals, power plants, telephone exchanges and other vital infrastructure. The bill for that alone is estimated at something in the neighborhood of $80 billion.

And the transition of the Iraqi economy from the Baathist regime’s central planning to open market will be daunting. Saddam Hussein, an avid reader of Stalin biographies, had created an economic system modeled on that of the Soviet Union, marked by central planning, fixed prices and wages, nationalized public services and generous, off-the-books payments to regime cronies.

After decades of being ravaged by a corrupt government elite that relied on fear and artifice to function and a brazen kleptocracy that robbed the country blind, Iraq was left with an economy no one could fathom (the government released its last budget in 1978) and a population whose exact size, demographic distribution and life expectancy no one knew. (Reportedly, for the last 12 years, Iraqis did not, for example, report deaths to the authorities because they did not want to turn in the food ration cards of the deceased.)

Before Hussein’s disastrous nine-year war with Iran in 1980, his invasion of Kuwait in 1990, and the 12 years of UN sanctions that followed, Iraq was on top of the list of developing nations in the world, flush with oil revenue, an income per capita that had doubled in the 1970s, and heavy government spending on education and health care.

Today the country is a basket case and its climb out of chaos will not by any means be easy. For Iraq to get out of the hole, in other words, its immense debt of $300 billion will have to be written off or deferred. That’s for starters. Then an international aid program — involving the World Bank and the International Monetary Fund — as ambitious as the Marshall Plan could begin to address the problems of reconstruction.

Talk about the US going to Iraq to “steal its oil” is naive. Talk, however, about American companies angling to get a piece of the action in the rebuilding venture is not. These companies are already standing in line, including accounting and finance firms that have begun soliciting the US Agency for International Development for jobs to revamp Iraq’s central bank and rework its financial system. In the long term, however, Iraqis will end up, of course, footing the entire bill.

Will the US show good faith in its remonstrative commitment to rebuilding a “free and democratic Iraq” with a political system genuinely responsive to the aspirations of the Iraqi people?

Before your raise your hopes, I say raise your guard. For consider the man that the administration has chosen as Iraq’s interim military governor: Retired Lt. Gen. Jay Garner. That’s good old Jay, the gung-ho defense contractor who developed the Arrow missile-defense system for Israel, and who visited Tel Aviv a year-and-a-half ago as guest of the hard-line, Likud-leaning Jewish Institute for National Security Affairs where he signed that organization’s letter praising Ariel Sharon’s treatment of Palestinians.

Having the know-how to rebuild a country is one thing; winning its people’s hearts and minds is another.