The first steps are obvious, because they are inescapable. As things stand, no one can write a single cheque on Iraq’s behalf until the question of its towering debts is sorted out. Not a single barrel of oil can be sold until it is clear who has first claim to the money; no reputable oil company would touch it without clear title.

Iraq’s debts to foreign banks and governments are between $65 billion and $130 billion (£41 billion and £83 billion); including claims for reparations in two wars, the bill could be $380 billion. Never mind British efforts to get policemen to turn up for work in Basra; so far, no one has the authority to pay them until creditors’ claims are settled.

To reschedule this debt will probably involve the Paris Club, the group of countries who have lent money to other governments. Given that the United Nations has been in charge of selling Iraq’s oil under the Oil-for-Food programme, its backing will be needed for any change of plan. Much as Washington may loathe the idea, getting Iraq back on its feet quickly will mean negotiations with both.

But beyond this? In a nation-builder’s dream, the sums it is possible to spend on Iraq in life after war range from $26 billion, on the most meagre estimates, to more than ten times that figure.

At this point few want to hazard a guess; it has been years since foreign businesses have had the chance to take a hard commercial look at much beyond the oil industry. UN teams are planning to go out soon but still lack a remit.

But even on the first estimates nothing about this venture looks cheap.

Peacekeeping

Peacekeeping is the first decision for the United States to make; all the same, it is the hardest item to quantify, with the nature of the peace still so unclear. Of course, American intentions are perfectly clear: as President Bush has put it, forces will stay as long as necessary and not a moment longer. The Pentagon and the independent Congressional Budget Office reckon that each American peacekeeper costs $250,000, based on the Bosnian experience.

But William Nordhaus, an economist who has carried out one of the few estimates of Iraqi reconstruction, points out that if the “dangers resemble . . . the West Bank more than the Balkans” the cost will be higher. How many of them would there be and how long would they stay? It’s anyone’s guess. But if the US kept 100,000 of the 250,000 in the region there for a year, that would cost $25 billion.

Reconstruction

A very basic model for reconstruction would cost between $20 billion and $25 billion. The same sort of figure emerges out of several different approaches. The World Bank has estimated that reconstruction after a war cost about $1,000 per head in East Timor, Lebanon and Bosnia. For Iraq, a similar level of spending would amount to about $25 billion.

Another way to look at it, Nordhaus suggests, is to aim to give Iraq a national income per head equal to that of Egypt or Iran. Assuming that half the country’s physical assets — roads, buildings and so on — needed reconstruction, this would require spending $800 per Iraqi, or about $20 billion.

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