WHAT a difference victory makes. The United States now looks set to get almost all of what it wants from the new United Nations resolution on rebuilding Iraq.

For Colin Powell, notoriously wary of leaving Washington for fear of what will be planned in his absence, his breathless circuit of the Middle East, Russia and Europe has paid off. The Secretary of State, in Moscow yesterday, has established that neither Russia nor France has the support to block a resolution crafted pretty much as Washington wants, so keen are members of the Security Council now to repair ties.

But the American success may backfire. It has given itself so much control over Iraq’s everyday business that the question of who wins new contracts, economically unimportant but hugely symbolic, may inflame opposition to its plans.

Powell said yesterday that the US could probably put up with a suspension of UN sanctions against Iraq, rather than the cut-and-dried lifting of sanctions it wanted. It is a concession that Washington will find annoying, but it is not important. The significance of it is only that suspension of sanctions preserves a possible role for UN arms inspectors at some later stage.

That concession does not affect the most important provision of the resolution — the big surprise when the draft was revealed — which is that the US and Britain intend to keep much more control over the way Iraq spends its oil money than many expected, apart from their most sceptical critics. The US and Britain, referred to as “the Occupying Power” in the draft resolution, will “consult” with the new interim Iraqi authority, yet to be set up, but its views will not ultimately determine which contracts are signed.

So the interim Iraqi authority will have less power than its Afghan equivalent; it is no coincidence that there is more money in Iraq, and more strategically at stake.

The other main contentious question in the resolution is what role the US will allow the UN. On this point, the answer is slightly more than American critics have charged. In fact, the US sounds positively anxious to have the UN involved. It just does not want to surrender control over the make-up of the interim authority, enabling Russia or some other country with ties to the previous regime to fill the new government with old Baathists.

Can the US get UN backing for a resolution that serves its own interests so well? Probably. France and Russia are the two Security Council members that dislike it most, but they object to different bits and are susceptible to different diplomatic offers.

Russia cares most about control of the oil, and in particular the fate of the Oil-for-Food programme. It has outstanding contracts under this programme said to be worth more than $1.5 billion (£0.92 billion) and it wants them honoured. The US is desperate to prevent anyone who thinks Iraq owes him money slapping a writ on the first Iraqi tanker to set out into the Gulf.

But those intensely complicated technical issues of title and immunity from claims are not directly affected by the row over lifting sanctions. Russia’s support on that point may be forthcoming in return for reassurance about its money.

France cares more about the role of the UN. The US may sweeten the language on this but not change the substance.

And the others? Germany, where Powell arrives today, appears receptive to the US position on sanctions. Like many countries that distanced themselves from the US before the war, it now seems keen to put the row in the past.

Dirty oil money

DOES oil wealth always lead to corruption? Christian Aid says so in a report this week. It staples this claim to the even more ambitious one that oil makes countries poorer, not richer, and that Western “addiction” to this “drug of choice” is “directly contributing to misery and suffering in developing countries”.

This is a patronising and fatalistic report, written in uniformly shrill language, culminating in giddy recommendations. It wants non-governmental organisations to be trained and funded to scrutinise government spending in oil countries. It says that the democratic failures “must be reversed”. Quite so.

But the report is shrewd in one respect: its timing. The question of whether oil can be separated from corruption and economic failure, a matter of academic debate for years, is now live, indeed it fuels the row over the powers of the new Iraqi interim authority.

A more astute take on the subject is found in The Future of Freedom, the new book by Fareed Zakaria, editor of Newsweek International.

The causes of the problem are well-analysed: the temptation for leaders to keep oil revenues for themselves and the lack of incentive to invest in education or other industries. In widely quoted research, the Harvard economists Jeffrey Sachs and Andrew Warner, looking at 97 developing countries over two decades, found that the richer a country was in natural resources, the more slowly it grew.

Does it have to be that way? Zakaria, an optimist as these things go, argues that it does not — and that Iraq is one of the best places to break the pattern, because it almost did so in the past. Blessed with oil and, even more importantly, with water, before the Saddam era it was “one of the most advanced, literate and secular countries in the region”.

But even Zakaria does not argue that immediate, full democracy is always the best way to find that path. If the US wins the resolution it wants from the UN, it will seem that others agree.

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