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Abstract

The national economy has been the primary and most significant victim of successive crises and irrational state policies, resulting in heavy burdens that have exceeded the populace's capacity to endure, manifested in deteriorating living conditions and the loss of numerous rights and opportunities; this, in turn, has led to a decline in life expectancy, work enthusiasm, and a regression in all socio-economic indicators that measure societal dynamism. Currently, the Iraqi economy suffers from a complex, multi-dimensional crisis, prominently characterized by explosive inflation rates, alongside other facets such as the stagnation of productive capacities, unemployment, and the absence or decline of economic growth, all of which culminate in the erosion of real income and the standard of living and consumption. The fragility of the economic structure became starkly evident following the imposition of international economic sanctions, which induced a profound economic recession accompanied by record inflation rates—primarily driven by the collapse of the production and supply apparatus and a surge in the general price level, even amidst low aggregate demand. Furthermore, the shocks sustained by the oil sector over the last two decades of the twentieth century, coupled with the weak contribution of other productive sectors, have plunged the Iraqi economy into a severe, protracted recessionary cycle, pushing macroeconomic growth rates into negative territory. In the context of such economic decline, any expansionary monetary or fiscal policy inevitably leads to uncontrollable inflation. Moreover, under these circumstances, any challenge to the state's economic role—ranging from its ownership of a strategic public sector to its direct planning and indirect supervision of overall economic activity—will hinder the structural transformations necessary for the Iraqi economy; the economic spontaneity or "laissez-faire" freedom advocated by radical capitalists is suitable only for advanced stages of capitalist development and is inapplicable to economies undergoing transitions from underdevelopment to development. This research proceeds from the hypothesis that the current monetary inflation in Iraq and the elevated general price levels result from the deterioration and paralysis of Iraqi productive forces, where a decline in the supply of goods is met with increasing, non-productive government spending; consequently, unless the wheels of national production begin to turn immediately and rapidly, none of the manifestations of the current economic crisis, including inflation, can be remedied, as the solution lies in a fundamental strategic shift in overall economic, social, and political methodologies and frameworks.

DOI

10.33095/jeas.v14i49.1379

Subject Area

Economics

First Page

125

Last Page

138

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