Hunkered down in the back of a car, Ali Tarhouni sucks on a cigarette and gazes out at Libya's eastern city of Benghazi. It's been just eight months since he ditched his job as a senior lecturer at the University of Washington's business school and flew to his native country to join the revolution. Muammar Qaddafi is dead, and as Libya's interim oil and finance minister he's contemplating the daunting tasks ahead. Outside the window garbage is piled high, buildings are crumbling, street lights are out. And people are mobbing the car, screaming ecstatically, "Dr. Ali! Dr. Ali!" as if he were a rock star. "Look at this," he tells me. "This is a wealthy country, yet you can smell the sewage everywhere. And people expect you have a magic wand to change things."
Changing Libya -- its poverty, its joblessness, or its lack of economic growth -- will require more than magic. But change is crucial: It will determine whether this vast, oil-rich country becomes a democracy -- and a stable market for global corporations -- or slides into chaos.
Right now both scenarios seem possible. At least 20,000 Libyans have been killed, many of them civilians. Neighborhoods stand shattered, from the oil refinery town of Zawiyah to the port cities of Misurata and Sirte, where rebels killed Qaddafi on Oct. 20.
Bad as the toll is, Qaddafi's 42- year dictatorship left deeper scars. Repressive socialism stifled homegrown enterprises and drove countless smart Libyans, like Tarhouni, into exile. For years Qaddafi banned schools from teaching English, claiming it embodied Western evil; road signs are still Arabic-only. Unemployment exceeds 20%. Revenue collection is patchy. "I got an electricity bill about a year ago," laughs Youssef Sawani, until February the director of the foundation of Qaddafi's hugely powerful son Saif al-Islam, who was still on the run from rebel fighters in late October. "Why would I pay it? No one does."
And yet Libya is awash in money. Its foreign-currency reserves are by some estimates about $250 billion -- an astonishing sum for a nation of just 6.4 million people. It has Africa's largest proven energy reserves, with more than 46.4 billion barrels of oil and about 1.49 trillion cubic meters of natural gas. Until the civil war halted oil production, Libya pumped about 1.6 million barrels a day (by comparison, the U.S. pumps about 9.7 million barrels daily); by late October it was sputtering back with about a third that volume.
