Nothing really new there. It has been known for some time that part of the plan for the invasion of Iraq was to use it as a great example, to build a shining wonderful state that could serve to show the middle east, the US and the world just how good radical right wing free market economy and government could be.

The Pentagon and the State dept where specifically excluded from the reconstruction, a whole new organization was built with people selected for their political beliefs. Anyone that was surprised that this proved to be a failure of the first order probably would have been exactly the sort of person they where looking for to take these jobs.

Even if radical free market economics and libertarian government are good ideas in some cases (a point which is itself arguable), trying to build such a different system in Iraq was doomed from the start. Iraq was a badly run state economy, it had none of the support systems, information systems and strong economies needed for these things to work.

Jay