The Post-Washington Dissensus

This is a quite interesting article. As Bello details some of the alternatives they sound little better than the original Wasington Consensus if not worse.


Foreign Policy in Focus
September 24

THE POST-WASHINGTON DISSENSUS
Walden Bello*

When two studies last year detailed how the World Bank's research
unit had been systematically manipulating data to show that neo-
liberal market reforms were promoting growth and reducing poverty in
developing countries, development circles were not shocked. They
merely saw the devastating findings of a study by American University
Professor Robin Broad and a report by Princeton University Professor
Angus Deaton and former International Monetary Fund chief economist
Ken Rogoff as but the latest episode in the collapse of the so-called
Washington Consensus.

Taking off from Margaret Thatcher's famous remark, partisans of this
development model during its heyday the 1980s and early 1990s claimed
that the alternative to the Washington Consensus was TINA -- that is,
"There is no alternative." The Washington Consensus broke with
economic strategies involving heavy participation by government and
positioned the unfettered market as the driver of development.

Imposed on developing countries in the form of "structural
adjustment" adjustment programs funded by the International Monetary
Fund (IMF) and the World Bank, the Consensus reigned until the late
1990s, when the evidence became clear that on all key criteria of
development -- sustained growth, poverty reduction, and reduce
inequality -- it simply was not delivering. By the first half of
this decade, the Consensus had undergone a process of unraveling,
although neo-liberalism remained the default mode for many economists
and technocrats that had lost confidence in it, simply out of inertia.

The former adherents of the Consensus have gone off in divergent
directions. Despite frequent references to it, there is, in fact, no
"Post-Washington Consensus."

WASHINGTON CONSENSUS PLUS
Mindful of the failures of the Washington Consensus, the IMF and the
World Bank are now promoting what Nobel laureate Joseph Stiglitz has
disdainfully described as the "Washington Consensus Plus" approach,
that is, that market reforms, while crucial, are not enough.
Financial reforms, for instance, must be "sequenced," if we are to
avoid such debacles as the Asian financial crises, which even the
Fund now admits was due to massive capital inflows into countries
that liberalized without strengthening their "financial
infrastructure." Mindful of the Russian descent into the hell of
mafia capitalism in the 1990s, the two institutions also now talk
about the importance of accompanying market reform with institutional
and legal reforms that can enforce private property and contracts.
Other accompaniments of market reforms are "good governance" and
policies to "develop human capital" such as female education.
This mix of market and institutional reforms were consolidated in the
first years of this decade in the so-called Poverty Reduction
Strategy Papers (PRSP's). In contrast to what one analyst has
described as the "bare knuckle neo-liberalism" of structural
adjustment programs, PRSPs were not only more liberal in content but
in process: they were supposed to be formulated in consultation with
"stakeholders," including civil society organizations.
Despite its icing of institutional reforms, the core of the PRSP cake
remains the same macroeconomic fundamentals of trade liberalization,
deregulation, privatization, and commercialization of land and
resources at the heart of structural adjustment programs. And
community consultation has been limited to well-resourced, liberal
non-governmental organizations rather than broad-based social
movements. PRSPs indeed are simply second generation structural
adjustment programs that seek to soften the negative impact of
reforms. As IMF Managing Director Rodrigo Rato has admitted, the
purpose of institutional reforms is "to make sure that the fruits of
growth are widely shared and the poorest people are protected from
the costs of adjustment" in order to prevent people from being
"tempted to give up on orthodox economic policies and structural
reforms."

NEOCONSERVATIVE NEOLIBERALISM
A second successor to the Washington Consensus is what one might call
the "neoconservative neo-liberalism." This approach is essentially
the development policy of the Bush administration. The inspiration
for this strategy was provided by the famous 2000 report of a
congressional commission on multilateral institutions headed by
conservative academic Alan Meltzer, which proposed a radical slimming
down of the World Bank. It supports-at least rhetorically--debt
relief for the poorest countries on the ground that they won't be
able to pay the debt and seeks a shift from loans to grants.
However, debt relief and grant aid are conditioned on how governments
perform in terms of liberalizing their markets and privatizing their
industries, land, and natural resources. Indeed, the main reason for
preferring grants is that, in contrast to loans channeled through the
World Bank, grants, as Undersecretary of State John Taylor put it,
"can be tied more effectively to performance in a way that longer-
term loans simply cannot." Moreover, grants would allow pro-market
reforms and aid policy generally to be more directly coordinated with
Washington's security objectives and with the agenda of US
corporations. Compared to the original Washington Consensus,
neoconservative neoliberalism is less doctrinaire, but in an
illiberal direction, ready, as it is, to let the market play second
fiddle to power.

NEOSTRUCTURALISM
A third distinctive successor to the Washington Consensus,
neostructuralism, moves, in contrast, in a more liberal direction.
This is an approach associated with the Economic Commission for Latin
America (CEPAL) that produced the structuralist theory of
underdevelopment in the 1950s under the leadership of the venerable
Argentine economist Raul Prebisch. According to neostructuralism,
neoliberal policies have simply been too costly and
counterproductive. In fact, there is no trade-off between growth and
equity, as the neoliberals claim, but a "synergy." Less inequality
in fact would enhance, not obstruct, economic growth by increasing
political and macroeconomic stability, boosting the saving capacity
of the poor, raising educational levels, and expanding aggregate
demand. The neostructuralists thus propose progressive transfer
payment policies that redistribute income in ways that increase the
human capital or productivity of the poor, including higher spending
for health, education, and housing programs. These are the kinds of
programs associated with what the Mexican polemicist Jorge Castaneda
has called the "Good Left" in Latin America, meaning the governments
of Lula in Brazil and the Concertacion alliance in Chile.
Being focused on managing transfer payments to protect and upgrade
the capacity of the poor, the neostructuralist approach does not
interfere with market forces in production, unlike the policies of
the "Bad Left" (meaning Hugo Chavez and friends) that intervene in
production, markets, and wage policies. The neostructuralists also
embrace globalization, and they say that a key objective of their
reforms is to make the country more globally competitive. Because
they simultaneously allegedly alleviate income disparities, upgrade
the capacity of the poor, and make the work force more globally
competitive, neostructuralist reforms are said to hold out the
prospect of making globalization more palatable, if not popular.
Neostructuralists proudly proclaim that their approach is the "high
road" to globalization, in contrast to the "low road" of the
neoliberals.
The problem is that neostructuralist reforms have led to what one
of its most thoughtful critics, Chilean economist Fernando Leiva,
calls the "heterodox paradox," that is, in the quest for systemic or
comprehensive competitiveness, the carefully crafted neostructuralist
policies have actually led to "the politico-economic consolidation
and regulation of neoliberal ideas and policies." In the end,
neostructuralism, like the Washington Consensus Plus approach, does
not fundamentally reverse but simply mitigate the poverty and
inequality-creating core neoliberal policies. The Lula government's
targeted anti-poverty program may have reduced the ranks of the
poorest of the poor but institutionalized neoliberal policies
continue to reproduce massive poverty, inequality, and stagnation in
Latin America's biggest economy.

GLOBAL SOCIAL DEMOCRACY
The more than residual attachment to neoliberalism of
neostructuralism is less evident in the case of what we might call
global social democracy, an approach that has become identified with
people such as economist Jeffrey Sachs, sociologist David Held, Nobel
laureate Joseph Stiglitz, and the British charity Oxfam. Unlike the
three previous approaches, this perspective acknowledges the fact
that growth and equity may be in conflict, and it ostentatiously
places equity above growth. It also fundamentally questions the
central thesis of neoliberalism: that for all its problems, trade
liberalization is beneficial in the long run. Indeed, Stiglitz says
that in the long run, trade liberalization may in fact lead to a
situation where "the majority of citizens may be worse off."
Moreover, the global social democrats demand fundamental changes in
the institutions and rules of global governance such as the IMF, WTO,
and the Trade Related Intellectual Property Rights Agreement
(TRIPs). David Held, for instance, calls for the "reform, if not
outright abolition, of the TRIPs Agreement," while Stiglitz, says
that "rich countries should simply open up their markets to poorer
ones, without reciprocity and without economic or political
conditionality." Also, "middle-income countries should open up their
markets to the least developed countries, and should be allowed to
extend preferences to one another without extending them to the rich
countries, so that they need not fear that imports might kill their
nascent industries."
The global social democrats even see the anti-globalization
movement as an ally, with Sachs thanking it "for exposing the
hypocrisies and glaring shortcomings of global governance and for
ending years of self-congratulation by the rich and powerful." But
globalization is where the global social democrats draw the line.
For, like classical neoliberalism, the Washington Consensus Plus
school, and neostructuralism, global social democracy sees
globalization as necessary and fundamentally sound and, if managed
well, as bringing benefits to most.
Indeed, the global social democrats see themselves as saving
globalization from the neoliberals. This is all the more important
because, contrary to an assumption that was gospel truth just a few
years ago -- the globalization was irreversible -- the global social
democrats worry that contemporary globalization is, in fact, in
danger of being reversed, and they hold up as a cautionary tale about
the consequences of such a development the turbulent reversal of the
first wave of globalization after 1914.
To Sachs, Held, and Stiglitz, the benefits of globalization
outstrip the costs, and what the world needs is a social democratic
or "enlightened globalization" where global market integration
proceeds but is one that is managed fairly and is accompanied by a
progressive "global social integration." The aim, as Held puts it, is
to "provide the basis for a free, fair, and just world economy,"
where the "values of efficient and effective global economic
processes...function in a manner commensurate with self-
determination, democracy, human rights, and environmental
sustainability."

CAN GLOBALIZATION BE HUMANIZED?
There are several problems with global social democracy's attachment
to globalization.
First of all, it is questionable that the rapid integration of
markets and production that is the essence of the globalization can
really take place outside a neoliberal framework whose central
prescription is the tearing down of tariffs walls and the elimination
of investment restrictions. Slowing down and mitigating this
inherently destabilizing process, not reversing it, is the global
social democratic agenda. That global social democrats have come to
terms with the fundamental tendency of global market forces to spawn
poverty and inequality is admitted as much by Sachs who sees social
democratic globalization as "harnessing [of] the remarkable power of
trade and investment while acknowledging and addressing limitations
through compensatory collective action."
Secondly, it is likewise questionable that, even if one could
conceive of a globalization that takes place in a socially equitable
framework, this would, in fact, be desirable. Do people really want
to be part of a functionally integrated global economy where the
barriers between the national and the international have
disappeared? Would they not in fact prefer to be part of economies
that are susceptible to local control and are buffered from the
vagaries of the international economy? Indeed, the backlash against
globalization stems not only from the inequalities and poverty it has
created but also the sense of people that they have lost all
semblance of control over the economy to impersonal international
forces. One of the more resonant themes in the anti-globalization
movement is its demand for an end to export-oriented growth and the
creation of inwardly-oriented development strategies that are guided
by the logic of subsidiarity, where the production of commodities
takes place at the local and national level whenever that is
possible, thus making the process susceptible to democratic regulation.

THE LARGER PROBLEM
The fundamental problem with all four successors to the Washington
Consensus is their failure to root their analysis in the dynamics of
capitalism as a mode of production. Thus they fail to see that
neoliberal globalization is not a new stage of capitalism but a
desperate and unsuccessful effort to overcome the crises of
overaccumulation, overproduction, and stagnation that have overtaken
the central capitalist economies since the mid-seventies. By
breaking the social democratic capital-labor compromise of the post-
World War II period and eliminating national barriers to trade and
investment, neoliberal economic policies sought to reverse the long-
term squeeze on growth and profitability. This "escape to the
global" has taken place against the backdrop of a broader conflict-
ridden process marked by renewed inter-imperialist competition among
the central capitalist powers, the rise of new capitalist centers,
environmental destabilization, heightened exploitation of the South
-- what David Harvey has called "accumulation by dispossession" --
and rising resistance all around.
Globalization has failed to provide capital an escape route from its
accumulating crises. With its failure, we are now seeing capitalist
elites giving up on it and resorting to nationalist strategies of
protection and state-backed competition for global markets and global
resources, with the US capitalist class leading the way. This is the
context that Jeffrey Sachs and other social democrats fail to
appreciate when they advance their utopia: the creation of an
"enlightened global capitalism" that would both promote and
"humanize" globalization.

Late capitalism has an irreversible destructive logic. Instead of
engaging in the impossible task of humanizing a failed globalist
project, the urgent task facing us is managing the retreat from
globalization so that it does not provoke the proliferation of
runaway conflicts and destabilizing developments such as those that
marked the end of the first wave of globalization in 1914.

*Walden Bello is professor of sociology at the University of the
Philippines and senior analyst at the Bangkok-based research and
advocacy institute Focus on the Global South.

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Hearings to be held on prison population increase

Imagine the US has 25 percent of the world's prisoners. I wonder if Americans still think the US is soft on criminals. Probably. The US has the highest incarceration rate in the world.

WEBB TO HOLD HEARING ON PRISON EXPLOSION

[

SENATOR JIM WEBB (D-VA) will hold a Joint Economic Committee hearing
to explore the economic consequences and causes of and solutions to
the steep increase of the U.S. prison population. The hearing
entitled, "Mass Incarceration in the United States: At What Cost?" -
in light of 500 percent increase in prison populations in last 30
years - is scheduled for Thursday, October 4, 2007 at 10:00 am in
Room 216 of the Hart Senate Office Building. The United States has 25
percent of the world's prisoners, despite having only 5 percent of
the world's population. The JEC will examine why the United States
has such a disproportionate share of the world's prison population,
as well as ways to address this issue that responsibly balance public
safety and the high social and economic costs of imprisonment. Expert
witnesses have been asked to discuss the costs of maintaining a large
prison system; the long-term labor market and social consequences of
mass incarceration; whether the increase in the prison population
correlates with decreases in crime; and what alternative sentencing
strategies and post-prison re-entry programs have been most
successful at reducing incarceration rates in states and local
communities.

http://webb.senate.gov/

Goodman, Parsi, Abrahamian discussion of Ahmadinejad's speech at Columbia

Discussion by Amy Goodman, Trita Parsi, and Ervand Abrahamian. It is interesting that there seems to be a consensus that Iran does not really believe that the US or Israel will attack it. Iran surely does not read the US very well. I thought that Ahmadinejad was trying to lower the temperature a bit but I guess it did not come over that way to most people.



In a speech at Columbia University, Iranian President Mahmoud
Ahmadinejad defended Iran's right to nuclear power but denied Iran
was seeking to build nuclear weapons. Ahmadinejad's appearance
sparked widespread protests at Columbia. We speak with Trita Parsi,
author of "Treacherous Alliance: The Secret Dealings of Israel, Iran
and the United States" and Baruch professor Ervand Abrahamian, co-
author of "Targeting Iran." [includes rush transcript]
Ervand Abrahamian, Iran expert and CUNY Distinguished Professor of
History at Baruch College, City University of New York. He is the
author of several books on Iran and the co-author of a new book from
City Lights called "Targeting Iran."
Trita Parsi, President of the National Iranian American Council
(NIAC), the largest Iranian-American organization in the US. He is
the author of "Treacherous Alliance: The Secret Dealings of Israel,
Iran, and the United States."
RUSH TRANSCRIPT
This transcript is available free of charge. However, donations help
us provide closed captioning for the deaf and hard of hearing on our
TV broadcast. Thank you for your generous contribution.
Donate - $25, $50, $100, more...

AMY GOODMAN: For more on Ahmadinejad's visit, we're joined by two
guests. Ervand Abrahamian is an Iran expert and CUNY Distinguished
Professor of History at Baruch College here at the City University of
New York. He's the author of several books on Iran, co-author of a
new book from City Lights called Targeting Iran. And joining me from
Washington, D.C. is Trita Parsi. He’s the president of the National
Iranian American Council, the largest Iranian American organization
in the United States, author of Treacherous Alliance: The Secret
Dealings of Israel, Iran and the United States.

First, Ervand Abrahamian, can you talk about the president's visit?
Did anything he said -- this is Mahmoud Ahmadinejad -- surprise you?

ERVAND ABRAHAMIAN: Well, I was surprised because he didn't really use
the opportunity to try to lower the tempo, the serious problem we
have now, which is we're at the abyss of war, basically. And there
are people pushing for war in the next few months. And this would
have been a very good opportunity to try to smooth things over, try
to calm the tempo down.

And it's not just he who missed the opportunity. I think Bollinger
missed the opportunity. In fact, Bollinger's speech was like a
drumbeat for war. And most of the questions from the audience missed
the opportunity. They dealt basically with important identity
questions, but they didn't really deal with the issue that we are
really on the abyss of war. And this is a far more serious issue
than, you know, either ethnic or gender issues.

And he, actually, I think -- although he made some statements about
Iran is not interested in nuclear weapons, he could have been more
forthright and more categorical about the policies of Iran in terms
of the nuclear project.

AMY GOODMAN: Does this remind you of Saddam Hussein before the war?

ERVAND ABRAHAMIAN: It does. In fact, Ahmadinejad didn't say it last
night -- yesterday, but his policy is that there is no likelihood of
war, because no one in their right senses would think of invading or
attacking Iran. And that's the premise he works on, which is, I
think, a completely wrong premise, because he doesn't seem to
understand American politics, the same people who gave us the war on
Iraq, the same people who are running foreign policy now. But he
begins from the premise that no one in their right senses would think
of attacking Iran.

AMY GOODMAN: Trita Parsi, you have written a very interesting book,
Treacherous Alliance: The Secret Dealings of Israel, Iran and the
United States. Can you take us back in time and talk about the
relationship, the secret dealings, between these three countries?

TRITA PARSI: Israel has for a very long time been a critical factor
in America's formulation of a policy vis-à-vis Iran. But what's
really interesting is that the influence of Israel has gone in
completely different directions, if we just go back fifteen years.
During the 1980s, in spite of the Iranian Revolution, in spite of
Ayatollah Khomeini’s many, many harsh remarks about Israel, far, far

worse than what anything Ahmadinejad has said so far, Israel at the
time was the country that was lobbying the United States to open up
talks with Iran to try to rebuild the US-Iran relations, because of
strategic imperatives that Israel had. Israel needed Iran, because it
was fearing the Arab world and a potential war with the Arabs.

After 1991, ’92, that's when you see the real shift in Israeli-
Iranian relations, because that's when the entire geopolitical map of
the Middle East is redrawn. The Soviet Union collapses. The last
standing army of the Arabs, that of Saddam Hussein, is defeated in
the Persian Gulf War. And you have an entirely new security
environment in the Middle East, in which the two factors, the Soviets
and the Arabs, that had pushed Iran and Israel closer together
suddenly evaporate. But as their security environment improves, they
also start to realize that they may be ending up in a situation in
which they can become potential threats to each other. And that's
when you see how the Israelis shift 180 degrees. Now the Israeli
argument was that the United States should not talk to Iran, because
there is no such thing as Iranian moderates.

And ever since, the Israelis and the pro-Israel interest in the
United States have lobbied to make sure that there is no dialogue or
there’s no rapprochement between the United States and Iran. And the

Iranians have done similar things. They have undermined every US
foreign policy initiative in the Middle East that they feared would
be beneficial to Israel. So the real shift in Israeli-Iranian
relations come after the Cold War, not with the revolution in 1979.

AMY GOODMAN: But I also do want you to go right back to 1948 and talk
about that period up to 1991. What were the secret relationships?

TRITA PARSI: Well, immediately after Israel was founded, Iran was
actually one of the states on the committee at the UN who was
preparing a plan, and they were against the partition. They were
against the idea of creating two states. And Iran, at the time, said
that this would lead to several decades of crisis. But once Israel
was a fact, the Iranian government felt that because it was facing a
hostile Arab world, as well as a very hostile Arab ideology, Pan-
Arabism, Israel was a potential ally for the Iranians, particularly
as Israel started to shift closer and closer to the Western camp and
the United States. So throughout the ’50s, ’60s and ’70s, the
Iranians and the Israelis were working very, very closely together,
had a very robust alliance.

They tried to keep it secret. It wasn't necessarily very secret, but
Iran never recognized Israel de jure. They recognized it de facto.
They had an Israeli mission in Tehran, but they never permitted it to
be called an embassy. They had an Israeli envoy to Tehran, but they
never called him an ambassador. When the Israeli planes were landing
at the Tehran airport, they created -- they built a specific tarmac
off the airport for Israeli planes to land, so that no one would
really see that there are so many El Al planes flying to Tehran. And
the reason why the Iranians were doing this is because, on the one
hand, they needed Israel as an ally because they were fearful of the
Arab world, and, on the other hand, they felt that if they got too
close to Israel, they would only fuel Arab anger towards Iran.

[...]

AMY GOODMAN: Trita Parsi is author of Treacherous Alliance: The
Secret Dealings of Israel, Iran and the United States. Our guest
also, Ervand Abrahamian, Iran expert, Distinguished Professor at
Baruch College. I wanted, Professor Abrahamian, to read from Juan
Cole's piece, who says, talking about Ahmadinejad, “He has been
depicted as a Hitler figure intent on killing Israeli Jews, even
though he is not commander in chief of the Iranian armed forces, has
never invaded any other country, denies he is an anti-Semite, has
never called for any Israeli civilians to be killed, and allows
Iran's 20,000 Jews to have representation in Parliament,” that
Khamenei is the one with the real power.

ERVAND ABRAHAMIAN: He is right on target, yes. I think Juan Cole sums
it up. And the question is, then, why is basically in American
politics so much focused on Ahmadinejad? I think he serves the
function that Saddam Hussein played. He's an easy person to demonize.
And yesterday's Bollinger's introduction, when he described him as a
dictator, I think, shows how little people like Bollinger really know
about the Iranian political system. One can call Ahmadinejad many
things, but a dictator he is by no means. He can’t even -- he doesn't

even have the power to appoint his own cabinet ministers. It's a
presidency with very limited power. And to claim that he is in a
position to threaten the United States or Israel is just bizarre,
frankly. I think someone like Bollinger should know more about Iran
before they sling around smears like terms such as “dictator.”

AMY GOODMAN: Well, talk about Khamenei, then, if he is the one with
real power.

ERVAND ABRAHAMIAN: Here, again, he is, you can say, the Supreme
Leader, but the Iranian system is actually very sort of a collective
leadership. The foreign policy is made in a council, where the
Supreme Leader appoints those members, but there are very different
views there. And Ahmadinejad does not run that committee. Someone
like Rafsanjani has a great deal of influence. The former President
Khatami has a great deal of influence. And they are much more willing
to negotiate.

In fact, they were, I think, the people who offered this grand
bargain in 2003 to settle all the issues with the United States. And
for reasons that are not clear, the White House just basically
brushed it aside. They were not interested in pursuing this. And this
is why it leads me to think that this administration is adamant in
resolving the nuclear problem by military force, because if it was
interested in resolving it through diplomacy, there were offers made
to them to follow that route, and they have very consciously decided
not follow the diplomatic routes. So if you don't follow the
diplomatic route, the only other route there is is the military
route. And, of course, it’s only a question of time when they decide

on air strikes.

[...]

AMY GOODMAN: When is the election?

ERVAND ABRAHAMIAN: In less than two years' time. And the base, in
fact, of Ahmadinejad’s -- I would say the core base -- is very
similar to Bush's core base. It's about 25%. For him to get re-
elected, he has to stretch out and find independents and others, and
this is going to be very hard. If the reformers can actually rally
around one candidate, as they did in the 1990s, they could have
landslide victories, in which over 70% of the electorate was voting
for liberals and reformers.

AMY GOODMAN: And what direction would a US attack on Iran push the
election?

ERVAND ABRAHAMIAN: Oh, it would play right into the hands of
Ahmadinejad, because you would have a national emergency. He would
declare, basically, the country's in danger. Everyone would have to
rally around the flag. People who disliked him would keep their mouth
shut. At a time of when the existence of the state is in question,
you don't mess around with the leaders. He would basically be able to
act as a much more of a strongman national leader.

AMY GOODMAN: Trita Parsi, you've had unusual access to US decision
makers, Israeli decision makers, Iranian leaders. What is your sense
of a strike, the US or Israel, on Iran? Is it imminent?

TRITA PARSI: Well, I don't think an Israeli strike is imminent,
unless there is some sort of coordination with the United States with
the aim of being able to draw the US into the conflict. I do believe
that some sort of a conflict between the United States and Iran is
quite probable right now, mindful of the lack of diplomacy that is
taking place.

And I also do believe that this is not necessarily something that
will go away automatically just because there's going to be a change
of government in the United States within the next two years. Many of
the decisions that are made right now have the impact of limiting the
maneuverability of future administrations. We're making it more and
more difficult, not only for this administration, but also for future
administrations, to pursue diplomacy.

And what we're seeing in the Middle East right now is not necessarily
just a conflict over what's going on in Iraq or about Iran's nuclear
program. This is a conflict that, at the end of the day, is about two
powerhouses in the region, and it's a conflict about hegemony, for
lack of a better word.

And these type of shifts, with the United States currently declining
and finding itself in a more and more difficult situation in Iraq and
with Iran finding itself in a stronger position and acting very, very
confidently, these type of shifts historically do not take place
peacefully, unless there is a tremendous amount of diplomacy. And
again, we're not seeing that right now.

And I’m very concerned that even if we manage to avoid war for the
next two years, the next US administration may find itself in a
position in which its maneuverability is so limited that the military
option once again becomes a very viable one for them.

[...]

J. Jay Park on the Iraq Oil Law.

This fellow obviously knows his stuff. The mainstream media hardly noticed the Dubai meeting even though it was obviously very important. I guess it was just not sexy enough! Interesting that Park was involved in drafting a law for Somalia. The development of oil there is a part of the determination not to allow the Islamists to gain control. Until the security situation improves there is not likely to be much development.
The Iraq oil law still seems to be in limbo.

Interview: J. Jay Park on the Iraq oil law


Published: Sept. 26, 2007 at 6:02 PM
Print story Email to a friend Font size:By BEN LANDO
UPI Energy Editor
DUBAI, United Arab Emirates, Sept. 26 (UPI) -- J. Jay Park's work on international legal petroleum regimes has taken him around the world. He helped craft Somalia's new hydrocarbons law and has led training sessions for officials in Iraq's Oil Ministry.

He also represented Western Oil Sands, a Canadian firm, in its deal with the Iraqi Kurdistan Regional Government.

Earlier this month in Dubai, Park held a daylong workshop on the ins and outs of Iraq's draft oil law, as part of the Iraq Petroleum 2007 summit, organized by The CWC Group. Also at the summit were representatives from oil firms around the world, as well as top Iraqi oil officials, including Oil Minister Hussain al-Shahristani.

United Press International sat down with Park on the sidelines of the summit to discuss the mind frame for crafting an oil law; what decisions the Iraqi government now faces; what type of regime Iraq can choose from; and what types of contracts -- including the controversial production sharing agreement -- work for Iraq's oil.

UPI: You’ve worked either with companies working within certain legal regimes or helped the governments set up legal regimes, so you’ve seen this from both sides. Looking at the Iraq situation, how do you see them being able to find compromise, to agree on … to pass an oil law, either this (draft) one or another one?

Park: When I’m looking at a resource law from a legal standpoint there are certain attributes that I want to see it addresses. The attributes from the point of view of the state are: is there going to be fair share of resource revenue going to the state? Is there going to be adequate addressing of environmental, health and safety issues? Are they going to ensure there are local benefits accruing to the economy through employment, through training, through technology? Are they going to ensure that opportunities for development in respect to the resource can be seized within the economy and not just exported? And is there a transparent process for the award of rights and the administration of the business?

From the point of view of the investor, what they want to know is: is this a regime in which if they make a discovery they will be able to complete that development so they can monetize the investment that they make? Number two, is the agreement a stable agreement so that once they make an investment they’re going to be able to recover what they’ve invested, so the deal won't change on the them, which is a problem we see in a lot of places, what we call the problem of the obsolescing bargain? And then finally, are they going to be able to have adequate legal means for remedies if there is non-compliance with the agreement?

So if you’ve got all those features addressed in a petroleum law then I think the law itself is a good law because it addresses well the issues that arise between a state and investor. That’s what I look at. That’s a technical kind of analysis.

When you then say, politically, how are they going to get this passed, that to me is really an issue for Iraqis. One of the things that I always look to is this issue of the sharing of the resource. In Iraq, they address this issue in part in the constitution. It needed more definition in the petroleum law and a revenue-sharing law, and that is part and parcel of the process.

Now the biggest issue you have with respect to sharing of the resource revenue is who gets to receive the revenue. And I’m advised that there has been a deal, that they have agreed to share the revenue resulting from the resource economy on a demographically equal basis. That’s the biggest issue. If they have solved the biggest issue, all the other issues about who controls activity, they’re less important. So if they’ve solved the big issue, then already then in my view the other issues are surely able to be solved and therefore I’m optimistic the (oil) law is going to be passed. Because once you’ve solved the revenue issue and how you’re going to share it, then it’s in everyone’s interest to make the revenue pie bigger. And when you’ve got everybody aligned in that sense, then I think you’re going to see success.

Q: In the oil minister’s presentation, when asked about what happens if the law is dragged out for so long, and he said ‘well we have the legal right to move forward on our own because we need to develop whether there is a new law or not,’ can you explain that, what he bases that on?

A: Iraq has an oil law. It was passed in the 1980s. It is a short law, seven or eight pages, 17 articles. It grants the power to the government to manage the industry and award rights in respect to petroleum activities. It doesn’t contain a great deal of detail on how that is to be done and you can follow from that then there is a great deal of discretion in the government as to how it may run the industry under the terms of that law.

What I believe the ministry is saying by that is ‘there is not a vacuum with respect to petroleum law in Iraq. We’d like to see the new law passed because it’s a better law than the old law,’ and I’m inclined to agree. From a technical petroleum law viewpoint, the new law is a better law than the old law. What I think the minister is saying, in effect, ‘we want this law passed and if it isn’t passed then we’ll have to just work with the old law.’

Q: You started your presentation explaining your frame of mind when you go into drafting an oil law. We have the Iraq scenario where we know there’s a lot of oil and gas and we assume there’s a lot more oil and gas and the industry is already established for a long time. Compared to, for example, Somalia or another country where we think there might be oil and gas but we don’t know so that’s why we’re creating this regime so we can figure it out, we can have the legal tools to do the exploration and development. So what are your thoughts when you’re creating, what is the difference when you’re creating the law, your mind frame when you sit down to write it.

A: The difference between developing a law for a regime that does not know if it has any oil and gas versus developing a law for a regime that knows it has a substantial existing base is what do you do with a substantial existing resource base?

What many countries have done is they’ve established a state oil company and give it the management and ownership of the existing resource base. The enhancement and the development of that resource base is then within the control of that state oil company. But new exploration operations would then be open for assessment as to how the state should deal with that. Many states take different approaches to that.

Mexico says only the state oil company can do any exploration. Consequently, there’s not a great deal of exploration and Mexico’s production is declining because their state oil company lacks the capital to explore it extensively.

Other countries, I come from Canada, says ‘no, we’re not going to have a state oil company but we’re going to award these rights to private investors.’

Iraq has chosen a middle ground. Iraq has said a state oil company will hold the existing producing base. It will also hold the discovered but undeveloped areas that are close to existing production and it may invite other companies to assist it in developing those resources but fundamentally they will be owned by the state oil company.

Then with respect to exploration areas and other discovered areas that need a lot of work to develop them, the scope is broader for how that can be done in terms of many different types of petroleum contracts that could be used, with many different structures, although it's clearly suggested that a joint venture with Iraqi participants is to be encouraged.

Q: What would you say are the risks in entering Iraq’s oil sector?

A: The principle risk that oil companies are designed to address is geological risk …

Q: Is there oil or not, will you put the money in and come up with nothing …

A: … Exactly. That generally the record on exploration is that out of every 10 exploratory wells only one or two are going to be successful. But the geology and opportunities around the world vary widely and so clearly Iraq is one of those places where the geology offers wonderful opportunities because we’ve already seen how much exploration there’s been and there’s a great deal more yet to be explored. Clearly the geological risk in Iraq is less than it is in Ireland.

Q: In your presentation you had the four annexes up there. (The annexes are a draft list of the categories of Iraq’s oil fields and exploration blocks, which the Iraq Oil Ministry has created.) You said this is the contract that you would use for each. Can you explain what specific contract per annex and why not the other ones?

A: Annex 1 is just producing fields. It’s likely the existing producing fields involve minimal to no risk in terms of, you know, it’s producing and what’s needed is services to enhance production and enhance facilities to allow production to occur. In those regimes around the world that use a service contract, that’s the type of contract that it’s used for.

Other fields that need development work, drilling of further wells, construction of more significant facilities because they are not currently producing, often a development type contract is designed differently and has different work commitments and even you might need a different skill set as well, so that’s why I deduced from the language of the draft law that a development contract is something that is suited to that kind of an arrangement.

And finally when it comes to areas that don’t have a discovery, that’s where there is a more significant degree of risk and a risk exploration contract is best suited to that. It’s designed to encourage exploration activity and if exploration is successful, to allow development.

Q: What’s the difference between the risk contract and the exploration and development contract?

A: In my opinion you’re just mixing up different terms. An exploration and development contract and a risk exploration contract, to me, would mean the same thing.

Q: So the terms that they’re (Iraqi government) putting up there, why do they have these two mixed terms?

A: One, I believe, is intended to be a broad term to describe a wide range of contracts called exploration and development contracts and then the other term, the risk exploration contract, is a specific contract they have in mind. It’s one of the details of the law that needs to be further elaborated, either in the regulations or in the model contract.

Q: And if they decided to go the route of the production sharing agreement or some modified version that would fit within the law, where within these annexes would that fall? Would that be Annex 4?

A: A production sharing type contract could be a form of risk exploration contract that would be suited to Annex 4. The word development and production contract doesn’t to me define a specific type of agreement, it defines what the activities will occur under the agreement. Consequently, that’s another area that needs better definition in the regulations and in the model contracts that will follow.

Q: But when you just take a production sharing agreement or production sharing contract, and if those were to be one of the model contracts that are available for the Iraq government to sign with an oil company, where do you see this being applicable, in the four annexes, and where would it not make sense to do a production sharing agreement, from the government’s standpoint? In Annex 1, would you sign a PSA in Annex 1?

A: The problem is we’re using a set of terms that are designed to apply to a different concept, which is exploration activities and all the types of activities we tend to see for exploration type petroleum activities, and seeking to apply it to an existing, producing resource base.

Q: So you’re saying a PSA is for when exploration is involved.

A: It would be rare to see a production sharing agreement used and granted at a time of, for a field with existing production.

Q: What about for a discovered but not producing field?

A: A discovered but undeveloped field could conceivably be the subject of a production sharing contract if the state decides that that’s the appropriate tool to use.

Q: But there’s far less risk because you know that there’s oil there.

A: The usual kinds of activities under a production sharing contract would need to be suitably revised to suit the development, instead of an exploration and development situation.

--

(e-mail: energy@upi.com)

US air raid in Baghdad kills 10 civilians

How can the US claim that it tries so hard to avoid civilian casualties when it conducts air raids in a city. This is bound to produce civilian casualties. It seems that the US does not care. The same thing happens in Afghanistan. This only turns the populace against the occupying forces.

US air raid in Baghdad kills 10 civiliansArticle from: Agence France-PresseFont September 28, 2007 06:32pm
A US air raid early today killed at least 10 people, including women and children, in a building in a mainly Sunni area of Baghdad, Iraqi officials said.

The raid targeted a building in the Al-Saha neighbourhood in southwestern Baghdad where families were sleeping, the Iraqi officials said.

Bodies were pulled out of the rubble of the building, which was destroyed.

"Ten people were killed and seven wounded when American helicopters attacked Building No 139 at 2am. We have no idea of the reason for the attack," said an Interior Ministry official.

An official at Baghdad's Al-Yarmuk hospital said 13 people - seven men, two women and four children - were killed and 10 men and a women were wounded. He said all the casualties were civilians.

The survivors said their building had been attacked by US helicopters early in the morning, the hospital official said.

There was no immediate comment from the US military.

The reported attack came after the US military said the bodies of five women and four children were found in a central Iraqi village after American soldiers raided houses believed used by al-Qaeda earlier in the week.

A military statement yesterday said a raid by ground and air forces had been carried out on Tuesday on a building in Babahani village near the town of Musayyib, about 50 kilometres south of Baghdad.

"According to Iraqi police, the bodies of five adult women and four children were taken to a local hospital in Musayyib Wednesday," the statement said.

"Structures in the area have historically been found to be used as safe houses for Al-Qaeda," it added.

"Coalition Forces searching a nearby house located (bomb)-making material including command wire, batteries and timers."

Pentagon Gives Blackwater New Contract

I wonder if Blackwater also flies prisoners around to different secret prisons or renders people to outsourced torture sites? Maliki has already discovered he really doesn't have the power to make Blackwater disappear from Iraq. This article talks of Maliki revoking Blackwater's licence. Another article I have read claims that Blackwater never bothered to get a licence from Iraq in the first place! It will be interesting to see what force the new Iraqi legislation on private contractors will have if any.

Pentagon Gives Blackwater New Contract

by Ali Gharib
A U.S.-based private security firm received a contract worth up to 92 million dollars from the Department of Defense amid hard questions about its involvement in two separate violent incidents in Iraq.

"Blackwater has been a contractor in the past with the department and could certainly be in the future," said the U.S.’s top-ranking military officer, General Peter Pace, at an afternoon press conference here.

The future arrived just two hours later when the Pentagon released a new list of contracts – Presidential Airways, the aviation unit of parent company Blackwater, was awarded the contract to fly Department of Defense passengers and cargo between locations around central Asia.

The announcement comes as a cloud of suspicion is gathering around the "professional military" firm for its actions as a State Department security contractor in Iraq in which at least eight Iraqis and possibly as many as 28 were killed, including a woman and child.

Last week, the Iraqi government announced that it had revoked Blackwater's license to operate in the country.

The initial report by the State Department's Bureau of Diplomatic Security on the incident was put together by the U.S. embassy in Baghdad and details of the event where a car bomb exploded near a meeting attended by officials from the U.S. Agency for International Development. Some of the Blackwater team hired as security for the officials was involved in the shootout while apparently trying to clear an evacuation path.

In a statement issued last week, Blackwater USA spokesperson Anne Tyrrell denied any wrongdoing and said that, "Blackwater's independent contractors acted lawfully and appropriately in response to a hostile attack in Baghdad on Sunday. Blackwater regrets any loss of life but this convoy was violently attacked by armed insurgents, not civilians, and our people did their job to defend human life."

However, an official with knowledge of the investigation told the New York Times that the evacuation effort was marked by confusion and chaos – the Blackwater employees believed they were being fired on, but this contradicted the initial Iraqi report on the incident that said there was no enemy fire. There was also apparently an incident of infighting when one guard did not heed a ceasefire call.

In a press conference Wednesday, the deputy press secretary of the State Department gave a non-denial of reports in the press that the Department of Defense has hinted to the State Department that the investigation into Blackwater should be reined in, only highlighting that the departments were working together and that the reports in the press had come from anonymous sources.

Blackwater USA, which has an estimated 1,000 employees in Iraq and 800 million dollars in U.S. government contracts, has been one of the most prominent private security firms operating in the country. Some of its notable assignments have included protecting L. Paul Bremer, the former head of the Coalition Provisional Authority, as well as Crocker, who is currently the leading U.S. diplomatic envoy to Iraq.

The firm came into the public eye in March 2004, when four of its employees were killed and mutilated by an Iraqi mob in Fallujah, the war-torn Iraqi city that was an insurgent stronghold at the time. The incident touched off the unsuccessful U.S. attempt to retake the city in April 2004.

Family members of the four employees slain in Fallujah have since sued Blackwater, alleging that the firm failed to provide necessary equipment and manpower that could have saved the employees' lives.

A separate report by the House Oversight and Government Reform Committee faulted Blackwater’s conduct in the Fallujah incident, in which Blackwater was transporting flatbed trucks when its team was ambushed.

"Blackwater embarked on this mission without sufficient preparation, resources and support for its personnel," concluded the report, saying that the firm had ignored warnings by another security company, cut the staff for the mission by putting rear gunners for both involved security vehicles on administrative duties, and went out with insufficiently armored vehicles.

"Management in North Carolina made the decision to go with soft skin due to the cost" despite the fact that the contract paid for armored vehicles, said a Blackwater employee quoted in the report, referring to Blackwater’s headquarters in Moyock, North Carolina.

The Congressional report noted that the Blackwater men had been sent on their mission without maps and ended up at the wrong military base, where they had to spend the night because of fighting nearby.

Control Risks Group, another security force working in the area at the time, warned Blackwater about the mission after they had twice been offered the same task but "refused both times due to the obvious risk transporting slow-moving loads through such a volatile area."

On the heels of the House Committee report, Congressman David E. Price of North Carolina will introduce legislation next week to extend the reach of U.S. civil courts to include security contractors in Iraq. The proposed bill, H.R. 2740, will also establish F.B.I. investigative units in the war zone charged with investigating allegations of misconduct.

In a letter to U.S. Secretary of State Condoleezza Rice last week, Price wrote, "The allegations related to the Sept. 16 incident have the potential to become a flashpoint in terms of Iraqi antagonism toward U.S. personnel, with wide-ranging implications for our mission and our troops. There is no question that the lack of clarity surrounding the legal options for prosecuting criminal acts has significantly undermined our efforts in Iraq."

The various investigations into security contractors working for the U.S. government in Iraq and related legislation are heralded by critics of the Bush administration’s approach to the war, pointing to the failures of the so-called [Donald] Rumsfeld doctrine, which promotes a more streamlined and greatly privatized military based on an "entrepreneurial approach" and raising questions about rampant war-profiteering.

Bleakonomics

I have not had a chance to read Klein's book yet but this review seems more positive than some other recent reviews I have read. Some reviewers are quite upset and dismissive of Klein's views. However, Stiglitz is much more even handed perhaps because he himself of late has been also critical of the prevalent "theology" of free markets.
As I have mentioned in another post, Friedman's role is perhaps overemphasized although he was directly involved in Chile as an advisor to Pinochet. In Russia the shock was delivered more by a Harvard School featuring the likes of Jeffrey Sachs who not only delivered a privatisation shock but made themselves in some of the deals it would seem.
Stiglitz's term "bleakonomics" is a great neologism.

Bleakonomics


By JOSEPH E. STIGLITZ
Published: September 30, 2007
There are no accidents in the world as seen by Naomi Klein. The destruction of New Orleans by Hurricane Katrina expelled many poor black residents and allowed most of the city’s public schools to be replaced by privately run charter schools. The torture and killings under Gen. Augusto Pinochet in Chile and during Argentina’s military dictatorship were a way of breaking down resistance to the free market. The instability in Poland and Russia after the collapse of Communism and in Bolivia after the hyperinflation of the 1980s allowed the governments there to foist unpopular economic “shock therapy” on a resistant population. And then there is “Washington’s game plan for Iraq”: “Shock and terrorize the entire country, deliberately ruin its infrastructure, do nothing while its culture and history are ransacked, then make it all O.K. with an unlimited supply of cheap household appliances and imported junk food,” not to mention a strong stock market and private sector.

THE SHOCK DOCTRINE

The Rise of Disaster Capitalism.

By Naomi Klein.

558 pp. Metropolitan Books. $28.


Free-Market Mischief in Hot Spots of Disaster (September 10, 2007) “The Shock Doctrine” is Klein’s ambitious look at the economic history of the last 50 years and the rise of free-market fundamentalism around the world. “Disaster capitalism,” as she calls it, is a violent system that sometimes requires terror to do its job. Like Pol Pot proclaiming that Cambodia under the Khmer Rouge was in Year Zero, extreme capitalism loves a blank slate, often finding its opening after crises or “shocks.” For example, Klein argues, the Asian crisis of 1997 paved the way for the International Monetary Fund to establish programs in the region and for a sell-off of many state-owned enterprises to Western banks and multinationals. The 2004 tsunami enabled the government of Sri Lanka to force the fishermen off beachfront property so it could be sold to hotel developers. The destruction of 9/11 allowed George W. Bush to launch a war aimed at producing a free-market Iraq.

In an early chapter, Klein compares radical capitalist economic policy to shock therapy administered by psychiatrists. She interviews Gail Kastner, a victim of covert C.I.A. experiments in interrogation techniques that were carried out by the scientist Ewen Cameron in the 1950s. His idea was to use electroshock therapy to break down patients. Once “complete depatterning” had been achieved, the patients could be reprogrammed. But after breaking down his “patients,” Cameron was never able to build them back up again. The connection with a rogue C.I.A. scientist is overdramatic and unconvincing, but for Klein the larger lessons are clear: “Countries are shocked — by wars, terror attacks, coups d’état and natural disasters.” Then “they are shocked again — by corporations and politicians who exploit the fear and disorientation of this first shock to push through economic shock therapy.” People who “dare to resist” are shocked for a third time, “by police, soldiers and prison interrogators.”

In another introductory chapter, Klein offers an account of Milton Friedman — she calls him “the other doctor shock” — and his battle for the hearts and minds of Latin American economists and economies. In the 1950s, as Cameron was conducting his experiments, the Chicago School was developing the ideas that would eclipse the theories of Raul Prebisch, an advocate of what today would be called the third way, and of other economists fashionable in Latin America at the time. She quotes the Chilean economist Orlando Letelier on the “inner harmony” between the terror of the Pinochet regime and its free-market policies. Letelier said that Milton Friedman shared responsibility for the regime’s crimes, rejecting his argument that he was only offering “technical” advice. Letelier was killed in 1976 by a car bomb planted in Washington by Pinochet’s secret police. For Klein, he was another victim of the “Chicago Boys” who wanted to impose free-market capitalism on the region. “In the Southern Cone, where contemporary capitalism was born, the ‘war on terror’ was a war against all obstacles to the new order,” she writes.

One of the world’s most famous antiglobalization activists and the author of the best seller “No Logo: Taking Aim at the Brand Bullies,” Klein provides a rich description of the political machinations required to force unsavory economic policies on resisting countries, and of the human toll. She paints a disturbing portrait of hubris, not only on the part of Friedman but also of those who adopted his doctrines, sometimes to pursue more corporatist objectives. It is striking to be reminded how many of the people involved in the Iraq war were involved earlier in other shameful episodes in United States foreign policy history. She draws a clear line from the torture in Latin America in the 1970s to that at Abu Ghraib and Guantánamo Bay.

Klein is not an academic and cannot be judged as one. There are many places in her book where she oversimplifies. But Friedman and the other shock therapists were also guilty of oversimplification, basing their belief in the perfection of market economies on models that assumed perfect information, perfect competition, perfect risk markets. Indeed, the case against these policies is even stronger than the one Klein makes. They were never based on solid empirical and theoretical foundations, and even as many of these policies were being pushed, academic economists were explaining the limitations of markets — for instance, whenever information is imperfect, which is to say always.

Klein isn’t an economist but a journalist, and she travels the world to find out firsthand what really happened on the ground during the privatization of Iraq, the aftermath of the Asian tsunami, the continuing Polish transition to capitalism and the years after the African National Congress took power in South Africa, when it failed to pursue the redistributionist policies enshrined in the Freedom Charter, its statement of core principles. These chapters are the least exciting parts of the book, but they are also the most convincing. In the case of South Africa, she interviews activists and others, only to find there is no one answer. Busy trying to stave off civil war in the early years after the end of apartheid, the A.N.C. didn’t fully understand how important economic policy was. Afraid of scaring off foreign investors, it took the advice of the I.M.F. and the World Bank and instituted a policy of privatization, spending cutbacks, labor flexibility and so on. This didn’t stop two of South Africa’s own major companies, South African Breweries and Anglo-American, from relocating their global headquarters to London. The average growth rate has been a disappointing 5 percent (much lower than in countries in East Asia, which followed a different route); unemployment for the black majority is 48 percent; and the number of people living on less than $1 a day has doubled to four million from two million since 1994, the year the A.N.C. took over.

Some readers may see Klein’s findings as evidence of a giant conspiracy, a conclusion she explicitly disavows. It’s not the conspiracies that wreck the world but the series of wrong turns, failed policies, and little and big unfairnesses that add up. Still, those decisions are guided by larger mind-sets. Market fundamentalists never really appreciated the institutions required to make an economy function well, let alone the broader social fabric that civilizations require to prosper and flourish. Klein ends on a hopeful note, describing nongovernmental organizations and activists around the world who are trying to make a difference. After 500 pages of “The Shock Doctrine,” it’s clear they have their work cut out for them.

Joseph E. Stiglitz, a university professor at Columbia, was awarded the Nobel in economic science in 2001. His latest book is “Making Globalization Work.”

»

We'll revoke Al-Maliki's Licence First

One wonders if an American actually said this. Given US insensitivity it is possible. I was not aware of some of the other incidents with Blackwater that are listed here. They do not get much play in the western media. We will see what if anything happens as the result of the joint investigation. The Iraqi govt. is already drawing up a law that will hold contractors responsible. I wonder what the US response will be. It is unlikely that they will fire Blackwater for sure.

This is from the following site.

'We'll revoke Al-Maliki's licence first'
The privatisation of security in Iraq threatens more than innocent civilians, reports Nermeen Al-Mufti

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The killing of 11 civilians in Baghdad two weeks ago has once again put Blackwater on the spot. The US security firm first came into the public eye in early April 2004, when four of its personnel were killed and mutilated by mobs in Falluja. Although Iraqi religious parties denounced the attacks at the time, Bush gave the town four days to deliver the perpetrators before ordering an all-out attack, one in which thousands of Falluja inhabitants perished.

The Iraqi government would like to see Blackwater brought to account. But that is not going to be easy. The spokesman for the Iraqi Interior Ministry, Abdul-Karim Khalif, says that the ministry provided Iraqi courts with evidence against Blackwater concerning other shootings over the past seven months. In one shooting last February, three of the guards of Al-Iraqiya television were killed. On 9 September, five Iraqis were killed when Blackwater personnel fired at them near the municipality building in Baghdad. Three days later, five other citizens were wounded in another shooting on Palestine Street. Blackwater, the Iraqi Interior Ministry maintains, is also involved in the killing of an Iraqi journalist near the Iraqi Foreign Ministry building in Baghdad in February, as well as the killing of a citizen near the Iraqi Interior Ministry building in Baghdad in May.

"Most of the laws passed by Paul Bremer, the civilian administrator of Iraq under US occupation, remain in force. Some of these laws violate Iraqi sovereignty, including a law that prevents Iraqis from prosecuting any American or any individual who cooperates with America or the coalition authorities, whether civilian or military," Abu Abdullah, an Iraqi lawyer, told Al-Ahram Weekly.

Following the recent incident in Baghdad, Prime Minister Nuri Al-Maliki threatened to revoke Blackwater's licence. What he later discovered was that the company was working in Iraq without a licence. The Americans weren't impressed by Al-Maliki's uncharacteristic boldness. "We'll revoke Al-Maliki's licence before he revokes Blackwater's licence," a US official quipped.

Within four days of the incident, Blackwater was back in operation. A spokesman for Operation Imposing Law said that the services of private contractors in Iraq cannot be discontinued without creating a security vacuum. According to media reports, the Iraqis and Americans have formed an eight-member committee to investigate the Blackwater incident. The committee is co-chaired by a top US diplomat and the Iraqi defence minister.

Blackwater has over 20,000 personnel in Iraq, all well- armed and backed with armoured vehicles and aircraft. The company has military equipment comparable to that used by the US army and its pilots fly reconnaissance missions over Baghdad on a daily basis. Last April, one of its helicopters was shot down during clashes in Al-Fadl district of Baghdad.

According to press reports, about 34 per cent of the budget the US government initially allocated for the reconstruction of Iraq has been diverted to private security firms. The "privatisation" of the war in Iraq is well underway, The Los Angeles Times reported. In his book, Blackwater: The Rise of the World's Most Powerful Mercenary Army, American investigative journalist Jeremy Scahill links the modern security firm to the Knights of Malta, an offshoot of the Knights Templar. Blackwater's employees, he argues, share the same religious zeal of ancient crusaders.

"Private security companies -- whether American, British, or South African -- do not differ much from Iraq's sectarian militias. These companies act as if they were entitled to commit any crime on the pretext of self-defence," Abu Abdullah said. US federal authorities are currently investigating the involvement of Blackwater employees in smuggling weapons into Iraq.

Meanwhile, US airborne troops shot dead seven Iraqi civilians in the predominantly Sunni town of Al-Mahmoudiya, 20km south of Baghdad. Little else is known about the operation. But US authorities regularly claim that such attacks are part of their offensive against Al-Qaeda. Similar operations take place in Sadr City frequently, the target in that case being the Mahdi Army

Lost in Translation: Ahmadinejad And the Media

This is an excellent article in that it enables one to make sense of what seem senseless statements. I took Ahmadinejad to be actually refusing to admit there were gays in Iran. This interpretation makes much more sense.
I had already realised the "wiping Israel off the map" statement was misconstrued. Of course the most extreme interpretations of Ahmadinejad on Israel are so established in the US media and the US psyche that articles such as this which do not get much coverage anyway will have nil effect.


Lost In Translation: Ahmadinejad And The Media

By Ali Quli Qarai

09/28/07 "ICH" -- - First I want to make some remarks about that now world-famous statement of President Ahmadinejad at Columbia: “We do not have homosexuals in Iran of the kind you have in your country.” The American media conveniently ignored the second, and crucial, part of his sentence as something redundant.

Obviously he was not saying, We don’t have any homosexuals whatsoever in Iran—something nobody in the world would believe, not even in Iran. And by implication, he was not telling his audience, I am a plain liar! —something which his audience at Columbia and the American media construed him to be saying.

What he was saying is that homosexuality in the US and homosexuality in Iran are issues which are as far apart from one another as two cultural universes possibly can be. They are so dissimilar that any attempt to relate them and bring them under a common caption would be misleading. “Homosexuality is not an issue in Iran as it is in present-day American society.” This was, apparently what was saying in polite terms.

Homosexuality in the US is a omnipresent social and political issue which crops up in almost every discourse and debate pertaining to American society and politics. So much so that I think it was a major issue, if not the deciding factor, in the last two presidential elections which paved Bush’s way to the White House and saddled the Democrats with defeat, because a large so-called conservative section of the American public (the red states) felt wary of the pro-gay liberalism of the Democratic Party.

By contrast, homosexuality is a non-issue in Iran and is considered an uncommon perversion (except as an occasional topic of jokes about a certain town). Prom the viewpoint of penal law, too, it is does not receive much attention as the requirements for a sentence (four eye-witnesses, who have actually seen the details of the act) are so astringent as to make punishment almost impossible. (It would be interesting to know how many have been accused of it during the last two decades)

By contrast adultery and homosexuality are legalized forms of behaviour in most of Europe and America, and regarded not as criminal acts but as perfectly acceptable forms of sexual behaviour and as legitimate natural human rights which need to be taught even to all Asian and African societies as well.

There was also a subtle hint in his remark that he wanted to move on from this topic to more serious and relevant matters, a point which would be obvious to anyone conversant with Persian language and culture (like his another hint concerning the disgraceful conduct of Columbia president, when, while formally inviting Columbia academics to Iran, he added that “You can rest assured that we will treat you in Iran with hundred percent respect.”

Iranians, being linguistically a very sophisticated people, speak a lot in hints which are invisible to outsiders. Americans in comparison tend to be straightforward and often as primitive.

(In general the Persians, like other civilized societies, have developed the art of making and responding to harsh remarks in soft and friendly words. Americans, as Prof. Bollinger proved, have still much to learn from civilized nations concerning the civilities of civilized hostility.)

Mr Bollinger’s hostility towards President Ahmadinejad had obviously been fed by devious translations and interpretations of his earlier—also world-famous—remarks about Israel and the Holocaust. As if, as one commentator has remarked, the professor had been watching only CNN and Fox News.

· Unfortunately for more than an year these remarks have given a ready-made excuse to his critics to demonize him and attack Iran’s foreign policies. Although he has made some attempts (unjustifiably belated, I think, and not quite adequate) to clarify himself, we who hear these remarks have also an intellectual duty to ourselves and others to see exactly what he exactly meant.

It is a basic linguistic principle of civilized discourse that so long as there is an acceptable and upright interpretation for someone’s remark, it should not be given a devious meaning. Moreover, as one of my teachers often says, it is easy to reject and denounce the statements of others, but the worthy task of every intelligent seeker is to try to understand people who hold different opinions. This is particular necessary when such statements originate in a different linguistic and cultural domain.

When Ahmadinejad repeated Ayatullah Khomeini’s words that “Israel baayad az bayn beravad,” (which literally means that Israel should cease to exist), what is critically important for understanding is to see how Iranian people understand these words of their president. I don’t think any mature Iranian with some awareness of regional politics has ever thought that the late Leader of Iran, or the present president of the country, were advocating some kind of military objectives against Israel. By citing the example of the Soviet Union and the Apartheid regime in South Africa Ahmadinejad, too, has clarified what he meant by ‘Israel ceasing to exist.’ By the rules of civilized discourse, every speaker’s clarification concerning what he means is authoritative as he is entitled, before all others, to state and clarify what he means by his statements. In this case, Ahmadinejad has also clarified as to how he thinks that my happen: a general referendum in undivided Palestine with the participation of its Arab, Jewish and Christian population.

As for his statement that the Holocaust in a myth, we all know that the word “myth” has several meanings in the dictionary. One of its meanings is “A fiction or half-truth, especially one that forms part of an ideology” (The American Heritage Dictionary of the English Language). Thus a myth is not something necessarily untrue and Ahmadinejad has not denied outright that the Holocaust did occur, although he seems to have—what he considers to be legitimate—doubts about its exact extent, doubts which are prone to be strengthened, rightly or otherwise, by attempts to persecute or prosecute scholars whose research leads them to conclusions different from main-current historiography. What he basically appears to question is that the Holocaust should be made an ideological tool for the pursuit of unfair and inhuman objectives—something which most of us acknowledge has happened in the case of Palestine. Why should the people of Palestine be made to pay the price for the guilt and failings of Europe? He asks. I think that is a legitimate question.

The savants of the media are free to interpret Ahmadinejad’s statement with the purpose of demonizing him and excoriating Iran, but there are better and alternate paths for those who strive for understanding and peace between nations, and to an objective like this should institutions like universities, including Columbia, contribute.

I hope that Mr Bollinger will advance a courageous apology to Mr Ahmadinejad and take advantage of his standing invitation for continuing the exchange of ideas with academic circles in Iran. Iranians generally are a large hearted people, like most Americans, and I hope the bitterness which has arisen from the unfortunate event of the past week will soon be forgotten with the sincere efforts of well-meaning intellectuals and officials on both sides. I cannot think of any other way in which good will between these nations as well as the good repute of an outstanding institution of higher learning such as Columbia can be salvaged.

Ali Quli Qarai is an Iranian scholar. He has published several books, including a translation of the Quran. He can be reached at altwhid@gmail.com

Dilip Hero: The Bush Oil Grab

If anyone doubts that to a considerable degree the US invasion of Iraq was about oil here is an excellent history that gives lots of evidence that it was. It seems that in the US even many leftists think that oil was really not a significant factor that oil control could have been obtained other ways etc. The Iraqis themselves have a more realistic assessment IMHO! The material comes from this site.


How the Bush Administration's Iraqi Oil Grab Went Awry

by Dilip Hiro

Here is the sentence in The Age of Turbulence, the 531-page memoir of former Federal Reserve chief Alan Greenspan, that caused so much turbulence in Washington last week: "I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil." Honest and accurate, it had the resonance of the Bill Clinton's election campaign mantra, "It's the economy, stupid." But, finding himself the target of a White House attack – an administration spokesman labeled his comment, "Georgetown cocktail party analysis" – Greenspan backtracked under cover of verbose elaboration. None of this, however, made an iota of difference to the facts on the ground.

Here is a prosecutor's brief for the position that "the Iraq War is largely about oil":

The primary evidence indicating that the Bush administration coveted Iraqi oil from the start comes from two diverse but impeccably reliable sources: Paul O'Neill, the Treasury Secretary (2001-2003) under President George W. Bush; and Falah Al Jibury, a well-connected Iraqi-American oil consultant, who had acted as President Ronald Reagan's "back channel" to Iraqi President Saddam Hussein during the Iraq-Iran War of 1980-88. The secondary evidence is from the material that can be found in such publications as the New York Times and the Wall Street Journal.

According to O'Neill's memoirs, The Price of Loyalty: George W. Bush, the White House, and the Education of Paul O'Neill, written by journalist Ron Suskind and published in 2004, the top item on the agenda of the National Security Council's first meeting after Bush entered the Oval Office was Iraq. That was Jan. 30, 2001, more than seven months before the 9/11 attacks. The next National Security Council (NSC) meeting on Feb. 1 was devoted exclusively to Iraq.

Advocating "going after Saddam" during the Jan. 30 meeting, Defense Secretary Donald Rumsfeld said, according to O'Neill, "Imagine what the region would look like without Saddam and with a regime that's aligned with U.S. interests. It would change everything in the region and beyond. It would demonstrate what U.S. policy is all about." He then discussed post-Saddam Iraq – the Kurds in the north, the oil fields, and the reconstruction of the country's economy. (Suskind, p. 85)

Among the relevant documents later sent to NSC members, including O'Neill, was one prepared by the Defense Intelligence Agency (DIA). It had already mapped Iraq's oil fields and exploration areas, and listed American corporations likely to be interested in participating in Iraq's petroleum industry.

Another DIA document in the package, entitled "Foreign Suitors for Iraqi Oilfield Contracts," listed companies from 30 countries – France, Germany, Russia, and Britain, among others – their specialties and bidding histories. The attached maps pinpointed "super-giant oil field," "other oil field," and "earmarked for production sharing," and divided the basically undeveloped but oil-rich southwest of Iraq into nine blocks, indicating promising areas for future exploration. (Suskind, p. 96)

According to high-flying oil insider Falah Al Jibury, the Bush administration began making plans for Iraq's oil industry "within weeks" of Bush taking office in January 2001. In an interview with the BBC's Newsnight program, which aired on March 17, 2005, he referred to his participation in secret meetings in California, Washington, and the Middle East, where, among other things, he interviewed possible successors to Saddam Hussein.

By January 2003, a plan for Iraqi oil crafted by the State Department and oil majors emerged under the guidance of Amy Myers Jaffe of the James A. Baker III Institute for Public Policy at Rice University. It recommended maintaining the state-owned Iraq National Oil Company, whose origins dated back to 1961 – but open it up to foreign investment after an initial period in which U.S.-approved Iraqi managers would supervise the rehabilitation of the war-damaged oil infrastructure. The existence of this group would come to light in a report by the Wall Street Journal on March 3, 2003.

Unknown to the architects of this scheme, according to the same BBC Newsnight report, the Pentagon's planners, apparently influenced by powerful neocons in and out of the administration, had devised their own super-secret plan. It involved the sale of all Iraqi oil fields to private companies with a view to increasing output well above the quota set by the Organization of the Petroleum Exporting Countries (OPEC) for Iraq in order to weaken, and then destroy, OPEC.

Secondary Evidence

On Oct. 11, 2002 the New York Times reported that the Pentagon already had plans to occupy and control Iraq's oilfields. The next day the Economist described how Americans in the know had dubbed the waterway demarcating the southern borders of Iraq and Iran "Klondike on the Shatt al-Arab," while Ahmed Chalabi, head of the U.S.-funded Iraqi National Congress and a neocon favorite, had already delivered this message: "American companies will have a big shot at Iraqi oil – if he gets to run the show."

On Oct. 30, Oil and Gas International revealed that the Bush administration wanted a working group of 12 to 20 people to (a) recommend ways to rehabilitate the Iraqi oil industry "in order to increase oil exports to partially pay for a possible U.S. military occupation government," (b) consider Iraq's continued membership of OPEC, and (c) consider whether to honor contracts Saddam Hussein had granted to non-American oil companies.

By late October 2002, columnist Maureen Dowd of the New York Times would later reveal, Halliburton, the energy services company previously headed by Vice President Dick Cheney, had prepared a confidential 500-page document on how to handle Iraq's oil industry after an invasion and occupation of Iraq. This was, commented Dowd, "a plan [Halliburton] wrote several months before the invasion of Iraq, and before it got a no-bid contract to implement the plan (and overbill the U.S.)." She also pointed out that a Times' request for a copy of the plan evinced a distinct lack of response from the Pentagon.

In public, of course, the Bush administration built its case for an invasion of Iraq without referring to that country's oil or the fact that it had the third largest reserves of petroleum in the world. But what happened out of sight was another matter. At a secret NSC briefing for the president on February 24, 2003, entitled, "Planning for the Iraqi Petroleum Infrastructure," a State Department economist, Pamela Quanrud, told Bush that it would cost $7-8 billion to rebuild the oil infrastructure, if Saddam decided to blow up his country's oil wells, according to Washington Post reporter Bob Woodward in his 2004 book, Plan of Attack (pp. 322-323). Quanrud was evidently a member of the State Department group chaired by Amy Myers Jaffe.

When the Anglo-American troops invaded on March 20, 2003, they expected to see oil wells ablaze. Saddam Hussein proved them wrong. Being a staunch nationalist, he evidently did not want to go down in history as the man who damaged Iraq's most precious natural resource.

On entering Baghdad on April 9, the American troops stood by as looters burned and ransacked public buildings, including government ministries – except for the Oil Ministry, which they guarded diligently. Within the next few days, at a secret meeting in London, the Pentagon's scheme of the sale of all Iraqi oil fields got a go-ahead in principle.

The Bush administration's assertions that oil was not a prime reason for invading Iraq did not fool Iraqis though. A July 2003 poll of Baghdad residents – who represented a quarter of the Iraqi national population – by the London Spectator showed that while 23 percent believed the reason for the Anglo-American war on Iraq was "to liberate us from dictatorship," twice as many responded, "to get oil." (Cited in Dilip Hiro, Secrets and Lies: Operation "Iraqi Freedom" and After, p. 398.)

As Iraq's principal occupier, the Bush White House made no secret of its plans to quickly dismantle that country's strong public sector. When the first American proconsul, retired Gen. Jay Garner, focused on holding local elections rather than privatizing the country's economic structure, he was promptly sacked.

Hurdles to Oil Privatization Prove Impassable

Garner's successor, L. Paul Bremer III, found himself dealing with Philip Carroll – former chief executive officer of the American operations of (Anglo-Dutch) Royal Dutch Shell in Houston – appointed by Washington as the Iraqi oil industry's supreme boss. Carroll decided not to tinker with the industry's ownership and told Bremer so. "There was to be no privatization of Iraqi oil resources or facilities while I was involved," Carroll said in an interview with the BBC's Newsnight program on March 17, 2005.

This was, however, but a partial explanation for why Bremer excluded the oil industry when issuing Order 39 in September 2003 privatizing nearly 200 Iraqi public sector companies and opening them up to 100 percent foreign ownership. The Bush White House had also realized by then that denationalizing the oil industry would be a blatant violation of the Geneva Conventions which bar an occupying power from altering the fundamental structure of the occupied territory's economy.

There was, as well, the vexatious problem of sorting out the 30 major oil development contracts Saddam's regime had signed with companies based in Canada, China, France, India, Italy, Russia, Spain, and Vietnam. The key unresolved issue was whether these firms had signed contracts with the government of Saddam Hussein, which no longer existed, or with the Republic of Iraq which remained intact.

Perhaps more important was the stand taken by Grand Ayatollah Ali Sistani, the senior Shi'ite cleric in the country and a figure whom the occupying Americans were keen not to alienate. He made no secret of his disapproval of the wholesale privatization of Iraq's major companies. As for the minerals – oil being the most precious – Sistani declared that they belonged to the "community," meaning the state. As a religious decree issued by a grand ayatollah, his statement carried immense weight.

Even more effective was the violent reaction of the industry's employees to the rumors of privatization. In his Newsnight interview Jibury said, "We saw an increase in the bombing of oil facilities and pipelines built on the premise that privatization is coming."

In the immediate aftermath of the invasion, much equipment was looted from pipelines, pumping stations, and other oil facilities. By August 2003, four months after American troops entered Baghdad, oil output had only inched up to 1.2 million barrels per day, about two-fifths of the pre-invasion level. The forecasts (or dreams) of American planners' that oil production would jump to 6 million barrels per day by 2010 and easily fund the occupation and reconstruction of the country, were now seen for what they were – part of the hype disseminated privately by American neocons to sell the idea of invading Iraq to the public.

With the insurgency taking off, attacks on oil pipelines and pumping stations averaged two a week during the second half of 2003. The pipeline connecting a major northern oil field near Kirkuk – with an export capacity of 550,000-700,000 barrels per day – to the Turkish port of Ceyhan became inoperative. Soon, the only oil being exported was from fields in the less disturbed, predominately Shi'ite south of Iraq.

In September 2003, President Bush approached Congress for $2.1 billion to safeguard and rehabilitate Iraq's oil facilities. The resulting Task Force Shield project undertook to protect 340 key installations and 4,000 miles (6,400 km) of oil pipeline. It was not until the spring of 2004 that output again reached the prewar average of 2.5 million barrels per day – and that did not hold. Soon enough, production fell again. Iraqi refineries were, by now, producing only two-fifths of the 24 million liters of gasoline needed by the country daily, and so there were often days-long lines at service stations.

Addressing the 26th Oil and Money conference in London on Sept. 21, 2005, Issam Chalabi, who had been an Iraqi oil minister in the late 1980s, referred to the crippling lack of security and the lack of clear laws to manage the industry, and doubted if Iraq could return to the 1979 peak of 3.5 million barrels per day before 2009, if then.

Meanwhile, the Iraqi government found itself dependent on oil revenues for 90 percent of its income, a record at a time when corruption in its ministries had become rampant. On Jan. 30, 2005, Stuart W. Bowen, the special inspector general appointed by the U.S. occupation authority, reported that almost $9 billion in Iraqi oil revenue, disbursed to the ministries, had gone missing. A subsequent congressional inspection team reported in May 2006 that Task Force Shield had failed to meet its goals due to "lack of clear management structure and poor accountability," and added that there were "indications of potential fraud" which were being reviewed by the inspector general.

The endorsement of the new Iraqi constitution by referendum in October 2005 finally killed the prospect of full-scale oil privatization. Article 109 of that document stated clearly that hydrocarbons were "national Iraqi property." That is, oil and gas would remain in the public sector.

In March 2006, three years after the Anglo-American invasion of Iraq, the country's petroleum exports were 30-40 percent below pre-invasion levels.

Bush Pushes for Iraq's Flawed Draft Hydrocarbon Law

In February 2007, in line with the constitution, the draft hydrocarbon law the Iraqi government presented to parliament kept oil and gas in the state sector. It also stipulated recreating a single Iraqi National Oil Company that would be charged with doling out oil income to the provinces on a per-capita basis. The Bush administration latched onto that provision to hype the 43-article Iraqi bill as a key to reconciliation between Sunnis and Shi'ites – since the Sunni areas of Iraq lack hydrocarbons – and so included it (as did Congress) in its list of "benchmarks" the Iraqi government had to meet.

Overlooked by Washington was the way that particular article, after mentioning revenue-sharing, stated that a separate Federal Revenue Law would be necessary to settle the matter of distribution – the first draft of which was only published four months later in June.

Far more than revenue sharing and reconciliation, though, what really interested the Bush White House were the mouthwatering incentives for foreign firms to invest in Iraq's hydrocarbon industry contained in the draft law. They promised to provide ample opportunities to America's Oil Majors to reap handsome profits in an oil-rich Iraq whose vast western desert had yet to be explored fully for hydrocarbons. So Bush pressured the Iraqi government to get the necessary law passed before the parliament's vacation in August – to no avail.

The Bush administration's failure to achieve its short-term objectives does not detract from the overarching fact – established by the copious evidence marshaled in this article – that gaining privileged access to Iraqi oil for American companies was a primary objective of the Pentagon's invasion of Iraq.

Dilip Hiro is the author of Secrets and Lies: Operation "Iraqi Freedom" and After, as well as, most recently, Blood of the Earth: The Battle for the World's Vanishing Oil Resources, both published by Nation Books.

Copyright 2007 Dilip Hiro


Digg this!

Iraq in talks with oil majors

Earthtimes.org

--------------------------------------------------------------------------------
A glimpse of what is going on behind the scenes and out of the mainstream press it seems. This is from earthtimies.
Iraq in talks with oil majors for plans
Posted on : 2007-09-27 | Author : General News Editor
News Category : World


BAGHDAD, Sept. 27 (UPI) Iraq's government is discussing oil field development with global oil majors as it attempts to boost production amidst security concerns.

Iraq produces about 2 million barrels per day now, but the vast oil sector needs billions in investment to fix and modernize the operating infrastructure, let alone develop and explore.

Iraq Oil Minister Hussain al-Shahristani said earlier this month in Dubai his government would move forward on signing oil deals despite the lack of a modern oil law. That law is stuck in parliamentary debate. Shahristani would rely on 1980s legislation to dictate deals.

The Christian Science Monitor reports Chevron is in talks with Iraq to develop in the south of the country; Shell for fields in Kirkuk; Japex for east Baghdad fields; Ivanov, the Russian firm, in northwest Iraq; and ConocoPhillips has teamed with the state-run Northern Oil Co. for the Kirkuk area.

The five-year plan for Iraq is to boost production to more than 6 million barrels per day, exporting 5.2 million. Iraq imports much of its fuels but is looking to build new refineries to meet domestic demand.

Iraq exports about 1.6 million bpd now, nearly all from ports in Basra, in the south. The main pipeline in the north, from Kirkuk to Ceyhan, Turkey, has been attacked so often it is largely irrelevant. Security patrols along the pipeline have been stepped up and $30 million worth of fortification projects are to be finished in March, the Monitor reports.

The added protection wasn't enough to keep a bomb from exploding under the pipeline between Kirkuk and Baiji, Iraq, last week, halting the limited exports that had been flowing for a few weeks.

Copyright 2007 by United Press International





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A Conservative Historian on the Iraq war.

This is from the American Conservative
I have included just part of the article. The whole article is well worth reading. Even though it is a conservative viewpoint it is well argued, rational, and has much more light than heat considering the subject matter Open Fire! On this I agree comletely and couldn't say it better myself:
It lets Americans scapegoat the Iraqis for results for which they were not primarily responsible. The fact is that the U.S. destroyed the former Iraqi governmental apparatus and created a new government under conditions that virtually guaranteed that it would be dysfunctional. It broke the Iraqis’ legs and now complains because they cannot jump the high hurdles.

September 24, 2007 Issue
Copyright © 2007 The American Conservative



Open Fire


The U.S. needlessly inflamed Iraq in the vain hope of sparking a democratic revolution. We got an inferno instead.

by Paul W. Schroeder

I write as an historian, offering no special expertise on current American politics or the military and political situation in Iraq and promising no new facts or ideas. Trying to say something original about the Iraq imbroglio is like trying to invent new letters for the alphabet—impossible and pointless. I propose instead to present familiar facts in another way, believing that sometimes ideas, individually well known and in the mainstream, in different combination suggest an unexpected conclusion.

I also assume that history counts, that the prevalent American historical perspectives on this war are inadequate and misleading, and that a sounder sense of history can not only free us from the tyranny of misleading historical analogies but also suggest different and better ones. While the past does not predict the future, and no historian should pretend to be a prophet, one indispensable way to look into the future is to walk carefully back into the past.

That means starting with recent history, inquiring how six years of global war on terror and five years of regular and counterinsurgency war in Iraq leave the U.S. now facing two apparently unquenchable fires of insurgency, terrorism, and civil war—fires that threaten the entire Middle East and adjacent areas, including Pakistan, as well as South Asia, Central Asia, Europe, and North Africa. While taking note of American intentions, aims, motives, and agendas—declared and undeclared—and the debates over these, I will concentrate, as historians should, more on what the American government actually did in its supposed efforts to prevent and then fight these fires, what its actions objectively constituted within the international system, and what results they produced. In history, especially in international affairs, results count more than intentions, and the most important results are very often the ironic, unintended ones.

Preventing the Fire

Two major facts must be recognized at the outset: the fire in Iraq (though not Afghanistan) could have been prevented, and the American government deliberately decided against doing so. These are not controversial assertions but undeniable facts. Other questions about preventing fires at this time remain debatable—whether the attacks of 9/11 might have been averted or blunted by better intelligence and quicker action, whether the Clinton administration could have weakened al-Qaeda earlier, whether a more determined campaign in Afghanistan could have destroyed al-Qaeda and prevented further terrorism. But this much is certain: first, the Bush administration, supported by most of the Congress and the American people, decided to treat an alleged potential threat of explosion emanating from Iraq as more imminent and dangerous than the actual fire burning in Afghanistan, Pakistan, and elsewhere; and second, it chose against resistance at home and widespread opposition from the international community not to use existing, standard methods of fire prevention.

Much of this—the priority the U.S. gave Iraq over Afghanistan and al-Qaeda and the choice of preventive war—is universally acknowledged. Astonishingly, however, the equally important and undeniable fact that its policy in 2002-03 deliberately rejected international methods for fire prevention in Iraq has still not been squarely faced, much less accepted. This gets ignored or swept aside by disputes over other questions, arguably interesting and important but not central—Saddam Hussein’s nature and intentions, Iraq’s capabilities, the existence or not of WMD, the motives and aims of America’s leaders, the quality and use of American intelligence, the genuine or deceptive character of arguments for military action, and so on.

This shell game, whether it represents a deliberate tactic or not, has led Americans to misunderstand the struggle at the UN that culminated in America’s failure to gain a Security Council resolution authorizing the use of force against Iraq and its decision to proceed without one. The American public has been led to believe that the sole, decisive issue was whether Iraq possessed WMD or active programs to develop them. If so, military action would have automatically been justified and needed. This remains the administration’s defense of the decision for preventive war: along with other countries and on the basis of reasonable intelligence, it genuinely considered Saddam’s weapons a threat to which the only effective response was force.

That completely distorts the debate. It was not simply over whether Saddam possessed WMD and/or active weapons programs, with everyone agreeing that military action was required if he did. The contest was over two distinct questions. The first was about facts and evidence. Had Iraq’s weapons and programs already been sufficiently proved (the American position), or should the UN arms inspectors led by Hans Blix be given more time to make sure? The second, even more important from the standpoint of international politics and law, was about the best response. If the threat proved real, should the international community immediately authorize military action or first expand the existing UN-authorized sanctions against Iraq to try to force Saddam to surrender his weapons and submit to international controls?

The choice therefore lay between the American position that the threat was already proved, that other methods would take too long and be ineffective, and that only military action could deal with it, and the arguments of others, led by France, for more time to make sure of the threat and, should it prove real, for using standard methods and instruments of containment, deterrence, and coercive diplomacy before resorting to military action. In other words, it was a choice between starting a fire in the Middle East to counter one allegedly already smoldering and about to break out and trying fire prevention first.

On both scores, the American position proved wrong and its opponents’ right—and once again Americans have largely missed the significance of this. The failure to find any evidence of WMD or active programs after conquering and occupying Iraq is not, as is constantly supposed, important chiefly because it undermines the official rationale and justification for the war and shows that the administration manipulated prewar intelligence in order to deceive the American people. Whether or not those charges are true is not the real issue. The inability to locate WMD proved precisely what opponents of war had earlier contended: traditional international methods of containment, deterrence, and coercive diplomacy not only could work in the new age of terror, but in fact had worked. Iraq had no WMD because the previous decade of sanctions and pressure had effectively deterred Saddam from reviving his earlier programs. Thus, by insisting on military action, the U.S. aborted a long-established international protocol for fire prevention that had already succeeded in Iraq. It ignited a fire supposedly to counter another fire that was already effectively extinguished.

Starting the Fire

The U.S. acted in Iraq not as a fire brigade but as an arsonist. This does not describe the administration’s aims, but something more fundamental—the objective character of the American decision in the context of international politics. The motives were mixed, but a central reality remains: the Bush administration opted for war because it considered it intrinsically a good idea. No one can seriously doubt this.

The administration has always acknowledged, even boasted of, the war’s preemptive (actually, preventive) character. It never seriously claimed that the U.S. had been attacked or immediately threatened by Iraq—a claim too preposterous to believe. The initial military success inspired great celebrations of the war’s benefits for America, the Middle East, and the world.

One must therefore consider why this was so, what general mindset lay behind starting the fire, what its particular intent and anticipated effects were. It was supposed to be multi-purpose, first of all preventive, like fires deliberately set by the Forest Service to preempt bigger natural ones—in the famous phrase, to make sure that the smoking gun would not turn into a mushroom cloud. It was also—if one can seriously envision this—supposed to be a surgically precise firestorm. It would kill or drive out the criminal inhabitants of a particular building in a dangerous, unstable, crowded neighborhood without destroying the structure or spreading the fire to the whole city. The fire-strike, moreover, as launched and executed in spectacular fashion, was unaccompanied by serious planning or preparation for extinguishing it and repairing the building. Indeed, Defense Secretary Donald Rumsfeld flatly prohibited this. The fire-strike was expected to be not only surgical but also purgative and curative, driving tyranny and terrorism from Iraq while also bringing peace, freedom, democracy, ethnic, religious, and national reconciliation, and the blessings of a market economy across the region. It would further be self-limiting, dying out on its own and preventing other fires from breaking out, and would promote new constructive activity. The damaged building would be rebuilt better than before by new owners, with no further American exertion required beyond leadership and advice.

The mindset behind this fire was thus a truly extraordinary, heroic example of a phenomenon all too common in international politics: utopian optimism. This is not the mild verdict it might seem. Utopianism is extremely dangerous in international politics, and this particular kind—reckless, ignorant, arrogant, overconfident, and oblivious to logic, facts, and history—is arguably the worst variety.

Fighting the Fire

After deliberately refusing to plan and provide for extinguishing the fire it had started and doing its best to silence the growing number of calls for doing so, the administration tardily discovered that it had a real insurgency on its hands. The story of how this unanticipated fire started and developed is both too complicated and too familiar to rehearse here, but three general points are important for our purposes.

The first is that the U.S. had chances to dampen the fire it had started, if not entirely extinguish it, and rejected them because doing so would interfere with other goals. The best opportunity to end the fire by simply letting it burn itself out came after the downfall of Saddam’s regime and the end of military operations in May 2003, when the first American commander of the occupation, retired Gen. Jay Garner, proposed withdrawing American troops and letting the Iraqis sort things out for themselves. Given the size and character of the American forces and the lack of preparation for an effective occupation, this was logical. But it would have sacrificed the dream of molding Iraq and the entire Middle East according to America’s image and the plan to make Iraq the central base for U.S. regional hegemony.

So Garner was replaced by L. Paul Bremer, and a different, more intrusive occupation ensued. Having started the war because it wanted to, the U.S. failed to end it because it did not really want to—that is, it would not pay the price of sacrificing some goals and assuming attendant risks.

The second fact to emphasize is that in fighting the insurgent fire in Iraq, the U.S. has mainly succeeded in feeding it. This conclusion will not surprise anyone with any sense of history—that war tends to feed on war is one of its oldest and most recurrent themes—and is no longer controversial. A huge literature supports it, the most recent National Intelligence Estimate confirms it, and no amount of spin or denial by the president’s men will make it go away.

Most Americans have come to accept what many analysts have long seen, but they still discuss the reasons for this phenomenon and the dangers it presents in old, superficial ways. The question remains essentially, “How and where did the occupation go wrong, and who was responsible?” The answers almost invariably blame contingent, tactical factors—the wrong kinds of weapons, training, and military tactics; too few troops on the ground; too little knowledge of Iraq; incompetence, inexperience, and corruption; crimes and scandals; political and administrative blunders; and the like. An interesting variant, more popular today than ever, is to blame the Iraqis themselves—not merely the terrorists and insurgents, of course, but also and especially the Iraqi government for failing to do its job.

The discussion of the dangers of a prolonged insurgency and embattled occupation is just as superficial, concentrating mainly on American casualties, the strain on our Armed Forces, the financial and political costs of the war, and the dangers to the homeland of spreading terrorism. Much less attention centers on the most imminent and important threat. Iraq itself is being destroyed—perhaps has been destroyed —both as a state and as a functioning society. Leaving aside the enormous human tragedy, no stable Middle East is conceivable with Iraq as a political, social, religious, ethnic, and economic black hole, creating problems for world peace and stability that are almost incalculable.

Thus, after five years of counterproductive failure, the dominant American perspective on the Iraq War remains marked by endless vistas of myopia. Concentrating attention on tactical failures enables those who decided on and promoted this war to escape accountability and allows its current defenders to justify the original policy while condemning its execution and continuing the war. It lets Americans scapegoat the Iraqis for results for which they were not primarily responsible. The fact is that the U.S. destroyed the former Iraqi governmental apparatus and created a new government under conditions that virtually guaranteed that it would be dysfunctional. It broke the Iraqis’ legs and now complains because they cannot jump the high hurdles. Most importantly, emphasizing the tactical and contingent causes of failure promotes the idea that the war can still be won or further failure averted by changing tactics and adding resources and effort—the rationale behind the current surge. Similarly, concentrating on the immediate costs and dangers of the war for Americans encourages the belief that if these can be reduced to tolerable levels, the problem will basically be solved.

Both views are not merely incredibly shallow but immensely harmful. They ignore the central fact that these tactical and contingent reasons for failure are not accidental. They flow predictably from the nature of the enterprise. The deeper reasons for failure, the fundamental reasons that fighting the war has fed the war, lie in fatal contradictions inherent in the war itself and the policy that led to it and are thus strategic, structural, and irremediable.

Bush-Aznar Transcript: The War Crime of the Century

This is from Juan Cole's blog. The transcript is translated there as well. It is quite interesting. What amazed me is that Bush goes on gushing about democracy and also the threat of Saddam to the US as if this all made sense rather than rhetoric for the masses but maybe before other leaders it is protocol to spout the proper rhetoric. Another interesting point made by Cole is that Saddam would take with him documents implicating the US administration in his biological and chemical weapons programs, a point that seems plausible.

Bush-Aznar Transcript: The War Crime of the Century

I made two claims about the transcript published by El Pais of Bush's conversations with Spanish leader Jose Maria Aznar on 22 February, 2003, at Crawford, Texas.

The first is that the transcript shows that Bush intended to disregard a negative outcome in his quest for a UN Security Council resolution authorizing a war against Iraq. Bush wanted such a resolution. He expressed a willingness to use threats and economic coercion to secure it. But he makes it perfectly clear that he will not wait for the UNSC to act beyond mid-March. He also explicitly says that if any of the permanent members of the UNSC uses its veto, "we will go." That is, failure to secure the resolution would trigger the war.

Uh, that is the opposite of the way it is supposed to work. If you can't get a UNSC resolution, and you haven't been attacked by the state against whom you want to go to war, then you are supposed to stand down.

Both because he set a deadline beyond which his "patience" would not stretch (the poor thing had already waited four months; I mean, is he a toddler that he lacks elementary patience?), and because he specified a UNSC veto as a signal for his launching of the war, Bush made it very clear that he was willing to trash the charter of the United Nations and to take the world back to the 1930s,to an era of mass politics when powerful states launched wars of choice at will on the basis of fevered rhetoric and fits of pique.

The second claim that I made was that Bush was aware of, and rejected, an offer by Saddam Hussein to flee Iraq, probably for Saudi Arabia, presuming he could take out with him a billion dollars and some documents on Iraq's weapons of mass destruction programs. Both provisions were intended by Saddam to protect him from later retaliation. The money would buy him protection from extradition, and the documents presumably showed that the Reagan and Bush senior administrations had secretly authorized his chemical and biological weapons programs. With these documents in his possession, it was unlikely that Bush would come after him, since he could ruin the reputation of the Bush family if he did. The destruction of these documents was presumably Bush's goal when he had Rumsfeld order US military personnel not to interfere with the looting and burning of government offices after the fall of Saddam. The looting, which set off the guerrilla war, also functioned as a vast shredding party, destroying incriminating evidence about the complicity of the Bushes and Rumsfeld in Iraq's war crimes.

Aznar asked Bush if he would grant Saddam these guarantees, and Bush roared back that he would not.

By refusing to allow Saddam to flee with guarantees, Bush ensured that a land war would have to be fought. This is one of the greatest crimes any US president ever committed, and it is all the more contemptible for being rooted in mere pride and petulance.

Note that even General Pervez Musharraf allowed Prime Minister Nawaz Sharif to go to Saudi Arabia with similar guarantees, even though Sharif was alleged to have attempted to cause Musharraf's death. A tinpot Pakistani general had more devotion to the good of his country, and more good sense, than did George W. Bush.

The passage in which Bush agrees with Aznar that it would be better if Baghdad fell without a fight refers to the possibility that the Iraqi officer corps would assassinate Saddam and decline to put up a fight. Bush would very much have liked such a fantasy to come true.

But he did not need to fantasize. He had a real offer in the hand, of Saddam's flight. He rejected it. By rejecting it, he will have killed at least a million persons and became one of the more monstrous figures in recent world history.

I have done a translation of the transcript, with some dictionary work. I would be glad of any corrections, but I think it is good enough for government work. No one can read it without recognizing that Bush was champing at the bit to go to war; that he only wanted the UNSC as a fig leaf and was determined to ignore it if it did not authorize the war; and that he had a deal on the table from Saddam but absolutely refused to pursue it, preferring instead either a sanguinary conflict or his adolescent fantasy of Baghdad falling without a shot.

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Credit Crisis could be just beginning

This is from the Street.

As this article shows the sub-prime mortgages are just the tip of the iceberg. It is the Liquidity Factory driven by greed that is the deeper problem and the poor people who find themselves losing their homes were simply pawns in these investors money making schemes.

Investing
The Credit Crisis Could Be Just Beginning
By Jon D. Markman
Special to TheStreet.com
9/21/2007 6:40 AM EDT
URL: http://www.thestreet.com/newsanalysis/investing/10380613.html

Satyajit Das is laughing. It appears I have said something very funny, but I have no idea what it was. My only clue is that the laugh sounds somewhat pitying.


One of the world's leading experts on credit derivatives (financial instruments that transfer credit risk from one party to another), Das is the author of a 4,200-page reference work on the subject, among a half-dozen other tomes. As a developer and marketer of the exotic instruments himself over the past 30 years, he seemed like the ideal industry insider to help us get to the bottom of the recent debt crunch -- and I expected him to defend and explain the practice.

I started by asking the Calcutta-born Australian whether the credit crisis was in what Americans would call the "third inning." This was pretty amusing, it seemed, judging from the laughter. So I tried again. "Second inning?" More laughter. "First?" Still too optimistic.

Das, who knows as much about global money flows as anyone in the world, stopped chuckling long enough to suggest that we're actually still in the middle of the national anthem before a game destined to go into extra innings. And it won't end well for the global economy.
Ursa Major
Das is pretty droll for a math whiz, but his message is dead serious. He thinks we're on the verge of a bear market of epic proportions.

The cause: Massive levels of debt underlying the world economic system are about to unwind in a profound and persistent way.

He's not sure if it will play out like the 13-year decline of 90% in Japan from 1990 to 2003 that followed the bursting of a credit bubble there, or like the 15-year flat spot in the U.S. market from 1960 to 1975. But either way, he foresees hard times as an optimistic era of too much liquidity, too much leverage and too much financial engineering slowly and inevitably deflates.

Like an ex-mobster turning state's witness, Das has turned his back on his old pals in the derivatives biz to warn anyone who will listen -- mostly banks and hedge funds that pay him consulting fees -- that the jig is up.

Rather than joining the crowd that blames the mess on American slobs who took on more mortgage debt than they could afford and have endangered the world by stiffing lenders, he points a finger at three parties: regulators who stood by as U.S. banks developed ingenious but dangerous ways of shifting trillions of dollars of credit risk off their balance sheets and into the hands of unsophisticated foreign investors, hedge and pension fund managers who gorged on high-yield debt instruments they didn't understand and financial engineers who built towers of "securitized" debt with math models that were fundamentally flawed.

"Defaulting middle-class U.S. homeowners are blamed, but they are merely a pawn in the game," he says. "Those loans were invented so that hedge funds would have high-yield debt to buy."
The Liquidity Factory
Das' view sounds cynical, but it makes sense if you stop thinking about mortgages as a way for people to finance houses and think about them instead as a way for lenders to generate cash flow and to create collateral during an era of a flat interest rate curve.

Although subprime U.S. loans seem like small change in the context of the multitrillion-dollar debt market, it turns out that these high-yield instruments were an important part of the machine that Das calls the global "liquidity factory." Just like a small amount of gasoline can power an entire truck given the right combination of spark plugs, pistons and transmission, subprime loans became the fuel that underlies derivative securities that are many, many times their size.

Here's how it worked: In olden days, like 10 years ago, banks wrote and funded their own loans. In the new game, Das points out, banks "originate" loans, "warehouse" them on their balance sheets for a brief time, then "distribute" them to investors by packaging them into derivatives called collateralized debt obligations, or CDOs, and similar instruments. In this scheme, banks don't need to tie up as much capital, so they can put more money out on loan.

The more loans that were sold, the more they could use as collateral for more loans, so credit standards were lowered to get more paper out the door -- a task that was accelerated in recent years via fly-by-night brokers that are now accused of predatory lending practices.

Buyers of these credit risks in CDO form were insurance companies, pension funds and hedge-fund managers from Bonn to Beijing. Because money was readily available at low interest rates in Japan and the U.S., these managers leveraged up their bets by buying the CDOs with borrowed funds.

So if you follow the bouncing ball, borrowed money bought borrowed money. And then because they had the blessing of credit-ratings agencies relying on mathematical models suggesting that they would rarely default, these CDOs were in turn used as collateral to do more borrowing.

In this way, Das points out, credit risk moved from banks, where it was regulated and observable, to places where it was less regulated and difficult to identify.
Turning $1 Into $20
The liquidity factory was self-perpetuating and seemingly unstoppable. As assets bought with borrowed money rose in value, players could borrow more money against them, and it thus seemed logical to borrow even more to increase returns. Bankers figured out how to strip money out of existing assets to do so, much as a homeowner might strip equity from his house to buy another house.

These triple-borrowed assets were then in turn increasingly used as collateral for commercial paper -- the short-term borrowings of banks and corporations -- which was purchased by supposedly low-risk money market funds.

According to Das' figures, up to 53% of the $2.2 trillion of commercial paper in the U.S. market is now asset-backed, with about 50% of that in mortgages.

When you add it all up, according to Das' research, a single dollar of "real" capital supports $20 to $30 of loans. This spiral of borrowing on an increasingly thin base of real assets, writ large and in nearly infinite variety, ultimately created a world in which derivatives outstanding earlier this year stood at $485 trillion -- or eight times total global gross domestic product of $60 trillion.

Without a central governmental authority keeping tabs on these cross-border flows and ensuring a standard of record-keeping and quality, investors increasingly didn't know what they were buying or what any given security was really worth.
A Painful Unwinding
Here is where the U.S. mortgage holder shows up again. As subprime loan default rates doubled, in contravention of what the models forecast, the CDOs those mortgages backed began to collapse. Because these instruments were so hard to value, banks and funds started looking at all CDOs and other paper backed by mortgages with suspicion, and refused to accept them as collateral for the sort of short-term borrowing that underpins today's money markets.

Through late last month, according to Das, as much as $300 billion in leveraged finance loans had been "orphaned," which means that they can't be sold off or used as collateral.

One of the wonders of leverage is that it amplifies losses on the way down just as it amplifies gains on the way up. The more an asset that is bought with borrowed money falls in value, the more you have to sell other stuff to fulfill the loan-to-value covenants. It's a vicious cycle.

In this context, banks' objective was to prevent customers from selling their derivates at a discount, because they would then have to mark down the value of all the other assets in the debt chain, an event that would lead to the need to make margin calls on customers who are already thin on cash.

Now it may seem hard to believe, but much of the past few years' advance in the stock market was underwritten by CDO-type instruments that go under the heading of "structured finance." I'm talking about private-equity takeovers, leveraged buyouts and corporate stock buybacks -- the works.

So the structured finance market is coming undone; not only will those pillars of strength for equities be knocked away, but many recent deals that were predicated on the easy availability of money will likely also go bust, Das says.

That is why he considers the current market volatility much more profound than a simple "correction" in prices. He sees it as a gigantic liquidity bubble unwinding -- a process that can take a long, long time.

While you might think that the U.S. Federal Reserve can help prevent disaster by lowering interest rates dramatically, as it did Wednesday, the evidence is not at all clear.

The problem, after all, is not the amount of money in the system but the fact that buyers are in the process of rejecting the entire new risk-transfer model and its associated leverage and counterparty risks.

Lower rates will not help that. "At best," Das says, "they help smooth the transition."


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Jon D. Markman is editor of the independent investment newsletter The Daily Advantage. While Markman cannot provide personalized investment advice or recommendations, he appreciates your feedback; click here to send him an email.
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Misery may be just beginning: IMF

This is from the Telegraph.
This analysis shows how the crisis is not restricted but quickly spreads globally because of the nature of the financial instruments involved. I will post another more detailed analysis of the problems as well.

Misery may be just beginning, warns IMF
By Edmund Conway, Economics Editor
Last Updated: 12:16am BST 25/09/2007




The US housing market faces further falls
if credit market problems persist


Even when the financial waters are calm, the International Monetary Fund's Financial Stability Report can make for worrying reading. When markets are in the midst of a major crisis, it can be extremely disturbing.

The message from the latest of these risk assessments is that this crisis is no flash in the pan. The likelihood of further market crunches has increased significantly, it said. Even if these do not occur, there will still be major knock-on effects on the economy.

Jaime Caruana, chief author of the report, said: "After a long period of benign conditions, the financial system is enduring a significant test. This has important implications for the economy. We expect that the process of adjustment will be protracted and there will be implications in terms of the lessons that need to be drawn. There may be some regulatory changes which need to be examined."

He predicted a slowing of the global economy's growth, and said it could help to push up inflation, as markets realise that money is likely to be considerably more expensive in the future.


The report was even more foreboding, saying: "The consequences of this episode should not be underestimated and the adjustment process is likely to be protracted. Credit conditions may not normalise soon, and some of the practices that have developed in the structured credit markets will have to change."

The probability of major financial institutions defaulting has risen dramatically, as jittery investors withdraw money from the market.

With the crisis having originated in the US, all eyes are now on the American property market. The report warned that problems in the credit markets could push US property prices even lower, while the world economy will suffer if the high interest rates in credit markets persist.

"The chances of more severe tightening of credit conditions cannot be dismissed," it said. "Such a tightening could have significant global macro-economic consequences, with the incidence of such tightening falling most heavily on more marginally creditworthy borrowers." Meanwhile, the sub-prime crisis is likely to last "at least through 2008", with more families defaulting as the low introductory "teaser" rates rise, the report said. It added that even if house prices fall only 5pc and then stabilise, losses from the sub-prime defaults would still reach $170bn (£84bn), with a quarter of this lost by banks and the remainder by holders of mortgage-backed securities.



In its latest update of its economic forecasts next month, the IMF is expected to slash its forecast for US economic growth next year – perhaps to as low as 1pc-1.5pc.

Although the crisis has mainly affected US and European markets so far, developing economies are also at risk. In some countries, banks have borrowed abroad in foreign currencies to lend domestically, and with little capital to rely on they are vulnerable to the problems in Western credit markets.

The assessment – given extra weight as the IMF is notoriously conservative with its forecasts – will be a major disappointment to many in the markets who expected a quick recovery.

The report said the crisis stemmed in part from three key weaknesses:

• Uncertainty and poor information about the risks associated with complex financial instruments. Greater transparency is needed.

• Globalisation has meant crises spread faster around the world since, for example, US mortgage debt is owned by investors from Germany and the UK to China and Australia.

• Investors have become over-reliant on ratings agencies which grade various debt instruments. It concluded the agencies should introduce a special ratings scheme for complex structured credit instruments – the products at the centre of the turmoil. It added that institutional investors "must ensure their investment mandates do not lead to an over-reliance on agency letter ratings, and that they do not (implicitly) delegate the job of examining complex assets to ratings agencies."

Auto Armageddon

This was written before the strike and settlement between UAW and GM but it gives a wealth of background information on the situation in the auto industry between the union and the companies. The health care issue is not one that arises in Canada since we have a single payer system. The automakers are obviously offloading responsibility for benefits to the union in the US.

Auto Armageddon?
by Dianne Feeley
TOWARD THE END of July the United Auto Workers (UAW) held the traditional handshaking ceremony that formally opened contract negotiations with executives at Ford, General Motors and Chrysler, what used to be called the Big Three.

UAW President Ron Gettelfinger admonished the press that the union is not in a concessionary mode. Veteran observers and auto worker activists recognize this as a sure signal that massive concessions are imminent. Outside the UAW-GM Center for Human Resources a hundred auto workers, mostly retirees, carried signs opposing further concessions.

What are the crunch issues? Pensions, health care, two-tier wages, temporary work, job classifications: According to one well-placed source in the bargaining, "This year the companies are coming after everything. They want it all." To understand the depth of the UAW's crisis, we have to look at the big picture of U.S. labor as well as the auto industry's woes.

The Long Retreat
A decade after the victory of the United Parcel Service (UPS), we look back at that successful 1997 strike for 10,000 full-time jobs that seemed to be the turning point in the one-sided class war. Instead it has been a decade of a continuing employers' assault.

Bankruptcy has become a corporate tool across industries from airlines to car haul, imposing restructuring and concessions. Shockingly, Labor Notes recently reported that the average labor cost per major airline is now lower than the average fuel cost. Before 2001 the labor cost was double the fuel.

Today union density stands at 7.4% in the private sector. U.S. work stoppages (involving over 1,000 workers) are lower than ever before recorded. The workplace, whether blue collar or white collar, has been transformed by lean production and outsourcing. As more employers use temporary workers or contract workers, job security has become an old-fashioned idea. Today the main issue in union negotiations is a battle over the employer's attempt to shift health care costs.

In this context, lower-wage workers no longer see higher-wage workers as setting a standard, but as having benefits they can never aspire to have. Where solidarity among workers has been trampled, competition rears its ugly head.

Gettelfinger's militant press sound bite is lost in the wind, particularly after the UAW president had promised "no concessions on health care" in the 2003 contract, but agreed to reopen the contract at GM and Ford, saving the companies millions of dollars. As the 2007 negotiations got underway, it looked like they were calling Gettelfinger's bluff.

Last year the Big Three posted a combined loss of $15 billion and, backed by "industry analysts," state that reducing labor costs is critical to their survival. While labor costs represent only 10% of the price of a new vehicle, the Big Three have been waging an aggressive and sustained media blitz around the theme that wages and benefits for union-represented autoworkers are out of control. Despite Gettelfinger's comment, the UAW has not countered the corporations' mantra, either in the media or internally. Earlier this year Cal Rapson, UAW Vice President in charge of GM, cautioned local union leaders that "the way we conducted business in the past when General Motors was very profitable, would have to change." ("UAW prepares for sacrifices," Sharon Terlep, Detroit News, 1/16/07). Local officials and even workers recently interviewed at plant gates expect the 2007 contract will contain drastic givebacks.

What's the reality?

Market Share Drives the Crisis
The Detroit automakers' share of the domestic market fell below 50% in July 2007, the first time in history. When I first hired into an assembly plant almost 30 years ago, GM alone controlled the majority of the U.S. market. There are as many auto workers today as there were then, but a growing proportion work in the almost completely non-union transplants or for non-unionized auto parts suppliers.

According to Sean McAlinden, chief economist for the Center for Automotive Research, less than 23% of all U.S. autoworkers belong to a union. ("UAW strike, or Detroit 3 lockout, not likely," Dale Jewett, Automotive News, 8/8/07)

Plants in the Midwest are shutting down as plants open in the South – "right-to-work" states where unionization is locked in single digits. Meanwhile Michigan, a state with an economy 700% more concentrated in the auto industry than the national economy, saw its gross domestic product shrink in 2006.

By mid-2007 Michigan's unemployment rate remained the highest in the country. Between 2000-06 Michigan lost 336,000 jobs (80% from manufacturing, construction and government), yet its unionization rate – 19.6% – remains well above the national average. ("Economic outlook bleak," Louis Aguilar, Detroit News, 10/18/06)

For conservative think tanks and politicians union density is the #1 reason why Michigan can't attract new business. Their answer: make Michigan the 23rd right-to-work state! ("Worst yet to come for Michigan economy," Louis Aguilar, Detroit News, 6/14/07; "Open-shop laws threaten unions," Sharon Silke Carty, USA Today, 7/26/07)

While plants in Detroit, Flint, Pontiac, St. Louis and even Oklahoma City shut down, Toyota opened a plant in San Antonio, Texas; Hyundai Motor Co. inaugurated a facility in Montgomery, Alabama; and KIA is planning one for West Point, Georgia.

What's the difference between a unionized plant and the more than two dozen non-unionized ones? Actually, transplants pay pretty well – particularly in the context of generally low-wage regions. In 2006 wages at the Toyota plant in Georgetown, Kentucky, when the $6,000 bonus was figured in, were $30 an hour. Honda workers, who have been receiving yearly bonuses for more than 20 years, brought home $26.20 per hour. Nissan workers in Mississippi earn $24 an hour and $26 an hour in Tennessee.

Hyundai Motor Co. pays its workers less than other autoworkers. In 2006 a new employee earned $14.79 an hour in its Alabama plant; after two years the wage is raised to $22.50.

Transplants also have health insurance and retirement plans, although a worker contributes more than a UAW member, who has better coverage. ("UAW losing pay edge," Jason Roberson, Detroit Free Press, 1/31/07)

Workers in a non-union plant, however, suffer 4-12 times the injury/illness rate of UAW members in a comparable plant. With newer plants and a workforce significantly younger than most UAW-organized plants, transplants offer little job security. Given the injury rate, I suspect it is much harder for a transplant worker to remain working for a corporation for 30 years.

For the most part, only the relatively young and fit are able to survive in the "flexible" work environment – and that's the kind of environment the Big Three want to establish as well. This environment includes draconian absentee programs, and no "light" jobs for workers returning to work after an injury – those jobs have all been outsourced.

It's true that as the work force in transplants ages, labor costs will rise. But I suspect they will remain a lower percentage than at unionized plants. On the other hand the Big Three are doing their part to weed out workers who are injured on the job or have the audacity to miss work.

Today Detroit-based automakers complain that each vehicle they produce costs approximately $25 an hour more in labor costs per worker than a vehicle produced at a transplant. This disadvantage is broken down into $7 in wages for active workers, $5 for their health care benefits and $12 for retiree health care, pension and other insurance costs.

I assume the $7 in wages represents work rules that are already being eroded through local concessions. Additional areas in which the corporations would like to ape practices in non-union plants include outsourcing jobs not considered "productive" (maintenance and janitorial services, even transporting materials within the plant), using temporary workers, hiring new workers at a lower pay scale and with fewer benefits, eliminating or scaling back the jobs bank under which laid-off workers are still paid.

Shifting some managerial tasks to production workers – scheduling vacations, arranging group meetings, overseeing quality issues – is another way to lower wages. ("Talks likely to reshape industry," Joe Guy Collier, Detroit Free Press, 7/1/07; "Tough Talks," Jeffrey McCracken, Wall Street Journal, 3/2/07; and "Desperate to Curb Costs, Ford Gets Union's Help," Jeffrey McCracken, Detroit Free Press, 3/2/07)

Does accepting all this sound far-fetched for a longstanding industrial union like the proud UAW? David Berkholz opens his August 20 Automotive News article "UAW budges on 2-tier wage" by stating, "The UAW is quietly backing away from its bedrock philosophy that hourly employees working under the same roof should earn the same wage."

Health Care: The VEBA Trap
The Big Three say their combined retiree health care cost is in the range of $116-120 billion. They would prefer to get out from under that liability by turning a one-time contribution over to a Voluntary Employee Beneficiary Association (VEBA) administered by the union.

Despite the reality that health care costs are rising sharply (73% since 2000), they plan to negotiate a "deal" to fund the VEBA at a mere 50-60% of the total liability. For example, GM has approximately $52 billion in UAW health-care liabilities (with another $18 billion for white-collar workers). Ford has $31 billion in liabilities while Chrysler owes $16-19 billion. ("After Years of Labor Gains, Autoworkers Face Losses," Sholnn Freeman, Washington Post, 7/17/07)

By putting in half of what they say they owe, Detroit automakers want to be done with their promise to fund health care for retirees and wipe the slate clean. If health care costs rise dramatically, the problem wouldn't be GM's problem, but the UAW's.

While everyone points to the VEBA that Goodyear and the Steelworkers negotiated last year after a strike, that VEBA was funded at 83% of the company's liability ($1 billion of $1.3 billion). David Welch & Nanette Byrnes, writing in Business Week last May, noted that in setting up VEBAs the devil is in the details: "If the union seeks assets totaling 80% of liabilities, then GM and Ford may not be able to afford it."

If GM and Ford can't "afford" it, I guess that's enough to settle it!

Rank-and-file autoworkers analyze the situation differently. Workers signed contracts on the basis that companies provided health care; now the companies want to renege on the agreement. Without that promise, autoworkers would have demanded higher wages.

Further, workers agreed to concessions when they approved their cost-of-living adjustments (COLA) being diverted to health care costs. Between 1976-2005 each worker at the Big Three gave up more than $1 an hour in COLA diversion. Now the companies are hoping no one notices that they intend to pocket that money. ("Live Bait & Ammo #89: Deduction by Diversion")

Does a VEBA have to be underfunded? Absolutely not. In fact, a cross-industry, multi-employer VEBA, which provided health care for all workers (union and non-union, assembly workers, parts workers and skilled trades), could be set up so that each employers paid in on a per capita rate. Employers would contribute regularly so that the fund would be remain solvent.

All of the VEBAs that have been crippled are single-employer plans, such as Detroit Diesel or Caterpillar, or have been the result of a corporation going into bankruptcy. I'd say a multi-employer VEBA would be the next-best thing to a single-payer health care program every other industrialized nation, including Canada, already has. But Sean McAlinden explained why that won't happen: "Each automaker can better negotiate what it could contribute to the fund." (Quoted in "UAW strike, or Detroit's lockout, not likely," Dale Jewett, Automotive News, 8/8/07)

If dumping underfunded health care liabilities on the union isn't the answer to health care costs, where might we find a solution? The first thing that pops out at an autoworker is how GM brags about "saving" $1,200 on every vehicle it manufactures in Canada. Why? Because Canada has a universal health care system.

GM loves the Canadian health care system. But instead of demanding that the U.S. government control health care costs by extending Medicare and universalizing its coverage to the entire population – which would reduce the percentage each corporation would need to contribute – they insist the individual employee should shoulder more of the costs.

Whose Pensions?
The $12 figure per vehicle that is attributed to retirees includes not only health care but pensions as well. Actually corporate contributions to pension plans are tax-deductible and grow tax-free. Congress set this rule so that employers would be encouraged to provide pension plans. As a matter of fact, GM owes almost 700,000 workers and retirees about $87.8 billion as of 2005. But $95.3 billion has already been set aside, generating $10 billion in investment income that year alone.

So what's the issue? The problem is executive pension obligations. Since these are not tax-deductible, they are typically left unfunded. While the worker's pension is about 25-35% of his/her salary, a highly placed executive will be compensated at 60-100%.

Ellen E. Schultz and Theo Francis, writing in the Wall Street Journal last year, noted that "Benefits for executives now account for a significant share of pension obligations in the U.S., an average of 8%.. Sometimes a company's obligation for a single executive's pension approaches $100 million."

They suggest that the GM's executive pension is probably in the neighborhood of $1.4 billion, but that figure is kept securely under wraps as government regulations do not require disclosure. In fact, corporations hide their executive pension obligations by dumping them into the legacy costs they cite for their unionized work force. ("As Workers' Pensions Wither, Those for Executives Flourish," 6/23/06)

The Buzz About Health Costs
On the Soldiers of Solidarity email list there has been discussion about Shikha Dalma's July 27th Wall Street Journal commentary, "The UAW's Health Care Dreams." Dalma asserts that the UAW has the capacity to destroy the Big Three by pushing them into bankruptcy by demanding a continuation of previously negotiated "lavish health-care and pension deals."

Dalma contrasts UAW benefits with the 90% of all U.S. workers who don't get any employer-provided health care coverage after they become eligible for Medicare. "Such couples, according to an analysis by Fidelity Investments last year, are typically on the hook for $10,000 in out-of-pocket annual costs for Medicare co-pays and other expenses not covered by the program, or 10 times more than UAW couples."

This article is typical of the media coverage that tries to play off low-paid workers against workers who have been able to win more. We are supposed to be jealous of any workers who have higher wages or better benefits. On the other hand, we are to believe the corporate elite has the right to their wealth.

Eighty top executives at Ford, General Motors and a dozen auto suppliers had an average income of $4.2 million in 2006, a 22% increase over 2005. Rarely does a reporter note that it's the elite who got the auto industry into the pickle it's in, or raise the question of why workers should have to take concessions. That's just the given.

Dalma cites the union as possibly pushing the corporations into bankruptcy. In fact corporations use bankruptcy as another mechanism through which they can vigorous advance restructuring and force the union to accept concessions. Here the star witness in the auto industry is Delphi, the corporation GM spun off in 1999.

Delphi's Bankruptcy
When it declared bankruptcy in 2006 Delphi had $4 billion in cash, 24,000 workers and more than two dozen U.S. plants. Most of its losses were the result of the skyrocketing costs of raw materials. GM, Delphi's major customer, refused to adjust the contracts; Delphi was supposed to eat the difference. Here again, it wasn't labor cost that was the problem, but an intransigent customer! ("Delphi, The Terminator, and the Misuse of Bankruptcy Law," interview with Mark Reutter, Executive Intelligence Review, 11/11/05)

When the corporation went to bankruptcy court, Gretchen Morgenson wrote in the business section of the New York Times, Delphi made sure that the top executives were protected while workers bore "the entire brunt of the company's financial crisis." Although its accounting practices were being investigated by the Securities and Exchange Commission, Delphi made sure its top four executives were in line to receive a total of $3.1 million a year. ("Oohs and Ahs At Delphi's Circus," 11/13/05)

At the UAW 34th Constitution Convention last year, a couple dozen delegates published an open letter "Draw the Line at Delphi." They proposed a fightback campaign but officials did all they could to shut down discussion. Early on rank-and-file Delphi workers and their allies, organized as Soldiers of Solidarity (www.soldiersofsolidarity.com) met to discuss their common problems and map out a strategy.

We organized a demonstration of over 600 at the 2006 Detroit auto show, threw up picket lines when corporate executives spoke at public meetings and encouraged fellow workers to "work safely" on the job. We were strong enough to stave off Delphi's attempt to use bankruptcy to railroad concessions, but not strong enough when Delphi, with the union's consent, offered buyouts.

Two years later, when Delphi and the UAW agreed to submit a contract to those Delphi workers who had not been tempted by a buyout package or who could not "flow back" into General Motors, fewer than 4,000 high-seniority workers were still working. Under the two-tier agreement introduced into the 2003 contract, 13,000 others had been hired at $14 an hour.

Sixty-eight percent voted to accept the contract. Only one plant, located in Lockport, New York, where 80% of the workforce was still high seniority, voted no. As Joe Coolick, 20, hired a year ago at Delphi Flint East complex told the Louis Aguilar, Detroit News reporter, "This pay is still better than what you can make working at Speedway or McDonald's, that why people want to keep this job." ("Waiting on more wage cuts," 6/21/07)

Delphi's 4,000 high-seniority workers will be given $35,000 for three years as a "buydown" for accepting a permanent $9 an hour wage cut, or they can take a "buyout" package and leave. A competitive operating agreement will abolish a number of the work rules and reduce the trade classifications down to two, electrical and mechanical. Delphi will sell or close all but four U.S.-based plants.

Delphi anticipates emerging from bankruptcy by the end of the year. One of the 10 most expensive bankruptcies out of 74 in the recent period, the Delphi bankruptcy has cost $200 million and may reach $300 million. I'm sure they consider the price of bankruptcy necessary in order to successfully drive down wages and working conditions.

U.S. Bankruptcy Judge Robert Drain has approved $184 million in fees and $13 million more in Delphi expenses. These include lawyer's fees of $300-400 an hour – this from a corporation that moaned over a production worker supposedly making $73 an hour including benefits. ("Delphi bankruptcy bill: $200M," David Shepardson, Detroit News, 7/17/07)

Shortly after the Big Three-UAW 2003 contracts were signed, the corporations wept over their loss in market share, with GM and Ford first in line to demand health care concessions. The UAW, which had announced a "no health care concessions" policy going into the negotiations, hired investment bank Lazard Ltd. as consultants but after listening to Lazard's report, reversed course and reopened negotiations.

The UAW then recommended its membership vote to divert already bargained cost-of-living adjustment (COLA) to health care and accept higher co-pays. Last year at GM alone this concession saved the company $15 billion in retiree health care benefits and almost $3 billion in health care for current employees. Ford trimmed $5 billion.

Having secured a COLA diversion of seventy-nine cents per worker between 2005 and 2011, which will be placed in a VEBA, General Motors and Ford moved ahead on their restructuring plans. ("UAW May Higher Lazard for Advice in U.S. Auto Talks, People Say," Jeff Green & John Lippert, Bloomberg News, 6/28/07; "UAW prepares for sacrifices," Sharon Terlep, Detroit News, 1/16/07)

By the time still profitable Daimler Chrysler indicated it too wanted concessions, opposition was growing and the UAW's DaimlerChrysler Council, made up of local union officers, blocked reopening of their contract. Thus the UAW pattern contract, long a source of pride, today exists only at the now Cerebus-owned Chrysler.

What Happened?
How could Ford, posting an industry record profit of $7.2 billion in 1999, have ended up six years later with a $12.7 billion loss? In 1998 the Harbour Report, an industry efficiency study, estimated Ford could assemble a new vehicle in 36 hours, 10 hours faster than GM or DaimlerChrysler, but 5-6 hours slower than Toyota and Nissan.

Didn't Ford executives analyze the data and notice, two years later, that GM and DaimlerChrysler were reducing the gap? Apparently not. By 2006 the Harbour Report found Ford two hours behind GM and DaimlerChrysler, slipping 6-7 hours behind Toyota and Nissan. ("Tough Talks," Jeffrey McCracken, Wall Street Journal, 3/2/07)

Ford executives acknowledge that they didn't prepare for the future – but immediately sought a fix by approaching the UAW and demanding concessions on work rules. Over the past year 33 of the 41 UAW locals have reopened negotiations, altered their contracts in mid-point and accepted "competitive operating agreements."

Provisions vary from plant to plant but include allowing non-Ford workers earning lower wages to take certain jobs in the plant (such as sorting and packing or transporting components within the factory), waving seniority rules, broadening job definitions and working four 10-hour days without collecting overtime pay. This makes the work force more "flexible" and sets a precedent for the upcoming contract talks.

After all, if it is the UAW's job to save the corporation money, it certainly can't take a militant stance in persevering and extending workers' rights, wages and benefits.

In fact, the crisis of the Big Three is not that labor costs are so outrageous but the irresponsible decisions management made. Since the profit per vehicle is higher on trucks and SUVs than on small- or medium-sized cars, management decided they'd pass up production on efficient and well-designed passenger cars and concentrate on the higher profit market. Today trucks still represent 30% of the vehicle mix at Ford and GM, while only represent 5% at Toyota. ("U.S. automakers lose majority of domestic market," Tom Kirsher, AP, 8/1/07)

With little concern about the future of the earth, management downgraded research and design and fight tooth-and-nail against government standards to improve fuel efficiency. While Toyota spends 12% of its capital expenditure revenue on research and development, GM spends just 8.4%. ("A Deal That Could Save Detroit," David Welch and Nanette Byrnes, Business Week, 5/28/07)

To date Ford has eliminated 38,000 of its 87,000 hourly work force and plans to idle 14 plants. GM is slashing 34,000 jobs and announced it will close 12 plants. Chrysler anticipates eliminating 9,000. Each corporation is offering a severance package for those who leave or retire. ("Ford to Cut 25,000 to 30,000 Jobs by 2012," Dee-Ann Durbin, AP, 1/23/07)

With the stampede to get these workers out, the Big Three and auto parts suppliers find they don't have enough workers. By June 2007 Ford was employing between 2,000- 2,5000 temporary, part-time production workers. Technically in the union, these temps earn half the pay of full-time workers, have minimal benefits and no ability to move to permanent status after working a set number of days. They can be terminated after one "offense."

Meanwhile executive pay plans continue to be lavish. Ford president and chief executive Alan Mullally last year received a compensation package of $39 million, GM's Richard Wagoner made $9.6 million and Chrysler Group executive Tom LaSorda brought home $5.2 million. ("Talks likely to reshape industry," Joe Guy Collier, Detroit Free Press, 7/1/07)

Although their market share is still in free fall, at the end of the second quarter of 2007 both GM and Ford reported profits: Ford earned $750 million and GM came in at $891 million. As the business pages announced these profits, reporters wondered if this might enable the union stave off an utter rout.

What Should Our Union Do?
In fact, many autoworkers who oppose concessions have concluded that the Big Three and the top-tier part suppliers are pulling a scam. Labor costs are not the problem. Today's work force is productive, and yesterday's already won the right to health care and pensions.

We see how the corporate elite are giving themselves higher salaries and benefits even though they skimped on research and development, they banked on an oil-based economy, they did not analyze reports that revealed the weakness of their decisions.

Clearly the Big Three is in a crisis that requires serious rethinking and retooling. But this does not mean nickel-and-diming its work force, as Detroit automakers intend.

What should inform our proposals as we face this manufactured crisis?

First, we need to reassert the centrality of solidarity. If we as a work force allow ourselves to be pitted against each other – temporary workers vs. permanents, active workers vs. retirees, lower-wage workers vs. seniority workers, production workers vs. skilled trades and all the other ways a diverse population can be split – we all lose.

This also means we must oppose outsourcing of jobs and the ruthless practice of having workers in one plant take concessions in order to "win" new products, or products that workers in another plant are producing – all of which is happening now.

Second, we need to understand that local concessions do not "save" jobs but fuel corporate ability to play off workers in one site against another. The European metalworkers unions have attempted to deal with the problem by raising the slogan "No plant closures and equitable use of capacity." These unions followed through with concrete acts of solidarity when GM unilaterally shut down a third shift in an Astra plant. We must do the same.

Third, we need to campaign to end the stranglehold corporations have on all workers by supporting the extension of Medicare to all who reside here. This would go far toward winning lower-wage workers to seeing higher-wage workers bring up the wages and benefits of all. It would eliminate the terrible gap in medical care that exists here, with 47 million without coverage. It would also deprive corporations and the media of their argument about how autoworkers don't "deserve" the welfare-state coverage we have with our health insurance.

Fourth, we need to organize the growing number of autoworkers who do not belong to the union. This includes not just the unorganized transplants, but the auto parts sector, which today is only 20% unionized. I don't believe this organizing will occur under the traditional organizing model, but can only be carried out successfully when a core of activists at a plant declares itself a union and initiates campaigns that are in the interests of the majority. This model referred to as non-majority unionism.

Fifth, we need to protect any autoworkers fired for being a union member or acting with others to build union-organized campaigns. This protection should include legal channels but the most important aspect needs to be publicizing the cases through pickets, rallies, fundraisers, etc. This campaign cannot be confined to our national borders.

Sixth, we ourselves need to develop a big-picture understanding of our economy and our role as workers, members of a community, and stewards of our world. Why should we support the auto companies as they fight to reduce emission standards?

Yet once again this August the UAW planned more than two dozen anti-CAFÉ rallies, supporting the Big Three's position. The reason the UAW does so is "jobs." This reminds me of the dilemma posed by Jack Benny's joke when the man with a gun says "Give me your money or your life" and Benny asks, "Give me a minute to think about it."

GM, Ford and Chrysler expect us to go along with concessions because they believe "there is no alternative." Instead of tying ourselves to the company we work for, we need to be thinking about the world we want to create. There is plenty to do to oppose the concessions, but there is also the need for serious democratic discussions about the possibility of building more efficient transportation systems – to sustain not only our jobs, but our planet. •

Dianne Feeley is a long-time union activist in the USA.

From Against The Current 130 (September/October 2007)

~~~~~~~~~~~~~~~(((( The B u l l e t ))))~~~~~~~~~~~~~~~

Senate Endorses Plan to Divide Iraq

This is from the Washington Post.
It seems that there is a bi-partisan agreement that it is appropriate for the US Senate to rule on how Iraq should be divided and organised. I wonder what the US would think if Russia or China passed a resolution indicating what States there should be in the US and what the relationship should be between them and the federal government. Of course they would think that Russia or China had no business doing that and that it was an insult to US sovereignty.
THe US acts as if it were an occupier and the real sovereign power in Iraq. Of course it is and acts such as this show that talk of democracy in Iraq is for public consumption.
Unfortunately for the US it cannot always determine what will happen in Iraq. Certainly events on the ground are already tending in the direction of three regions but there are some nationalists including Sadr and many of the Sunnis who want a strong central government. The US plan is likely to excacerbate the civil and ethnic strife and result in even more ethnic cleansing.

Senate Endorses Plan to Divide Iraq
Action Shows Rare Bipartisan Consensus

By Shailagh Murray
Washington Post Staff Writer
Wednesday, September 26, 2007; 3:38 PM



Showing rare bipartisan consensus over war policy, the Senate overwhelmingly endorsed a political settlement for Iraq that would divide the country into three semi-autonomous regions.

The plan, conceived by Senate Foreign Relations Chairman Joseph R. Biden Jr. (D-Del.), was approved 75-23 as a non-binding resolution, with 26 Republican votes. It would not force President Bush to take any action, but it represents a significant milestone in the Iraq debate, carving out common ground in a debate that has grown increasingly polarized and focused on military strategy.

The Biden plan envisions a federal government system for Iraq, consisting of separate regions for Iraq's Shiite, Sunni and Kurdish populations. The structure is spelled out in Iraq's constitution, but Biden would initiate local and regional diplomatic efforts to hasten its evolution.

"This has genuine bipartisan support,and I think that's a very hopeful sign," Biden said.

One key Republican supporter was Sen. John W. Warner (R-Va.), who under strong White House pressure last week abruptly withdrew his support for a proposal to extend home leaves for U.S. troops. Numerous Republicans considered supporting the extension, but they backed off when Warner reversed his stance. The veteran GOP lawmaker called the vote on the Biden plan "the high-water mark" for bipartisan efforts on Iraq this year.

Warner said the vote represented a de facto acknowledgement of the now widely held view that Iraq's long-term problems cannot be solved militarily. "This amendment builds on that foundation," said Warner. "This amendment brings into sharp focus the need for diplomacy."

The resolution collected an unusually diverse group of co-sponsors who disagree sharply on other aspects of the war, in particular how long U.S. combat troops should remain. The list ranges from conservative Sens. Kay Bailey Hutchison (R-Tex.) and Sam Brownback (R-Kan.), a GOP presidential contender, to liberal Sens. Barbara Boxer (D-Calif.) and Barbara A. Mikulski (D-Md.).

"We can't walk away from Iraq," said Hutchison. "That would make all the sacrifices that have been made irrelevant. But we do have a potential solution that can save American lives in the future."

Boxer said: "I see here a light at the end of a very, very dark tunnel. A darkness that is impacting our nation. It's impacting the Senate. In a way, we are paralyzed."

The vote also was a political boon for Biden, one of the Democrats' most respected foreign policy voices, yet a long-shot for his party's 2008 presidential nomination. The floor debate, which started last week, provided the struggling candidate with a moment in the spotlight -- and Biden made the most of it. He spent hours on the Senate floor, held two news conferences, and placed an op-ed Monday in the State, a newspaper in Columbia, S.C., an early 2008 primary state.

Two of Biden's competitors, Sens. Hillary Rodham Clinton (D-N.Y.) and Christopher J. Dodd (D-Conn.), voted with him. Sen. Barack Obama (D-Ill.) missed the vote, as did Sen. John McCain (R-Ariz.), a GOP presidential candidate and a leading war supporter.

Biden has made his Iraq plan the centerpiece of his 2008 candidacy, and he will likely herald his Senate success in a Democratic debate tonight in New Hampshire.

3 Democratic presidential hopefuls: Combat troops might be in Iraq after 2013!

So voting for a Democratic president in all likelihood will not assure an end to US combat involvement in Iraq. In fact things will turn out such that there will be no choice for anyone who wants the US out immediately or even soon. The anti-war groups might as well vote for a candidate outside the Tweedle Dee-Tweedle Dum framework.


Dems can't make guarantee on Iraq troops By BETH FOUHY, Associated Press Writer
Wed Sep 26, 9:46 PM ET



HANOVER, N.H. - The three leading Democratic presidential hopefuls conceded Wednesday night they could not guarantee that all U.S. combat troops would be gone from Iraq by 2013, the end of the next president's first term in office.



"I think it's hard to project four years from now," said Sen. Barack Obama of Illinois in the opening moments of a campaign debate in the nation's first primary state.

"It is very difficult to know what we're going to be inheriting," added Sen. Hillary Rodham Clinton of New York.

"I cannot make that commitment," said former Sen. John Edwards of North Carolina.

Sen. Christopher Dodd of Connecticut and New Mexico Gov. Bill Richardson provided the assurances the others would not.

"I'll get the job done," said Dodd, while Richardson said he would make sure the troops were home by the end of his first year in office.

The opening question of the two-hour debate plunged the eight contenders into the issue that has dominated all others in the race for the White House.

With the primary season approaching, all eight have vied with increasing intensity for the support of anti-war voters likely to provide money and organizing muscle as the campaign progresses.

Edwards said his position on Iraq was different from Obama and Clinton, adding he would "immediately drawn down 40,000 to 50,000 troops." That's roughly half the 100,000 that Gen. David Petraeus, the top U.S. commander in Iraq, has indicated could be stationed there when President Bush's term ends in January 2009.

Edwards sought to draw a distinction between his position and that of Clinton, saying she had said recently she wants to continue combat missions in Iraq.

"I do not want to continue combat missions in Iraq," he said.

Clinton responded quickly, saying Edwards had misstated her position. She favors the continued deployment of counterterrorism troops, not forces to engage in the type of combat now under way.

Asked whether they were prepared to use force to prevent Iran from becoming a nuclear power, several of the hopefuls sidestepped. Instead, they said, all diplomacy must be exhausted in the effort.

Moderator Tim Russert of NBC News asked about Republican presidential hopeful Rudy Giuliani's pledge to set back Iran by eight to 10 years if it tries to gain nuclear standing.

Sen. Joe Biden flashed anger at the mention of the former New York mayor. "Rudy Giuliani doesn't know what the heck he's talking about," the Delaware senator said. "He's the most uninformed person on foreign policy that's now running for president."

Gates seeks 190 billion for wars.

When it comes to social programs such as universal health care --which virtually every advanced capitalist state has except the US--the immediate outcry if anyone suggested that it would cost this much would be: We can't afford it. Apparently when it comes to wars this never comes up. The Democrats may howl and try to tag on some stuff to the appropriations bill but they will eventually give in. Maybe anytime someone complained about the cost of a single payer system that proponents should say: But you don't support our sick Americans!

Gates seeks $190 billion for wars
By ANNE FLAHERTY
ASSOCIATED PRESS WRITER


Def. Sec. Robert Gates, center, with Deputy Sec. of State John Negroponte, left, and Outgoing Chairman of the Joint Chief of Staff, Gen. Peter Pace, right, at a hearing before congress on FY08 presidential supplemental budget request for the Iraq and Afghanistan war efforts, Wednesday, Sept. 26, 2007 in Washington. Gates is asking to approve $190 billion, increasing initial projections by more than a third. (AP Photo/Pablo Martinez Monsivais)
WASHINGTON -- Defense Secretary Robert Gates asked Congress Wednesday to approve nearly $190 billion for the wars in Iraq and Afghanistan in 2008, increasing initial projections by more than a third.

The spending request guaranteed another showdown between the Bush administration and congressional Democrats, including Sen. Robert Byrd, who declared the Appropriations Committee he chairs would not "rubber stamp" the request.

Testifying before the panel, Gates said the extra money was necessary to buy vehicles that can protect troops against roadside bombs, refurbish equipment worn down by combat and consolidate U.S. bases in Iraq. A copy of the remarks was obtained in advance by The Associated Press.

"I know that Iraq and other difficult choices America faces in the war on terror will continue to be a source of friction within the Congress, between the Congress and the president and in the wider public debate," Gates said in prepared testimony.

"Considering this, I would like to close with a word about something I know we can all agree on - the honor, courage and great sense of duty we have witnessed in our troops," he added.

A group of anti-war protesters in the hearing room cheered at several points during Byrd's speech, including when the West Virginia Democrat asked Gates whether America was more secure "as a result of this massive, astronomical investment."

"I believe the answer is crystal clear. We are not!" Byrd said.

In February, President Bush requested $141.7 billion for the wars; officials said at the time the figure was only a rough estimate and could climb. In July, the Defense Department asked Congress for another $5.3 billion to buy 1,500 Mine Resistant Ambush Protected (MRAP) vehicles.

Gates said Wednesday another $42 billion is needed to cover additional unforeseen requirements. The extra money includes:

- $11 billion to field another 7,000 MRAP vehicles in addition to the 8,000 already planned;

- $9 billion to reconstitute equipment and technology;

- $6 billion for training and equipment of troops;

- $1 billion to improve U.S. facilities in the region and consolidate bases in Iraq; and

- $1 billion to train and equip Iraqi security forces.

The $190 billion total would cover war costs for the 2008 budget year, which begins Monday. Congress was on track this week to pass a stopgap spending bill that would keep the war afloat for several more weeks, giving Democrats time to figure out their next step on the war.

Democrats say they plan to use the spending request as leverage to bring troops home, although they lack a veto-proof majority to do so.

Congress should approve the request as quickly as possible "and without excessive and counterproductive restrictions," Gates will tell the Senate, according to his testimony. Doing so, he added, helps the Pentagon to better manage its resources and avoid shifting money around, which often requires additional cash.

Wednesday's request of $42 billion takes into account Bush's decision to bring home five Army brigades by next summer, Gates said.

To date, Congress has appropriated about $450 billion for the war in Iraq, and $127 billion for Afghanistan.

Iraq Iran border in chaos over detainee dispute

This is all precipitated by the US seizure of an Iranian and continuing to hold him despite claims both the by the Kurdish regional and central government that he was an invited guest. The US seems not to give a tinker's damn about the issue of sovereignty or that this is a blatant insult both to the Kurds and the central government. The border chaos is not causing any harm to the Americans directly so they just ignore so-called sovereign Iraq.


Iraq-Iran border chaos over detainee dispute by Abdel Hamid Zebari
Tue Sep 25, 11:48 AM ET



ARBIL, Iraq (AFP) - Iran's sudden closure of its border with northern Iraq caused trucking chaos at the frontier on Tuesday, as experts warned of severe economic fallout and traders scrambled for goods.



"There are a huge number of trucks waiting to cross the border into (Iraqi) Kurdistan but the Iranians are not allowing them through," said the mayor of Joman town near the Haj Umran border post in northern Iraq.

"The trucks are carrying frozen goods such as chicken, meat and eggs which are going to spoil. We spoke to the Iranian officials but they refused to allow the border post to open," Abdul Wahid Koani told AFP.

Tehran said on Monday it was closing its frontier with Iraq's autonomous Kurdish region in protest at the detention last week of an Iranian by US troops.

Angry Kurdish merchants in the northern city of Arbil said they were being forced to search for other sources of foodstuffs and electronic goods, the main items imported from Iran.

"This closure will raise the prices in our markets and will cause big problems to our business all over the province, especially for those dealing in foodstuffs and household equipment," said merchant Najat Ahmed.

Another trader, Dulair Hajji Mohammed, said dealers would start looking to Turkey and Syria if the closure continued for long.

"The overwhelming majority of goods in Kurdistan markets are Iranian-made," said Mohammed. "But if the borders continue to be closed, we will be forced to look for Syrian and Turkish goods despite their higher cost."

Economic analyst Mohammed Salman of the University of Arbil warned that people on both sides of the frontier would be affected.

"The closure of the border will hit both the Iranians and Iraqis because Kurdistan is considered a fertile market for Iranian goods," said Salman.

Aziz Ibrahim, director general of the Kurdish ministry of trade, agreed there could be significant economic damage.

"There are 120 Iranian firms working in different regions of Kurdistan, most of which are participating in construction projects and have signed trade contracts with Iraqi concerns," Ibrahim told AFP.

"Kurdistan is a key trading partner with Iran and a major importer of Iranian goods."

Kurdistan trade minister Mohammed Raouf estimated the value of goods crossing the border annually at one billion dollars.

Iran said it had shut the border following the detention on Thursday by US forces of Mahmudi Farhadi.

The US military charges that Farhadi is an officer in the covert operations arm of Iran's elite Revolutionary Guards, accused by American commanders of helping Shiite militias involved in Iraq's bloody sectarian conflict.

Iran has made clear that it regards Iraqi sovereignty at stake in Farhadi's continued custody, after both the regional and national authorities of Iraq said he had been visiting with their consent.

Iraqi President Jalal Talabani, himself a Kurd, on Tuesday declared the arrest of the Iranian "illegal" and again demanded his release.

"We have asked the US authorities to release the arrested man," Talabani told reporters in the northern city of Sulaimaniyah before leaving for New York for the UN General Assembly.

"Arresting a person in Kurdistan is illegal because his security file was under the jurisdiction of the provincial government," said Talabani.

The row comes as Iran intensifies its pressure on the Iraqi authorities to close the rear bases of separatist Kurdish guerrillas active in the Islamic republic's western provinces.

On Saturday, Iran confirmed for the first time that it had shelled suspected positions inside Iraq of the PJAK (Party of Free Life of Kurdistan), a rebel group linked to Turkey's outlawed Kurdistan Workers' Party (PKK).

Iraqi Interior Minister Jawad al-Bolani meanwhile arrived in Ankara on Tuesday to discuss a planned security cooperation agreement aimed at resolving the problem of Turkish Kurd rebels taking refuge in northern Iraq.

Iraq to end contractor "immunity"

Just why is "immunity" in quotes? It is as if there really were no immunity! A shooting "allegedly" involving a US firm. The shooting did involve a US firm Blackwater. The BBC is becoming FOX news across the pond. This is from the BBC.

Iraq to end contractor 'immunity'

Blackwater has the contract to guard US diplomats in Iraq
The Iraqi interior ministry has said it has drafted legislation regulating private security companies following a shooting allegedly involving a US firm.
The new code would require contractors to be subject to Iraqi law and to be monitored by the Iraqi government.

The draft is being considered by the consultative State Shura Council before being passed to parliament for debate.

The circumstances of the shooting two weeks ago, in which 11 Iraqis died, are being investigated by a US-Iraqi panel.

The contractor under suspicion, Blackwater USA, has said its guards reacted lawfully to an attack on a US diplomatic convoy.

'Impunity'

A spokesman for the Iraqi interior ministry, Maj-Gen Abdul Kareem Khalaf, said the new guidelines would cover everything to do with the operations of private security contractors.



"The companies will come under the grip of Iraqi law, will be monitored by the interior ministry and will work under its guidelines," he said.

"They will be strictly punished for any [violations] on the street."

Blackwater is the biggest private security firm operating in Iraq, with contracts including protecting the US embassy in Iraq and its diplomatic staff.

Tens of thousands of often heavily-armed security contractors work in the country.

Correspondents say their behaviour has incensed Iraqis who view them as private armies acting with impunity on their soil.

The contractors are currently granted immunity from prosecution under Iraqi law by Order 17 of the Coalition Provisional Authority - the now-defunct interim body set up by the US-led coalition in the wake of the fall of Saddam Hussein.

The agreement was extended shortly before the CPA was disbanded in June 2004.

Last week, Prime Minister Nouri Maliki called for the US government to end its contract with Blackwater immediately, although on Monday he agreed they should await the findings of the probe.

Lawmaker says Rice interfered with Iraq inquiry

This sounds like the standard sort of interference in inquiries that make it difficult for investigating agencies to get relevant data. The smoke screen of National Security can always be brought up. Sometimes it may be relevant but then who knows. The beauty of this is that the other side can bring it up whether it is relegvant or not.

Lawmaker says Rice interfered with Iraq inquiry
Tue Sep 25, 2007 6:27pm EDT

WASHINGTON (Reuters) - A leading Democratic lawmaker on Tuesday accused Secretary of State Condoleezza Rice of interfering in congressional inquiries into corruption in Iraq's government and the activities of U.S. security firm Blackwater.

Democratic Rep. Henry Waxman said State Department officials had told the Oversight and Government Reform Committee he chairs they could not provide details of corruption in Iraq's government unless the information was treated as a "state secret" and not revealed to the public.

"You are wrong to interfere with the committee's inquiry," Waxman said in a letter to Rice. "The State Department's position on this matter is ludicrous," added Waxman, a vocal opponent of the Bush administration's Iraq policies.

The State Department had no immediate comment on the letter or Waxman's allegations of interference but it has in the past dismissed the California lawmaker's comments as partisan.

Waxman said security contractor Blackwater, which was involved in an incident in which Iraqi civilians were killed last week, said they could not hand over documents relevant to an investigation without State Department approval.

"Congress has a constitutional prerogative to examine the impacts that corruption within the Iraqi ministries and the activities of Blackwater may have on the prospects for political reconciliation in Iraq," Waxman wrote to Rice.

Blackwater provides security for the U.S. Embassy in Baghdad and has a contract with the State Department.

The company was involved in a September 16 shooting in which 11 people were killed while Blackwater was escorting a convoy through Baghdad. The State Department is investigating the incident along with the Iraqis.

Waxman, who has called a hearing on Blackwater for October 2, released a letter his staff received from the security contractor's attorneys dated September 24.

"It (the State Department) directs Blackwater USA not to disclose any information concerning the contract without DOS (Department of State) preauthorization in writing."

Blackwater also urged the committee not to ask questions at the hearing that could reveal sensitive information "that could be utilized by our country's implacable enemies in Iraq."

Such information included the size of their security staff in Baghdad, weaponry and the operation of convoys.

Waxman also released a letter signed by State Department contracting officer Kiazan Moneypenny to Blackwater.

"I hereby direct Blackwater to make no disclosure of documents or information ... unless such disclosure has been authorized in writing by the contracting officer," wrote Moneypenny.

Waxman also complained Rice was refusing to testify at any hearings his committee planned to look at political reconciliation in Iraq, corruption or the Blackwater incident.



© Reuters2007All rights reserved

Isreali attack on Syria did not hit nuclear facility

Perhaps all it was after all was a test of Iran's air defences. According to Syria nothing was attacked and Israel refuses even to say anything at all. There are all these leaks to the press suggesting all sorts of scandalous things going on in Syria but none of the reports have any independent verification.
What is common to all reports is complete silence on the issue of one country attacking another sovereign country without itself being threatened with attack. Where is the outrage? Imagine if Iran attacked a US supported installation in Iraq by air. Would people write articles that merely speculated about the reasons? This is from Raw Story. When a story begins "intelligence officials say" this should send up an automatic warning signal that it is probably bogus or psyops not information.

Israeli air strike did not hit nuclear facility, intelligence officials say Larisa Alexandrovna
Published: Monday September 24, 2007









Attack said spawned from chemical weapons disaster

Israel did not strike a nuclear weapons facility in Syria on Sept. 6, instead striking a cache of North Korean missiles, current and former intelligence officials say.

American intelligence sources familiar with key events leading up to the Israeli air raid tell RAW STORY that what the Syrians actually had were North Korean No-Dong missiles, possibly located at a site in either the city of Musalmiya in the northern part of Syria or further south around the city of Hama.

While reports have alleged the US provided intelligence to Israel or that Israel shared their intelligence with the US, sources interviewed for this article believe that neither is accurate.

By most accounts of intelligence officials, both former and current, Israel and the US both were well aware of the activities of North Korea and Syria and their attempts to chemically weaponize the No-Dong missile (above right). It therefore remains unclear why an intricate story involving evidence of a Syrian nuclear weapons program and/or enriched uranium was put out to press organizations.

The North Korean missiles -- described as "legacy" by one source and "older generation" by another -- were not nuclear arms.

Vincent Cannistraro, Director of Intelligence Programs for the National Security Council under President Ronald Reagan and Chief of Operations at the Central Intelligence Agency's Counterterrorism Center under President George H. W. Bush, said Sunday that what the Israelis hit was "absolutely not a nuclear weapons facility."

"Syria has a small nuclear research facility and has had it for several years," Cannistraro said. "It is not capable of enriching uranium to weapons capability levels. Some Israelis speculated that the Syrians had succeeded in doing just that, but according to the US intelligence experts that is simply not true."

But "Syria has a chemical weapons capability and has been trying to chemically weaponize war heads on their existing stocks of North Korean originated missiles," Cannistraro added.

Israeli government and embassy officials are not commenting on the incident.

According to intelligence sources familiar with the events leading up to the raid, an explosion on July 20 at a Syrian facility near the city of Halab, in the Northern part of Syria, caused Israel's retaliatory strike on Sept. 6.

They could not say what caused the delayed reaction.

Chemical warhead exploded at site

North Korean scientists working with Syrian military and intelligence officials attempted to load a chemical warhead onto one of the North Korean missiles, likely the No-dong 1 model, according to intelligence current and former intelligence officers interviewed for this article. The result was an explosion that killed a few of those present and, according to some official reports of the blast, as many as 50 civilians.

The SANA news agency described the blast at the time as "not the result of sabotage," but an explosion resulting from "the combustion of sensitive, highly explosive material caused by extremely high temperatures."

The No-Dong 1 missile is a redesigned SCUD-C, which the Syrians are alleged to have acquired in the mid-1990s according to some estimations, while others say perhaps as late as 2000. According to the Federation of American Scientists, the No-Dong has a potential range/payload capacity of 1,000-1,300 km/700-1,000 kg.

Cannistraro believes that these missiles were No-Dong, but did not specify which class. Others, however, named the No-Dong 1 model or described the missile in such a way as to indicate what could only be the No-Dong 1 model.

The chemical explosion is believed to have included a Sarin nerve agent and made the area around the blast dangerous even after the fire from the explosion had been extinguished. This would make reconnaissance of the area difficult for foreign intelligence officers attempting to collect samples and data after the blast.

The United Nations Chemical Weapons Convention treaty of 1993 outlawed the stockpiling of Sarin, but neither Syria nor North Korea are signatories to the treaty.

Some believe that the Office of the Vice President is continuing to battle any attempts at diplomacy made by the US State Department in an effort to ensure no alternative but a military solution to destabilize and strike Iran, using Syria's alleged nuclear weapons program and close relations with Iran as a possible pretext.

A Sept. 16 piece in the London Sunday Times alleged the attack proved Israel could penetrate Iran's air defenses.

"By its actions, Israel showed it is not interested in waiting for diplomacy to work where nuclear weapons are at stake," reporter Uzi Mahnaimi wrote. "The Israelis proved they could penetrate the Syrian air defence [sic] system, which is stronger than the one protecting Iranian nuclear sites."

US sniper "bait and kill" tactics may be a war crime

This is precisely the sort of thing that will turn a population even more against the occupiers. It doesn't seem to matter. The US snubs its nose at Iraqi sovereignty every day.


U.S. sniper 'bait and kill' tactics may be a war crime David Edwards and Adam Doster
Published: Tuesday September 25, 2007


A classified program used by U.S. military snipers has come under scrutiny in recent days. The Washington Post reports that, "A Pentagon group has encouraged some U.S. military snipers in Iraq to target suspected insurgents by scattering pieces of 'bait,' such as detonation cords, plastic explosives and ammunition, and then killing Iraqis who pick up the items, according to military court documents."

The secrecy of the plan was ended during an murder investigation involving three snipers who allegedly used bait items to make shootings seem legitimate. While it's unclear whether the three alleged shootings, which took place within months of the program's implementation, were part of the classified program specifically, "defense attorneys argue that the program may have opened the door to the soldiers' actions because it blurred the legal lines of killing in a complex war zone."

In documents retrieved by The Washington Post from family members of one accused soldier, a leader of an elite sniper scout platoon said "members of the U.S. military's Asymmetric Warfare Group visited his unit in January and later passed along ammunition boxes filled with the 'drop items' to be used 'to disrupt the AIF [Anti-Iraq Forces] attempts at harming Coalition Forces and give us the upper hand in a fight.'"

The baiting program should be rigorously examined, says Eugene Fidell, the president of the National Institute of Military Justice, because it raises frightening possibilities.

"In a country that is awash in armaments and magazines and implements of war," he said, "if every time somebody picked up something that was potentially useful as a weapon, you might as well ask every Iraqi to walk around with a target on his back."

Despite the new inquiries, it is not clear whether the program was isolated to one Iraqi region or how many people were killed using the tactics.

Read the whole story here.

Letter to Columbia Spectator re Ahmadinejad speech

This is a letter to the editor of the Spectator by a grad on Bollinger's treatment of Ahmnadinejad. The author is obviously no fan of Ahmadinejad but his remarks about Bollinger seem spot on. Yet many commentators in the media do not even seem to recognise how inappropriate and totally insulting Bollinger's remarks were.

Bollinger proved himself to be a total buffoon and an embarassment to
us
all. I'm a conservative Republican, so I'd be just as happy Ahmadinejad

met the same fate as Saddam Hussein, but I also think guests should be
treated with respect and decorum once invited. Only a cad invites a man

to speak and then attacks him, saying he's the face of evil, etc.
Bollinger was clearly responding to media criticism by trying to be a
macho Tough Guy, which he's not, and he ended up with his foot in his
mouth.

Meanwhile I'm embarassed for my school and for our guest. Ahmenidejad
was right in declaring, "In Iran, we don’t think it’s necessary
before
the speech is even given, to come in with a series of claims."
Bollinger
might not respect the man or respect his views, but he ought to respect

the fact that Ahmadinejad is a world leader and official guest. And
then
there's the matter of the black backdrop for the presentation, where
usually "Columbia University - World Leaders Forum" would be written
prominently behind the speaker.

If Bollinger is going to invite a foreign dignitary to campus to speak,

Bollinger owes it to the guest that he be treated courteously and
hospitably. If Bollinger can't show proper diplomatic tact, then the
guest shouldn't be invited. Shame on Columbia, shame on Bollinger.

MBA 2006

full: http://www.columbiaspectator.com/?q=node/26934#comments

Debating Ahmadinejad at Columbia

This shows not only Bollinger's complete lack of civility to a guest but his hypocrisy on free speech. It also shows the double standards of Columbia who welcomed an actual dictator Musharraf with open arms as they had welcomed Hitler's ambassador ages ago.
It is impossible not to sense that there is a huge psyops operation in which the media especially those such as FOX and CNN gladly promote that is effectively demonising Ahmadinejad. Of course the president is really not all that powerful in Iran but there needs to be a human face placed upon EVIL and this works. The US public will be well primed for any attack on Iran.


http://www.thenation.com/doc/20071008/vora
Debating Ahmadinejad at Columbia

by JAYATI VORA

[posted online on September 25, 2007]

A tall man with white hair, wearing a US-flag print shirt and pants,
patrolled the sidewalk at 116th and Broadway. He waved a huge American
flag as he marched, in movements that were nearly metronomic in their
consistency. Stacks of brochures sat on a bare and rickety table,
waiting to be handed out to anyone who didn't look away quickly enough.
Bystanders stared.

I hadn't been back to my former school almost since I graduated.
Returning as an alumna of the School of International and Public
Affairs
(SIPA), the school that sponsored Iranian President Mahmoud
Ahmadinejad's talk here on Monday, I felt the puff of pride that
Columbia had not backed down in the face of media pressure. I also felt
just a little bit cheated that it was happening now, when I was
attending as an outsider, rather than the first time his talk had been
announced, in 2006, when I was still a sleep-deprived student.

The police officers stationed in and around the university, beginning
at
the platform of the subway that I had taken to get there, looked at
everyone suspiciously. Women in dark, severe suits monitored the entry
of the press, taking signatures and examining credentials. Everywhere,
people in uniforms directed the human traffic and at certain entrances
demanded identification. Fliers lined the walkway to the main
quadrangle
and littered the brick paths. Students milled around the campus,
talking
excitedly in tight groups or listening to the speakers outside Low
Library. Homemade placards offered silent counterpoint to some of the
speeches delivered at the podium. "Ahmadinejad Is not Iran Just Like
Bush Is not America," said one. "We Say No to War on Iran," proclaimed
another. And a third, my favorite, in black paint on a wood sheet:
"Free
Speech for All, Even Douche Bags."

Representatives of various organizations were eloquent in their
denunciation of Ahmadinejad's professed views on Israel and the
treatment of women and homosexuals in Iran, yet many supported his
right
to speak at the university. Many declared that they had never felt
prouder to be associated with Columbia. Some said that they had never
felt more ashamed.

Matteen Mokalla, an Iranian-American student at SIPA studying the
Middle
East, spoke of the mood on campus. "Before the talk, the entire campus
was electrified," he said. "Everybody was talking about it. When we
were
standing in line, we joked, 'Is this the line for the Rolling Stones?'
Because it felt like that."

But that pride and excitement was tarnished by the opening remarks of
Columbia President Lee Bollinger. In his statement, combative and
unduly
vicious, Bollinger accused his invited guest of being nothing more than
a "petty and cruel dictator," of having a "fanatical mindset." He
claimed that this exercise was valuable in knowing one's enemies and
understanding "the mind of evil."

These words were prefaced by his describing the invitation to
Ahmadinejad as the "right thing to do." As abhorrent as Bollinger's
parroting of Bushisms is, the invite was the right thing to do. Not
because the Iranian president has a right to share some of his more
odious views but because of "our right to listen. We do it for
ourselves."

But where were all these references to freedom of speech just last
year,
when Bollinger first endorsed, then rescinded, the SIPA invitation to
Ahmadinejad? Then-SIPA dean Lisa Anderson had invited the Iranian
leader
to give a lecture. Bollinger has claimed that the invitation was taken
back because he wasn't sure that the exchange would reflect the
"academic values" that the platform stood for. He also called
Ahmadinejad's views "repugnant." Campus gossip, however, put the reason
as outside pressure. What else could it have been, the whispers went,
when the university president at first endorsed Dean Anderson's invite
but backed off the next day?

That's why it was all the more disappointing when students showed up to
hear their president uphold all the values of free speech in the face
of
withering media criticism--only to hear him stoop to name-calling.

"Bollinger's remarks were uncalled for," said Julie Payne, a
second-year
SIPA student and co-editor of SIPA's student newspaper, Communique.
"There was no need for a fifteen-minute tirade, nor for using some of
the adjectives he did. Everyone disagrees with [Ahmadinejad's]
rhetoric,
but debate shouldn't be so debased by using that language." Bollinger's
opening remarks changed the nature of the discussion at Columbia. After
the talk, said Mokalla, "the discussion was not about Ahmadinejad at
all. Bollinger was outrageous. If he feels this way about him, why
invite this man? Twenty of us were talking about it for two hours
afterward. It was a bit embarrassing because he sounded like President
Bush or like a neoconservative ideologue."

Bollinger's comments were radically different from other introductions
he has given in the course of the World Leaders Forum, an annual
cluster
of talks hosted by Columbia, where visiting heads of state are invited
to address students on campus.

I remember attending a similar lecture two years ago, in the fall of
2005, in my first semester as a SIPA student. It was a talk by
Pakistani
President Pervez Musharraf, a leader closer to my home country. As one
of many Indian students at the event, I burned with questions I was
dying to pose about democracy, women's rights and peace with India.

Then, as yesterday, we arrived more than an hour in advance. On each of
our seats was a pamphlet with a brief history of the leader. I was
astonished to find that, according to his biography, Musharraf "assumed
the office of chief executive of Pakistan in October 1999." There was
no
mention of the coup through which Musharraf seized power. Not once did
Bollinger refer to the military man, who had overthrown the elected
government and then refused to hold elections as promised, as a
dictator--a word he seemed to have no problem using to describe
Ahmadinejad. The question of how Musharraf "assumed office" was
delicately avoided, a diplomatic skill that has clearly been forgotten
in these two intervening years. No one seemed curious to know how
Musharraf's rhetoric about democracy fit in with his continued reign as
a dictator--at least, no one with access to a mike.

Neither Bollinger nor the press has been so forgiving of Ahmadinejad.
He
has been attacked in all quarters--from the front pages of New York's
daily newspapers to the sidewalks outside Columbia's main gates to the
podium where he was invited to speak. He has been called "thug,"
"madman," "tyrant," "dictator" and more. And in this volley of words,
an
important opportunity was lost.

Sitting with a bunch of his Iranian friends on the lawn with the
thousands who couldn't get into the lecture hall, Bill Berkeley
professed himself disappointed with the direction of the debate. An
adjunct professor at Columbia's School of Journalism, Berkeley is the
author of a book on Rwanda and is currently at work on another on Iran.
"I didn't feel the discussion moved forward," he said.

For in the melee of questions about the Holocaust and wiping Israel off
the map, Ahmadinejad got off with mouthing generalities about loving
all
nations and admitting that the Holocaust had indeed taken place.
("Given
that the Holocaust is a present reality of our time," said the Iranian
president, "we should have research to approach this from different
perspectives.") He got a free pass on issues that many Iranians would
have liked to see raised, such as women's rights, homosexuality
(according to Ahmadinejad, homosexuals simply do not exist in Iran) and
the misdeeds of the Revolutionary Guard.

Iranian SIPA student Hani Mansourian knows what his question would have
been. "I would have asked him, 'If you support a referendum in
Palestine, and if you say that women are free in Iran, why don't you
hold a referendum in Iran and ask women whether they want to wear the
hijab or not?'" For all his evasion of questions posed to him, on some
points Ahmadinejad was eloquent and passionate. His support for the
Palestinian people dominated the speech. "For sixty years, these people
are being killed. For sixty years, on a daily basis, there's conflict
and terror. For sixty years, innocent women and children are destroyed
and killed by helicopters and airplanes that break the house over their
heads."

He was persuasive when it came to Iran's nuclear policy. Recalling the
after-effects of the atomic bomb on Hiroshima and Nagasaki, he asked,
"What can a perpetual nuclear umbrella threat achieve for the sake of
humanity?"

In this face-off between Bollinger's prefacing remarks and
Ahmadinejad's
speech, the university president "made Ahmadinejad look the winner,"
said Mansourian, "and that's not what I wanted." The Iranian, like the
rest of us, wanted a real debate, one in which Bollinger would practice
what he had preached the previous year in a campus-wide e-mail to
students.

"In a society committed to free speech," it had said, "there will
inevitably be times when speakers use words that anger, provoke, and
even cause pain. Then, more than ever, we are called on to maintain our
courage to confront bad words with better words."

Sadly, what Bollinger had in his arsenal were not better words but
Bush's words.

Juan Cole: Demonisation of Ahmadinejad

Americans seem to forget what they have done to Iran.. Bollinger hardly represents any stirling qualities of US American University Presidents. Although he resisted calls to cancel the speech he used it as an opportunity to show his patriotic credentials by insulting his guest even before he spoke. As my next post illustrates Ahmadinejad's reception should be contrasted with that of an actual dictator Musharaff. He was welcomed with open arms, as was Hitler's ambassador many years ago.

Turning Ahmadinejad into public enemy No. 1
Demonizing the Iranian president and making his visit to New York seem controversial are all part of the neoconservative push for yet another war.

By Juan Cole



Sept. 24, 2007 | Iranian President Mahmoud Ahmadinejad's visit to New York to address the United Nations General Assembly has become a media circus. But the controversy does not stem from the reasons usually cited.

The media has focused on debating whether he should be allowed to speak at Columbia University on Monday, or whether his request to visit Ground Zero, the site of the Sept. 11 attack in lower Manhattan, should have been honored. His request was rejected, even though Iran expressed sympathy with the United States in the aftermath of those attacks and Iranians held candlelight vigils for the victims. Iran felt that it and other Shiite populations had also suffered at the hands of al-Qaida, and that there might now be an opportunity for a new opening to the United States.

Instead, the U.S. State Department denounced Ahmadinejad as himself little more than a terrorist. Critics have also cited his statements about the Holocaust or his hopes that the Israeli state will collapse. He has been depicted as a Hitler figure intent on killing Israeli Jews, even though he is not commander in chief of the Iranian armed forces, has never invaded any other country, denies he is an anti-Semite, has never called for any Israeli civilians to be killed, and allows Iran's 20,000 Jews to have representation in Parliament.

There is, in fact, remarkably little substance to the debates now raging in the United States about Ahmadinejad. His quirky personality, penchant for outrageous one-liners, and combative populism are hardly serious concerns for foreign policy. Taking potshots at a bantam cock of a populist like Ahmadinejad is actually a way of expressing another, deeper anxiety: fear of Iran's rising position as a regional power and its challenge to the American and Israeli status quo. The real reason his visit is controversial is that the American right has decided the United States needs to go to war against Iran. Ahmadinejad is therefore being configured as an enemy head of state.

The neoconservatives are even claiming that the United States has been at war with Iran since 1979. As Glenn Greenwald points out, this assertion is absurd. In the '80s, the Reagan administration sold substantial numbers of arms to Iran. Some of those beating the war drums most loudly now, like think-tank rat Michael Ledeen, were middlemen in the Reagan administration's unconstitutional weapons sales to Tehran. The sales would have been a form of treason if in fact the United States had been at war with Iran at that time, so Ledeen is apparently accusing himself of treason.

But the right has decided it is at war with Iran, so a routine visit by Iran's ceremonial president to the U.N. General Assembly has generated sparks. The foremost cheerleader for such a view in Congress is Sen. Joseph Lieberman, I-Conn., who recently pressed Gen. David Petraeus on the desirability of bombing Iran in order to forestall weapons smuggling into Iraq from that country (thus cleverly using one war of choice to foment another).

American hawks are beating the war drums loudly because they are increasingly frustrated with the course of events. They are unsatisfied with the lack of enthusiasm among the Europeans and at the United Nations for impeding Tehran's nuclear energy research program. While the Bush administration insists that the program aims at producing a bomb, the Iranian state maintains that it is for peaceful energy purposes. Washington wants tighter sanctions on Iran at the United Nations but is unlikely to get them in the short term because of Russian and Chinese reluctance. The Bush administration may attempt to create a "coalition of the willing" of Iran boycotters outside the U.N. framework.

Washington is also unhappy with Mohammad ElBaradei, head of the International Atomic Energy Agency. He has been unable to find credible evidence that Iran has a weapons program, and he told Italian television this week, "Iran does not constitute a certain and immediate threat for the international community." He stressed that no evidence had been found for underground production sites or hidden radioactive substances, and he urged a three-month waiting period before the U.N. Security Council drew negative conclusions.

ElBaradei intervened to call for calm after French Foreign Minister Bernard Kouchner said last week that if the negotiations over Iran's nuclear research program were unsuccessful, it could lead to war. Kouchner later clarified that he was not calling for an attack on Iran, but his remarks appear to have been taken seriously in Tehran.

Kouchner made the remarks after there had already been substantial speculation in the U.S. press that impatient hawks around U.S. Vice President Dick Cheney were seeking a pretext for a U.S. attack on Iran. Steven Clemons of the New America Foundation probably correctly concluded in Salon last week that President Bush himself has for now decided against launching a war on Iran. But Clemons worries that Cheney and the neoconservatives, with their Israeli allies, are perfectly capable of setting up a provocation that would lead willy-nilly to war.

David Wurmser, until recently a key Cheney advisor on Middle East affairs and the coauthor of the infamous 1996 white paper that urged an Iraq war, revealed to his circle that Cheney had contemplated having Israel strike at Iranian nuclear research facilities and then using the Iranian reaction as a pretext for a U.S. war on that country. Prominent and well-connected Afghanistan specialist Barnett Rubin also revealed that he was told by an administration insider that there would be an "Iran war rollout" by the Cheneyites this fall.

House demand slumps in August in US.

The housing credit crunch seems not to be over given these statistics. At one and the same time prices are falling and also sales, not a hopeful sign.

NEWS ALERT
from The Wall Street Journal

Sept. 25, 2007

Demand for previously owned homes tumbled in August to the lowest
level in five years as mortgage-market troubles hurt sales. Home
resales fell to a 5.5 million annual rate, a 4.3% decline from July,
the National Association of Realtors said. In a separate report, the
S&P/Case-Shiller index showed the decline in U.S. home prices
accelerated nationwide in July, posting the steepest drop in 16 years.

FOR MORE INFORMATION, see: http://online.wsj.com/article/
SB119072589181638646.html?mod=djemalert

Senate votes on dividing Iraq

This is just reported by AFP (Agency France Press) as if it were the most natural thing in the world should be that one sovereign country the US should debate whether another sovereign country, Iraq, should be divided up into three!
What this makes obvious is that in spite of talk of Iraqi sovereignty it is taken by granted by the US that it can decide whether or not it should be divided into three!
As it happens events on the ground in Iraq may ultimately result in three separate countries or a hopelessly weak central government no matter what the US senate decides.


Senate to vote on Iraq division plan by Stephen Collinson
Mon Sep 24, 4:11 PM ET



WASHINGTON (AFP) - The US Senate is expected to vote as early as Tuesday on a Bosnia-style plan to subdivide Iraq on ethnic lines, touted by backers as the sole hope of forging a federal state out of sectarian strife.

ADVERTISEMENT

Though the measure is non-binding, and would not force a change in President George W. Bush's war strategy even if it passes, the vote will provide a key test of an idea drawing rising interest in Washington.

Advocates say the plan, championed by Democratic senator and presidential hopeful Joseph Biden, offers a route to a political solution in Iraq that could allow US troops to eventually go home without leaving chaos behind.

A loose autonomous federation of Kurdish, Shiite and Sunni entities might look good on paper, but critics charge it ignores Iraq's ethnic stew, such as cities where ethnic groups live side-by-side and inter-marry, and are not divided by lines on a map.

"Critics have come along and said 'I don't like your plan,'" Biden said, adding: "if you don't like Biden's proposal, what is your idea?"

The plan, drawn up with former Carter administration foreign policy expert Leslie Gelb, would provide for a federal system as permitted by Iraq's constitution, stop Iraq from becoming a failed state and:

- Separate Iraq into Kurdish, Shiite and Sunni entities, with a federal government in Baghdad in charge of border security and oil revenues.

- Aim to defuse sectarian violence by offering Sunnis a share of oil revenues.

- Boost reconstruction aid and debt relief.

- Launch an international diplomatic effort to rally the world's great powers and Iraq's neighbors to the new federation's cause.

The plan, offered as an amendment to a defense policy bill, already has achieved what many other Iraq war measures have failed to do: attract support from across the political chasm carved in Washington by the war.

Several Republicans, who back Bush's troop surge strategy, but bemoan political deadlock in Baghdad, have signed on.

"We have a flawed political design that we are pushing currently in Baghdad," said Republican presidential longshot Senator Sam Brownback, one of 11 co-sponsors of the bill.

Republican Senator Kay Bailey Hutchison looked for inspiration to the Dayton Peace Accords which led to the creation of a semi-autonomous Muslim-Croat federation and a Bosnian Serb Republic.

"I think what we have seen in Bosnia is a lessening of tensions when there is a capability for the security forces, the educational and the religious sects to have their own ability to govern within themselves," she said.

Critics, who have included the White House, have argued Biden plan is a recipe for more chaos in Iraq.

US ally Turkey would oppose such an initiative, fearful of unrest among its Kurdish population, they say, adding that a partitioned Iraq would lead outside powers like Iran and Saudi Arabia to bolster rival ethnic militia.

Other critics say frontier drawing in the Middle East by western powers has caused enough historical heartache, and it should be up to Iraqis to shape their future.

Some also say that partitioning Iraq, even if Baghdad remains whole, could encourage ethnic cleansing.

US ambassador to Baghdad Ryan Crocker backed devolving of power to Iraqi regions, but opposed a formal partition during an appearance in Congress this month.

"Baghdad, in spite of all of the violence it has seen and all of the population displacements, remains a very mixed city, Sunnis and Shia together," Crocker said.

"Any notion that that city of over five million people can be neatly divided up or painlessly cleansed of a huge number of people is just incorrect."

The bipartisan Iraq Study Group, which delivered recommendations in December warned partition could trigger mass population flows, the collapse of the fragile Iraqi security forces and ethnic cleansing by strengthened militias.

But Biden argued that all other options have failed, and says Iraq's ethnic groups are already separating.

"President Bush, and many Democrats continue to cling to choice number one," he said in a campaign mailing to supporters at the weekend, arguing US troops could not "build or force unity where none exists."

Ahmadinejad hailed in Middle East

What is a bit surprising is that Ahmadinejad is popular even among Sunnis throughout much of the Middle East. His opposition to the West and willingness to stand up against Western pressure and also his defence of Islam transcend sectarian divisions it seems.
Media attempts to demonise Ahmadinejad in the West and some of his own pronouncements assure that he is dmaned by liberals and conservatives alike in the US.

Ahmadinejad hailed in Middle East

The president of Iran, who has made a point of defying the West and Israel, has won admiration even among Sunni nations.
By Jeffrey Fleishman, Los Angeles Times Staff Writer
September 24, 2007
CAIRO — Iranian President Mahmoud Ahmadinejad, a flinty populist in a zip-up jacket whose scathing rhetoric and defiance of Washington are often caricatured in the Western media, has transcended national and religious divides to become a folk hero across the Middle East.

The diminutive, at times inscrutable, president is a wellspring of stinging sound-bites and swagger for Muslims who complain that their leaders are too beholden to or frightened of the Bush administration. Ahmadinejad, who arrived in New York Sunday ahead of a U.N. General Assembly meeting, is an easily marketable commodity:a streetwise politician with nuclear ambitions and an open microphone.

"I like him a lot," said Mahmoud Ali, a medical student in Cairo. "He's trying to protect himself and his nation from the dangers around him. He makes me feel proud. He's a symbol of Islam. He seems the only person capable of taking a stand against Israel and the West. Unfortunately, Egypt has gotten too comfortable with Washington."

Ahmadinejad's appeal is especially strong in Egypt, where he is compared to the late President Gamal Abdel Nasser, whose bold, yet doomed vision of pan-Arabism in the 1950s was also aimed at stemming Western influence. In the minds of many Egyptians, Iran's quest to expand its nuclear program despite United Nations sanctions is similar to Nasser's confrontation with the British and French over nationalizing the Suez Canal.

What's striking in Ahmadinejad's case, however, is that the leader of a non-Arab Shiite nation has ingratiated himself with the Middle East's predominantly Sunni Arab population.

In praising the Iranian president, Arabs quickly navigate around historical religious animosities and present-day fears that Iran is undermining Sunnis in Iraq and elsewhere. They prefer to speak of how Ahmadinejad is a rallying voice for Islam at a time the region is bewildered by its powerlessness to fix Iraq, Lebanon and the Israeli-Palestinian conflict.

"He's a brave man," said Tayseer Ibrahim, an employee of the Egyptian Education Ministry, who was hurrying toward the subway the other day. "He's standing up to the U.S. He could have been intimidated after what happened to Saddam Hussein in Iraq, but he's not. The Iranian people must love him a lot. Hopefully, our Arab leaders will see that you can defy the West and nothing will happen to you."

Munther Farrah, who sells nuts and chocolates in Amman, the Jordanian capital, said he and other Sunnis are troubled by Iran's Shiite theocracy. "But Ahmadinejad is still liked," he said. "We are with him as long as he's against Israel and the U.S."

The passions are decidedly different in New York, where Ahmadinejad is scheduled to address the U.N. on Tuesday in an effort to block another round of sanctions over Tehran's nuclear program. Some American politicians have said the Iranian president should be turned away. Public pressure has forced him to cancel a visit to Ground Zero.

His U.N. appearance comes as Iran, which the U.S. regards as a state sponsor of terrorism, balances two diplomatic tracks: It has moved to soften international criticism of its human rights record by allowing three Iranian American academics and writers accused of spying to leave the country. On the other hand, it has intensified its defiance of the U.S. and Europe after the French foreign minister suggested that the world prepare for the possibility of war between Western nations and Iran.

The static of threats and counter-threats has enhanced Ahmadinejad's brand of populism, which stands in vivid contrast to the detached styles of Egyptian President Hosni Mubarak, King Abdullah II of Jordan and King Abdullah of Saudi Arabia. All three U.S. allies regard Iran as a dangerous enemy, most notably over Tehran's support of the militant groups Hezbollah in Lebanon and Hamas in the Gaza Strip. But they have also borrowed a bit from Ahmadinejad's script by criticizing Bush administration policies and the bloodshed in Iraq.

The governments in Egypt, Jordan and Saudi Arabia have undercut media freedom and suppressed political dissent, and are viewed by some of their people as corrupt and ineffectual in addressing economic and social problems. Iran runs its own version of the omnipresent, repressive state, but Ahmadinejad's intense distrust of the U.S. and hatred of Israel have elevated him to mythical status for the frustrated Arab mechanic, taxi driver or lawyer seeking a pure, forceful message.

The sentiment is similar to the respect won by Hezbollah, which fought a war with Israel in 2006, and Hamas, the radical Palestinian party that seized control of the Gaza Strip in June. Both were credited with tenacity and portrayed as underdogs battling against larger enemies. This type of resolve, along with Iran's pride as a sovereign state, echoes through Ahmadinejad's speeches and asides.

"It is more of a scream that reflects the incapacity of both the Arab regimes and Arab peoples to achieve anything on the regional level," said Nabil Abdel Fattah, a political analyst with Al Ahram Center for Political and Strategic Studies in Cairo.

Ahmed Taher, an Egyptian doctor, credits Ahmadinejad for pursuing nuclear technology, which Tehran says is for civilian use, but the U.S. suspects is for weapons.

"It's beyond doubt that Ahmadinejad's popularity surpasses any other leader in the Middle East," Taher said. "We shouldn't blame him for seeking nuclear weapons. Israel has them. It will be more balance for Muslims if we have them too. Israel is much more dangerous to the world than Ahmadinejad."

Some of the Iranian president's admirers, however, are concerned about his provocative nature, bellicose quips and coyness about Iran's nuclear intentions. Comparisons to Nasser's triumphs and defeats limn the edge of conversation about the Iranian leader: Nasser was victorious in the Suez crisis, but a decade later his miscalculations led to humiliating Arab defeat by Israel in the 1967 Middle East War.

"He's too audacious and this hurts him," said Reda Kheshein, an accountant scanning headlines at a newsstand in Tahrir Square in Cairo. "He doesn't have the right to say he wants to destroy Israel. He needs to be reasonable, not risky. Unfortunately, we suffered from riskiness in the past. Look at Nasser, he made a very risky decisions. We don't need any more martyrs."

Other Arabs wonder about Ahmadinejad's strategy in a region where political theater and hyperbole often mask quieter, behind-the-scenes diplomacy. They suggest that the Iranian president, who seldom displays shades of nuance and is given wide latitude by Iran's ruling religious establishment, is as spooky as he is inspiring.

"He has a sense of belonging to the Muslim world. He always stands by Muslim nations," said Hussein Ali, a guide waiting for a bus. "But I don't like his inability to unify his own people and his insistence on developing nuclear capabilities that would be dangerous to the whole world. But we need his strong Islamic voice to protect us from the West."

Ibrahim Sufa, a Jordanian shop owner, said Ahmadinejad is shrewd and calculating when it comes to spin.

"He's good. I feel he's really a moderate. He talks in the extreme, but he acts with restraint," Sufa said. "If America hits him, the whole region will go on fire."

jeffrey.fleishman@latimes.com

Noha El-Hennawy of The Times' Cairo Bureau and special correspondent Ranya Kadri in Jordan contributed to this report.



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Bush the new Saddam

This is the cover story for the October MacLeans, one of the largest Canadian magazines. I have reprinted only a small portion but the rest is at the MacLean's website. No doubt the cover and cover story will raise some eyebrows and hackles in the US.
The author is certainly correct that Bush is reaching out to Saddam's old henchmen something that seems to be a bit lost on many commentators. A second important point is also made by Graham and that is that for Saddam Iran was also the great danger to Iraq and this is the line Bush is pursuing.
The whole policy is completely contradictory. On the one hand creating any sort of democracy in Iraq will bring the Shia to power particularly in the south and as a minority the Sunni will tend to be marginalised or certainly have much less power than under Hussein. On the other hand, to help the Sunni's--because they are now willing to take on Al Qaeda in Iraq--gives them more power. The Shia will no doubt see this renewed power of the Sunnis as a threat and they will be even more inclined to retain their militias and seek support from Iran. The result will be almost certainly increased sectarian warfare. If the US sides with the Shia dominated government the alliance with the Sunnis may turn sour immediately. In fact there is no evidence that there is any friendlier attitude to the US even now among the Sunnis.


How George Bush became the new Saddam
COVER STORY: Its strategies shattered, a desperate Washington is reaching out to the late dictator's henchmen.
Patrick Graham | Sep 20, 2007 | 10:04 am EST

It was embarrassing putting my flak jacket on backwards and sideways, but in the darkness of the Baghdad airport car park I couldn’t see anything. “Peterik, put the flak jacket on,” the South African security contractor was saying politely, impatiently. “You know the procedure if we are attacked.”

I didn’t. He explained. One of the chase vehicles would pull up beside us and someone would drag me out of the armoured car, away from the firing. If both drivers were unconscious—nice euphemism—he said I should try to run to the nearest army checkpoint. If the checkpoint was American, things might work out if they didn’t shoot first. If it was Iraqi . . . he didn’t elaborate.

Arriving in Baghdad has always been a little weird. Under Saddam Hussein it was like going into an orderly morgue; when he ran off after the U.S.-led invasion of March 2003 put an end to his Baathist party regime, the city became a chaotic mess. I lived in Iraq for almost two years, but after three years away I wasn’t quite ready for just how deserted and worn down the place seemed in the early evening. It was as if some kind of mildew was slowly rotting away at the edges of things, breaking down the city into urban compost.
Since 2003, more than 3,775 U.S. troops have been killed in Iraq, while nearly 7,500 Iraqi policemen and soldiers have died. For Iraq’s civilian population, the carnage has been almost incalculable. Last year alone, the UN estimated that 34,500 civilians were killed and more than 36,000 wounded; other estimates are much higher. As the country’s ethnic divisions widen, especially between Iraq’s Arab Shia and Arab Sunni Muslims (the Kurds are the third major group), some two million people have been internally displaced, with another two million fleeing their homeland altogether. Entering Baghdad I could tell the Sunni neighbourhoods, ghettos really, by the blasts in the walls and the emptiness, courtesy of sectarian cleansing by the majority Shias. The side streets of the Shia districts seemed to have a little more life to them.
Continued Below


As soon as I arrived, I tried calling old acquaintances. Many of these were from Falluja and Ramadi, and had once been connected to the insurgency that had raged across the Sunni Arab province of Anbar since 2003. In the past few years, though, many in the insurgency had become disillusioned with the direction of the anti-occupation fight—and concerned over the future of Arab Sunnis in Iraq. In Anbar, the terrorist group al-Qaeda in Iraq, initially a partner in the Sunni insurgency, had alienated many by trying to overthrow traditional tribal and power structures to impose an alien interpretation of Islam, a Salafist fundamentalism that had few adherents before the arrival of the Americans. In Baghdad, the militias supporting the Shia-dominated central government—in effect a sectarian regime—were cleansing Arab Sunni neighbourhoods. Now, Anbari Sunnis view the government as deeply infiltrated by their traditional enemy, Shia Iran. So with few allies left in Iraq, they began allying themselves with their former enemies, the U.S. Army—which also seems to be running out of friends.

This “Anbar Awakening” has been a slow process, beginning long before the recent U.S. “surge” that increased the number of American troops in Iraq by 30,000, to 180,000. But it is still a shaky union, a desperate marriage of convenience based on shared enemies: Iran, and the Sunnis’ former-friend-turned-foe al-Qaeda. Many of America’s new allies are former insurgents and Saddam Hussein loyalists (Saddam was a Sunni) who only a short while ago were routinely called terrorists, “anti-Iraqi fighters,” and “Baathist dead-enders.” They are suspicious of one another and strongly anti-American, although willing to work, for the moment, with the U.S. The leader and founder of the Anbar Awakening Council, Sheik Abdul-Sattar Abu Risha, was recently killed by a roadside bomb outside his house in Ramadi, clearly an inside job of some kind for which al-Qaeda claimed credit. Only 10 days earlier, Abu Risha had met with George W. Bush during the President’s visit to Iraq, the photo op of death, apparently.

I kept phoning Iraqis but few answered. When I told a friend in Baghdad that no one was taking my calls, he suggested that people didn’t answer unknown numbers because they were afraid of threats. Apparently, according to Arab custom, if you warn your victim before an attack, it’s not a crime. Perhaps—but you can read too much ancient custom into Iraq. My suspicion was that they were dead. My hope was that they were avoiding embarrassing calls from girlfriends when they were with their wives. Iraqis’ love lives can be as complicated as their politics.

When I finally got through to one friend, he was in Damascus, along with several million of his countrymen. “Come to Falluja,” Ahmed said. “You can kill al-Qaeda with my troop.” It wasn’t clear how I was supposed to get to Falluja from Baghdad, although it is only 50 km west of the capital. Ahmed wasn’t sure it was a good idea to try. Passing through Abu Ghraib, a large suburban area outside the capital where Saddam and then the Americans ran a notorious prison, could be a real problem, he said. There, both insurgents and Shia militias often set up checkpoints and kidnap travellers. The Americans, mind you, have a more optimistic view of the Abu Ghraib situation. A few weeks later, I would watch Ambassador Ryan Crocker tell Congress of a real milestone in co-operation between former Sunni insurgents and their enemies in the Shia-dominated administration: over 1,700 Sunni tribesmen in Abu Ghraib were officially hired by the government as security forces. Ambassador Crocker may have been accurate—it’s just that the positive steps happening in Iraq shouldn’t be called milestones. They are more like yard-pebbles. Or even inch-dust.

“Come to Damascus—we can drive from here and the road is safe,” Ahmed said. He listed the various tribal militias controlling the 450-km road through Anbar province from the Syrian border to Falluja that could protect us. It seemed to be typical of the recent over-hyped success of the Anbar Awakening that you would have to fly from Baghdad to Damascus, and then drive six hours back across the desert, to get only 40 minutes outside Baghdad in order to see it for yourself (you could go with the U.S. Army as well, but you learn mostly about Americans if you are with Americans and end up sounding like a visiting columnist for the New York Times). Ahmed said that when he and his “troop” (his quaint word for what sounded death-squadish to me) captured al-Qaeda fighters around Falluja, they shipped the leaders to the border for interrogation by Syrian intelligence. So far, he’d sent 12. You can’t blame him—even the Americans send suspects to Syria when they want them tortured. Just ask Maher Arar.

Columbia Invited Hitler to the University

Many protesters at Columbia complained that inviting Ahmadinejad was like inviting Hitler to speak. Hitler did not speak but Hans Luther the German Ambassador to the US did speak. Notice the difference. The German speaker was welcomed warmly with open arms. In fact there was a continuing student exchange with Germany for years in the thirties. But there is no comparison of the situation now. Iran is not threatening world domination. There is no student exchanges or friendly relations between the US and Iran. In fact of course the US did not join the battle against Fascism until Japan bombed Pearl Harbour.
Whoever looked up this stuff obviously thinks that there is some similarity between the events but there are more differences, differences that apparently escape the authors. The real Nazis were welcomed by Columbia. Ahmadinejad is a radical Islamist and not a Nazi at all but he is called one because the term is a catchall pejorative term that is used to create negative attitudes to someone. By the way Nazi Germany in the thirties was certainly not an enemy of the United States.This is extracted from this site.
Columbia University Cozied up to Hitler and Nazis in the 1930s

It turns out that Columbia University has a long history of antisemitism and aligning itself with the enemies of the United States. Seventy years ago the University made headlines by inviting Adolf Hitler to speak at the University.

Columbia Invites Hitler to Campus

Seventy years before this week’s invitation to Iranian president Mahmoud Ahmadinejad, Columbia rolled out the red carpet for a senior official of Adolf Hitler’s regime. The invitation to Iran’s leader may seem less surprising, but no less disturbing, when one recalls that in 1933, Columbia president Nicholas Murray Butler invited Nazi Germany’s ambassador to the United States, Hans Luther, to speak on campus, and also hosted a reception for him. Luther represented “the government of a friendly people,” Butler insisted. He was “entitled to be received … with the greatest courtesy and respect.” Ambassador Luther’s speech focused on what he characterized as Hitler’s peaceful intentions. Students who criticized the Luther invitation were derided as “ill-mannered children” by the director of Columbia’s Institute of Arts and Sciences.

Columbia also insisted on maintaining friendly relations with Nazi-controlled German universities. While Williams College terminated its program of student exchanges with Nazi Germany, Columbia and other universities declined to do likewise. Columbia refused to pull out even after a German official candidly asserted that his country’s students were being sent abroad to serve as “political soldiers of the Reich.”

In 1936, the Columbia administration announced it would send a delegate to Nazi Germany to take part in the 550th anniversary celebration of the University of Heidelberg. This, despite the fact that Heidelberg already had been purged of Jewish faculty members, instituted a Nazi curriculum, and hosted a burning of books by Jewish authors. Prof. Arthur Remy, who served as Columbia’s delegate to the Heidelberg event, later remarked that the reception at which chief book-burner Josef Goebbels presided was “very enjoyable.”

Did you read that? That’s outrageous. I suppose the effete elite was as deranged then as they are now. They still don’t understand the realities of the world. Columbia sent a delegate to an anniversary celebration at the University of Heidelberg even after that institution had been purged of Jewish faculty members, instituted a Nazi curriculum and burned the books of Jewish authors. The Columbia University delegate enjoyed the company of Josef Goebbels.

Ahmadinejad Seeks to Soothe Critics

The mood was quite hostile. As Ahmadinejad remarked it was a bit inappropriate to put it mildly for the president of Columbia University "welcoming him" by excoriating his own and Iran's human rights record etc. For his part Ahmadinejad was rather low key and did not use any fiery rhetoric about the Great Satan. He might as well have for all the effect his moderate tone achieved.
He shares some common features with Bush. Both sometimes find it difficult to accept obvious facts. Bush that the war in Iraq was wrong and is a disaster, and Ahmadinejad that there are homosexuals in Iraq, and that there really is no doubt there was a Holocaust.

Ahmadinejad Seeks to Soothe Critics
By JOHN DANISZEWSKI and NICOLAS B. TATRO – 1 hour ago

NEW YORK (AP) — In his outward persona at least, Iranian President Mahmoud Ahmadinejad came to this country to lessen hostility toward himself and to defend Iran, not to rabble-rouse and provoke hatred. Whether he succeeded remains an open question.

In an interview with The Associated Press on Monday, Ahmadinejad presented his country as a reasonable seeker of peace and justice. He denied that it holds any violent intentions against the United States, Israel or any of its immediate neighbors.

"We seek detente," Ahmadinejad declared. "Every stance and position has been toward peace."

He also denied all the chief accusations against Iran: that it is providing weapons to kill U.S. troops in Iraq and Afghanistan, supporting terrorism or breaking international law by developing nuclear weapons.

As with any world leader, Ahmadinejad's words cannot just be accepted at face value. Leaders are judged by their actions more than their interviews.

Given the Iranian government's record: taking U.S. hostages in 1979, supporting Hezbollah in Lebanon, hosting demonstrations with chants of "Death to America," more recent arrests of intellectuals, and Ahmadinejad's own questioning of the Holocaust, he faced a hard task softening his country's image.

Clearly, however, he was making a bid in the interview — as in his other appearances — to introduce himself as a rational leader, not as the dangerous, hardline radical that he is often perceived to be by many in this country.

The problems in the Middle East, including Iraq, Palestine and Lebanon, can be solved through dialogue, good will and free elections, Ahmadinejad said. Talks with the United States will be fruitful, he said, if both sides are honest and serious.

He appeared to rule out a first-strike against Israel by Iran, and said he does not really believe that the United States would try to mount a war. He said such talk was just pre-electoral rhetoric and U.S. anger speaking.

There was notably no bashing of the "Great Satan" in the interview, and he was also somewhat muted in his discussion of Israel, although he always referred to it as "the Zionist regime" rather than by its name.

The most aggressive things he said were that Israel believes in "expansionist policies," demonstrated most recently by a Sept. 6 attack against Syria, and that U.S. actions in Iraq had been "misguided" and all about oil. He also suggested that U.S. support for Saddam Hussein back in the 1980s caused the devastating 1980-88 war between Iraq and Iran.

On the nuclear issue, he said the problems between Iran and some Western countries are strictly political, and that most of the world believes that Iran has the legal right to nuclear technology for civilian purposes.

The United States and key European nations have been pushing for new sanctions against Iran for refusing to suspend uranium enrichment. Iran insists the program is for peaceful civilian energy production but the U.S. and its allies fear it is a cover to produce nuclear weapons.

Ahmadinejad said that the International Atomic Energy Agency is responsible for nuclear issues and already has been inspecting Iranian nuclear facilities on an ongoing basis.

"So we believe that the only way is for us to continue our constructive cooperation and relations with the IAEA, something that has been in place from the start, and if these powers stop interfering, there's really no problem."

Ahmadinejad spoke to the AP just a few hours before he walked into the lion's den of a Columbia University forum as thousands of people protested outside. That meeting did not turn out well for him: he was excoriated by the university president in opening remarks and laughed at when he asserted that there is no homosexuality in Iran.

He started out the interview saying he had no "special feelings" about being among most sought-after leaders at the U.N. General Assembly. But he said he was happy to have the chance in the United States to meet with "many friends."

He said Iran's main foreign-policy aims are "peace and viable security for the whole world."

"Iran will not attack any country," he answered, when asked if his country would ever strike first against Israel. Iran has always maintained a defensive policy, not an offensive one, he said, and has "never sought to expand its territory."

He also pooh-poohed reports that the U.S. was prepared for military action if diplomatic efforts to get Iran to abandon nuclear enrichment activities failed.

"I believe that some of the talk in this regard arises first of all from anger. Secondly, it serves the electoral purposes domestically in this country. Third, it serves as a cover for policy failures over Iraq."

U.S. military officials insist they have evidence that Iran is providing weapons and training to militants in Iraq, particularly explosively formed penetrators, or EFPs, armor-piercing roadside bombs that have killed hundreds of American troops in recent months. Ahmadinejad said it is not so.

"Why would we want to do that?" he declared. "This would really be inappropriate for us. We are friends with both Iraq and Afghanistan. Insecurity in Iraq and Afghanistan undermines our own national security; it basically goes against what we believe."

Rather, he described himself as "extremely unhappy" with the situation and that he rues all the people dying in those countries.

"It saddens us that people lose their lives in Iraq. We also regret that American troops are losing their lives there," he said.

Ahmadinejad urged the United States "to change its path altogether" in Iraq and let the elected government run the country without outside interference.

Ahmadinejad claimed Iran already has made proposals to U.S. politicians over Iraq, Lebanon and Palestine that are all based on seeking peace in the region. "But we believe that for these to succeed we need two conditions in place: first, seriousness, and second, honesty and sincerity. If the two go hand-in-hand then the results can be effective," he said.

Does he believe there is seriousness and honesty from the U.S.?

"We have to wait — we hope," he answered.

Asked if he'd meet any U.S. officials while here, Ahmadinejad smiled and said it was not foreseen. "Anything is possible."

"I have suggested that I debate President Bush. I think that the United Nations provides a suitable forum for this. All of the heads of state can sit down. The world can watch for itself, independently. We will offer our proposals for resolving world problems and restoring peace, and allow everyone to think for themselves and decide which one is right."

It was, of course, an extremely unlikely suggestion.

AP writer Edith M. Lederer at the United Nations contributed to this report

Iran closes border with Kurdistan to protest US seizure of Iranian

The US may be able to ignore Iraq's protests but Iran is able to cause real economic hardship by closing the border and the United States has only itself to blame.

BAGHDAD, Iraq (CNN) -- Iran has closed its five entry points with Iraq's Kurdish region in protest against the U.S. military's recent incarceration of an Iranian, an Iraqi Kurdish official said Monday.


Iraqi President Jalal Talabani has called for the release of an Iranian detained by the U.S. military.

One Iraqi official said the move will hurt the economy of the autonomous region, where there is heavy traffic over the Iraq-Iran border.

Jamal Abdullah, the official spokesman of Iraq's Kurdistan regional government, said Iran made good on its threat to close the border because the Iranian, Mahmoody Farhadi, had not been released. One of the entry points is in Irbil, two are in Sulaimaniya and two others are in Khanaqin.

American troops arrested the man Thursday in Sulaimaniya, said the U.S. military, which called him a member of the Iranian Islamic Revolutionary Guards Corps' Quds Force. The agency has been accused of training and equipping insurgents in Iraq.

The detainee -- one of several Iranians in U.S. custody in Iraq -- "has been involved in transporting improvised explosive devices and explosively formed penetrators into Iraq. Intelligence reports also indicate he was involved in the infiltration and training of foreign terrorists in Iraq."

Iraqi president urges release of Iranian detainee
But Iraqi President Jalal Talabani -- who blasted the United States for the arrest -- said the Iranian official is a civil servant who was on an official trade mission in the Kurdistan region.

The closures would cause "severe damage to markets and trade in the province on this blessed month," Talabani said, referring to Ramadan. He called for the Iranian's release.

The other border points between Iraq and Iran remain open.

Paul Krugman: Two sample articles

Here are two samples from Paul Krugman's blogs at the NY Times. They are now available to us all free. Good stuff very often. Krugman is spot on about the Petraeus coverage and exactly the same fits much coverage. The same thing happens in Canada. A recent national TV coverage on an Ontario election debate focused solely on body language and other aspects of the presentation. Policies were not even mentioned. Performance was based purlely on factors other than content. The blog site is here.

September 20, 2007, 11:26 pm
Is This the Wile E. Coyote Moment?
Lots of buzz suddenly about the possibility of a sharp fall in the dollar. The Canadian dollar is back at parity with the greenback; there are rumors that the Saudis are planning to diversify into euros, and maybe even that the Chinese might break the dollar peg. A nice summary at Barry Ritholtz’s blog The Big Picture.
I could say that I saw this coming; the problem is that I’ve been seeing it coming for several years, and it keeps not arriving (and I don’t know if this is really it, even now.) The argument I and others have made is that the U.S. trade deficit is, fundamentally, not sustainable in the long run, which means that sooner or later the dollar has to decline a lot. But international investors have been buying U.S. bonds at real interest rates barely higher than those offered in euros or yen — in effect, they’ve been betting that the dollar won’t ever decline.
So, according to the story, one of these days there will be a Wile E. Coyote moment for the dollar: the moment when the cartoon character, who has run off a cliff, looks down and realizes that he’s standing on thin air – and plunges. In this case, investors suddenly realize that Stein’s Law applies — “If something cannot go on forever, it will stop” – and they realize they need to get out of dollars, causing the currency to plunge. Maybe the dollar’s Wile E. Coyote moment has arrived – although, again, I’ve been wrong about this so far.
Much more about all this in a thoroughly incomprehensible paper I recently published in the European journal Economic Policy. Don’t bother clicking if you hate funny diagrams and Greek letters.

September 19, 2007, 9:43 pm
What I Hate About Political Coverage
Warning: this is a bit (actually, more than a bit) of a rant.
One of my pet peeves about political reporting is the fact that some of my journalistic colleagues seem to want to be in another business – namely, theater criticism. Instead of telling us what candidates are actually saying – and whether it’s true or false, sensible or silly – they tell us how it went over, and how they think it affects the horse race. During the 2004 campaign I went through two months’ worth of TV news from the major broadcast and cable networks to see what voters had been told about the Bush and Kerry health care plans; what I found, and wrote about, were several stories on how the plans were playing, but not one story about what was actually in the plans.
There are two big problems with this kind of reporting. The important problem is that it fails to inform the public about what matters. In 2004, very few people had any idea about the very real differences between the candidates on domestic policy. It remains to be seen whether 2008 is any better.
The other problem, which has become very apparent lately, is that this sort of coverage often fails even on its own terms, because the way things look to inside-the-Beltway pundits can be very different from the way they look to real people.
Which brings me to the Petraeus hearing.
To a remarkable extent, punditry has taken a pass on whether Gen. Petraeus’s picture of the situation in Iraq is accurate. Instead, it was all about the theatrics – about how impressive he looked, how well or poorly his Congressional inquisitors performed. And the judgment you got if you were watching most of the talking heads was that it was a big win for the administration – especially because the famous MoveOn ad was supposed to have created a scandal, and a problem for the Democrats.
Even if all this had been true, it wouldn’t have mattered much: if the truth is that Iraq is a mess, the public would find out soon enough, and the backlash would be all the greater because of the sense that we had been deceived yet again.
But here’s the thing: new polls by CBS and Gallup show that the Petraeus testimony had basically no effect on public opinion: Americans continue to hate the war, and want out. The whole story about how the hearing had changed everything was a pure figment of the inside-the-Beltway imagination.
What I found striking about the whole thing was the contempt the pundit consensus showed for the public – it was, more or less, “Oh, people just can’t resist a man in uniform.” But it turns out that they can; it’s the punditocracy that can’t.

Iraq War: Cost-Benefit Analysis

This is from the Huffington Post.
The author reveals many of the more significant incorrect assumptions about costs and projected benefits of the Iraq war.

Cost Benefit Analysis
Posted September 23, 2007 | 04:28 PM (EST)
Larry Beinhart.




The War in Iraq has cost about $453,000,000,000 (four hundred and fifty-three billion dollars) to date.


That's pretty hard to grasp. Especially on my income and probably on yours. Let's bring that home and make it a little more understandable.

I live in Ulster County, New York. Our share of that is $372,000,000 (three hundred and seventy-two million dollars).

If you live in Los Angeles, your bill is $4,823,000,000 (four billion, eight hundred twenty-three million). Savannah, Georgia, $144,000,000. Little Rock, Arkansas, $339,000,000. That's how much you're putting in so far. It keeps ticking away at two billion dollars a week. If you live somewhere else and want to know how much it's costing your city or county, go to costofwar.com.

You might also want to do what they suggest. Imagine what could have been done with that much money. The schools, bridges, medical care, playgrounds.


What did we get for our money?

The original deal - as presented to us - was to disarm Saddam Hussein for $50 billion. If we didn't do it right away, the smoking gun would be a mushroom cloud.

Bizarre, but true, that was actually accomplished. And for far less. It wasn't difficult, since Saddam was already disarmed. But by massing our troops and demanding UN resolutions, Saddam was forced to let the inspectors in so that we got to see it for ourselves.


But the administration was set on war! We're not actually sure why. Perhaps they aren't either. So they told us that the inspectors were associated with the UN. They were Swiss or French or some other foreigners, and therefore, unlike Americans, they were easily conned. Their failure to find WMDs didn't mean there weren't any. It really meant that Saddam was super tricky as well as super evil.

So the goal slipped from disarming Saddam to removing Saddam.

Removing Saddam was going to be a magic moment. It was going to be like a Disney animated feature. When the ogre was slain, the entire kingdom would break out with flowers and the flowers would dance and sing. And welcome the Americans as liberators!


That's not all we were going to get for our investment. We were going to get much, much more!

We would strike a blow in the war on terror! Keep (non-existent) weapons of mass destructions out of the hands of a dictator who might give them to terrorists. Establish a democracy in the Middle East. Bring stability to the region and hope to other people under evil dictators. Make Israel safer.

Most of all it would be a demonstration!

We would smite our foe like the Lord God Almighty, throwing thunderbolts and parting the very seas, so that all who saw would quake in fear and tremble before us. That's the colorful, theological version, but it is, in fact, what the administration expected.


We were a beneficent power, too. We were going to rebuild Iraq. George Bush said it was going to be "The greatest financial commitment of it's kind since the Marshall Plan!"

Was that going to cost us more?

No. "We are dealing with a country that can really finance its own reconstruction, and relatively soon," said the ever astute Paul Wolfowitz, deeply knowledgeable about third world countries, war and finance. 'What a deal,' as they used to say, throwing in a second pair of pants and a genuine silk tie, when you bought your Bar Mitzvah suit down on Orchard Street.

But it wasn't a Disney movie. The commander-in-chief and his crew were wrong in their assumptions and incompetent in execution.

If they stop, they will have to admit that we got nothing for our money. If they go forward, it's not their money. Or their bodies. While it's not be in our interests, its in their interests to turn the war into the Energizer Bunny, endlessly, mindlessly, going and going and going.


One question that should be asked, but hasn't been, is where did the money actually go?

The answer is that nobody really knows.

To give you some idea of how bad the book keeping is, the Congressional Budget Office reported that from 2001 to 2006 we had spent 290 billion dollars on the war in Iraq. But the Congressional Records Office had the number at $318.5 billion dollars. A gap of 28.5 billion.

The Government Accounting Office said that because of the way the Department of Defense handles its money, "neither DOD nor the Congress reliably know how much the war is costing and how appropriated funds are being used."

We don't even know how many troops are deployed to Iraq. One Defense Department system says 260,000, another says 207,000, and the DFAS, who does their payrolls, says 202,000. A difference of as much as 58,000 troops.

The Armed Forces have been so privatized that General Patraeus is not guarded by soldiers, but by private contractors.

When we pass a bill for billions to 'support the troops,' we have no way of knowing how many troops we're supporting or how much money is supporting them. It would be at least as accurate to say it's a bill to support Halliburton, Blackwater and the General's private security guards.


George Bush's version of the Marshall Plan, the reconstruction, is even worse. Paul Bremer III burned through - an estimated - forty billion dollars. Billions were handed out in cash. People were playing football with shrink wrapped bricks of $100 bills.

Nobody knows where the money went.

Nor has there been much reconstruction. There is less electrical service than before the war. There are fewer functioning schools, hospitals and medical facilities. There is no one to staff them if they had been built, since so many of the people with skills have been killed or driven out of the country. Water and waste treatment is so inadequate that a cholera epidemic is appearing.

A cost-benefit analysis would say that what we have achieved is in the minus column. That we spent forty billion dollars to get deconstruction.


Alright, there was waste, corruption and profiteering on a grand scale. Alright, the Iraqis didn't get anything for money, except hundreds of murderous, petty tyrants to replace one, grand, bloody dictator. But what did we get for our money?

We didn't get rid of the WMDs, because they weren't there.

We got rid of Saddam Hussein. He was replaced by a nominal democracy, but an actual chaos. Murder, rape, gang violence, civil war, revenge killings, semi-tribal war, have become the norm.

Al Qaeda not only survived, it got stronger.

The Middle East is less stable.

Israel looks more vulnerable.

Iran has been strengthened.

Instead of being a demonstration of irresistible power, the war exposed the limits of American power.

Iraq has become the textbook on how an insurgency can defeat a major power.

George Bush said this was a war for civilization. In the course of it, we have rejected the Geneva Conventions, the Nuremberg Principles, and the rule of law. We have embraced torture, failed to protect and provide for civilians in a country under our occupation and allowed the monuments and treasures of an ancient civilization to be looted and destroyed. Who is it that's fighting for civilization?


Has anyone benefited from this war? Yes.

Before the war Halliburton was facing bankruptcy. Now they're doing very well, along with a host of other military contractors.

The really big winners are Iran and Al Qaeda.

Osama bin Laden was a murderous madman, an outlaw hiding the caves of Tora Bora. Now Al Qaeda has a new base in Iraq and controls at least one province. His goal was to get America into a war like the one the Soviets fought, and lost, in Afghanistan. Which he did. He also wanted an actual world wide conflict between Islam and the West. He got that too.

Iran wanted Saddam Hussein gone. To have Shia'a groups, with ties to Iran, come to power afterward. For America to be weakened and to have its forces tied down so they could pursue their nuclear ambitions. They got all that.


As I wrote this, I heard a story on the radio about a kid from Saugerties - which is the next little town over from here - who got both legs blown off in Iraq. I didn't catch his name. I'm sorry. He's one of the 25,830 that the DOD reported as officially wounded. Along with 3500 US dead. The 650,000 Iraqi dead. No one counts their wounded. Millions driven into exile.


Those are some of the costs. Now you know who benefited.


Larry Beinhart is the author of Wag the Dog, The Librarian, and Fog Facts: Searching for Truth in the Land of Spin. All available at nationbooks.org Responses can be sent to beinhart@earthlink.net

Talabani demands release of Iranian

Do Americans realise the enormity of what they do when they kidnap someone who is an invited guest in a country that is supposedly sovereign? It seems not or they would not do it. Obviously the Iraqi government knew nothing about this. It is fortunate for the US that there must have been no protection for the Iranian or their could have been a firefight. In fact this almost happened in the Irbil raids when some of the targets evaded the US through the Erbil airport. The US has not yet released five Iranians seized then from a quasi-consular site in spite of requests to do so.
How does the US expect the Iraqi government to be looked upon as the sovereign power when it does things like this.

Iraq president demands release of detained Iranian Sat Sep 22, 11:23 AM ET



BAGHDAD (AFP) - Iraqi President Jalal Talabani slammed the US military on Saturday for detaining an Iranian official earlier this week and called for his "immediate" release.



"I am informing you (the US military) of our displeasure over the arrest of the Iranian civilian official without consulting the government of Kurdistan and that is a humiliation for the regional administration," Talabani said in a statement released by his office in Baghdad.

"You ignored our authority. I ask for his immediate release in order to maintain healthy relations between Iran and Kurdistan and for the prosperity of Kurdistan," added Talabani, who is himself a Kurd.

The US military seized the Iranian from a hotel in Sulaimaniyah in the northern Kurdish region on Thursday, charging that he was an officer in the covert operations arm of Iran's elite Revolutionary Guards.

But both Iran and the Kurdish regional government have insisted he was part of a visiting business delegation and demanded his immediate release.

"He was an official on a commercial mission with the knowledge of the federal government in Baghdad and the government of Kurdistan," Talabani said in a statement addressed to General David Petraeus, the head of US forces in Iraq, and US ambassador Ryan Crocker.

Talabani said the arrest had triggered an angry reaction from Tehran which has "threatened to close its border with the Kurdish region if Mahmudi Farhadi, a civilian employee of Kermanshah (province in western Iran) is not released".

"This will handicap trade in the Kurdish region in this blessed month," he added in reference to Ramadan, the holiest month in the Islamic calendar.

Privatizing the Military

It may not be possible politically for Maliki to continue to allow firms such as Blackwater to remain above the law. His government already lacks credibility with many Iraqis. He cannot bring killers to trial. He cannot get the US to release an Iranian guest of his government. He is allowed to take a pee whenever he wants though but Blackwater probably provides urinal security.
The genius of late capitalsim is opening up new areas for capital investment that had previously been provided by the state. Of course the State still provides funding so that taxpayer is not let off except insofar as the costs may be less-but often they are more. Just off the top of my head you have the following: privatising prisons, outsourcing meals and other services at public institutions to private companies, increasing the number of roads privately built and paid for by tolls rather than having "free" taxpayer paid highways, private security and military firms of various sorts as listed in this article. We have returning in a new form things that had virtually disappeared: mercenaries, private prisons, toll roads.




Making a killing: how private armies became a $120bn global industry
By Daniel Howden and Leonard Doyle in Washington
Published: 21 September 2007
In Nigeria, corporate commandos exchange fire with local rebels attacking an oil platform. In Afghanistan, private bodyguards help to foil yet another assassination attempt on President Hamid Karzai. In Colombia, a contracted pilot comes under fire from guerrillas while spraying coca fields with pesticides. On the border between Iraq and Iran, privately owned Apache helicopters deliver US special forces to a covert operation.

This is a snapshot of a working day in the burgeoning world of private military companies, arguably the fastest-growing industry in the global economy. The sector is now worth up to $120bn annually with operations in at least 50 countries, according to Peter Singer, a security analyst with the Brookings Institution in Washington.

"The rate of growth in the security industry has been phenomenal," says Deborah Avant, a professor of political science at UCLA. The single largest spur to this boom is the conflict in Iraq.

The workings of this industry have come under intense scrutiny this week in the angry aftermath of the killing of Iraqi civilians by the US-owned Blackwater corporation in Baghdad. The Iraqi government has demanded the North Carolina-based company is withdrawn. But with Blackwater responsible for the protection of hundreds of senior US and Iraqi officials, from the US ambassador to visiting congressional delegations, there is certainty in diplomatic and military circles that this will not happen.

The origins of these shadow armies trace back to the early 1990s and the end of the Cold War, Bob Ayers, a security expert with Chatham House in London, explains: "In the good old days of the Cold War there were two superpowers who kept a lid on everything in their respective parts of the world."

He likens the collapse of the Soviet Union to "taking the lid off a pressure cooker". What we have seen since, he says, is the rise of international dissident groups, ultranationalists and multiple threats to global security.

The new era also saw a significant reduction in the size of the standing armies, at the same time as a rise in global insecurity which increased both the availability of military expertise and the demand for it. It was a business opportunity that could not be ignored.

Now the mercenary trade comes with its own business jargon. Guns for hire come under the umbrella term of privatised military firms, with their own acronym PMFs. The industry itself has done everything it can to shed the "mercenary" tag and most companies avoid the term "military" in preference for "security". "The term mercenary is not accurate," says Mr Ayers, who argues that military personnel in defensive roles should be distinguished from soldiers of fortune.

There is nothing new about soldiers for hire, the private companies simply represent the trade in a new form. "Organised as business entities and structured along corporate lines, they mark the corporate evolution of the mercenary trade," according to Mr Singer, who was among the first to plot the worldwide explosion in the use of private military firms.

In many ways it mirrors broader trends in the world economy as countries switch from manufacturing to services and outsource functions once thought to be the preserve of the state. Iraq has become a testing ground for this burgeoning industry, creating staggering financial opportunities and equally immense ethical dilemmas.

None of the estimated 48,000 private military operatives in Iraq has been convicted of a crime and no one knows how many Iraqis have been killed by private military forces, because the US does not keep records.

According to some estimates, more than 800 private military employees have been killed in the war so far, and as many as 3,300 wounded.

These numbers are greater than the losses suffered by any single US army division and larger than the casualties suffered by the rest of the coalition put together.

A high-ranking US military commander in Iraq said: "These guys run loose in this country and do stupid stuff. There's no authority over them, so you can't come down on them hard when they escalate force. They shoot people."

In Abu Ghraib, all of the translators and up to half of the interrogators were reportedly private contractors.

Private soldiers are involved in all stages of war, from training and war-gaming before the invasion to delivering supplies. Camp Doha in Kuwait, the launch-pad for the invasion, was built by private contractors.

It is not just the military that has turned to the private sector, humanitarian agencies are dependent on PMFs in almost every war zone from Bosnia to the Democratic Republic of Congo. Which raises the next market the industry would like to see opened: peacekeeping. And the lobbying has already begun.

More on Syrian raids and nuclear materials

One must read this with a great deal of skepticism. The Israeli's themselves have maintained a complete silence and censorship. The Syrians make it sound as if the Israelis simply dropped "ammunition" and turned around. They also jettisoned fuel tanks over the Turkish border. Most of the reports I have seen fail to mention that this attack is a clear and flagrant violation of International Law. Apparently no one cares. Imagine if Cuba just went and dropped some bombs on south Florida because they saw some Cuban exiles gathering an expeditionary force there, or thought they did.
Most articles like this can just be safely filed under psy-ops. The authorities are always anonymous of course but "well-placed" or "expert".
If the US keeps up with this type of report then do not be surprised if the nuclear deal with North Korea comes unstuck once again.


From The Sunday TimesSeptember 23, 2007

Israeli commandos seized nuclear material of North Korean origin during a daring raid on a secret military site in Syria before Israel bombed it this month, according to informed sources in Washington and Jerusalem.

The attack was launched with American approval on September 6 after Washington was shown evidence the material was nuclear related, the well-placed sources say.

They confirmed that samples taken from Syria for testing had been identified as North Korean. This raised fears that Syria might have joined North Korea and Iran in seeking to acquire nuclear weapons.

Related Links
Snatched: Israeli commandos ‘nuclear’ raid
Blast at secret missile site killed dozens
Israeli special forces had been gathering intelligence for several months in Syria, according to Israeli sources. They located the nuclear material at a compound near Dayr az-Zwar in the north.

Evidence that North Korean personnel were at the site is said to have been shared with President George W Bush over the summer. A senior American source said the administration sought proof of nuclear-related activities before giving the attack its blessing.

Diplomats in North Korea and China believe a number of North Koreans were killed in the strike, based on reports reaching Asian governments about conversations between Chinese and North Korean officials.

Syrian officials flew to Pyongyang, the North Korean capital, last week, reinforcing the view that the two nations were coordinating their response

Democrats getting more CEO donations

The Democrats (Tweedle Dum) are coming close enough to the positions of the
corporate supporters of The Republicans (Tweedle Dee) that CEO's are beginning to see them as worth supporting. They appear as likely winners in the next elections and so to hedge their bets they are placing money on the Democrats.


CEOs, Bush Rangers Rebuff Republicans on War, Widening
Deficit Michael Janofsky
Fri Sep 21, 12:16 AM ET



Sept. 21 (Bloomberg) -- Dozens of corporate executives
who backed President George W. Bush for re-election in
2004, including some of his top fund-raisers, are now
helping Democrats running for president.

ADVERTISEMENT

John Mack, chief executive officer of Morgan Stanley,
Rupert Murdoch, chairman of News Corp., and Terry
Semel, chairman of Yahoo! Inc., are among some 60
executives writing checks to Democrats such as
Senators Hillary Clinton of New York and Barack Obama
of Illinois, a review of U.S. Federal Election
Commission records shows.

While the vast majority of business leaders still back
Republicans for 2008, the stature of some of those
donating to Democrats suggests that support may be
eroding, seven years into the Bush presidency. Some
executives expressed concern over Republican positions
on issues ranging from the war in Iraq and stem-cell
research to global warming and the fiscal deficit.

The shift in political-spending patterns is ``very
unusual,'' says Fred Wertheimer, president of
Democracy 21, a Washington-based group that advocates
campaign-finance reform.

``Normally, if you have dissatisfaction with the
administration, you figure out who in your own party
you'll support in the next election,'' he says. ``You
don't look at other parties.''

The Democratic victory in last November's
congressional elections may have also sparked greater
interest in the party. ``Money tends to follow people
who have power,'' Wertheimer says.

`Strong Asset'

Bush sounded unconcerned yesterday that he might
adversely affect Republican chances next year. Asked
at a White House news conference if he were ``an asset
or liability'' to members of his party seeking
election, he replied, ``Strong asset.''

Nonetheless, some of his strongest supporters are
wavering -- or at least hedging their bets.

Sig Rogich, president of Rogich Communications Group
in Las Vegas, raised at least $200,000 for Bush in
2004, earning the campaign's designation of
``Ranger.'' This year, Rogich gave $2,300 to Governor
Bill Richardson of New Mexico, a Democrat, and $4,600
to Senator John McCain of Arizona, a Republican,
according to the most recent election records, which
go through June 30.

``Conservatives have two hard-core beliefs,'' says
Rogich. ``They favor lower taxes and lower spending.''
Federal spending is ``the highest in the history of
the nation,'' he says.

Morgan Stanley's Mack, another of Bush's Rangers, held
a fund-raiser for Clinton, a New York senator, in
July.

`Beyond Party Labels'

``When it comes to supporting a political candidate, I
have always looked beyond party labels to the person I
felt was best for the job and most able to lead the
country forward,'' Mack wrote to executives of the New
York-based company in June, explaining his choice. ``I
personally believe that person is Hillary Clinton.''

Murdoch, who donated $25,000 to the Republican
National Committee in 2004, has given Clinton $2,300.
Semel of Sunnyvale, California-based Yahoo!, who gave
$2,000 to Bush in 2004 and $50,000 to the Republican
National Committee, has given the maximum, $4,600, to
Clinton and $2,300 to Obama.

The Republican National Committee says executives will
continue to overwhelmingly back the party, citing its
candidates' stances on issues such as cutting taxes
and curbing lawsuits.

``We fully expect our nominee to have the resources to
run a successful campaign,'' says Dan Ronayne, a
spokesman for the RNC.

Outdoing Republicans

Through the latest FEC reporting period, the three
leading Democrats -- Clinton, Obama and former North
Carolina Senator John Edwards -- out-raised the three
leading Republicans -- former Massachusetts Governor
Mitt Romney, former New York City Mayor Rudy Giuliani
and McCain, $145.2 million to $103.3 million.

Spokesmen for Romney and the latest Republican to
enter the field, former Senator Fred Thompson of
Tennessee, say they're also confident of their
corporate backing.

``We're very happy with the level of giving from
individuals in the private sector,'' says Romney
spokesman Eric Fehrnstrom. Among executives who have
donated to Romney are Richard Farmer, chairman of
Cintas Corp. of Cincinnati, the largest U.S. uniform
supplier, and Ray Irani, chairman of Los Angeles-based
Occidental Petroleum Corp., the fourth-largest U.S.
oil company.

Spokesmen for Giuliani and McCain didn't return calls
seeking comment.

Personal Choices

Mack, Murdoch and Semel declined to discuss their
political choices. Tom Nides, chief administrative
officer for Morgan Stanley, agreed to read aloud parts
of Mack's letter.

Most of the executives declined requests to comment
through spokesmen, saying the donations reflect
personal choices.

Jeffrey Volk, a managing director at Citigroup in New
York, was an exception. He says he grew disenchanted
with Republicans after the federal government failed
to provide more help to the Gulf region after
Hurricane Katrina in 2005. He says he remains a
Republican, although he's supporting Clinton.

``It was absolutely inconceivable to me that after
9/11 another catastrophe could hit a major American
city, and the United States government was not
prepared,'' he says.

John Canning, a deputy board chairman of the Federal
Reserve Bank in Chicago and CEO of Madison Dearborn
Partners LLC, expressed similar misgivings.

A Bush Pioneer in 2004 who has given Obama $2,300, he
described the Republican Party in an April interview
as ``neanderthal'' for its positions on stem-cell
research and global warming. He says he liked Obama's
opposition to the war in Iraq and his approach to
reducing greenhouse gases.

Not On `Same Page'

``I no longer find myself on the same page,'' he says
of Republicans.

The Bush administration opposes more federal spending
on human embryonic stem-cell research. On global
warming, the administration has been criticized by
scientists for a slow response to evidence of climate
change.

Elaine Wynn, who has donated to Republicans in
previous cycles along with her husband, Steve Wynn,
chairman and CEO of Wynn Resorts Ltd. in Las Vegas, is
serving as a member of the Obama campaign ``steering
committee'' in Nevada.

Wynn, whose husband is a trustee of former President
George H.W. Bush's presidential library, says she grew
weary of two decades of leadership under two President
Bushes and President Bill Clinton, with the
possibility of another Clinton ahead.

`Two Families'

``That's a big chunk of my life overseen by two
families,'' she says. ``I'd like to think this is a
broad country with more people to weigh in.''

She says she remains a Republican yet was attracted to
Obama more by seeing young adults drawn to him, rather
than any disenchantment with the current president.

``I jumped on their bandwagon,'' she says.

Gerald Keim, associate dean of MBA programs at Arizona
State University who has written extensively on
corporate political activity, says executives would
have little to gain by discussing their political
preferences because shareholders and customers might
not hold the same views.

``Most of this is very pragmatic,'' Keim says. ``This
is about having relationships so an executive can have
a voice heard on issues that affect the current or
future operations of their companies.''

Number Will Grow

Keim says the number of Republican business leaders
supporting Democrats will ``absolutely grow as it
becomes clear who the Democrat nominee is.''

Among others who have already given are Richard Kelly
of Xcel Energy Inc. of Minneapolis, who donated $1,000
to Bush last time and has given $2,000 to Richardson.
Raymond Mason of Legg Mason Inc. in Baltimore gave
Bush $2,000 in the last cycle and Christopher Dodd of
Connecticut, a Democrat and chairman of the Senate
Banking Committee, $2,300 this cycle.

Other former Rangers and Pioneers helping Democrats
are Lance Weaver, vice chairman of FIA Card Services,
who gave $4,600 to Senator Joseph Biden of Delaware,
and Robert Congel, senior managing director of Pyramid
Cos., who gave Clinton $4,600. Neither responded to
requests for an interview.

Richard Notebaert, who recently retired as CEO of
Denver- based Qwest Communications International Inc.,
contributed $25,000 to the Republican National
Committee in 2004 and thousands more to candidates in
both parties. This cycle, he has given Richardson and
McCain $2,300 each.

He called Richardson ``a good man'' and McCain ``an
outstanding individual'' but says it was still too
early to choose sides.

To contact the reporter on this story: Michael
Janofsky in Los Angeles at mjanofsky@bloomberg.net

Iraq parliament to discuss oil law early in October.

The passage of the law is about a year late. Even if the parliament starts to discuss the law it may not pass for some time. Interesting that the exact wording of the law and annexes remains to be released.


Iraq parliament to discuss key oil law
Thu Sep 20, 2007 2:17pm BST
By Mariam Karouny

BAGHDAD (Reuters) - Iraq's parliament should start in early October to debate an oil law, needed to regulate how wealth from world's third largest oil reserves will be shared by its sectarian and ethnic groups, the deputy speaker said.

Khaled al-Attiya said the parliament would take its time to discuss the draft, which is seen as key to reconciling warring Iraqis and attracting foreign investment. But he expected it to pass before the end of the year.

The legislation, which had been expected to pass before the end of 2006, was delayed due to disagreements over control of oil reserves, much of which are in the semi-autonomous Kurdistan region in northern Iraq and in the country's south.

The draft was approved by the cabinet in February but faced opposition from the Kurds, who felt they were getting a bad deal.

In July, the cabinet approved "some linguistic changes" to February's draft.

Attiya, a senior member in the ruling Shi'ite Alliance, told Reuters late on Wednesday there has been an agreement between the powerful Shi'ite Alliance and the Kurdish coalition to go with the draft approved by the cabinet in February.

"That helped in putting the law on schedule (for debate). Possibly in early October," he said.

He said the law should be debated fully, not decided by some back-room deal.

"This law is not like any other law. This is a strategic law," he said.

"So it is only right that we give this law all the time it deserves in discussions in the parliament and not to have a political deal about it among the political blocs behind closed doors."

But he said: "I do not think that the time will extend beyond the end of the second legislative quarter ... from now until before the end of the year."

Deputy Prime Minister Barham Salih said that there has been a basic agreement between Shi'ite Prime Minister Nuri al-Maliki and the Kurdish Regional Government (KRG) that the draft passed in February stands.

"The prime minister and KRG remain committed to the text voted on unanimously, including the Accordance (Sunni Arabs) ministers in February," Salih said.

The Kurds had previously said some of the annexes were unconstitutional because they wrested oilfields from regional governments and placed them under a new state oil company.

The annexes also covered control over discovered and undiscovered oilfields and who would have the power to negotiate contracts with international oil companies.

February's draft refers to annexes but they were neither discussed nor voted on then.


© Reuters 2006. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.

Reuters journalists are subject to the Reuters Editorial Handbook which requires fair presentation and disclosure of relevant interests.

A View from Tehran

Well the US seems determined not to let anyone who might threaten their hegemony in any area to have nuclear weapons and certainly Israel sees a nuclear Iran as unacceptable. The US too has said this ad nauseam. Kissinger speaks for himself although he no doubt has a point that the US would indeed love to control Iran's oil!
Notice the lack of political anti-US rhetoric in the article. Kissinger is used to make their point.


US fears Iran's control of oil, not nuke
Fri, 21 Sep 2007 00:19:55
Source: PressTV

Former US Secretary of State, Henry Kissinger
The Former US Secretary of State says the US is concerned about Iran's control of oil resources, not the country's nuclear supremacy.

“An Iran that practices subversion and seeks regional hegemony - which appears to be the current trend - must be faced with lines it will not be permitted to cross. The industrial nations cannot accept radical forces dominating a region on which their economies depend", claimed Kissinger in his Op-Ed for immediate release entitled: " PUTTING POLITICS ASIDE TO SAVE IRAQ."

"These truisms need to be translated into effective policies, preferably common policies with allies and friends." continued Kissinger.

"Iran has legitimate aspirations that need to be respected," he writes - but those legitimate aspirations do not include control over the oil that the United States and other industrial countries need, he wrote.

He pointed out that none of these objectives can be realized, however, unless two conditions are met: The United States needs to maintain a presence in the region on which its supporters can count and which its adversaries have to take seriously. Above all, the country must recognize that bipartisanship has become a necessity, not a tactic.

Henry Alfred Kissinger, has played a dominant role in US foreign policy between 1969 and 1977 when he served as National Security Advisor and Secretary of State in the Nixon and then Ford administrations.

MHE/MMA

Oil and Corruption in Iraq

This article gives quite a bit of detailed information about oil field development by foreign companies in Kurdistan. It is from this site.

Oil and Corruption in Iraq Part III
Kurdistan's Gushing Crude Spawns Conflict

KIRKUK, Iraq, September 12, 2007 (ENS) - The German seismologist working in northern Iraq was not supposed to talk about his job. But after having spent nearly three months in an isolated camp near the Taq Taq oilfields, he could not contain himself.

"You can dig where you want," he said. "The crude gushes!"

For more than two years, foreign companies have been hunting - and finding - oil in the semi-autonomous Kurdish region. They may not have discovered giant fields like the famous Baba Gurgur near Kirkuk, but the oil companies and their Kurdish clients are very pleased.



Iraq has 115 billion barrels of proven oil reserves, but its actual oil wealth is believed to be significantly higher. Iraqi Kurdistan and the oil-rich region of Kirkuk are prime territories for speculators because of their large proven and potential reserves.

The three northern provinces of Iraqi Kurdistan are also the safest region in Iraq, an additional draw for drillers and investors. The Kurdistan Regional Government, KRG, has pushed ahead with exploration in the north by signing contracts for oil exploration with foreign companies.

That has irked oil officials in central government in Baghdad, however, and the KRG's windfall is far from secure. It is threatened by uncertainty surrounding a new national law on Iraq's oil reserves; by Turkish concerns over Kurdish strength; and by pressure from rival ethnic groups whose territories are not so blessed with natural resources.

In early 2006, the first foreign oil company began producing new oil out of Kurdistan. The Norwegian wildcatter Det Norske Oljeselskap, DNO, sealed two production-sharing agreements with the regional government in 2004, gaining a 55 percent stake in both licenses. DNO will take 10 to 30 percent of the profits; the rest will go to the region.

At first, DNO estimated that the Tawke field near the city of Dohuk held 100 million barrels and would reach peak production of 50,000 barrels a day next year. Now, it appears that the field may contain much more.

DNO's most recent operation in Tawke has a flow rate of 12,000 barrels a day, 40 percent more than another well in the same area.


Oil rig at the Det Norske Oljeselskap Tawke #1 field in Kurdistan. Test production is scheduled to begin this year. (Photo courtesy Kurdistan Tourism)
DNO has 80 trucks moving as much as 10,000 barrels a day from the site. The flow rate may reach 20,000 to 25,000 barrels per day, but transporting this amount of crude by road could be logistically difficult and expensive.

A second lot of drilling began in May 2006 in the Taq Taq region, south of Sulaimaniyah, and was led by Taq Taq Operating Company, also known as TTopco, and Addax Petroleum, a Swiss-Canadian company. TTopco, a joint venture with Genel Enerji of Turkey, is currently drilling its fourth oil well and hopes to drill two more by end of 2007.

The three oil wells that TTopco has already drilled are expected to produce 75,000 barrels a day, said Kemal Afaraci, an official with TTopco. Oil reserves in Taq Taq are estimated at 1.2 billion barrels.

Firms such as Canada's Western Oil Sands and Heritage Oil Corp as well as the UK's Sterling Energy are also exploring the region.

Kurdistan wants to produce 200,000 barrels a day of oil by the end of next year, and increase that to one million barrels per day within five years.

Although northern Iraq's oil reserves are not as large as the giant southern fields round Basra, the local KRG Natural Resources Minister Ashti Hawrami has said the area has "good potential", estimating reserves around 25 billion barrels of oil and 100 trillion cubic feet of natural gas.

He also held out the prospect of a second export pipeline from Kirkuk to the Turkish port of Ceyhan, which would run through Kurdish-controlled territory, thus giving it greater protection from the sabotage attacks that plague pipelines elsewhere in the country.

Kirkuk alone has 10 billion proven barrels, and Hawrami has estimated that 20 billion barrels are lying in other disputed areas in the north.

Based on these estimates, if the Kurds control the north - including parts of Nineweh province, where the KRG already has a strong political and security presence, their potential reserves would be about 55 billion barrels, or almost half of Iraq's known oil reserves.

That would mean Iraq's Kurds would have more oil than Nigeria, Africa's biggest oil producer.

UN supports peace talks with Taliban.

These talks are less peace talks than ways to divide the Taliban and have some break off to support the Karzai government. The Taliban will not talk unless all foreign troops are withdrawn so they will not participate in talks. There are already some "reformed" Taliban who support the Karzai government. In fact that is what "reformed" seems to mean. They still have all the same radical views about the imposition of Sharia law etc. Even the department of Virtue and Vice has returned.


UN supports peace talks between Afghan government, Taliban
Last Updated: Friday, September 21, 2007 | 11:44 PM ET
The Associated Press
The United Nations would support peace talks between the Afghan government and the Taliban and is prepared to help mediate, a key UN envoy said Friday.

Tom Koenigs of Germany, ahead of a high-level meeting to support the government that will include the United States and Iran, said that negotiations won't produce "a quick result" but are essential.

"We from the United Nations will certainly support peace talks because the insurgency cannot be won over by military means only," he said. "We have to keep the door open for negotiations."

Afghan President Hamid Karzai has pressed for open talks with the Taliban, and the group initially seemed willing. But Taliban leadership returned with conditions that would kill chances for talks — that U.S. and NATO troops withdraw and Islamic law be re-employed in Afghanistan.

The UN doesn't expect the "hard core" of the Taliban to negotiate, "but there are certainly tribes who are alienated, maybe even by misgovernance, who can be brought back," Koenigs told a news conference.

He said the UN can mediate, for instance, between tribes that are fighting for the government and tribes that are fighting for the Taliban.

Continue Article

Efforts to bring peace to Afghanistan will be high on the agenda at Sunday's meeting, which will be chaired by Karzai and UN Secretary General Ban Ki-moon and will bring together donor nations, the U.S., NATO countries, Afghanistan's neighbours, the European Union and international lending institutions.

This week, the UN Security Council extended the mandate of the NATO-led peacekeeping force in Afghanistan to almost 40,000 troops in the face of an emboldened insurgency led by the country's former Taliban rulers.

The United States maintains about 13,000 troops in a separate counterinsurgency force.

© The Canadian Press, 2007

Iraqi refugees flee to Sweden and other industrialised countries.

So the US with a huge area and population admits less Iraqis in a year than Syria with a much smaller area does in one day. So people are fleeing liberated and democratic Iraq for the totalitarian dictatorship Syria next door. Of course the democratic liberator the US admits only a handful of Iraqi refugees.


(CNN) -- The number of Iraqi refugees trying to flee to industrialized nations has increased substantially in 2007 -- and nearly half are trying to go to Sweden, the U.N. refugee agency reported Friday.




Sweden received 9,300 asylum claims from Iraqi refugees, out of a total of 19,800 claims made to 36 countries during the first six months of this year, the U.N. High Commissioner for Refugees said.

The agency said "the large Iraqi community in that country and its strong social network might account for the high number of Iraqi asylum seekers there."

The total number of applications is 45 percent higher than in the last six months of 2006, when 13,600 applications were made. The figures are also more than double those for the first six months of 2006, the agency said.

The figures are based on data provided by 36 industrialized countries to the UNHCR.

The United States expects to have admitted only 1,600 to 1,700 Iraqi refugees in the financial year that ends September 30, U.S. officials said Friday. That's fewer than earlier estimates of 2,000 or more for the year.

Officials from the departments of State and Homeland Security predict that the number of Iraqi refugees admitted to the U.S. soon will rise to 1,000 a month.

About 2.2 million Iraqis live outside their country, mostly in Syria and Jordan, the United Nations said. Another million have been uprooted from their homes but are still in Iraq, officials say. Assistance groups such as Refugees International consider the the situation the fastest-growing refugee crisis in the world.

About 2,000 Iraqis arrive in Syria each day, U.N. staff said, according to UNHCR.

Earlier this month, Syria put visa restrictions on Iraqis wishing to enter the country, but temporarily lifted them with the start of Ramadan.

"It is encouraging to note that Iraqis fleeing violence and insecurity are still allowed entry in Syria, which is now hosting nearly 1.5 million Iraqi refugees, a very heavy burden on a country that has shown immense hospitality over the past years," the agency said.

Greece also had a high number of applications from Iraqi asylum seekers, about 3,500, compared with 1,400 in all of last year.

Spain and Germany recorded 1,500 and 820 applications, respectively, during the first half of 2007.

If current trends are maintained, the number of Iraqi asylum seekers could reach the levels seen between 2000 and 2002, when an average of 40,000 to 50,000 Iraqis each year sought refuge in industrialized countries, the agency said. E-mail to a friend

Iraq aims to end immunity of security firms.

Just why has it taken Iraq so long to not legislate this immunity out of existence? Was it because their masters warned them not to? Note that the US hopes that the new laws will be written up in consultation with the US. Also note that the vast majority of security firms are not Iraqi but associated with the occupiers. The Ministry suggests these should be replaced by Iraqi firms. Well, we will see.


Iraq aims to end immunity of security firms
Fri Sep 21, 2007 9:50pm BST
By Mussab Al-Khairalla and Paul Tait

BAGHDAD (Reuters) - Iraq wants to tighten control over security contractors after a deadly shooting incident involving the U.S. firm Blackwater, ending their long immunity from Iraqi prosecution, the Interior Ministry said on Friday.

Blackwater guards were back on the streets of Baghdad on Friday after the U.S. embassy eased a three-day ban on road travel by U.S. officials outside the capital's heavily fortified Green Zone.

Interior Ministry spokesman Major-General Abdul-Kareem Khalaf said the ministry had drafted legislation giving it wider powers over the contractors and calling for "severe punishment for those who fail to adhere to the ... guidelines".

Iraq has said it would review the status of all security firms after what it called a flagrant assault by Blackwater contractors in which 11 people were killed while the firm was escorting a U.S. embassy convoy through Baghdad on Sunday.

Prime Minister Nuri al-Maliki suggested the U.S. embassy should stop using Blackwater and said he would not allow Iraqis to be killed "in cold blood".

U.S. embassy spokeswoman Mirembe Nantongo said the decision to allow "mission essential" trips, some guarded by Blackwater, was taken after consultation with Iraqi authorities.

"There isn't a lot of movement in general ... But it is likely Blackwater will support some of them," she said.

The shooting has incensed Iraqis who regard the tens of thousands of security contractors working in the country as private armies that act with impunity.

Khalaf said the new draft law, which he expected parliament to pass soon, gives the ministry powers to prosecute the companies and to refuse or revoke contracts.

U.S. State Department spokesman Tom Casey said he hoped Iraqi authorities would coordinate with the United States before passing new legislation on security contractors.

"They are free to pass whatever legislation they deem appropriate. It's their county," Casey told reporters in Washington. "What I think we would hope, though, is that before anybody move forward on their own that what we could do is have a discussion about some of these issues ... that it be done in that kind of coordinated manner."

NEW RULES

Many security firms operating in Iraq have no valid licence. A law issued by U.S. administrators after the 2003 invasion which overthrew Saddam Hussein granted them immunity from prosecution and has not been formally revoked.

The New York Times reported on Friday that the Interior Ministry will also propose that foreign security companies be replaced by Iraqi firms.

"These American companies were established in a time when there was no authority or constitution," the newspaper quoted a ministry report as saying.

The head of an association of security firms in Iraq said replacing foreign companies with Iraqi security companies was not a new suggestion and was unlikely to happen overnight.

"One alternative would be partnerships with Iraqi companies, putting an Iraqi face on what we're doing," Lawrence Peter, director of the Private Security Company Association of Iraq, told Reuters.

Peter said around 30,000 people, half of them Iraqis, worked for security firms in Iraq.

U.S. and Iraqi officials have launched a joint inquiry into Sunday's deadly shooting incident involving Blackwater, which employs around 1,000 contractors to protect the U.S. mission and its diplomats from attack.

In the latest violence, one U.S. soldier was killed on Thursday by a bomb which exploded near his vehicle in Diyala province, east of Baghdad, the military said.

The Romanian Defence Ministry said a Romanian soldier was killed and five others were severely wounded in an explosion on Friday during a patrol next to their base in Tallil in the south of the country.

In the southern city of Basra gunmen shot dead Sheikh Amjad al-Jinabi, a religious aide to Iraq's top Shi'ite cleric Grand Ayatollah Ali al-Sistani on Thursday evening after he had attended a funeral in the Shi'ite city, Sistani's office said.

Another Sistani aide was killed in a drive-by shooting in Diwaniya, 180 km (110 miles) south of Baghdad, police said.

Some Shi'ite mosques in Basra cancelled Friday prayers in protest at the killings, residents said.

(Additional reporting by Aref Mohammed in Basra, Aws Qusay in Baghdad and Marius Zaharia in Bucharest )


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Poll on former USSR citizens attitudes

Apparently housing was formerly free in the USSR so it can hardly be less expensive now. Another poster to the list on which this was posted noted that rent's have soared in the last 7 years. An apartment that cost 200 seven years ago now rents for a thousand dollars a month. I imagine that is still not bad compared to many cities worldwide. Apparently education is still "free" but you have to pay fees for courses that are in demand at universities.



September 19, 2007
Hardships Still Common in Former Soviet Nations

Many citizens say aspects of life are worse now than under the Soviet

Union

by Patricia Guadalupe
GALLUP NEWS SERVICE

WASHINGTON, D.C. -- When the Soviet Union collapsed in 1991,
residents of the emerging countries likely hoped that independence
would bring greater economic prosperity and personal well-being.
However, when the Gallup World Poll interviewed citizens of 14 former

Soviet Republics throughout 2006, respondents often reported being
worse off now than they were under the USSR.

In the transition from communism to capitalism, one might expect to
see a trade-off between affordability and quality, especially for
aspects of life that were previously subsidized or free. But while
59% of respondents across the countries surveyed say they face a
higher cost of living now than they did under the Soviet system, they

commonly report deterioration rather than improvement in key
indicators of well-being, including housing, healthcare, and
education.

In the case of the once heavily subsidized housing system of the
former Soviet states, it is not surprising that 61% of respondents in

these countries say housing is now less affordable. But when asked to

rate the quality of housing now versus in the Soviet Union days, 42%
say it is worse now than it was then. Twenty-eight percent of those
living in the former Soviet republics say the quality of housing has
improved and 20% say it remains the same. Residents of Lithuania
(64%), Georgia (60%), Tajikistan (54%), Russia (50%), and Armenia
(50%) are most likely to say the quality of housing has deteriorated.

In no nation is there a majority that says the quality of housing has

improved, though residents of Belarus and Estonia are the most likely

to say so, at 49% and 47%, respectively.

A similar pattern emerges when examining ratings of healthcare and
education. More than half of respondents (55%) say healthcare, which
was provided free by state health institutions in the Soviet era, is
now less affordable. When respondents were asked instead about the
current quality of healthcare versus the quality of care available
under the Soviet Union, they were more divided. Thirty-four percent
of people across all nations surveyed say the quality of healthcare
is better, 38% say it is worse, and 19% say it is the same.
Uzbekistanis (49%), Armenians (48%) and Belarusians (47%) are the
most likely to say the quality of healthcare is better today, while
those in Kyrgyzstan (60%) and Tajikistan (55%) are the most likely to

say it is worse.

Similarly, about half of respondents (49%) tell Gallup that
education, which was free, universal, and multilingual under the
Soviet Union, is currently less affordable. When asked to rate the
quality of education available to them, respondents are again
divided, with 36% saying it is better, 27% saying it is worse, and
23% saying it is the same. People in Lithuania (61%) and Uzbekistan
(50%) are the most likely to report improvement in the quality of
education, while those in Azerbaijan (43%) and Tajikistan (41%) are
most likely to report deterioration.

[...]

Blackwater back on the job.

As reported in the article:
A top aide to Maliki conceded it may prove difficult for the Iraqi government to expel Western security contractors.
Indeed, it is difficult because Iraq is not sovereign at least in areas such as this. The US will decide if and when Blackwater is relieved of its duties. Probably at most some blood money will be paid for the deaths.


Blackwater USA Back On Limited Iraq Duty

BAGHDAD, Sept. 21, 2007
--------------------------------------------------------------------------------
(CBS/AP) The U.S. Embassy resumed limited convoy movements with Blackwater USA protection in Baghdad, four days after all land travel by U.S. diplomats and other civilian officials was suspended in response to Iraqi outrage over the alleged killing of civilians by the American security firm.

U.S. Embassy spokeswoman Mirembe Nantongo said the decision was made after consultations with the Iraqi governments and the convoys will be allowed to leave the heavily fortified Green Zone on a select basis.

"All movements supported by the PSDs have to be mission-essential," she said, referring to an acronym for personal security details run by Blackwater and other security contractors protecting Westerners and other dignitaries in Iraq.

Secretary of State Condoleezza Rice said Friday she had ordered a "full and complete review" of security practices for U.S. diplomats.

Rice said she had directed the State Department to examine "how we are providing security to our diplomats."

Rice had no comment about Friday's resumption of Blackwater-protected convoys but paid tribute to the guards from the firm, one of three that provide security for U.S. diplomats and other civilian government officials in Iraq.

"We have needed and received the protection of Blackwater for a number of years now, and they have lost their own people in protecting our people in extremely dangerous circumstances," she said.

"We take very seriously what happened," Rice said, noting she had called Iraqi Prime Minister Nouri al-Maliki on Monday to express regret.

A top aide to Maliki conceded it may prove difficult for the Iraqi government to expel Western security contractors.

The aide, who spoke on condition of anonymity because the investigation into Sunday's incident was ongoing, said a way out of the Blackwater crisis could be the payment of compensation to victims' families and an agreement from all sides on a new set of rules for their operations in Iraq.

An Interior Ministry spokesman, Maj. Gen. Abdul-Karim Khalaf, said Friday that a report had concluded that Blackwater guards opened fire from four positions on a square in western Baghdad after a vehicle near their convoy failed to stop.

Iraqi witnesses and officials have offered several conflicting versions of events and it was not clear how the Interior Ministry report would affect a joint U.S.-Iraqi investigation.

It really is about Oil.

This is from the blog Dissident Voice. Perhaps the author downplays a bit too much the influence of Israel on US policy but many of the comments on his article seem to be rather extreme and hold that Israel is the dominating factor. With regard to Iran, Israel is no doubt egging the US on all it can but there are surely other important factors and not just oil either.

It Really Is About the Oil–And Not Only in Iraq
by Ron Jacobs / September 18th, 2007

So, the secret is finally out. The Iraq war and occupation is about oil! Alan Greenspan, the man on whom the capitalist press has conferred the title of sage numerous times, says exactly that in his memoirs released this week. Of course, many folks around the world have assumed this for years but, even so, it’s nice to hear it from one of Washington’s own. It was the concern of those that pull the strings on Wall Street and in DC that Saddam Hussein represented a severe threat to their access to oil that prompted the war. According to George Bush and his henchmen, it is the concern that anti-US “extremists” also threaten that access that causes the war and occupation to continue. Of course, these so-called extremists seemed to be primarily composed of Iraqi nationalists who simply want to control their own destinies and not leave them up to a small handful of men with offices in the Green Zone whose lives and livelihood depend on the continued presence of US forces on Iraqi soil.

Oil and other energy resources are also the reason Washington is threatening Iran. There are other factors certainly, not least among them a desire for revenge on the Iranian revolution, but the fundamental motivation for the US threats of military action against Iran is to replace the current regime in Tehran with one that will do Washington’s bidding and provide them with access to that nation’s oil on terms set by DC, not Tehran. That is why the US overthrew Mossadegh back in 1953 and why it supported the Shah even after he was overthrown in 1979. Iran is estimated to have the world’s fifth largest oil reserve and second largest natural gas supply. But, if this is so, then why can’t the US just buy the stuff from them? It could, of course, but that would go against the stated desire of Washington to not only have unfettered access to energy resources, but to also be able to prevent potential competitors from having similar access. In other words, the men and women that run the US want exclusive control over the energy resources of Iraq and Iran and the only way they can get that is through military action, since Hussein was not going to agree to US terms for oil sales and neither will the Tehran regime.

Yet, despite the apparent desires of Dick Cheney and his band of bellicose Beltway warriors, that military action has yet to occur. While the world can certainly be thankful for that, it shouldn’t breathe a sigh of relief just yet. In some of his recent comments on Iraq, George Bush stated that one of the reasons for the continued occupation of Iraq is the need to contain Iran. No matter what one thinks about the government in Tehran, the plain truth is that they have every right to be concerned about the future of Iraq. Just as certain is that they have the right to defend themselves from aggressive actions from groups supported by Washington. Likewise, they have the right to reject Washington’s impending designation of their Revolutionary Guards as a terrorist force. After all, if all things were fair, then a similar designation should be given to the CIA and the US military’s various special forces, all of whom are known to engage in what are essentially terrorist activities.

What about Israel? There are those that insist that Israel is behind the US drive against Iran and Syria. According to these folks, it is Tel Aviv’s desire for a greater Israel that is the guiding force behind Washington’s occupation of Iraq, its threats against Syria and desire to attack Iran. While it is certainly true that Tel Aviv might benefit from regime changes in these nations and there is no doubt that most of the US political establishment supports Israeli expansion, it seems downright foolish to claim that US policy in the Middle East and Central Asia is set by Tel Aviv. After all, it is Tel Aviv that receives military and financial support from Washington, not the other way around. This does not always mean that the two governments agree on specifics, but it does mean that they share both resources and a desire to create a world beneficial to them both. Still, however, Washington is the dominant member of this relationship, if for no other reason than that its financial support of Israel makes it possible for Israel to exist as the regional power that it is. Furthermore, it is the perennial veto held by Washington (and its refusal to demand enforcement of Security Council resolutions against Israel that Washington doesn’t veto) that has allowed Israel to continue its violations of international law without retribution. This doesn’t mean, of course, that Israel will not act alone, but the fact that it hasn’t is certainly an indication that Washington holds the leash in this relationship and not Tel Aviv. Poorly-behaved dogs will pull at their chains and maybe even bite their masters, but they also never forget the hand that provides them with their chow.

Just like in Iraq, any attack on Iran will probably not target oil producing facilities. Indeed, should an attack occur and actually succeed to the point where the US is able to bring in ground forces, it is fairly safe to predict that many of the first GIs on the ground will be deployed to guard those facilities, just like they were in Iraq. As retired general Wesley Clark put it in an op-ed in the September 16, 2007 Washington Post: “To prevent world oil prices from soaring, you’d have to try to protect every oil and gas rig, and the big ports and load points. “Of course, there is also the possibility that the facilities might already be under the control of the oil workers themselves, much like what occurred during the revolution in 1979-1981. Would these workers then become the enemy of the US-led “liberation” forces–the same position that many of the citizens of Iraq now find themselves? If so, one wonders what they have learned from their neighbors to the west in regards to the US military.

Ron Jacobs is the author of The Way The Wind Blew:A History of the Weather Underground. His most recent novel Short Order Frame Up is published by Mainstay Press. He can be reached at: rjacobs3625@charter.net. Read other articles by Ron.

American and the Oil Grab

This is an interesting article from the following newspaper. However the oil law mentioned in the article passed only the Iraqi cabinet. It has not been passed by parliament as yet and it is not clear when or if it will in its present form.

Editorial: America and the Iraq ‘oil grab’

Former head of the US Federal Reserve and economic guru commanding bipartisan reverence for his grasp of the national economy, Mr Alan Greenspan has put the cat among the pigeons in Washington by saying in his latest book The Age of Turbulence: Adventures in a New World that “the Iraq war was about oil”. His exact words were: “I’m saddened that it is politically inconvenient to acknowledge what everyone knows — the Iraq war is largely about oil”.

When the Administration reacted angrily, Mr Greenspan himself found it “politically inconvenient” to stick to his clear pronouncement, but his “verdict” has gone and mixed with the vortex of opinion complaining about the Bush Administration’s “oil barons” falling on Iraq for its oil. To count just the people at the top, President George W Bush himself, Vice-President Dick Cheney and Secretary of State Condoleezza Rice, have close links to the American oil industry, also called the Big Oil.

Mr Cheney, the most hawkish member of the Bush cabinet, had said in 1999: “By 2010 we will need [a further] 50 million barrels a day. The Middle East, with two-thirds of the oil and the lowest cost, is still where the prize lies”. Iraq was invaded under false pretences only to have a large US army bogged down there, after more than half a trillion dollars spent and perhaps half a million Iraqis killed. The central political knot in Iraq today is the privatisation of Iraqi oil, recommended on the basis of the abuse of oil income by Saddam Hussein. In the latest poll, the Iraqi people have rejected privatisation and have voted for state control, clearly to prevent the American Big Oil from walking away with the bonanza.

This happened as the Iraqi prime minister Nuri Al-Maliki — a favourite of President Bush despite his deep involvement in the country’s anti-Sunni militia wars — passed a law in February this year about the control of 115 billion barrels of proven reserves, third in the world after Saudi Arabia and Iran, by a Federal Oil and Gas Council boasting “a panel of oil experts from inside and outside Iraq”. Observers think the “oil experts” mentioned in the law will be predominantly US Big Oil executives!

While it is true that oil-producing Arab states have not made the best use of their oil resource — and the enabling condition in this abuse was nationalisation — what is now on the cards could be more dangerous. The new oil deal to be agreed among Iraq’s three communities will bring in the US Big Oil and help it make profits at the estimated rate of 75 percent from 65 of the 80 known oilfields. The law that seeks to redistribute this privatised oil has reportedly been drafted — behind locked doors — “by a US consulting firm hired by the Bush administration and then carefully retouched by Big Oil, the International Monetary Fund, former US Deputy Defence Secretary Paul Wolfowitz’s World Bank, and the United States Agency for International Development”.

The “oil deal” among the three communities of Iraq — the Kurds the Shiites and the Sunnis — is supposed to be equitable on the basis of the known oilfields, but each party is free to give out contracts on new strikes and keep the revenue. It is here that one begins to understand why the US has been backing the breakaway Kurdish enclave in the north of Iraq. Most of the new strikes are expected to happen in the Kurdish region. The pro-US Kurds will have “all the power to sign oil contracts with whatever companies they want”. And the contracts will be awarded on the advice of the US-dominated Federal Oil and Gas Council!

The case of “oil grab” made out by suspicious journalists against Bush and Big Oil has been greatly bolstered by the sentence in the Greenspan book. President Bush’s family has always been in the oil business, and it was greatly helped by Father Bush’s political career when it came to landing contracts among the Arab sheikhs in the Middle East. Bush Junior was not lucky in his adventures in Arab oil and the companies he joined as an executive kept going under including one Harken Energy Corporation which made a shipwreck in Bahrain in 1990. Junior Bush suddenly offloaded 60 percent of his Harken stock, but was let off by the Securities and Exchange Commission (SEC) which investigated the case. The chairman of SEC had been appointed by Father Bush! Now President George W Bush is in Iraq with troops; is the oil there for the taking? Mr Greenspan thinks it is. *

Kucinich: Occupation of Iraq is a Crime

Well at least one presidential candidate is not afraid of speaking the truth. However Kucinich's chances of winning are virtually nil unfortunately. I think that the word "immortality" in the quote from Kucinich should be "immorality". However, perhaps he meant that the forces would be there forever!
--------------------------------------------------------------------------------

Kucinich: Occupation of Iraq is a Crime, Smokescreen for Oil Control
By Dan Wilken
Democratic Presidential candidate Dennis Kucinich states that the president's announcement to keep U.S. forces in Iraq for Stability and Security beyond his term of office is a cover-up for the real reason. As stated by Kucinich, "the announcement is a smokescreen to cover the immortality and criminality of the real reason he took us to war and the reason he refuses to end it: oil."
Kucinich states that to facilitate and protect the smokescreen cover-up, Bush is willing to continue to facilitate and protect this scheme, willing to continue the U.S. occupation in Iraq, keep our brave men and women in the line of fire and risk an escalation of violence and regional stability.

Kucinich is the only democratic candidate who voted against authorization of the original Iraq War intent in 2002. He has continued down this road voting against supplemental funding appropriation by the government since. He states that the war is a crime of international proportions. It continues right under the noses of congressional members who refuse to listen, candidates who do not understand and the media who are virtually asleep at their desk.

Kucinich also states that the President and congress when discussing the progress in Iraq in meeting eighteen benchmarks is only interested in one arena. That arena is the privatization of Iraq's oil and is disclosed under the guise of a proposal parlayed to the nation as revenue sharing. He says the government is using the power of the U.S. military to its own advantage.

Earlier this year, on the floor of the U.S. House, Kucinich presented an exceptional speech providing details regarding the implications of the proposed hydrocarbon law and chronicling what are secret discussions and negotiations leading to the formulation of this law. In his speech, documents were provided dating back to 1999 disclosing international oil interest with representation from the Bush Administration. Dick Cheney along with others have been planning for years the methods to be used to allow exploitation of the Iraq Oil Industry by major oil companies. Kucinich also provided details that top oil executives have been secretively providing guidance to the government and Iraqi government as to how Iraq could end their state controlled oil industry and facilitate foreign investment.

Kucinich states, "That's why the President will not bring our troops home. It's exactly what I've been saying for five years: It's always been about oil."

Kucinich strongly encourages that everyone who voted for the war and everyone who voted to continue funding the war should be held accountable for the consequences. He advises those who voted to admit if they did not know what they were doing. In addition, he states that if they are blind to what is going on, their vision and judgment is impaired.

Sources:

Kucinich for President 2008

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/09-14-2007/0004663113&EDATE=


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Motion for nuclear free mid-east passed in IAEA.

Note that the headline is that this is a vote against Israel not that it is a call for a nuclear free mid-east. This is typical "framing" of discourse. Of course the motion is in a sense against Israel but only because Israel is the only mid-east country with nuclear weapons. The motion also would count against Iran or Syria if either is attempting to build nuclear weapons. The Arab countries are surely correct that there is an obvious double standard when it comest to nuclear weapons. Israel is allowed to have them but no one else in the Mid-east.


Arabs push through U.N. watchdog vote against Israel
Thu Sep 20, 2007 7:52pm EDT


VIENNA (Reuters) - Arab and other Islamic nations, targeting Israel's undeclared nuclear arsenal, pushed through a U.N. atomic watchdog resolution on Thursday calling on all Middle East nations to renounce atomic weapons.

The unusual vote was 53-2 but with 47 abstentions by Western and developing states, highlighting reservations that the move politicized the International Atomic Energy Agency's work.

The decision was non-binding but symbolized tensions over Israel's presumed nuclear might and shunning of the nuclear Non-Proliferation Treaty (NPT), and it frayed the traditional consensus culture of the Vienna-based IAEA.

Israel is widely assumed to have the Middle East's only nuclear arsenal, though it has never confirmed or denied it.

A similar resolution urging all Middle East nations to adopt IAEA safeguards on nuclear work passed overwhelmingly at last year's IAEA general assembly, with only Israel and top ally the United States opposed, as they were again on Thursday.

Egypt reintroduced the resolution this year seeking full consensus but attached two new clauses that prompted Israel to demand a vote and European, other Western and non-aligned developing nations to abstain.

One clause urged all nations in the Middle East, pending creation of a nuclear weapons-free zone (NWFZ) there, not to make or test nuclear arms or let them be deployed on their soil. The other urged big nuclear arms powers not to foil such a step.

"The new language threatened to bring new political issues into the IAEA that would ultimately detract from the technical role the IAEA plays in safeguarding nuclear material," said a Western diplomat whose delegation abstained.

AVOID "DOUBLE STANDARDS", EGYPT SAYS

Egyptian ambassador Ehab Fawzy said the U.N. General Assembly passed the same measure by consensus and IAEA members should follow suit to seek universal compliance with the NPT and "avoid double standards" in the Middle East.

Israel bemoaned the vote, saying that while a NWFZ was a commendable ideal, "we can have no illusions" as long as some Arab neighbors continue not to recognize the Jewish state, with Islamist Iran openly calling for its elimination.

Without peaceful relations in the region, "any steps diminishing security margins should be mutual. You aim high but start modestly with confidence-building, inevitably a long and enduring process," said Israeli envoy Israel Michaeli.

Iran, under U.N. sanctions for refusing to halt a nuclear energy program seen as a possible covert bid for atom bombs, told the assembly that whoever opposed the resolution betrayed a "discriminatory" approach to Middle East security.

Arab diplomats point to a chronic imbalance of power in the Middle East caused by Israeli might and say it breeds instability and spurs others to seek mass-destruction weaponry.

European diplomats said their missions abstained because, while they backed universal IAEA non-proliferation controls in the Middle East, the amended resolution flouted the agency's non-political ethos and sought to isolate a member state.

"The IAEA is not the place to solve complex Middle East political problems. This measure was not about finding rational solutions, or any consensus, but to score points and antagonize," said a senior European Union diplomat.

The issue was expected to split the assembly again on its last day on Friday when Arabs intended to revive a resolution declaring Israel a "threat" and demanding it use atomic energy only for peaceful ends and join the NPT.

A year ago, Western nations sponsored a "no-action" ballot that prevented a vote on the "threat" resolution.

The sole EU nation to vote for Thursday's resolution was staunchly anti-nuclear Ireland. China, India, Russia, Japan, Latin American and some African nations also voted yes.

(additional reporting by Karin Strohecker)

Background on Petraeus and Crocker

This article explores in some detail the background of General Petraeus and Ambassador Ryan Crocker. It also reveals that backdrop to the development of the reports and hearings. Neither of the two looks to be very successful except at promoting their own careers. I did not realise that Crocker was so heavily involved in planning post-Saddam Iraq or was to a degree responsible for disbanding the Iraqi army. This was in effect a great way to create recruits for the ranks of the insurgents. Crocker was also involved in privatisation and pressing for the new oil law.


Published on openDemocracy (http://www.opendemocracy.net)
The architects of Iraq
By Tareq Y Ismael
Created 2007-09-18 18:28
A potentially decisive season of hearings and discussions about the performance and future of United States forces in Iraq has come to a provisional conclusion with the Congressional testimony of the US's two leading players in Baghdad: military commander General David H Petraeus and ambassador Ryan Crocker. But any expectation that their or their predecessors' reports assessing the progress of the military "surge" and its accompanying political efforts has proved futile. Instead, Washington - and United States political discourse about Iraq more generally - sleepwalks (see Gideon Rachman, "Many contenders but just one voice [1]", Financial Times, 18 September 2007).

This outcome suggests that the feverish predictions of a momentous opening of real debate about the consequences of the US invasion of Iraq were always grounded in fantasy. As with the frenzied anticipation that surrounded the Iraq Study Group report of December 2006, the real attention is better focused on the underlying character and dynamics of the US project than on official, establishment discourse, which tends to evade this key issue (see "The Iraq Study Group report: an assessment" [1], 8 December 2006).

The immediate pre-history of the Petraeus and Crocker reports [2] is a healthy corrective to the temptation - indulged by critics of the George W Bush administration too - to overestimate the chances of a new course in Iraq as long as the existing power-brokers in Washington are in charge.

The background of policy

Tareq Y Ismael is professor [3] of political science at the University of Calgary, and editor of the International Journal of Contemporary Iraqi Studies [4].

Among his many books are Middle East Politics Today: Government and Civil Society (University Press of Florida, 2001 [5]); (co-edited with William W Haddad) Iraq: The Human Cost of History (Pluto Press, 2003 [6]); and (with Jacqueline S Ismael), The Iraqi Predicament: People in the Quagmire of Power Politics (Pluto Press, 2004 [7])

Also by Tareq Y Ismael in openDemocracy:

"The Iraq Study Group report: an assessment" [7] (8 December 2006)

"The ghost of Saddam Hussein [7]" (30 January 2007)

"Saudi Arabia, Iraq and the United States [7]" (23 April 2007)
Most analysis and commentary on Petraeus's and Crocker's reports have been presented without due attention to the background of the men who wrote the reports, as well as outside the larger and relevant context of occupation [8] and destruction. Many observers have focused attention on the minutiae of the so-called "Anbar model [9]" - whose speciousness was in any case highlighted by the subsequent killing of Abdul Sattar Abu Risha [10], the chief Iraqi figure of the "Anbar Salvation Council". Few have sought clues to the reports' findings in the professional character of their putative authors; but they are there to be found.

General David H Petraeus [11] is an ambitious, intelligent officer who holds a doctorate in international relations from Princeton University. His first combat mission was the Iraqi invasion in 2003, where he served as the commander of the 101st airborne division. In post-invasion Iraq, General Petraeus has been charged with three roles, each ending in debacle.

First, he was responsible for ensuring stability by recruiting and training the local police force in Mosul. After his efforts had been deemed [12] successful, he left Mosul in February 2004. In November 2004, insurgents had captured most of the city; 7,000 police recruited by General Petraeus either changed sides or simply went home; thirty police stations were captured; 11,000 assault rifles and other military equipment worth $41 million disappeared; and Iraqi army units abandoned their bases (see Patrick Cockburn, "General Surge [13]", Independent, 9 September 2007).

His second role, which began in May 2004, was training a new national Iraqi army, of which he wrote confidently four months later: "Training is on track and increasing in capacity. Infrastructure is being repaired. Command and control structures and institutions are being re-established" (see Patrick Cockburn, "President Petraeus? [14]", Independent, 13 September, 2007). Three years later his trained Iraqi army is still inadequate and is affected by various levels of sectarianism and corruption.

Third, Petraeus was charged with being the executor and the public face of the "surge" policy, launched in February 2007 (see Tom Engelhardt, "Launching Brand Petraeus [15]", TomDispatch, 9 September 2007). This reflected the narrowing of US strategic goals from those proclaimed by President Bush in November 2005, when he defined victory in Iraq according to a set of short, medium, and long-term goals (the short-term goals included "meeting political milestones; building democratic institutions; standing up robust security forces to gather intelligence, destroy terrorist networks, and maintain security; and tackling key economic reforms to lay the foundation for a sound economy" (see White House, National Strategy for Victory in Iraq [16], 30 November 2005).


When these eluded accomplishment, Bush was forced to lower the bar to the bare requirement of mission stability. Petraeus was picked to manage this objective in late January 2007, and the Senate confirmed the appointment in February, when the six-month US military “surge” [16]commenced.

Ryan Crocker [17] is a career foreign-service officer with long, high-level experience in the middle east and south Asia. He speaks good Arabic, and witnessed [18] the marine withdrawal from Beirut after the suicide-attack that killed 241 of their number in 1983; a withdrawal that was equivalent, in his mind, to capitulation to terrorism. For a brief period in the summer of 2003, Crocker served as political advisor to occupation proconsul Paul Bremer (see Karen DeYoung, "The Iraq's Report Other Voice [19]", Washington Post, 10 September 2007).

Less than a month after the 9/11 attacks, Crocker (then deputy assistant of state for near-eastern affairs), was heavily involved in planning post-Saddam Iraq in what came to be known as the "future of Iraq" project, which produced 1,200 pages of documents covering each facet of Iraqi society and state. As an advisor to Bremer, Crocker shared responsibility for the dissolution of the Iraqi army, implementing the recommendations of the "defense policy and institutions working group", to the effect of depoliticising the Iraqi army in order to restructure along a positive unifying role (see Farrah Hassan, National Security Archive - Electronic Briefing Book, No 198 [20] [1 September 2006]).

The disaster that followed the disbanding of the army later provided the base of the Sunni insurgency and drove spiralling violence in Iraq; the thinking and approach showed a remarkable ignorance of the indispensable role of the army in Iraqi state and society. Yet, Crocker went on to be appointed [21] the man charged with effecting national reconciliation, economic revival and a re-building of Iraqi infrastructure, all under the shadow of an unpopular occupation.

Crocker is, moreover, an architect of the denationalisation of Iraq's oil industry, which was a priority among the eighteen benchmarks; this has come to be known as the "oil law [22]" - an opening of Iraq's national industry to the control of foreign entities. The "oil law" is highly unpopular among huge numbers of Iraqis committed to their own country's national interests; it is certain to drive fragmentation rather than reconciliation.

The ethos of power

It is now no secret that the US-led invasion and occupation of Iraq was based on intelligence that was spurious if not downright deceptive; and that the project owes much to longer-term American strategic objectives towards Iraq and the region.

Throughout the 1990s, US strategic concerns were dominated by a constantly growing domestic need for oil articulated by rising power-centres within the economy. In 1999, as CEO of Halliburton, the future vice-president Dick Cheney gave a speech to the Institute of Petroleum which highlighted his own vision of the absolute priority of oil in US grand strategy:

" ... by 2010 we will need on the order of an additional fifty million barrels a day ... the Middle East with two thirds of the world's oil and the lowest cost, is still where the prize ultimately lies ... governments and the national oil companies are obviously controlling about ninety per cent of the assets. Oil remains fundamentally a government business" (see Energy Bulletin, 8 June 2004 [23]).

Among openDemocracy's recent articles on United States strategy in Iraq:

Paul Rogers, "Iraq: the dissonance effect [23]" (30 August 2007)

Paul Rogers, "Baghdad spin, Tehran war [23]" (6 September 2007)

Anita Sharma & Brian Katulis, "Refugees: the missing Iraq benchmark [23]" (7 September 2007)

Volker Perthes, "Iraq in 2012: four scenarios [23]" (11 September 2007)

Sidney Blumenthal, "The American politics of Iraqi war [23]" (17 September 2007)
When Cheney entered the Bush administration, he developed the formula that those who control Iraq will control its vast oil reserves as well as the oil capacities of the larger region.

Today, the paramount role of oil in US grand strategy has become more widely acknowledged [24], even by establishment figures such as ex-chair of the federal reserve, Alan Greenspan [25] (whose autobiography expresses [26] sadness "that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil".)

The wider regional and international context of US policy towards Iraq [26], against the background of the professional and personal profiles of Petraeus and Crocker, makes the political and public-relations aspect of their reports to Congress all the more evident. The heart of the matter was hollow [27]: a campaign to salvage the eroding credibility of a lame-duck president.

The hollowness extends even to the provenance of the respective reports, in light of the close cooperation with the White House involved in generating them:

"Despite Bush's repeated statements that the report will reflect examinations by Petraeus and Ryan Crocker, the U.S. ambassador to Iraq, administration officials said it would actually be written by the White House, with inputs from officials throughout the government. And though Petraeus and Crocker presented their recommendations on Capitol Hill, legislation passed by Congress leaves it to the president to decide how to interpret the report's data" (see Julian E Barnes & Peter Spiegel, "Top general may propose pullbacks [28]", Los Angeles Times, 15 August 2007).

The soft and collusive character of the Petraeus proceedings - with the session effectively framed by sympathetic Republican members ready pre-emptively to pillory those who would question the general's credibility and/or independence - ensured that such critical questions as there were touched only on details of the general's report, rather than on the fundamentals of the surge policy and the larger context of occupation (see Leila Fadel, "Security in Iraq still elusive [29]", McClatchy newspapers, 9 September 2007).

Even earlier "insider" assessments had offered a far bleaker [30] view of US performance - including the government accountability office (GAO) report presented by General David Walker (see Karen DeYoung & Thomas E Ricks, "Report Finds Little Progress On Iraq Goals [31]", Washington Post, 30 August 2007) and the Independent Commission on the Security Forces of Iraq [32], chaired by retired General James L Jones (see William H McMichael, "New Iraq war report echoes previous analysis [33]", AirForce Times, 18 September 2007).

The mismatch [33] between the fantasies of US progress in Iraq and the realities on the ground suggests that the mindset ruling the strategy is impervious indeed. It recalls a remark directed at General Petraeus by his superior, Admiral William Fallon [34] (commander of Centcom) in their final meeting in Baghdad, in March 2007 - "an ass-kissing little chicken-shit" (see Gareth Porter, "US-Iraq: Fallon Derided Petraeus, Opposed the Surge [35]", Interpress Service, 12 September 2007). It is in these unguarded soldiering words that the most unvarnished assessment of the ethos that animates Washington's latest pronouncements on Iraq may lie.

Note: The author would like to thank his postgraduate research assistant, Chris Langille, who provided editorial suggestions and helpful comments

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[1] http://www.ft.com/cms/s/0/08fcfbb6-6537-11dc-bf89-0000779fd2ac.html
[2] http://www.politico.com/news/stories/0907/5735.html
[3] http://www.poli.ucalgary.ca/Ismael.htm
[4] http://www.intellectbooks.co.uk/journalissues.php?issn=17512867&v=1&i=1
[5] http://www.upf.com/book.asp?id=ISMAEF01
[6] http://www.plutobooks.com/cgi-local/nplutobrows.pl?chkisbn=9780745321479a&main=&second=&third=&foo=../ssi/ssfooter.ssi
[7] http://www.plutobooks.com/cgi-local/nplutobrows.pl?chkisbn=9780745321493&main=&second=&third=&foo=../ssi/ssfooter.ssi
[8] http://www.versobooks.com/books/cdef/c-titles/cockburn_p_the_occupation.shtml
[9] http://www.theatlantic.com/doc/200709u/petraeus-bing-west
[10] http://www.aljazeera.com/news/newsfull.php?newid=37876
[11] http://www.mnf-iraq.com/index.php?option=com_content&task=view&id=23&Itemid=16
[12] http://www.msnbc.msn.com/id/20763040/
[13] http://news.independent.co.uk/people/profiles/article2941917.ece
[14] http://news.independent.co.uk/world/americas/article2956422.ece
[15] http://www.tomdispatch.com/post/174834/launching_brand_petraeus
[16] http://www.whitehouse.gov/infocus/iraq/iraq_strategy_nov2005.html
[17] http://iraq.usembassy.gov/iraq/ambassador.html
[18] http://deseretnews.com/dn/view/0,1249,515039782,00.html
[19] http://www.washingtonpost.com/wp-dyn/content/article/2007/09/09/AR2007090901982.html
[20] http://www.gwu.edu/%7Ensarchiv/NSAEBB/NSAEBB198/index.htm
[21] http://www.washingtonpost.com/wp-dyn/content/article/2007/09/09/AR2007090901982_pf.html
[22] http://uk.reuters.com/article/homepageCrisis/idUKL03336451._CH_.242020070703
[23] http://www.energybulletin.net/559.html
[24] http://www.upi.com/International_Security/Energy/Analysis/2007/09/18/analysis_iraq_oil_and_greenspans_gospel/1478/
[25] http://www.penguin.co.uk/nf/Book/BookDisplay/0,,9780713999822,00.html
[26] http://www.guardian.co.uk/usa/story/0,,2170661,00.html
[27] http://www.alternet.org/waroniraq/62784/
[28] http://www.latimes.com/news/nationworld/world/la-fg-pullback15aug15,0,1634199,full.story?coll=la-home-center
[29] http://www.mcclatchydc.com/227/story/19566.html
[30] http://www.theaustralian.news.com.au/story/0,25197,22366787-2703,00.html
[31] http://www.washingtonpost.com/wp-dyn/content/article/2007/08/29/AR2007082902434.html?hpid=topnews
[32] http://www.csis.org/component/option,com_csis_progj/task,view/id,1028/
[33] http://www.airforcetimes.com/news/2007/09/military_newprogressreport_070917/
[34] http://www.navy.mil/navydata/bios/navybio.asp?bioID=109
[35] http://ipsnews.net/news.asp?idnews=39235



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Kurds Denounce US detention of Iranain

US arrogance is almost beyond belief. Even the Kurds, the staunchest allies of the US in Iraq are subjected to the utmost in humiliation. The Iranian is a member of a trade delegation. The Iranian Revolutionary Guard has numerous business and corporate interests in Iran so it is hardly surprising that he would be part of a trade mission. You can hardly blame the Kurds if they doublecross the US whenever it seems in their interest to do so. The US could care less about the Kurd's interests or anyone elses when it feels it is not in their own interest. The US continues to hold other Iranians nabbed earlier in Erbil who worked in a quasi-diplomatic mission. In spite of the Iraq govt. pleading for their release nothing has happened.. These outrages seem to just disappear from media radar.

Kurds denounce U.S. detention of Iranian
By Jay Price and Yaseen Taha | McClatchy Newspapers
Posted on Thursday, September 20, 2007 SULAIMANIYAH, Iraq — U.S. troops arrested an Iranian man during an early morning raid on a hotel in this northern Iraqi city Thursday and accused him of helping to smuggle a deadly type of roadside bomb into Iraq.

But the Kurdistan Regional Government in a statement called the arrest "illegitimate," said the man was a member of a trade delegation that had been invited to Sulaimaniyah by the local government and demanded that he be released.

"Actions like these serve no one," the statement said.

The United States has detained several Iranians in Iraq in the past year and accused them of training Iraqi insurgents and providing weapons to them. In January it took five Iranians into custody in Irbil, the Kurdish regional capital, and accused them of being members of the Iranian military. They're still being held. Eight other Iranians who were detained last month in Baghdad were quickly released, however.

The U.S. statement didn't identify the man except to allege that he is an officer in the Iranian Revolutionary Guard Corp's elite Quds force. The statement said intelligence indicated that the man had trained foreign fighters in Iraq and provided them with roadside bombs known as explosively formed penetrators, or EFPs. EFPs fire a molten jet of metal through vehicles' armor and are much feared by U.S. troops.

The Kurdish Regional Government said the man was Aghai Farhadi, a member of an economic and commercial delegation from the Iranian governorate of Karmanshah, which borders Iraq's Sulaimaniyah and Diyala provinces.

Hassan Baqi, the head of the Sulaimaniyah chamber of commerce, said Farhadi had been in Sulaimaniyah for a week for discussions on opening a border crossing near Panjween,68 miles east of Sulaimaniyah, and other trade-related issues.

It was unknown what evidence, if any, American troops recovered when they seized the man at the Sulaimaniyah Palace Hotel. Saifudean Ahmed, Sulaimaniyah's security director, said 20 U.S. soldiers took part in the arrest. Witnesses said helicopters hovered over the scene for two hours.

Kurdish officials were quick to distance themselves from the detention.

"We had no prior knowledge of the detention of a member of the Iranian commercial delegation," Sulaimaniyah police chief Gen. Zarkar Alia said in a statement. "We heard of the incident from unofficial sources. The operation was carried out without coordination with us, the security forces or the authorities in Sulaimaniyah."

Sulaimaniyah is one of the main cities in Iraqi Kurdistan, which has its own tensions with Iran. The Iranian military has been bombarding mountain villages on the Iraqi side of the border, allegedly to combat Kurdish separatist guerrillas who the Iranians say have taken refuge there.

Kurdish and Iraqi officials have demanded that Iran stop the bombardment, saying Iran should fight Kurdish rebels in Iran.

(Price reports for the (Raleigh) News & Observer. Taha is a McClatchy special correspondent. Leila Fadel in Baghdad contributed to this report.)

McClatchy Newspapers 2007

Checkbook imperialism: The Blackwater Fiasco

It seems that there is a surge in contractors that has brought them to a level in Iraq that is larger than US troops. It will be interesting to see how all of this pans out. The US is not about to do away with its guards and in order to provide profits for Bush cronies and others there is no longer the manpower within the armed forces to provide these services.
Imagine the gall of Blackwater:
We have become the most responsive, cost-effective means of affecting the strategic balance in support of security and peace, and freedom and democracy everywhere.”
Translated that means that the company profits from US imperialism everywhere.

Checkbook Imperialism: The Blackwater Fiasco



Posted on Sep 18, 2007

iraqfact.com

By Robert Scheer

Please, please, I tell myself, leave Orwell out of it. Find some other, fresher way to explain why “Operation Iraqi Freedom” is dependent upon killer mercenaries. Or why the “democratically elected government” of “liberated” Iraq does not explicitly have the legal power to expel Blackwater USA from its land or hold any of the 50,000 private contractor troops that the U.S. government has brought to Iraq accountable for their deadly actions.

Were there even the faintest trace of Iraqi independence rising from the ashes of this failed American imperialist venture, Blackwater would have to fold its tents and go, if only in the interest of keeping up appearances. After all, the Iraqi Interior Ministry claimed that the Blackwater thugs guarding a U.S. State Department convoy through the streets of Baghdad fired “randomly at citizens” in a crowded square on Sunday, killing 11 people and wounding 13 others. So the Iraqi government has ordered Blackwater to leave the country after what a government spokesman called a “flagrant assault ... on Iraqi citizens.”

But who told those Iraqi officials that they have the power to control anything regarding the 182,000 privately contracted personnel working for the U.S. in Iraq? Don’t they know about Order 17, which former American proconsul Paul Bremer put in place to grant contractors, including his own Blackwater bodyguards, immunity from Iraqi prosecution? Nothing has changed since the supposed transfer of power from the Coalition Provisional Authority, which Bremer once headed, to the Iraqi government holed up in the Green Zone and guarded by Blackwater and other “private” soldiers.

They are “private” in the same fictional sense that our uniformed military is a “volunteer” force, since both are lured by the dollars offered by the same paymaster, the U.S. government. Contractors earn substantially more, despite $20,000 to $150,000 signing bonuses and an all-time-high average annual cost of $100,000 per person for the uniformed military. All of this was designed by the neocon hawks in the Pentagon to pursue their dreams of empire while avoiding a conscripted army, which would have millions howling in the street by now in protest.

Instead, we have checkbook imperialism. The U.S. government purchases whatever army it needs, which has led to the dependence upon private contract firms like Blackwater USA, with its $300-million-plus contract to protect U.S. State Department personnel in Iraq. That is why the latest Blackwater incident, which Prime Minister Nouri al-Maliki branded a “crime,” is so difficult to deal with. Iraqis are clearly demanding to rid their country of Blackwater and other contractors, and on Tuesday the Iraqi government said it would be scrutinizing the status of all private security firms working in the country.

But the White House hopes the outrage will once again blow over. As the Associated Press reported on Monday: “The U.S. clearly hoped the Iraqis would be satisfied with an investigation, a finding of responsibility and compensation to the victim’s families—and not insist on expelling a company that the Americans cannot operate here without.” Or, as Ambassador Ryan Crocker testified to the U.S. Senate last week: “There is simply no way at all that the State Department Bureau of Diplomatic Security could ever have enough full-time personnel to staff the security function in Iraq. There is no alternative except through contracts.”

Consider the irony of that last statement—that the U.S. experiment in building democracy in Iraq is dependent upon the same garrisons of foreign mercenaries that drove the founders of our own country to launch the American Revolution. As George Washington warned in his farewell address, once the American government enters into these “foreign entanglements,” we lose the Republic, because public accountability is sacrificed to the necessities of war for empire.

Despite the fact that Blackwater USA gets almost all of its revenue from the U.S. government—much of it in no-bid contracts aided, no doubt, by the lavish contributions to the Republican Party made by company founder Erik Prince and his billionaire parents—its operations remain largely beyond public scrutiny. Blackwater and others in this international security racket operate as independent states of their own, subject neither to the rules of Iraq nor the ones that the U.S. government applies to its own uniformed forces. “We are not simply a ‘private security company,’ ” Blackwater boasts on its corporate website. “We are a professional military, law enforcement, security, peacekeeping, and stability operations firm. ... We have become the most responsive, cost-effective means of affecting the strategic balance in support of security and peace, and freedom and democracy everywhere.”

Yeah, so who elected you guys to run the world?

Saudi involvement in Iraq Overlooked

This is just part of a longer article at antiwar.com
Most commentators do not even not the disparity between US treatment of Iran's helping Shiites in Iraq and Saudi's aid to Sunnis and also their meddling in Kurdistan, a topic treated in the second half of the article.


The Royal Treatment: Saudi Involvement in Iraq Overlooked

by Dahr Jamail
Reporting on Iraqi benchmarks in mid-September, Bush and his team of Gen. Petraeus and Ambassador Crocker sought to pin some of the blame on Iran. Eschewing diplomatic language during his testimony, Crocker boldly said, "Iran plays a harmful role in Iraq." Gen. David Petraeus added that Iran is fighting a "proxy war" in Iraq by aiding Shi'ite extremists and providing weapons that are killing American troops.

Anyone doubting that Bush is not serious about taking on Tehran should note his words from last month: "We will confront this danger before it is too late." On September 17 the Telegraph reported that the Pentagon has already drawn up plans for massive airstrikes against 2,000 targets across Iran.

The great irony is that while these accusations towards Tehran are supported by thin evidence, plenty of evidence does exist that another of Iraq's neighbors, U.S.-ally Saudi Arabia, is supporting resistance groups in Iraq, and intends to continue to do so.

A Neighborly Mess: Iraq, Iran and Saudi Arabia
"Saudi Arabia has both the means and the religious responsibility to intervene [in Iraq]," wrote Nawaf Obaid, neoconservative ally and a former security advisor to the Saudi government, in a shockingly frank editorial for the Washington Post last November. He warned the Bush administration, sinking ever deeper into the quagmire of Iraq: "America must not ignore the counsel of Prince Turki al-Faisal, Saudi Arabia's ambassador to the United States. If it does, one of the first consequences will be massive Saudi intervention to stop Iranian-backed Shi'ite militias from butchering Iraqi Sunnis."

Obaid's warning, in response to talk of a possible U.S. withdrawal from Iraq, noted the current Saudi political stance "I am my brothers' keeper" towards fellow Sunni Arabs in Iraq. Clearly the Saudis do not consider all Iraqis their brothers, particularly the Shi'ites.

The editorial said, "As the economic powerhouse of the Middle East, the birthplace of Islam and the de facto leader of the world's Sunni community, constituting 85 percent of all Muslims, Saudi options are to provide Sunni military leaders (primarily members of the former Iraqi officer corps, who make up the backbone of the insurgency) with the same types of assistance – funding, arms and logistical support – that Iran has been giving to Shi'ite armed groups for years or to help establish new Sunni brigades to combat the Iranian-backed militias."

Obaid admitted that Saudi involvement in Iraq carried great risk and "...could spark a regional war but the consequences of inaction are far worse" and that his country "had pressed other members of the Gulf Cooperation Council...Qatar, the United Arab Emirates, Kuwait, Bahrain and Oman – to give financial support to Sunnis in Iraq."

Arming the Neighborhood
In August, the Bush administration announced new arms packages for Israel and seven Arab nations comprising military equipment worth $20 billion to Saudi Arabia, over $30 billion in military assistance to Israel, and $13 billion to Egypt."

To some extent, the arms packages are an extension of the same policies that have been in place for years in the Middle East. For example since 1998, Saudi Arabia alone has received over $15 billion in U.S. weapons.

But these sales have had little impact in the region other than arming everyone to the teeth. In her article, "The Saudi Arms Deal: Congressional Opposition Grows," Rachel Stohl points out that "The United States has had little success in the past using arms sales to buy leverage in the region. "

From Washington's viewpoint the sale has two objectives: bucking up the Saudi-dominated six-member Gulf Cooperation Council and countering Iran's influence. But the sales will likely cause Iran to respond by boosting its arms caches.

A dangerous side effect of the sales is the addition of more arms into a region where each country has distinct objectives in the region and inside Iraq. The sales set the stage for Iraq to be the flashpoint for a potential proxy and/or regional war.

But most dangerously for Iraqis and U.S. troops, the sales reward a country that is providing an estimated 45% of all foreigners fighting U.S. troops and Iraqi government forces.

Destabilizing Iraq: The Saudi Role
A "clear" view of Iraq is now visible only through a blood-soaked kaleidoscope of contradictory and conflicting U.S. policies. While the Bush administration regularly lashes out at Syria and Iran for aiding militias and foreign fighters in Iraq, according to official U.S. military figures reported in the Los Angeles Times on July 15, about 45% of all foreign militants targeting U.S. troops and Iraqi civilians and security forces are from Saudi Arabia. Fighters from the kingdom are believed to have carried out the majority of suicide bombings in Iraq.

Who is to blame for the influx of fighters though? Gen. Mansour Turki, a spokesman for the Saudi Interior Ministry, however, blames forces inside of Iraq for the flow of Saudi human bombs into Iraq. If he is to be believed, "Saudis are actually being misused. Someone is helping them come to Iraq. Someone is helping them inside Iraq. Someone is recruiting them to be suicide bombers. We have no idea who these people are. We aren't getting any formal information from the Iraqi government." But Iraqis are quick to point the finger across the border. Lawmaker Sami Askari, an advisor to Prime Minister Nouri al-Maliki, accuses Saudi officials of following a deliberate policy of sowing chaos in Baghdad: "The fact is that Saudi Arabia has strong intelligence resources, and it would be hard to think that they are not aware of what is going on."

Askari claims that imams at Saudi mosques regularly call for jihad against Iraq's Shi'ites and that the Saudi government had funded groups to cause chaos and bloodshed in Iraq's predominantly Shi'ite south.

But in large part this continues to be conveniently overlooked by the Bush administration so that massive arms packages can be sold to Saudi Arabia, access to the vast oil reserves continues unabated, and the Saudi royal family's long-standing connections to the Bush family remain unmentioned in mainstream circles.

There are the odd rare days, however, when the boat does get rocked.

Just days before the $20 billion arms package was handed to the Saudi monarchy, Bush administration officials voiced their anger at the "counterproductive" role of Saudi Arabia in Iraq. They accused Saudi Arabia of regarding Maliki as an Iranian agent and actively working to undermine his government and for offering financial backing to various Sunni groups inside Iraq.

Zalmay Khalilzad, former U.S. Ambassador to Iraq and presently the U.S. ambassador to the UN, wrote in the New York Times recently, "Several of Iraq's neighbors, not only Syria and Iran but also some friends of the United States, are pursuing destabilizing policies there."

But this is the exception rather than the rule. The cozy relationship between Washington and Riyadh continues, largely unscathed

Inspector General Accused of avoiding probes

This sounds like a typical coverup scenario. The Inspector General is just doing his job protecting Bush and his corporate buddies who are profiting from the war.

State IG Accused of Averting Probes

By Glenn Kessler and Karen DeYoung
Washington Post Staff Writers
Wednesday, September 19, 2007; A21



Howard J. Krongard, the State Department's inspector general, has repeatedly thwarted investigations into contracting fraud in Iraq and Afghanistan, including construction of the U.S. Embassy in Baghdad, and censored reports that might prove politically embarrassing to the Bush administration, the chairman of the House Committee on Oversight and Government Reform charged yesterday in a 13-page letter.

The letter, addressed to Krongard and signed by the committee chairman, Henry A. Waxman (D-Calif.), who released it yesterday, said the allegations were based on the testimony of seven current and former officials on Krongard's staff, including two former senior officials who allowed their names to be used, and private e-mail exchanges obtained by the committee. The letter said the allegations concerned all three major divisions of Krongard's office -- investigations, audits and inspections.

Waxman demanded documents and testimony for a hearing next month into Krongard's conduct. A copy of the letter was sent to the committee's top Republican, Rep. Thomas M. Davis III (Va.).

A statement released by Krongard's office said he had just completed a visit to Afghanistan and was "en route to Baghdad for the remainder of September." In the statement, he described the allegations as "replete with inaccuracies including those made by persons with their own agendas" and said he looks forward to the opportunity to respond fully to the committee. White House spokeswoman Dana Perino referred questions to the State Department, where spokesman Sean McCormack said he had not yet seen Waxman's letter.

The letter alleges that Krongard "interfered with ongoing investigations to protect the State Department and the White House from political embarrassment." It said that "your strong affinity with State Department leadership and your partisan political ties have led you to halt investigations, censor reports and refuse to cooperate with law enforcement agencies."

The Senate confirmed President Bush's nomination of Krongard, who had no previous State Department experience, in May 2005. He previously worked for an international law firm and had been general counsel for Deloitte & Touche in the mid-1990s. Federal Election Commission records indicate he has contributed to both parties: $1,350 to the National Republican Senatorial Committee in 2000, for a "roast" of then-Michigan Gov. John Engler (R), and $1,000 to Democratic presidential candidate Bill Bradley in 1999. Krongard's brother, A.D. "Buzzy" Krongard, served as the No. 3 CIA official under then-Director George J. Tenet.

Waxman accused Howard Krongard of:


¿ Refusing to send investigators to Iraq and Afghanistan to investigate $3 billion worth of State Department contracts.


¿ Preventing his investigators from cooperating with a Justice Department probe into waste and fraud in the construction of the U.S. Embassy in Baghdad.


¿ Using "highly irregular" procedures to personally exonerate the embassy's prime contractor of labor abuses.


¿ Interfering in the investigation of a close friend of former White House adviser Karl Rove.


¿ Censoring reports on embassies to prevent full disclosure to Congress.


¿ Refusing to publish critical audits of State's financial statements.

Among the e-mails obtained by the committee are exchanges in which staff members discussed Krongard's decision not to cooperate with the Justice Department on the embassy investigation.

"Wow, as we all [k]now that is not the normal and proper procedure," an investigator wrote to John A. DeDona, an assistant inspector general. DeDona forwarded the e-mail to Deputy Inspector General William E. Todd, saying, "I have always viewed myself as a loyal soldier but hopefully you sense my frustration in my voicemail yesterday."

Todd wrote back: "I know you are very frustrated. John, you need to convey to the troops the truth, the IG told us both Tuesday to stand down on this and not assist, that needs to be the message."

DeDona responded: "Unfortunately, under the current regime, the view within INV [the office of investigations] is to keep working the BS cases within the beltway, and let us not rock the boat with more significant investigations."

Waxman's letter also said that Krongard's actions have resulted in a "dysfunctional office environment in which you routinely berate and belittle personnel, show contempt for the abilities of career government professionals and cause the staff to fear coming to work." The letter said high personnel turnover has left the office with many senior-level vacancies and only seven of 27 investigator positions filled.

The embassy, whose cost of more than $600 million has made it the most expensive U.S. diplomatic mission in the world, has been the subject of repeated congressional questioning and allegations of wrongdoing in both construction and hiring practices

Blackwater Guards Fired First: Iraqi Report

This is from the NY Times op eds. These are now available to everyone. Hurrah! Without Blackwater US diplomatic missions will be grounded since Blackwater protects them. Most commentators have no criticism of the fact that private contractors are beyond the reach of Iraqi law in cases such as these.

Iraqi Report Says Blackwater Guards Fired First


By SABRINA TAVERNISE and JAMES GLANZ
Published: September 19, 2007
BAGHDAD, Sept. 18 — A preliminary Iraqi report on a shooting involving an American diplomatic motorcade said Tuesday that Blackwater security guards were not ambushed, as the company reported, but instead fired at a car when it did not heed a policeman’s call to stop, killing a couple and their infant.


The Reach of War
» The report, by the Ministry of Interior, was presented to the Iraqi cabinet and, though unverified, seemed to contradict an account offered by Blackwater USA that the guards were responding to gunfire by militants. The report said Blackwater helicopters had also fired. The Ministry of Defense said 20 Iraqis had been killed, a far higher number than had been reported before.

In a sign of the seriousness of the standoff, the American Embassy here suspended diplomatic missions outside the Green Zone and throughout Iraq on Tuesday.

“There was not shooting against the convoy,” said Ali al-Dabbagh, the Iraqi government’s spokesman. “There was no fire from anyone in the square.”

A State Department spokesman, Edgar Vasquez, said he had not heard of the report and repeated that the department was conducting an investigation supported by the American military. A spokeswoman for Blackwater did not respond to an e-mail request for comment.

“Let these folks do the investigation and get all the facts,” Mr. Vasquez said, “and if department procedures were not followed, after the facts have been gathered we would decide what action to take.”

The shooting, which took place on Sunday, has angered Iraqi officials and touched off a harsh debate about private security companies, which operate outside Iraqi law, a privilege extended to them by Americans officials while Iraq’s government was still under American administration. Blackwater, which guards all top American officials here, had its work suspended, and Iraqi officials agreed to rewrite the rules to make the companies accountable.

“We do understand that the security companies are subject to high levels of threat and they do a good job at protection, but this does not entitle them to immunity from Iraqi laws,” Mr. Dabbagh said. “This is what the Iraqi government would like to review.”

He said the Iraqi and American governments had set up a joint committee to investigate the deaths.

American Embassy officials had said Monday that the Blackwater guards had been responding to a car bomb, but Mr. Dabbagh said the bomb was so far away that it could not possibly have been a reason for the convoy to begin shooting.

Instead, he said, the convoy had initiated the shooting when a car did not heed a police officer and moved into an intersection.

“The traffic policeman was trying to open the road for them,” he said. “It was a crowded square. But one small car did not stop. It was moving very slowly. They shot against the couple and their child. They started shooting randomly.”

In video shot shortly after the episode, the child appeared to have burned to the mother’s body after the car caught fire, according to an official who saw it.

In interviews on Tuesday, six Iraqis who had been in the area at the time of the shooting, including a man who was wounded and an Iraqi Army soldier who helped rescue people, offered roughly similar versions.

The Iraqi soldier, who said he was standing at a checkpoint on the edge of the square, said he thought the convoy believed the small car was a suicide bomber and opened fire. According to the wounded man, recuperating in Yarmouk Hospital, the car with the family was driving on the wrong side of the road.

Naomi Klein: Disaster capitalism in Iraq

As far as US contractors are concerned Iraq has been a gold mine in spite of all the problems with security. In fact the security situation has meant that the contractors can charge higher fees for doing everything.
Recently however Blackwater has gone beyond the pale it seems and may be turfed out of Iraq. But they may be regarded as so essential that the US will resist moves to evict them. Of course there can be no charges against them. This makes disaster capitalism safe from nasty lawsuits on the part of Iraqis.

It may have been the military that invaded but, with Iraq completely dismantled, the reconstruction was to be the preserve of US corporations ... Thus was born 'disaster capitalism', where oil companies profit from a broken country and private security firms grow rich on political chaos, says Naomi Klein in this final extract from her new book

Wednesday September 12, 2007
The Guardian




On my flight leaving Baghdad, every seat was filled by a foreign contractor fleeing the violence. It was April 2004, and both Falluja and Najaf were under siege; 1,500 contractors pulled out of Iraq that week alone. Many more would follow. At the time, I was convinced that we were seeing the first full-blown defeat of the corporatist crusade. Iraq had been blasted with every shock weapon short of a nuclear bomb, and yet nothing could subdue this country. The experiment, clearly, had failed.
Now I am not sure. On one level, there is no question that parts of the project were a disaster. US chief envoy Paul Bremer was sent to Iraq to build a corporate utopia; instead, Iraq became a ghoulish dystopia where going to a simple business meeting could get you lynched, burned alive or beheaded. By May 2007, more than 900 contractors had been reported killed and "more than 12,000 wounded in battle or injured on the job", according to a New York Times analysis. The investors Bremer had done so much to attract had never showed up - neither HSBC, nor Procter & Gamble, which put its joint venture on hold, as did General Motors. New Bridge Strategies, the company that had gushed about how "a Wal-Mart could take over the country", conceded that "McDonald's is not opening any time soon". Bechtel's reconstruction contracts did not roll easily into long-term contracts to run the water and electricity systems. And by late 2006, the privatised reconstruction efforts that were at the centre of the "anti-Marshall Plan" [by which western corporations would remake Iraq in their own image rather than help Iraqis rebuild their own economy, as the US did in Germany after the second world war], had almost all been abandoned. And some rather dramatic policy reversals were in evidence.

Stuart Bowen, US special inspector general for the reconstruction of Iraq, reported that in the few cases where contracts were awarded directly to Iraqi firms, "it was more efficient and cheaper. And it has energised the economy because it puts the Iraqis to work". It turns out that funding Iraqis to rebuild their own country is more efficient than hiring lumbering multinationals who don't know the country or the language, surround themselves with $900- a-day mercenaries and spend as much as 55% of their contract budgets on overhead. Jon C Bowersox, who worked as the health adviser at the US embassy in Baghdad, offered this radical observation: the problem with Iraq's reconstruction, he said, was its desire to build everything from scratch. "We could have gone in and done low-cost rehabs, and not tried to transform their health-care system in two years."

An even more dramatic about-turn came from the Pentagon. In December 2006, it announced a new project to get Iraq's state-owned factories up and running - the same ones that Bremer had refused to supply with emergency generators because they were Stalinist throwbacks. Now the Pentagon realised that instead of buying cement and machine parts from Jordan and Kuwait, it could be purchasing them from languishing Iraqi factories, putting tens of thousands to work and sending revenue to surrounding communities. Paul Brinkley, US deputy under-secretary of defense for business transformation in Iraq, said, "We've looked at some of these factories more closely and found they aren't quite the rundown Soviet-era enterprises we thought they were", though he did admit that some of his colleagues had begun calling him a Stalinist.

Lieutenant General Peter W Chiarelli, the top US field commander in Iraq, explained that "we need to put the angry young men to work .... A relatively small decrease in unemployment would have a very serious effect on the level of sectarian killing going on." He couldn't help adding, "I find it unbelievable after four years that we haven't come to that realisation ...To me, it's huge. It's as important as just about any other part of the campaign plan."

Do these about-turns signal the death of disaster capitalism? Hardly. By the time US officials came to the realisation that they didn't need to rebuild a shiny new country from scratch, that it was more important to provide Iraqis with jobs and for their industry to share in the billions raised for reconstruction, the money that would have financed such an undertaking had already been spent.

Meanwhile, in the midst of the wave of neo-Keynesian epiphanies, Iraq was hit with the boldest attempt at crisis exploitation yet. In December 2006, the bipartisan Iraq Study Group fronted by James Baker issued its long-awaited report. It called for the US to "assist Iraqi leaders to reorganise the national oil industry as a commercial enterprise" and to "encourage investment in Iraq's oil sector by the international community and by international energy companies."

Most of the Iraq Study Group's recommendations were ignored by the White House, but not this one: the Bush administration immediately pushed ahead by helping to draft a radical new oil law for Iraq, which would allow companies such as Shell and BP to sign 30-year contracts in which they could keep a large share of Iraq's oil profits, amounting to tens or even hundreds of billions of dollars - unheard of in countries with as much easily accessible oil as Iraq, and a sentence to perpetual poverty in a country where 95% of government revenues come from oil. This was a proposal so wildly unpopular that even Bremer had not dared make it in the first year of occupation. Yet it was coming up now, thanks to deepening chaos. Explaining why it was justified for such a large percentage of the profits to leave Iraq, the oil companies cited the security risks. In other words, it was the disaster that made the proposed radical law possible.

Washington's timing was extremely revealing. At the point when the law was pushed forward, Iraq was facing its most profound crisis to date: the country was being torn apart by sectarian conflict with an average of 1,000 Iraqis killed every week. Saddam Hussein had just been put to death in a depraved and provocative episode. Simultaneously, Bush was unleashing his "surge" of troops in Iraq, operating with "less restricted" rules of engagement. Iraq in this period was far too volatile for the oil giants to make major investments, so there was no pressing need for a new law - except to use the chaos to bypass a public debate on the most contentious issue facing the country. Many elected Iraqi legislators said they had no idea that a new law was even being drafted, and had certainly not been included in shaping its outcome. Greg Muttitt, a researcher with the oil-watch group Platform, reported: "I was recently at a meeting of Iraqi MPs and asked them how many of them had seen the law. Out of 20, only one MP had seen it." According to Muttitt, if the law was passed, Iraqis "would lose out massively because they don't have the capacity at the moment to strike a good deal".

Iraq's main labour unions declared that "the privatisation of oil is a red line that may not be crossed" and, in a joint statement, condemned the law as an attempt to seize Iraq's "energy resources at a time when the Iraqi people are seeking to determine their own future while still under conditions of occupation". The law that was finally adopted by Iraq's cabinet in February 2007 was even worse than anticipated: it placed no limits on the amount of profits that foreign companies can take from the country and placed no specific requirements about how much or little foreign investors would partner with Iraqi companies or hire Iraqis to work in the oil fields.

Most brazenly, it excluded Iraq's elected parliamentarians from having any say in the terms for future oil contracts. Instead, it created a new body, the Federal Oil and Gas Council, which, according to the New York Times, would be advised by "a panel of oil experts from inside and outside Iraq". This unelected body, advised by unspecified foreigners, would have ultimate decision-making power on all oil matters, with the full authority to decide which contracts Iraq did and did not sign. In effect, the law called for Iraq's publicly owned oil reserves, the country's main source of revenues, to be exempted from democratic control and run instead by a powerful, wealthy oil dictatorship, which would exist alongside Iraq's broken and ineffective government.

It is hard to overstate the disgrace of this attempted resource grab. Iraq's oil profits are the country's only hope of financing its own reconstruction when some semblance of peace returns. To lay claim to that future wealth in a moment of national disintegration was disaster capitalism at its most shameless.

There was another, little discussed, consequence of the chaos in Iraq: the longer it wore on, the more privatised the foreign presence became, ultimately forging a new paradigm for the way wars are fought and how human catastrophes are responded to.

This is where the ideology of radical privitisation at the heart of the anti-Marshall Plan paid off handsomely. The Bush administration's steadfast refusal to staff the war in Iraq - whether with troops or with civilian administrators under its control - had some very clear benefits for its other war, the one to outsource the US government. This crusade, while it ceased to be the subject of the administration's public rhetoric, has remained a driving obsession behind the scenes, and it has been far more successful than all the administration's more public battles combined.

Because Rumsfeld designed the war as a just-in-time invasion, with soldiers there to provide only core combat functions, and because he eliminated 55,000 jobs in the Department of Defense and the Department of Veterans Affairs in the first year of the Iraq deployment, the private sector was left to fill in the gaps at every level. In practice, what this configuration meant was that, as Iraq spiralled into turmoil, an ever-more elaborate privatised war industry took shape to prop up the bare-bones army - whether on the ground in Iraq or back home treating soldiers at the Walter Reed Medical Centre in Washington.

Since Rumsfeld steadfastly rejected all solutions that required increasing the size of the army, the military had to find ways to get more soldiers into combat roles. Private security companies flooded into Iraq to perform functions that had previously been done by soldiers - providing security for top officials, guarding bases, escorting other contractors. Once they were there, their roles expanded further in response to the chaos. Blackwater's original contract in Iraq was to provide private security for Bremer, but a year into the occupation, it was engaging in all-out street combat. During the April 2004 uprising of Moqtada al-Sadr's rebel movement in Najaf, Blackwater actually assumed command over active-duty US marines in a day-long battle with the Mahdi Army, during which dozens of Iraqis were killed.

At the start of the occupation, there were an estimated 10,000 private soldiers in Iraq, already far more than during the first Gulf war. Three years later, a report by the US Government Accountability Office found that there were 48,000 private soldiers, from around the world, deployed in Iraq. Mercenaries represented the largest contingent of soldiers after the US military - more than all the other members of the "Coalition of the Willing" combined. The "Baghdad boom", as it was called in the financial press, took what was a frowned-upon, shadowy sector and fully incorporated it into the US and British war-fighting machines. Blackwater hired aggressive Washington lobbyists to erase the word "mercenary" from the public vocabulary and turn its company into an all-American brand. According to its CEO, Erik Prince, "This goes back to our corporate mantra: We're trying to do for the national security apparatus what FedEx did for the postal service."

When the war moved inside the jails, the military was so short of trained interrogators and Arabic translators that it could not get information out of its new prisoners. Desperate for more interrogators and translators, it turned to the defence contractor CACI International Inc. In its original contract, CACI's role in Iraq was to provide information technology services to the military, but the wording of the work order was vague enough that "information technology" could be stretched to mean interrogation. The flexibility was intentional: CACI is part of a new breed of contractor that acts as a temp agency for the federal government - it has ongoing, loosely worded contracts and keeps large numbers of potential workers on call, ready to fill whatever positions come up. Calling in CACI, whose workers did not need to meet the rigorous training and security clearances required of government employees, was as easy as ordering new office supplies; dozens of new interrogators arrived in a flash.

The corporation that gained most from the chaos was Halliburton. Before the invasion, it had been awarded a contract to put out oil fires set by Saddam's retreating armies. When those fires did not materialise, Halliburton's contract was stretched to include a new function: providing fuel for the entire nation, a job so big that "it bought up every available tanker truck in Kuwait, and imported hundreds more". In the name of freeing up soldiers for the battlefield, Halliburton took on dozens more of the army's traditional functions, including maintaining army vehicles and radios.

Even recruiting, long si