CounterPunch Special Report

Secret Bechtel Documents Reveal: Yes, It Is About Oil

By DAVID LINDORFF

Is the war against Iraq all about oil? Not to hear Defense Secretary Donald Rumsfeld tell it. Back on Nov. 15, he called the notion that oil was the real reason behind the Bush administration's drive against Saddam Hussein "nonsense," saying, "It has nothing to do with oil, literally nothing to do with oil."

But a new study released by the Institute for Policy Studies, based upon secret diplomatic cables just declassified by the National Archives, and internal communications of the Bechtel Corporation, suggests just the opposite?that oil is the underlying cause of this war.

The study, which discloses the intimate links between the Bechtel Corporation and Bechtel executives and U.S. policy towards Iraq, also shows that some key players in the push for America's war against Iraq, including Rumsfeld, Vice President Dick Cheney, and other former Reagan administration officials Roger Robinson, Judge William B. Clark and Robert McFarlane, have been intimately involved in issues relating to Iraqi oil as far back as the1980s.

Titled "Crude Vision: How Oil Interests Obscured US Government Focus on Chemical Weapons Use by Saddam Hussein," this report traces an intense effort by Reagan officials in the mid-OE80s to win Hussein's approval for a -billion oil pipeline to be built by Bechtel, running from the Euphrates oilfields in southern Iraq westward to Jordan and the Gulf of Aqaba.

A key player in that effort was Rumsfeld, then the CEO of Searle drugs, the giant phramaceutical company.

One particularly revealing 1983 memo, declassified for the first time in February by the National Archives, concerns a trip by Rumsfeld to Iraq. Acting as a special White House "peace envoy" allegedly to discuss with Hussein and then foreign minister Tarik Aziz the bloody war between Iran and Iraq, Rumsfeld turns out according to this memo to have been talking not about that war, but about Bechtel's proposed Aqaba pipeline.

In his memo to Secretary of State George Schultz reporting on the meeting with Hussein, Rumsfeld talks at length about the pipeline discussion, but makes no mention of having discussed either the war or charges that Hussein's army was using chemical weapons against the Iranians.

The intense focus of Rumsfeld, Schultz (a former president of Bechtel), Cheney and other Reagan officials, in concert with Bechtel, on the pipeline, reads like an abbreviated, or mini "Pentagon Papers," laying the groundwork for a collapse in relations between the U.S. and Iraq, and eventually to

war. The documents also cast Bechtel's current position as one of two top candidates for the lucrative contract to "rebuild Iraq" in a troubling light.

As American troops press into Baghdad, and Iraqi casualties run into the thousands, Counterpunch speaks with Jim Valette, director of research at the Sustainable Energy and Economy Network, and one of the three authors of "Crude Vision."

Q: What prompted this study?

A: We were examing the interconnections between private corporations and the U.S. government in the pursuit of oil worldwide since 1995--principally the U.S. financing --through the World Bank and US agencies like the Export-Import Bank and the Overseas Private Investment Corporation (OPIC), etc.?of that pursuit. But what has clearly occurred in recent months has been clearly an even more serious expression of this pursuit of fossil fuels for the benefit of Big Oil, which is an extention of this relation into the military role. And so we're looking at the deployment of troops and paramilitaries financed by the U.S. government worldwide, and of course the most serious conflict of interest is in Iraq. In the course of that research we saw the beginning and end of the story of American efforts to gain control of Iraq's oilfields, the beginning being Rumsfeld's meeting with Saddam Hussein in Deecemer 1983 to the end, which was the Independent Counsel's investigation of the Attorney General, at the time, Edwin Meese, and his relationship with one of the brokers of the pipeline, E Robert Wallachs. Before this nobody had connected the dots between Rumsfeld and the Meese investigation and nobody had examined exactly how dominant this pipeline project was in the diplomacy and the burgeoning relationship between the Reagan administration and Saddam Hussein. It was in that context that we came across corporate records and government memoranda related to the Aqaba pipeline project. It was a real eye-opener to us to see how interwomen Bechtel's interests were with the Reagan Administration.

Q. We1re talking about stuff that happened almost 20 years ago. How is this relevant to what's happening in Iraq now?

A: This story, I think, is timely even though it's 20 years old because Bechtel is back now, as the likely winner of the contract to rebuild Iraq's infrastructure, and many of those Reagan administration officials are back, and they are poised to get their hands on Iraq's oil again.

Q: So what is new here?

A: The release in February by the National Archives of cables back and forth between Washington and U.S. diplomats in the Middle East around the time of 1983 and 1984 disclose for the first time what really transpired in Rumsfeld's meetings with Saddam and other Iraqi officials. What had previously been reported was that Rumsfeld had a cozy meeting with Saddam in Baghdad in December 1983. In the past, the focus was on whether or not he had raised the issue of Saddam's use of chemical arms against Iran. But what the actual memoranda show is that a big part of Rumsfeld's discussion with Saddam Hussein was this new proposal from Bechtel to build a pipeline form Iraq to Jordan. I mean Rumsfeld was executing the marching

orders of George Schultz, who was the Secretary of State, but who came directly from the presidency of Bechtel to the Reagan administration. The documents released by the National Security Archive suggest that what was going on then had quite a bit to do with oil--certainly more than had been known before.

Q: Before the release of those documents we didn't know that Rumsfeld was talking about a pipeline?

A: Right. Right. I mean it was reported that when he was there he didn't raise an issue with Saddam about the use of chemical weapons, even though there were reports coming out of Iran that Saddam was dropping chemical bombs on Iranian troops.

Q: So we knew before what he didn't talk about, but not what he was talking about?and that was the pipeline?

A: .Right, he was there sort of as a bagman for Bechtel. And then there were documents I found in the government's National Archives that showed the extensive involvement of Reagan officials and the very close relationship they had with Bechtel officials, in pursuing this pipeline over the next two years. We sort of connected the dots between what was in these National Security Archives and what was known in the general coverage over the last 15 years.

Q: How important was this pipeline in terms of relations?

A: It was the focus of U.S. relations with Iraq for several years, right through the period that Iraq was locked in a bitter war with Iran. In one 1984 internal company memo, Bechtel executive H. B. Scott exhorts his colleagues at Bechtel, after it appeared that all this diplomacy by Rumsfeld seemed to be paying off, "I cannot emphasise enough the need for maximum

Bechtel management effort at all levels of the U.S. government and industry to support this project. It has significant political overtones. The time may be ripe for this project to move promptly with very significant rewards to Bechtel for having made it possible." And in these documents we see how tightly interwoven this management effort is with their former colleagues such as George Schultz in the State Department in implementing this initiative. It shows how corporations take advantage of U.S. geopolitics in the region and how they try to profit from those geopolitical developments. Another important memo was in July of 1985, after Bechtel had run into some difficulties in assuaging Saddam's fears about potential Israeli threats to the pipeline. Bechtel and the State Department were having trouble getting the right degree of assurance from the Isreaeli Labor Party [then the ruling party in Israwl] that the pipeline would be off limits to attack. Bechtel and the Reagan administration officials were trying to get absolute assurance from the Labor Party that the pipeline would absolutely not be

attacked. There were some frustrations to that approach in 1985, and so Bechtel hired a couple of very close friends of the Reagan administration to sort out the deal. In July of 1985, pipeline promoters hired Judge Jim Clark, who was considered Reagan's right hand man. He had just left government to go into private business. There's a memo from Judge Clark saying that he's "on board" and laying out the terms of his involvement, which were 0 an hour, and saying he'd be flying to Baghdad, not as a private consultant, but representing himself as a White House representative. That memorandum, which is avialable on our website (), shows how blurry that revolving door had become. He's working for the government while he's simultaneously getting paid as an agent for Bechtel.

Q: Okay, so we have the evidence that there was this big concern about getting this big pipeline for Bechtel, and the interest in getting oil out without it having to go through the Persian Gulf. But wasn't that a legitimate national security concern for the U.S., given Iran's political situation and its hostility towards America?

A: Well, it has been long-standing US national security policy on paper

that threats to the free flow of oil are threats to national security, and this is what we're getting at here. Is this pursuit of oil or the pursuit of empire? Some folks define what's going on in Iraq as U.S. pursuit of empire, but right now it's really two sides of the same coin. And this policy of

pursuing oil and empire is coming up against all sorts of realities now that weren't well understood back in the 1980s. On the National security side, this pursuit of oil wealth at all costs has huge costs to democracy and human rights. It's creating a backlash in the Middle East and elsewhere that has had some horrible expressions recently.

Q: The pipeline never got built though. What happened?

A: In the end, Saddam decided that Bechtel was trying to charge too much for the project, and so he killed the project and instead went with a pipeline connecting into pipelines in Turkey and into Saudi Arabia, but avoiding the Straits of Hormuz.

Q: Do you expect to see the Aqaba pipeline revived?

A: Maybe, maybe not. I've seen reports now of Israel looking to build a pipeline from Iraq to the Golan Heights. It's not the same project as Bechtel's Aqaba pipeline idea. Bechtel asked the Commerce Department to keep the Aqaba pipeline registered as an active project for years, but it's probably less necessary now for the U.S. and Bechtel. The pipelines to Saudi Arabia and Turkey give an alternative route for oil to the Persian Gulf, and Bechtel gets into Iraq as a contractor to rebuild Iraq after the war. Right now, according to an article in the Wall Street Journal, Bechtel is one of the two finalists for the Iraq reconstruction job, along with Parson's group, which has Halliburton as a secondary contractor. Halliburton is Vice President Cheney's former company [Note: Cheney is still receiving payments from Halliburton]. That was reported in the Wall Street Journal

today (April 2). They're both on the short list. Halliburton sort of stepped back for obvious reasons but they1re still in there with Parsons.

A: Aside from the unseemly picture of two well connected companies getting an inside track for all that post-war business in Iraq, why do you find the Bechtel involvement in this situation so troubling?

Q: Schultz worked at Bechtel. So did (Reagan Defense Secretary) Caspar Weinberger. There were a lot of Bechtel people in the government in the '80s at the same time that the Iraqi's were gassing the Iranis. The same people are now formulating the plans for a coming U.S. occupation of Iraq, and in turn, the same people will be given the spoils of war--whether it's Parsons and Halliburton or Bechtel. It's all kind of circular back to the 1980s, you know -- completing unfinished business--getting American companies back in there after their being shut out since 1991 and the first Gulf War. Bechtel was also listed by Iraq in its report to the U.N. weapons inspectors as one of the companies that helped supply Saddam with equipment and knowledge for making chemical weapons. Bechtel in the 1980s was prime contractor on PC 1 and 2, two petrochemical plants constructed in Iraq which had dual-use capacity. So I guess the bottom line is that the Bush-Cheney-Rumsfeld squad are now holding Saddam Hussein accountable for chemical weapons of mass destruction--the same weapons which these same officials ignored in pursuit of the Aqaba pipeline project. And now we are going to reward the pipeline promoter with massive contracts for reconstruction resulting from this policy. There is just such hypocricy in all this.

Q: This all seems like a kind of mini-Pentagon Papers, laying out the early roots of this war.

A: It's not as much of a blue-print as was the Pentagon Papers, but these memos and documents do show how business gets done in Washington, how it was conducted in the 1980s and how it's probably being conducted now behind closed doors under secret bidding processes. And it shows how the origins of American conflict with Iraq involve control of and access to oil.

Q: Can you see any signs that the current war is linked directly to oil? I mean the administration has given so many reasons for going to war I'm surprised they haven't gotten to oil. I remember in 1991, the first Bush said it was about jobs, which equates pretty quickly to oil. But they didn't say that this time around.

A: Yeah, they've redacted any reference to oil from their language. Maybe that's the best evidence that that's what it's really about, because it's logical. I mean Bush the first in his national security papers defined the free flow of oil as a national security priority, as did President Clinton in his final months in office. He released a national security paper that said that the free flow of oil is a national security priority that must be enforced with military might if necessary. The current Bush came out with the national security strategy that redacted this long-standing text dating back to the Carter administration, but at the same time you had this Cheney energy policy that continues this idea of the necessity of a "diverse and free supply of oil" without the military language. And actually you had Cheney kind of kick off the whole war fever last August in a speech to the Veterans of Foreign Wars. He cited the specter of Saddam Hussein with his weapons of mass destruction threatening the flow of oil from the region. Then immediately afterwards, any kind of reference like that vanished from the Bush administration's rhetoric, to the point that Secretary of Defense Rumsfeld called any kind of association of the current conflict with oil to be an "absurdity." So there is no document or strategy paper now that says "we must invade

Iraq because our US oil companies have been shut out of this second largest reservoir of oil for the last 20 years," but who knows what we'll find in the National Archives 20 years from now? It's a circumstantial case, but that's as good as we can do now. And logic certainly has its place as well. I mean, the question is why are the weapons of mass destruction today a cause for war when these very same weapons were ignored by the same officials 20 years ago when they were being used. What has changed is that other national oil companies--French, Russian and Chinese--have gotten into Iraq, while U.S. companies were being frozen out. I'm sure there are other factors. Certainly the Kuwait invasion didn't help U.S relations with Saddam, and since Kuwait, Saddam signed very lucrative oil contracts with the French, Russians, Chinese and others.

Q: You made the point in your paper that US relations started to tank with Iraq after the rejection of the oil pipeline.

A: That's true. There was a shift away from Iraq to Iran right at that time, but I should say that Reagan and Bush the First both played both sides of the fence for a while, even after the pipeline project collapsed. You had the Iran Contra deal, but at the same time the U.S. was providing Iraq with intelligence about Iranian troop movements. And the U.S. did extend commodity credits through the Agriculture Department that Saddam then parlayed into arms. And there were the chemical plants that Bechtel helped build. So it's been quirkier than that. But certainly the end of the pipeline destroyed oil relations.

Q: What do you think led to the current war. What's the oil link?

A: Look at what's in Iraq and what's undeveloped. Iraq represents a major insurance package against any kind of political overhaul in Saudi Arabia or problems elsewhere in the Middle East. Look at the policy that people like Rumsfeld and others were recommending in the 1990s leading up to this war and they certainly cited the threat of Saddam Hussein to regional oil supplies as a cause for war. Certainly if the Bechtel pipeline had been built, the course of Iraqi-U.S. relations would have been much different. The failure of that pipeline set into motion a much different course for those relations.

A: So having control of Iraqi oil is still a key issue?

Q: It's the sole reason why the Persian Gulf region and Iraq have been a United States national security concern for so long. It's not geography.

Q: So what would you say is the lesson of all this?

A: The lesson is that when it comes to oil, a dictator is friendly to the U.S. when he's willing to do business and he's a mortal enemy when he's not. That has been the driving force behind national security policy, especially since the fall of the Soviet Union. Oil and national security policy were all submerged in the context of the Cold War. But once that Cold War collapsed, now it's a no-holds-barred battle for oil globally, and the U.S. has seen itself cut out of the world's second largest reserve of oil--and oil that is very inexpensive to extract. So with the U.S. shut out of Iraq, certainly it makes the trigger fingers of U.S. policy-makers itchy. And whether it's a blood feud or a war for oil, it's just a tragedy that the people of Iraq and our own sons and daughters and brothers and sisters are paying the price.

Dave Lindorff is the author of Killing Time: an Investigation into the Death Row Case of Mumia Abu-Jamal. A collection of Lindorff's stories can be found here: http://www.nwuphilly.org/dave.html

not so Joe?

Of course it is about Oil, Money, and Power. Why else do you think they kept going after each successive "excuse" was discredited?

What's the point in having secret documents if people keep finding them (mysteriously).

Try again, kiddo.

The US military budget is neary half of the whole budget. Think about where it comes from: You pay taxes, you work (if you got work). They spend it for military, arms and that stuff. - Now what does this mean? - There is not enough money for US schools, US medical care, US streets. - Who profits of this war? - All the enterprises involved in reconstruction of Iraq (many, many US enterprises, few british, few spanish). -Who profits of these entreprises? - their managers, bosses and owners. - And the workers? - No, they get the same salary as always. - And which people in the US should pay less taxes, accordint to Bush? - The entreprise bosses, managers and owners, the rich people.

Middleclass and poor americans pay for the war with their money and their kidsoldiers. And the rich ones earn the $$$ at the end of the war.

How can you support a goverment that does all this, that takes even the risk, that America could get terrorized by mad fanatic fundamentalists. (And believe me, the fine rich men will be in security, while normal citizens are afraid to lose their lives.)

If America doesn't wake up, americans one day have to be freed from their mighty strongmen. - but who will do that job?

It can't be!

The Illuminati told me so!

fu%k about the illuminati, its the thought, that economy can grow and grow and grow. Nobody realizes, that it just grows for few people. 350 people on this world has as much as the rest together. And you are not one of these 350.

...would you know that?

Actually, I'm thinking of buying all the Indymedia sites and selling "Tonight Show" videotapes.

Naaah. You guys are more entertaining.

http://www.truemajority.com/index.asp?action=2497&ms=txdy1&ref=274531

about 1/2 to the military

to protect corporate.. -I mean, American Interests

You mean the war was about stealing oil? I can't believe it! I thought we were fighting for freedom. Or was that fighting to find weapons of mass destruction. Or was that to protect democratic leaders like the Emir of Kuwait and Ariel "I can't do enough for the Arab Peasants" Sharon. I'm all confused. The latest story is that we were protecting the Iraqis from a tyranical government that used torture. But then why did we back the Shah of Iran? Why do we back the King of Saudi Arabia? Why are we backing the Turkish government, which tortures and murders Kurds? Why did we back Indonesia when it was massacring the people of East Timor? Why did we back various military dictatorships in South Korea for almost fifty years? How is it that we never found it necessary to invade South Africa when it was under Apartheid? Why did we train and finance the death squads in

El Salvador and Guatemala? Why did we help plan and finance the coup that brought Pinochet, the torturer and mass murderer, to power in Chile? I am sure that there must be some rational explanation for this, but the communists, those clever dastards, are somehow preventing our leader President Bush from explaining it to us.

2pesos: "introducing " democracy/freedom in the arab world goes a LLLLlllooooonnnnnnngggggggg Way in securing the u.s. against terrorist threats from the ME(radicalfundamentalislamists). Oil is interwoven, only.

...interwoven with Blood.

Where was all this concern for the Iraqi people when Saddam was butchering 1.5 million Iraqis? If yopu are so concerned about them, then you should be praising the fact that this militaryt action will save millions of lives going forward from the likes of Saddam and his sons, even if it is a byproduct of some purely economic conspiracy.

But that's really not where the concern is, is it? False reasoning to advance a predisposed agenda? Pot meet kettle.

Thanks for being one of our most loyal viewers. We distort, you comply.

"You mean the war was about stealing oil?"

Actually, it's a war about stopping the theft of oil. For years, Saddam and his nice family have profited from selling Iraqi oil illegally to his neighbors (smuggling, including that pipeline to Syria that was recently shut down). Selling oil at below-market prices. Selling oil to skirt international sanctions. Profits he could deposit into his Swiss bank accounts or to purchase more gold and marble for his palaces. NOT oil revenues that could be used to benefit the people of Iraq. Fortunately, this selfish and criminal behaviour has ceased.

The US imports 58% of its oil. The top 3 countries we import from are Saudi Arabia, Canada and Mexico. Iraq is #7 with representing only 3.9% of our total oil usage. Slightly turn up the faucets our own domestic oil and on the six countries above Iraq and you don't need Iraq's oil at all. So, what is this about it being all about oil?

... will be able to rooster tail the London Bridge all day.

I'm so proud of my country.

Now we don't have to deal with the some other middle man.

Now we got our own middle man.

God bless our perfect leader.

"Of the three feasible alternatives (that the contracts go to American capitalists, or to some unspecified non-American capitalists, or that Iraqi oil production stays as it was), the supposed radicals appear to prefer the last of the three." -- Christopher Hitchens

Why are you anti-{fill-in-the-blank} people so cruel? Are you unable to see that the choices are limited to the three listed above? Please make a case for choices #2 and #3 above if you feel that way.

We stole it fair and square. It should go to Amurcan Cumpnies.

moronic post 1: "Of the three feasible alternatives (that the contracts go to American capitalists, or to some unspecified non-American capitalists, or that Iraqi oil production stays as it was), the supposed radicals appear to prefer the last of the three." -- Christopher Hitchens Why are you anti-{fill-in-the-blank} people so cruel? Are you unable to see that the choices are limited to the three listed above? Please make a case for choices #2 and #3 above if you feel that way."

there are other alternatives--such as a massive public works project paid for by the us govt, the major force behind the destruction of such items in the first place. it needn;t be a case of handing money to any corporations if you use the apparatus of the iraqi state to rebuild everything--paid for by the us. this would go along with the just solution--the nationalization/socialization of oil infrastructure. wishful thinking, i know, given the fascists who now occupy the country. and there is no reason that, in the event of using corporations to rebuild, non-us firms do the job. i see no reason to reward the us and its corporations who caused the entire mess in the first place. ie the us deserves no praise for getting rid of a tyrant that the us originally built up. hell, the guys who put him in and supplied him, like daddy bush, should go to the hague.




moronic post 2: "The US imports 58% of its oil. The top 3 countries we import from are Saudi Arabia, Canada and Mexico. Iraq is #7 with representing only 3.9% of our total oil usage. Slightly turn up the faucets our own domestic oil and on the six countries above Iraq and you don't need Iraq's oil at all. So, what is this about it being all about oil?"




a straw man. hardly anyone argues for the priority og iraqi oil going to us consumers. rather, the more important items are a) us dollar hegemony, which is tied intimately to oil, b) breaking opec and the control over pricing that us firms will have then, and c) the second largest supply--100B barrels--that can be sold to "emergin markets" in asia--countries like india, pakistan, and china, which have low levels of industrialization, but high levels of growth and large populations. the profits to made by us oil firms are very very great. to ignore these motivations on the part of an executive branch soaked in oil is beyond, heh, ignorant.




moronic post 3: "Actually, it's a war about stopping the theft of oil. For years, Saddam and his nice family have profited from selling Iraqi oil illegally to his neighbors (smuggling, including that pipeline to Syria that was recently shut down). Selling oil at below-market prices. Selling oil to skirt international sanctions. Profits he could deposit into his Swiss bank accounts or to purchase more gold and marble for his palaces. NOT oil revenues that could be used to benefit the people of Iraq. Fortunately, this selfish and criminal behaviour has ceased."




oh really? the war waged to stop saddam's piracy? his contraband oil smuggling operation? that is fresh, and ludicrous. and anyway, since oil is subject to abritrage, any oil released into the market this way would lower prices overall by increasing supply. you can;t be serious about this, considering that lower prices in some ways the goal of the intervention. furthermore, this data strikes me as a worldnetdaily tale--very plausible, but not substantiated because no eivdence is presented or available. you also ignore the crucial fact that the sanctions regime holds all iraqi income in escrow and makes all purchases on behalf of iraq. your scenario implies that oil must be smuggled out, past the sanctions regime--and i'm sure they forgot to monitor the pipeline!--and then cash must be smuggled back in, and then presumably out to buy the gold and marble to which you so casually allude--and then these highly concealable itmes must be smuggled in. you obviously think that the sanctions regime is run by idiots--never mind the starving kids.




moronic post 4: "Where was all this concern for the Iraqi people when Saddam was butchering 1.5 million Iraqis? If yopu are so concerned about them, then you should be praising the fact that this militaryt action will save millions of lives going forward from the likes of Saddam and his sons, even if it is a byproduct of some purely economic conspiracy."

a) 1.5M iraqis is an incorrect figure. saddam *is* a butcher, but you can not attribute to saddam's "butchery" the fact that the sanctions regime, imposed by the UN, and the daily bombings in the cannonbone/no-fly zones by the US/UK were saddam's fault. that's the same as arguing that it's the wtc's fault that it caught a few airplanes and then collapsed. just pure jingoistic silliness.

b) and, you FUCKING DOLT, we were protesting saddam ever since the fascists in dc installed his ass. jesus fucking christ. no matter. all the pro-war fuckheads were cheering saddam when the us helped him murder the "evil iranians" in the 1980s, to be sure, or when saddam murdered thousands of leftists. the only ones who are consistent are people who have always opposed him.

These anti-war kids are so thick you have to walk them through it step by step. Thanks for doing that. Saved me some keystrokes. Excellent post.

"there are other alternatives--such as a massive public works project paid for by the us govt"

When the US govt funds infrastructure development, and contracts with US corporations to manage the job, it is a massive public works project. What are you talking about?

------------

"and there is no reason that, in the event of using corporations to rebuild, non-us firms do the job."

I think most US taxpayers would disagree with you. And don't forget that the world's best infrastructure engineering firms are almost exclusively American. Why should US taxpayer money go to a non-US company when a US company is as-good or better?

-----------

"us dollar hegemony, which is tied intimately to oil"

Please explain how this is so. What happens when an entity purchases oil with euros? Do they put the money in the bank in euros and let it sit there? No. The money is invested. If the managers decide to invest it in a euro-denominated asset, they will buy that asset with the euros. If they decide to purchase a dollar-denominated asset, they will convert to dollars and buy the asset. The currency in which the oil is purchased has nothing to do with the asset ultimately purchased by those funds. Your argument defies all laws of economics and finance.

---------------------

"not substantiated because no eivdence is presented or available. you also ignore the crucial fact that the sanctions regime holds all iraqi income in escrow and makes all purchases on behalf of iraq."

You haven't been paying attention. What do you think was up with that Iraq-Syria pipeline that was just shut off last week? What is up with the tankers going to Jordan and Turkey the past several years? That's right. Smuggled oil, outside the control of the UN oil-for-food program. It only takes the slightest amount of study for you to have known about this. This is why the international community had given up on the sanctions being effective -- they were too-filled with holes.

------------

"but you can not attribute to saddam's "butchery" the fact that the sanctions regime, imposed by the UN"

All Saddam had to do to end the sanctions was to honor the armistice he signed -- to give up his WMDs. He didn't honor his agreement. What was the international community supposed to do? Forget about it? What do you propose should have happened?

"there are other alternatives--such as a massive public works project paid for by the us govt"

When the US govt funds infrastructure development, and contracts with US corporations to manage the job, it is a massive public works project. What are you talking about?

------------

need the funds for a public works project necessarily go to us corporations? can it not be public engineers organized by the state on public salary? there is no need for it to be a for-profit kickback to bush campaign contributors, such as halliburton or bechtel.

"and there is no reason that, in the event of using corporations to rebuild, non-us firms do the job."

I think most US taxpayers would disagree with you. And don't forget that the world's best infrastructure engineering firms are almost exclusively American. Why should US taxpayer money go to a non-US company when a US company is as-good or better?

-----------

agreed. but the question of what us taxpayers want is a red herring in this case. which firms are the "best" seems to be a matter of taste-or of jingoism. how does one test this qualitative judgment?

"us dollar hegemony, which is tied intimately to oil"

Please explain how this is so. What happens when an entity purchases oil with euros? Do they put the money in the bank in euros and let it sit there? No. The money is invested. If the managers decide to invest it in a euro-denominated asset, they will buy that asset with the euros. If they decide to purchase a dollar-denominated asset, they will convert to dollars and buy the asset. The currency in which the oil is purchased has nothing to do with the asset ultimately purchased by those funds. Your argument defies all laws of economics and finance.

---------------------

is it not the case that opec sales have since the nixon shocks been denominated in us dollars? does this not further imply that nations that import oil from opec nations must therefore hold large us dollar currency reserves--in effect making the us dollar the default world reserve currency? does this not further indicate that, since the us dollar is a fiat currency, that the us produces dollars and exports them, along with its inflation, to oil importing nations who must purchase us dollars with goods and services? does this not further mean that "dollar hegemony" is a process of the us economy remaining strong despite its massive structural deficiencies--such as high debt, high trade deficit, and high budget deficit? and is it not further the case here that "dollar hegemony" in the final instance equates to the us getting tons of free stuff? ordinarily, your point re: the purchase currency would be salient, but in a circumstance where opec oil must by law be purchased with us dollars, it is a red herring. and you should know better than to posit the existence of mythical "laws of economics and finance."

"not substantiated because no eivdence is presented or available. you also ignore the crucial fact that the sanctions regime holds all iraqi income in escrow and makes all purchases on behalf of iraq."

You haven't been paying attention. What do you think was up with that Iraq-Syria pipeline that was just shut off last week? What is up with the tankers going to Jordan and Turkey the past several years? That's right. Smuggled oil, outside the control of the UN oil-for-food program. It only takes the slightest amount of study for you to have known about this. This is why the international community had given up on the sanctions being effective -- they were too-filled with holes.

------------

yes, i have paid attention to the *accusations* of smuggling, which are highly plausible. but i will withhold judgment in this regard until evidence is presented rigorously and sans conflicts of interest. so, the original thesis holds. and the international community has given up on the sanctions being effective? then why does the un now insist on the continuation of sanctions even though the us, suspiciously enough, wants them dropped? why does the international community, if the sanctions are believed to be ineffective, insist on the inspections regime still? come now, let's not ignore some of the more major developments in this narrative.

"but you can not attribute to saddam's "butchery" the fact that the sanctions regime, imposed by the UN"

All Saddam had to do to end the sanctions was to honor the armistice he signed -- to give up his WMDs. He didn't honor his agreement. What was the international community supposed to do? Forget about it? What do you propose should have happened?

i'm sorry--but where is the evidence of the existence of these wmd? are you just shilling the bush administration's official position? or have you some actual evidence that, contrary to von sponeck, halliday, ritter, elbaradei, blix, and the rest, proves that the hussein regime violated the un cease fire resolution by hoarding illicit weaponry? along with 6 billion other folks, i would love to see it.

There is nothing more I want to add. Readers, if they care, can read the points and counter-points and decide for themselves if anything is enlightening.

Isn't is great that we live in a country where we're free to choose and express ourselves....etc., without fear of recrimination. Cool stuff. And you're free to go somewhere else, if you don't like these freedoms.

I don't always agree with my country, but I ALWAYS

support my country. Live in a 3rd world country for a few years...there's no place like home!

Funtion test 5:40

Isn't the World Political structure a finely honed machine.

Pretty out of whack ...interesting times

Did you see all the hidden crates found of US money that was traded with Jordan for Iraq Oil over the years. like 640 mil & going up