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[casi-analysis] casi-news digest, Vol 1 #16 - 3 msgs

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Today's Topics:

   1. US Swallows Pride To Plead With UN (cafe-uni)
   2. UN Returns To Iraq On Secret Mercy Mission (cafe-uni)
   3. Naomi Klein: The $500 Billion Fire Sale (cafe-uni)


Message: 1
From: "cafe-uni" <>
To: "Casi News" <>
Subject:  US Swallows Pride To Plead With UN
Date: Sun, 18 Jan 2004 14:13:38 -0000

> US swallows pride to plead with UN
> Realpolitik: Trevor Royle On why the US has been forced to go cap in hand
> the UN for help in Iraq
> 18 January 2004
> This time last year the neo-cons in the Bush administration were
> about their Iraq policy. With or without weapons of mass destruction, the=
> were going to take the US to war against Iraq, topple Saddam Hussein and
> restore democracy and freedom . A new world order was in the offing. Pre-
> emptive strikes were good, diplomatic mind games were bad. Coalitions of
> willing were acceptable, world community nay-sayers were out of order.
> was the mood which took the Bush team to war . It worked. Iraq collapsed
> Saddam sought sanctuary in his hole in the ground. The problem was nobody
> really knew what to do next and within days of the official ceasefire
> coalition, soldiers were being killed and the country remained in chaos.
> What a difference a year makes. Tomorrow that policy will be reversed whe=
> the US proconsul in Iraq, Paul Bremer, meets UN secretary-general Kofi
> in an attempt to get the world body back onside.
> Acknowledging that the US needs the kind of expertise which only the UN
> bring to post-colonial handovers of power, Bremer will ask for help from
> organisation which colleagues such as deputy defence secretary Paul
> Wolfowitz once described as being immaterial. Annan will be minded to
> the olive branch, provided the US can give assurances about security and
> that will be no easy matter . A realist and a good moderator, Annan has
> always argued that his people have a role to play in Iraq and he will be
> keen to take steps which might pacify Ayatollah Sistani, the Shia leader
> is calling for elections before any handover of power.
> Annan will also want to end the year-long confrontation with Washington,
> which has disrupted diplomacy and created a split between those who
> supported the war and those who opposed it. Of course, nothing is for
> nothing and the pay-off will mean another change in US policy: in return
> helping them out in Iraq in 2004, France, Germany and Russia will be
> to bid for contracts to rebuild Iraq.
> The reversal should come as no big surprise. This is election year in the
> and Bush's team are anxious to get out of Iraq by the agreed timetable
> will see a new Iraqi assembly take over on July 1. Before then Iraqis wil=
> be encouraged to participate in regional caucuses for the assembly . At
> least that's the theory and that is why the UN is being asked to provide
> experience and expertise to ensure the transition is as smooth as
> Ahead of that moment the US has started a massive public relations
> to encourage Iraqis to support moves towards democracy.
> However, Shias are adamant they want elections before any hand over,
> that their demands are only democratic, and Ayatollah Sistani has
> civil disobedience if his supporters' wishes are not met. In the aftermat=
> of the military operations the south has been largely free of the kind of
> violence which has troubled the Sunni-dominated north but all that could
> change whatever is decided. If elections are not held the Shias could
> out their threat to hold violent demonstrations; if elections are held,
> Shias could sweep to power and confrontation would be inevitable.
> It will be a tough call for the UN to intervene decisively, but that is
> Bremer will be looking for in New York tomorrow. At the back of his mind
> will be the nightmare of 1975 when helicopters swooped onto the roof of
> US embassy in Saigon to rescue another team of well-meaning but suddenly
> irrelevant US proconsuls.
> =A92004 newsquest (sunday herald) limited.


Message: 2
From: "cafe-uni" <>
To: "Casi News" <>
Subject:  UN Returns To Iraq On Secret Mercy Mission
Date: Sun, 18 Jan 2004 14:12:55 -0000

> UN returns to Iraq on secret mercy mission
> (Filed: 18/01/2004)
> Telegraph
> A team of United Nations officials are covertly working to evacuate
> of children, war victims and others who are trapped in medical limbo,
> Colin Freeman in Basra
> With A cheerful grin he has no business wearing, Al'a Hashem wriggles
> his sofa, grabs the TV remote control in his mouth, and carefully switche=
> channel with his teeth. After losing both arms and legs in an
> it is all the 26-year-old law graduate can now do for himself.
> As with Ali Abbas, the 13-year-old Baghdadi boy who lost both arms from
> bombing during the war in Iraq, medical treatment overseas could give Mr
> Hashem new prosthetic limbs and, in time, a new life. But nine months
> the fall of Saddam Hussein's regime, he is among hundreds of Iraqi
> trapped in medical limbo within the country's dilapidated health system.
> In a secret mercy mission mounted by the United Nations, which claimed it
> had pulled all its officials out of Iraq after its headquarters in Baghda=
> were bombed last year, a team from its International Organisation for
> Migration agency has interviewed patients inside the country before
> searching the world for hospital beds for nearly 400 of the most needy.
> Thirteen-year-old Abbas Salah, for example, was born with four holes in
> heart and needs surgery to fulfil his modest dream of being able to ride =
> bicycle. Tabarak Maheb, six, who was born with a badly deformed nose,
> plastic surgery to silence the playground teasing that sends her home in
> tears every day.
> The IOM team, with Iraqi health officials, assessed nearly 600 patients
> needed treatment that was only available abroad. The agency now acts as a
> clearing house for the foreign charities, aid agencies and hospitals that
> can offer free treatment, as well as sorting out the necessary immigratio=
> regulations with the host countries.
> However, the process remains complex and last-minute cancellations are
> frequent. The international response has been muted because the UN is
> to maintain a low profile in Iraq and there is formidable bureaucracy
> involved in each case. Nearly two thirds of the 389 patients on the list
> still waiting to hear when - or indeed if - they will get treatment.
> Abbas has seen his hopes raised and dashed once already. "Two months ago
> got a call saying, 'Prepare your passports, you will be leaving in three
> days' time', and then the trip was cancelled," sobs his mother, Sana Abdu=
> al Razak. "His school told us to stop sending him there this year because
> they don't feel that they can look after him any more. All he wants is to
> able to ride a bicycle and play like other boys: now he can't even get an
> education."
> Likewise, Tabarak was on a list of children due to travel to Italy for
> cosmetic surgery last August. "You could never get the plastic surgery sh=
> needed under Saddam's time, so we were very happy," said her father,
> "But in the end it was cancelled - we never found out why. Now, every day
> she comes home crying from school, saying, 'Daddy, when can I go abroad t=
> get a new nose?' "
> Mark Petzoldt, the IOM's Kuwait-based logistics manager, conceded that it
> was a slow operation. "It is everything from finding a foreign doctor
> willing to do the treatment free, sorting out immigration for people who
> often have no passports, and then getting a charity to escort the people
> of Iraq, where the security situation is difficult. Unfortunately, a lot
> things can go wrong."
> Mr Hashem, from Basra, admits that he is no charitable cause celebre. His
> injuries stem not from coalition bombing or Saddam's torture chambers, bu=
> after he tried to erect a television aerial and snagged it on a nearby
> electric pylon. His flesh was flayed "like scrambled egg", according to
> doctor, Rafid Al Adhab.
> Yet his brother Walid, 39, who now looks after him, is still hopeful. "We
> ask every honest man and woman in the world to look at my brother's case,
> see his suffering. If we had any ability to help him, we would, but we
> cannot."
> Some families are becoming impatient. Mustapha Salaam, 10, suffers from a
> generalised bleeding condition that normally demands blood transfusions
> twice a week. During the war, he and his father, Salaam Khalaf, had to
> the six-mile journey to Basrah's main hospital on foot, braving bombs and
> bullets each time.
> "His life is a misery - he cannot play football or run about because if h=
> gets a bruise, he starts bleeding," says Mr Khalaf, 43. "Tony Blair was i=
> Basra just two weeks ago - if he comes here to visit, why doesn't he help
> people like my son?"
> Adrian Sutton, a British film maker who acts as the IOM's Middle East
> spokesman, stressed the achievements of the programme so far: 147 of the
> have already been evacuated, and a major programme to rebuild Iraq's
> infrastructure is also under way.
> He says more help would be welcome, especially from Britain, given its bi=
> military presence in southern Iraq. No British aid agencies are involved
> with the IOM.
> "Most have been from the Middle East and Germany, Austria, Italy and
> Greece," he says. "We think it is mainly because the charities there have
> just been particularly pro-active, rather than any problem at the British
> end. But we would greatly appreciate some more UK involvement, and from
> elsewhere too."
> =A9 Copyright of Telegraph Group Limited 2004.


Message: 3
From: "cafe-uni" <>
To: "Casi News" <>
Subject:  Naomi Klein: The $500 Billion Fire Sale
Date: Sun, 18 Jan 2004 20:56:00 -0000

> The $500 billion fire sale
> In a shattered postwar Iraq, there are rich pickings to be had - and for
> businesses at least, it promises to be a risk-free bonanza. Naomi Klein
> joins those at a trade show jostling for a stake
> Saturday January 17, 2004
> The Guardian
> It's 8.40am, and the Sheraton Hotel ballroom thunders with the sound of
> plastic explosives pounding against metal. No, this is not the Sheraton i=
> Baghdad, it's the one in Arlington, Virginia. And it's not a real
> attack, it's a hypothetical one. The screen at the front of the room is
> playing an advertisement for "bomb-resistant waste receptacles" - this
> can is so strong, we're told, it can contain a C4 blast. And its
> manufacturer is convinced that, given half a chance, these babies would
> like hot cakes in Baghdad - at bus stations, army barracks and, yes,
> hotels. Available in Hunter Green, Fortuneberry Purple and Windswept
> This is ReBuilding Iraq 2, a gathering of 400 businesspeople itching to
> a piece of the Iraqi reconstruction action. They're here to meet those
> doling out the cash, in particular the $18.6bn in contracts to be awarded
> the next two months to companies from "coalition partner" countries. The
> people to meet are from the Coalition Provisional Authority (CPA), its ne=
> programme management office, the Army Corps of Engineers, the US Agency
> International Development, Halliburton, Bechtel and members of Iraq's
> interim governing council. All these players are on the conference
> programme, and delegates have been promised that they'll get a chance to
> corner them at regular "networking breaks".
> There have been dozens of similar trade shows on the business
> created by Iraq's decimation, in hotels from London to Amman. By all
> accounts, the early conferences throbbed with the sort of cash-drunk
> euphoria not seen since the heady days before the dotcoms crashed. But it
> soon becomes apparent that something is not right at ReBuilding Iraq 2.
> Sure, the organisers do the requisite gushing about how "nonmilitary
> rebuilding costs could near $500bn" and that this is "the largest
> reconstruction effort since the US helped to rebuild Germany and Japan
> the second world war".
> But for the undercaffeinated crowd staring uneasily at exploding garbage
> cans, the mood is less gold rush than grim determination. Giddy talk of
> "greenfield" market opportunities has been supplanted by sober discussion
> sudden-death insurance; excitement about easy government money has given
> to controversy about foreign firms being shut out of the bidding process;
> exuberance about CPA chief Paul Bremer's ultraliberal investment laws has
> been tempered by fears that those laws could be overturned by a directly
> elected Iraqi government.
> At ReBuilding Iraq 2, held last December, it seems finally to have dawned
> the investment community that Iraq is not only an "exciting emerging
> market", it's also a country on the verge of civil war. As Iraqis protest
> about layoffs at state agencies and make increasingly vocal demands for
> general elections, it's becoming clear that the White House's prewar
> conviction that Iraqis would welcome the transformation of their country
> into a free-market dream state may have been just as off-target as its
> prediction that US soldiers would be greeted with flowers. I mention to
> delegate that fear seems to be dampening the capitalist spirit. "The best
> time to invest is when there is still blood on the ground," he assures me=
> "Will you be going to Iraq?" I ask.
> "Me? No, I couldn't do that to my family." He was still shaken, it seemed=
> by the afternoon's performance by ex-CIAer John MacGaffin, who had
> the crowd like a Hollywood drill sergeant. "Soft targets are us!" he
> bellowed. "We are right in the bull's-eye ... You must put security at th=
> centre of your operation!" Lucky for us, MacGaffin's own company, AKE
> offers complete counterterrorism solutions, from body armour to emergency
> evacuations.
> Youssef Sleiman, managing director of Iraq Initiatives for the Harris
> Corporation, has a similarly entrepreneurial angle on the violence. Yes,
> helicopters are falling, he says, but "for every helicopter that falls
> is going to be replenishment".
> I notice that many delegates are sporting a similar look: army-issue brus=
> cuts paired with dark business suits. The guru of this gang is retired
> General Robert Dees, freshly hired out of the military to head Microsoft'=
> "defence strategies" division. Dees tells the crowd that rebuilding Iraq
> special meaning for him because, well, he was one of the people who broke
> it. "My heart and soul is in this because I was one of the primary
> of the invasion," he says with pride. Microsoft is helping to develop
> "e-government" in Iraq, which Dees admits is a little ahead of the curve,
> since there is no g-government in Iraq, not to mention functioning phone
> lines.
> No matter. Microsoft is determined to get in on the ground floor. In fact=
> it is so tight with Iraq's governing council that one Microsoft executive=
> Haythum Auda, was the official translator for the council's minister of
> labour and social affairs, Sami Azara al-Ma'jun, at the conference. "Ther=
> is no hatred against the coalition forces at all," al-Ma'jun says, via
> "The destructive forces are very minor and these will end shortly ... Fee=
> confident in rebuilding Iraq!"
> The speakers on a panel about managing risks have a very different
> however: feel afraid about rebuilding Iraq, very afraid. Unlike previous
> presenters, their concern is not the obvious physical risks, but the
> potential economic ones. These are the insurance brokers, the grim reaper=
> of Iraq's gold rush.
> It turns out that there is a rather significant hitch in Bremer's bold
> to auction off Iraq while it is still under occupation: the insurance
> companies aren't going for it. Until recently, the question of who would
> insure multinationals in Iraq has not been pressing. The major
> reconstruction contractors such as Bechtel are covered by USAID for
> "unusually hazardous risks" encountered in the field. And Halliburton's
> pipeline work is covered under a law passed by Bush last May that
> indemnifies the entire oil industry from "any attachment, judgment,
> lien, execution, garnishment, or other judicial process".
> But with bidding now starting on Iraq's state-owned firms, and foreign
> ready to open branches in Baghdad, the insurance issue is suddenly urgent=
> Many of the speakers admit that the economic risks of going into Iraq
> without coverage are huge: privatised firms could be renationalised,
> ownership rules could be reinstated and contracts signed with the CPA
> be torn up. Normally, multi-nationals protect themselves against this sor=
> of thing by buying "political risk" insurance. Before he got the top job
> Iraq, this was Bremer's business - selling political risk, expropriation
> terrorism insurance at Marsh & McLennan Companies, the largest insurance
> brokerage firm in the world. Yet, in Iraq, he has overseen the creation o=
> business climate so volatile that private insurers, including his old
> colleagues at Marsh & McLennan, are simply unwilling to take the risk.
> Bremer's Iraq is, by all accounts, uninsurable.
> "The insurance industry has never been up against this kind of exposure
> before," R Taylor Hoskins, vice-president of Rutherford International
> insurance company, tells the delegates apologetically. Steven Sadler,
> managing director and chairman at Marsh Industry Practices, a division of
> Bremer's old firm, is even more downbeat: "Don't look to Iraq to find an
> insurance solution. Interest is very, very, very limited. There is very
> limited capacity and interest in the region."
> It's clear that Bremer knew Iraq wasn't ready to be insured: when he
> Order 39, opening up much of its economy to 100% foreign ownership, the
> insurance industry was specifically excluded. I ask Sadler, a Bremer clon=
> with slicked-back hair and bright red tie, whether he thinks it's strange
> that a former Marsh & McLennan executive could have so overlooked the nee=
> for investors to have insurance before they enter a war zone. "Well," he
> says, "he's got a lot on his plate." Or maybe he just has better
> information.
> Just when the mood at ReBuilding Iraq 2 couldn't sink any lower, up to th=
> podium strides Michael Lempres, vice-president of insurance at the
> Private Investment Corporation (Opic). With a cool confidence absent from
> the shellshocked proceedings so far, he announces that investors can
> Uncle Sam will protect them. A US government agency, Opic provides loans
> insurance to US companies investing abroad. And while Lempres agrees with
> earlier speakers that the risks in Iraq are "extraordinary and unusual",
> also says that "Opic is different. We do not exist primarily to generate
> profit." Instead, Opic exists to "support US foreign policy". And since
> turning Iraq into a free-trade zone is a top Bush policy goal, Opic will
> there to help out. Earlier that same day, Bush signed legislation
> "the agency with enhancements to its political risk-insurance programme",
> according to an Opic press release.
> Armed with this clear political mandate, Lempres announces that the agenc=
> is now "open for business" in Iraq, and is offering financing and
> including the riskiest insurance of all: political risk. "This is a
> for us," he says. "We want to do everything we can to encourage US
> investment in Iraq." The news, as yet unreported, appears to take even th=
> highest-level delegates by surprise. After his presentation, Lempres is
> approached by Julie Martin, a political risk specialist at Marsh &
> "Is it true?" she demands.
> Lempres nods. "Our lawyers are ready."
> "I'm stunned," says Martin. "You're ready? No matter who the government
> "We're ready," Lempres replies. "If there's an expro[priation] on January
> we're ready. I don't know what we're going to do if someone sinks $1bn
> a pipeline and there's an expro." Lempres doesn't seem too concerned abou=
> these possible "expros", but it's a serious question. According to its
> official mandate, Opic works "on a self-sustaining basis at no net cost t=
> taxpayers". But Lempres admits that the political risks in Iraq are
> "extraordinary". If a new government expropriates and re-regulates across
> the board, Opic might have to compensate dozens of US firms for billions
> dollars in lost investments and revenues, possibly tens of billions. What
> happens then?
> At the Microsoft-sponsored cocktail reception in the Galaxy Ballroom that
> evening, Dees urges us "to network on behalf of the people of Iraq". I
> follow orders and ask Lempres what happens if "the people of Iraq" decide
> seize back their economy from the US firms he has so generously insured.
> bails out Opic? "In theory," he says, "the US treasury stands behind us."
> That means the US taxpayer. Yes, them again: the same people who have
> already paid Halliburton, Bechtel et al to make a killing on Iraq's
> reconstruction would have to pay them again, this time in compensation fo=
> their losses. While the vast profits being made in Iraq are strictly
> private, it turns out that the entire risk is being shouldered by the
> public.
> For the non-US firms in the room, Opic's announcement is anything but
> reassuring: since only US companies are eligible for its insurance, and
> private insurers are sitting it out, how can they compete? The answer is
> that they likely cannot. Some countries may decide to match Opic's Iraq
> programme. But, in the short term, not only has the US government barred
> companies from non-"coalition partners" from competing for contracts
> US firms, it has made sure that the foreign firms that are allowed to
> compete will do so at a serious disadvantage.
> The reconstruction of Iraq has emerged as a vast protectionist racket, a
> neo-con New Deal that transfers limitless public funds - in contracts,
> and insurance - to private firms, and even gets rid of the foreign
> competition to boot, under the guise of "national security". Ironically,
> these firms are being handed this corporate welfare so they can take full
> advantage of CPA-imposed laws that systematically strip Iraqi industry of
> all its protections, from import tariffs to limits on foreign ownership.
> Michael Fleisher, head of private-sector development for the CPA, recentl=
> explained to a group of Iraqi businesspeople why these protections had to
> removed. "Protected businesses never, never become competitive," he said.
> Quick, somebody tell Opic and US deputy secretary of defence Paul
> The issue of US double standards comes up again at the conference when a
> representative takes the podium. A legal adviser to Bremer, Carole Basri
> a simple message: reconstruction is being sabotaged by Iraqi corruption.
> fear is that corruption will be the downfall," she says ominously, blamin=
> the problem on "a 35-year gap in knowledge" in Iraq that has made Iraqis
> "not aware of current accounting standards and ideas on anti-corruption".
> Foreign investors, she adds, must engage in "education, bring people up t=
> world-class standards". It's hard to imagine what world-class standards
> she's referring to, or who, exactly, will be doing this educating.
> Halliburton, with its accounting scandals back home and its outrageous
> overbilling for gasoline in Iraq? The CPA, with its two officers under
> investigation for bribe-taking and nonexistent fiscal oversight?
> On the final day of ReBuilding Iraq 2, the front- page headline in our
> complimentary copies of the Financial Times (a conference sponsor) is
> Linked To Perle Investment Fund. Perhaps Richard Perle, who supported
> Boeing's $18bn refuelling-tanker deal and extracted $20m from Boeing for
> investment fund, can teach Iraq's politicians to stop soliciting
> "commissions" in exchange for contracts.
> For the Iraqi expats in the audience, Basri's is a tough lecture to sit
> through. "To be honest," says Ed Kubba, a consultant and board member of
> American Iraqi Chamber of Commerce, "I don't know where the line is
> business and corruption." He points to US companies subcontracting huge
> taxpayer-funded reconstruction jobs for a fraction of what they are
> paid, then pocketing the difference. "If you take $10m from the US
> government and sub the job out to Iraqi businesses for a quarter-million,
> that business, or is that corruption?"
> These were the sorts of uncomfortable questions faced by George Sigalos,
> director of government relations for Halliburton KBR. In the hierarchy of
> Iraqi reconstruction, Halliburton is king, and Sigalos sits on stage,
> with jewelled ring and gold cufflinks, playing the part. But the serfs ar=
> getting restless, and the room quickly turns into a support group for
> would-be subcontractors: "Mr Sigalos, what are we going to have to do to
> some subcontracts?"
> "Mr Sigalos, when are you going to hire some Iraqis in management and
> leadership?"
> "I have a question for Mr Sigalos. I'd like to ask what you would suggest
> when the army says, 'Go to Halliburton', and there's no response from
> Halliburton?"
> Sigalos patiently tells them all to register their firms on Halliburton's
> website. When they respond that they have already done so and haven't
> back, he invites them to "approach me afterward".
> The scene afterwards is part celebrity autograph session, part riot.
> is swarmed by at least 50 men who elbow each other out of the way to
> the Halliburton VP with CD-roms, business plans and r=E9sum=E9s. When Sig=
> spots a badge from Volvo, he looks relieved. "Volvo! I know Volvo. Send m=
> something about what you can achieve in the region." But the small,
> players who have paid their $985 entrance fees, here to hawk portable
> generators and electrical control panelling, are once again told to
> "register with our procurement office". There are fortunes being made in
> Iraq, but it seems they are out of reach for all but the chosen few.
> The next session is starting and Sigalos has to run. The serfs wander off
> through the displays of shatterproof glass and bomb-resistant trash cans,
> caressing Sigalos's business card and looking worried
> @ Naomi Klein, 2004. A version of this article first appeared in the

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