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Fellow Listers, America's most powerful newspaper, the Washington Post, today published a lengthy Commentary urging that Oil-for-Food be scrapped. The writer - Susan Blaustein - ignores history, misreads international agreements, and confuses extremist conjecture with fact. That the Post would publish this piece points to a breakdown in editorial review. The commentary itself merits correction as to its 'facts', and condemnation for its conclusions and fundamental lack of humanity. Frankly, I need to cool off before I'm fit to write, but *please* contact: >> The Post opinion page at letters@washpost.com (Note: 'Letters must be exclusive to The Washington Post, and must include the writer's home address and home and business telephone numbers.') >> Concerning factual errors, contact the Post "ombudsman" at ombudsman@washpost.com or (202) 334-7582 >> Contact Ms. Blaustein's organization at coalition@cij.org or cij@cij.org If you're writing from the U.S., please cc: your Senators. Regards, Drew Hamre Golden Valley, MN USA === http://www.washingtonpost.com/ac2/wp-dyn/A38407-2002Aug2?language=printer Saddam Hussein's Billions By Susan Blaustein Sunday, August 4, 2002; Page B07 Despite his often-rehearsed plaint that international sanctions have starved and ravaged his people, Saddam Hussein is laughing all the way to the arms bazaar. Since 1997 Iraq has brought in an average of $6 billion a year in civilian goods through the U.N. oil-for-food program, the country's only legitimate source of outside income. Under this program, Iraqi oil is exported in exchange for imports deemed by international experts to have no military utility. On top of this, Hussein and his sons and henchmen have managed to earn at least another $2 billion a year in hard currency by illegally manipulating the U.N. system and running extensive smuggling operations outside it. Ninety percent of that estimated $2 billion comes from oil smuggling. Hussein & Sons have developed many channels outside the oil-for-food program through which the regime has managed to export oil in exchange for hard currency and goods not subject to U.N. oversight. These channels involve Turkey, Jordan, Syria, Lebanon, Iran and the Gulf states, and they are widening over time. The extra cash makes it possible for Hussein to continue to purchase the loyalty and protection of his myriad security and intelligence forces; to improve his ratings in the Arab world by erecting gargantuan mosques and paying off the families of Palestinian suicide bombers; and, most dangerously, to feed his clandestine weapons procurement and development program. The international community has long been aware of Hussein's illicit revenue stream and weapons programs but has nevertheless turned a blind eye. In May the U.N. Security Council finally approved revisions in the oil-for-food program to focus it more narrowly on limiting Hussein's capacity to import weapons of mass destruction while sparing the Iraqi people as much as possible from the sanctions' effects. The revised U.N. program, which has only just begun to be implemented, will, it is hoped, expedite the influx of civilian goods to Iraq and thereby put the lie to Hussein's claim that sanctions rather than his criminal regime are to blame for Iraqis' protracted misery. But these so-called smarter sanctions cannot impede Saddam Hussein's ability to finance his procurement and development of weapons of mass destruction. The fatal flaw in the U.N. program is that it does not -- nor is it intended to -- stanch the money flow to Baghdad generated by the illicit trade that falls outside oil-for-food. In fact, Hussein's hard-currency earnings will likely increase as a result of the changes. For one thing, the revised program has actually increased the variety of goods on which Hussein can exact kickbacks from his trading partners and that he can then re-export for foreign exchange. Moreover, the revised program leaves virtually untouched Hussein's vibrant, illicit oil-for-goods barter with neighboring states -- all of which takes place under the passive watch of the international community. Reasons abound for what amounts to a universal decision to look the other way. Russia and France, two U.N. Security Council members that also happen to rank among Hussein's best business partners, have been openly threatened by Hussein with the loss of lucrative oil-for-food contracts unless they continue to sing Baghdad's tune on the Security Council and press for the lifting of sanctions. Jordan has been accorded an informal dispensation to continue its extensive trade with Iraq because of its extreme dependence on the Iraqi oil supply. The United States and United Kingdom, by far the most hard-nosed about enforcing the sanctions regime, nevertheless have been sensitive to the difficulties facing their close regional ally Turkey, which claims to have suffered severe economic damage from a decade of sanctions. The United States, keenly aware that Syria's cooperation is critical to prosecuting the war on terrorism, has been reluctant to demand that President Bashar Assad make good on his 15-month-old promise to crack down on his country's illicit trade with Baghdad. Analysts believe that in exchange for an attractive discount on its Iraqi oil purchases, Syria facilitates the procurement and transport of military hardware, which is of course proscribed under oil-for-food. Now that Syria sits on the U.N. Security Council and, therefore, on the U.N. Sanctions Committee, any U.N. directive to chill this new bilateral romance is highly unlikely. Iraq has also earned more than $200 million a year from oil smuggled through Iranian coastal waters that is then either re-exported from Iran or finds its way to the United Arab Emirates and beyond. In 1991 the United Nation established a multinational interception force expressly to interdict Iraqi oil exports in the Gulf. But the largely American force is not permitted in Iranian territorial waters and thus must sit impotent as barges sloshing with Iraqi oil hug the Iranian coast. The force estimates that, largely as a result of this handicap, it interdicts only 5 percent of those barges bearing smuggled Iraqi oil. The Iranian Revolutionary Guard naval patrol has been the chief facilitator and beneficiary of this coastal traffic, which appears to benefit Iran's hard-liners. But in recent weeks the Iranian navy, which operates under the command of Tehran's moderate president, Mohammad Khatami, has begun, as it has on other occasions, to crack down on this illegal waterway traffic. This latest crackdown began at just about the time Tehran announced that it would not forcibly oppose a U.S. military strike on Iraq. More hard currency is obtained by Hussein's Mukhabarat, one of the dreaded intelligence services run by Hussein's son Qusai, which has reportedly set up front companies that re-export oil-for-food goods, such as medicines, baby food, vehicles, spare parts and electronics, in exchange for as much as $20 million a year, with which it is believed to buy weapons. A bevy of international trade fairs has served to enhance Baghdad's respectability and bring in up to $30 million annually in rents and fees; and each year religious pilgrims visiting Iraq's holy sites are being fleeced for as much as $40 million. Iraq has recently begun taking in an unknown amount in overflight and landing fees now that -- in a brazen multilateral demonstration of the sanctions' effective impotence -- Jordan, Syria, Russia and France have all resumed flying into Hussein International Airport. Although the United States has long been the most adamant Security Council member about prohibiting the flow to Iraq of imports that might be used in weapons production, and although President Bush singled out Hussein as a major target in the war against terrorism and the states that sponsor it, U.S. imports of Iraqi oil have, since Sept. 11, increased significantly, even dramatically at times. In January, when Bush designated Iraq a constituent member of his axis of evil, the United States consumed 75 percent of all Iraqi oil exported under oil-for-food, according to U.S. government figures. No U.S.-based oil firms are currently direct purchasers of Iraqi oil, but the illegal 20-cent to 70-cent-per-barrel surcharges that Hussein has managed to embed in the pricing system worked out with the U.N. Sanctions Committee are passed up the line -- from the buyers who must actually agree to the kickbacks (mostly Russian, Chinese, Thai, Indian and Vietnamese firms and small shell companies registered in Western countries that tolerate money-laundering) to the major traders to the American refineries and, presumably, to the ordinary motorist. This suggests that American companies and consumers are the last links in a chain of enablers who have helped to underwrite Hussein's end run around the U.N. system. Before Sept. 11, four free trade agreements with Iraq had been signed, by Egypt, Syria, Tunisia and Yemen. Since then another eight have been signed -- by Algeria, the United Arab Emirates, Sudan, Bahrain, Oman, Lebanon, Qatar and Jordan. Two more are under discussion, one with Bahrain and one with Saudi Arabia, which recently reopened a border post closed since the Gulf War to facilitate direct trade and which has scheduled a big trade fair in Baghdad for the fall. In announcing each new bilateral agreement, trade officials have heralded vastly expanded trade relations between the two countries involved. Hussein's co-signatories are well aware that each agreement affords him both the immediate political benefit of hammering yet another nail in the coffin of sanctions and the long-term economic benefit of preferential trade access once they are lifted. A clearer picture of Hussein's funding mechanisms unravels a number of apparent contradictions that have long puzzled many observers. First, there remain shortages of basic medicines and foodstuffs in Iraq, despite its being the beneficiary of the world's largest humanitarian program ever. That is because Hussein controls the distribution of goods. Second, as long as Security Council members have vested business interests in Iraq, they will not make any serious effort to see that their own sanctions are enforced. Third, although Iraq's neighbors -- and Iraq's own beleaguered Kurdish population -- certainly hold no brief for Saddam Hussein, they continue to resist the Bush administration's call for "regime change" in Baghdad at least in part because they are benefiting from the status quo. Finally, the obvious: The Iraqi government has continually drawn out and obstructed talks with the United Nations regarding the resumption of weapons inspections because it probably does, in fact, have a great deal to hide. The U.N. oil-for-food program costs $6 billion a year. That's six times the size of the international community's other major humanitarian operations, such as in Bosnia, Rwanda and post-conflict Afghanistan. But the Iraq program is not effective. Nor can it ever be, given its structure, the deference that the U.N. accords Hussein, the makeup of the Security Council and the lack of political will to make it work. Barring robust enforcement, the program is simply a charade and should be scrapped. Doing so would surely rob Hussein of his triumph to date in the realm of public diplomacy. But it would also force the international community to face up to the fact that the U.N. program it devised has failed to stop Hussein from getting most of what he needs to remain a grave regional and worldwide threat. ... The writer is senior consultant to the Coalition for International Justice and co-author, with John Fawcett, of a forthcoming study of Saddam Hussein's sources of revenue. _______________________________________________ Sent via the discussion list of the Campaign Against Sanctions on Iraq. 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