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[casi] News, 27/8-3/9/03 (3)

News, 27/8-3/9/03 (3)



*  U.S. to Boost Bechtel's Funding To Rebuild Iraqi Electricity Grid
*  U.S. Seeking Foreign Investment for Iraq
*  Iraqi assets seized by U.S. nearly depleted
*  US decree strips thousands of their jobs
*  The Battle for a Cell-Phone Deal


*  Unprepared for Peace in Iraq
*  Bremer: Stakes 'Extremely High' in Iraq
*  Perle Cites Errors in Iraq, Urges Power Transfer
*  U.S. State Department lists troop commitment to Iraq
*  White House Likens Iraq to Postwar Germany to Retain Support
*  Condi's Phony History Sorry, Dr. Rice, postwar Germany was nothing like
*  US attacked over green card soldiers
*  Pentagon May Have to Reduce U.S. Forces in Iraq -CBO


(c) INFRASTRUCTURE,,SB106202200569137600,00.html

by Neil King Jr. in Washington and Simeon Kerr in Dubai, United Arab
Wall Street Journal, 27th August

Faced with escalating costs and continued instability in Iraq, U.S.
officials in Baghdad have decided to boost Bechtel Group Inc.'s postwar
reconstruction contract by $350 million, or more than 50%.

The decision to steer additional funds to Bechtel is the latest sign that
the Bush administration has seriously underestimated the cost and complexity
of rebuilding Iraq. Although the U.S. plans a dramatic push for new
reconstruction funds -- part of what one U.S. official said will be a $2.75
billion emergency budget request for Iraq next month -- the administration
remains vague on what the overall project is likely to cost.

The new Bechtel money, which could be turned over within days, is part of at
least $1 billion the U.S. hopes to pour into Iraqi power generation alone
over the next year. U.S. officials and Bechtel assessment teams now estimate
Iraqi reconstruction will cost at least $16 billion and likely much more. L.
Paul Bremer, the top U.S. official in Iraq, has said that the costs of
rebuilding Iraq and revitalizing its economy could top $100 billion.

San Francisco-based Bechtel was originally awarded an 18 month, $680 million
contract for Iraqi reconstruction work on airports, water, power, schools,
roads and government buildings. After business rivals and some legislators
criticized the limited competition involved in that award, Andrew Natsios,
the head of the U.S. Agency for International Development, promised that no
additional taxpayer money would go into the Bechtel contract beyond the $680
million ceiling.

According to a funding document from the U.S.-led Iraqi provisional
authority, however, U.S. officials recently decided that Bechtel requires
the additional $350 million "to maintain momentum in high-priority
infrastructure projects." Mr. Bremer approved the new projects on Aug. 20,
according to the document.

Wednesday, an AID spokeswoman said that "security conditions" had evidently
led Mr. Bremer to lift the limit and give more work to Bechtel. The
additional $350 million will come from what's left of a $2.5 billion Iraq
reconstruction fund Congress approved early this year.

U.S. officials also said they are willing to consider sharing responsibility
for security with a United Nations-backed multinational force as long as it
was under American command (See
tset box>  related story1).

Possibly within weeks, the Bush administration plans to put out for bids a
new contract for follow-on work in Iraq that could be valued at well over $2
billion, according to administration and congressional sources. The contract
would focus mainly on power and water work. Congress has pressured the
administration to open any additional Iraq work to competition and not
simply to stick with the same contractors.

Michael Kidder, a Bechtel spokesman, said there have been "informal
discussions" in Baghdad on the need for new funding but added that "we have
not received any formal notification of additional work in Iraq."

As with other contractors in Iraq, Bechtel's work has been delayed and made
more expensive by rampant sabotage. In the spring, Bechtel teams found that
dozens of power towers were down across Iraq, some the result of past wars
and others the work of looters and saboteurs. An assessment in recent weeks,
however, found that over 120 power towers are now down across the country.
"It's a big problem," said one Bechtel official.

Partly because of such sabotage, U.S. officials in Iraq have been forced to
revise several times their forecast for restoring electricity to prewar
levels. Earlier this summer, Mr. Bremer promised to do so by the end of
July. The provisional authority now says Iraqi power generation won't reach
4,400 megawatts until the end of September -- and that's still short of
Iraq's prewar generation of about 5,000 megawatts.

In a desperate attempt to improve the power situation, the provisional
authority is negotiating deals to import power from Turkey and possibly even
longstanding U.S. antagonists Syria and Iran. The authority is currently
finalizing a two-year contract with privately owned Turkish power company
Karadeniz for the provision of 50 megawatts of electricity, which will
eventually rise to 75 megawatts, a senior authority official said.

Iraqi Electricity Commission officials have also opened talks with Syria and
Jordan, and plan to start negotiating soon with Iran, the official said.
Iraqi authorities might barter crude oil for the cash value of any power
contracts signed, though it isn't certain that suppliers will agree to such

"We're keen to explore options of importing power to help solve the current
imbalance in electricity supply-demand," said Charles Heatley, a spokesman
for the coalition authority in Baghdad.

Iranian officials said they would have no problem with selling electricity
to Iraq. "Although we don't recognize the Iraqi government, that doesn't
mean there wouldn't be talks between the two countries," said Hossein
Afarideh, chairman of the Iranian Parliament's energy commission. Iran is
already discussing the possibility of supplying liquefied natural gas and
gasoline to Iraq, said Hojat Ghanimi Fard, executive director with the
National Iranian Oil Co.

In Washington, the scramble for new reconstruction money comes as available
funds are drying up quickly. Since late spring, the U.S.-led administration
in Baghdad has spent most of $2.1 billion in seized Iraqi assets, much of
which went to pay Iraqi government salaries and to fund smaller
reconstruction projects handled by the U.S. military.

To replenish the coffers there, the Treasury Department plans within a week
to send a last installment of $420 million in Iraqi assets that were
previously frozen in U.S. banks. The U.S. is also working to get access to
more than $2 billion in Iraqi assets found in other countries.

The administration is sure to face criticism in Congress and elsewhere as it
moves to expand Bechtel's workload in Iraq. Republican Rep. Jim Kolbe of
Arizona, who heads the appropriations subcommittee that overseas foreign
aid, said he agreed with the need to lift the contract ceiling in this case.
"But we've made it abundantly clear to the administration that any new money
must be competitively bid," he said.

Congress is meanwhile bracing for what's expected to be a multibillion
dollar request to fill a gaping hole in Iraq's 2004 budget. Iraq's
sputtering oil revenues, estimated to be less than $10 billion next year,
might cover only half of the country's overall needs, some U.S. officials
estimate. The administration hopes that other countries will step up with
significant offers at an October donors conference in Spain.

Mr. Bremer told the Washington Post Tuesday that meeting Iraq's
infrastructure and other needs next year would require "several tens of
billions" of dollars from abroad.

But others are skeptical that the U.S. will receive substantial help. "I
think the administration is dreaming on that one," said Mr. Kolbe. The U.S.
is now spending about $4 billion a month just to keep 140,000 U.S. troops in

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by Richard A. Oppel Jr.
New York Times, 28th August

BAGHDAD, Iraq, Aug. 27 ‹ American officials here are preparing an order that
for the first time in decades would pry open most Iraqi industries for
foreign investment, opening a new lifeline for an economy starved of capital
during Saddam Hussein's government.

The proposal, outlined in a memo by the top American civilian administrator
here, L. Paul Bremer III, and circulated among the Iraqi Governing Council,
is a step toward creating a relatively open economy in a region long
protective of its domestic markets.

Aware of those sensitivities, the proposal excludes railroads, oil and
natural resources, electricity, and water and sewage ‹ areas that are either
linked to national security or that might inflame national resentment if
opened to foreigners. The proposal would also permit foreign investors to
take their profits out of the country, with no requirement to reinvest the
money here.

A number of Iraqi political leaders, while supporting the proposal in
concept, have raised concerns that it would create an uneven playing field
for Iraqi business owners. They fear that it would allow foreign businesses
with access to capital and credit to set up shop in Iraq while doing nothing
to help Iraqi entrepreneurs obtain the financing that could allow them to
compete against new entrants.

In particular, some members of the Governing Council say they expect Arab
retailers from nearby Persian Gulf states to take advantage of the new rules
early on, arriving with the money to finance nicer stores and bigger
inventories than Iraqi shop owners, who have little or no access to credit.
Other major industries in Iraq not exempted from the new proposal include
food and agriculture, manufacturing ‹ including state-run enterprises ‹ and
service businesses.

The proposal also cuts strongly against the grain of the socialist economic
dogma that dominated Iraq for decades.

"Many on the Council have not overcome their fears about the need for
protection," said Ahmad Chalabi, the Council member who is coordinating a
committee studying the proposal. "The culture of the Iraqis has been a
culture of fear that foreigners would take advantage of the country."

But American officials say the step is an important one to rebuild Iraq and,
in effect, democratize the economy.

In the memo outlining the proposal, Mr. Bremer said that foreign investment
would create more jobs ‹ with larger paychecks ‹ and introduce valuable
technologies to the country. He also said he believed it would reduce the
economic influence of wealthy businessmen allied with the Baath Party who
profited from their ties to the Hussein government. Currently, those people
control disproportionately large pools of capital, he said.

Mr. Bremer wrote in the memo that the "future prosperity" of Iraq would
depend in part on how successfully it could attract foreign investors.

While the new rules may shape the Iraqi economy in the years to come, for
now, practical decisions about investment are likely to be driven by the
country's unstable security situation. In addition to attacks on American
troops here, the rise of terrorism in Baghdad in the past month ‹ including
a bomb that killed 17 people at the Jordanian Embassy and a truck bomb that
killed 23 at the United Nations compound ‹ has also unsettled Westerners

Would-be foreign investors occasionally get a personal glimpse of the
country's security problems when they arrive: armed robberies are common on
the main road from Amman, Jordan, to Baghdad, as bandits armed with
Kalashnikov rifles routinely hold up convoys of arriving and departing

When Mr. Hussein was in power, investment by non-Arab foreigners was
effectively barred both by the Iraqi government and by the international
sanctions that followed the Persian Gulf war of 1991.

Arab investors were allowed only a minority stake in a business, people who
have studied the laws said. The United Nations Conference on Trade and
Development said $2.8 million in foreign direct investment flowed out of
Iraq from 1997 to 2001.

All of Iraq's neighbors enjoyed positive investment flows during the same
period, the conference said, including Turkey, which saw foreign direct
investment of $6.78 billion, and Saudi Arabia, with $4.69 billion. But those
numbers pale when compared with some much smaller Western countries. In
Ireland, for example, foreign investment of more than $60 billion flowed
into the country during the same five-year period.

Even though Mr. Bremer's proposal would end years of state ownership and
closed markets, it still called for significant restrictions. In addition to
barring investment in a handful of critical industries, the occupation
authority and a panel of Iraqi leaders would have 60 days to reject any
foreign investment of $40 million or more if they believed it threatened
national security or if the investor had a "history of unlawful behavior."

An investment of that size also could be rejected for other reasons,
including a determination that the foreign company or investor had not
demonstrated "how the project will affect national goals such as employment
creation, the development of national infrastructure, and technology
transfer, as well as the impact on the environment."

Mr. Chalabi said some on the Council wanted other changes, including a
mechanism for Iraqi businesses to obtain financing, which for most of them
was nonexistent, so they could compete against well-financed businesses from
abroad. Mr. Chalabi said the top American economic adviser in Iraq, Peter
McPherson, met with a committee of Governing Council members on Monday and
was "very amenable" to putting together a program to extend loans to Iraqi
business owners.

Council members are pushing for other modifications, including restrictions
on foreign investments that do not lead to the creation of jobs, such as the
speculative buying and holding of land in the hope of profiting from a rise
in values.

An official with the Coalition Provisional Authority, the civil
administration led by the United States, said that the concerns about
extending credit to Iraqi businessmen, and the rules for distinguishing
between speculative and job-creating investments had been discussed among
occupation officials and Council members. The concerns of the Iraqi Council
members "were well taken and well understood," the official said.

Some on the Council also want more certainty that people who profited under
the old government would not do the same under the proposed rules.

"We welcome foreign investment, that is for sure," said Adil Abdul Mahdi,
senior adviser to Abdul Aziz al-Hakim, an influential Shiite member of the
Council. "But we have to be sure there is no return of Baathist money," he
said. "Many offshore companies have been created by ex-regime people," he
said. He said he feared they could take advantage of open investment laws.

Mr. Mahdi also said the proposal should not leave poorly financed Iraqi
business owners competing against well-financed foreigners. "We have to be
sure we are really defending the interests of the Iraqi people," he said.

RFE/RL IRAQ REPORT, Vol. 6, No. 36, 29 August 2003

U.S. administrators in Iraq have nearly depleted the confiscated Iraqi
assets they used to pay Iraqi civil servants and will need more cash
quickly, Reuters reported on 26 August. U.S. Treasury Department Spokesman
Tony Fratto has said that a cash shipment of $419 million will be made in
the next week from a New York Federal Reserve account that once held $1.7
billion, adding that the shipment will "nearly exhaust the available vested
funds." According to Reuters, the White House may seek some $2-3 billion in
extra funding for Iraq to meet short-term needs before the 24 October
international donors conference in Madrid. The White House had not been
expected to seek additional funding for Iraq until at least November. A
senior congressional aide told the news agency that the situation is "a
mess," adding, "Seized assets are down to almost nothing. Oil money is a
mirage in the near term." But U.S. Representative James Kolbe, chair of the
House of Representatives Foreign Aid Subcommittee, told Reuters, "Yes, the
seized assets are nearly exhausted, but there are some other sources of
funds to pay salaries to Iraqis." (Kathleen Ridolfo),3604,1032048,00.html

by Jonathan Steele
The Guardian, 30th August

Tarik al-Kubaisy, vice-president of the Iraqi Society of Psychiatrists, is a
worried man. It's not just that the queue of patients suffering from severe
stress disorders in Iraq's war-torn society is growing longer by the day.

Nor that a country of 25 million has fewer than 100 psychiatrists and many
are planning to emigrate now that Saddam Hussein's restrictions on foreign
travel have gone.

The other concern for Dr Kubaisy, who was awarded a London University PhD
after four years at the Maudsley hospital, is that the Americans have taken
away his job.

Like many young Iraqi professionals, he joined the Ba'ath party several
years before Saddam became its leader and turned Iraq into a one-party
state. But under Order Number One, issued by Paul Bremer, Iraq's US
administrator - the so-called "de-Ba'athification" decree - Dr Kubaisy's
position as a professor in Baghdad University's college of medicine has

When Baghdad University and Iraq's other colleges re-open next week, around
2,000 senior staff have been told to stay at home, Dr Kubaisy estimates.
Although they were Ba'ath party members, none was connected to the former
regime's security apparatus.

"It's collective punishment. It's conviction without any charge," Dr Kubaisy
said yesterday. "I'm becoming a bit paranoid but I think the Americans
intend to force Iraqi brains to go abroad".

Coalition officials argue that every Ba'athist has not been purged. Only
those who held one of its top four ranks are barred from public service.

"The de-Ba'athification decree is the most popular thing we have done here,"
a senior coalition official said.

It was strongly promoted by Washington neo-conservatives like Paul
Wolfowitz, the deputy secretary of defence, and his friend, Ahmed Chalabi, a
businessman convicted in Jordan of fraud who is now a member of Iraq's
governing council.

"The problem is they didn't look at who were really leaders. They made the
issue of rank too important and went down too low," said Husam al-Rawi, a
member of the Royal Institute of British Architects and a professor in
Baghdad University's architecture department. "Instead of targeting a
thousand or a few hundred people, they targeted 80,000."

Prof Rawi joined the Ba'ath party as a 15-year-old in 1958 and was a section
head, the third rank down. Dr Kubaisy was even lower, a secretary of a

He was never asked to spy on other faculty members, he insisted. "We weren't
involved in policing. We had no association with the security organisation.
They had their own informers, who didn't have to be party members," he said.

"If you wanted to go abroad to attend a conference, you had to apply to the
dean of the faculty and then the university and then the ministry of the
interior. It didn't depend on us. I was often refused permission myself."

Prof Rawi joined the Ba'ath party when it stood for socialism and opposition
to religious extremists. "After Saddam Hussein took power, the party became
a skeleton with no spirit." By then it was too late to get out.

The de-Ba'athification decree is also causing turmoil in government
ministries, hospitals and other bodies considered part of the civil service.
Anyone in the top three levels of management loses their job if he or she
was a party member, regardless of rank.

"History teaches us that victors have to be magnanimous, but what are we
seeing here? A new society created on the basis of hatred and revenge," said
a senior official who declined to be named.

"When I joined the party in the 1970s, it was the party of oil
nationalisation, eradicating illiteracy, autonomy for the Kurds, and
national reconciliation ... Then Saddam destroyed the party. He executed
more Ba'athists than anyone else ... Most of us felt relieved when he was

"When this war began to loom, we were in an intellectual dilemma. Mounting
an insurrection against the regime meant helping the powers which wanted to
invade us. But if we supported the dictatorship, it was against our basic

Anger was the prevailing mood among large sections of the Baghdad middle
class, he said. People felt criminalised.

The de-Ba'athification decree provides for appeals and exemptions, if a
person has the support of staff, for example, and their jobs are judged
indispensable. A petition for Prof Rawi, signed by 350 students and 30
staff, was sent to the US administration two months ago, so far to no avail.

With the weeks ticking by and universities about to re-open, most sacked
academics have lost hope. The decree says nothing about protecting pensions
and they may not be paid. At least half the 2,000 university staff who have
been dismissed are likely to lose their government housing too.

Prof Rawi said this violated the fourth Geneva convention. "An occupier
cannot dismiss people from jobs, administer collective punishment, and
discriminate against people on the basis of political belief".

A coalition spokesman said that only between 15,000 and 30,000 people had
been affected: "The suggestion that there are lots and lots of innocent
people who have been unfairly dismissed is not true. Less than 5% of the
Ba'ath party members are covered".

by Andy Reinhardt in Paris
Business Week, 2nd September

The 400 international telecom execs, equipment vendors, and financiers who
crowded into the Grand Hyatt in Amman, Jordan, on July 31 for a briefing on
plans to build a new mobile- phone network in Iraq had dollar signs in their
eyes. At stake was nothing less than control of one of Iraq's most vital
future assets. Since Washington had already awarded billions in uncontested
reconstruction contracts to U.S. companies Halliburton Co. and Bechtel Group
Inc., the conference attendees had reason to worry that telecom might be the
next Americans-only honey pot.

Their concerns were heightened once they saw the terms: No bidder could be
more than 5% government-owned. That meant that nearly every mobile operator
in the Middle East and Europe was out of contention. Plus, the three winners
would be required to post bonds covering the full cost of construction --
possibly as high as $150 million each. Such demanding terms, says
telecom-equipment analyst Jason Chapman for researcher Gartner Inc., "would
have made the short list very short."

But a surprising thing happened over the next few weeks. Responding to the
outcry from potential bidders, the U.S.-led Coalition Provisional Authority
(CPA) twice relaxed its terms. By the time bids were due on Aug. 21, the CPA
had lowered the bond requirement to $30 million and agreed to permit up to
10% government ownership in any bidding consortium. That let state-owned
carriers enter the running in conjunction with private investors. More than
a half-dozen Middle Eastern telcos have thrown their hats in the ring.

The winners will be announced on Sept. 5. The CPA's tender for Iraq's mobile
network is a crucial test of its willingness to engage Iraq and the rest of
the Mideast in the job of rebuilding the ravaged nation. To date, says Walid
Khadduri, editor of the Cyprus-based Middle East Economic Survey, "there has
been very little reliance on Iraqi institutions." If the CPA were to award
mobile contracts only to U.S. companies, it would shatter any illusion that
America intends to spread the wealth.

Such concerns weren't foremost when the mobile contracts were being drawn
up. Seeking a lightning-fast rollout, the CPA devised a scheme to carve Iraq
into three wireless regions. Each will be served by different carriers.
After 12 months, the operators are encouraged to invade other territories in
the hopes of fostering competition.

The decision to limit the contracts to two years was perhaps the boldest
stroke. After that, a new Iraqi government is expected to organize its own
tender -- and there's no guarantee September's winners will be picked again.
It's an assurance to Iraqis "that we're not giving it away forever," says a
U.S. Senate Foreign Relations Committee staffer. Thus, most bidders have
lined up Iraqi partners. "Having local investors in a winning consortium is
seen as an insurance policy when a subsequent Iraqi government takes over,"
says Norman Sandler, director of global strategic issues for Motorola Inc.
(MOT ).

On the other hand, the two-year term could make it nearly impossible for
companies to recoup their investments. Iraq's infrastructure is so shattered
that operators may need to build pricey fiber or microwave backbones to
connect cellular towers. The threat of sabotage by rebels necessitates
expensive security. And market potential is limited by widespread poverty.
Motorola figures on only about 500,000 mobile users initially -- roughly a
$60 million annual business if customers spend an average of $10 per month.
Such small returns suggest that only the very brave -- or foolhardy -- are
plunging into the fray.

If Iraq gets back on its feet, though, the mobile pioneers could end up
profiting handsomely. Telecom analyst Bernt Ostergaard of Forrester Research
Inc. estimates that mobile penetration in Iraq could rise to 20%, or about
4.6 million users, in three years. That could translate into a $1 billion
annual market. With numbers like that, it's no wonder companies are seeing
green. The hope is that some of it stays in Iraq.


by Robert C. Byrd
Washington Post, 26th August

As the situation in Iraq continues to spiral out of control, an anxious
nation watches. Despite assurances to the American people that our troops
would be welcomed with open arms as liberators, U.S. soldiers are
increasingly being met with guns and car bombs. The bombing at the U.N.
headquarters in Baghdad has clearly exposed our vacant policy in Iraq. The
American people are told to be patient, that winning the peace will take
time. Meanwhile, the frustration of the Iraqi people grows by the day, as
does their anger. The inability of the United States even to restore basic
amenities further fuels the fire.

Before the war began, I urged the president to think through the
consequences. There was no doubt as to the military outcome of war between
the United States and Iraq; our might was unquestioned. But I was very
concerned about the repercussions that would follow, especially if we were
unable to persuade key allies to join our effort.

Today I urge President Bush to review his options. It is time to ask the
world community not only for assistance in restoring peace and security in
Iraq but also for participation in moving Iraq toward self-government. While
the secretary of state has opened a dialogue with the United Nations, it
must be a true exchange and not a U.S. monologue.

What has become tragically clear is that the United States has no strong
plan for turning Iraq over to the Iraqi people and is quickly losing even
its ability to maintain order. The administration is stumbling through the
dark, hoping by luck to find the lighted path to peace and stability.

Despite the best hopes for an Iraqi democracy, the Iraqi people and the
world see only the worst fears of occupation. Instead of inspiring steps
toward self-government, we witness hit-and-run murders of U.S. soldiers,
terrorist attacks and sabotage. Our military action in Iraq has forged a
caldron of contempt for America, a dangerous brew that may poison the
efforts of peace throughout the Middle East and result in the rapid
invigoration of worldwide terrorism.

The president's stubborn insistence that much of the world be shut out of
real participation in the rebuilding effort in Iraq is obviously costing
lives. In addition, it is costing the United States credibility in Iraq and
around the globe. We promised to improve the quality of life, yet so far we
have failed to deliver. As a result, increasing numbers of Iraqis see the
United States only as occupier, not liberator.

Instead of giving the young people of Iraq a reason to turn away from the
violence of terrorism, we have, through failures and unkept promises, fed
the seeds of discontent. The inability of the United States to secure the
peace in Iraq virtually guarantees al Qaeda a fertile field of new recruits.

War has proved far easier than peace. We had the weapons to win the war, but
not the wisdom to secure the peace. The coalition of those who might be
willing to share the burden of building a new Iraq will be harder to muster
now. But the challenge is too great for the United States alone. The rapidly
rising anti-American sentiment demands that an international effort be
initiated before Iraq slips from decades of dictatorship to decades of

The administration's reconstruction effort is costing the American people $1
billion a week. It is costing the lives of American soldiers and of
civilians from many nations. Only an entirely closed mind could fail to
grasp the need for a change in course. Close cooperation with the
international community might yet yield a plan for peace and security for
the people of Iraq. Haughty statements and unilateral actions will not
advance our cause. We must work with other countries to forge what we cannot
achieve alone: a lasting peace for Iraq and, in fact, for the Middle East
region as a whole.

A hallmark of true leadership is the ability to admit when one is wrong and
to learn from errors. Candidate George W. Bush spoke about the need for
humility from a great and powerful nation. He said, "Let us reject the
blinders of isolationism, just as we refuse the crown of empire. Let us not
dominate others with our power -- or betray them with our indifference. And
let us have an American foreign policy that reflects American character. The
modesty of true strength. The humility of real greatness." It is time for
the Bush administration to swallow its false pride and return to that
philosophy of humility before it is too late.

Washington Post, 27th August

Excerpts of remarks by L. Paul Bremer, administrator of the Coalition
Provisional Authority in Iraq, during an interview yesterday with Washington
Post editors and reporters:

The importance of success in Iraq: "I think the stakes are extremely high in
getting it right in Iraq. . . . This has become one of the main fields of
battle against global terrorism, and we cannot allow the terrorists to have
their way there. Secondly it is an important place to succeed because it
does provide a new model of how governments in that region can organize
themselves to be responsive to the needs of their people, in short,

Water and power systems: "The U.N. estimates that to get a more or less
satisfactory potable water system in the country will cost $16 billion over
four years. The 2,000 megawatts we need to add now just to meet current
demand will cost $2 billion, and the engineers tell me we probably should
spend about $13 billion over the next five years to get the power system [in
good order]."

Oil industry: "We intend to get our oil production back to prewar levels,
which was between 2.5 and 3 million barrels a day of production. We intend
to get back there by October of next year. We may get there earlier if we're
lucky, we may get there later if we have more sabotage. What is important is
that the Iraqi people realize that the oil revenues belong to them."

The 25-member Iraqi Governing Council: "I think they're doing okay. They
basically have several important tasks: to appoint a cabinet, to approve a
budget for 2004, [and] they are responsible for figuring out how to get a
new constitution written. We can't have elections at the moment because
there is no constitutional provision for elections. So they're going to have
to figure out how to get a constitution written."

Timetable for elections: "I've said don't think it's unrealistic to think
you could write a constitution in six or eight months. If it took them six
or eight months to write a constitution and then it takes a couple of more
months to organize elections, you could imagine that happening next year,
but it's not my timetable."

Security: "There are three elements to the security situation. There is
first of all the attacks on the coalition forces themselves. There is
secondly terrorism and there is thirdly crime. On the attacks on the
coalition force themselves, these attacks have been small-scale. They pose
no strategic threat to the United States or to the coalition forces. . . .
They are being conducted by Baathists. . . . The second security threat and
the one that is I think now of considerable concern is the growing terrorist
threat. We have seen it in the last six or eight weeks, essentially two
elements of the terrorist threat. One, of the arrival of what you could call
foreign terrorists, foreign fighters, who carry documentation from places
like Syria, Sudan, Yemen, and who may be linked in some ways to elements of
the Baathist types. It's not very clear. And then of course we have the
arrival in the country of scores of Ansar al-Islam terrorists who are
associated with al Qaeda."

Protecting U.S. forces: "First of all we are trying to get a much better
sense of the enemy, and that involves getting better intelligence, whether
it is against the guys attacking our forces, the terrorists or the
criminals. And in order to do that, I've got a more focused effort within
the U.S. government on intelligence, and we are encouraging more cooperation
from the Iraqis. One of the encouraging things in the last month or so has
been the number of Iraqis who have been willing to come in and give us
information. The second thing we are doing is we are reconfiguring our
forces. We need forces and we're moving toward forces which are lighter,
which are more mobile, which can move around the country and strike at will
against the enemy."

Training police and security personnel: "We are making a major effort to get
the Iraqis more involved in their own security, and this has basically four
dimensions. First, get a competent, large Iraqi police force on the ground.
Secondly, we are calling back the border police and the border patrols so
that we can start to get better controls over our borders. Thirdly, we have
recruited a new force called the facilities protection service. Their job is
to protect fixed sites, around banks, or a university or a ministry.
Fourthly, we have started to recruit the new Iraqi army. Fifth, we have
begun to raise an Iraqi civil defense corps. The intention is to have a
battalion of Iraqi civil defense in each of the 18 governances within the
next six months. We now have probably just short of 60,000 Iraqis already
involved in defending their own country, and it will be well over 100,000 a
year from now."

Search for weapons of mass destruction: "[CIA adviser] David Kay has now got
about 1,200 people in country working for him on weapons of mass
destruction. He's making progress. . . . I'm confident we will find evidence
of the biological and chemical programs."

Capturing Saddam Hussein: "Obviously, we'd like to have him, dead, or
capture him. He moves around, we think, a fair amount. We keep after him.
We'll get him and it is important to get him, because it's important to draw
the curtain down on the Baathist history in this country."

Yahoo, 27th August

PARIS (Reuters) - Richard Perle, a leading Pentagon (news - web sites)
adviser and architect of the U.S. war to topple Saddam Hussein (news - web
sites), said the United States had made mistakes in Iraq (news - web sites)
and that power should be handed over to the Iraqis as fast as possible.

In an interview with the Le Figaro daily newspaper to be published Thursday,
Perle defended the U.S.-led war in Iraq and restated his belief that France
had been wrong to lead international opposition to the conflict.

"Of course, we haven't done everything right," said Perle, according to the
French text of the interview. "Mistakes have been made and there will be

"Our principal mistake, in my opinion, was that we didn't manage to work
closely with the Iraqis before the war, so that there was an Iraqi
opposition capable of taking charge immediately," he said.

"Today, the answer is to hand over power to the Iraqis as soon as possible,"
he added.

Perle resigned in March as chairman of the Pentagon's Defense Policy Board
over alleged conflicts of interest, but remains an influential figure in
neo-conservative circles.

He also renewed criticism of President Jacques Chirac's refusal to back the
war. Chirac wanted more time for U.N. inspectors to search for any banned

The United States and Britain said Saddam had deliberately foiled the
inspections and failed to provide evidence that it had scrapped its
chemical, biological and nuclear programs.

"You have to understand that since September 11, the United States cannot
allow the most terrible weapons in the world to be in the hands of the worst
regimes in the world," Perle told Le Figaro, referring to the 2001 hijacked
airliner attacks on U.S. landmarks that killed some 3,000 people.

Washington and London used the weapons charge, dismissed by Iraq as a
pretext to wage war, to justify military intervention against Saddam. To
date, no such weapons have been found.

RFE/RL IRAQ REPORT, Vol. 6, No. 36, 29 August 2003

The U.S. State Department's International Information Programs website
( posted an official answer to a reporter's question
at the 20 August press briefing regarding international troop commitments to
Iraq. According to the State Department, 27 countries have contributed
21,700 troops to "ongoing stability operations" in Iraq. The countries are:
Albania, Azerbaijan, Bulgaria, the Czech Republic, Denmark, the Dominican
Republic, Georgia, El Salvador, Estonia, Honduras, Hungary, Italy,
Kazakhstan, Latvia, Lithuania, Macedonia, Mongolia, the Netherlands,
Nicaragua, Norway, Poland, Romania, Slovakia, South Korea, Spain, Ukraine,
and the United Kingdom. "In addition to the 27 countries with forces already
on the ground in Iraq, four others (Moldova, the Philippines, Portugal, and
Thailand) have committed to providing troops." Fourteen other countries are
still considering the U.S. request for troops. (Kathleen Ridolfo)

by Maura Reynolds
Los Angeles Times, 1st September

WASHINGTON ‹ With violence escalating and the death toll mounting, the Bush
administration insists it will stay the course in Iraq. But only in the last
few weeks has it said how long that might take: a generation or more.

"We and our allies must make a generational commitment to helping the people
of the Middle East transform their region," national security advisor
Condoleezza Rice said last month.

Administration officials describe Iraq as the linchpin in their ambitious
plans to transform the entire Mideast from autocracy and conflict to
democracy and peace. But while they express no doubts about the course they
have chosen, they are increasingly concerned about keeping the country on
board. As a result, top officials have adopted a new communications
strategy: comparing the occupation and rebuilding of Iraq to the occupation
and rebuilding of West Germany after World War II.

In choosing to compare Iraq to Germany, the administration appears to be
sending several messages.

First, that the Iraq war was a noble cause, as noble as fighting the Nazis.
Second, that the rebuilding will be lengthy, costly and complicated. And
third, that despite the difficulties, the United States can be successful in
Iraq, just as it was ultimately successful in Germany.

For all its expressions of confidence, the administration is clearly
concerned about maintaining public support for an occupation that has
suffered serious setbacks, among them the morale-sapping death toll from
guerrilla attacks on U.S. soldiers, the bombing of United Nations
headquarters and, on Friday, the assassination of Iraq's most prominent
pro-American Shiite leader.

Acknowledging the importance of public opinion, a senior Pentagon official
told The Times last week that three conditions are needed for success in
Iraq: "Patience, a commitment by the American people to sacrifice and the
will to win."

To maintain widespread public support, the official said, the administration
also needs to keep trumpeting another theme ‹ that if we don't fight Al
Qaeda in Iraq, we will wind up fighting it at home.

Polls show that Americans still overwhelmingly support the Iraq operation ‹
nearly two thirds of respondents told a Gallup Poll last week that they
believe the war was worthwhile. But the polls also show signs of growing

For instance, the Gallup Poll found 54% of respondents thought the
administration didn't have a clear plan for Iraq; just 44% believed it did.
Respondents were divided in assessing the postwar effort in Iraq: 49% said
they believed it was going moderately or very badly, and 50% said it was
going moderately or very well. That was before Friday's bombing in Najaf,
which killed 100 people, including Ayatollah Mohammed Bakr Hakim, an
influential Shiite cleric.

With Congress reconvening this week and the race for the Democratic
presidential nomination heating up, criticism of the administration's Iraq
policies is expected to intensify.

"It's a very uncertain situation as far as the public is concerned, so
[White House officials] are trying to clarify their long-term goals," said
Karlyn Bowman, a political analyst with the conservative American Enterprise

In a recent interview, Rice compared the United States' commitment to
rebuilding Iraq to the Marshall Plan, which helped turn not only West
Germany but other parts of a devastated, war-ridden Europe into one of the
world's most stable and prosperous regions.

But such a comparison is likely to make a deficit watcher break out in a
cold sweat. In today's dollars, the Marshall Plan would cost about $88
billion. But as a proportion of GDP, it was even more pricey ‹ between 2.5%
and 5% of the U.S. national economy each year. One scholar has estimated
that such a commitment would amount to $200 billion a year today.

Ivo Daalder of the Brookings Institution, a frequent administration critic,
sees a "huge disconnect between the stakes that are implied by the analogy
and the commitment this administration is making to bring the transformation

If the administration were serious about transforming the Middle East, it
would have planned better for the war's aftermath and would be asking
Americans for more substantial sacrifices, Daalder said. "Now, we're cutting
taxes, asking nothing of the American people," he said.

Historians see other problems with the analogy. Gerhard Weinberg, an eminent
German historian who is retired from the University of North Carolina, said
the devastation of Germany after the war went far beyond the current
situation in Iraq ‹ cities flattened by carpet bombing, more than 25% of
homes destroyed, most able-bodied men dead, injured or captured, millions of
refugees, roads and bridges blasted by retreating Nazis.

"You have a very much simpler problem in many ways in Iraq, but handled with
nothing like the care, planning and resources of postwar Germany," Weinberg

Lee Edwards of the conservative Heritage Foundation points out that while
the Marshall Plan is now widely considered a success, it was hotly debated
at the time of its inception. Congress took a full year to deliberate before
passing it, and that was during a period of congressional bipartisanship on
foreign policy.

"Any big, full-fledged Marshall Plan-style plan is probably not possible
today," Edwards said. "But something smaller-scale, with international
cooperation and semi-administration with the U.N. would encourage and
convince the American people that this was a good idea."

The Iraq issue is expected to come front and center after the administration
approaches Congress with a new funding request for the rebuilding effort,
perhaps as soon as this month. Many on Capitol Hill expect the number to be
large ‹ in the tens of billions of dollars. But some say that will be a good

"There is a hope here that they do it in one fell swoop," said a well-placed
congressional aide. "It will send clear signals that we're in for the long
run, and it will create a more stable dynamic inside Iraq."

And if the German analogy holds, that could create a more stable dynamic at

"The polls have always said people believe the peace would be much more
difficult than the war," Bowman said. "What [the administration] is trying
to say is, 'We've been here before. We've succeeded at this before. We can
do it again.' "

Times staff writer Janet Hook contributed to this report.

by Daniel Benjamin
Slate, 29th August

As American post-conflict combat deaths in Iraq overtook the wartime number,
the administration counseled patience. "The war on terror is a test of our
strength. It is a test of our perseverance, our patience, and our will,"
President Bush told an American Legion convention.

National Security Adviser Condoleezza Rice embellished the message with what
former White House speechwriters immediately recognize as a
greatest-generation pander. "There is an understandable tendency to look
back on America's experience in postwar Germany and see only the successes,"
she told the Veterans of Foreign Wars in San Antonio, Texas, on Aug. 25.
"But as some of you here today surely remember, the road we traveled was
very difficult. 1945 through 1947 was an especially challenging period.
Germany was not immediately stable or prosperous. SS officers-called
'werewolves'-engaged in sabotage and attacked both coalition forces and
those locals cooperating with them-much like today's Baathist and Fedayeen

Speaking to the same group on the same day, Secretary of Defense Donald
Rumsfeld noted,

One group of those dead-enders was known as "werewolves." They and other
Nazi regime remnants targeted Allied soldiers, and they targeted Germans who
cooperated with the Allied forces. Mayors were assassinated including the
American-appointed mayor of Aachen, the first major German city to be
liberated. Children as young as 10 were used as snipers, radio broadcasts,
and leaflets warned Germans not to collaborate with the Allies. They plotted
sabotage of factories, power plants, rail lines. They blew up police
stations and government buildings, and they destroyed stocks of art and
antiques that were stored by the Berlin Museum. Does this sound familiar?

Well, no, it doesn't. The Rice-Rumsfeld depiction of the Allied occupation
of Germany is a farrago of fiction and a few meager facts.

Werwolf tales have been a favorite of schlock novels, but the reality bore
no resemblance to Iraq today. As Antony Beevor observes in The Fall of
Berlin 1945, the Nazis began creating Werwolf as a resistance organization
in September 1944. "In theory, the training programmes covered sabotage
using tins of Heinz oxtail soup packed with plastic explosive and detonated
with captured British time pencils," Beevor writes. ". Werwolf recruits were
taught to kill sentries with a slip-knotted garrotte about a metre long or a
Walther pistol with silencer. ."

In practice, Werwolf amounted to next to nothing. The mayor of Aachen was
assassinated on March 25, 1945, on Himmler's orders. This was not a nice
thing to do, but it happened before the May 7 Nazi surrender at Reims. It's
hardly surprising that Berlin sought to undermine the American occupation
before the war was over. And as the U.S. Army's official history, The U.S.
Army in the Occupation of Germany 1944-1946, points out, the killing was
"probably the Werwolf's most sensational achievement."

Indeed, the organization merits but two passing mentions in Occupation of
Germany, which dwells far more on how docile the Germans were once the
Americans rolled in-and fraternization between former enemies was a bigger
problem for the military than confrontation. Although Gen. Eisenhower had
been worrying about guerrilla warfare as early as August 1944, little
materialized. There was no major campaign of sabotage. There was no
destruction of water mains or energy plants worth noting. In fact, the far
greater problem for the occupying forces was the misbehavior of desperate
displaced persons, who accounted for much of the crime in the American zone.

The Army history records that while there were the occasional
anti-occupation leaflets and graffiti, the GIs had reason to feel safe. When
an officer in Hesse was asked to investigate rumors that troops were being
attacked and castrated, he reported back that there had not been a single
attack against an American soldier in four months of occupation. As the
distinguished German historian Golo Mann summed it up in The History of
Germany Since 1789, "The [Germans'] readiness to work with the victors, to
carry out their orders, to accept their advice and their help was genuine;
of the resistance which the Allies had expected in the way of 'werewolf'
units and nocturnal guerrilla activities, there was no sign. ."

Werwolf itself was filled not so much by fearsome SS officers but teenagers
too young for the front. Beevor writes:

In the west, the Allies found that Werwolf was a fiasco. Bunkers prepared
for Werwolf operations had supplies "for 10-15 days only" and the fanaticism
of the Hitler Youth members they captured had entirely disappeared. They
were "no more than frightened, unhappy youths." Few resorted to the suicide
pills which they had been given "to escape the strain of interrogation and,
above all, the inducement to commit treason." Many, when sent off by their
controllers to prepare terrorist acts, had sneaked home.

That's not quite the same as the Rumsfeld version, which claimed that "Today
the Nazi dead-enders are largely forgotten, cast to the sidelines of history
because they comprised a failed resistance and managed to kill our Allied
forces in a war that saw millions fight and die."

It's hard to understand exactly what Rumsfeld was saying, but if he meant
that the Nazi resisters killed Americans after the surrender, this would be
news. According to America's Role in Nation-Building: From Germany to Iraq,
a new study by former Ambassador James Dobbins, who had a lead role in the
Somalia, Haiti, Bosnia, and Kosovo reconstruction efforts, and a team of
RAND Corporation researchers, the total number of post-conflict American
combat casualties in Germany-and Japan, Haiti, and the two Balkan cases-was

So, how did this fanciful version of the American experience in postwar
Germany get into the remarks of a Princeton graduate and former trustee of
Stanford's Hoover Institute (Rumsfeld) and the former provost of Stanford
and co-author of an acclaimed book on German unification (Rice)? Perhaps the
British have some intelligence on the matter that still has not been made
public. Of course, as the president himself has noted, there is a lot of
revisionist history going around.

by James Gooder
Aljazeera, 1st September

Nearly 40,000 of America's frontline soldiers are not US citizens.

Many of the troops on duty in Iraq do not count English as their first
language and would prefer to take orders in their native tongue ... usually

The revelation has prompted British MP George Galloway, one of the fiercest
critics of the invasion of Iraq, to accuse the US of using its "green card"
troops as cannon fodder.

Galloway went on to attack the US policy of putting its poor minorities and
non-citizens in the frontline of its foreign wars.

In an exclusive interview he told that it was part of a long
US tradition of using its underclass as cannon fodder.

The statistics, buried by White House spin doctors, reveal that a
significant minority of troops fighting under the US banner are not in fact
US citizens but residents hoping to speed up their citizenship.

Galloway said that this was typical of a government used to having the
marginalised fight its battles.

"Nothing has changed since that last failed attempt to invade and determine
the future of another country, Vietnam," he told from his
holiday villa in Portugal.

"The proportion of blacks in the army was 40%, while in the US
population the number of blacks was a quarter of that," he said

"Of course the underclass has now become increasingly more Hispanic than

Disproportionate casualties

This explains why a disproportionate number of the so-called US casualties
in the invasion and occupation of Iraq have borne Latino names.

Galloway says that on a weekly Atlanta radio show in which he participates,
the callers have repeatedly claimed that Blacks and Hispanics are the fodder
army recruiters are after.

The Pentagon says that there are 37,401 non-US citizens on active duty, and
that joining up has a special incentive for them - an American passport.

"The military services have processes and programmes in place to help
service members expedite their citizenship," says a US Department of Defence

"The estimated time for the application is about six months."

Citizenship has been especially hard to come by due to the draconian
immigration rules imposed by the US Department of Homeland Security since
the 11 September 2001 attacks.

It can take several years to gain citizenship, for those lucky enough to get
it. Signing up to the army can speed this up, provided the GI comes home


Other incentives under the Montgomery GI Bill include the promises
of a college fund of up to $50,000, post service employment and training.

But activist Carlos Mendes of the Latinos Against the War in Iraq coalition
says that many soldiers have told him that these promises often fail to

The US military relies on volunteers, the Pentagon argues, and there is no
official draft, therefore no pressure on anyone to sign up.

Yet in a country where further education is prohibitively expensive, and
medical care privatised, these incentives deliberately target America's poor
minorities, as well as those desperate for citizenship, freeing the sons and
daughters of those with money and influence from service.

"The people who made the decisions never sent their sons to get hot, bloody
and dirty on the battlefield," he said.

Even when there was a draft, the decision-makers stayed out of trouble. "The
white sons of the rulers of America, including a certain George W Bush, have
always found ways around the draft, in his case through his bogus service in
the air auxiliary, while Dick Cheney took one course after another at
university," he said.

Outspoken critic

Galloway, the Glasgow Kelvin MP who has consistently criticised US and
British policy on Iraq, famously called Bush and Blair "wolves" over their
war-like rhetoric leading up to the invasion.

He opposed UN sanctions imposed after the last Gulf War complaining that
they inflicted huge suffering on ordinary Iraqis.

Mr Galloway has visited Iraq on numerous occasions and met the country's
former president and major figures in the Baathist government.

But he was also a vigorous campaigner during the Thatcher years, picketing
the Iraqi embassy in London, when the Conservative government supplied arms
to Saddam Hussein.

by Vicki Allen
Yahoo, 2nd September

WASHINGTON (Reuters) - The Bush administration may have to cut U.S. troops
in Iraq (news - web sites) by more than half to keep enough forces to face
other threats, a congressional agency said on Tuesday in a report that
fueled calls for more international help for peacekeeping in Iraq.

The Congressional Budget Office (news - web sites) said under current
policies, the Pentagon (news - web sites) would be able to sustain an
occupation force of 38,000 to 64,000 in Iraq long term, down from the
existing 150,000 that a number of lawmakers said is not enough to confront
the spiraling violence.

Sen. Robert Byrd (news, bio, voting record), a West Virginia Democrat who
requested the CBO study, said it showed that President Bush (news - web
sites)'s policies in Iraq were "straining our forces to the breaking point."

Byrd, one of Bush's harshest critics on Iraq, also said it showed the
administration must formally ask for help in peacekeeping from the United
Nations (news - web sites) and NATO (news - web sites).

"Every day frittered away by the administration is another day that our
troops will bear the staggering burdens of the dangers of occupation alone,"
he said.

Bush on Tuesday directed Secretary of State Colin Powell (news - web sites)
to open negotiations at the U.N. Security Council on a resolution aimed at
getting international support for U.S. efforts in Iraq, a senior U.S.
official said.

Some lawmakers are pushing to increase overall military manpower for Iraq
and other needs.

The CBO said it would cost up to $19 billion and take three to five years to
recruit, train and equip two more divisions with about 80,000 in troops and
support personnel.

Keeping the 20,000 in additional forces and support personnel the divisions
would provide in Iraq would cost about $10 billion annually, boosting
occupation costs to some $29 billion a year, it said.

A U.S. occupying force of less than 64,000 would cost between $8 billion and
$10 billion a year, the CBO said, while a force of up to 106,000 adding
Marines and other ground forces would cost $14 billion to $19 billion.

The Pentagon estimates it is costing $3.9 billion a month to keep the
roughly 150,000 troops now in Iraq, where they make up 90 percent of the
peacekeeping forces.

The report said the active Army, which is bearing the brunt of Iraq duty,
will have to start reducing forces in Iraq in March next year if it keeps
its plan to limit deployments without relief to a year.

Under existing policies, the CBO said, the Army could sustain a long-term
occupation force there of 38,000 to 64,000 after the winter of 2004-2005.

The CBO also offered alternative scenarios if the Pentagon made more use of
National Guard, reserves, Marines and civilian personnel in Iraq.

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