Feb 27, 2008

Tasseography - Fistfull of Polls


40 years ago, the US invasion of South Vietnam was in its fourth year and the surge of that day was about to add another 100,000 troops to the 175,000 already there, while South Vietnam was being bombed at triple the level of the bombing of the north and the war was expanding to the rest of Indochina. Still, the war would not go well, so the hawks were shifting towards doubts, among them the distinguished historian and Kennedy adviser Arthur Schlesinger. He and Kennedy -other Kennedy liberals had already begun - reluctantly began to shift from a dedication to victory to a more dovish position.

Schlesinger explained the reasons. I’ll quote him now:

“Of course, we all pray that the hawks are right in thinking that the surge of that day will work. And if it does, we may all be saluting the wisdom and statesmanship of the American government in winning a victory in a land that we have turned to wreck and ruin. But the surge probably won’t work, at an acceptable cost to us, so perhaps strategy should be rethought.”

Well, the reasoning and the underlying attitudes carry over with almost no change to the critical commentary on the US invasion of Iraq today. And it is a land of wreck and ruin. The British polling agency, Opinion Research Business, has recently updated its estimate of deaths. Their new estimate is 1.3 million, excluding two of the most violent provinces, Karbala and Anbar. On the side, it’s kind of intriguing to observe the ferocity of the debate over the actual number of deaths. There’s an assumption on the part of hawks that if we only killed a couple hundred thousand people, it might not be so bad, so we shouldn’t accept the higher estimates. You can go along with that if you like.

Uncontroversially, there are over two million displaced within Iraq. Thanks to Jordan and Syria, the millions of refugees who have fled the wreckage of Iraq aren’t totally wiped out. That includes most of the professional classes. But that welcome is fading, because Jordan and Syria receive no support from Washington and London, and therefore they cannot accept that huge burden for very long. It’s going to leave those two-and-a-half million refugees who fled in even more desperate straits.

The post-invasion sectarian warfare has devastated the country, as you know. Much of the country has been subjected to rather brutal ethnic cleansing and left in the hands of warlords and militias. That’s the primary thrust of the current counterinsurgency strategy that’s developed by Petraeus. He won considerable fame pacifying Mosul a couple of years ago. It’s now, perhaps only coincidentally so, the scene of some of the most extreme violence in the country.

A bleeding-heart journalist immersed in the ongoing messiness, Nir Rosen, recently wrote an epitaph entitled “The Death of Iraq” [5-page pdf]in the somewhat mainstream-ish journal Current History . He writes that “Iraq has been killed, never to rise again. The American occupation has been more disastrous than that of the Mongols, who sacked Baghdad in the thirteenth century,” which has been the perception of many Iraqis, as well. “Only fools talk of ‘solutions’ now,” he went on. “There is no solution. The only hope is that perhaps the damage can be contained.” This is what I hear from my friends in place - they don't speak of winning, they speak of how now to administrate a failure.

But Iraq is, in fact, now a marginal(ized) issue, and the reasons are the traditional ones, the traditional reasoning and attitudes of the liberal doves who all pray now, as they did forty years ago, that the hawks will be right and that the US will win a victory in this land of wreck and ruin. And they’re either encouraged or silenced by the good news about Iraq.

And there is good news. The Multi-National Force–Iraq, (I think three Poles are still battling it out in there somewhere) carries out extensive studies of popular attitudes. It’s an important part of counterinsurgency or any form of domination - you want to know what your subjects are thinking. It released a report last December. It was a study of focus groups, and it was uncharacteristically upbeat. The report concluded—I’ll quote it—that the survey of focus groups “provides very strong evidence” that national reconciliation is possible and anticipated, contrary to what’s being claimed. The survey found that a sense of “optimistic possibility permeated all focus groups…and far more commonalities than differences are found among these seemingly diverse groups of Iraqis” from all over the country and all walks of life. This discovery of “shared beliefs” among Iraqis throughout the country is “good news, according to a military analysis of the results," Karen de Young reported in the Washington Post.

Well, the “shared beliefs” are identified in the report. I’ll quote de Young: "Iraqis of all sectarian and ethnic groups believe that the US military invasion is the primary root of the violent differences among them, and see the departure of [what they call] ‘occupying forces’ as the key to national reconciliation.” So those are the “shared beliefs.” According to the Iraqis then, there’s hope of national reconciliation if the invaders, who are responsible for the internal violence and the other atrocities, withdraw and leave Iraq to Iraqis. That’s pretty much the same as what’s been found in earlier polls, so it’s not all that surprising. Well, that’s the good news: “shared beliefs.”

There was a recent poll which found that 75 percent of Americans believe that US foreign policy is driving the dissatisfaction with America abroad, and more than 60 percent believe that dislike of American values and of the American people are also to blame. Dissatisfaction is a kind of an understatement. The United States has become increasingly the most feared and often hated country in the world. Well, that perception is in fact incorrect. It’s fed by propaganda. There’s very little dislike of Americans in the world, shown by repeated polls, and the dissatisfaction—that is, the hatred and the anger—they come from acceptance of American values, not a rejection of them, and recognition that they’re perceived to be rejected by the US government, which does indeed seem to rile some fickle folks up.

There’s other good news that was reported by General Petraeus and Ambassador Ryan Crocker during the extravaganza staged last September 11th. ("September 11th?", you might ask. "Why that timing?" ;) ) Petraeus and Crocker provided figures to explain the good news. The figures they provided showed that the Iraqi government was greatly accelerating spending on reconstruction, which is good news indeed and remained so until it was investigated by the Government Accountability Office [17-page pdf], which found that the actual figure was one-sixth of what Petraeus and Crocker reported and, in fact, a 50 percent decline from the previous year.

Well, more good news is the decline in sectarian violence; that’s attributable in part to the ethnic cleansing that Iraqis blame on the invasion. There are fewer people to kill, so sectarian violence declines. It’s also attributable to the new counterinsurgency doctrine, Washington’s decision to support the tribal groups that had already organized to drive out Iraqi al-Qaeda, to an increase in US troops, and to the decision of the Sadr’s Mahdi army to consolidate its gains to stop direct fighting. (That’s what the press calls “halting aggression” by the Mahdi army.)

Well, it’s possible that Petraeus’s strategy may approach the success of the Russians in Chechnya, where—I’ll quote the New York Times from last September — Chechnya, the fighting is now “limited and sporadic, and Grozny is in the midst of a building boom” after having been reduced to rubble by the Russian attack. Well, maybe some day Baghdad and Fallujah also will enjoy, to continue the quote, “electricity restored in many neighborhoods, new businesses opening and the city’s main streets repaved,” as in booming Grozny. Possible, but dubious, in the light of the likely consequence of creating warlord armies that may be the seeds of even greater sectarian violence. Well, if Russians share the beliefs and attitudes of elite liberal intellectuals in the West, then they must be praising Putin’s “wisdom and statesmanship” for his achievements in Chechnya. "High five, Putin!"

Washington has expectations for Iraq, and they’re explicit. They're outlined in a Declaration of Principles that was agreed upon between the United States and that Iraqi government we installed under our occupation. These two parties issued the Declaration of Principles. It allows US forces to remain indefinitely in Iraq in order to “deter foreign aggression”—and also to facilitate and encourage “the flow of foreign investments [to] Iraq, especially American investments.” I’m quoting. Not exactly an unbrazen expression of intent.

Such expectations were bulwark'd when POTUS issued a signing statement declaring that he will reject crucial provisions of congressional legislation that he had just signed, including the provision that forbids spending taxpayer money—I’m quoting—“to establish any military installation or base for the purpose of providing for the permanent stationing of [United States] Armed Forces in Iraq” or “to exercise [United States] control of the oil resources of Iraq." OK? Shortly after, the New York Times reported that Washington “insists that the Baghdad government give the United States broad authority to conduct combat operations,” a demand that “faces a potential buzz saw of opposition from Iraq, with its…deep sensitivities about being seen as a dependent state.” It’s supposed to be more third world irrationality.

So, in brief, the United States is now insisting that Iraq must agree to allow permanent US military installations, provide the United - whoops, grant the United States the right to conduct combat operations freely, and to guarantee US control over the oil resources of Iraq. OK? It’s all very explicit, on the table. It’s kind of interesting that these reports do not elicit any reflection on the reasons why we invaded Iraq. You’ve heard those reasons offered, but they were dismissed with ridicule. Now they’re openly conceded to be accurate, but not eliciting any retraction or even any reflection.

Well, there’s a lot more to say about good news when I should just shut up and revere our Lord of COIN so I will just say that thinking about these things perhaps gives some insight into the famous “clash of civilizations” and its actual substance, topics that ought occasionally to be foremost in the minds of those serious about wanting to win this effing bastard of a thing.

9 comments:

Adrian said...

I do not understand the idea that we invaded Iraq to control its oil. If we wanted its oil, why wouldn't we have just bought it from Saddam? He was more than willing to sell to anyone he could.

Meatball One said...

I think it might be helpful to always qualify the use of the word We

Sure, a certain category of We can always buy the goo and its derivatives on the open market. No problems.

Then there's another category of We. That's a We that wants to pump it up cheaply in Iraq and maximize revenues by minimizing the share of which goes to the State whose lands hold the oil resides in.

Below are some excerpts from suggested readings that scrape the surface of a few of the complexities at hand, some of which are fueling violent schisms and power plays in Iraq.

First out an excerpt from the UK's Independent:
http://tiny.cc/n4P16

Iraq's massive oil reserves, the third-largest in the world, are about to be thrown open for large-scale exploitation by Western oil companies under a controversial law which is expected to come before the Iraqi parliament within days.

The US government has been involved in drawing up the law, a draft of which has been seen by The Independent on Sunday. It would give big oil companies such as BP, Shell and Exxon 30-year contracts to extract Iraqi crude and allow the first large-scale operation of foreign oil interests in the country since the industry was nationalised in 1972.

Oil industry executives and analysts say the law, which would permit Western companies to pocket up to three-quarters of profits in the early years, is the only way to get Iraq's oil industry back on its feet after years of sanctions, war and loss of expertise. But it will operate through "production-sharing agreements" (or PSAs) which are highly unusual in the Middle East, where the oil industry in Saudi Arabia and Iran, the world's two largest producers, is state controlled.

Opponents say Iraq, where oil accounts for 95 per cent of the economy, is being forced to surrender an unacceptable degree of sovereignty.

Supporters say the provision allowing oil companies to take up to 75 per cent of the profits will last until they have recouped initial drilling costs. After that, they would collect about 20 per cent of all profits, according to industry sources in Iraq. But that is twice the industry average for such deals.

Greg Muttitt, a researcher for Platform, a human rights and environmental group which monitors the oil industry, said Iraq was being asked to pay an enormous price over the next 30 years for its present instability. "They would lose out massively," he said, "because they don't have the capacity at the moment to strike a good deal."

Several major oil companies are said to have sent teams into the country in recent months to lobby for deals ahead of the law, though the big names are considered unlikely to invest until the violence in Iraq abates.

James Paul, executive director at the Global Policy Forum, the international government watchdog, said: "It is not an exaggeration to say that the overwhelming majority of the population would be opposed to this. To do it anyway, with minimal discussion within the [Iraqi] parliament is really just pouring more oil on the fire."

Vince Cable, the Liberal Democrat Treasury spokesman and a former chief economist at Shell, said it was crucial that any deal would guarantee funds for rebuilding Iraq. "It is absolutely vital that the revenue from the oil industry goes into Iraqi development and is seen to do so," he said. "Although it does make sense to collaborate with foreign investors, it is very important the terms are seen to be fair."

Now a tad of background on revenue sharing schemes at Cambridge Journals:
http://journals.cambridge.org/download.php?file=%2FNLR%2FNLR52_01%2FS0165070X05000318a.pdf&code=e7a0c836861466a4a467b20ce538f628 [26-page pdf]



During the early stages of de-colonization in the late 1950s and early 1960s the concept of permanent sovereignty over natural resources was framed. This admittedly had a twofold dimension. On the one hand, newly independent states asserted their right to free themselves from the onerous concession contracts inherited from their colonial past, while on the other hand it was agreed that

‘[t]he right of peoples and nations to permanent sovereignty over their natural wealth and resources must be exercised in the interest of their national development and of the well-being of the people of the State concerned’.

This second element has proved problematic for developing nations.

The issue of land and subsoil ownership falls within the remit of two legal frameworks; the first relates to the constitutional and property(essentially land) legislation of the state concerned, whereas the second, which is still an emerging and undeveloped area of law, views property from an international human rights point of view.11 Immovable property forms an integral aspect of the internal aspect of self-determination, in the sense that the beneficiaries of all benefits accruing from ownership,use or exploitation are the people of the state where these are situated.12 This necessitates that the profits from such operations be fed into the national economy in such a way as to benefit the entire population. Conversely, this right of self-determination in connection to natural resources could very well preclude extraction where the disturbance of a fragile ecosystem or of a particular socio-economic status quo is not overweighed by the benefits of extraction.

There are two broad types of hydrocarbon and minerals activities or phases of operation: upstream and downstream activities. The former includes all activities related to exploration, development and production of mineral assets up to the point where the minerals extracted are in a marketable condition without further processing.

Upstream operations can be divided in the following phases: prospecting, acquisition of mineral rights, exploration, appraisal or evaluation, development, construction, production and closure/abandonment.

Downstream activities involve further processing of the minerals from refinement to placing them on the market as products fit for consumption.

In the first half of the twentieth century oil-rich states granted generous concessions to international petroleum companies18 under the stipulation that while title to oil was conveyed to the company the host states were to receive merely a one-eighth royalty. This regime was abruptly altered with a wave of expropriations of concessions slightly prior to World War II, followed by 50-50 agreements initiated by Venezuelan practice in 1943.

Further resentment of benefits accumulated by foreign companies at the expense of oil-rich states culminated eventually in legal regimes more beneficial for the host state by the 1970s. During this period western oil company revenues were further slashed by an increase in taxation and royalty rates, such as in the case of the ‘Abu Dhabi formula’, adopted by the Gulf states in 1974. Current contractual regimes are based on a range of models, the most popular being Production Sharing Agreements (including Service Agreements)19 and regulation through licences and concessions.

In the license system, the state, as the owner of mineral resources on its territory, grants to the investor the right to explore, develop and produce such resources under the specific terms of the license.Since,therefore,the license is granted by the state in its capacity as a sovereign it is not a contract, unless otherwise agreed, and its terms and conditions can be unilaterally altered or revoked by the state subject only to the limitations prescribed under its public law.

The lack of a contractual nature governing the license system, which in turn inhibits investment, has made oil-rich states gradually turn to a new form of investment regime, that of Production Sharing Agreements (PSA). These are generally based on a contract between the investor and the host country, whereby the investor is granted the right to carry out petroleum operations. The agreement further stipulates the profits of both the investor and the state, after calculating the investor’s operational expenses (all expenses and risk is borne by the investor) as well as possible taxes incurred from such operations. Generally,
the host state retains ownership of all extracted hydrocarbons or mineral reserves as a result of PSAs.21 The concessionary system rests on an agreement between the company and the host state, whereby the former is granted the right to explore for, develop, produce, transport and market hydrocarbons or minerals within a fixed area for a specific amount of time.The production and sale of hydrocarbons or minerals is thereafter subject to rentals, royalties, bonuses and taxes. Under the concessionary system the company holds title to the resources produced.

Whether the upstream activities are regulated by contract, concession or license, the enormity and scale of such operations suggest that the investor (or operator) will in most cases not be able to carry out all the related operations alone. In practice, one or multiple joint ventures will be established, whereby the initial operator will subcontract other specialized companies to carry out some aspects of the whole operation, including partners whose only function is to partly finance the operation.At this stage either the World Bank or other private financial institutions will be actively involved.The Bank and other private financial institutions will agree to fund the project only if the country is IMF compliant and where a political risk insurer agrees to provide such cover. The host state will also partake in these joint ventures through the establishment
of a public corporation that participates in the upstream activities and is a shareholder in the equity established – at least as far as hydrocarbon operations are concerned. What is particularly problematic for the purposes of this study is the fact that most developing countries do not make public the content of their PSAs or the royalties, bonuses and other payments involved. Moreover, possible arbitration proceedings regarding differences between the parties are also covered by a veil of confidentiality.

Poverty alleviation and development is critically dependent on bringing growth to poor areas. Although the accumulation of financial capital ,investments,natural resources and sufficient human capital may lead to growth, yet countries with small quantities of such factors have managed to prosper, while others with abundance are still suffering underdevelopment.

Economists in the World Bank argue that the key to poverty reduction is creating jobs, which in statistics shows up as growth. This, however, requires a sound regulatory and institutional regime within a country, such that provides entrepreneurial incentives
to corporations, which represent the ‘vehicles that spread best practices and productive jobs to areas where poor people live’.24 Until very recently the politics of development were centered on the actions of states in creating and maintaining a suitable framework for investment, as well as on the voluntary contribution of developed countries as aid donors. The focus has now shifted to encompass multinational corporations, including public and private financial institutions, developing states and public international organizations as a combination
of actors capable of achieving and contributing to growth.25 However, with the exception of the United Nations, all the other actors have pursued their own agenda without a shared goal of development. Thus, the World Bank pursued policies with little concern to social impacts, multinational corporations (MNEs) too demonstrated feeble sensitivity to social and environmental matters in countries that allowed them to operate with impunity, and host developing states in their vast majority fed this cycle of poverty through corruption.


To fill anecdotal quotas, proceed to read this rejection by the Kurdish Regional Government (KRG)of the Iraqi Oil Law. http://tiny.cc/DRNP6 Below is an excerpt:

The Kurdish Regional Government has rejected the Iraqi Draft Oil Law and specifically the annexes to the law circulated at a recent meeting in Dubai, “the Dubai Annexes”. The KRG would declare the law “void as unconstitutional”, if it is approved in its current form.

In the light of the recent developments, the Kurdistan Regional Government (KRG) expresses serious concerns regarding the draft Annexes to the proposed Oil and Gas Law that were recently circulated, and that were discussed last Wednesday at a conference in Dubai (“the Dubai Annexes”).

These are concerns that should be shared by all Iraqi citizens. In summary, the Dubai Annexes are inconsistent with the overriding policy goal of maximizing economic returns to the Iraqi people, and inconsistent with Iraq’s federal Constitution. The Dubai Annexes are inconsistent with the proposed Oil and Gas Law that was agreed by the Council of Ministers on 15 February 2007.


Then move on to reading this fine CRS Report for Congress entitled - Iraq: Oil and Gas Legislation, Revenue Sharing, and U.S. Policy.
http://tiny.cc/WjyWM


Next up is:
U.S. Influence on Iraqi Oil
http://tiny.cc/WMXca Below the entire piece:



"The oil belongs to the Iraqi people. It's their asset," declared President George W. Bush in a press conference on the White House lawn in June 2006. He had just returned from a surprise visit to Baghdad, in which oil had been one of the main subjects of discussion.

"We talked about how to advise the government to best use that money for the benefit of the people," he clarified.

But by January 2007, the euphemism of "advice" had been dropped, as passage of an oil law became a "benchmark," an instruction to the Iraqi government.

Violating the very notions of freedom and democracy Bush invokes in nearly every speech on Iraq, the U.S. government has actively intervened in the restructuring of Iraq's oil industry since at least 2002. At different times, the Iraqi government has been threatened that passing the oil law was a pre-condition for partial reduction of Saddam Hussein's debts, for the provision of reconstruction funds, and even for the continued survival (through U.S. military support) of the al-Maliki government itself.

The issues could hardly be more important for Iraq. Oil accounts for more than 90% of government revenue, and is the main driver of Iraq's economy. And decisions made in the coming months will not be reversible—once contracts are signed, they will have a major bearing on Iraq's economy and politics for decades to come.

No wonder polls have shown that roughly 75% of Iraqis think one of the main reasons why the United States invaded Iraq was "to control Iraqi oil."1

Attempting to reverse this perception and change U.S. policy, lawmakers passed legislation stating that the United States should not exert "control over any oil resource of Iraq." But contradicting this sentiment, the Congress also passed a law that required reporting on a set of U.S. imposed benchmarks, which included language for the Iraqi parliament to pass " legislation to ensure the equitable distribution of hydrocarbon resources." The administration has used this benchmark to push a law that has almost nothing to do with revenue distribution among Iraq's sectarian groups, and everything to do with creating highly profitable opportunities for multinational oil corporations.2

Under pressure from the U.S. government, the Iraqi cabinet has endorsed the controversial oil law, which now awaits approval in the Parliament. Yet among Iraqis, the law faces extensive opposition, including from two of the law's three original authors—as well as more than 100 of Iraq's most senior oil experts, the powerful oil unions, and other religious and secular civil society organizations.

Ironically, the law deemed to be needed to bring the country together, instead has the potential to violently rip it apart.

Oil Pressure: A History of U.S. Involvement in Iraq's Oil Development

Feb.-March 2001: White House Energy Taskforce produces a list of "Foreign Suitors for Iraqi Oilfield Contracts."3

December 2002-April 2003: U.S. State Department Oil and Energy Working Group brought together influential Iraqi exiles, U.S. government officials, and international consultants. The result of the project's work was a "draft framework for Iraq's oil policy" that would form the foundation for the energy policy now being considered by the Iraqi Parliament. The final report noted that Iraq "should be opened to international oil companies as quickly as possible after the war.4 Later, several Iraqi members of the group became part of the Iraqi government. The Group included future Iraqi Oil Minister, Bahr al-Uloum.

January 2003: The Wall Street Journal reported that representatives from Exxon Mobil Corp., ChevronTexaco Corp., ConocoPhillips, and Halliburton, among others, were meeting with Vice President Cheney's staff to plan the post-war revival of Iraq's oil industry.5

January 2003: Phillip Carroll, a former chief executive with Royal Dutch-Shell, and a 15-member "board of advisers" were appointed to oversee Iraq's oil industry during the transition period. According to the Guardian, the group's chief executive would represent Iraq at meetings of the Organization of the Petroleum Exporting Countries (OPEC).6 Carroll had been working with the Pentagon for months before the invasion—even while the administration was still insisting that it sought a peaceful resolution to the Iraq crisis—"developing contingency plans for Iraq's oil sector in the event of war."

Carroll, in addition to running Shell Oil in the United States, was a former CEO of the Fluor Corporation, a well-connected oil services firm with extensive projects in Saudi Arabia and Kuwait and at least $1.6 billion in contracts for Iraq's reconstruction.

One month after the invasion, Carroll took control of Iraq's oil production for the U.S. Government. He was joined by Gary Vogler, a former executive with ExxonMobil, in Iraq's Office of Reconstruction and Humanitarian Assistance.

Mr. Carroll made it clear to Paul Bremer, the U.S. occupation chief who arrived in Iraq in May 2003, that, "There was to be no privatization of Iraqi oil resources or facilities while he was involved."7 Carroll leaves his job seven months later.

March 2003: Iraqi Oil Ministry was one of the few structures the invading forces protected from looters in the first days of the war.

April 2003: During the initial assault on Baghdad, soldiers set up forward bases named Camp Shell and Camp Exxon.8

April 2003: President Bush called for UN sanctions against Iraq to be dropped. The request sounds innocuous enough, but it masks an urgent U.S. desire for a free hand to start pumping Iraqi crude once again to raise funds for rebuilding the country.9

April 2003: USAID Solicits Bid to Draft Economic Reorganization Plan for Iraq. The U.S. Agency for International Development asks BearingPoint, Inc to bid on a sole-sourced contract for "economic governance" work in Iraq. The contract document was written by Treasury Department officials and reviewed by financial consultants. The confidential 100-page request, titled "Moving The Iraqi Economy From Recovery to Sustainable Growth," states that the contractor will help support "private sector involvement in strategic sectors, including privatization, asset sales, concessions, leases, and management contracts, especially in the oil and supporting industries."10

May 22, 2003: UN Security Council passed a resolution ending sanctions on Iraq. Significantly, the resolution gave the United States decision making power over how the oil funds would be used with regard to relief, reconstruction, disarmament, and "other purposes benefiting the people of Iraq."11

May 22, 2003: President Bush signed Executive Order 13303 providing full legal immunity to all U.S. oil companies doing business in Iraq in order to facilitate the country's "orderly reconstruction."

June 22, 2003: Iraq ships crude oil for the first time since the start of the war. Head of the Coalition Provisional Authority, Paul Bremer, broached the politically sensitive issue of how oil revenue should be spent, proposing that some of the money be shared with Iraqis through a system of dividend payments or a national trust fund to finance public pensions. "Iraq's resources cannot be restricted to a lucky or powerful few," Bremer said. "Iraq's natural resources should be shared by all Iraqis."12

July 2003: Bremer appoints the members of the Iraqi Government Council. Ibrahim Bahr al-Uloum, a member of the State Department's energy working group, is tapped as Iraq's oil minister. Al-Uloum soon proposed a privatization program, and endorsed production sharing agreements as the route to that goal.13

October 2003: Carroll was replaced by Robert McKee, a former ConocoPhillips executive. According to the Houston Chronicle, "His selection as the Bush administration's energy czar in Iraq" drew fire from Congressional Democrats "because of his ties to the prime contractor in the Iraqi oil fields, Houston-based Halliburton Co. He's the chairman of a venture partitioned by the ... firm."14

The administration selected ChevronTexaco Vice President Norm Szydlowski to serve as a liaison between the Coalition Provisional Authority and the Iraqi Oil Ministry. Now the CEO of the appropriately named Colonial Pipeline Company, Szydlowski continued to work with the Iraq Energy Roundtable, a project of the U.S. Trade and Development Agency, which sponsored meetings to "bring together oil and gas sector leaders in the United States with key decision makers from the Iraq Ministry of Oil."15 Terry Adams and Bob Morgan of BP, and Mike Stinson of ConocoPhillips would also serve as advisers during the transition.16

November 2003: McKee quietly ordered a new plan for Iraq's oil. The drafting would be overseen by a "senior adviser," Amy Jaffe, who had worked for Morse when he was the Chairman of the Council on Foreign Relations. Jaffe now works for James Baker, the former Secretary of State, whose law firm serves as counsel to both ExxonMobil and the defense minister of Saudi Arabia. The plan, written by State Department contractor BearingPoint, was guided, says Jaffe, by a handful of oil -industry consultants and executives.17

December 19, 2003: BearingPoint releases "Options for Developing a Long Term Sustainable Iraqi Oil Industry," a report on the Iraqi oil industry favoring foreign participation as the most efficient way of developing the sector.18

March 2004: CPA names new Iraq Oil Advisers: Mike Stinson of ConocoPhillips and Bob Morgan of BP.19

March 2004: Iraq's interim constitution, the Transitional Administrative Law (TAL) passed in March 2004 by Iraq's Governing Council, sets forth that CPA laws, regulations, and orders are to remain in force after the transfer of sovereignty unless a duly enacted piece of legislation rescinds or amends them.20

June 2004: U.S. handover to the Iraq Interim Government. Mike Stinson becomes an adviser to the U.S. Embassy in Baghdad.21 Thamir al-Ghadban is named as Iraqi Oil Minister.

November 2004: International oil companies launched voluntary efforts to train Iraq's oil workers and provide technical assistance, hoping to generate goodwill and eventually get access to the country's huge oil reserves. Companies from the United States, Britain, and Russia—including ChevronTexaco Corp., BP, Royal Dutch/Shell Group, and Lukoil—are paying to send Iraqi oil workers out of the country to teach them the latest techniques in developing and managing oil fields.22

December 22, 2004: Iraqi Finance Minister Mahdi, in a joint press conference with U.S. Undersecretary of State Alan Larson at the National Press Club, announced Iraq's plans for a new petroleum law to open the oil sector to foreign private investment. Mahdi explained, "So I think this is very promising to the American investors and to American enterprise, certainly to oil companies."23

Early 2005: New Government, old oil minister, al-Uloum reappointed to position of Minister for Oil. Ahmed Chalabi, head of the U.S.-backed Iraqi National Congress, was appointed chair of the Energy Council. In 2002, Chalabi said, "U.S. companies will have a big shot at Iraqi oil."24

May 2005: Approximately 30 international oil companies signed Memoranda of Understanding with Iraq, generally for the training of Iraqi staff, consulting work, and studies.25

August 30, 2005: Bush says U.S. troops would continue fighting in Iraq in order to protect the country's vast oil fields, which he said would otherwise fall under the control of terrorist extremists.26

October 15 2005: The national referendum for the Iraqi constitution passes, containing an outline for oil revenue sharing and development.

December 2005: Iraq enters into agreement with the International Monetary Fund committing Iraq to draft a new petroleum law by the end of 2006 to allow foreign investment in the country's oil industry. The arrangement was signed before the new Iraqi government had been appointed and one week after the December 2005 elections thus denying Iraqi voters a chance to react through the ballot box.

February 2006-June 2006: USAID contracts with BearingPoint to draft Iraq's oil law to provide "legal and regulatory advice in drafting the framework of petroleum and other energy-related legislation, including foreign investment."27

March 15, 2006: Gen. John Abizaid, the Army general overseeing U.S. military operations in Iraq, said the United States may want to keep a long-term military presence in Iraq to bolster moderates against extremists in the region and protect the flow of oil.28

May 2006: Iraq's new oil minister, Hussein al-Sharistani, began drafting legislation to govern Iraq's oil sector. Following his appointment, Shahristani announced that one of his top priorities would be to pass a law allowing privatization through parliament by the end of 2006.

July 2006: U.S. Government and oil companies get a copy of the draft oil law.29

September 2006: International Monetary Fund and World Bank receive a copy of draft oil law.30

October 17, 2006: President Bush signs the 2007 Defense Authorization Act (PL No: 109-364) which states in SEC. 1519,"No funds ... in this Act may be obligated or expended ... to exercise United States economic control of the oil resources of Iraq.

February 2007: U.S. Ambassador to Iraq, Zalmay Khalilzad, "has been in intense talks with Kurdish leaders in the north to overcome their objections to the draft. Iraqi officials say Mr. Khalilzad's negotiations were crucial to winning unanimous cabinet approval."31

February 18, 2007: "Draft Hydrocarbon Law" was submitted to the Iraqi Cabinet (Council of Ministers).32

February 26, 2007: "Draft Hydrocarbon Law" was passed by the Iraqi Cabinet and was submitted to the Iraqi Parliament (Council of Representatives).33

April 19, 2007: Defense Secretary Robert Gates travels to Baghdad to push political benchmarks and specifically the oil law.34

May 9 2007: U.S. Vice President Dick Cheney travels to Baghdad to push political benchmarks and specifically the oil law.35

June 12, 2007: U.S. Admiral Fallon, head of the Central Command, warned Iraq's Prime Minister Nouri al-Maliki in a closed-door conversation to pass the oil law by July.36

July 3, 2007: Iraq cabinet approves amended oil law draft and resubmits to the Iraqi Parliament.37

July 12, 2007: The White House released its Initial Benchmark Assessment Report. Benchmark #3, "Enacting and implementing legislation to ensure the equitable distribution of hydrocarbon resources" is found to be not met. The report notes, "The effect of limited progress toward this benchmark has been to reduce the perceived confidence in, and effectiveness of, the Iraqi Government. This does not, however, necessitate a revision to our current plan and strategy, under which we have assigned a high priority to this subject, and the process overall has continued to move forward."38

End Notes

#1 University of Michigan, 14 June 2006, "Iraq attitudes: Survey Documents Big Changes," available at www.umich.edu/news/index.html?Releases/2006/Jun06/r061406a.
#2 In the law pushed by the U.S. administration, just one out of 43 articles mentions revenues: and that simply establishes two bank accounts, and states that the distribution will be determined by a separate law. This separate law was put together as an afterthought in summer 2007—attracting almost no interest from the administration; whilst as the timeline shows, the law providing for long-term contracts with multinational companies was consistently pushed by U.S. officials.
#3 Documents from the Cheney-led National Energy Policy Development Group, available at: www.judicialwatch.org; Larry Everest, "Cheney, Energy, and Iraq Invasion: Supreme Court to Rule on Secrecy," San Francisco Chronicle, March 21, 2004; Michael Schwartz, "The Struggle Over Iraqi Oil," TomDispatch May 8, 2007. Available at: http://www.globalpolicy.org/security/oil/2007/0508struggleiraqioil.htm.
#4 Greg Muttitt, "Crude Designs: The Rip-Off of Iraq's Oil Wealth," Platform, November 2005. Available at: http://www.crudedesigns.org/.
#5 Charley Cray, "About Halliburton," Halliburton Watch, n.d. Available online at: http://www.halliburtonwatch.org/about_hal/energytf.html.
# David Teather, "American to Oversee Iraqi Oil Industry," The Guardian/UK, April 26, 2003.
#7 Greg Palast, "U.S. Secret Plans For Iraq's Oil," BBC News World Edition, March 17, 2005.
#8 Paul Farhi, "The Soothing Sound of Fighting Words," The Washington Post, March 26, 2003.
#9 Mark Rice, "For Iraq's Oil Wealth, Tangled Pipes," The Christian Science Monitor, April 21, 2003.
#10 Neil King Jr., "Bush Officials Draft Broad Plan for Free-Market Economy in Iraq," Wall Street Journal, May 1, 2003.
#11 Colum Lynch, "United States to Propose Broader Control of Iraqi Oil, Funds," The Washington Post, May 9, 2003.
#12 Rajiv Chandrasekaran, "Bremer Broaches Plans for Iraq's Oil Revenue," The Washington Post, June 23, 2003.
#13 James Ridgeway, "The Black Gold Rush: Divvying Up Iraq's Oil," Mother Jones, January 29, 2007.
#14 David Ivanovich, "Houston Exec Gets Top Iraq Energy Post," Houston Chronicle, September 23, 2003.
#15 U.S. Trade and Development Agency, conference agenda, "Iraq Energy Roundtable: Emerging Opportunities in the Iraq Oil and Gas Sector," June, 7, 2006. Available at: http://www.export.gov/iraq/pdf/oilgas_roudtable_060706.pdf.
#16 Joshua Holland, "The U.S. Takeover of Iraqi Oil" AlterNet, October 17, 2006.
#17 Greg Palast, "OPEC on the March: Why Iraq Still Sells its Oil a la Cartel," Harper's Magazine, April 1, 2005.
#18 Muttitt, Crude Designs. Op. cit.
#19 Muttitt, Crude Designs. Op. cit.
#20 CPA, "Law of Administration for the State of Iraq for the Transitional Period, art. 26(c)," March 8, 2004. Available at: http://www.cpa-iraq.org/government/TAL.html (accessed June 22, 2004).
#21 Muttitt, Crude Designs. Op. cit.
#22 Justin Blum, "Big Oil Companies Train Iraqi Workers Free Global Companies Offer Services to Establish Goodwill, Win Business," The Washington Post, November 6, 2004.

Transcript, NPC Afternoon Newsmaker News Conference; see also, Antonia Juhasz, "Iraq's Oil Timeline," Left Turn Magazine , May 1, 2006.
#23 Dan Morgan and David B. Ottaway, "In Iraqi War Scenario, Oil Is Key Issue," The Washington Post, September 15, 2002.
#24 "National Development Strategy 2005-2007," Republic of Iraq, Iraqi Strategic Review Board, Ministry of Planning and Development Cooperation, June 30, 2005.
#25 Jennifer Loven, "Bush Gives New Reason for Iraq War," Associated Press, August 31, 2005.
#26 Benoit Faucon, "USAID Provides Adviser to Iraq Govt on Oil Law—Spokesman," Dow Jones Newswires, April 28, 2006; Greg Muttitt, "George's Oil Dubya-Speak: As Decision-Time Approaches, the USA Pulls Levers on Iraqi Oil Policy," Carbon Web, August 21, 2006.

#27 Vicki Allen, "Abizaid Says United States May Want to Keep Bases in Iraq," Reuters, March 15, 2006.
#28 Raymond Whitaker, Danny Fortson, Andrew Murray-Watson, Geoffrey Lean, and Tim Webb, "Blood and Oil; Special Report: The Spoils of War," The Independent, January 7, 2007.
#29 Raymond Whitaker, Danny Fortson, Andrew Murray-Watson, Geoffrey Lean, and Tim Webb, "Blood and Oil; Special Report: The Spoils of War," The Independent, January 7, 2007.
#30 Edward Wong, "Iraqi Cabinet Approves Draft of Oil Law," The New York Times, February 26, 2007.
#31 Raed Jarrar, "The New Iraqi Oil: Leaked," raedinthemiddle.blogspot.com, February 18, 2007.
#32 Raed Jarrar, "Council of Ministers' Resolution," raedinthemiddle.blogspot.com, March 1, 2007.
#33 David Cloud, Alissa J. Rubin, and Edward Wong, "Gates in Baghdad to Press Iraqis on Reconciliation," International Herald Tribune, April 19, 2007.
#34 John F. Burns, "Cheney Visits Baghdad and Presses Leaders on Political Progress," The New York Times, May 10, 2007.
#35 Michael R. Gordon, "United States Warns Iraq Progress Needs to be Made," The New York Times, June 12, 2007.
#36 "Iraq Cabinet Approves Oil Law Draft," Associated Press, July 3, 2007.
#37 "Initial Benchmark Assessment Report," The White House, July 12, 2007. Available at: http://www.whitehouse.gov/news/releases/2007/07/20070712.html.

And wrap up with this must read Harper's article by the University of Chicago trained economist and now ex-pat American journalist with the BBC. Excerpts below http://tinyurl.com/yp498o

Just what to do with this proxy power has been, almost since President Bush’s first inaugural, the cause of a pitched battle between neoconservatives at the Pentagon, on the one hand, and the State Department and the oil industry, on the other. At issue is whether Iraq will remain a member in good standing of OPEC, upholding production limits and thereby high prices, or a mutinous spoiler that could topple the Arab oligopoly.

According to insiders and to documents obtained from the State Department, the neocons, once in command, are now in full retreat. Iraq’s system of oil production, after a year of failed free-market experimentation, is being re-created almost entirely on the lines originally laid out by Saddam Hussein.
Under the quiet direction of U.S. oil company executives working with the State Department, the Iraqis have discarded the neocon vision of a laissez faire, privatized oil operation in favor of one shackled to quotas set by OPEC, which have been key to the 148% rise in oil prices since the beginning of 2002. This rise is estimated to have cost the U.S. economy 1.5% of its GDP, or a third of its total growth during the period.

Given this economic blow, and given that OPEC states account for 46% of America’s oil imports, it may seem odd that the United States’ “remaking” of Iraq would allow for a national oil company that props up OPEC’s price gouging. And in fact the original scheme for reconstruction, at least the one favored by neoconservatives, was to privatize Iraq’s oil entirely and thereby undermine the oil cartel. One intellectual godfather of this strategy was Ariel Cohen of the Heritage Foundation, who in September 2002 published (with Gerald P. O’Driscoll, Jr.) a post-invasion plan, “The Road to Economic Prosperity for a Post-Saddam Iraq,” that put forward the idea of using Iraq to smash OPEC. Cohen explained to me how such an extraordinary geopolitical feat might be accomplished. OPEC maintains high oil prices by suppressing production through a quota system effectively imposed on each member by Saudi Arabia, which reigns by dint of its overwhelming reserves. The Saudis, to maintain their control on pricing, must keep a lid on production from other members-particularly Iraq, which has the second greatest proven reserves.

Under Saddam Hussein, Iraq adhered to the OPEC quota limit (historically set to equal Iran’s, now 3.96 million barrels a day) via state ownership of all fields. Cohen reasoned that if Iraq’s fields were broken up and sold off, a dozen competing operators would quickly crank up production from their individual patches to the maximum possible, swiftly raising Iraq’s total output to 6 million barrels a day. This extra crude would flood world petroleum markets, OPEC would devolve into mass cheating and overproduction, oil prices would fall over a cliff, and Saudi Arabia-both economically and politically - would fall to its knees.

By February 2003, Cohen’s position had been enshrined as official policy, in the form of a hundred-page blueprint for the occupied nation titled, “Moving the Iraqi Economy from Recovery to Sustainable Growth”-a plan that generally embodied the principles for postwar Iraq favored by Defense Secretary Donald Rumsfeld, Deputy Secretary Paul Wolfowitz, and the Iran-Contra figure Elliott Abrams, now Deputy National Security Adviser. Nominally written by a committee of Defense, State, and Treasury officials, the blueprint was in fact the brainchild of a platoon of corporate lobbyists, chief among them the flattax fanatic Grover Norquist. From overhauling tax rates to rewriting copyright law, the document mapped out a radical makeover of Iraq as a free-market Xanadu-a sort of Chile on the Tigris-including, on page 73, the sell-off of the nation’s crown jewels: “privatization… [of] the oil and supporting industries.”

Following the U.S. military’s swift advance to Baghdad, those skeptical of the neocon plan were summarily brushed aside. Chief among the castoffs was General Jay Garner, the shortlived occupation viceroy who on the very night he arrived in Baghdad from Kuwait received a call from Rumsfeld informing him of his dismissal. When I met with Garner last March at the Washington offices of L3 Corporation’s giant security subsidiary he now heads, the general told me that he had resisted imposing on Iraqis the plan’s sell-off of assets, especially the oil. “That’s just one fight you don’t have to take on right now,” he said. “You don’t want to end the day with more enemies than you started with.”

In plotting the destruction of OPEC, the neocons failed to predict the virulent resistance of insurgent forces: the U.S. oil industry itself. From the outset of the planning for war, U.S. oil executives had thrown in their lot with the pragmatists at the State Department and the National Security Council. Within weeks of the first inaugural, prominent Iraqi expatriates-many with ties to U.S. industry-were invited to secret discussions directed by Pamela Quanrud, an NSC economics expert now employed at State. “It quickly became an oil group,” one participant, Falah Aljibury, told me. Aljibury, an adviser to Amerada Hess’s oil trading arm and to investment banking giant Goldman Sachs, who once served as a back channel between the United States and Iraq during the Reagan and George H. W. Bush administrations, cut ties to the Hussein regime following the invasion of Kuwait.

The working group’s ideas about the war had been far less starry-eyed than those of the neocons. “The petroleum industry, the chemical industry, the banking industry-they’d hoped that Iraq would go for a revolution like in the past and government was shut down for two or three days,” Aljibury told me. “You have a martial law . . . and say Iraq is being liberated and everybody stay where they are . . . Everything as is.” On this plan, Hussein would simply have been replaced by some former Baathist general. One candidate was General Nizar Khazraji, Saddam’s former army chief of staff, who at the time was under house arrest in Denmark pending charges for war crimes. (Khazraji was seen in Iraq a month after the U.S. invasion, but he soon disappeared and has not been heard from since.)

Roughly six months before the invasion, the Bush Administration designated Philip Carroll to advise the Iraqi Oil Ministry once U.S. tanks entered Baghdad. Carroll had been CEO of both Fluor Corporation, now a major contractor in Iraq, and, earlier, of Royal Dutch/Shell’s U.S. division. In May 2003, a month after his arrival in Iraq, Carroll made headlines when he told the Washington Post that Iraq might break with OPEC: “[Iraqis] have from time to time, because of compelling national interest, elected to opt out of the quota system and pursue their own path. . . . They may elect to do that same thing. To me, it’s a very important national question.” Carroll later told me, though, that he personally would not have been supportive of privatizing oil fields. “Nobody in their right mind would have thought of doing that,” he said.

Soon after Carroll resigned his post in September 2003, the new provisional government appointed an oil minister, Ibrahim Bahr al-Uloum. Uloum (who had been maneuvered into the job by then-neocon favorite Ahmad Chalabi) quickly fired Muhammad al-Jiburi, chief of Iraq’s State Oil Marketing Organization, and Thamer Ghadhban, the expert in charge of the southern oil fields, both of whom had been trusted by the Western oil industry. Production faltered from a combination of incompetence, wholesale theft (Iraq’s oil was unmetered), sabotage, and corruption that one oilman told me was “rampant,” with “direct payoffs to government officials by commercial operators.”

With pipelines exploding daily, the fantasy of remaking Iraq’s oil industry also went up in flames. Carroll was replaced by another Houston oil chieftain, Rob McKee, a former executive vice-president of ConocoPhillips and currently the chairman-even during his tenure in Baghdad-of Enventure, an oil-drilling supply subsidiary of the Halliburton Corporation. McKee had little tolerance for the neocons’ threat to privatize the oil fields. A close associate of McKee’s and the executive adviser to Hess’s trading arm, Ed Morse, told me that “Rob was very promotive of putting in place a really strong national oil company,” even if he had to act over the objections of the Iraqi Governing Council. Morse, who says he takes as many as six calls a day from the Bush Administration regarding Iraq, is one of the men to whom Washington turns to obtain the views of Big Oil. Like Carroll and McKee, Morse sneers at what he calls “the obsession of neo-conservative writers on ways to undermine OPEC.” Iraqis, says Morse, know that if they pump 6 million barrels a day, i.e., 2 million above their expected OPEC quota, “they will crash the oil market” and bring down their own economy.

In November 2003, McKee quietly ordered up a new plan for Iraq’s oil. The drafting would be overseen by a “senior adviser,” Amy Jaffe, who had worked for Morse when he held the formidable title of Chairman of the Council on Foreign Relations-James Baker III Institute Joint Committee on Petroleum Security. Jaffe now works for Baker, the former Secretary of State, whose law firm serves as counsel to both ExxonMobil and the defense minister of Saudi Arabia. The plan, nominally written by State Department contractor BearingPoint, was guided, says Jaffe, by a handful of oil industry consultants and executives.

For months, the State Department officially denied the existence of this 323-page plan for Iraq’s oil, but when I identified the document’s title from my sources and threatened legal action, I was able to obtain the complete report, dated December 2003 and entitled “Options for Developing a Long Term Sustainable Iraqi Oil Industry.” The multi-volume document describes seven possible models of oil production for Iraq, each one merely a different flavor of a single option: the creation of a state-owned oil company. The seven options ranged from the Saudi Aramco model, in which the government owns the whole operation from reserves to pipelines, to the Azerbaijan model, in which the state-owned assets are operated almost entirely by “IOCs” (International Oil Companies). The drafters had little regard for the “self-financing” system, such as Saudi Arabia’s, which bars IOCs from the fields; they prefer the production-sharing agreement (PSA) model, under which the state maintains official title to the reserves but operation and control are given to foreign oil companies. These companies then manage, fund, and equip crude extraction in exchange for a percentage of sales receipts.

While promoting IOC control of the fields, the authors take care to warn the Iraqi government against attempting to squeeze IOC profits: “Countries that do not offer risk-adjusted rates of return equal to or above other nations will be unlikely to achieve significant levels of investment, regardless of the richness of their geology.” Indeed, to outbid other nations for Big Oil’s favor will require Iraq to turn over quite a large share of profits, especially when competing against countries such as Azerbaijan that have given away the store. The Azeri government, notes the report, has “been able to partially overcome their risk profile and attract billions of dollars of investment by offering a contractual balance of commercial interests within the risk contract.” This refers to the fact that Azerbaijan, despite its poor oil quality and poor location, drew in the IOCs via scandalous splits of revenue allowed by the nation’s corrupt government.

Given how easily the interests of OPEC and those of the IOCs can be aligned, it is certainly understandable why smashing the oil cartel would not strike oilmen as a good idea. In 2004, with oil approaching the $50-a-barrel mark all year, the major U.S. oil companies posted record or near record profits. ConocoPhillips, Rob McKee’s company, this February reported a doubling of its quarterly profits from the previous year, which itself had been a company record; Carroll’s former employer, Shell, posted a record-breaking $4.48 billion in fourth-quarter earnings. ExxonMobil last year reported the largest one-year operating profit of any corporation in U.S. history.

When I talked to Ariel Cohen at Heritage, his dream of smashing OPEC in shambles, he blamed the State Department for acquiescing to the Saudis and to Russia, which also benefit s from selling oil at high OPEC prices. The poisonous policies were influenced, he said, by “Arab economists hired by the State Department who are basically supporting the witches’ brew of the Saudi royal family and the Soviet ostblock . . . because the Saudis are interested in maximizing their market share and they’re not interested in fast growth of the Iraqi output.”

According to Morse, the switch to an OPEC-friendly policy for Iraq was driven by Dick Cheney himself. “The person who is most influential in running American energy policy is the Vice President,” who, says Morse, “thinks that security begins by . . . letting prices follow wherever they may.”

Even, I asked, if those are artificially high prices, set by OPEC? “The VP’s office [has] not pursued a policy in Iraq that would lead to a rapid opening of the Iraqi energy sector . . . so they have not done anything, either with producers or energy policy, that would put us on a track to say, ‘We’re going to put a squeeze on OPEC.’”

Opposition to Iraq’s membership in OPEC was handled in a style that would have made Saddam proud. On May 20, 2004, Iraqi police raided Ahmad Chalabi’s home in Baghdad and carted away his computers and files. Chalabi was hunted by his own government: the charge was espionage, no less, for Iran. Chalabi’s Governing Council was soon shut down and, crucially, Bahr al-Uloum was yanked from the Oil Ministry and replaced by the very men he had removed: Thamer Ghadhban took al-Uloum’s job at the oil ministry and Chalabi rival Muhammad al-Jiburi was made minister of trade.

But just when you thought the fat lady sang for the neo-cons, who should rise from his crypt eight months later but Ahmad Chalabi. In January 2005, Chalabi cut a deal with his former oil minister al-Uloum’s father, a Shia power broker, and rode that religious ethnic vote back into office. Chalabi landed himself the post of Second Deputy Prime Minister and, in addition, the tantalizing title of Interim Oil Minister. The espionage investigation was dropped; the King of Jordan offered to pardon Chalabi for the $72 million missing from Chalabi’s former bank; and Chalabi once again turned over his oil ministry to al-Uloum, the sheik’s son. The Texans’ pro-OPEC man Ghadhban was again kicked downstairs.

But Chalabi had learned his lesson: don’t mess with Texas, or the Texan’s favorite cartel. A chastened Chalabi now endorses Iraq’s cooperation with OPEC’s fleecing of the planet’s oil consumers.

Meatball One said...

Whoops, I hope I didn't leave the impression that the denizens of SMC, in our humble opinion, think we invaded Iraq because of oil.That would be retarded to say the least. Iraq was in an untenable holding pattern before the invasion and something had to be done about it sooner or later. I'll leave it at that, Adrian.

Anonymous said...

"It’s kind of interesting that these reports do not elicit any reflection on the reasons why we invaded Iraq. You’ve heard those reasons offered, but they were dismissed with ridicule. Now they’re openly conceded to be accurate, but not eliciting any retraction or even any reflection."
I think it is SUPER interesting. If I was 'dismissed with ridicule', I'd be on this news like a box of jelly donuts and spread it like there was no tomorrow, regardless of auxiliary effects or bridges burned.
So have we all reached culmination regarding oil/ Iraq/ Middle Eastern issues? Perhaps. There are a grip of Joe Q Publics, the “responsible electorate”, that think AQ, the Taliban, Iraq, Afghanistan, 9/11 etc etc etc- are one issue.
And sooner or later, bad guys have to be deposed.
Nonetheless, are we really surprised that America, in its strategic wisdom, realizes that economics/ energy/ oil is key in maintaining its position as global hegemon?(Whether or not you believe this is a unipolar or multipolar world can be debated- we're still one of the big dogs and need to secure resources...) I think the interesting question would be- do the Powers That Be really think a piece of paper effects/ controls who sells oil to who out of Barsrah? Infrastructure…infrastructure- the oil pipelines, etc are in need of MAJOR repair and maintenance, there is limited control/ recording of who is taking what where (Iraqi record keeping has never been specifically a strong point)- and don't get me started on the smuggling/ trade routes that pre-existed the state of Iraq, that were made more robust through the Oil For Food program, and still exist. BLUF: we can sign all the paper we want to secure the oil for our use. Fact of the matter is, we need the military to make sure the infrastructure is protected and the oil gets delivered to where it is supposed to be delivered...

theBhc said...

why wouldn't we have just bought it from Saddam? He was more than willing to sell to anyone he could.

The Big Meat has more the amply demonstrated just what is at stake in Iraq. The question is not whether we could buy it (though the sight of US Big Oil brokering deals with Hussein and having to buy Iraqi oil with Euros would certainly have been a hoot!), but rather who else could and likely would buy it.

Given Hussein's distaste for having been fucked over by the Yanks for decades, after having been an admittedly self-serving yet somewhat loyal CIA asset, he was far more partial to dealing with Russia and China than with US oil agents, even though several were caught in the Oil-for-food scandal (never let it be said that Hussein would elevate principle above a good bribe). One in particular goes by the name Chevron and was doing the dirty deeds while none other than Condi Rice sat on the Board and headed that firm's public relations efforts (Last year, Chevron settled out of court for $25 million, but most of the media missed that because Paris Hilton was going to jail at the time.)

Indeed, as we have oft heard, the Russians and the Chinese were fearful that previous contracts would be made null and void by the puppet regime, which, at least in part, has played out. LUKOil had a rather large contract with Hussein's government for work in one of the largest oil fields in Iraq and which was recently voided by the Iraq cabinet. There is still wrangling about that, just as Putin makes warm overtures to Baghdad.

This appears to be Put -- er, Gazprom's and CNOC's strategy around the globe: argue that the Americans have been screwing you (which they have) and promise a more equitable arrangement over energy resources. This is now going on in Niger and elsewhere And if anyone has been screwed over by the Yanks, surely the Iraqis have been. The play here is coming from the fact that Russia and especially China are not interested in oil for oil profit sake; the Chinese simply need it to fuel their growth engine. Whereas for the Americans, oil is as much about energy security as it is about the massive profits. The Chinese can afford to be equitable with the source because they make their money in other venues, like building stuff, something we have long forsaken.

This was and continues to be the fear in Washington. But the timeline is, in fact, reversed. It was the unilateral agenda of invasion that now has propelled Russia and China into positions that have been orchestrated by US run-away deficit spending and the high price of oil. The neo-con agenda of global hegemony, secured by tight control of oil supplies has produced just the opposite effect. Which, for them, means that the military machine is now the only possible way to enforce compliance with American interests. And I think we can all agree that that strategy has a very short shelf life.

theBhc said...

Meat,

I also wanted to say, nice article and to further point you (in case you have not seen it) to the latest by Nir Rosen.

The Myth of the Surge.

The military or at least the grunts seem to know that this Sunni "Awakening" and US funding for it is a disaster in waiting. It'll be an awakening, alright, but not in the way it is commonly understood over here.

Further more, the number of Iraqis devastated by this debacle is way undercounted as reported by people who have actually been there. I recently heard Dahr Jamail speak and he relayed that UN officials agree that the 5 million (refugees and IDPs) displaced Iraqis is well short of the real number. More like 6-8 million. Plus a million dead, plus another 5 million suffering malnourishment and food insecurity -- many of them children -- who also now suffer as orphans (yes, 5 million orphans). This puts the number of disposed and afflicted at about 50% of the population. And of those professionals left in the country, the women are now being systematically eradicated for being "un-Islamic." Hundreds of women are turning up in dead in Basra, where the Brits tucked tail and hid. It is the Shiite militias funded by the US that are now carrying out this pogrom.

The situation is beyond grim. And I am not entirely convinced that it wasn't supposed to turn out this way.

Meatball One said...

Anon - good points imho. You're tangential to hyper-essentials I sometime bore my blog buddy Mountain Runner with. I'll suffice reply at that anorectic state for the time being. The thangs u say get me going in replicatin' ways that contradict my present lazy state. Lazy wins tonight.

Keep it comin'.

Meatball One said...

thebhc

NASA-man (aka Star-dude), you gotta stop calling me Meat - it riles me up sum'ting awful. ('Tis but Matt that gets to call me that)

That out of the way - thanks for the link. Our super scanners missed the piece.

The revisionist factuals of your comment have me forgiving your corduroyed ass for being the gender-traitoring Code Pink hetero-vegan aubergine-BBQ & Kool-Aid event coordinator your mama lamented you were - and jealously remain.

(Thank goodness for your and whiny Cindy's sake I still owe you twelve odd Canuckian bucks, eh?)

theBhc said...

I'm not entirely sure what the hell you are saying there, but I will stop calling you Meat, reserved as it appears to be for a certain someone.