>> NOW THEY TELL US...

Skeleton in Clarke's closet
By Boston Herald editorial staff
Thursday, March 25, 2004
Former counterterrorism official and now tell-all author Richard Clarke was at it again yesterday, scorching Bush administration officials in testimony before the national Sept. 11 commission.
We'd like to know how Clarke squares his contention that he was the only one in the Bush administration truly committed to thwarting terrorism before the Sept. 11 attacks with this: It was Clarke who personally authorized the evacuation by private plane of dozens of Saudi citizens, including many members of Osama bin Laden's own family, in the days immediately following Sept. 11.
Clarke's role was revealed in an October 2003 Vanity Fair article. ``Somebody brought to us for approval the decision to let an airplane filled with Saudis, including members of the bin Laden family, leave the country,'' Clarke told Vanity Fair. ``My role was to say that it can't happen unless the FBI approves it. . . And they came back and said yes, it was fine with them. So we said `Fine, let it happen.' ''
Vanity Fair uncovered that the FBI never fully investigated the passengers on those privately chartered flights (one of which flew out of Logan International Airport after scooping up a dozen or so bin Laden relatives.) But Clarke protested to Vanity Fair that policing the FBI was not in his job description.
Isn't that convenient?
The same sanctimonious Clarke who now claims National Security adviser Condoleezza Rice didn't even know what al-Qaeda was, could have stopped the bin Laden airlift singlehandedly.
Why didn't he appeal to Rice, or even President Bush [related, bio] himself in one of those one-on-ones in the Situation Room, to block the flights? Surely it would have been helpful to determine - without a shred of doubt - that those passengers knew nothing about the Sept. 11 plot or the modus operandi of their notorious relative.
By all accounts, Clarke made hundreds of decisions in the days after Sept. 11, many clear-headed and right.
Approving those special flights seems like a wrong one, but it was a judgment call made in the aftermath of the worst terrorist attack on U.S. soil in history.
Perhaps it was the best decision he could make under the circumstances. It's too bad Clarke cuts no one in the Bush administration the same slack he so easily cuts himself.


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Conspiracy (A theory)
http://www.haaretz.com/hasen/spages/408750.html
By Doron Rosenblum
How did the State of Israel, once one of the most promising, riveting and admired countries in the world, plunge from the heights of promise and hope into the depths of despair, bereavement and failure? What caused a country where, everyone agrees, there are intelligent people - and in any event, human material of equal caliber to that of any other country - to deteriorate, willingly and with full awareness, down the slope of the sewage of history? What made it become, gradually but systematically, one of the most hated, most isolated and most miserable places to be on the planet? Why did a country that was established as a "refuge" and a "haven" turn into a trap in which the routine of life has become a routine of death and which is defined, according to the findings of a comprehensive public opinion survey, as "the country most dangerous to peace in the world"?
These questions have been contemplated for the past three years from every possible angle in an effort to understand and explain why, in this period especially, hardly any step taken by the government of Israel improves the country's lot or turns out to be useful. Why is the country striding along on a march of folly which has seen few precedents in human history? Why is it being swept from one idiotic decision to another? Why does it repeatedly act in explicit contradiction to the interests of its inhabitants?
In these past three years in particular, there is no mine that Israel has failed to step on, no opportunity it hasn't missed, no path it hasn't embarked on in the certain knowledge that it will be harmful.
Following the liquidation of Sheikh Ahmed Yassin this week, for example, one commentator informed us that "the security bodies are deploying for what is known as damage assessment" (!) in the wake of the act they decided on. The defense minister explained that the "wave of hits" was intended to meet the "wave of escalation in terrorist attacks that will follow in its wake." He thus made it clear what underlies this series of decisions, which can be called "cost-damage" (as opposed to "cost-benefit"). They seem not to be driven by clear and rational considerations of benefit but by vague and uncontrollable "planning" impulses, accompanied by a silent prayer that it will be possible to contain their damage. It's like someone who is mentally ill and takes into account his own attacks of madness, and deploys to absorb them.
The attempt to explain rationally and conventionally the dynamics at work here has long since failed. So much so, in fact, that the only explanation the political and military analysts on television could come up with this week was: "They're doing XXX and hoping something good will come of it."
Is there any other way to explain the deliberate escalations that have only intensified the waves of terrorism, the crushing of the Palestinian Authority (followed by the crocodile tears over the "anarchy that has been created" without the PA), the foolish "deals" that only strengthened Hezbollah, the hasty, hot-headed military operations, executed with the total abandonment of the security of the country's citizens? Or the fact that "at the end of the day" (as they like to say in the army), every day is worse than the one before, every year is harder than the last?
What's going on here? What's behind it?
Some will say that there is method to the madness: It's all a brilliant Machiavellian ploy by Messrs. Sharon & Mofaz to preserve the true apple of their eye - the settlements - even if the world turns topsy-turvy. Others will say that it's all inertia, the work of lowbrow generals who don't know any other way. There's nothing of genius here, just stupidity. Still others will put it down to shehur, witchcraft, the evil eye. It's just that our luck has turned around, you see, because from a certain stage the slice of bread always falls with the buttered side down. Some will say: we have found ourselves dastardly enemies - irrational, murderous, lacking the ability to compromise, without creativity or flexibility, and that their madness has somehow clung to us.
There is no explanation that hasn't been heard in the past three years, apart from one: conspiracy.
Maybe there's a mole.
Yes, a mole. A kind of planted spy - a destructive worm virus, a Trojan horse.
Let's put it this way: We have here a march of folly that is so systematic, so consecutive and so determined that there's no way it's happening by itself. Because if it were accidental, wouldn't there have to be the occasional random success as well? So maybe it's really not accidental. Maybe there's someone who's running the show - craftily, brilliantly.
Who is it? That's not clear. But that's the whole point. We don't know and we don't suspect. But maybe he's sitting there, way up at the top of the decision-making process, deeply dug in: an impeccable fellow, supposedly, above all suspicion; known even as a fervid patriot, ostensibly - preferably of the type who has gone through all the stages of Israeli involvement since his youth, including an impressive military career.
"Decent," seemingly, and even "simple-minded" outwardly, driven purportedly by passion and wrath, he succeeds in tapping brilliantly into all the psychoses and paranoias of the Israelis and in making them follow blindly his proposals, recommendations and decisions - however loony and harmful they may be. The motive is one: to cause, within the shortest possible time, the greatest and longest-lasting damage.
Let's say violence springs up on the Palestinian side - stone-throwing, roadblocks, firebombs. Our friend coils himself for action: here's a great chance to drag Israel into a "policy of escalation." Why shouldn't it cut off its nose to spite its face?
The tanks are already rolling, shells are flying, casualties are falling, the blood stirs up the passions. And when buses start to explode there is no longer anyone to stop the targeted liquidations. In fact, they're so targeted that they will cause Israel its most severe image damage: there's always a kid who gets killed, or a pregnant woman, and always, somehow, just as the cameras are rolling.
If it's proved beyond any doubt that these "targeted" assassinations also summon up horrific revenge attacks, worse than anything we have known, our friend will see to it that the idea is adopted and turned into permanent policy; and not only that, he will also see to its implementation - like pouring oil on the flames - whenever some sort of calm looms, some kind of respite, even if only because of mutual exhaustion. When it appears, for a moment, that the sides have already fought themselves silly, like two punch-drunk boxers, our malicious friend starts to get worried. Why should the stock market be bullish? Why should shoppers go back to the malls? Why should nature lovers take up hiking again? Why give some political process a chance? Right off he will douse them with a pail of water and get them back into action, for another round. Good morning, targeted assassination! Good morning, Israel! Good morning, Zaka! Good morning, red alerts!
Endlessly creative, our molish buddy will propose trapping Israel so that it will not emerge well from any situation. It will always fall over some tripwire that it has prepared itself in advance: "no" to the building of a fence until the number of dead soars into the hundreds; "yes" to a fence only along a route that generates international protest; "no" to Abu Mazen and to negotiations with the most moderate elements; "yes" to Nasrallah and to gestures and deals with the most extreme element. In the wake of appalling terrorist attacks against women and children, he will suggest a "moderate response," of all things, and that we build ourselves up from the feeling of victimization; following semi-legitimate guerrilla attacks on the army and on strategic targets he will propose that we "go ape"; give the option of negotiations in return for concessions and withdrawals in return for eternal war, he will opt for the latter. And so on and so forth. The sky's the limit.
At every stage, our friend will ask himself: How else can I be harmful? What haven't I done yet? What extra dimension can I inject into the conflict? What new layer can be added to it? We succeeded in elevating the conflict from a territorial dispute into a war of chaos involving decentralized communities and organizations. Well done, yes, but now it's time to elevate it to the religious plane, the apocalyptic level, so that the damage will extend not only into the next generation, but for untold generations down the line.
Our friend looks around and asks himself: What single action can I take in order to place Israel at the cutting edge in the war of civilizations against the whole of Islam? How can I upgrade the existential threats: from mere bombs and shooting by local ragamuffin groups to the gunsights of Al-Qaida? And how can I, by the same twist of the blade, cause the most effective publicity damage? His eye catches sight of the most adored religious leader, who is also old, sick and crippled. And the rest is the un-end of history: today the war of Gog and Magog; tomorrow the Apocalypse.
The holidays are approaching. Pleasant azure skies above, a dry desert wind, flowers blooming across the land. A moment of quiet. The economy is showing a bit of improvement. The fingers of our friend are beginning to itch. Then a brain wave: he goes over to the beehive and kicks it as hard as he can. A vast swarm of bees hides the light of the sun. And, as a morale boosting bonus, he also makes sure to inform the public that in his view, the war will go on for 20 years at least (without deducting the past three years).
And again he looks around: what else, what else ... A mischievous glint in his eye: the Temple Mount?
Hey, that's an idea, too ...
Who's the mole? And furthermore: why is he doing it? In whose service is he operating? A messianic organization? Spectra? Smersh? The cult of the devil? The angels of hell? One might think he's working in the service of the Palestinians, were it not for the suspicion that an equally malicious mole is operating at their highest levels, too, and is constantly undermining their best interests.
So, who is he? And, above all, what's his motive? What's he after? It's not clear. It might all really be just an unfounded theory, a ridiculous thesis with no foundation of any kind. But tell me, in the light of what's going on, does anyone have a better explanation?
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Where a foreign passport and an American accent don't help
By Daphna Berman
Students from the U.S. often think police here are too involved with terror to deal with drugs - until they get caught and thrown in jail.
When Yaakov came to study in a Jerusalem yeshiva for a year, he never thought he would spend 10 months in an Israeli prison. Neither did Michael, a yeshiva student from California, or Sarah, a seminary student from New York. But that didn't prevent the three American teens from being arrested and thrown in the Israeli prison system - a place, they soon discovered, where a foreign passport and an American accent didn't come to their rescue. "I never thought I would get caught," Sarah, a petite blond who doesn't look a day over 15 told Anglo File this week. "It always seemed like the police and the IDF were using their intelligence to bust Hamas, not a bunch of American kids."
Israel, she says, seemed to be a giant playground without rule, law, or consequence - a place where it was acceptable to smuggle drugs over international borders. According to Caryn Green, a social worker who deals with English-speaking teens in Jerusalem, many of the North American yeshiva students who get caught in the world of Israeli drug smuggling think that crime here is somehow safer than back home. "The streets look different, the police look different, and kids don't really think of it all as real," she explains. "Drinking rules are more lenient, which gives the impression that everything is more lenient, and so the environment makes them feel less vulnerable."
Many of the kids have abandoned an Orthodox lifestyle, and as one former drug dealer from Jerusalem added, "you've already defied God, which is the ultimate rule of any Orthodox kid - after that, drugs don't seem to bad."
As director of Crossroads, an organization for troubled Anglo youth located off Jerusalem's Zion Square, Green deals with kids who "get picked up all the time" for drug-related interrogations. In the three years since she founded the organization, nine teenagers from abroad have been sentenced to prison terms, four of whom were arrested at Ben-Gurion International Airport for drug smuggling. And although most of these yeshiva students have used or abused drugs before they arrived in Israel, the run-in with the police here, she says, is usually their first.
Spoiled princess
Sarah first smoked marijuana on her 13th birthday, and began dealing drugs two years later. But as the daughter of a wealthy New York businessman who describes herself as a "spoiled little princess," she says she was never motivated by a desire for added income. She helped friends deal as well, but she never asked for commission or her fair share of the profit. "I didn't want money, and I didn't need money," the 20-year-old said this week. "It was always about fun."
Still, it wasn't until Sarah arrived in Israel that she began to smuggle drugs internationally. In December of 2003, the young seminary student traveled to Amsterdam with some friends, who were also yeshiva students; her parents knew where she was going, but decided they didn't want to know why. Three months later, the apartment she was living in was raided: Sarah was arrested, along with Yaakov, and four other American teenagers. "I called my parents and expected to be out in 24 hours," she recalls. "That's the way it was for most of my life - if I got caught smoking in school, they couldn't do anything to me because my parents funded the school. I just figured my parents could sort this out."
After hours of interrogation, hunger, cocaine withdrawal, and a night spent in a holding cell in Jerusalem's Russian Compound, Sarah realized that neither her American citizenship nor her parents' money could come to her rescue. She remained in the holding cell for a month, and was then transferred to Neveh Tirza prison for women in Ramle, where she remained for another two weeks with an American friend, also there on drug-related charges. But Sarah was, by her own estimations, relatively lucky.
The guards at the prison, she says, felt bad for her and gave her preferential treatment-partially because she didn't speak Hebrew, but also because she has the pretty innocence of a young girl. In the Russian Compound, she was allowed to bring in a television, and in Neveh Tirza, her father would bring food from the outside for Shabbat, despite prison regulations. "My time in jail was pretty cushy," she admits. "I think they were also afraid of putting us with Israelis."
In many ways, though, Sarah's experience was atypical of North American yeshiva students who have run-ins with the Israeli penal system. She had the luxury of hiring a private attorney that her friend Yaakov, who was arrested the same day, did not, and says that as an innocent looking female, she was given leniencies her male friends were denied. Most nights in Neveh Tirza, she watched MTV with one of prison guards. After a month-and-a-half of incarceration, Sarah was released to nine months of drug rehabilitation, which she has since completed. She's now finishing her obligatory community service at a Jerusalem soup kitchen.
A god on the streets
Yaakov, like Sarah, was no newcomer to the drug scene when he left his home in Brooklyn to study in a Jerusalem yeshiva three years ago. Over the course of two years, he traveled to Amsterdam three times, personally smuggling between 12 to 14 kilograms of high quality marijuana, estimated at NIS 2 million. He had several people selling and smuggling drugs for him during that period as well, and was by his own estimates, a king in the English-speaking downtown Jerusalem crowd. "It starts as an easy way to make money, but it turns into a life style where people are always looking for you, needing you, and looking to get drugs from you," Green explains.
Being "a god on the streets," she adds, becomes addictive. The police arrested Yaakov in January 2003 - five days after his last and final trip to Amsterdam, and a week before his 18th birthday. "I thought I was invincible," he recalled this week on the telephone from his apartment in Brooklyn. "I kept thinking, `you can't touch me, I'm an American.' But after a few days, I realized they could touch me."
He says he was beaten, interrogated and deprived of a lawyer. At the age of 18, Yaakov was sentenced to 15 months in the Israeli prison system, 10 of which he served. "Prison was like a Third world country," he says. "People were piled into rooms, there were mice running around, bed bugs, mosquitoes, and during the summer, it was hot as hell." He says he got used to prison life quickly, learned to speak Hebrew "the hard way," and gained a reputation as "the crazy American."
Michael, meanwhile, joined him in prison soon after, and though the two yeshiva students knew each other only in passing before their incarceration, they became quick friends. They took cold showers in the winter, slept through the stifling Be'er Sheva heat in the summer, and though they were allowed visitors twice a month, Michael refused. "The visiting room was gruesome - it was like a cage - and I didn't want anyone to come down to see me," he said this week, also from his apartment in New York.
Michael is hesitant to provide details of his drug-dealing past over the phone, but admits, like Sarah and Yaakov, to have traveled to Amsterdam with friends to bring back mass quantities of drugs. "I would never have done this in the U.S., but Israel just seemed like it was Mardi Gras every day," he says. Michael was also 18 at the time of his imprisonment, and he served nine months in prison. He spent his days reading, "getting a little more knowledge, and learning not to make the same stupid mistakes again."
Michael is now a college student with hopes of becoming a lawyer. "Prison showed me a different world," he says. "It showed me a world with consequences."


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Revived to die another day?
Mar 26th 2004
From The Economist Global Agenda
European Union leaders have relaunched their plan to give the EU a written constitution, which had looked doomed after the collapse of talks last December. The leaders now seem ready to compromise but what about their voters and parliaments?
"TWELVE weeks to stop Euro superstate", screamed Britain's Europhobic tabloid Sun this week, reporting that European Union leaders--led by the nefarious, cheese-eating President Jacques Chirac of France--had revived their proposals for a written EU constitution and were aiming to get it agreed by June. To the horror of those opposed to "Ever closer union", the constitution would among other things extend the Union's powers and remove national governments' vetoes in many areas. It would also give the EU a full-time president and foreign minister and introduce a charter of fundamental rights.
Talks on the proposed constitution collapsed last December, when the then holder of the EU's rotating presidency--Italy's prime minister, Silvio Berlusconi--failed to resolve big differences over such issues as member countries' voting strengths. After this, it looked like the constitution would not be revived for years. However, now that the capable and diplomatic Irish prime minister, Bertie Ahern, has taken over the EU presidency from the inept and abrasive Mr Berlusconi, the draft constitution has been fished out of the bin and compromise is in the air. In a summit in Brussels on Thursday March 25th, dominated by discussion of anti-terrorism measures (see article), the leaders of the 15 current EU member states and the 10 countries that will join in May committed themselves to agreeing on a final text for the constitution by their next summit on June 17th and 18th.
One of the main objectives of the constitution is to rationalise the EU's voting arrangements so that, as it expands to 25 members and eventually more, it does not suffer near-permanent stalemate. The draft discussed in December included a new, "double majority" voting system in which most measures would be approved if a numerical majority of EU countries voted for them; and if those countries' combined populations were at least 60% of the EU's total. But Poland and Spain insisted on keeping the voting scheme agreed at the Nice summit in 2000, in which each gets almost as many votes as Germany despite having only around half its population. The smaller countries feared that the new voting system would allow the three largest EU members, Germany, France and Britain, to dominate the rest. Now, a compromise is being floated, which among other things would force the big three to win the backing of at least two other countries to block any proposed law. To pass, a law would need the votes of countries representing perhaps 64% of the EU population. And the new voting system would be delayed for a number of years.
There are several reasons, besides Mr Ahern's quiet diplomacy, why the constitution has been revived so soon after it had seemed lost. In the wake of the Madrid bombings, EU leaders have been keen to display their unity. The unexpected victory of the Socialists in Spain's general election, a few days after the bombings, brought to power a new government that is more willing to compromise on voting arrangements--and keen to align itself diplomatically with France and Germany, rather than Britain and America, as the previous, conservative government did.
Some people in France and Germany had seen the collapse of the constitutional talks as an opportunity to push ahead with forming an "inner core" of EU countries that would pursue faster, deeper integration. But, the more they have thought about this, the clearer it has become that there is little of substance that such a core group could achieve. Some proposals, such as unifying their criminal-justice systems, present huge challenges. And anyway, the existing EU treaties limit the ability of any group of countries to push ahead without the others. So they have turned their attention back to reaching agreement on the constitution.
Faced with being the only one still resisting an agreement, Poland's prime minister, Leszek Miller, had begun in recent days to signal his readiness to compromise. But while Mr Miller sat at the summit table on Thursday night, a group of parliamentarians from his Democratic Left Alliance (SLD) met in Warsaw and agreed to break away and form a new party. On returning home, Mr Miller, who has become deeply unpopular as a result of corruption scandals, bungled health reforms and Poland's 20% unemployment rate, announced his resignation (see article). Even if his replacement is equally willing to compromise over the EU's voting arrangements, the Polish parliament and people may not be. The parliament has already passed a motion rejecting anything other than the Nice voting rules. If Poland holds a referendum on the EU constitution, as Mr Miller has suggested it might, the answer might well be Nie.
Mr Chirac has raised the possibility of France holding a referendum to ratify the EU constitution but is now backing off, realising his compatriots might also say Non. And Britain's prime minister, Tony Blair, is under strong pressure from the opposition Conservatives and the Eurosceptic British press to call a referendum. If he continues to resist this, he will only boost the fortunes of the Eurosceptic opposition leader, Michael Howard, ahead of an election expected next year. At last December's summit, shortly before the talks collapsed, Mr Blair won acceptance of his demand that member countries keep their vetoes on such issues as tax, social security and judicial co-operation. However, in the revived talks he will have to fight for them all over again--and if he does not win back all these concessions, the press, parliament and public will give him hell.
Since the constitution only takes effect if it is ratified by all 25 countries, there is a strong chance that, despite the EU leaders' willingness to compromise, it will fail to get through. In one respect, this would be a shame: the new voting arrangements make sense, as does the idea of giving the Union a fundamental charter outlining its powers, in place of the current hotch-potch of treaties. However, the draft constitution that EU leaders have been discussing, drawn up by a 105-member European Convention, is a terrible mess. It is so hard to understand that even the convention's members struggle to explain it. Whereas it ought to have strengthened the principle of "subsidiarity" (devolving decision-making so it is as close to the people as possible), it does the opposite--making everything subordinate to the Union's objectives, which include various types of "cohesion" (read: Brussels-led harmonisation).
If the citizens of one or other part of Europe send the constitution back to the bin, the EU might be forced to come back with a simpler, more sensible version a few years from now, when its new members have had time to settle in and any problems of an enlarged Union will have had time to emerge. This would be no bad thing.
Copyright ? 2004 The Economist Newspaper and The Economist Group. All rights reserved.



Saudi Arabia
The limits of reform
Mar 25th 2004 | CAIRO
From The Economist print edition
Why six Saudi liberals are in jail, despite talk of change
AFP
The chief mufti squeezes the crown prince
Get article background
IF YOU thought that change was coming soon to Saudi Arabia, think again. Consider the six prominent Saudi liberals who have spent the past week in jail. Their crime is that, unlike seven colleagues arrested at the same time but freed soon afterwards, these recalcitrants refused to pledge that they will stop pestering the country's rulers to reform.
There are other countries where simply asking politely for more rights--in this case, by signing several petitions--can land you in prison. But Saudi Arabia had lately shed some of its aura of arch-autocracy. A mix of pressures--home-grown terrorism, criticism from abroad, and the general restlessness of their mostly youthful subjects--appeared to have awakened Saudi princes to the incongruity of running a large, modern state like a family ranch. The past few years have seen the start of a wide-ranging dialogue, in the press and in government-sponsored forums, to find ways to devolve at least a measure of power to commoners.
Tensions were bound to emerge, particularly in the absence of any elected assembly to air differences or frame a legislative agenda. Reform-minded citizens took to probing, to see just how far the establishment, which in Saudi Arabia means the 10,000-odd princes of the al-Saud family and their pampered traditional allies, the Wahhabi clerical hierarchy, would let them go. They soon encountered red lines. In the past year, for example, half a dozen newspaper columnists have lost their jobs for suggesting such things as abolishing the religious police, allowing women to drive cars, and opening the national budget to public scrutiny.
But a strong popular backlash against religious extremism following recent terror attacks, and the tacit backing of some senior princes, had lately encouraged the kingdom's normally quiescent liberals to further boldness. Despite warnings from the authorities, one group of them had the temerity to prepare yet another petition, demanding the right to set up a human-rights commission. (The government recently licensed an ostensibly independent body to monitor human rights, but most of its members are state employees.)
These are the men, most of them academics, now in jail. But their fate is not the only signal that hard-line princes are losing patience. The minister of defence and second-in-line to the throne, Prince Sultan, this week dismissed any idea that the Shura Council, an appointed body that vets laws, might become an elected legislature, on the ground that illiterate people might be voted in. For his part, the chief mufti of the kingdom, Sheikh Abdel Aziz al-Sheikh, declared that liberals were as much of a danger as militant religious extremists. "Those who doubt the nation and its leadership and its faith are the true enemies, whether or not they claim to call for reform," he said. "The nation's reform will come about only through the faith of Islam and a leadership that imposes this faith and God's will."
Liberal reformists have not despaired yet. While one group launched yet another petition, to demand the release of their colleagues, others met Prince Nayef, the owlish interior minister, to make the request personally. Participants at the dawn meeting said that the prince assured them that royal doors would always be open to citizens' complaints but that "foreign agencies" were exploiting the reformers' platform in order to damage Saudi national unity. In other words, to call openly for domestic change is tantamount to treason.
Copyright ? 2004 The Economist Newspaper and The Economist Group. All rights reserved.

RECIT
Les "tigres" de Guantanamo
LE MONDE | 27.03.04 | 13h08
Le 17 mars, le Pentagone a fait visiter ? un groupe de journalistes le camp de Guantanamo, transform? en v?ritable usine ? interrogatoires par une unit? sp?cialis?e : les Tiger Teams.
Au nom de la guerre contre le terrorisme, les Etats-Unis d?tiennent plus de 600 personnes sans jugement ? Guantanamo. A intervalles r?guliers, le Pentagone y organise des "media tours". Avant l'embarquement, les journalistes s'engagent par ?crit ? ne pas tenter d'entrer en communication avec les prisonniers. Chaque soir, un militaire revoit le contenu des appareils photo. Les visages de d?tenus sont effac?s, conform?ment aux conventions de Gen?ve, ainsi que tout ce qui pourrait nuire ? l'image de l'arm?e.
La visite guid?e ordinaire du 16 au 19 mars a pris un relief particulier. Accus?e de maltraiter les prisonniers, l'arm?e am?ricaine a montr? quelques sc?nes du camp Delta. Pour la premi?re fois, la presse a pu voir les pi?ces o? se d?roulent les interrogatoires. Les militaires ont aussi ouvert la salle du tribunal o? se tiendront les proc?s des "ennemis combattants". Les audiences ne commenceront pas avant plusieurs mois, mais, dans ce no man's land juridique qu'est Guantanamo, les responsables am?ricains sont press?s de montrer qu'une ?bauche de juridiction, f?t-elle militaire, est en chantier.
Le commandant du camp, le major- g?n?ral Geoffrey Miller, a tenu ? pr?senter lui-m?me le travail accompli. Guantanamo est "un laboratoire dans la guerre contre le terrorisme, a-t-il expliqu?. La d?tention est humaine, ici, et nous en sommes fiers". C'?tait sa derni?re conf?rence de presse. Apr?s dix-huit mois ? Cuba, il a ?t? nomm? le 22 mars en Irak. L?-bas aussi, il s'occupera de d?tention. "Les Etats-Unis ne torturent jamais personne, a-t-il assur?. Nous autorisons certaines techniques d'interrogatoire, mais pas les techniques coercitives."
Dans la foul?e, le lieutenant-colonel Pamela Hart a projet? le diaporama de pr?sentation du camp. Guantanamo : 610"ennemis combattants", 2 162 soldats. De 250 ? 300 interrogatoires par jour. Il est interdit d'enregistrer, a-t-elle dit, mais on a le droit de citer.
LA BASE
Guantanamo n'est pas vraiment une baie. Tout juste un morceau. Pour aller de l'a?roport ? la base, il faut prendre un ferry. Les Etats-Unis louent l'endroit ? Cuba depuis 1903, au terme d'un bail perp?tuel. Si Fidel Castro dispara?t, le commandant de la base navale, Les McCoy, ne pr?voit pas de changement. "La base sera conserv?e aussi longtemps que durera la guerre contre le terrorisme", anticipe-t-il.
La base est envahie d'engins de chantier. Delta I, Delta II, Delta III, camp 4, camp 5, camp Echo... Depuis l'ouverture, en janvier 2002, Guantanamo a connu une sorte de boom immobilier. Le camp 5 n'est pas encore tout ? fait termin?. Ce sera le joyau du syst?me. "L'installation d'interrogatoires et d'isolement du XXIe si?cle", explique le diaporama. Tout sera informatis?. " On pourra tenir quatorze interrogatoires en m?me temps, s'exclame un officier. Et sans une feuille de papier !"
Depuis janvier, le Pentagone s'impatiente. Il faut acc?l?rer les lib?rations. Sur place, les militaires voudraient ?tre s?rs que les d?tenus ont livr? tous leurs secrets. En deux ans, 119 d?tenus ont ?t? rel?ch?s et 12 autres ont ?t? transf?r?s pour incarc?ration dans leur pays (4 Saoudiens, 1 Espagnol, 7 Russes). Le camp 5 va accro?tre "l'efficacit? de la main-d'?uvre de 50 %". Cette fois, il ne s'agit pas de pr?fabriqu?. Le b?timent a une "dur?e de vie de cinquante ans". Les premiers condamn?s y seront probablement d?tenus. Le commandant Miller d?ment toute intention d'y construire une chambre d'ex?cution.
Les d?tenus sont originaires de 42 pays. Six seulement font l'objet de poursuites. Les derniers sont arriv?s en novembre 2003. Les militaires continuent d'affirmer que personne n'a d?barqu? l? par hasard et qu'ils d?tiennent des membres d'Al-Qaida qui travaillaient ? la mise au point de chaussures ? explosifs ou ? l'emploi de t?l?phones cellulaires comme d?tonateurs. "Plus d'une cinquantaine n'ont aucun scrupule ? expliquer qu'ils sont des djihadistes actifs et que, s'ils sont lib?r?s, ils retourneront imm?diatement au combat", affirme Steve Rodriguez, le chef du renseignement, d'origine cubaine.
M?me leur ?ge est tenu secret. Pour montrer qu'il n'y a pas de mineurs, l'arm?e ne l?sine pas. Elle proc?de ? une radio du poignet et ?value la densit? des os. La marge d'erreur ?tant de 1 ? 3 ans, le commandant juge impossible de se prononcer. A l'autre extr?mit?, il reconna?t qu'"un petit nombre de d?tenus approchent les 70 ans". Les d?tenus n'ont pas de visite d'avocat ni de famille. Mais ils ont ?t? mis au courant que "l'Irak avait ?t? lib?r?", comme dit un officier. Ils n'ont plus d'aum?nier musulman depuis l'arrestation du capitaine James Yee. L'officier a ?t? accus? d'espionnage au profit de la Syrie et de s?dition. Il a pass? soixante-seize jours aux arr?ts. Finalement, l'arm?e a laiss? tomber les charges. Le 22 mars, il a ?cop? d'une r?primande pour adult?re.
Pr?s des deux tiers des soldats sont issus de la r?serve ou de la Garde nationale. Ils aimeraient bien rentrer chez eux, mais ils sont convaincus de participer ? la GWOT (global war on terror), la lutte globale contre le terrorisme. "Personne ne se l?ve le ma- tin en se disant : chic, je vais aller surveiller des terroristes !, dit le sergent Jansen. Mais, en m?me temps, pendant qu'ils sont ici, ils ne sont pas l?-bas en train de faire on ne sait quoi."
Sortis du camp Delta, les soldats ach?tent le Navy Times. Ils regardent la t?l?vision des forces arm?es (AFN). Les publicit?s sont une succession de mises en garde. Contre le soleil, qui br?le. Contre le bavardage, qui peut ?tre exploit? par l'ennemi. Il leur arrive d'?tre confront?s ? des questions d?licates : "Mes enfants ont lu dans la presse le t?moignage des Britanniques qui se sont plaints d'avoir ?t? maltrait?s, confie un officier, hors micro. Ils m'ont t?l?phon? : vous faites vraiment ce genre de choses l?-bas ?"
LES INTERROGATOIRES
La pi?ce ma?tresse du dispositif carc?ral est l'interrogatoire. Une unit? a ?t? sp?cialement form?e pour Guantanamo et entra?n?e dans l'Arizona. Elle a transform? le camp en une usine ? interrogatoires. Selon le commandant Miller, les Tiger Teams sont maintenant plus de 200, et elles sont pr?sentes en Afghanistan et en Irak.
Les militaires jurent qu'ils ont obtenu des renseignements int?ressants sur des cellules en activit?, y compris en Europe. Renseignements qui ont m?me permis de "lancer des op?rations militaires" ou de mettre en cause "des organisations charitables fournissant un soutien financier ? Al-Qaida". Ils sont contents aussi d'obtenir des renseignements topologiques sur les chemins et les caves des montagnes afghanes. D'un point de vue sociologique, il n'y a pas de d?tenu inint?ressant. "Chaque d?tenu a une valeur diff?rente, explique le commandant Miller. Et tous nous aident ? comprendre le terrorisme et la mani?re de le r?duire."
Les interrogatoires sont men?s principalement par des r?servistes. Le mensuel Vanity Faira interrog?, en janvier, des professionnels de l'espionnage, qui ont ironis? sur l'enthousiasme de n?ophyte des Tiger Teams. Depuis, l'?tat-major met en avant l'"expertise" de ses troupes. Le chef des Tiger Teams appartient ? la division homicides du service de police d'une grande ville du Midwest. Il pr?f?re garder l'anonymat, mais il a "400 inculpations ? son palmar?s".
Les Tiger Teams fonctionnent par ?quipes de trois : analyste, interrogateur et interpr?te. L'interrogatoire se d?roule dans une pi?ce quasiment vide, munie d'une table, d'un miroir sans tain, d'une cam?ra et d'un anneau dans le sol. Le d?tenu arrive menott? dans son "costume trois pi?ces", l'ensemble de cha?nes qui lui entravent pieds et mains et sont reli?es ? la ceinture.
Au mur, il y a des affiches de l'Afghanistan. Sur un ordinateur portable, on lui montre ? l'occasion un film de propagande, Afghan Spring, pour lui donner la nostalgie. "Ils voient que l'?cole a ?t? repeinte en jaune ; on leur raconte que la route Kandahar-Kaboul est en reconstruction", indique le chef enqu?teur. Il affirme avoir r?ussi ? faire parler l'an dernier "l'instructeur d'Al-Qaida pour les explosifs. (...) On a jou? aux ?checs et on a mang? des hamburgers, beaucoup de hamburgers. C'est un individu qui aime manger".
Les Tiger Teams ont une salle avec un d?tecteur de mensonges. Le commandant d?ment qu'elles utilisent l'arme de la privation de sommeil : "En tout cas, pas depuis que je suis l?." Les sessions durent au maximum dix heures, en deux s?ances de cinq heures. Mais l'interrogatoire peut avoir lieu ? tout moment, sept jours sur sept et vingt-quatre heures sur vingt-quatre. La devise du groupe : "Tiger never sleeps" (le tigre ne dort jamais).
DES "?L?MENTS DE CONFORT"
Le camp Delta est install? ? l'endroit que les Cubains ne voient pas depuis leurs miradors. L'un des coins les plus arides, au bord de la falaise. Il faut boire plusieurs litres d'eau par jour. Pour inciter les d?tenus ? parler, le major-g?n?ral Miller et ses hommes ont d?velopp? un syst?me de triage. "A l'isra?lienne", dit un sp?cialiste des prisons. S'ils sont "coop?ratifs", les prisonniers gravissent les ?chelons. Partant des camps 2 et 3, de haute s?curit?, l'objectif est d'arriver au camp 4 (s?curit? moyenne).
Les d?tenus sont encourag?s ? ?tre coop?ratifs par des r?compenses, des "?l?ments de confort". Sont consid?r?s comme des ?l?ments de confort : les brosses ? dents de plus de 3 cm, le calot de pri?re, les livres, les minutes de sport additionnelles... Et l'eau. Le fait d'avoir de l'eau en bouteille est un ?l?ment de confort qui se monnaie : "Une bouteille bien fra?che, au lieu de boire au robinet", sugg?re un officier. Parfois, c'est le gobelet en carton qui se m?rite. "Un gobelet plut?t que de devoir boire dans ses mains", r?sume le colonel Cannon.
Les privil?ges sont r?vocables. En cas de "mauvaise conduite", le d?tenu peut "perdre un objet pour cinq jours, par exemple". De 20 ? 30 d?tenus n'ont jamais quitt? le camp 3, indique le g?n?ral. Des "non-coop?ratifs", dont il est difficile d'obtenir l'identit?. Une centaine, dits "dociles", sont au camp 4. Les gardiens sont ?quip?s d'ordinateurs. "Un logiciel con?u par la police militaire pour la police militaire", dit le lieutenant-colonel Michael Young.
Des incidents ont lieu plusieurs fois par semaine. "Par exemple, quand une femme de la police militaire passe juste au moment o? un d?tenu sort de sa douche, dit le colonel Cannon. Ou quand on cogne le Coran qui est accroch? au grillage." Il arrive aussi que les prisonniers "hurlent des menaces contre les troupes am?ricaines, d?noncent les Infid?les, jouent sur les questions d'ethnicit? ou insultent les femmes". Un quart des membres de la police militaire sont des femmes, et il n'est pas question de changer. La soldate Jiovani Barber, 24 ans, une joailli?re des ?les Vierges, estime avoir pris le dessus. "S'ils veulent avoir quelque chose, ils sont bien oblig?s de me le demander."
La police militaire ramasse les ustensiles en plastique pour ?viter les suicides. Il y a d?j? eu 34 tentatives par pendaison. Le CICR a protest? l'an dernier contre la d?t?rioration psychologique des d?tenus, en l'absence d'une notion de temps et de limite ? la d?tention. Le colonel Cannon estime avoir mis fin ? la s?rie. Non pas que le moral soit meilleur, mais il a augment? la fr?quence des patrouilles. Les suicidaires n'ont plus le temps de s'organiser.
Au camp 4, l'uniforme n'est plus orange, mais blanc. "C'est beaucoup plus frais et beaucoup plus prestigieux dans leur culture", croit savoir un officier. Les d?tenus ont une vie communautaire et passent huit heures par jour hors des cellules. Le camp 4, c'est "la terre promise", dit le chef de la d?tention, "la derni?re ?tape avant de rentrer ? la maison". Les d?tenus re?oivent des chaussures en toile en plus de leurs flips-flops. L'appel ? la pri?re est retransmis par les haut-parleurs du mirador. Les d?tenus n'auront jamais vu un juge en deux ans, mais on ne les aura pas bern?s sur l'heure de la pri?re. "On regarde sur l'Internet pour ?tre s?r de l-heure exacte", explique le sergent Sam Wireman.
In extremis, on tente de leur donner une autre image de l'Am?rique. Au lieu d'une rotation constante, les gardiens s'efforcent de d?velopper une relation avec les d?tenus. Des cam?ras surveillent les chambr?es, mais n'enregistrent pas les sons. Apr?s avoir v?cu derri?re des grillages, les d?tenus ont droit ? un rideau de douche.
Lorsque nous avons visit? le camp 4, des d?tenus jouaient au ping-pong ; d'autres ?taient assis autour des tables de pique-nique. Un instant, une voix nasillarde, venue d'une chambr?e, a couvert les explications du sergent. Une grammaire approximative, mais le message ?tait clair : "Il ment avec vous." Plus loin, il y a eu quelques cris : "Go ! Go !"

Corine Lesnes

* ARTICLE PARU DANS L'EDITION DU 28.03.04





Affaire Ioukos: des milliards bloqu?s en Suisse
swissinfo 29 mars 2004 20:58
Tandis qu'une partie de ses fonds sont bloqu?s, l'ancien patron de Ioukos Mikha?l Khodorkovski est en prison. (Keystone)
La Suisse a gel? une somme record de plusieurs milliards de francs dans l'affaire du g?ant p?trolier russe Ioukos.
Les avocats des personnes et soci?t?s vis?es vont faire recours contre ce blocage. Ils critiquent l'attitude de la justice suisse dans un dossier qu'ils estiment hautement politique.
M?me si aucun chiffre pr?cis n'a ?t? articul?, les sommes en jeu dans cette affaire sont consid?rables. Le Parquet russe, qui a demand? l'entraide judiciaire de la Suisse, a r?cemment ?voqu? le gel de 6,2 milliards de francs sur les comptes de 20 actionnaires de Ioukos, parmi lesquels l'ex-PDG Mikha?l Khodorkovski.
Dans un communiqu?, le Minist?re public de la Conf?d?ration (MPC) pr?cise que les sommes ont ?t? gel?es ? la fin de la semaine derni?re et qu'il ?s'agit d'avoirs de personnes physiques et morales concern?es par la proc?dure p?nale en Russie?.
?Vague et incompr?hensible?
Lors d'une conf?rence de presse convoqu?e ? Gen?ve, l'avocat Philippe Neyroud, mandat? pour d?fendre entre autres Mikha?l Khodorkovski, a qualifi? ce dossier de ?politique?.
Le gel des avoirs par Berne s'est fait sur une demande russe ?vague et incompr?hensible?. Aucun pays au monde n'aurait r?agi comme l'a fait la Suisse, ajoute l'avocat.
Il demande donc ? la justice suisse de ne pas tomber dans le pi?ge politique et de s'engager dans une analyse ind?pendante du dossier.
Quant ? la somme exacte qui a ?t? gel?e, Ma?tre Neyroud juge ?faux? le chiffre de 6,2 milliards de francs. L'avocat genevois, accompagn? de deux confr?res am?ricains, n'a cependant pas voulu donner d'estimation.
Cinq banques
Le MPC, qui avait jusqu'ici refus? de confirmer le gel des fonds, ne fournit pas non plus de chiffres pr?cis.
?Il ne s'agit pas uniquement de comptes dont les montants peuvent ?tre d?termin?s en francs et en centimes, mais aussi d'autres biens et avoirs dont la valeur est difficile ? estimer ? premi?re vue?, explique son porte- parole, Hansj?rg Mark Wiedmer.
L'affaire est complexe, avec une trentaine de soci?t?s et une vingtaine de personnes vis?es.
?Il y a s?rement eu amalgame?, affirme Ma?tre Neyroud. Selon lui, cinq banques auraient re?u des requ?tes de gel de comptes: l'UBS, BNP Paribas, SG Banque, Cr?dit Agricole Indosuez, et Dresdner Bank.
Pour l'avocat am?ricain Sanford Saunders, Mikha?l Khodorkovski et ses amis sont attaqu?s car ils repr?sentent le changement en Russie. Pour lui, ?ce qui leur arrive en Suisse est la continuation de ces attaques?.
Gel provisoire, puis formel
A la suite de la commission rogatoire russe, des perquisitions ont ?t? men?es dans quatre cantons le 4 mars dernier, dans le cadre d'une proc?dure pour ?appartenance ? une organisation criminelle, abus de confiance, escroquerie et escroquerie fiscale?.
Le MPC a saisi des documents, entendu des t?moins et proc?d? au blocage d'avoirs ?par mesure urgente et provisoire?, afin de sauvegarder des moyens de preuve.
La justice russe ayant confirm? cette demande de blocage dans un compl?ment ? sa commission rogatoire, il a ?t? proc?d? ? un gel formel.
Gel record
Les avocats annoncent un recours au Tribunal f?d?ral (cour supr?me). Le gel d'une telle somme constitue un record pour la Suisse. Pour m?moire, la justice helv?tique avait bloqu?, en janvier 2000, pr?s d'un milliard de francs, d?pos? en Suisse par l'ex-dictateur nig?rian Sani Abacha.
Le groupe Ioukos est accus? par Moscou d'?vasion fiscale et de fraude ? grande ?chelle. Mais des analystes ? Moscou pr?sentent cette affaire comme une tentative du pr?sident Vladimir Poutine de mettre au pas Mikha?l Khodorkovski en raison de ses ambitions politiques.
swissinfo et les agences
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L'?conomie suisse face au d?fi de l'?largissement
swissinfo 29 mars 2004 08:19
D?s le 1er mai, les entreprises suisses vont se tourner un peu plus vers l'Europe de l'est. (Keystone)
En panne de croissance, l'?conomie suisse s'appr?te ? rivaliser contre une Europe de 25 Etats.
Les secteurs traditionnellement li?s aux exportations en profiteront. Mais le march? int?rieur devra ?tre r?form? pour b?n?ficier pleinement du retour de la croissance.
Nombre d'experts ?conomiques, l'Organisation de coop?ration et de d?veloppement ?conomiques (OCDE) en t?te, s'accordent ? le dire: la croissance ?conomique suisse traverse une passe difficile depuis une dizaine d'ann?es.
Au moment o? dix pays d'Europe centrale et de l'Est s'appr?tent ? rejoindre l'Union europ?enne (UE), l'?conomie suisse semble toujours plus isol?e au milieu d'un continent dont l'interconnexion des ?conomies avance ? pas de g?ant.
Le nouvel ?largissement de l'UE ne semble cependant pas affoler outre mesure les milieux patronaux helv?tiques. Ils y voient en effet une opportunit? de se profiler sur de nouveaux march?s.
L'?largissement comme aiguillon
?L'?largissement de l'Union europ?enne constitue en fait une meilleure incitation ? d?velopper le commerce et positionner nos entreprises sur des march?s d'avenir pour nos projets?, rel?ve Catherine Lance, charg?e de projet pour economiesuisse.
Des opportunit?s qui existent pourtant depuis la chute du mur de Berlin. Mais la nature sauvage de l'?conomie, qui caract?risait ces pays jusque dans un pass? r?cent, comportait beaucoup de risques pour qui osait s'y aventurer.
D?faut de paiement, non-respect des d?lais de livraison, disparition des marchandises, impossibilit? d'actionner les m?canismes juridiques pour faire respecter ses droits... Tout un floril?ge de m?saventures v?cues par nombre d'investisseurs ?trangers.
Mais les temps ont chang?. Et l'adh?sion de ces pays indique que toutes les pratiques commerciales se sont align?es sur celles de l'UE.
Une aubaine pour les soci?t?s suisses?
Pour les entreprises suisses, les avantages d?coulent surtout des simplifications administratives.
?Les dix syst?mes nationaux diff?rents qui existent actuellement seront dor?navant semblables ? ceux des autres membres de l'Union. Ce qui facilite grandement la t?che des entreprises qui voudront se d?velopper dans ces nouveaux pays?, poursuit Catherine Lance.
Au-del? de ces simplifications, les relations ?conomiques et commerciales entre la Suisse et les nouveaux adh?rents seront r?gl?es par l'accord de libre-?change conclu en 1972 avec l'UE et les sept accords bilat?raux (bilat?rales I). De quoi donner certains gages de s?curit? aux investisseurs.
?En faisant leur entr?e dans l'Union europ?enne, ces pays montrent aux autres qu'ils appliqueront le m?me droit de la m?me fa?on que dans les autres pays de l'Union, souligne Ren? Schwok, ce qui devrait rendre les investissements plus rentables.?
Professeur ? l'Institut d'?tudes europ?ennes ? Gen?ve, il estime en outre que les exportations suisses seront les principales b?n?ficiaires de l'?largissement. ?Depuis plusieurs ann?es, la croissance ?conomique des nouveaux adh?rents est plus importante que celles des membres de l'Union.?
Un potentiel ? d?velopper
Selon une ?tude du Credit Suisse Group de 2003 - qui mesure l'impact de l'?largissement sur la Suisse - 2,5% du commerce ext?rieur helv?tique se fait avec les nouveaux entrants.
La Pologne, la Hongrie et la R?publique tch?que, ensemble, ne recueillent que 1% des investissements directs de la Suisse ? l'?tranger. Au vu de ces chiffres, le potentiel existe mais la Suisse devra compter avec une s?v?re concurrence ?manant des autres membres de l'Union.
La banque identifie principalement trois secteurs susceptibles de conna?tre une croissance substantielle, ? savoir les produits chimiques, les machines et l'?lectronique. Des secteurs auxquels Ren? Schwok rajoute le secteur financier.
?Banque, assurance, r?assurance, n?goce sont des secteurs dans lesquels le savoir-faire suisse peut se distinguer?, explique le professeur genevois.
Pas de boom attendu
L'?largissement de l'UE ne provoquera donc pas une v?ritable explosion des exportations suisses. Certains secteurs en profiteront mais de fa?on relativement marginale.
Quant ? la croissance ?conomique nationale, son salut viendra avant tout de la r?forme de son march? int?rieur: lutte contre les cartels, am?lioration de la transparence et facilitation de la cr?ation d'entreprises.
Autant de domaines mis ? mal chez les membres de l'UE et contre lesquels le gouvernement suisse semble s'?puiser depuis trop longtemps. Mais sans r?sultats significatifs.
swissinfo, Jean-Didier Revoin

Clarke Is Right
Below the grandstanding is some solid expertise.

It has been widely remarked by now that Richard Clarke was the most aggressive counterterrorism official in the Clinton administration, privately frustrated by his inability to get the Clinton team to take up his most important ideas. The fact that Clarke is quite sound on terrorism issues -- at least those not touching on the Iraq war -- has now been obscured by his star turn as an anti-Bush partisan. But if you focus on what Clarke said in his testimony before the 9/11 commission when he wasn't beating up on Condi Rice et al, you hear a quite reasonable analysis of the U.S. response to terrorism.

First, Clarke agrees with the assessment of the Bush team that his proposals for action in Afghanistan -- aiding the Northern Alliance, flying the Predator, etc. -- would not have prevented 9/11. Asked of his proposals at the commission hearing, "assuming that [they] had all been adopted, say, on January 26, year 2001, is there the remotest chance that it would have prevented 9/11?" Clarke's answer: "No."

Clarke agrees with the argument -- made repeatedly by conservatives over the years -- that the CIA had been beaten into a defensive crouch by its critics. As Clarke explained to the 9/11 commission, "our HUMINT program, our spy capability, had been eviscerated in the mid-1980s and early-1990s, and there was no such capability either to know that al-Qaeda existed, let alone to destroy it. And there's something else that I think we have to understand about the CIA's covert action capabilities. For many years they were roundly criticized by the Congress and the media for various covert actions that they carried out at the request of people like me in the White House -- not me, but people like me. And many CIA senor managers were dragged up into this room and others and berated for failed covert action activities. And they became great political footballs."

Clarke seems to agree with a point often made by Clinton critics: that it was foolish in the 1990s to make the FBI the lead agency in the fight against terrorism since, as an after-the-fact domestic law enforcement agency, it was manifestly not up to the task. He explained to the commission, "the fact that we didn't have intelligence that we could point to that said [an attack] would take place in the United States wasn't significant in my view because, frankly, sir -- I know how this is going to sound, but I have to say it -- I didn't think the FBI would know whether or not there was anything going on in the United States by al-Qaeda." A commissioner asked, "Well, the FBI was the principal agency upon which you had to rely -- is that not the case?" Clarke replied, pregnantly, "It is."

Clarke emphasizes the need for preemption. He explained, "One of the things I would hope comes out of your commission report is a change -- a recommendation for a change in the attitude of government about threats; that we be able to act on threats that we foresee, even if acting requires boldness and requires money and requires changing the way we do business, that we act on threats in the future before they happen. The problem is that when you make that recommendation before they happen, when you recommend an air defense system for Washington before there's been a 9/11, people tend to think you're nuts."

Clarke apparently sees the need for more domestic surveillance in the U.S., advocating doing the Patriot Act one better and creating a domestic intelligence agency. Just imagine the howls from the ACLU. Clarke acknowledged this, but said it was worth it, "I am very fearful that such an agency would have potential to infringe on our civil liberties, and therefore I think we would have to take extraordinary steps to have active oversight of such an agency. And we'd have to explain to the American people in a very compelling way why they needed a domestic intelligence service, because I think most Americans would be fearful of a secret police in the United States. But frankly, the FBI culture, the FBI organization, the FBI personnel are not the best we could do in this country for a domestic intelligence service."

Clarke apparently agrees that law enforcement is an inappropriate paradigm for fighting. He noted the problem with accepting the rules of evidence that apply to criminal cases when it comes to terrorism. He was, for instance, frustrated when the Clinton administration called in the FBI to confirm Iraqi involvement in the attempted assassination of the first President Bush in early 1993, creating an unnecessary delay. He explained, "And that took from February of '93 through the end of May. And it was done in a way that was reminiscent of a criminal process. At least the FBI case was. The CIA case was an intelligence case and had different sources of information, different standards for what was admissible, and a more lenient standard for making a determination. But I think beginning then, I was frustrated by that kind of evidentiary process."

Clarke defends the idea of acting even when the intelligence is uncertain, especially when WMDs are potentially involved. He defended the Clinton administration's controversial 1998 attack on a Sudanese pharmaceutical plant, which many observers think was based on flimsy intelligence at best. Clarke said, "To this day, there are a lot of people who believe that it was not related to a terrorist group, not related to chemical weapons. They're wrong, by the way. But the president [Clinton] had decided in PDD-39 that there should be a low threshold of evidence when it comes to the possibility of terrorists getting their access -- getting their hands on chemical weapons."

-- Rich Lowry is author of Legacy: Paying the Price for the Clinton Years.

http://www.nationalreview.com/lowry/lowry200403290950.asp
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Loose Canons
Mr. Clarke and Mullah Brezhnev
By Jed Babbin
Published 3/29/2004 12:06:21 AM


First we had It Takes a Village. Then there was Living History. Now we have Against All Enemies. Like the first, it was not written by Hillary Clinton and, like the second, it is revisionist history at its worst.

Mr. Clarke -- former White House terrorism "czar" during the era of al-Qaeda's first round of attacks on America -- is doing his best to sink President Bush. If you listened to Clarke's testimony to the 9-11 Commission this week, you would have heard that Mr. Bush came into office and -- with the Wolfowitz snarling at the White House door -- ignored al-Qaeda and everything the smartest people (meaning Clarke) were saying. According to Clarke, by deposing Saddam Mr. Bush only made the world a more dangerous place. Clarke wants us to believe that if only Mr. Bush had chosen him instead of Condi Rice for National Security Advisor, if only Mr. Bush had done what Clarke had said instantly, and every time, maybe -- just maybe -- we would have been spared the 9-11 attacks. Nonsense.

Clarke was in the White House for eight years, all through the Clinton administration's failures and now wants the world to ignore that track record. His major accomplishment was a completely useless strategy on cyber-terrorism.

All you need to know about Clarke is that the release of his new Bush-bashing book Against All Enemies happened the day before his melodramatic testimony. I'm sure it was a coincidence that the book release was accelerated by a month -- as Tim Russert noted on Meet the Press -- to appear in bookstores in time for his testimony.

Clarke began by apologizing to the families of 9-11 victims for his failure to stop the attacks. All he lacked was the trembling lower lip. He grandstanded, putting himself in the place of the government of the United States, of which he wants the world to believe he should have been in charge. His arguments are not only partisan but dishonest. He famously briefed reporters in August 2002 about the efforts of the Bush administration to fight terrorism and said, at length, that the Bush administration was working hard to change and improve anti-terrorist actions, including quintupling the covert action budget for the CIA. Now he says that he disagreed with what he said then. On Meet the Press, he said that he had to do that or resign, and chose to spin because -- he implied -- he, Clarke the omniscient, was just too important to the anti-terror effort to leave it in the hands of others. Read the soon-to-be unclassified Clarke testimony of two years ago -- and the already-available 9-11 Commission staff report for the details.

Clarke will sell a lot of books as a result of this publicity exercise. He will be hired by some network as a terrorism "expert" and be in our faces through the election. That alone makes it important to understand what he is saying, and why it is so terribly wrong.

THE MOST IMPORTANT CHARGE Clarke makes -- and the one that is blatantly partisan -- is that by deciding to topple Saddam, Mr. Bush made the world a more dangerous place. He said on Meet the Press that America is more hated now in the Arab world than it was before, and that by removing Saddam, we have made it harder to gain the trust of the Arab world. He also said that the war in Iraq weakened the war against terrorism by angering the Arab world and by taking needed resources away from the war against al-Qaeda. That's his principal position, and it is the most demonstrably wrong one he took, which is saying quite a lot.

If Clarke is to be believed, why would 9-11 have happened? If our diplomacy and foreign aid were successful, why would terrorists have killed thousands of American that day? Had we stayed out of Iraq, and left the job of persuading the Arab nations to help fight terrorism to the diplomats, our Clinton-era posture in the Middle East would have remained unchanged and unsuccessful. The principal development in the Middle East in the Iraq campaign is the demonstration to the despots and religious thugocracies there that we will act decisively to stop their involvement in terrorism. Though most of those nations -- particularly Iran -- still don't believe we will do to them what we did to Saddam, there is a signal of a change in their thinking. Does anyone seriously believe that Muammar Qaddafi would have surrendered his nuclear weapons program if he was unconcerned about being next on Uncle Sam's list?

Clarke still doesn't understand that we cannot give a rat's behind about what the average man on the street in Damascus or Teheran thinks of us if we want to end the terrorism those nations produce. We cannot say it often enough: terrorism doesn't result from poverty, it isn't aimed at us because we don't sing "Kumbaya" in Arabic often enough. Terrorism is driven by ideology and fueled by a poisonous interpretation of religion. It's much more important to recognize that radical Islam -- terrorist Islam -- is being spread by a propaganda line we should well remember.

Those who preach it -- whether it's the Saudi Wahabbism, the Iranian edition, or one of the others -- insist that terrorist Islam will succeed inevitably, and its seizure of power in any nation is irreversible. It is, they say, the will of God. More than thirty years ago, a guy named Leonid Brezhnev said the same thing about communism, and the Clarkes of that era bought it. At least until Lech Walesa and some very brave Poles proved the Brezhnev Doctrine, as it became known, to be utterly false. By overthrowing communism and establishing democracy, Walesa and his people drove a stake through the heart of communism. If there is a central strategy in our war against terror, it must be this: those who propagandize the inevitability and irreversibility of radical Islam must be proven wrong just as the Brezhnevites of the 1970s were, and in the same way.

If we are to succeed in the long-term war against Islamic terror, we must succeed in the same way, and to the same degree that the Poles did. We have so far toppled two regimes. But in neither in Afghanistan nor in Iraq did we topple a radical Islamist regime in an Arab country. The first time we do this, and manage to get the people of that nation to establish basic freedoms, we will have created a new Poland in the Arab world. By doing so, and only by doing so, can we finally defeat the Brezhnevite Islamists and bring the era of global terrorism to an end.


TAS Contributing editor Jed Babbin was a deputy undersecretary of defense in the first Bush administration, and now often appears as a talking warhead on radio and television.

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Those who predicted Islamist terrorism ran against the wind
By Barbara Amiel
(Filed: 29/03/2004)


'I hate terrorists!" "I hate them more!" There's a catfight in Washington at the Senate hearings on 9/11. Richard Clarke, the former terrorism tsar, is apologising to all Americans for not being a step ahead of the World Trade Centre horror. Book sales are soaring for Clarke's dump on President Bush and his inside story of the war on terrorism (including that practised by Washington bureaucrats). CNN is rapturous and appears to have Clarke on a half-hourly loop. White House television correspondents are interviewing those who lost "loved ones" and are at the hearings to learn "what really happened on September 11, 2001".

They won't learn much. Clarke's apology to the families of those killed and his dramatic "I failed you" is probably heartfelt, since he was in four successive administrations and is one of a dozen or two top officials charged with the task of tackling terrorism. But I can't see how any American government or individual, of either party, could have prevented the development of international terrorism. The question is not whether Reagan-Bush-Clinton-Bush actually knew about the murderous intentions of radical Islam or whether they took what they knew seriously, but what the public mood would have let them do about it before 9/11.

Not much, I wager. What administration could, before 9/11, have sent in American boys to fight a regime in Afghanistan because it was implementing the ideas of an old man with a long white beard, sitting crossed-legged in the mountains talking about Satan America? Had I been in Congress before 9/11, knowing everything that was knowable about the Islamists, I still doubt if I would have voted to send troops to the Hindu Kush to topple the Taliban. Eardrums would have exploded all over Capital Hill from outcries of racism and imperialism if there had been serious efforts, pre-9/11, to round up suspected Muslim militants in the United States and tighten security on Muslims entering the country. As it is, the post-9/11 sensitivity to racial profiling makes travel hazardous for white grannies who dislike body-searches.

What is possible in politics depends to a great extent on what is blowing in the wind. There are times when even a Churchill can't trudge against it, no matter how accurate his sense of direction. The notion of terrorism as a lethal threat to America had no force, even after the assassination of the radical Rabbi Kahane (New York, 1990), the first bombing of the World Trade Centre (1993) and the deadly attacks on America embassies, citizens and military abroad - all carried out by Islamists. The American eagle was in ostrich mode.

Some people do try to run against the wind. Steve Emerson worked for CNN until one day, being a nosy reporter, he walked into a meeting where a Hamas leader was speaking about the need to kill Jews and carry out jihad - in Oklahoma City. He left CNN and made domestic terrorism his field of research. By 1994 he had assembled a film, Jihad in America, that no mainstream network would run. The film showed footage of Islamic terror-mongers in cities as varied as Dallas, Detroit, New York and Atlanta, recruiting for both domestic and world-wide jihad. "Jihad means fighting only, fighting with the sword," said Sheikh Abdullah Azzam, speaking at a conference in Brooklyn in 1989. His cousin went further. In Atlanta in 1990, Fayiz Azzam harangued: "Allah's religion - be he praised - must offer skulls, must offer martyrs. Blood must flow. There must be widows, there must be orphans. Hands and limbs must be cut..."

The film was an astonishing piece of work for its time. Looked at now, it is eerie in its prescience. Emerson finally wangled a one-time, limited showing on PBS, on November 21, 1994. In spite of the routine caveats in the documentary, reiterating the distinction between radical Islamists and the religious beliefs of the vast majority of moderate Muslims, only Muslim extremists spoke out about the film, organising letters of protest. The moderate Muslims remained, as ever, so moderate as to be invisible.

Emerson became an encyclopaedia on Islamic terrorism and its adherents in America. His knowledge was no help to his journalism career. "You're radioactive," one Washington Post reporter told him, after having been instructed by his editor never to use any material or research from Emerson. He met the common fate of those who run against the zeitgeist. Until 9/11, he was marginalised in the mainstream press and smeared by much of the Left as a fanatic. Like many single-issue people, he occasionally lacked caution in his work, unwise when working in a minefield, but probably necessary in the first place.

Yigal Carmon, a friend of Emerson's, had his last day at work as counter-terrorist adviser to Israeli prime minister Rabin on February 26, 1993. That morning he went to the Pentagon to brief the Special Operations and Low Intensity Conflict Group on Islamic fundamentalism. Carmon quoted excerpts from radical Islamists he had translated. The nuances of Arabic were particularly significant to him and he explained them carefully. "Islamic fundamentalism," he concluded, "is an imminent threat to America." The Americans listened carefully. Carmon, a rare combination of street-smart and intellectual heft, knew he hadn't a chance in hell of making them understand. Two and a half hours later he was in New York. He arrived just as a mini-van filled with 500 kilogrammes of high explosives went off in the basement of the World Trade Centre.

Out of government, Carmon set up the Middle East Monitoring and Research Institute and continued translating the broadcasts and meetings of the Arab world. The chilling remarks of Arab leaders appeared in stark contrast to their anodyne sentiments in English.

Still, people rarely welcome Cassandras. As Tolstoy pointed out, Napoleon mesmerised his followers, but if his commands had run against the spirit of the times, even Napoleon wouldn't have been obeyed. Running against the wind, every hour each day, takes an obsessive personality which plays out well in terms of Carmon's unfailing accuracy in his translations and information. But Israelis are more instinctively Peace Now than Fight Now and didn't enjoy Carmon's truths any more than Americans wanted Emerson's film. Not wanting to believe uncomfortable things until it is too late is a universal tendency.

Which is perhaps why Clarke's accusations are so happily greeted. Not just in terms of partisanship but for their simplicity. If 9/11 can be reduced to being Washington's fault, the irrational hate and destruction becomes almost manageable. Change administrations, and the Islamists will go away. Such a seductive, comforting thought echoes in most political battles and elections today. The wind from the east blows gritty grains of fear and delusion into the West's eyes. One wonders apprehensively, which way the zeitgeist of this new millennium will turn. Worse, one fears the calamity that will really turn it hasn't happened yet.


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The (Out)Source of All Confusion
Fear + slow jobs growth + an election year = bad policy.

On Friday, April 2, the Bureau of Labor Statistics will release the employment report for March. Most economists are expecting a solid increase in jobs. But they have expected significant increases for months, only to be proven wrong when the official data were released. Another weak jobs number undoubtedly will raise pressure on Congress and the Bush administration to take action on the issue of outsourcing, which many unemployed workers, especially in information technology (IT), blame for their misfortune.

One reason why the outsourcing issue has gotten so much attention is that it plays to deeply held fears about foreigners, fears that have been part of the American political landscape since the Know-Nothing movement of the 1840s. As Holman Jenkins of the Wall Street Journal recently put it, "The current griping over 'outsourcing' seems almost a species of psychological dysfunction, one that blames foreigners over any explanation that doesn't."

The Bush administration has been very slow to recognize the political threat from the outsourcing issue. Indeed, it played right into it with an ill-timed proposal to allow illegal Mexican workers in the U.S. to have "guest worker" status allowing them to remain here legally. While I think this is a defensible policy, it suffers from appearing to be motivated more by politics than a serious concern for illegal immigration. It looks as if its sole purpose is to win Hispanic votes.

President Bush also shot himself in the foot when he promised to create a high-level post to promote manufacturing, the area where the greatest job losses have occurred. It turned out that this "manufacturing czar" position involved nothing more than renaming an existing assistant-secretary position at the Commerce Department. And the vetting process for the position was bungled: Tony Raimondo, who has outsourced jobs to China from his own business, was named to the post. The appointment was quickly rescinded when John Kerry's campaign brought this fact to the media's attention.

The Bush administration has done little to address the outsourcing issue other than muzzle Greg Mankiw, chairman of the Council of Economic Advisers, for daring to suggest that it is an inevitable process. But others are starting to pick up the slack. A new study by the American Electronics Association offers a balanced perspective.

While acknowledging that outsourcing has hurt some Americans, the AEA study places most of the blame for job loss on slow growth and rising productivity. It also notes that other countries have caught up with the U.S. in terms of education and technology, making them stronger competitors for IT business. They are competing not just on the basis of wages, but quality as well.

The AEA study says that today's concern for outsourcing echoes warnings in the 1980s that Japan was going to take over the world. A recent Forbes article points to parallels with the automation scare of the 1960s. As a presidential candidate in 1960, John F. Kennedy warned that automation "carries the dark menace of industrial dislocation, increased unemployment and deepens poverty."

Robots, Japan, NAFTA, and other threats to our prosperity have never sustained themselves, and the doom-and-gloom crowd has always slunk away without ever explaining why they were so wrong. Ross Perot, for example, has never told us why NAFTA didn't cause the "giant sucking sound of jobs being pulled out of this country" that he predicted in 1992.

Writing in the May/June issue of Foreign Affairs, political scientist Daniel Drezner explains that fears of permanent job loss from trade and technology always arise when unemployment is high for cyclical reasons. But eventually the slowdowns end and employment strengthens again. "Once the economy improves, the political hysteria over outsourcing will also disappear," Drezner writes.

This is exactly what President Kennedy's Council of Economic Advisers told him would happen when fears that automation would cause all jobs to disappear were at a peak forty years ago. CEA chairman Walter Heller explained that the best thing he could do was cut taxes to stimulate investment and consumption, which would raise economic growth and employment regardless of how much automation was going on. When this proved to be correct, the automation hysteria faded away.

Thus, most economists believe that policies aimed specifically at outsourcing are misdirected and potentially counterproductive. For example, a new study by the National Foundation for American Policy argues that anti-outsourcing legislation recently passed by the Senate, by inviting foreign retaliation, reducing competition, and raising costs to governments, will likely destroy more jobs than it saves. The amendment, sponsored by Sen. Chris Dodd (D., Conn.), would prohibit federal contractors or states from contracting-out with foreign businesses.

Outsourcing is an issue only because employment growth is slow. But it is not the cause. Hence, policies directed at restricting outsourcing are unlikely to create any jobs and actually run the risk of making the situation worse.

-- Bruce Bartlett is senior fellow for the National Center for Policy Analysis. Write to him here.

http://www.nationalreview.com/nrof_bartlett/bartlett200403290816.asp

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Kerry in fine shape (except for his ailments)

By Jim VandeHei
The Washington Post
ELISE AMENDOLA / AP
Sen. John Kerry, lower right, snowboards ahead of his instructor, Jim Grossman, at Sun Valley, Idaho, last week.

ST. LOUIS -- Sen. John Kerry, by most measures an unusually fit 60-year-old, has spent key parts of his presidential campaign battling ailments ranging from prostate cancer to a stubborn cough and cold.
Kerry frequently complains to reporters of a stiff right shoulder or allergies that leave his voice raspy and throat sore. For much of this year, Kerry has curtailed speaking and sipped lemon tea to nurse a voice strained by hacking and yakking. In mid-February, he described the ailment to reporters as a "chest thing" and griped about its persistence.
On Wednesday, Kerry will undergo elective shoulder surgery for a slight tear, marking the second time the Democratic candidate has missed time on the hustings for an operation. Shortly after announcing his campaign in 2003, Kerry had his prostate removed to cure early-stage cancer.
In some instances, the aches and illness have come at inopportune times, slowing his campaign at critical junctures. But mostly, they have simply frustrated an athletic candidate who plays hockey and bicycles, snowboards and windsurfs. His biggest complaint: Aches and pains are precluding more frequent workouts.
"Kerry is the most athletic, most vigorous guy in the race," said David Wade, his spokesman. "He bounced back from surgery last year way faster than most, he windsurfs, mountain climbs, skis and snowboards; in great shape -- not exactly the kind of guy whose health is a question mark."
Shortly after announcing Wednesday's surgery, a local TV reporter's first question to Kerry was whether the candidate had a "Cheney problem," a reference to health questions that have dogged the vice president as a result of his heart condition.
Kerry brushed off the inquiry with a simple "no," and declared "I'm healthy." Indeed, based on Kerry's partial medical records, which were released last year, the Massachusetts senator appears in fine and fit condition.
Yesterday morning at Chris's Pancakes and Dining, three different patrons commented about how Kerry looks better in person than he does on television. Yet one man commented, "You need a little flesh on." Kerry agreed and said, "I know, I'm working on it."
Today, Kerry's general physician, Dr. Gerald Doyle, will release an updated summary of the candidate's health record. And Dr. Bertram Zarins, from Massachusetts General, will brief reporters on Kerry's upcoming surgery.
Because Americans generally have chosen presidents whom they view as strong -- from Theodore Roosevelt to John F. Kennedy to Ronald Reagan to George W. Bush, the candidates routinely portray themselves as vibrant and virile.
In the 1992 campaign, Paul Tsongas, who suffered from lymphoma, showed himself swimming in a television commercial to prove his good health. In 1996, Bob Dole, who had been treated for prostate cancer and had minimal use of his right arm from a World War II injury, frequently battled to prove himself fit to unseat a much-younger Bill Clinton.
And Bill Bradley did not disclose his three years of heart problems until he was forced to do so during the last presidential campaign.
In earlier years, politicians and presidents hid their ailments, underscoring how essential the image of strength is to leadership and how open, by historical standards, Kerry and other modern politicians are today about their health.
Grover Cleveland underwent two operations for cancer of the jaw in 1889, but told America he had a tooth removed. Most famously, Franklin Roosevelt hid his disability from Americans in an era when the president's every move was not captured on camera. Now, candidates publicize hospital visits and quickly release medical records to the public.
This year's election features two men who revel in their athleticism. Bush runs a subseven-minute mile and bench presses more than 200 pounds. For relaxation, the president chops wood and clears brush at his ranch.
Bush did have four noncancerous skin lesions removed in December 2001 and recently stopped running as result of a knee injury.
Not to be outdone, Kerry has played hockey with the Boston Bruins and, last week, was photographed snowboarding and hiking up snow-covered mountains. At airports, he often tosses a football or baseball with a top aide before the cameras. He sometimes brings a bike along for working out.
But, several aides said, Kerry's bout with prostate cancer was to blame for the candidate's slow and uneven start to the presidential campaign. After surgery in February 2003, Kerry missed several weeks of campaigning and was sore and tired for many more.
Kerry lied to the Boston Globe when asked if he was sick. He later explained that he wanted to tell his family first. At a news conference to announce his surgery, Kerry's staff distributed a quote from the candidate's doctor describing him as "strong as an ox."
This week's surgery comes at the beginning of a fast and furious general-election campaign -- and only days after Kerry vacationed in Idaho. Some Democrats complained last week that Kerry's absence from the trail was ill-advised.
Wade said Kerry wants to get it over early so it doesn't bother him later in the campaign.


Copyright ? 2004 The Seattle Times Company

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Nuclear Security Decisions Are Shrouded in Secrecy
Agency Withholds Unclassified Information
By R. Jeffrey Smith
Washington Post Staff Writer
Monday, March 29, 2004; Page A21
Nineteen men in four squads. That's the size of the terrorist threat that some nuclear critics say armed guards at U.S. nuclear power plants and weapons facilities should be able to rebuff.
The figure is pegged to the Sept. 11, 2001, al Qaeda assaults on the World Trade Center and Pentagon. The Bush administration has updated a much weaker 1980s-era standard, but government and congressional officials say the presumed attack still involves considerably fewer than 19 terrorists -- and that means requiring a smaller guard force than critics say is necessary.
A legal dispute related to this standard has now arisen, but -- as in other recent discussions of the administration's response to terrorism threats -- the squabbling is occurring almost entirely outside public view. The immediate issue is an unclassified request by a nuclear power plant operator for an exemption from certain parts of the new security requirements.
The Nuclear Regulatory Commission has deemed the operator's request sensitive, and declared that its release would bring criminal prosecution. Critics who allege the standards are already too lax have filed a challenge to the exemption request, which the commission has also declared is too sensitive to be released.
It is but one example of the manner in which post-Sept. 11 anti-terrorism controls -- even those concerning unclassified information -- have altered the landscape of public debate about security matters. Civil defense arrangements that were once the subject of mostly open rulemaking or debate are now often decided under a cloak of secrecy covering all but industry and government participants.
The result has been to complicate efforts to hold officials accountable for their decisions, especially in the counterterrorism field, say advocates of open policymaking. "There has been a proliferation of new controls on unclassified information," said Steven Aftergood, director of the Government Secrecy Project at the Federation of American Scientists. "This is where the public is at a disadvantage," because few mechanisms are available to challenge these controls or to ensure that public representatives have access comparable to what industry routinely gains.
In the nuclear site security case, Duke Power asked the NRC to waive certain security precautions, normally required wherever more than a bomb's worth of special nuclear materials are present. The request involves the planned shipment next spring of French-made nuclear fuel rods containing plutonium to its plants in North and South Carolina, where they will be stored and then burned in reactors.
The challenge has been filed by the Blue Ridge Environmental Defense League, with technical advice from the Union of Concerned Scientists. Although UCS scientist Edwin Lyman, who has a security clearance, read the exemption request after signing a non-disclosure statement, neither he nor the environmental group has been able to learn exactly what the NRC's security standards are.
Lyman says he is willing to keep whatever he learns confidential, but that without knowing more, he cannot fully assess the proposal or effectively express concerns about the underlying standard. But the NRC, ruling in a Feb. 18 decision, said that although Duke Power has a "need to know," the environmental group does not.
Rep. Edward J. Markey (D-Mass.), a longtime critic of nuclear power, has complained that the NRC barred the groups from learning the same information it shared not only with Duke Power but also with the Nuclear Energy Institute, an industry group that has lobbied against stiffer guard force requirements.
In a March 18 letter to the NRC, institute President Joe Colvin said the group was meeting "almost daily" with the commission staff to discuss the security standard, now undergoing a final government review. A senior NRC official, speaking on condition that he not be named, asserted that "the public does not have a need to know [the postulated terrorist threat] and doesn't, for the most part, have security clearances. . . . There is no way you can bring the public into that discussion." He said the critics "are unlikely to have anything but disdain for anything that we do, so I don't know what we can gain from that." Duke Power maintains that its power plants are well protected, and that its security exemption request is reasonable, given the difficulty of diverting plutonium contained in the bulky fuel rods. Nuclear Energy Institute Vice President Steve Floyd is skeptical of the critics' demands for even controlled access to threat information. "You have to realize what their agenda is -- to drive costs up to the point where nuclear [power] is no longer feasible," Floyd said.
But Aftergood of the Government Secrecy Project said that "it is the public that has to deal with the consequences" of a nuclear site security breach, and so it is entitled to participate more fully in the debate. "Fundamentally, the NRC policy views members of the public as a threat," Aftergood said.
The NRC is not alone in imposing its own, new controls on unclassified information. The Department of Homeland Security has promised not to disclose security data furnished by companies on their "critical infrastructure or protected systems," a potentially broad category of data.
The Federal Energy Regulatory Commission has adopted a slightly different policy to shield what it calls critical "energy infrastructure" data: It will release the data to recipients who sign a non-disclosure pledge. These and other government offices are essentially taking their cues from a White House directive in March 2002, which encouraged government officials to treat all unclassified security-related information as sensitive data not subject to public release.
But the NRC policy is one of the most expansive. The commission recently threatened staff members at a watchdog group, the Project on Government Oversight (POGO), with criminal prosecution because they published their own detailed critique of security at Entergy Nuclear's two reactors at Indian Point in New York.
"The Commission is concerned that a public discussion of some of those issues would not be in the best interests of the United States," NRC Secretary Annette L. Vietti-Cook wrote to the group in the fall, noting problems related to discussion in the critique of the number of attackers a plant might have to fend off and particular security weaknesses.
Roy P. Zimmerman, director of the NRC's office of nuclear security, subsequently wrote that POGO's critique -- which the group says was based solely on interviews it conducted with people who participated in or observed Indian Point security drills -- had been deemed "safeguards information" protected by federal law. Such laws, he noted, apply to "any person . . . who produces, receives, or acquires" such data, no matter how they got it.
In an apparent Catch-22, Zimmerman said the commission could not, however, specify what information it wanted deleted from the critique. That prompted POGO's lawyer, David C. Vladeck, to allege that the NRC was trying to "silence" the group. Eventually, the NRC, which denied the accusation, agreed to describe the offending information in general terms, and POGO released a new critique containing passages it had rephrased.
But, in an illustration of the challenges the government faces in trying to quash public discussion of sensitive but unclassified information, the original POGO critique remains posted on an independent Web site devoted to disseminating whatever officials seek to censor (www.thememoryhole.org).
Since Sept. 11, 2001, many bureaucrats have been using heightened security concerns to "hide their inadequacies," said Danielle Brian, POGO's executive director. "It has gone far, far beyond what is reasonable."
Aftergood similarly warns that the government has "cast too broad a net and . . . failed to provide an internal self-check." The sole office for policing the government's disclosure of security-related information was created in an era when data were either classified or subject to public release, and has no jurisdiction over the burgeoning realm of sensitive but unclassified information, he said.
J. William Leonard, who heads that office -- the Information Security Oversight Office, an arm of the National Archives -- confirms Aftergood's account. Although making no comment on specific disputes, he said that in many instances, "sensitive but unclassified" is a label without meaning that is misused by officials who lack the proper "training, background or understanding" to decide what to withhold. Leonard said that strictly applying a "need to know" test can sometimes exclude important players whose valuable insight is not foreseen.
Leonard gave a speech last year that he says is still relevant, in which he noted that the government needs to create "a seamless process" for sharing or withholding information, yet "we are . . . quite possibly adding new seams every day" by not enforcing a reasonable, government-wide policy.



? 2004 The Washington Post Company
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Full text
List of nuclear weapon accidents released by the MoD: part 1
List of nuclear weapon accidents released by the MoD: part 2
List of nuclear weapon accidents released by the MoD: part 3
List of nuclear weapon accidents released by the MoD: part 4
See the ombudsman's report (pdf)
http://politics.guardian.co.uk/foi/story/0,9061,1061755,00.html

MoD catalogues its nuclear blunders

Ombudsman forces disclosure of list of mishaps from 1960 to 1991 in which weapons were dropped or their carriers had road accidents
Rob Evans
Monday October 13, 2003
The Guardian
British nuclear weapons have been repeatedly dropped, struck by other weapons, and on one occasion carried on a truck that slid down a hill and toppled over, the Ministry of Defence has admitted after decades of secrecy.
The department has been forced to publish a list of 20 accidents and mishaps with nuclear weapons between 1960 and 1991, following a critical verdict from the parliamentary ombudsman.
No incidents have been reported since then. The list shows that trucks carrying nuclear weapons on British roads overturned on two occasions, and cars crashed into two convoys.
Nuclear weapons were dropped or fell on four occasions, and other munitions struck the atomic weapons four times. Four of the incidents happened abroad, in Germany, Malta and near Hong Kong.
Sir Kevin Tebbit, the MoD's permanent secretary, has had to disclose the list following a six-year "open government" campaign by the Guardian. The MoD initially blocked the request submitted in 1997, prompting the newspaper to lodge a complaint with the ombudsman, Ann Abraham.
Finding the MoD guilty of maladministration, the ombudsman dismissed its objections and ruled that disclosing the information would not endanger the security of the nation. She also criticised the ministry for the "inordinate delay" in releasing the list.
One accident hushed up by the MoD was in 1960 in Lincolnshire. According to the MoD, "an RAF nuclear weapon load carrier, forming part of a convoy, experienced a brake failure on an incline and overturned". The MoD gives no other details, but insists "there was no damage to any nuclear weapon".
Three years later, on the border of Lincolnshire and South Yorkshire, there was another "brake failure on a nuclear weapon load carrier". The MoD does not give further details, but again says no weapons were damaged. Another brake failure happened in June 1985 near Glasgow.
Since Britain started making nuclear weapons in the early 1950s, convoys have regularly transported missiles hundreds of miles on motorways and other roads from bases to the atomic weapons factories at Aldermaston and Burghfield in Berkshire.
These convoys continue today, as the warheads have a very short shelf-life and constantly have to be refurbished and rebuilt to keep them safe.
Frank Barnaby, a nuclear physicist who worked at Aldermaston in the 1950s, said: "To have three brake failures frankly surprises me. A well-maintained convoy should not have brake failures." He said that the designs of Britain's early nuclear weapons, from the 1950s and 1960s, were unsafe and primitive, and that the MoD was "lucky" to have got away with not having more serious accidents, including nuclear explosions.
He added: "The fact is that the early bombs were not safe until the safety features in the more modern weapons were installed. They were not safe [enough] to be subjected to severe shock."
The MoD insists the accidents never caused radiation leaks. "There has never been an occurrence involving a British nuclear weapon which represented a threat to public safety or to the safety of service personnel."
Shaun Gregory, a Bradford University academic who has studied the dangers of nuclear accidents, said that the MoD's descriptions of the incidents had the "appearance of being a sanitised version" of events and did not ring true. "Any type of complex system is bound to run into trouble," he said.
He believed that there was little chance of a nuclear detonation, but an accident could have caused a fire or explosion which could have showered radioactive debris around the immediate area. He pointed out that the US had released the documents and reports of accidents with their nuclear weapons under the country's freedom of information act. These reports had shown how military staff had panicked during those events.
There have been at least two accidents with US nuclear weapons on British soil, both at Lakenheath in Suffolk. In 1956, a bomber careered out of control and ploughed into a bomb dump housing three nuclear weapons, tearing it apart. The bomber exploded and threw burning fuel over all three nuclear weapons. One official US cable reported that it was a "miracle" that one bomb with "exposed detonators" did not explode.
In 1961, a warplane loaded with a nuclear bomb caught fire, leaving the weapon "scorched and blistered".
For decades, the MoD refused to disclose any information on nuclear accidents, as it did not want to confirm or deny presence of weapons at any particular time or place. But the ombudsman decided that national security could not be compromised, as the weapons in the accidents had been taken out of service.
She wrote : "It is therefore difficult to envisage the release of information about events that happened some time ago to weapons that no longer exist could cause harm if made more widely available."
Mr Barnaby said: "The intense secrecy was an absurdity. It does not affect national security. It is just an embarrassment which would make people more hostile to nuclear weapons."
The MoD's list is based on incomplete records. From military sources, the Guardian has learnt of three other mishaps. In 1988, a WE177 nuclear bomb was dented after it was dropped at RAF Marham, Norfolk. Another WE177 fell off a workstand in 1976 at RAF Honington, Suffolk, while being loaded on to a plane. In 1967, a Vulcan bomber carrying a nuclear weapon was struck by lightning at RAF Waddington, Lincolnshire.
Only seconds away from disaster
Wiltshire 1987 Truck with two 950lb WE177 n-weapons skidded and rolled on to side; second truck also slid off road. According to MoD, minor damage only. Armed police sealed off site from protestors
Malta 1974 Two torpedoes fell on to WE177 on board HMS Tiger. 'Superficial scratching' said MoD, but torpedo blast could have detonated explosive in n-weapon, scattering radioactivity
Lincolnshire 1960 N-weapon truck had 'brake failure and overturned'; similar failure in 1963
Germany 1974 and 1984 WE177 dropped while loading on plane at RAF Laarbruch in 1974; another WE177 dropped at RAF Bruggen in 1984 - reportedly caused base to shut for period
At sea 1974 and 1981 Parts of Polaris casing 'compressed' onto missiles on board subs. Design modified
Firth of Clyde 1973- 87 Coulport arms depot: in 1973, Land Rover reversed into RAF convoy of Polaris warheads, 'minor damage' to truck; in 1977 Polaris missile dropped while lifted; MoD said it fell 'a few inches'; in 1987, missile hit trailer because of 'human error onpart of crane driver' and defective crane, according to MoD. After inquiry, 'substantial changes in management responsibilities, training and command and control'. On M8 near Glasgow in 1983, Polaris warheads convoy collided with car; in 1985 there was 'brake failure on carrier', according to MoD, and it bumped into one in front
M25 1991 RAF convoy had 'mechanical failure'; motorway was closed several hours while, it is thought, n-bomb was shifted from one truck to another
-------------------------------------------------------------------------

'Takfiris a new breed of 'Jihadis' emerging'
PTI[ MONDAY, MARCH 29, 2004 10:42:40 PM ]
WASHINGTON: A new breed of 'Jihadis', schooled in the North African Islamic doctrine known as Takfir wal Hijra, is posing acute threat to Europe, a media report said.
The Takfiris, suspected to have carried out the March 17 Madrid blasts killing 190 and injuring over 1900, are unfettered by many of the religious and ideological constraints that defined Islamic terrorism in the past, The Wall Street Journal reported.
These warriors, trained by Afghan veterans of al-Qaeda, think, recruit and operate differently from traditional Islamic networks.
For Europe, that makes the threat particularly acute. Unlike previous generations of radical Islamists, who put on long beards with orthodox postures, the newer generation of holy warrior blends in better. They are encouraged to lead a double life for the ultimate pursuit of Jihad, the report said.
"Outwardly, they pretend to lead a modern lifestyle," terrorism expert Magnus Ranstorp was quoted as saying in the report. "But deep inside they adhere to a pure medieval strain of Islam," he said.
Many Takfiris shave their beards and avoid mosques for security reasons. "Recruits conceal their true beliefs until the time is right," says Ranstorp.
-------------------------------------------------------------------------

Cops missing out on IP benefits

By Ben Charny
Staff Writer, CNET News.com
http://news.com.com/2100-7352-5181099.html
Story last modified March 29, 2004, 8:57 AM PST
SANTA CLARA, Calif.--With the growing use of Internet Protocol inside telephone networks, 911 operators could have life-saving information at their fingertips.
But those gathered here for the Spring 2004 Voice on the Net Conference & Expo warn that the nation's 2,300 emergency call centers are missing out on a technological breakthrough touted as on par with the invention of police car radios.
By upgrading to IP equipment, 911 calls could be accompanied by much more information, such as callers' medical records or maps of the inside of their homes. But tight state budgets and technological inertia will delay, likely for years, upgrades that 911 call centers need to make to the century-old radio technology they now use, industry executives and officials say.
It's a "case where the communications link is outstripping the ability of the network and the funding ability of the local agencies," said Robert Pepper, the Federal Communications Commission's chief of policy development. "It turns out to be a huge problem."
The concerns only add to the problems that the broadband phone industry has created for law enforcement. More immediate problems are meeting soon-to-be drafted mandates to wiretap Internet-based calls or to provide the location of someone dialing 911 via a broadband connection.
A representative of the Association of Public-Safety Communications Officials International had no immediate comment.
Broadband phone service, otherwise known as voice over Internet Protocol (VoIP), is the latest telephone technology to outpace the nation's law enforcers. The most recent was cell phones.
Police in only a small number of cities are now able to determine the location of someone calling 911 via a cell phone, even though the U.S. cell phone industry made the necessary technology available in 100 markets last year. In May, when carriers will have to offer so-called enhanced 911 everywhere, at least one-third of all rural police agencies won't be able to use the information, according to sources familiar with the situation.
VoIP is a technology for making phones calls using the most popular method for sending data from one computer to another. Internet telephony services typically promise consumers a smaller phone bill, largely because VoIP providers operate free of regulation.
Carriers are already embracing VoIP as a way to cut traffic costs on international and long-distance calls. VoIP eventually is expected to replace the public switched telephone network as big phone companies convert to IP-based fiber-optic networks.

-----------------------------------------------------------------------
Police 'let Madrid bomb suspects go'
By Isambard Wilkinson in Madrid
(Filed: 29/03/2004)
Spanish police were agonisingly close to foiling the Madrid train bombings, it was disclosed yesterday.
A car carrying the explosives used in the March 11 massacre was stopped by police but its Arab driver was fined only for a minor traffic offence, it was reported.
The boot of the Volkswagen was packed with 220 lb of industrial dynamite being transported to Madrid after it had been stolen from a coal mine at Aviles in northern Spain during the last week of February, the El Pais newspaper said.
The car, which had been stolen, was stopped by two Civil Guard patrolmen near Benavente, in the province of Leon, north of Madrid.
But their suspicions were not aroused when they checked the car's registration as the owner had not yet reported it missing. They failed to recognise that the driver was not the registered owner.
The driver was fined for a minor infringement and allowed to drive on. Three of the four bombing suspects are thought to have been in the car.
The car has now been found and traces of the dynamite used to bomb four packed commuter trains during the morning rush hour, killing 190 people and injuring more than 1,500 were found by forensic scientists in the boot.
The explosives were packed into haversacks and hold-alls at a house in the countryside 20 miles from Madrid the day before the bombing.
Police, who found the terrorists' safe house by tracing calls they had made on mobile phones, were yesterday still searching the building near the small, picturesque town of Chinchon. Officers claim that they found the fingerprints of two of the 12 people - nine Moroccans, two Indians and a Spaniard - facing provisional murder and terrorism-related charges following the attacks.
The fingerprints allegedly were those of Jalam Zougam, the owner of a mobile phone shop. and Abderrahim Zbakh, a chemistry graduate.
Zougam is said by investigators to have been one of the ringleaders of the Moroccan terrorist cell blamed for the attack and Zbakh, dubbed "Chemical Ali" by investigators, is believed to have made the luggage bombs.
Police found detonators and explosives similar to those used in the attacks at the house, Spanish newspapers quoted sources close to the investigation as saying.
A total of 20 suspects have been arrested and six are due in court today.


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

NATO chief says "some nuts to crack" in Russia relations
WASHINGTON : NATO's secretary general there were still "nuts to crack" in relations with Russia as the alliance expands eastward with the addition of seven new members, including three former Soviet Baltic republics.
NATO Secretary General Jaap de Hoop Scheffer said he did not believe the expansion would cause new tension with Russia but acknowledged there were problems over the Conventional Forces in Europe (CFE) treat which limits troop numbers in eastern Europe.
"There are some nuts to crack, of course," he said.
"When I say we have some nuts to crack it's, of course, Russian worries about the effectiveness of the CFE treaty. NATO worries about the Russians still having their forces in Moldova-Transdniestra and Georgia," he said.
Nevertheless, he said, "NATO needs a partnership with the Russians. It's in NATO's interest and at the same time it is in Russia's interest that we have a strong partnership."
De Hoop Scheffer said it was good sign that Russian Foreign Minister Sergei Lavrov plans to attend a meeting of the NATO-Russia Council in Brussels Friday, the same day NATO will formally welcome in its new members.
The NATO chief said he planned to visit Moscow in early April, and would see Russian Defense Minister Sergey Ivanov Monday at a Russia-NATO meeting on terrorism in Norfolk, Virginia.
De Hoop Scheffer spoke shortly before the seven new members deposited instruments of accession to NATO at a ceremony here, effectively expanding the alliance to 26 members.
The new members include four from the former East bloc -- Romania, Bulgaria, Slovakia and Slovenia -- and the Baltic states of Estonia, Lithuania and Latvia.
Admission of the Baltic countries has been the bitterest pill for Moscow to swallow.
Russian officials last week warned that Moscow might build up its nuclear forces in response to the expansion, and expressed concern over NATO air patrols over the Baltics, which de Hoop Scheffer said were set to begin Monday.
"Without doubt, NATO's expansion touches Russia's political, military and, to a certain extent, economic interests," Russia's top foreign ministry spokesman Alexander Yakovenko reaffirmed Monday in an official statement released in Moscow.
The statement underlined that the three states and Slovenia have not signed up to the CFE as they did not exist as independent nations when the treaty was signed. The limbo status could leave open the possibility of NATO stationing unlimited number of troops at Russia's western front.
Moscow also fears NATO air patrols over the Baltics will be used to spy on its territory.
De Hoop Scheffer said the decision to use NATO fighters to patrol the Baltics was fully explained to Lavrov when it was taken two weeks ago by the alliance's decision-make North Atlantic Council.
"At this very moment fighters are in the air to land at Lithuania airport very shortly," he said.
"It's NATO airspace and NATO airspace has always been patrolled and covered, which will always be the case when later today the alliance will be formally enlarged by seven new member states," he said.

- AFP
-------------------------------------------------------------------------

A Testing Time
Says The Economist:
Mr Badawi's choice of ministers next week, and his selection of office-holders within UMNO at the party's conference in June, will provide the first unambiguous test of his sincerity as a reformer. [via The Economist -- subscription required]
Abdullah needs to pass with flying colours. We'll see the results of the first part of the test tomorrow when he announces the new Cabinet lineup.
And Datuk Seri, how about proving The Economist wrong on this one:
There is one item on the opposition's agenda, however, that Mr Badawi seems likely to neglect.
So far, he has barely mentioned, let alone dismantled, the various repressive measures that Dr Mahathir employed to dampen dissent.
The government still controls the airwaves, potential critics have difficulty obtaining newspaper licences, opposition politicians are jailed without trial, protest rallies are banned.
As one activist points out, when the government's critics are cowed, the corruption and inefficiency Mr Badawi says he is battling are sure to thrive.
A report card with straight As definitely looks better than one tarnished with a stray F or two.



Bravo Badawi >>...?

Mar 25th 2004 | KUALA LUMPUR
From The Economist print edition
Dr Mahathir's old party has done better without him
Get article background
THE National Front coalition may have won every election since Malaysia's independence, but it has not won by such a crushing margin in decades. On March 21st, voters awarded it 90% of the seats in the national parliament, up from 77% in 1999. It also won control of 11 of the 12 state governments at stake, while its share of the popular vote rose from 57% to 64%. Meanwhile, the biggest opposition party, the Pan-Malaysia Islamic Party (PAS), retained only seven of the 27 national seats it held in 1999, was practically obliterated in one of the two states it had controlled, and held on to the other by the thinnest of margins. So were the voters endorsing the status quo, and rejecting criticism of the government? Not exactly: the result was a victory for the opposition's ideas, though not for its parties.
Dumbfounded opposition leaders are denouncing the conduct of the election and calling for a new one. They point to a study of the electoral roll conducted before the poll which found a worryingly high proportion of false or incomplete addresses, and untraceable or suspicious names--including 156 people registered at the same address. They also complain about the short campaign period, media bias, gerrymandering and lack of funds. Yet the opposition faced similar obstacles in 1999, and did much better.
Another explanation holds that voters from the country's Malay Muslim majority spurned PAS's dogmatic vision of an Islamic state in favour of the Front's more progressive approach. It is certainly true that Malay voters deserted PAS in droves in Kelantan and Terengganu, the two states it had won decisively in 1999. Many of them, especially women and the young, doubtless chafed at PAS's edicts banning rock concerts, encouraging modest dress, and separating the sexes in supermarkets and on beaches.
But the National Front, despite condemning PAS as reactionary zealots, itself takes quite a doctrinaire approach to Islam, especially in areas with lots of conservative Muslim voters. It matched PAS's call for an Islamic state with a declaration that Malaysia already was one. Just before the election, it tried to defuse PAS's campaign in favour of private Islamic education with an announcement that Malay students would have to study Arabic and the Koran in state schools. One National Front state government even encourages polygamy. A big selling point of Abdullah Badawi, the prime minister and National Front leader, is his degree in Islamic studies.
Mr Badawi was indeed an important factor in the election, but probably as much for his unsullied and gentlemanly reputation as for his Islamic credentials. He came to power only last October, upon the retirement of Mahathir Mohamad, the prime minister of 22 years. At the previous election, voters seem to have blamed Dr Mahathir both for the struggling economy and for the high-handed and corrupt ways of Malaysian officialdom. They also associated him with the unjust treatment of Anwar Ibrahim, finance minister and deputy to Dr Mahathir, who was sacked, jailed and beaten in 1998. By retiring before this election, Dr Mahathir deprived his critics of their most emotive issue.
By contrast, Mr Badawi, or "Pak Lah" as Malaysians affectionately call him, is a breath of fresh air. In his five months in office, he has launched a counter-corruption drive, called for an inquiry into the police force and scrapped an extravagant construction scheme. In the election campaign, too, he stole the opposition's thunder by promising humbler, cleaner and more responsive government.
PAS and Keadilan, a party founded by disgruntled supporters of Mr Anwar, dismiss Mr Badawi's soft spot for good governance as a campaign ploy. Dr Mahathir, too, they argue, sold himself as a reformer at first. What is more, the senior echelons of the United Malays National Organisation (UMNO), the main component of the National Front, are still packed with the sort of politicians that the electorate turned against in 1999.
Before this election, Mr Badawi's supporters argued that he did not yet have enough authority to overhaul UMNO or the government wholesale. He had, after all, been appointed deputy prime minister by Dr Mahathir and then inherited the premiership without an election. His thumping victory at the polls, however, should put such concerns to rest. So Mr Badawi's choice of ministers next week, and his selection of office-holders within UMNO at the party's conference in June, will provide the first unambiguous test of his sincerity as a reformer.
There is one item on the opposition's agenda, however, that Mr Badawi seems likely to neglect. So far, he has barely mentioned, let alone dismantled, the various repressive measures that Dr Mahathir employed to dampen dissent. The government still controls the airwaves, potential critics have difficulty obtaining newspaper licences, opposition politicians are jailed without trial, protest rallies are banned. As one activist points out, when the government's critics are cowed, the corruption and inefficiency Mr Badawi says he is battling are sure to thrive.


Copyright ? 2004 The Economist Newspaper and The Economist Group. All rights reserved.

Happy Nowrouz!

>> MULLAHWATCH - AHA?


Iran postpones UN nuclear inspection mission
Friday, March 12, 2004 - ?2004 IranMania.com
VIENNA, March 12 (AFP) - Iran has put off an inspection mission from the UN nuclear watchdog that was due to arrive in the Islamic Republic this week, Iranian ambassador to the international agency Pirooz Hosseini told AFP.
He said that "due to the approaching of the Iranian New Year we asked them to come later."
The ambssador said no new date had been set.
The delay comes as the watchdog, the International Atomic Energy Agency (IAEA), is debating at a board of governors meeting in Vienna a resolution that criticizes Iran for hiding parts of its nuclear program.
IAEA officials refused to comment on the inspection mission.
Iranian Foreign Minister Kamal Kharazi had threatened in Iran this week for the Islamic Republic to end cooperation with the IAEA unless it stopped being "influenced by the Americans".
Hosseini said the delay in the inspection mission was not politically motivated.
He said that people will be out of their offices, since when the Iranian new year begins next week "there are five or six days of official holiday and then schools are closed for 15 days and parents take off to be with their children."
But a diplomat close to the IAEA said "of course it's political", and added that "the delay in inspections will definitely slow down what the IAEA is trying to do."
The IAEA has since February 2003 been verifying with inspections whether Iran's nuclear program is peaceful, or devoted to secretly developing atomic weapons, as the United States has charged.
-----------------------------------------------------------------------
>> OUR FRIENDS EU HARDBALL?


EU warns Iran over human rights
Friday, March 26, 2004 - ?2004 IranMania.com
GENEVA, March 25 (AFP) -- The European Union warned Tehran on Thursday that it had seen little progress in Iran's human rights dossier, which Brussels has effectively made a precondition to improved trade ties.
The EU also openly admitted at the UN Human Rights Commission in Geneva that its policy of constructive engagement with Tehran on human rights was flagging.
"Unfortunately, the fourth round of our human rights dialogue with Iran has not taken place due to Iran's failure to confirm the dates agreed," Ireland's envoy Mary Whelan told the Commission on behalf of the EU presidency.
"We regret that overall we see little improvement in the human rights situation in the country," she added.
Despite some improvement in women's rights, Whelan underlined that violations of human rights "continue to be widespread" in Iran, including torture, disappearances after arrests, arbitrary detention and political and religious repression.
The EU also noted that a de facto moratorium on amputations in Iran, a criminal penalty under Islamic law, had not been respected, while public executions continued.
"The recent interference in the electoral process represents a setback for democracy and a general trend toward even more restrictions on the exercise of political rights and freedoms," Whelan charged.
The EU External Affairs Commissioner Chris Patten said in February, after elections in Iran were marred by a ban on many reformist candidates, that Brussels would be watching closely to see how the situation there evolved.
The EU promotes constructive engagement with the Islamic Republic, seeking dual-track talks on trade and political issues, in contrast notably to the United States which has labelled Tehran part of an "axis of evil."
But the talks have been on hold since June 2003 because of EU concerns about Iran's nuclear ambitions.

---------------------------------------------------------------------
>> MEANWHILE OUR RUSSIAN FRIENDS...
Russian Atomic Energy Minister to visit Iran
Thursday, March 25, 2004 - ?2004 IranMania.com
Tehran, March 24 (IranMania) -- According to Iran's State News Agency(IRNA) Chief of the Federal Atomic Energy Agency Alexander Rumyantsev is most likely to visit Iran in May, spokesman for the restructured Atomic Energy Ministry Nikolai Shingarev told Itar-Tass.
"Implementation of the scheduled construction of the first energy unit of Iran`s nuclear power plant in Bushehr will be discussed at the upcoming meeting of the chief of the atomic energy agency and the leadership of the Iranian atomic energy agency."
Meanwhile, "the text of the protocol on return of spent nuclear fuel with the nuclear power plant for storage and processing in Russia" is expected to be finally agreed at the Tehran meeting.
"Representatives of the Russian corporation TVEL will discuss "the commercial aspect of the return of spent nuclear fuel at a meeting with the Iranian side shortly," Shingarev emphasized. The company TVEL did not rule out "the meeting may be held in Tehran in the next two weeks."
Rumyantsev was initially planned to visit Iran last January, but the trip was postponed to March "for technical reasons."
Shingarev noted that new adjournment of the date of the trip of the atomic energy agency chief to Tehran "is caused by the resolution of organizational issues of the transfer of powers and functions of the abolished Atomic Energy Ministry to the Federal Atomic Energy Agency."
"This work will be mainly completed in the next six weeks," he remarked.


Moscow may help Iran build 2nd reactor
Thursday, March 25, 2004 - ?2004 IranMania.com
Tehran, March 24 (IranMania) -- According to Iran's State News Agency(IRNA) Russia may take part in the construction of a second reactor at Iran's Bushehr nuclear power plant, sources at the Russian Atomic Energy Ministry said.
According to the official, the general contractor involved in the Bushehr nuclear power plant project - Atomstroiexport, has already handed over to Iran preliminary feasibility studies concerning the construction of a second reactor at Bushehr.
The chief of the Federal Agency for Atomic Power, Alexander Rumyantsev said on Monday Russia`s plans regarding the Iranian nuclear power program remained unchanged, despite the ongoing reorganization of the Atomic Energy Ministry.
"Technical cooperation with Iran in nuclear power plant construction in Bushehr will go on," he said. "I see no causes that
might restrict our cooperation."
A supplementary protocol on the repatriation of spent nuclear fuel from Bushehr to Russia "will be signed soon." Rumyantsev said signing of the protocol had been delayed against a background of "certain financial aspects."
"Iran has asked for several months to study the technology of handling spent nuclear waste," Rumyantsev said, adding that "Iran had repeatedly confirmed the readiness to sign the protocol."
In the meantime Iran`s Ambassador to Russia, Gholam-Reza Shafei has told Tass in an interview that the Russian-Iranian protocol on he return of spent nuclear fuel from Bushehr nuclear power plant will be signed in Tehran or in Moscow in the near future. Cooperation between Iran and Russia, he said, is "absolutely transparent and is being carried in full compliance with international legislation and the applicable rules."
"In view of Iran`s signing of the supplementary protocol with the International Atomic Energy Agency and our commitment to the liabilities under the Nuclear Arms Non-Proliferation Treaty and the good political relationship with Russia we hope that Russian-Iranian cooperation in the field of nuclear power will go on developing," the Iranian ambassador said.
"Cooperation in building the first unit of Bushehr nuclear power plant is continuing. The reasons why construction work has fallen behind schedule will be discussed when a senior Russian official visits Iran shortly."
Ambassador Shafei noted that Russia and Iran had agreed to sign a protocol on the return of spent fuel to Russia. "Alongside this protocol a supplement must be signed to the comprehensive contract on the construction of the nuclear power plant`s first unit."
The two sides are in the phase of active coordination of these documents, to be signed in Tehran or Moscow soon. "
A second Bushehr reactor is a future project and more fundamental negotiations on it will follow," the Iranian ambassador said.

>> AHEM...WE WERE BORN YESTERDAY...

Nuke fuel repatriation protocol with Iran
Thursday, March 25, 2004 - ?2004 IranMania.com
Tehran, March 24 (IranMania) -- According to Iran's State News Agency(IRNA) a Russian-Iranian protocol on the return of spent nuclear fuel from Bushehr nuclear power plant will be signed in Tehran or in Moscow in the near future, Iran's Ambassador to Russia Gholam-Reza Shafei told Tass in an interview.
Cooperation between Iran and Russia, he said, is "absolutely transparent and is being carried out in full compliance with international legislation and the applicable rules."
"In view of Iran`s signing the supplementary protocol with the International Atomic Energy Agency and our commitment to the liabilities under the Nuclear Arms Non-Proliferation Treaty and the good political relationship with Russia, we hope that
Russian-Iranian cooperation in the field of nuclear power will go on developing," the Iranian ambassador said.
"Cooperation in building the first unit of the Bushehr nuclear power plant is continuing. The reasons why construction work has fallen behind schedule will be discussed when a senior Russian official visits Iran shortly."
Ambassador Shafei said Russia and Iran had agreed to sign a protocol on the return of spent fuel to Russia.
"Alongside this protocol a supplement must be signed to the comprehensive contract on the construction of the nuclear power plant`s first unit." The two sides are in the phase of active coordination of these documents, to be signed in Tehran or Moscow soon.
"A second Bushehr reactor is a future project and more fundamental negotiations on it will follow," the Iranian ambassador said.


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

Israeli report blasts intelligence
for exaggerating the Iraqi threat
By Dan Baron
JERUSALEM, March 28 (JTA) -- Israel's foreign intelligence services have come under public scrutiny with revelations they overestimated one major threat while underplaying another.
Hot on the heels of the testimony of former U.S. counterterrorism chief Richard Clarke accusing the Bush administration of ignoring pre-Sept. 11 U.S. intelligence reports because it was focused on Iraq, the Steinitz Report issued on Sunday blasted those in Israel who had pushed for the war on Iraq.
The 80-page report, compiled by the Knesset Subcommittee on Secret Services under lawmaker Yuval Steinitz, lambasted prewar assessments by Mossad and military intelligence officials that it was "very likely" Saddam Hussein had missiles with non-conventional payloads aimed at Israel.
That perceived threat prompted the Defense Ministry to issue millions of gas masks and order citizens to prepare sealed rooms, at a cost of millions of dollars.
"The military and political upper echelons are responsible for the mess-up," said the Steinitz Report, which charged Israeli intelligence analysts with overconfidence and oversimplification.
The report also said Mossad and military intelligence officials are in need of a major overhaul after they failed to track Libya's pursuit of weapons of mass destruction.
Libyan ruler Muammar Gaddafi abandoned the program in December in negotiations with the United States and Britain that were kept secret from Israel.
"The idea that a hostile nation like Libya, with an unpredictable leader like Gaddafi, was in the running to develop a militarized nuclear industry, without Israel getting the necessary advance warning from its intelligence service to act preventively or at least prepare accordingly, is -- to put it mildly -- intolerable," the report said.
"The prime ministers lack the proper tools that would afford them real oversight and orientation on the intelligence apparatus and building a real force for intelligence analysis."
Israel stayed on the sidelines of the Iraq war out of concerns its involvement would alienate the few U.S. allies in the Arab world.
But Israeli intelligence assessments were regularly fed to Washington.
"It is not inconceivable that assessments passed by an Israeli intelligence agency . . . to a friendly agency were bounced back and force, played a key role in that friendly agency's planning, and ultimately ended up with the agency where they originated in the form of an analysis by an altogether different agency. Such assessments would immediately be perceived as another authoritative body bolstering and verifying the original Israeli view," the report said.
Yet asked by reporters if Israeli intelligence might have misled the United States and its ally Britain as to Iraq's real capabilities, Steinitz was more circumspect.
"American and British intelligence services had much better access to Iraq by simply sitting in Kuwait and other locations, and by being able to fly almost freely over Iraqi soil," he said.
U.S. and British officials did not comment.
The Steinitz report did not recommend action against any specific intelligence officials. But it said military intelligence, which has swollen steadily in terms of manpower and funding since Israel's failure to foresee the Arab assault which opened the 1973 Yom Kippur War, should be cut down in size.
Unit 8200, the military intelligence codebreakers -- who, according to a recent report in the New Yorker magazine, tipped off the United States as to Iran's nuclear buildup -- should become a civilian agency, the report said.
Meanwhile, it called for the Mossad to be boosted. According to security sources, the spy agency has fallen into lethargy recently through a combination of military intelligence's wide reach and an over-reliance on cooperation with foreign agencies.
The Prime Minister's Office, which oversees all of Israel's intelligence agencies, said it would consider the recommendations.

? JTA. Reproduction of material without written permission is strictly prohibited.
-------------------------------------------------------------------------------------
NEWS ANALYSIS
One year after war in Iraq, results
are mixed -- and terrorism continues
By Leslie Susser
JERUSALEM, March 22 (JTA) -- When the United States launched its war on Saddam Hussein's regime in Iraq, Israeli planners were hoping for major strategic changes that would promote regional stability.
A year later, the results are mixed.
There have been some major strategic gains: potential nuclear threats from Iran and Libya have been reduced, the threat of Iraq and Syria joining forces in a land war on Israel's northeastern border has been removed, and on Israel's northern border, the Hezbollah terrorist group has been exercising newfound restraint.
But the hoped-for domino effect against terrorism and its sponsors has not materialized. The terrorist threat to Israel actually has grown, and the chances of peace with the Palestinians appear increasingly remote.
Much will depend on whether the United States sees through the regime-change process and creates a stable democracy in Iraq or withdraws in disarray, leaving behind a trail of chaos and resentment.
Though no weapons of mass destruction have been found in Iraq, Israeli experts still maintain that Saddam had advanced chemical and biological weapons' programs and that if left to his own devices, he would have obtained nuclear bombs sooner or later.
Israeli strategists argue that the fact that such developments were pre-empted by the war is a major strategic boon not only for Israel, but for the Western world as a whole.
The most unexpected strategic gain for Israel was the domino effect on Libya's leader, Col. Muammar Gadhafi. Days after Saddam's capture by American forces in December, Gadhafi announced his readiness to dismantle his weapons of mass destruction programs.
Israeli officials believe Gadhafi is genuine and that Libya can be removed from Israel's "threat map."
They maintain that had Gadhafi developed a nuclear capability, Israel and the West would have had to invest huge resources in developing a suitable response.
The same Israeli officials are far less sanguine about Iran's declared readiness to suspend its nuclear program. They believe the Iranians are playing for time. But they note that even if the Iranians go back on their promises, the war in Iraq has pushed back their nuclear timetable.
It also has created a framework for international monitoring of Iran's nuclear development. That is no small achievement, the Israeli officials say.
One of the Israeli military planners' greatest nightmares was the specter of massive Iraqi, Syrian and Jordanian tank forces rolling across the desert toward Israel's eastern border. This scenario was dubbed the "Eastern Front" problem, and it was one of the main reasons for Israel's huge tank build up, even after achieving peace with Egypt and Jordan.
The removal of Iraq from the equation makes the scenario totally unrealistic. Israel's military planners will be able to risk major cutbacks in land forces and already are considering which units they can do without.
There also is a significant political dimension to the Eastern Front's disappearance.
Prime Minister Ariel Sharon always had insisted on retaining the Jordan Valley, between the West Bank and Jordan, as an additional buffer against the Eastern Front.
That would have meant that any future Palestinian state would have had to settle for no more than 80 percent of the West Bank. Now that the Eastern Front no longer exists, Sharon can consider relinquishing the Jordan Valley and strengthening chances for a future territorial settlement with the Palestinians.
Saddam's elimination and the collapse of Eastern Front also has heightened Syria's weakness and isolation.
This already has led to overtures to Israel from Syria's President Bashar Assad, which Israel dismissed as insincere. But a weakened Syria may well make serious approaches for peace with Israel soon.
In addition, with Israel and the United States believing that the best hope for long-term peace in the Middle East is the overthrow of autocratic regimes and the spread of democracy, they could not but take heart from unprecedented criticism of the Assad regime and recent Kurdish riots in Syria. One group of protesters said explicitly that they had been inspired by the overthrow of Saddam to challenge the sister Ba'athist regime in Damascus.
Another gain for Israel is the restraint currently being exercised on its volatile northern border by Hezbollah.
The group has been defined by the United States as a terrorist organization on a par with Al-Qaida, and its members may fear that attacks on Israel could elicit massive Israeli retaliation -- with the backing of the United States.
So Hezbollah, with Iranian aid, has changed its modus operandi: Instead of sparking direct military exchanges with Israel, it is clandestinely sending agents into the West Bank and Gaza Strip to help promote terrorism there.
Indeed, in perhaps the greatest disappointment to Israeli policy makers, the Iraqi domino effect has not impacted the level of Palestinian terrorism.
In a recent interview with Israel's daily Ma'ariv, retired Maj. Gen. Amos Gilad, Defense Minister Shaul Mofaz's closest political adviser, declared that "the domino effect worked where it wasn't expected to, on Libya, and not where we hoped it would, on Arafat."
Ongoing Palestinian terrorism after the war in Iraq, and the sense that there was no one to talk to on the Palestinian side, led to Sharon's plan for unilateral disengagement from the Palestinians. The first step, outside of Israel's West Bank security barrier, is Israel's withdrawal from the Gaza Strip.
But both Israel and the United States feared that as in Iraq, a power struggle would ensue between different local factions. To ensure that the secular Palestinian Authority and not the fundamentalist Hamas takes control of Gaza after the Israeli withdrawal, Israel has been targeting Hamas and its leaders.
Monday's assassination of Hamas spiritual and political leader Sheik Ahmed Yassin was part of this policy. Israeli military intelligence estimates that this will weaken Hamas and reduce terrorism in the long term.
Other analysts, however, warn that in assassinating a cleric, Israel may have opened a wider front with the Muslim world -- precisely the kind of development the U.S.-led war in Iraq was meant to contain.
Whether terrorism against Israel declines will depend to some extent on the degree to which the United States manages to stabilize the situation in Iraq, Israeli analysts believe.
As far as its strategic impact on the region is concerned, they argue, the American story in Iraq is far from over.
This month's signing of a provisional constitution in Iraq should be a major achievement for the Americans, they say, but they fear that ongoing terrorism in Iraq still could disrupt Washington's plans for a model democracy.
And, they say, the way the struggle in Iraq between the United States and its terrorist opponents plays out could have major consequences for Israel and the region as a whole.
Leslie Susser is the diplomatic correspondent for the Jerusalem Report.


? JTA. Reproduction of material without written permission is strictly prohibited.
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China's Communists Fall Victim to Piracy
BEIJING - China's rampant copyright piracy has hit home for the ruling communists after police caught two people with 14,000 unauthorized copies of party handbooks.
The two books contain new rules on party relations with the Chinese public and are mandatory reading for the party's 68 million members, the official Xinhua News Agency said.
Police launched an investigation following a complaint by the party publishing house that illegal copies appeared on the market immediately after it issued the real thing in February.
A bookstore owner and a printer in the western city of Xi'an were caught and admitted printing copies because the books "have become best sellers and are profitable," Xinhua said.
The report didn't say whether any party members -- who are supposed to be moral role models -- tried to save money on their political obligations by buying pirated copies.
It didn't say what penalties the store owner and his printer might face.
China's thriving industry in product piracy churns out illegal copies of everything from software to DVDs of Hollywood movies to fake designer shirts.
Chinese leaders have launched repeated crackdowns, but foreign and Chinese manufacturers complain that violations are still widespread.


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Chirac Suffers Midterm Blow
French Deliver Rebuke of Government Policies in Regional Vote
By Keith B. Richburg
Washington Post Foreign Service
Monday, March 29, 2004; Page A18
PARIS, March 28 -- President Jacques Chirac and his ruling conservative party suffered a crushing defeat in regional midterm elections Sunday, with the opposition Socialists and their Green and Communist allies seizing control of the vast majority of regional councils. The results represented a sharp rebuke for the government, which has attempted to reform France's costly health care, pension and education systems.
Chirac's party was expected to lose control of a number of regional councils after its poor showing in last week's first round of voting. But the scale of Sunday's defeat immediately prompted speculation that Chirac's prime minister, Jean-Pierre Raffarin, could be replaced in a sweeping post-election cabinet reshuffle this week.
"It's not just a defeat," said Alain Duhamel, a veteran political analyst and commentator. "It's a disaster."
Results being tallied Sunday night showed the Socialists and their allies taking control of at least 21 of 26 regional governments. Nationally, the Socialists and their allies were winning almost 50 percent of the vote, compared with just 37 percent for the government and about 13 percent for the anti-immigration National Front party.
All last week, the French media had been filled with speculation that Chirac would keep Raffarin in a retooled government and let go of some of the more unpopular ministers. But Duhamel, among others, said Chirac might now feel pressure to replace Raffarin with Interior Minister Nicolas Sarkozy, whose crackdown on crime has made him France's most popular politician.
Also threatened were the government's unpopular attempts to cut the spiraling costs of France's generous pension system and other aspects of the welfare state. The government has said changes are necessary to make the French economy more dynamic. But the reforms, including an increase in the number of years a person must work to qualify for a pension and a planned reduction in some unemployment benefits, have prompted bitter and disruptive protests over the past two years by a wide range of workers.
Alain Juppe, the head of Chirac's ruling Union for a Popular Movement (UMP) party, insisted the reforms would continue. "The governing majority has suffered a serious defeat," he said in a speech to supporters. "Is it necessary to abandon the reforms launched by the Raffarin government? In conscience, I believe not. To abandon the reforms would be to condemn our country to paralysis and regression."
Raffarin, appearing subdued, said, "It is clear that the opposition has won this ballot." But, he said, "the reforms will continue simply because they are necessary."
Leaders of the victorious Socialist Party called the results a repudiation of Chirac's policies and said voters had demonstrated their trust in the Socialists to preserve the safety net of social services.
Citing the high turnout, Francois Hollande, the Socialist Party leader, said voters had "sent a clear message to our political leaders. They have rejected the policies which have over two years aggravated inequality."
The ruling party's defeat was underscored in some high-profile races. Poitou-Charentes, in western France, was long Raffarin's personal fiefdom, but on Sunday it was won by a Socialist, Segolene Royal, who received 55 percent of the vote. A conservative former French president, Valery Giscard d'Estaing, was handily defeated in his bid to become the regional president of Auvergne.
Regions have little real power, and turnout in the past has been low. But Sunday was the first time French voters had an opportunity to go to the polls since Chirac and the center-right swept to power two years ago, and many wanted to signal their dissatisfaction before the next elections for president and parliament in 2007.
"The results of the regionals are going to have a huge influence on the national government's policies," said Karim Khelifi, 43, a communications worker voting in a working-class neighborhood of Paris. "I hope that the left wins in many regions," he added. "That way, the government will be forced to come back to more humane social policies."
Special correspondent Pan Yuk contributed to this report.

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R?gionales : la d?b?cle de la droite
LEMONDE.FR | 28.03.04 | 20h02 * MIS A JOUR LE 29.03.04 | 01h57
La vague rose du premier tour des r?gionales s'est amplifi?e au second tour, dimanche, et la gauche se retrouve ? la t?te d'au moins 20 r?gions m?tropolitaines sur 22, contre huit avant le scrutin.
La majorit? UMP-UDF a subi une v?ritable d?route, dimanche 28 mars, au second tour des ?lections r?gionales. La gauche emporte au moins 20 r?gions sur les 22 de la France m?tropolitaine alors que la droite, qui en contr?lait 14 depuis 1998, n'en a plus que deux au maximum, l'Alsace et peut-?tre la Corse.
Le taux d'abstention, qui ?tait de 37,9 % au premier tour, est tomb? ce dimanche ? pr?s de 35 %. Cette plus forte mobilisation des ?lecteurs a profit? ? la gauche, qui recueille 50,37 % des voix (6 points de plus par rapport au premier tour), contre 37 % ? la droite (+ 3) et 13 % au Front national (- 2,5).
Cette victoire ?crasante de la gauche, qualifi?e d'"extr?mement spectaculaire" par l'ancien premier ministre PS Laurent Fabius, se traduit par le gain d'une dizaine de r?gions, sur les 13 que la droite d?tenait en m?tropole (hors Corse). Le premier secr?taire du Parti socialiste, Fran?ois Hollande, a, lui, parl? de"d?saveu s?v?re" du pr?sident Jacques Chirac.
"C'est d?sormais au pr?sident de la R?publique de tirer les le?ons de cette crise de confiance", a rench?ri le pr?sident de l'UDF, Fran?ois Bayrou.
"C'est un 21 avril [2002] ? l'envers", a d?clar?, de son c?t?, le ministre des affaires sociales, Fran?ois Fillon, en ?voquant "une d?faite extr?mement grave du gouvernement et de la majorit?". Le constat est identique pour le pr?sident de l'UMP, Alain Jupp?, qui estime que "la majorit? gouvernementale vient de subir un ?chec grave. (...) Nous devons entendre ce fort m?contentement".
D?FAITES CUISANTES
Symbole de cette situation, le Poitou-Charentes, fief du premier ministre, o? S?gol?ne Royal (PS) obtient 55,1 % des suffrages, soit 20 points d'avance sur Elisabeth Morin (UMP), successeur de M. Raffarin ? la r?gion.
Autre victime de ce raz-de-mar?e, l'ancien pr?sident Val?ry Giscard d'Estaing (UMP), battu de 5 points en Auvergne (52,65 % contre 47,5 %) par Pierre-Jo?l Bont? (PS).
D?faite cuisante aussi en Picardie pour le ministre UDF, Gilles de Robien, qui ne recueille que 35,7 % des voix contre 45,7 % ? la liste du PS Claude Gewerc.
La droite perd deux autres bastions, la Bretagne, o? le pr?sident sortant, Josselin de Rohan (UMP), est largement devanc? par Jean-Yves Le Drian (58 % contre 42 %), et la Franche-Comt?, o? Raymond Forni (PS) devance de 12 points Jean-Fran?ois Humbert (UMP).
Elu en 1998 avec les voix du Front national, Jacques Blanc (UMP) est battu de 15 points en Languedoc-Roussillon par le maire PS de Montpellier, Georges Fr?che.
REMANIEMENT EN VUE
Dans ce contexte, la gauche conserve ais?ment les huit r?gions qu'elle d?tenait d?j?, dont l'Ile-de-France, o? Jean-Paul Huchon (PS) devance le porte-parole du gouvernement, Jean-Fran?ois Cop? (UMP), d'environ 6 points.
Dans la r?gion PACA, le pr?sident sortant PS, Michel Vauzelle, devance de 11 points le secr?taire d'Etat UMP, Renaud Muselier.
M?me cas de figure en Aquitaine et dans le Nord - Pas-de-Calais, o? les sortants PS Alain Rousset et Daniel Percheron l'emportent avec environ 20 points d'avance sur les ministres Xavier Darcos et Jean-Paul Delevoye.
L'?chec de la droite place le pr?sident Jacques Chirac dans une position difficile, l'incertitude r?gnant plus que jamais sur l'ampleur du remaniement minist?riel ? venir et sur le possible d?part de Jean-Pierre Raffarin de Matignon. Un changement de strag?gie mettant davantage l'accent sur le social pourrait voir le jour.
"Des changements s'imposent certainement", a indiqu? M. Raffarin dans sa premi?re r?action publique apr?s les r?sultats, apr?s que des ministres ont admis la gravit? de la d?faite du gouvernement. Pour M. Raffarin, dont la popularit? est en chute libre, "l'action doit ?tre plus efficace, l'action doit ?tre plus juste". Rappelant son bilan au gouvernement en mati?re de lutte contre l'ins?curit? et le ch?mage ou de r?forme des retraites, il a reconnu que "ce n'est pas assez, je le sais, les Fran?aises et les Fran?ais nous l'ont dit aujourd'hui clairement".
Selon un sondage r?alis? cette semaine par la Sofres, ? para?tre lundi dans L'Express, 59 % des Fran?ais souhaitent le d?part de M. Raffarin, 29 % plaident au contraire pour son maintien tandis que 40 % veulent qu'il soit remplac? par Nicolas Sarkozy.
Lemonde.fr avec AFP et Reuters

Acheter les droits de reproduction

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Shiites Organize to Block U.S. Plan
Spurred by Sistani, Iraqi Clergy Mobilizes Followers Against Constitution
By Anthony Shadid
Washington Post Foreign Service
Monday, March 29, 2004; Page A01
BAGHDAD -- With the turban of the clergy and the talk of a politician, Hashem Awadi, a young Shiite Muslim cleric, thumbed through papers that described the latest challenge to Washington's political blueprint for Iraq.
Here, the gaunt, 38-year-old said, was a leaflet that enumerated the objections of Grand Ayatollah Ali Sistani, the country's most powerful cleric, to Iraq's interim constitution. This, he said, was the letter the ayatollah sent to the United Nations in protest. And here, displayed proudly, was the petition denouncing that constitution in what he said amounted to a "popular referendum."
"We want to make clear the will of the people," said Awadi, who heads the Ghadir Foundation, a religious institute in Baghdad that, by his count, has distributed as many as 10,000 of the petitions. "The people are burning."
Awadi, whose speech veers from Islamic law to Western freedoms, is one of the leaders of a vociferous grass-roots campaign unleashed by the edict published by Sistani's office March 8 questioning the legitimacy of the interim constitution.
In the weeks since, the vast network of Shiite Muslim mosques, religious centers, foundations and community organizations that make Sistani Iraq's most influential figure has led a campaign to amend the constitution or discard it. Posters have gone up at universities in Baghdad and elsewhere, leaflets have circulated among prayer-goers and Sistani's cadres -- from young clerics to devoted laymen -- have gathered tens of thousands of signatures on the petitions. Demonstrations are next, they warn.
"This is freedom of expression," Awadi said, thumbing yellow worry beads. "This is freedom of opinion."
The clergy's campaign is steeped in the religious symbolism that binds much of the country's Shiite majority, whose political ascendancy is a defining feature of postwar Iraq. It turns on a term -- legitimacy -- that is far easier to deny than to bestow. The campaign signals a willingness to confront U.S. authorities at a moment when time is short, as the American administration prepares to formally end the occupation on June 30 and turn over authority to an interim Iraqi government.
Sistani's edict was never uttered aloud. The reclusive, 73-year-old cleric did not deliver it publicly. But the statement -- six lines penned in the meticulous handwriting of Sistani's son -- was enough to seriously imperil a document American and Iraqi leaders have hailed as a model for the Arab world and the clergy have denounced as the work of an unelected body unduly pressured by U.S. officials.
Sistani's followers make clear that their campaign is not simply driven by the hope of altering the constitution. In a country where pledges of democracy are not yet supported by representative institutions, religion is by far the best-organized force. Its leadership views the constitution as an opportunity to mobilize the still unfulfilled potential of the country's Shiite majority.
"For a long time, we had lost our rights," said Saad Taher, 40, a community activist and municipal worker, sitting in a tailor's shop in the religiously mixed neighborhood of New Baghdad. "We're trying to help the people to take their rights back."
The room, a dingy second-floor workshop that overlooks a teeming street market of rickety stalls, is the headquarters of Taher's Committee of Heavenly Books, one of an abundance of Shiite community groups that have sprung up since the fall of Saddam Hussein's government on April 9. Most have names imbued with religious imagery, like the Committee of Rescue Ships or Committee of the Followers of Hussein, Shiite Islam's most beloved saint. Most are long on devotion and short on money.
"We're from the people," Taher said. "We're the children of this neighborhood."
With about 400 members, the committee has worked on the front lines of the constitutional campaign. Taher and his co-director, Talal Jaafari, a vendor in the market outside, meet every day in the workshop with five or 10 of the most committed.
For the past week, they have gone to universities, to Shiite community centers known as husseiniyas, to mosques and door to door with the petitions, which describe the constitution as illegitimate and list objections that run from the document's liberal definition of citizenship to the power of an unelected government to make lasting decisions. So far, the two men have completed more than 400 petitions, each with 15 signatures, along with a name, address, occupation and birth date.
Some were reluctant to sign, fearing political involvement that, until a year ago, was particularly dangerous, Taher said.
"But we've overcome our fear," he said, smiling. "Thank God and praise him."
"We've come to the point where others are scared of us," a friend, Jassem Qureishi, said, drawing laughs from the group.
"America has a term: the rebuilding of Iraq," Taher said, sitting along a wall crowded with religious portraits and a tailor's tools. "We are rebuilding ourselves. We want to create a new Iraqi personality. That's our task. That's not the Americans' task."
Asked about the next step the group plans in the campaign, Taher answered succinctly.
"We take our instructions from Sheik Sahib," he said.
Lieutenant in Baghdad
Sheik Sahib Abdullah Warwar Qureishi is a wakil, or religious representative. He is one of about 200 in Baghdad who answer to Sistani, many of them providing the organizational power behind the campaign's momentum.
Unlike many of the wakils, Qureishi is young, his bushy beard making him appear older than his 34 years. But he has spent more than a decade as a seminary student in the Shiite holy city of Najaf, where Sistani has his headquarters. His words come slowly and are often unexpectedly cheerful, in the mentoring tone of a teacher.
"We refuse the constitution in its entirety and its details," he said, sitting under three shelves full of law books.
Qureishi is responsible for a sprawling swath of New Baghdad known as the Gulf neighborhood, which is majority Shiite. More than 70,000 people live there, and the area has 10 husseiniyas and 12 mosques. Qureishi spends half the week in Najaf, where he visits Sistani's office daily. On his three nights in Baghdad, he teaches three one-hour courses to about 37 students who, along with the activists of the Committee of Heavenly Books, have become the foot soldiers in the petition campaign.
On this night, six stacks of petitions were laid out in front of him, spread like a feast.
"For 35 years, Najaf could never lift its head. The people couldn't breathe," he said, as the ceiling fan blew the scent of burning incense across the room. "Now we speak as we like, we worship as we like. What we have now feels like democracy."
Until late in the night, students and activists streamed into his small brick house, bordered by three palm trees, with pools of sewage outside. Each carried a bundle of petitions. Over the past week, he estimated, he had gathered at least 6,000 petitions with 90,000 signatures. Every day or so, he has the documents scanned onto a computer disc and sent to Sistani's office in Najaf.
"We had more than 1,000, and it wasn't enough," said one activist, Qassim Hassan, 42, as he entered the home.
"If you need a billion, I'll give them to you," Qureishi told him.
Kadhim Atshan, a member of the committee, said a third of the people wanted to sign with pens dipped in their own blood.
Qureishi shook his head. Sistani, he said, "has refused people doing this. He said it's disgusting, and he doesn't accept it."
Sitting together on red carpets, their backs against pillows along the walls, the men talked about what they considered the constitution's faults.
The campaign already resembles a movement led by Sistani against a U.S.-devised plan for Iraq's transition, announced Nov. 15, calling for regional caucuses that would choose a transitional government. A month later, Sistani made his reservations to the plan public. By February, amid popular opposition, the U.S. administration was looking for an alternative that has yet to be decided.
In both campaigns, the question was who would decide Iraq's political future and under what authority.
Iraq's U.S.-appointed Governing Council, which negotiated and signed the interim constitution on March 8, "doesn't represent the majority of the people," Qureishi said. "They must represent themselves." He turned the discussion to the U.S. occupation, as the men listened patiently. "The coalition forces didn't come for your interests or my interests," he said, wagging his finger, "not at all."
"The solution is for you to vote, for me to vote, for him to vote," he said, pointing to those gathered. "That's the solution."
The enthusiasm grew. At one point, electricity was cut and the lights went out. Most of the men pulled out lighters. The conversation never missed a beat. Some of the youngest of the sheik's followers pleaded for more direct action. "The shortest distance between two points is a straight line," said Jawad Rumi, 33. "The shortest distance from Earth to Heaven is jihad."
Over tea and cigarettes, other men spoke up, addressing the sheik or their colleagues, and nearly all seemed to have read the law. One pointed out the constitution's provision for Iraqis to reclaim citizenship. Several pointed out that the provision would allow Iraqi Jews who left for Israel in the 1940s and 1950s to return. "It will let the Israelis do as they like in Iraq," Jaafari said to the nods of others.
What about Iraqi armed forces remaining under U.S. control in the interim? one man asked. Why wasn't the constitution put to a vote? asked another. Others objected to a three-member presidency that would allow a vice president, likely a Sunni Arab or Kurd, to overrule a presumably Shiite president -- a clause that U.S. officials and some Iraqi leaders describe as essential for protecting minority rights.
The sheik spoke up again. From a poster embossed with red and black type on a blue background, he pointed out what he said was his biggest objection: a provision that gives Kurds an effective veto over the permanent constitution to be written next year.
"This decision was imposed on us," Qureishi said.
'They're Ready to Act'
The poster the sheik read from has gone up in many parts of Baghdad. It bears a picture of Sistani, with flowing beard and turban, reading from a book. In large type, it asks, "What do you know about the Iraqi State Law for the Transitional Phase?" It was published by the Najaf-based Murtada Foundation which, like Awadi's Ghadir Foundation, is among the handful of institutions that are nominally independent but under the loose supervision of the offices of Sistani and other senior ayatollahs.
The literature is ubiquitous -- in husseiniyas and mosques, on the walls of universities and in markets. Qureishi, the sheik, had foot-high stacks of the group's leaflets and interviews, piled next to blank petitions. At a mosque in a nearby neighborhood, banners along the walls copied the slogans: "Any law not ratified by a nationally elected group will not be legitimate."
Jassim Jazairi, a 35-year-old cleric in a black turban, runs the branch of the Murtada Foundation on Baghdad's Palestine Street, one of two in the capital. On his untidy desk were 170 petitions, marked either with signatures or with the thumbprints of the illiterate. Alongside them were copies of an interview with "a source close to" Sistani, reprinted from the foundation's magazine, Holy Najaf. Next to those was a red Koran.
"Even now, when we hold forums and we talk about [Sistani's] reservations, the people almost respond with violence," Jazairi said. "They're emotional, and they're ready to act."
Jazairi predicted that protests would come next, to force amendments to the constitution. He insisted they would stay nonviolent -- "peaceful resistance," as he put it. To him, they were another step in the politicization of the Shiite community, led by the clergy.
"We lost so much over 35 years of repression," he said. "The fear remains, and it still affects Iraq's people. We want to restore people's confidence in themselves. We want them to know they can change the political situation they face."


? 2004 The Washington Post Company
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Iraqi Minister Escapes Assassination
2 hours, 31 minutes ago
By CHRISTOPHER TORCHIA, Associated Press Writer
BAGHDAD, Iraq - Gunmen opened fire Sunday on a convoy carrying Iraq (news - web sites)'s minister of public works, killing a driver and a bodyguard and injuring two others, the U.S.-led coalition said. The minister, Nisreen Berwari, was unharmed.
In another attack in the same city, Mosul, gunmen killed a Briton and a Canadian who were working as security guards for foreign electrical engineers at a power station. The ambush appeared to be part of a campaign to undermine U.S.-led reconstruction efforts in Iraq.
The attacks highlighted the tenuous security situation in Iraq's third-largest city, once a prime recruiting ground for the officer corps of Saddam Hussein (news - web sites)'s military.
Berwari was returning to Mosul from a meeting in the city of Dohuk when her convoy was attacked, said Kristi Clemens, a coalition spokeswoman in Baghdad.
Saro Qader, an official with the Kurdistan Democratic Party, described the attack as an "assassination attempt." Berwari is a member of the Kurdish party.
Iraqi police said the attack occurred around 11 a.m. in the al-Karama neighborhood of Mosul. They said the two men who were killed were both bodyguards, and that Berwari was in another car that was not hit by gunfire.
Berwari, who earned a degree at Harvard University's John F. Kennedy School of Government in 1999, is one of five Kurdish ministers in the coalition-appointed interim government. There are 20 other ministers.
Previously, Berwari was development minister in the Kurdistan regional government, and she also served with United Nations (news - web sites) organizations in Iraq.
Another female political leader, Aqila al-Hashimi, was assassinated in September. She was a Shiite member of the U.S.-appointed Iraqi Governing Council.
The slain Briton and Canadian had been assigned to protect foreign engineers working for General Electric Co., a coalition spokesman said on condition of anonymity. GE is helping rebuild Iraq's decrepit electrical infrastructure, which has suffered from war, neglect and years of sanctions. Power blackouts are frequent.
U.S. soldiers and Iraqi police sealed off the area after the shooting. Witnesses saw two partly burned bodies, clad in flak jackets, lying beside a four-wheel drive vehicle that was on fire. One man had been shot in the head.
In London, the Foreign Office said one Briton was killed. In Ottawa, the Canadian Foreign Ministry said a Canadian died. Their names were not released.
An Iraqi official at the power station in East Mosul said the slain men were protecting experts working at the station. Private security firms provide guards to many foreign companies operating in Iraq.
This month, assailants have killed other Western civilians linked to reconstruction efforts: four American missionaries working on a water project in Mosul, two Finnish businessmen in Baghdad, a German and a Dutch national working on a water project south of Baghdad, and two American staffers with the coalition shot south of the capital.
U.S. military officials in Mosul say insurgents are shifting from attacks on American troops to targeting Iraqi security forces, and most recently civilians. The shift could be partly because there are fewer American soldiers in the area, and consequently fewer U.S. targets.
The U.S. military, however, says rebels are choosing civilians targets because they are frustrated at a lack of success in attacking soldiers.
Late last year, some 20,000 soldiers with the U.S. Army's 101st Airborne Division occupied Mosul and surrounding areas. Since the 101st pulled out in February, the region around Mosul has been occupied by 8,000 U.S. troops under Task Force Olympia, which lacks the 101st's fleet of helicopters.
The new forces in the north have cut back on the number of economic development and infrastructure projects undertaken by the 101st.
In other violence in Mosul on Sunday:
_ Iraqi police said two U.S. soldiers were wounded after gunmen in a car opened fire on their military vehicle. The U.S. military said troops returned fire, killing all four "enemy forces" in the car.
_ A U.S. military Stryker vehicle caught fire after being struck by a rocket-propelled grenade, but there were no injuries, the U.S. military said.
_ Gunmen exchanged fire with Iraqi police guarding the main gate of the television station. Two policemen were injured, and the attackers fled.
_ A rocket, possibly aimed at a police station a block away, hit a classroom at a primary school while a lesson was in progress. It failed to explode, and no pupils were injured.
In Baghdad, U.S. soldiers shut down a weekly newspaper run by followers of radical Shiite Muslim cleric Muqtada al-Sadr, saying its articles were inciting violence against the coalition. The Al-Hawza newspaper will be closed for 60 days, the coalition said. Hours later, 1,000 followers of al-Sadr demonstrated against the closure, saying it violated freedom of expression.

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The Holocaust Shrug
From the April 5, 2004 issue: Why is there so much indifference to the liberation of Iraq?
by David Gelernter
04/05/2004, Volume 009, Issue 29
I HEAR AND READ ALL THE TIME about Democratic fury; evidently, enraged Democrats are prepared to do whatever it takes to rid the country of George W. Bush's foul presence. Somehow Republican rage doesn't seem quite as newsworthy (and when it does show up, the storyline is usually "Republicans Angry at Bush"). To be fair, Republicans do control the presidency and both houses of Congress, and ought to be far gone in euphoria. But they are not. There are lots of unhappy and quite a few furious ones out there, and they are not all mad at the president. Some reporters will find this hard to believe, but quite a lot of them are actually mad at the Democrats.
Consider Iraq. By overthrowing Saddam, we stopped a loathsome bloody massacre--a hell-on-earth that would have been all too easily dismissed as fantastic propaganda if we hadn't seen and heard the victims and watched the torturers on videotape. Now: There is all sorts of latitude for legitimate attack on the Bush administration and Iraq. A Bush critic could allege that our preparation was lousy, our strategy wrong, our postwar administration a failure, and so on ad infinitum . . . so long as he stays in ground-contact with the basic truth: This war was an unmitigated triumph for humanity. Everything we have learned since the end of full-scale fighting has only made it seem more of a triumph.
But Democratic talk about Iraq is dominated not by the hell and horror we abolished or the pride and joy of what we achieved. Many Democrats mention Saddam's crimes only grudgingly. What they really want to discuss is how the administration "lied" about WMDs (one of the more infantile accusations in modern political history), how (thanks to Iraq) our allies can't stand us anymore, how (on account of Iraq) we are shortchanging the war on terror. But don't you understand, a listener wants to scream, that Saddam's government was ripping human flesh to shreds? Was consuming whole populations by greedy mouthfuls, masticating them, drooling blood? Committing crimes that are painful even to describe? Don't you understand what we achieved by liberating Iraq, what mankind achieved? When we hear about Saddam and his two sons, how can we help but think of the three-faced Lucifer at the bottom of Dante's hell?--"with six eyes he was weeping and over three chins dripped tears and bloody foam," Con sei occhi piangea, e per tre menti / gocciava 'l pianto e sanguinosa bava, as he crushes human life between his teeth.
I could understand the Democrats' insisting that this was no Republican operation; "we were in favor of it too, we voted for it too, and then voted more money to fund it; we want some credit!" Those would be reasonable political claims. But if you talk as if this war were one big, stupid blunder that we are stuck with and have to make the best of--you are nowhere near shouting distance of reality; people would suspect your sanity if you were not a politician already. Instead of insisting that the war belongs to them, too, Democrats are running top speed in the other direction. Howard Dean led the way on this flight from duty, honor, and truth, but it didn't take long for most of the nation's prominent Democrats (with a few honorable exceptions) to jump aboard the Dean express--which is now, absent Dean, a runaway train.
People ask, why this big deal about Saddam? "Isn't X evil too, and what about Y, and how can you possibly ignore Z?" But we aren't automata; we are able to make distinctions. Some evil is beyond our power to stop. That doesn't absolve us from stopping what we can. All cruelty is bad. Yet some cruel and evil men are worse than others. By any standard we did right by overthrowing Saddam--and do wrong by denying or belittling that fact.
The Democrats' refusal to acknowledge the moral importance of the Coalition's Iraq victory felt, at first, like the Clinton treatment--more relativistic, warped-earth moral geometry in which the truth gradually approaches infinite malleability. Overthrowing vicious dictatorships and stopping crimes against humanity were no longer that big a deal once Republicans were running the show. It seemed like the same old hypocrisy, sadly familiar. (I will even concede, for what it's worth, that Republicans can be inconsistent and hypocritical too.)
But as we learned more about Saddam's crimes, and Democrats grew less convinced that the war was right and was necessary . . . their response took on a far more sinister color. It started to resemble the Holocaust Shrug.
I SUGGEST ONLY DIFFIDENTLY that the world's indifference to the Coalition's achievement resembles its long-running, well-established lack of interest in Hitler's crimes. I don't claim that Saddam resembles Hitler; I do claim that the world's indifference to Saddam resembles its indifference to Hitler.
The Holocaust was unique--"fundamentally different," the German philosopher Karl Jaspers wrote, "from all crimes that have existed in the past." Hitler's mission was to convert Germany and eventually all Europe into an engine of annihilating Jew-hatred. He tore the heart out of the Jewish nation. There is nothing "universal" or "paradigmatic" about the Holocaust, and next to Hitler, Saddam is a mere child with a boyish love of torture and mass murder.
Yet Saddam, like Hitler, murdered people sadistically and systematically for the crime of being born. Saddam, like Hitler, believed that mass murder should be efficient, with minimal fuss and bother; it is no accident that both were big believers in poison gas. Saddam's program, like Hitler's, attracted all sorts of sadists; many of Saddam's and Hitler's crimes were not quite as no-fuss, no-muss as the Big Boss preferred. Evidently Saddam, like Hitler, did not personally torture his prisoners, but Saddam (like Hitler) allowed and condoned torture that will stand as a black mark against mankind forever.
Hitler was in a profoundly, fundamentally different league. And yet the distinction is unlikely to have mattered much to a Kurd mother watching her child choke to death on poison gas, or a Shiite about to be diced to bloody pulp. The colossal scale and the routine, systematic nature of torture and murder under Saddam puts him in a special category too. Saddam was small compared with Hitler, yet he was like Hitler not only in what he wanted but in what he did. When we marched into Iraq, we halted a small-scale holocaust.
I could understand people disagreeing with this claim, arguing that Saddam was evil but not that kind of evil, not evil enough to deserve being discussed in those terms. But the opposition I hear doesn't dwell on the nature of Saddam's crimes. It dwells on the nature of America's--our mistakes, our malfeasance, our "lies." It sounds loonier and farther from reality all the time, more and more like the Holocaust Shrug.
Turning away is not evil; it is merely human. And that's bad enough. For years I myself found it easy to ignore or shrug off Saddam's reported crimes. I had no love for Iraq or Iraqis. Before and during the war I wrote pieces suggesting that Americans not romanticize Iraqis; that we understand postwar Iraq more in terms of occupied Germany than liberated France. But during and after the war it gradually became impossible to ignore the staggering enormity of what Saddam had committed against his own people. And when we saw those mass graveyards and torture chambers, heard more and more victims speak, watched those videotapes, the conclusion became inescapable: This war was screamingly, shriekingly necessary.
But instead of exulting in our victory, too many of us shrug and turn away and change the subject.
Young people might be misled about the world's response to the Holocaust by the current academic taste for "Holocaust studies" and related projects. It wasn't always this way.
In the years right after the war, there was Holocaust horror all over the world. The appearance of such books as Elie Wiesel's Night and Anne Frank's diary kept people thinking. But after that, silence set in. In 1981 Lucy Dawidowicz, most distinguished of all Holocaust historians, wrote of "this historiographical mystery of why the Holocaust was belittled or overlooked in the history books." I remember the 1960s (when I was a child growing up) as years during which the Holocaust was old stuff. On the whole, neither Jews nor gentiles wanted to think about it much. I remember the time and mood acutely on account of travels with my grandfather.
He was a rabbi and a loving but not a happy man. His synagogue was in Brooklyn, at the heart of an area that was full of resettled Holocaust survivors. He would visit them often, especially ones who had lost their families and not remarried. Naturally they were the loneliest. But what they suffered from most was not loneliness but the pressure of not telling. Pressure against their skulls from the inside, hard to bear. They needed to speak, but no one needed to listen.
Old or middle-aged men with gray faces and narrow wrists where the camp number was tattooed forever in dirty turquoise, living alone in small apartments: They would go on for an hour or more, mumbling with downcast eyes as if they were embarrassed--but they were not embarrassed; they were merely trying to keep emotion at bay so they could finish. Not to be cut down by emotion was the thing; they wanted to make it through to the end. So they would mumble quickly as if they were making a run for it, in Yiddish or sometimes Hebrew or, occasionally, heavily accented English. My Hebrew was inadequate and my Yiddish was worse, but I could get the gist, and my grandfather would fill me in afterward. Once an old man wanted to tell us how one man in a barracks of 40 had stolen a piece of bread (or something like that), and in retaliation the whole group was forced at gunpoint to duck-walk in the snow for hours. He didn't know the right word, so he got down on the floor to show us--an old man; but he had to tell us what had happened.
Steven Vincent went to Iraq after the war and reported in Commentary about Maha Fattah Karah, an old woman, sobbing. "I look to America. I ask America to help me. I ask America not to forget me." Saddam murdered her husband and son. That story takes me back.
My grandfather was driven. He spent years at one point translating a rabbi's memoir from Hebrew, then more years trying to find a publisher--any publisher; but no one wanted it. Holocaust memoirs were a dime a dozen, and (truth to tell) had rarely been hot literary properties in any case. Then he shopped the "private publishers" who would bring out a book for a fee. He tried hard to raise the money. He was a good money-raiser for many fine causes. But this time he failed. No one wanted to underwrite a Holocaust memoir. The book never did appear.
THE HOLOCAUST SHRUG: To turn away is a natural human reaction. In 1999 (Steven Vincent reports) the Shiite cleric Sadeq al Sadr offended Saddam--whose operatives raped Sadeq's sister in front of him and then killed him by driving nails into his skull. Who can grasp it? In any case, today's sophisticates cultivate shallowness. They deal in cynicism, irony, casual bitterness; not in anguish or horror or joy.
Lucy Dawidowicz discussed the unique enormity of the Holocaust. It destroyed the creative center of world Jewry and transferred premeditated, systematic genocide from "unthinkable" to "thinkable, therefore doable." Mankind has crouched ever since beneath a black cloud of sin and shame.
Nothing will erase the Holocaust, but it is clear what kind of gesture would counterbalance it and maybe lift the cloud: If some army went selflessly to war (a major war, not a rescue operation) merely to stop mass murder.
That is not quite what the Coalition did in Iraq. We knew we could beat Saddam (although many people forecast a long, bloody battle); more important, we had plenty of good practical reasons to fight. Nonetheless: There were many steps on the way to the Holocaust, and we can speak of a step towards the act of selfless national goodness that might fix the broken moral balance of the cosmos. The Iraq war might be the largest step mankind has ever taken in this direction. It is a small step even so--but cause for rejoicing. Our combat troops did it. It is our privilege and our duty to make the most of it. To belittle it is a sad and sorry disgrace.

David Gelernter is a contributing editor to The Weekly Standard.

? Copyright 2004, News Corporation, Weekly Standard, All Rights Reserved.

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>> GREAT JOB PERVEZ?

Pakistan withdraws, calls mission success
By SADAQAT JAN
ASSOCIATED PRESS WRITER
A Pakistani government official, center, smiles, as he is surrounded by tribal elders after being released by foreign militants linked with al-Qaida, in Wana, Pakistan on Sunday, March 28, 2004. Pakistani troops began withdrawing from some parts of western Pakistan on Sunday after militants agreed to release captured soldiers and politicians, but officials said soldiers will remain in the area while tribal leaders negotiate the handing over of foreign militants. (AP Photo)
PESHAWAR, Pakistan -- Pakistan called its mission to chase down and kill Taliban and al-Qaida militants a success and began withdrawing troops Sunday after tribesmen along the border with Afghanistan agreed to release captured soldiers and politicians.
Officials said, however, troops would remain in the unruly western border region while tribal leaders negotiate the hand-over of other foreign militants.
Eleven soldiers were released Sunday morning and two local officials were expected to be released later in the day or early Monday, said Brig. Mahmood Shah, the regional security chief.
Another soldier escaped before he could be released, he added.
"The main objectives of the operation have been achieved. They included destroying dens, searching of homes, taking people into custody and the recovery of gadgets and equipment," Shah said.
Troops would regroup in South Waziristan's main town of Wana and remain in the area, he said.
But Shah said 500-600 suspected militants still may be hiding along the border with Afghanistan and he did not rule out using military force against them. The army would continue using a combination of military operations and talks with tribal leaders to rid the region of suspected al-Qaida forces and allies, he said.
About 10,000 Mahsud tribesmen met Sunday near Wana to help authorities track the perpetrators of an attack on an army convoy last week.
Late Saturday, military spokesman Maj. Gen. Shaukat Sultan said recently gathered intelligence - combined with eyewitness accounts - indicated that alleged terrorist Tahir Yuldash had been badly wounded and was in hiding. He said Pakistani forces were not close to capturing him.
"He might have slipped away, he's on the run," Sultan said.
Yuldash is the leader of an Uzbek terror group allied with al-Qaida called the Islamic Movement of Uzbekistan. He was previously mentioned as one of two possible "high-value targets" cornered when Pakistan's military began the sweep of South Waziristan on March 16.
Despite the apparent escape, Sultan said the operation had been successful because the military had killed 60 suspected militants and captured 163 more.
President Gen. Pervez Musharraf, a key ally of the United States, has sent 70,000 troops to the border with Afghanistan since the Sept. 11 attacks to prevent cross-border attacks - the first such deployment since independence from Britain in 1947.
U.S. and Afghan forces have deployed on the other side of the border as part of a new offensive against al-Qaida and Taliban forces there. Musharraf has said U.S. experts are working with Pakistani troops, but no American military forces have crossed into Pakistan.
"As far as al-Qaida is concerned, yes, indeed, they are in bigger numbers than we thought in that region. And we need to eliminate them. It's very clear that we will eliminate them," Musharraf said in an interview on ABC News' "This Week with George Stephanopoulos" aired Sunday in the United States.
He said tribal elders from six of the seven tribal groups in western Pakistan were cooperating with the government's efforts to capture, kill or drive out foreign extremists.
"They are cooperating with us, cooperating with the army. And I'm very sure we'll take a very hard stand, and the writ of the government will be established, and these people have to be eliminated," Musharraf said.

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Tokyo nixes extradition of alleged spy
THE ASSOCIATED PRESS
TOKYO -- A Japanese court rejected a request Monday to extradite a medical researcher wanted in the United States on charges of industrial espionage.
The Tokyo High Court turned down a request made by U.S. authorities for Takashi Okamoto, 43, a former researcher at the Cleveland Clinic in Ohio, said court spokeswoman Yukiko Morita. The court released no other details of the ruling.
Okamoto was charged in May 2001 with conspiracy, economic espionage and interstate shipment of stolen property related to Alzheimer's disease research.
According to a federal indictment, Okamoto left the United States on Aug. 17, 1999, a day after he and another Japanese man allegedly took genetic materials from a lab and left vials of tap water in their place.
Okamoto allegedly arranged for the materials to be sent to the Institute of Physical and Chemical Research, north of Tokyo. He also allegedly destroyed other biological materials.
Tokyo prosecutors took Okamoto into custody last month after Justice Minister Daizo Nozawa ordered them to start extradition proceedings. Court hearings began earlier this month.
Japan and the United States have an extradition treaty, but Tokyo only sends its citizens to face charges abroad if they have been accused of acts that are also illegal in Japan.
While Japan doesn't have any economic espionage laws, the Justice Ministry had decided Okamoto's acts constituted theft and destruction of property under Japanese law.
Okamoto has claimed his innocence, saying he didn't think his actions were criminal, according to local media reports.
He is now a doctor at a hospital on Japan's northernmost main island of Hokkaido. He resigned from the Cleveland Clinic in 1999.
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Washington Prowler
Unity Diners
By The Prowler
Published 3/29/2004 12:07:19 AM
LOSERMEN IN ACTION
Apparently attendees at the Democratic Unity Dinner in Washington last Thursday night got a look at another version of Al Gore Unleashed.
This Gore updated model is a vindictive and bitter, washed-up candidate who acts like a teen-age girl trying to impress the cool kids. For example, upon seeing the Rev. Jesse Jackson on stage, Gore made a beeline toward him and, while casting his gaze across the stage at his former running mate, Sen. Joe Lieberman, wrapped Jackson in a big hug.
"Jackson looked mortified," says an onlooker. "That kind of affection wasn't something he was looking for."
Gore then turned and walked toward Lieberman ... and simply patted him on the back. "They don't get along, for obvious reasons," says a former Lieberman campaign staffer. "Gore has never apologized for his betrayal."
But one good turn deserves another, and Gore got the stiff himself when he attempted to reach out to his former boss, Bill Clinton. Clinton, refused to step up to Gore, instead putting current presidential candidate Sen. John Kerry between him and Gore. So much for unity.
Down in the audience, similar behavior was unfolding. Sen. Tom Daschle had one of his staffer complain to DNC organizers about his seating, which placed him about three rows back in the audience during dinner. His table was not as good as the one set aside for some of Kerry's campaign staffers, including uber consultant Bob Shrum.
SANITY REIGNS
A month ago, AFSCME president Gerald McEntee was saying that his ex-golden boy, former Vermont Gov. Howie Dean, was insane. Now McEntee is getting back in bed with his nutty pal.
According to former Dean campaign sources, McEntee has committed funds in the "seven figure range" to Dean's new grassroots program. The money from AFSCME will be used to strengthen the commitment of Dean's young voting block to the Democrats and not to independents or third-party candidates in 2004.
"It's all about [Ralph] Nader," says a former Dean staffer, who is mulling an offer to rejoin Dean's operation. "There is real concern about young-voter flight to Nader or elsewhere now that Dean is gone. McEntee's money would try to shore up that support."
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Saddam betrayed by bodyguard
Saddam Hussein was finally betrayed by a relative who was one of his closest bodyguards, a BBC programme reveals.
Panorama reports that after eight months on the run, the hiding place of the ousted Iraqi leader was given away by an aide known as "the fat man".
The programme, to be broadcast on BBC One on Sunday, says Mohammed Ibrahim Omar al-Musslit gave away the secret after being arrested and interrogated.
Saddam Hussein was captured on 13 December near his home town of Tikrit.
Mr Musslit was a loyal lieutenant of Saddam Hussein. He was one of the people who accompanied the Iraqi leader as he fled Baghdad in a white Oldsmobile, as US troops entered the city on 9 April 2003.
But Panorama will reveal that he was quickly broken by interrogators after being captured in Baghdad, and led American troops to his boss just hours after being arrested in December.
No reward?
After his arrest, Mr Musslit was flown to Tikrit where he was interrogated. He was then made to point out the remote farm where Saddam Hussein was hiding
I think the US treasury gets to keep the money
Major-General Raymond Odierno
The 600 American soldiers there found nothing in the farm buildings, but discovered Saddam Hussein hiding in an underground passage.
But because he did not willingly offer the information, the man who led the Americans to Saddam Hussein's secret bunker near his home town of Tikrit will not benefit from the $25m reward that was on offer.
A senior US commander, Major General Ray Odierno, denied the source had been tortured but told the programme that he was "a shady character", adding that he believed "the US treasury gets to keep the money."
To this day the US will not reveal the identity of the man who led them to Saddam Hussein.
Key figure
Colonel James Hickey, of the 4th Infantry Division, the unit that captured him in "Operation Red Dawn" would only say that he was "a middle aged man who went pear shaped."
However, people close to Saddam Hussein confirmed to Panorama reporter Jane Corbin that it was Mr Musslit who betrayed the former Iraqi president.
Mr Musslit was a key figure in Saddam Hussein's security organisation and had been in the Fedayeen.
By the end, Mr Musslit was believed to be the only man who knew of Saddam Hussein's full movements.
Panorama: Saddam on the run will be broadcast on BBC One on Sunday, 28 March 2004 at 2215 BST
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/programmes/panorama/3572659.stm
Published: 2004/03/26 22:44:54 GMT
? BBC MMIV
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Al-Qa'ida 9/11 chief reveals US got off lightly
From The Sunday Times
March 29, 2004
IT makes a chilling picture. The mastermind behind the September 11 attacks has told interrogators that he and his terrorist nephew leafed through almanacs of US skyscrapers when planning the operation.
Sears Tower in Chicago and Library Tower in Los Angeles - which was "blown up" in the film Independence Day - were both potential targets, according to transcripts of interrogations of al-Qa'ida operations chief Khalid Shaikh Mohammed. "We were looking for symbols of economic might," he told his captors.
He recounted sitting looking at the books with Ramzi Yusuf, his nephew by marriage, who was the man behind the first World Trade Centre bombing in 1993. In that attack Yusuf succeeded only in ripping a crater into the foundations with a van bomb.
"We knew from that experience that explosives could be problematic," Khalid said, "so we started thinking about using planes."
When he was captured last March in the house of a microbiologist in Rawalpindi, Pakistan, the paunchy 37-year-old was unshaven and wearing a baggy vest. He looked more like a down-and-out than one of the most dangerous men in the world.
The interrogation reports make clear, however, that he was not only the chief planner for September 11 but also introduced Osama bin Laden to Hambali, the Indonesian militant accused of orchestrating the Bali bombing 13 months later.
To date, Khalid is the most senior al-Qa'ida member to have been caught. Until now there has been no word of where he is being held or what, if anything, he is saying.
Although the interrogation transcripts are prefaced with the warning that "the detainee has been known to withhold information or deliberately mislead", it is clear that he is talking - and that the September 11 conspiracy was much more extensive than has previously been revealed.
The confessions reveal planning for the atrocity started much earlier than anyone had realised and was intended to be even more devastating.
"The original plan was for a two-pronged attack with five targets on the east coast of America and five on the west coast," he told interrogators.
"We talked about hitting California as it was America's richest state and bin Laden had talked about economic targets."
Bin Laden, who like Khalid had studied engineering, vetoed simultaneous coast-to-coast attacks, arguing that "it would be too difficult to synchronise".
Khalid switched to two waves: hitting the east coast first and following up with a second attack. "Osama had said the second wave should focus on the west coast," he said.
Zacarias Moussaoui, a French-Moroccan who had lived in London, was sent to the Pan Am international flight school in Minnesota to train for the west coast attack, according to Khalid. His instructor alerted the FBI, however, after the Moroccan showed no interest in landing planes - only in steering them. He was arrested in August 2001.
Until now it had been widely believed that Moussaoui was meant to have been the 20th hijacker on September 11. The revelation by Khalid that he was part of a "second wave" is lent weight by the FBI's recent arrest of two other men who were allegedly part of the west coast conspiracy.
Despite the setbacks, Khalid described the September 11 attack as "far more successful than we had ever imagined".
Khalid, whose family came from Pakistan, was born in 1965 in Kuwait City, where his father was a preacher. He joined the Muslim Brotherhood as a teenager and went to the US to study engineering in North Carolina.
At that time the Afghan jihad against the Russians was in full flow. After graduating, Khalid headed for one of bin Laden's guesthouses in the Pakistani frontier town of Peshawar. He has told interrogators it was there that he first met Hambali.
In 1992 Khalid moved south to Karachi. Posing as a businessman importing holy water from Mecca, he acted as a fundraiser and intermediary between young militants and wealthy sponsors in the Gulf.
Yusuf's attempt to blow up the World Trade Centre inspired him to conceive his own operations. The first was a plot to blow up 12 American airliners over the Pacific. Both Yusuf and Hambali were involved. It failed after their Manila bomb factory caught fire. The men fled to Pakistan where Yusuf was arrested.
Undeterred, Khalid decided to start working on something "far more spectacular" for which he "hoped to persuade bin Laden to give him money and operatives". He also decided to introduce Hambali to bin Laden.
Hambali headed Jemaah Islamiah, which wanted to unite Southeast Asia under an Islamic banner.
Khalid told interrogators: "I was impressed by JI's ability to operate regionally and by Hambali's connections with the Malaysian government. He told me that his group had a training camp in The Philippines and a madrasah (religious teaching) program in Malaysia on the border with Singapore.
"In 1996 I invited Hambali to Afghanistan to meet Osama. He spent three or four days with him and it was agreed that al-Qa'ida and Hambali's organisation would work together on 'targets of mutual interest'."
Hambali, who had been operating on a shoestring, was provided with a new car, mobile phones and computers.
Bin Laden was apparently impressed by Khalid's networking and ideas and made him head of al-Qa'ida's military committee. From then on he was a key planner in almost every attack, including the simultaneous bombings of the US embassies in Kenya and Tanzania in 1988. Bin Laden dubbed him The Brain.
The big challenge was to attack Americans on their own soil. Initially Khalid proposed leasing a charter plane, filling it with explosives and crashing it into the CIA headquarters. But the plan expanded.
Bin Laden pointed out that on a visit to the US in 1982 he had been to the Empire State Building in New York and was astonished by how unprotected such key landmarks were.
A committee, known as the shura, was formed comprising bin Laden, Khalid and four others. It met at what was known as the war room in bin Laden's camp outside Jalalabad in Afghanistan. The plan for a two-pronged attack was formed. "We had scores of volunteers to die for Allah but the problem was finding those familiar with the West who could blend in as well as get US visas," Khalid told his interrogators.
Two Yemenis and two Saudi pilots, Nawaf al-Hazmi and Khalid al-Midhar, were selected and given commando training in Afghanistan. "All four operatives only knew that they had volunteered for a martyrdom operation involving planes," Khalid said.
In 1999 the two Yemenis were refused US visas; but a few months later four jihad recruits from Hamburg arrived in Quetta, Pakistan. Led by Mohammed Atta, an Egyptian, they had originally planned to go to Chechnya to fight the Russians, but a former mujaheddin in Germany had given them an introduction to bin Laden.
After meeting the al-Qa'ida leader in Kandahar, they delivered the baia, the oath of allegiance required to gain access to his inner circle, and were invited to his Ramadan feast. He told them that they had been selected for a top-secret mission and promised that they would enter paradise as martyrs.
They were instructed to go home and destroy their passports so their trip to Pakistan would be undetected. They were then to shave off their beards, go to the US and obtain pilot's licences.
Khalid told interrogators he had provided them with a special training manual which included information on how to find flight schools and study timetables.
Three of the four were granted US visas and travelled to the US. The fourth, Ramzi Binalshibh, failed and returned to Afghanistan, where he communicated with them through internet chat rooms.
In the spring of 2000, after a planning meeting in Kuala Lumpur, bin Laden scaled back the plan from two-prong to two-wave because they had been unable to get enough potential pilots into the US. Moussaoui succeeded in entering the US, but the order went out for potential recruits who were not Arab, Khalid told his captors.
A date was set for the first-wave attack, codenamed Porsche 911, and a message went around the world for followers to return to Afghanistan by September 10.
The messages were intercepted by several Western intelligence agencies but none apparently realised their significance.
When the suicide planes struck on September 11, al-Qa'ida seems to have been taken by surprise - both by the success of the attacks and by the US reaction.
"Afterwards we never got time to catch our breath, we were immediately on the run," Khalid said.
He said the war on terrorism and the US bombing of Afghanistan completely disrupted their communications network. Operatives could no longer use satellite phones and had to rely on couriers, although they still used internet chat rooms.
"Before September 11 we could dispatch operatives with the expectation of follow-up contact but after October 7 (when the bombing started) that changed 180 degrees. There was no longer a war room or shura and operatives had more autonomy."
He told interrogators that he remained in Pakistan for 10 days after September 11, then went to Afghanistan to find bin Laden: "I went to Jalalabad, Tora Bora, looking for him and then eventually met him in Kabul."
The al-Qa'ida leader instructed him to continue operations - with Britain as the next target.
"It was at this time we discussed the Heathrow operation," Khalid said. "Osama declared (British Prime Minister Tony) Blair our principal enemy and London a target."
He arranged for operatives to be sent from Pakistan and Afghanistan to London, where surveillance of Heathrow airport and the surrounding areas began. However, he claimed, the operation never got beyond the planning stages. "There was a lot of confusion," he said. "I would say my performance at that time was sloppy."
One priority was to get Hambali out of Afghanistan. In November 2001, Khalid arranged for him to go to Karachi. There he gave him $US20,000 and a false Indonesian passport with which he could travel to Sri Lanka and on to Thailand, from where he would help to organise the Bali nightclub bombing the following year. They kept in touch through Hambali's younger brother, who was in Karachi.
The net was closing in around Khalid. Another shura member, Abu Zubayda, was arrested in Faisalabad in March 2002. Six months later Binalshibh was seized in a Karachi apartment he shared with Khalid.
Khalid escaped, but his flight came to an end in the early hours of March 2 last year in Rawalpindi. Questioned for two days by Pakistan's military intelligence, who say he did nothing but pray repeatedly, he was flown blindfolded to Bagram, the US base in the mountains above Kabul.
It is not clear how long he was held there, nor what methods were used to make him talk. Afghans freed from Bagram claim to have been subjected to sleep deprivation and extremes of hot and cold. There have also been reports of truth drugs.
? The Australian
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>> KPMG GOOD TURN?

'Massive scam' in Iraqi oil program
From The Sunday Times
March 29, 2004
AN investigation into the United Nations oil-for-food program in Iraq is to name more than 200 people, including British and European politicians, businessmen and senior UN officials, who may have profited from Saddam Hussein's regime.
The inquiry is being conducted by accountants KPMG and international law firm Freshfields Bruckhaus Deringer on behalf of the US-appointed Iraqi Governing Council. The KPMG team has previously traced assets seized by the Nazis during the Holocaust.
The investigators claim tens of billions of dollars may have been improperly distributed under the auspices of the oil-for-food program.
The publication of the report, probably in May, is likely to embarrass the UN. It stands accused of failing to properly police the oil scheme, while senior officials allegedly took kickbacks.
The scheme, set up in 1995, allowed the Iraqis to sell oil worth more than $US47 billion ($62 billion) in return for food and other essential humanitarian supplies.
But investigators say Iraqi documents suggest millions of barrels of oil were given as bribes for supporting the Hussein regime.
KPMG is also investigating claims that bribes were paid to UN staff and that food unfit for human consumption was traded for oil.
The report will for the first time identify everybody who was allegedly allocated oil and others who might have acted improperly under the scheme. Further investigation will establish how many were profiting illegally from the arrangement, although some were legitimate traders.
The investigation into the scandal is being overseen by Claude Hankes-Drielsma, a former chairman of the management committee of Price Waterhouse who is now advising the Iraqi council.
In a letter to UN Secretary-General Kofi Annan earlier this month, Mr Hankes-Drielsma said: "The UN failed in its responsibility to the Iraqi people and the international community at large.
"It will not come as a surprise if the oil-for-food program turns out to be one of the world's most disgraceful scams and an example of inadequate control, responsibility and transparency, providing an opportune vehicle for Saddam Hussein to operate under the UN aegis to continue his reign of terror and oppression."
The KPMG team is trawling through documents held in several Iraqi government departments, including the oil ministry in Baghdad. Investigators are interviewing the Iraqi civil servants who reportedly signed and compiled the documents to verify their authenticity.
After the report is published, a second phase of the investigation will trace what happened to the allocated oil, where and if it was sold, how much money was made and by whom.
"Many on the list may be absolute bona fide oil traders. But there are people on the list who have been allocated oil and you have to ask why," Mr Hankes-Drielsma said.


? The Australian


Why world can't rest on retirement
By Frances Cairncross
March 29, 2004
SOMETHING unprecedented and irreversible is happening to humanity. This year or next, the proportion of people aged 60 or over will surpass the proportion of under-5s. For the rest of history, there are unlikely ever again to be more toddlers than grey heads.
Already those aged 65 and over, who throughout recorded time have rarely accounted for more than 2-3 per cent of most countries' people, make up 15 per cent of the rich world's inhabitants.
So this is the start of what the Japanese (who will have a million centenarians by mid-century) call the Silver Century. The rise in the proportion of the world's old will be the century's defining demographic trend.
In some countries it may also determine the nature of politics, rates of economic growth (ageing countries will have slower rates of growth per head than those with younger populations) and global clout.
In fact, three trends are running in parallel, each at a different pace. The first is a bulge in retirement, which will become noticeable in just over a decade.
The older members of the US baby-boom generation are due to turn 62 (the minimum age at which social security allows early retirement) in 2008.
But the generation, like a pig in a python, will guarantee an unusually large proportion of old folk - and then of very old folk - in the populations of most rich countries in this century's middle years.
Its impact will be aggravated by a second trend: the widespread fall in fertility rates.
In most countries women on average are not having enough babies to replace the people who die. In some countries, mainly in continental Europe and Japan, birth rates have been below replacement for a quarter of a century. When the baby boomers retire, the size of the working population will plummet. That in itself is worrying enough. But there is a third problem: the old spend much more time in retirement than ever before. Life expectancy continues to rise, yet people are drawing their pensions earlier and earlier.
A century ago, most old people worked almost up to the end of their days. Now, by the age of 65, only 16 per cent of men are still in the workforce in the US and only 4 per cent in continental Europe.
Thus, a larger generation of old folk than ever before will need support for longer than ever before from a population of working age that is shrinking continuously in absolute size for the first time since the Black Death.
And the level of that support is unprecedented. The triumph of Europe's welfare state and the US's social security system has been more or less to eradicate poverty among the old. All rich countries have health insurance systems with near-universal coverage for the retired.
The cost of these benefits, in effect, falls on those in work. This has prompted books with scary titles, such as The Coming Generational Storm.
Moreover, if things look bad in the US and worse in continental Europe, they will one day look calamitous in some parts of the developing world. There, the passage of the pig within the python will be even more rapid.
Countries as diverse as Brazil, Iran and Turkey will all be below replacement rate within 15 years.
China's huge Red Guard generation - its equivalent of the US's baby boomers - reaches retirement age around 2015.
Meanwhile, thanks to China's one-child policy, the fertility rate has plunged from six or seven children per woman in the 1960s to below replacement rate.
In a decade's time, many countries thus start to face a huge problem: how to support a vastly larger population of old folk.
There are only three ways to provide income in old age: one, to store goods for later consumption, which in practice doesn't work (just try storing a hip replacement operation); two, to exchange current production for claims on future production, by saving or by extracting promises from your children or the government; and three, to go on producing yourself.
The promises governments have made to people retiring today are too large to be met in full. As a result, people will have to work longer, and retire later, than they do now. And the old will have to insure themselves for more of the cost of healthcare.
Fortunately there is a time window, of about a decade, during which the population of working age will be at a historic high. OECD projections show that the impact of retiring baby boomers will not begin to be felt until the next decade, and will culminate in 2025-35.
So governments have a chance - but one that they must grab fast.
It will not be easy. The notion of retirement - an abrupt end to paid employment - is relatively recent but has been hugely popular. Cutting it back is expected to cause uproar.
Massachusetts Institute of Technology economist Dora Costa, who wrote The Evolution of Retirement, points out that people began to reduce the length of their working lives as soon as they could afford to do so, and long before generous social benefits were widely available.
Not only do the old live longer than ever; the range of pleasures available in retirement, such as foreign holidays and home entertainment, are more varied and less expensive than ever before.
The longer that countries postpone the steps needed to make retirement sustainable, the more abrupt and damaging the transition will be. But given the will, change is possible.
Pioneering work by two US economists, Jonathan Gruber and David Wise, has shown that retirement decisions are greatly influenced by the structure of pensions and other benefits. If it pays to stop working, people will. Driven by fiscal desperation, governments will increasingly steel themselves to alter the way benefits work.
Once that change begins, there will be jobs for those who want them. When the baby boomers start to retire in large numbers, they will empty out workplaces - such as public services - that now have lots of staff in their 50s. To replace them, employers will have to come up with the sort of flexible deals they once used to attract women back to work.
Indeed, the workplace revolution that lies ahead may be very like the one that, in the course of the 1970s and 80s, brought millions of mothers into the job market.
Since then, the workplace has been feminised; in future it will be grizzled. A quarter of a century from now, retirement will look different: a mix of work and gardening, rather than gardening alone. For older people, work may then offer some of the charms that have lured so many women into the job market: stimulus, companionship and the freedom from worry that extra money can bring.
Frances Cairncross is management editor of British news magazine The Economist.


? The Australian

>> AHEM...

'Let it happen' - Richard Clarke helped bin Laden family flee United States after 9/11
As counterterrorism czar, Richard Clarke helped the al Qaeda leader's family out of the US.
Former National Security Council counterterrorism czar Richard Clarke approved the evacuation of Osama bin Laden's relatives from the United States after the September 11, 2001 attacks.
"It was Clarke who personally authorized the evacuation by private plane of dozens of Saudi citizens, including many members of Osama bin Laden's own family, in the days immediately following September 11," the Boston Herald notes in a March 26 editorial.
According to the Herald, "Clarke's role was revealed in an October 2003 Vanity Fair article. 'Somebody brought to us for approval the decision to let an airplane filled with Saudis, including members of the bin Laden family, leave the country,' Clarke told Vanity Fair. 'My role was to say that it can't happen unless the FBI approves it. . . And they came back and said yes, it was fine with them. So we said "Fine, let it happen."'
"Vanity Fair uncovered that the FBI never fully investigated the passengers on those privately chartered flights (one of which flew out of Logan International Airport after scooping up a dozen or so bin Laden relatives.) But Clarke protested to Vanity Fair that policing the FBI was not in his job description."


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Hamas linked to area housing


By Jerry Seper
THE WASHINGTON TIMES


The terrorist organization Hamas invested millions of dollars during the past decade in real-estate projects nationwide, including in suburban Maryland, as part of a scheme to raise cash to fund acts of terrorism, records show.
The investments -- involving the construction of hundreds of new homes, including many in Oxon Hill -- were handled through BMI Inc., a defunct Secaucus, N.J., investment firm founded by Soliman S. Biheiri, an Egyptian and Hamas supporter, according to a newly released sentencing declaration by U.S. Immigration and Customs Enforcement (ICE).
In the declaration, ICE senior agent David Kane said Biheiri, sentenced in January to a year in prison on immigration violations, used the firm beginning in 1991 to raise "large amounts of money" through investments and as a front to route cash from more than 100 bogus Hamas charities and businesses, most of which operated in Virginia.
The Oxon Hill investment included a project known as Barnaby Knolls, financed by a BMI subsidiary BMI Real Estate Development Inc., the declaration said. Begun in January 1991, it involved the construction of 57 homes in the working-class Prince George's County neighborhood.
ICE agents refer to the project as "Hamas West," although no one living in the subdivision has been identified as being involved in the scheme or with the terrorist organization that is pursuing a Palestinian state.
One of the principle BMI investors in the Oxon Hill project, according to the Kane declaration, was Mousa Mohammad Abu Marzook, the self-proclaimed political leader of Hamas detained by U.S. authorities in 1995 on suspicion of being involved in terrorist activities. He later was expelled to Jordan, where he was deported to Syria for his ties to Hamas.
The U.S.-educated Marzook, who had lived in Falls Church, has been named by Israeli authorities on charges of murder, attempted murder, manslaughter and conspiracy in truck and bus bombings in Israel that killed 14 and injured 56. He also is accused of ordering the killing of 37 others in Hamas attacks in Israel.
According to the declaration, Marzook told a confidential U.S. Customs Service informant during a May 1991 meeting in Ruston, La., that he "has and currently is investing money with BMI," including a real-estate project in Oxon Hill, where he intended to build "more than 56 homes." In the tape-recorded conversation, Marzook noted that the suburban Maryland site was close to Washington.
According to the declaration, more than $1 million was invested by BMI in various real-estate projects, many of which are described but not identified.
The declaration said hundreds of thousands of dollars invested in the projects was returned to investors or were re-invested in other real-estate developments, with much of the cash being routed through banks in Virginia and New Jersey to Dubai in the United Arab Emirates. It said significant amounts of cash obtained in the real-estate ventures were used "in furtherance of Hamas terrorist operations."
It was a U.S. investigation into Marzook's financial activities in this country that led to Biheiri, BMI and Ptech, a Boston-based computer software firm raided by customs agents in December 2002, authorities said. They said Biheiri and Yasin Qadi, a key BMI investor, were the primary Ptech financiers.
Qadi, a Saudi multimillionaire, was listed by the Treasury Department in 2002 as a terrorist and is thought by authorities to have diverted millions of dollars to Osama bin Laden's al Qaeda network through various charitable organizations.
Biheiri was a key figure in a scheme using private companies and interrelated Islamic charities operating out of business fronts in Herndon and Falls Church to divert millions of dollars to global terrorists, including Hamas and al Qaeda.
In 2002, federal agents raided 14 Islamic businesses in Virginia, seizing computers, bank statements and other documents in a customs investigation known as "Operation Green Quest." That probe focused on what authorities called a "financial relationship between" BMI and a Herndon corporation Sana-Bell Inc.
Authorities said Sana-Bell existed to generate funds for a Falls Church-based charity known as the International Islamic Relief Organization (IIRO). In an affidavit filed in connection with the Green Quest investigation, Mr. Kane said the CIA listed the IIRO as having "extremist connections" to Hamas and Al-Gamaa Al-Islamiya, the Egyptian terrorist organization that served as a precursor to al Qaeda.
Hamas was designated by the State Department as a terrorist organization in 1991. Although the number of hard-core members is unknown, supporters and sympathizers have been placed in the tens of thousands. Much of its fund raising takes place in the United States.

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A dangerous stalemate in Venezuela



Venezuelan President Hugo Chavez has been able to relegate a recall drive on his government to a kind of bureaucratic netherworld. This maneuvering hasn't stanched mounting tensions, though, and may well lead to a series of violent demonstrations. Such a conflict would test the ability of the regional players, such as the Organization of American States (OAS) and Brazil, to deal with a crisis.
At issue is a petition drive held last year calling for a recall referendum on the Chavezgovernment.Recently, Venezuela's electoral chamber of the Supreme Court cleared the way for a recall vote by finding that an electoral committee -- created to oversee the referendum drive -- was wrong in rejecting 876,000 signatures on mere technicalities. This gave the opposition more than the 2.43 million signatures needed to hold a referendum. But on Tuesday, the constitutional chamber of the court -- which is headed by Ivan Rincon, a staunch Chavez ally -- rejected the jurisdiction of the electoral chamber. That decision can be appealed to the full court, which is also headed by Mr. Rincon.
The current impasse helps Mr. Chavez run out the clock. According to the Venezuelan constitution, if a referendum isn't held by Aug. 19, then the Venezuelan people could vote against the Chavez government in a recall, but his vice president would remain in charge for the current term. Given the recent bureaucratic gyrations, it is highly unlikely a referendum could be held by the August deadline. In either scenario, "the opposition will probably react by trying to force [Mr. Chavez] out of power in a less formal way," said Ricardo Amorim, head of Latin America Research at IDEAglobal. This would probably lead to "confrontation on the streets, with very likely people getting killed," he added. Although it is unlikely such a confrontation would cause the same economic trauma as the general strike called at the end of 2002, it could still reverse Venezuela's oil-driven rebound. However, such a crisis is not expected to have any substantive impact on the global oil market.
Brazil, other Latin American countries and the United States should make clear to Mr. Chavez that his government could face international sanction should the OAS denounce the referendum process. The OAS must be the arbiter of the legitimacy of the process. Should Mr. Chavez abide by his obligations and prevail, the opposition must be firmly told that its efforts to unseat him before the 2006 elections have no backing.
Should the parties delay in alerting Mr. Chavez that they are unified in supporting whatever conclusions the OAS reaches, Mr. Chavez and his supporters could become entrenched in positions they may be unwilling to reverse for political reasons. Applying some pressure on Mr. Chavez now could yield stability for the country and the region.


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Venezuela forces tortured protesters -ombudsman
CARACAS, Venezuela, March 25 (Reuters) - Venezuelan security forces tortured some protesters detained during recent anti-government demonstrations, but did not shoot and kill demonstrators, the state ombudsman said on Thursday.
In a report to the National Assembly, German Mundarain, a state official who investigates complaints against public authorities, said nine civilians were killed in street clashes between troops, police and opposition protesters between Feb. 27 and March 5 in Caracas and other cities.
Human rights groups have accused President Hugo Chavez's government of using excessive force to control the protesters, who were demanding that Chavez submit to a recall referendum.
They cited cases of shootings, beatings and torture.
The left-wing president, who is resisting the opposition vote petition, has denied there were rights abuses, condemned the pro-referendum protesters as armed subversives and praised the actions of his security forces.
Mundarain, who has been repeatedly accused by the opposition of being biased in favor of the government, said 193 people were injured during the disturbances and 513 were detained, although most were quickly released.
"These detentions gave rise to cases in which some officers went beyond the legitimate use of force," he said in the report, citing seven cases of torture and 17 of "cruel, inhumane or degrading treatment."
Human rights groups said detainees were subjected to severe beatings, burnings, electric shocks and mock executions.
The ombudsman urged the government to investigate these cases and prosecute those responsible if necessary, but also accused opposition leaders of "instigating violence" and said troops and police were fired on.
Mundarain said no deaths could be attributed so far to security forces because none of the deadly shooting injuries were caused by the regulation automatic rifles they carried.
Opposition leaders and a local human rights group put the death toll at 14, and cite eyewitness reports that troops killed some protesters. Witnesses say unidentified civilian gunmen also opened fire.
Opponents of former paratrooper Chavez, who was elected in 1998, accuse him of becoming increasingly dictatorial and repressive. He dismisses his enemies as U.S.-backed "oligarchs" trying to end his "revolution" seeking to fight poverty in the world's No. 5 oil exporter.

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>> CONGRESS FIDDLES...


Congressional talks on pension plan stall

ASSOCIATED PRESS
House and Senate negotiators yesterday hit an angry impasse over legislation that could save employers billions of dollars, with just days left before companies must begin making their quarterly pension payments.
There were no immediate plans to revive negotiations on the bill, which would provide employers two years of relief on payments they make into their pension plans. During that interval, Congress would work on long-term legislation to ensure viability of the pension system and retirement incomes of American workers.
Rep. John A. Boehner, Ohio Republican and chairman of the House Education and the Workforce Committee, said Democrats had rejected a compromise offer that "was as far as we could go."
Democrats, led by Sen. Edward M. Kennedy, of Massachusetts, put the blame on the White House.
Mr. Kennedy said the Bush administration leaned on Republicans to resist help for union-based multiemployer pension plans, which he said "reflects an ideological viewpoint."
The deadlock complicates efforts to pass a compromise bill next week, before Congress leaves for its spring recess, and dims hopes that companies sponsoring single-employer plans will have new guidelines before April 15, when many have to make quarterly contributions.
The two sides are in general agreement on single-employer plans, which face the most serious financial problems and are the main focus of the bill.
The bill would determine a new corporate bond-based interest rate that would be used for the next two years to replace a formula, based on a very low interest rate, that has caused contributions to soar.
The Pension Benefit Guaranty Corp. (PBGC), a government agency that insures the pensions of about 44 million American workers, estimated the new rate would save companies $80 billion, which could be used for new hiring and economic expansion and could save some plans from bankruptcy.
Without the fix, companies "are going to have to divert money that they could otherwise put back in their business," said Dorothy Coleman, vice president for tax policy at the National Association of Manufacturers. "This is a critical issue to our economy."
Asghar Alam, U.S. retirement practice leader at Mercer Human Resource Consulting, wrote the negotiators this week that, without quick action, companies may not be able to meet the contribution deadline. That, Mr. Alam wrote, would pose a risk to companies that they would contribute cash that would not be deductible or that they would face tax penalties or federal action by failing to contribute enough.
"We urge you to begin that effort without allowing any more blows to be dealt to the traditional plans that have weathered so much in the past few years," Mr. Alam said.
The main stumbling block is Senate language that would allow the nation's 1,700 multiemployer plans to defer losses over the next two years. The administration objected, saying that would encourage underfunding of plans, and threatened to veto the bill unless that provision was eliminated.
Mr. Boehner said Republicans offered a compromise yesterday that would help multiemployer plans with the greatest financial need, which Republican aides said would be accessible to significantly fewer than 20 percent of all plans.
Rep. Robert E. Andrews, New Jersey Democrat, said that would help fewer than 10 percent of plans, and "that was not acceptable."
Mr. Kennedy attributed the deadlock to intransigence, arbitrary interference and "punitive, antilabor provisions" from the White House.
Multiemployer plans, which cover about 9 million of the 44 million workers covered by the PBGC, are usually operated jointly by labor and management in such fields as construction and trucking.
The General Accounting Office, the investigative wing of Congress, released a report yesterday that said multiemployer plans, after two decades of relative stability, "have suffered recent and significant funding losses" because of stock market declines and poor economic conditions. Multiemployer plans are now underfunded by $100 billion, up from $21 billion in 2000.
In addition to general accord on single-employer plans, the negotiators were close on the third part of the legislation; those would reduce for two years what airlines and steelmakers with underfunded pension plans must pay into a required catch-up fund.

A KNIGHT RIDDER INVESTIGATION

Air Force let Boeing rewrite terms of tanker contract
BY JOSEPH L. GALLOWAY
Knight Ridder Newspapers
WASHINGTON - The Air Force gave the Boeing Co. five months to rewrite the official specifications for 100 aerial refueling tankers so that the company's 767 aircraft would win a $23.5 billion deal, according to e-mails and documents obtained by Knight Ridder.
In the process, Boeing eliminated 19 of the 26 capabilities the Air Force originally wanted, and the Air Force acquiesced in order to keep the price down.
The Air Force then gave Boeing competitor Airbus 12 days to bid on the project and awarded the contract to Boeing even though Airbus met more than 20 of the original 26 specifications and offered a price that was $10 billion less than Boeing's.
The Boeing tanker deal has been under investigation since it became public two and a half years ago and has been suspended pending the outcome of the probes.
But the e-mails and other documents show just how intent the Air Force was on steering the deal to Boeing, even though Airbus' tankers were more capable and cost less.
In one document, Bob Gower, Boeing's vice president for tankers, noted that one objective in rewriting the specifications was to "prevent an AoA from being conducted." "AoA" stands for "analysis of alternatives" or, in essence, a look at serious competitors.
Among the original Air Force requirements Boeing eliminated was that the new tanker be equipped to refuel all the military services' aircraft, refuel multiple aircraft simultaneously, and carry passengers, wounded troops and cargo. Boeing also eliminated an Air Force requirement that the new tankers be at least as effective and efficient as the 40-year-old KC-135 tankers they would replace.
Sen. John McCain, R-Ariz., demanded the Boeing documents in his role as chairman of the Senate Commerce Committee. Senate investigators made the Boeing documents available to Knight Ridder.
Air Force Undersecretary for Acquisitions Marvin Sambur defended the Boeing deal. "This was not a competitive bid process," he said. "The Air Force was ordered by Congress to work with Boeing on the new tanker program."
Sambur was referring to a line item inserted into the appropriations bill in 2001, after the Sept. 11 attacks, by Sen. Ted Stevens, R-Alaska, which said the Air Force should lease 100 767s from Boeing to be used as tankers.
The bill passed the Senate over the objections of McCain and other senators. After the bill became law, McCain, in a committee hearing where Air Force Secretary James Roche was testifying, criticized Roche for an uncompetitive deal, and Roche agreed to conduct a competitive bidding.
The Air Force then put out a request for information to Boeing and Airbus, but by then Boeing and the Air Force had made arrangements that ensured Boeing would win.
Sambur also confirmed that the first 100 Boeing planes would be able to refuel only one plane at a time and would be able to refuel only Air Force planes.
The Boeing deal provides for a refueling capability for Navy, Marine and Special Operations aircraft "in the second spiral of development," Sambur said. Retrofitting the first 100 planes to do so would be at additional cost to the Air Force, he said.
But Doug Kennett, a Boeing spokesman in Washington, said that the first 100 tankers would be able to refuel Navy, Marine and allied aircraft one at a time.
He also said the Air Force turned Airbus down on failure to meet several specifications. The Airbus aircraft was larger than what the Air Force wanted and at the time Airbus did not have the specific type of refueling boom required by the Air Force, Kennett said.
Other sources said Boeing would have to redesign the wings of the 767 to add the ability to refuel more than one plane at a time. That cost also would be additional to the Air Force.
Politics has played a heavy role in the Boeing deal. House Speaker Dennis Hastert, R-Ill., whose state is home to Boeing headquarters, and Democratic Rep. Norman D. Dicks, who represents the state of Washington, where a key Boeing production plant is located, lobbied the White House on the deal.
Boeing and the Air Force also lobbied for the deal, and President Bush designated his chief of staff, Andrew Card, as the point man on the issue.
The Office of Management and Budget and other independent agencies criticized the tanker deal as too expensive and unneeded.
Card intervened and ordered them to move ahead with the Boeing deal.
White House spokesman Claire Buchan said Card sought to mediate the contract dispute without taking sides.
"There were disagreements among the Air Force, the DOD (Department of Defense) and the OMB. His role was to ensure that all sides were heard, and that the military's needs were met, and that the taxpayers got the best value for their money," she said Saturday.
Boeing e-mails indicated that Card was primarily interested in how many jobs the contract would create: Boeing claimed upwards of 28,000, but Roche, the Air Force secretary, in a letter to the White House upped the ante to 39,000 new jobs.
"This was a negotiation between the Air Force and Boeing; they weren't giving it to Airbus," said Steven Schooner, co-director of the Government Procurement Law Program at George Washington University. "It definitely lends support to the generally accepted reflection that this was never intended to be an open competition.
"In a competitive procurement, you don't let one of the competitors write this because it gives them a competitive advantage," Schooner said.
Senate investigators have plowed through some 8,000 pages of Boeing documents that were so embarrassing and revealing that the company last year fired one of its vice presidents, Darleen Druyun. Druyun had been an Air Force acquisitions officer involved in negotiations on the tanker deal. Boeing also fired its chief financial officer, who had hired Druyun. Boeing chairman and chief executive Phil Condit also left the company in an attempt to help Boeing put the scandal behind it and get the deal back on track.
McCain - who's led a two-year fight against what he considers both a bad deal for the government and an unnecessary deal for the Air Force - pointed out in a letter to Department of Defense Inspector General Joseph Schmitz earlier this month that the Air Force in 2001 developed a draft Operational Requirements Document (ORD) with 26 specifications for the new tanker aircraft, then gave the document to Boeing.
The Air Force's minimum requirements were subsequently reduced to only seven - and Boeing tailored the specifications to the airplane the company had on hand. The first 100 planes can only be used to refuel Air Force fighters and bombers.
The rewritten document was so thoroughly tailored to Boeing's wish list that when it was briefed to the Pentagon's Joint Requirements Board in July 2002 it was actually titled the "KC-767 ORD."
A board member's memo on the briefing said the operational requirements documents "should not be written for a specific aircraft but rather for a capability" and directed the title to be changed so as not to identify a particular aircraft.
The Air Force changed the name, but not the specifications.
Schmitz is set to release his audit report within the next week. It's the first of several investigations of the Boeing deal, including one by federal prosecutors.
A draft of the audit report, leaked earlier this month to Bloomberg News, said the Boeing contract was flawed and may need to be renegotiated because of "unsound acquisition and procurement practices." But Schmitz could find "no compelling reason" to kill the deal.
His report also questions whether the government should be leasing any of the aircraft, because the cost of leasing a Boeing 767 tanker is greater than the cost of buying one at $138.5 million each. The deal, as presently structured, would have the government lease 20 of the tankers and buy 80.
Schmitz told Knight Ridder that the audit report, once proprietary and source information is removed, will be released to the public. He added that his office has initiated an investigation "into related matters." An investigation by the inspector general involves law enforcement, while an audit looks into fiscal practices.
The Schmitz audit report is certain to generate fresh outrage on Capitol Hill, resulting in new hearings and renewed demands for the Air Force to hand over its internal documents on the Boeing deal, which it has been refusing to do for nearly a year on what one Senate investigator called "very shaky grounds."
McCain, who also sits on the Senate Armed Services Committee, is pressing the committee to force the Air Force to hand over its internal documents as well.
Sambur said that the decision to withhold the internal documents "is taken at a much higher level than the Air Force. It is a very serious decision. If everyone knew that their e-mails were subject to this kind of scrutiny no one would use it to debate with their colleagues and develop positions. They would watch every word they write."
An Airbus spokesman told Knight Ridder that if the aerial tanker contract was re-bid, the Airbus group would not only underbid Boeing again, but it would also agree to build the aircraft in the United States.
A federal prosecutor in the Eastern District of Virginia has been investigating allegations that Druyun simultaneously conducted negotiations on the tanker deal for the Air Force while negotiating with Boeing for a job when she retired after 33 years with the Air Force.

(Knight Ridder correspondents Seth Borenstein and Ron Hutcheson contributed to this report.)


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>> GENERICS 2...


Bush's AIDS Program Balks at Foreign Generics
U.S. Insistence on More Tests Complicates Rollout
By David Brown
Washington Post Staff Writer
Saturday, March 27, 2004; Page A03
The Bush administration is requiring that foreign-made generic AIDS drugs undergo further evaluation before they are used in its $15 billion global AIDS program, even though the same pills have passed muster by the World Health Organization and other international health groups.
Announced three weeks ago to the first organizations to get money through the Bush program, the decision is already complicating the rollout of the enormously ambitious President's Emergency Plan for AIDS Relief. That plan, which goes by the acronym PEPFAR, aims to put 2 million people in 14 African and Caribbean countries on life-saving antiretroviral therapy over the next five years.
The decision to spend U.S. funds only on brand-name drugs until foreign generics are studied further has angered AIDS activists. They see it as an effort to protect the U.S. pharmaceutical industry and undercut, at least symbolically, the burgeoning offshore generic drug industry.
"They are trying to hand the U.S. global AIDS plan over to Big Pharma," said Sharonann Lynch of the group Health GAP. "Look at the leg up that brand-name drugs are getting, courtesy of George Bush."
PEPFAR officials say they are only showing an abundance of caution as the United States government commences paying for lifelong medical treatment for millions of noncitizens, most of them in Africa.
"If in two or three years we have drug resistance as a result of a therapy that we introduce, we will have lost the continent in terms of our ability to treat," said Mark R. Dybul, an AIDS researcher from the National Institutes of Health now assigned to the Office of the U.S. Global AIDS Coordinator, at the State Department.
" 'Good drugs' isn't good enough. Because of the risk of resistance, we need the highest possible quality drugs to avert a disaster on the continent," he added.
Several experts believe the policy could have two possible effects.
It could delay initiating antiretroviral therapy in some AIDS patients in the developing world. Alternatively, it might require some of them to start taking more expensive brand-name pills and then switch to generic equivalents in six months to a year.
Even at the deep discounts offered by their makers, brand-name drugs in most cases are about three times the price of generics. And even if the period in which more expensive drugs are used is short, the policy could sow confusion in the minds of newly treated AIDS patients and complicate the operation of newly established AIDS clinics.
This is especially true in countries getting money not only from PEPFAR but also from sources such as the Global Fund for AIDS, Tuberculosis and Malaria, which endorses the pills that PEPFAR now prohibits.
"It is hard to simplify [an AIDS treatment system] when the Americans say: Let's do it with different drugs and a separate procurement system," Stephen Gloyd, a physician at the University of Washington, said. "It has a potential negative effect on the ground. It's not just an issue of buying more expensive drugs."
Through an organization called Health Alliance International, Gloyd is helping set up treatment programs in Mozambique with about $3 million from PEPFAR.
Practically speaking, the main drug that PEPFAR recipients will not be able to use immediately is a "fixed-dose combination" of three antiretroviral drugs -- stavudine, lamivudine and nevirapine -- made by several companies in India.
Sold as Triomune, Triviro and other names, it comes in a single pill and is taken twice a day. A year's supply can cost from $136 to $263. Taken as separate pills bought at a discount, this combination costs $559 a year.
The combination is one of four that World Health Organization experts recommend in the guidelines for the "3 by 5" program -- WHO's separate effort to help put 3 million people in poor countries on antiretrovirals by the end of 2005. In practice, about 90 percent of people who have never taken AIDS drugs are expected to start with it.
PEPFAR's prohibition against using this unusually handy pill arises from the requirement that AIDS drugs bought through the U.S. program must be "approved by a stringent regulatory authority or otherwise demonstrate quality, safety and efficacy at the lowest possible cost," according to guidelines issued in December. In practical terms, that means drugs approved by the Food and Drug Administration (FDA) -- this country's "stringent regulatory authority" -- or through other mechanisms the PEPFAR may set up.
Several years ago, WHO set up a system to help countries shop wisely for drugs used to treat the three big infections of poverty -- AIDS, tuberculosis and malaria. The system is called "prequalification."
Drug companies -- both those making patented brand-name drugs as well as those making unpatented generics -- are invited to submit their products for WHO evaluation. The drugs (or, in the case of combinations, their components) have been tested and licensed elsewhere. WHO examines them for purity, safety and efficacy. Employing three-person teams of regulatory experts, it also inspects the factories where they are made.
If the drug is deemed safe and potent, and the manufacturing procedures good, it is published on a list. Periodically, samples of these "prequalified" drugs are tested to make sure they are still up to standard, and are being made where they are supposed to be made.
The system is voluntary. Because it has no legal standing and is simply a service for WHO's 192 member states (especially ones that do not have an equivalent of the FDA), "prequalification" does not meet PEPFAR's legal requirements.
Generic drug manufacturers in India, Brazil and elsewhere could submit their products to the FDA for approval, but most do not because they would then have to honor U.S. patent law. Consequently, Triomune and similar products are not licensed for use in the United States.
Dybul said the data WHO collects may contain all the information PEPFAR needs to reassure itself that Indian generics are good enough. However, WHO collected the data with the understanding it would be confidential.
"All we are saying is: We need to see the data ourselves," Dybul said. He added that if anything bad happened because the Bush program used substandard drugs, "you would crucify us for not having the due diligence of looking at the data ourselves -- and rightly so."
However, because the data cannot be turned over to PEPFAR, U.S. officials are proposing that countries and organizations agree on a set of principles by which fixed-dose combination drugs -- not only for AIDS but also for other diseases -- can be evaluated. Each group could adopt the principles as its own, and drug companies would know what documentation to submit.
A meeting to work on a statement of principles is scheduled to take place Monday and Tuesday in Gaborone, Botswana. Even if adopted quickly, it could be fall before offshore AIDS generics get PEPFAR's approval under this mechanism.
Many experts do not think such a parallel system is necessary, given the existence of WHO's prequalification program.
"We are basically doing all the same functions" that the FDA does when it reviews generic combinations composed of medications that have long been taken together as separate pills, said Lembit Rago, WHO's coordinator for quality assurance and safety of medicines.
A clinical pharmacologist who once headed Estonia's counterpart to the FDA, Rago said in practical terms it is irrelevant that "prequalification" is not "legal licensure."
"It doesn't matter which color is the cat. It has to catch the mice," he said.
? 2004 The Washington Post Company
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Rapid Oral Test for HIV Approved
Reuters
Saturday, March 27, 2004; Page A03
The Food and Drug Administration has approved the first rapid saliva test for the virus that causes AIDS, officials said yesterday.
The test, made by OraSure Technologies Inc., provides results within 20 minutes with 99 percent accuracy. Other approved rapid tests for the human immunodeficiency virus require taking blood samples.
"This oral test provides another important option for people who might be afraid of a blood test," said Health and Human Services Secretary Tommy G. Thompson.
Officials also said the test could help on two fronts, encouraging more people to get tested as well as actually getting them the results.
One-fourth of the roughly 900,000 HIV-infected people in the United States are not aware they have the virus, the Centers for Disease Control and Prevention estimates.
People given standard tests that take a week or two often do not return to get the results. With a rapid test, a patient can get an answer in just one clinic visit. Those who test positive can start treatment quickly and take steps to keep from spreading the virus.
The new test also helps protect health care workers from becoming infected with HIV because they do not have to handle blood, officials said.
Results should be confirmed by a second, more specific test, the FDA said.

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Plan to Fight AIDS Overseas Is Foundering
By DONALD G. McNEIL Jr.
Three years after the United Nations declared a worldwide offensive against AIDS and 14 months after President Bush promised $15 billion for AIDS treatment in poor countries, shortages of money and battles over patents have kept antiretroviral drugs from reaching more than 90 percent of the poor people who need them.
Progress in distributing the drugs, which have sharply cut the death rate in the United States and other Western countries, has been excruciatingly slow despite steep drops in their prices.
As a result, only about 300,000 people in the world's poorest nations are getting the drugs, of six million who need them, according to the World Health Organization.
Experts, advocacy groups and health officials agree that the delays, compounded by inadequate medical facilities and training in very poor countries, are likely to persist unless spending is stepped up sharply.
Early this month, Stephen Lewis, the special United Nations envoy for AIDS in Africa, conceded that the W.H.O.'s ambitious plan to have three million people in treatment by 2005 -- announced on Dec. 1, World AIDS Day -- was already collapsing from a lack of money. Donations to the Global Fund to Fight AIDS, Tuberculosis and Malaria are now about $1.6 billion a year, barely 20 percent of what Secretary General Kofi Annan said was needed when he created the fund in 2001.
Saying that global contributions come to a tiny fraction of what is being spent on military operations and building civilian institutions in Iraq and Afghanistan, Mr. Lewis added that if the W.H.O. program failed, "there are no excuses left, no rationalizations to hide behind, no murky slanders to justify indifference -- there will only be the mass graves of the betrayed."
While Mr. Bush promised in his 2003 State of the Union address to spend $15 billion over five years on AIDS in Africa and the Caribbean, his budget requests have fallen far short of that goal. For the most recent donation to the Global Fund, he requested only $200 million, although Congress authorized $550 million.
Nor have Europe and Asia been as generous as the fund had hoped.
Dr. Richard G. A. Feachem, a Briton who is the fund's executive director, put a brave face on the situation, describing current donations as "a steep upward flight path to our cruising altitude, which we anticipate to be $8 billion." To get there in the fund's first two years would be "inconceivable," he added. He is lobbying Congress for $1.2 billion for 2005.
At the same time, few people in poor countries have been able to get lower-priced generic antiretroviral drugs. While the generic drugs have been approved by the W.H.O., endorsed by the World Bank and used in several African countries, the Bush administration has so far paid only for medicines that are still under patent and cost much more.
For example, Daniel Berman, co-director of the Doctors Without Borders campaign for low-cost drugs, said that in Zimbabwe his organization planned to treat 1,000 patients with drugs from two approved Indian generic makers, Cipla Ltd. and Ranbaxy Laboratories Ltd.
Both companies combine three antiretrovirals so that a day's dose is just two pills and the cost is $244 to $292 per patient per year. Meanwhile, Mr. Berman said, the Centers for Disease Control in Atlanta plans to pay for the treatment of 1,000 Zimbabweans, buying the same three drugs separately from GlaxoSmithKline, Bristol-Myers Squibb and Boehringer-Ingelheim. The best prices available in Africa from those companies, he said, add up to $562 a year, and a daily dose is six pills.
Advocates of cheap drugs say the Bush administration has yielded to pressure from the pharmaceutical lobby to find ways to reject the generics.
On Friday, Senators Edward M. Kennedy, Democrat of Massachusetts, and John McCain, Republican of Arizona, wrote a joint letter to the White House urging it to accept W.H.O.-approved generics.
In a separate letter, Representative Henry A. Waxman, Democrat of California, accused the administration of trying to set standards for Indian generics higher than those for American ones.
A spokesman for Randall L. Tobias, the administration's AIDS coordinator, said any suggestion that he was snubbing generics was "utter nonsense."
"We will buy whatever drug is safe and effective at the lowest possible price," said the spokesman, Dr. Mark R. Dybul. "We don't care if it's made by Cipla or Ranbaxy, in South Africa or Brazil or Nigeria."
Mr. Tobias has scheduled a meeting in Botswana for Monday to ascertain whether the W.H.O.'s approval process is rigorous enough.
Dr. Lembit Rago, who leads the W.H.O. assessments, said he used "absolutely the same principles" as the Food and Drug Administration, and borrowed his inspectors from regulatory agencies in Canada, France, Germany, Sweden and Switzerland. As soon as his office approved the Indian pills, he said, "a very cold wind began to blow from the U.S."
"It is no secret that Pharma is lobbying against us in a big way," he said.
A spokesman for the Pharmaceutical Research and Manufacturers Association of America, the industry's American lobbying group, said his association was "not involved in any way in this." But he called the Indian drugs "new combinations that have not been appropriately treated."
Dr. Dybul said Mr. Tobias wanted to see all the data the Indian companies gave the W.H.O.
A W.H.O. spokeswoman said the agency signed confidentiality agreements, but she said the Bush administration could ask the Indian companies for the data.
Against that backdrop, prices for both branded and generic medicines have plunged in the last two years. Last October, a foundation organized by former President Bill Clinton announced an agreement with Indian and South African generic makers to sell the drugs for $140 per patient per year if large orders were guaranteed, payment was in cash and the drug maker did not have to pay the legal and lobbying costs of getting each drug licensed in each country.
In January, Mr. Clinton announced that he had brokered another price-cut deal with five companies making AIDS tests. One of the companies, Becton, Dickinson & Company, dropped the cost of its CD-4 count, which measures immune cells, to as little as $3, from a high of $10.
On Dec. 9, with little fanfare, an important step took place in South Africa. Two pharmaceutical giants, Glaxo and Boehringer-Ingelheim, agreed to grant licenses to produce AIDS drugs to four generic companies from India and South Africa.
The companies will be allowed to sell the drugs anywhere in sub-Saharan Africa. In return, Glaxo and Boehringer will get royalties of 5 percent of sales. Under the threat of heavy fines, the companies had backed down from their original plan: a license for one small generic maker supplying only South Africa's public hospitals and royalties of 15 percent to 30 percent.
The Canadian government has proposed a law encouraging its drug makers to make cheap copies of drugs to treat AIDS and malaria for export to poor countries. The bill is bogged down in Parliament.
Treatment plans have varied wildly in different countries. South Africa, with the world's largest number of AIDS patients, was slow to roll out nationwide treatment because of years of opposition by President Thabo Mbeki. India, which has the second largest number, has been slow to negotiate low prices with its own generic companies. Brazil makes its own generic drugs. Romania buys only brand-name drugs, but its epidemic is confined to about 10,000 people.
Nigeria, Africa's most populous country, has had trouble running even so much as a pilot program for 15,000 of an estimated 3.5 million infected people. Many of the country's 25 treatment centers, which were selling the drugs at a subsidized price of $85 a year, ran dry in September and did not get new supplies until February.
Malaysia is the only country to exercise a "compulsory license" right under trade treaties to ignore a patent and import generics, said James P. Love, director of the Consumer Project on Technology, a group that is pushing for cheaper drugs. Uganda, Mozambique and Zambia may soon do the same, he said, but China backed away from doing so for fear of American trade retaliation. "They're using older drugs that are already off patent in China," he said.
Copyright 2004 The New York Times Company
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>> TERROR FILES...

Imam Not Allowed To Attend Va. Meeting
By Timothy Dwyer and Jerry Markon
Washington Post Staff Writers
Saturday, March 27, 2004; Page A11
A federal judge yesterday rejected a Cleveland imam's request to travel to Northern Virginia for what prosecutors said was a meeting with a group with ties to terrorists.
The imam, Fawaz Damra, faces federal charges in Ohio that he lied on his citizenship forms by concealing his affiliation with several terrorist groups, including Palestinian Islamic Jihad. He had asked a judge earlier this week for permission to travel to Springfield for a meeting last night sponsored by the United Association for Studies and Research Inc., or UASR.
The group says it is a Muslim American think tank, but federal prosecutors and congressional investigators have linked it to terrorist groups, primarily the Islamic Resistance Movement, or Hamas, court records and interviews show. Hamas has been designated a terrorist organization by the U.S. government.
Anisa Abd el Fattah, director of public affairs for UASR, said the organization is not tied to Hamas or any other terrorist group. She said last night's meeting at the UASR offices was the first in a series that would lead to "a structure for what we hope is going to be Muslim-Jewish dialogue between Muslim and Jewish leaders in the United States."
Local Muslim leaders and imams were planning to attend last night's meeting, she said. Future meetings, she added, would include Jewish community leaders.
In documents filed this week in U.S. District Court in Cleveland, Damra's attorneys described the meeting as "a panel discussion between Rabbis and Imams at an Interfaith meeting." Damra is required under terms of his bail to request permission to travel.
Damra, the imam of the Islamic Center of Cleveland, also known as the "grand mosque," was indicted by a federal grand jury in December on one count of naturalization fraud. A trial date has not been set.
Prosecutors allege that Damra did not disclose his ties to Islamic Jihad, which has claimed responsibility for bombings and other terrorist acts in Israel. Law enforcement sources said Damra was formerly the head of al-Farooq mosque in Brooklyn, N.Y., whose adherents include men convicted in the first bombing of the World Trade Center in 1993 and Omar Abdel Rahman, the "blind sheik" who was convicted along with nine others in a plot to blow up Manhattan landmarks including the United Nations.
An attorney for Damra, who has pleaded not guilty, did not return telephone calls yesterday.
In response to Damra's travel request, Gregory A. White, the U.S. attorney in Cleveland, filed a memo saying he "strongly opposes" granting it because UASR "has demonstrated its sympathies for Hamas." He added that several "key associates" of the Springfield group "are, or have been, integrally involved in Hamas activities."
Among those, prosecutors said, is Mousa Abu Marzook, a Hamas leader and Gaza native who lived in Northern Virginia until 1993 and was designated a terrorist by the U.S. government in 1995.
El Fattah said Marzook founded UASR but did not begin his affiliation with Hamas until five years later and has not been involved with UASR since at least 1996. She added that Marzook's wife and children still attend UASR's functions.
Another former UASR official is Abdurahman Alamoudi, a prominent Muslim activist indicted in federal court in Alexandria in October on money laundering and fraud charges. Among the charges is that Alamoudi lied on his citizenship forms by not revealing his role as a "director" of UASR.
After the judge rejected Damra's request to travel to Springfield, his attorneys filed another motion saying he was "unaware of any of the facts" alleged by prosecutors.
UASR is also one of the dozens of Muslim charities and foundations for which Senate Finance Committee investigators are seeking tax and financial records. The records were requested as part of a widening probe into alleged ties between tax-exempt organizations and terrorist groups, according to documents and federal officials.


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WAR ON TERRORISM | VENEZUELA
IDs easily bought in Venezuela could aid terrorists, U.S. fears
U.S. officials worry that Venezuela's trade in fake identification documents could help terrorists and other criminals hide their identities.
BY ALFONSO CHARDY
achardy@herald.com
CARACAS - Juli?n runs a small office supply shop in downtown Caracas, but his main income comes from the dilapidated government immigration offices nearby.
Juli?n readily admits that he moonlights as a purveyor of fraudulent Venezuelan passports and national identity cards, and an expediter of real ones.
And he gladly ticks off the prices he offers, usually to illegal immigrants: about $260 for a fake passport and $80 for a fake national identity card known as a cedula. It's a lot more for real ones, depending on how fast his clients want them.
In the post-Sept. 11 era, Venezuela's trade in false documents has alarmed U.S. officials, in light of allegations that leftist President Hugo Ch?vez's government has issued fake IDs to leftist guerrillas in neighboring Colombia, Arabs with suspicious backgrounds and Cuban intelligence agents.
The trade is indeed widespread and at times worrisome, a month-long Herald review of the allegations found.
Two Venezuelan Muslims -- one who attended two of the same U.S. aviation schools as one of the Sept. 11 hijackers, another arrested with a grenade in London -- may have false documents, the former head of Venezuelan immigration told The Herald.
But the trade has been going on for decades, mainly linked to corrupt employees in the immigration department, known by its Spanish acronym DIEX, and apparently has not increased significantly under Ch?vez, The Herald also found. Ch?vez has denied the allegations.
`HISTORIC PRACTICE'
''I've been doing this long before Ch?vez became president,'' said Juli?n, who asked that his last name not be published. ``It's a traditional, historic practice in our country.
U.S. officials said their main fear is that Islamic radicals, hiding their true identities with Venezuelan documents, could slip into the United States, past terrorist ''watch lists,'' and stage another Sept. 11-style attack.
''The sale of cedulas and passports . . . did not start with Ch?vez. But we are more concerned now because terrorists can exploit a corrupt system to hurt us,'' said a top U.S. government official familiar with Venezuela.
Washington already has taken action. In recent months, the U.S. Consulate in Caracas has denied visas to Venezuelans carrying flimsy ''temporary'' passports or regular passports that were renewed multiple times after the initial expiration date of five years.
RAN OUT
Stuart Patt, a State Department spokesman, said the single-sheet temporary passports were issued by the Venezuelan government in the last few months after it ran out of the more secure regular passports.
''In general,'' Patt said, ``Venezuelan passports are not very reliable documents. They are susceptible to fraudulent use.''
Colombian officials, who have long alleged that Ch?vez is helping the guerrillas, say that scores of the rebels killed or captured near the eastern border with Venezuela were carrying Venezuelan cedulas.
''We know they can buy them easily there,'' one army general in Bogot? said recently. ``They can buy them easily here, too, by God. We Colombians are famous around the world for making false documents.''
''But there's so many of them these days that we have to ask: Is it a business or is it a policy?'' the general added.
The cedula is the primary national identification document in Venezuela, serving as proof of birth for Venezuelans and residency for foreigners.
PAPERS FOR BRIBES
But retired national guard Gen. Marco Antonio Ferreira, who resigned as head of DIEX in April 2002, said that some of the agency's branch offices outside Caracas long have issued cedulas to illegal migrants in exchange for bribes.
He gave The Herald a computerized list of more than 3,000 names of people holding what he suspects are real but fraudulently obtained documents.
They carry the numbers for blank cedulas that were sent to provincial branches but then ordered withdrawn for a number of reasons, chief among them that the branches had a surplus of blank forms, Ferreira said.
MIDDLE EAST NAMES
Ferreira's lists of suspect cedulas included more than 300 people with Middle Eastern names. A U.S. Homeland Security Department official checked the names against a terrorist watch list and found no matches.
But Ferreira said he suspected that the Venezuelan ID cards carried by Hakim Mohamed Ali Diab Fattah and Hazil Muhammad Rahaman Alan were false. Venezuelans are required to obtain cedulas at age 7. Ferreira said the two Muslims obtained theirs when they were 19 and 24.
Diab Fattah, 30, was detained in the United States after taking lessons at two of the same aviation schools attended by Sept. 11 hijacker Hani Hanjour. He was deported to Venezuela in 2002. Rahaman, 38, was arrested in London last year after a hand grenade was found in his luggage at Gatwick airport. He is awaiting trial there.
'EXPRESS' RESIDENCY
Concerns over Venezuela's ID system deepened in January when the Ch?vez government implemented a new immigration initiative: ''express'' residency and naturalization for foreign nationals living illegally in Venezuela.
Opposition leaders said the system will compromise the nation's security and that Ch?vez is only trying to increase the number of voters who may support him if electoral officials approve the recall referendum against Ch?vez sought by his political opponents.
But Venezuelan immigration officials argue that legalizing longtime illegals strengthens national security -- the same argument President Bush used recently when he proposed granting temporary work permits to illegal immigrants.
'SAFEGUARD' SECURITY
''Regularization is a policy which will not only resolve the situation of illegal foreigners but will also seek to safeguard the security of the state,'' Hugo Cab?zas, current head of DIEX, was quoted as saying recently by the Caracas daily El Universal.
Thousands of illegal migrants signing up for the express program -- most of them Colombians who fled here when their country was awash in political bloodshed and Venezuela's oil-fueled economy was humming along -- now mob the DIEX building almost daily.
And for those not willing to stand in line, there are still many fake-ID dealers nearby like Juli?n, known here as gestores, Spanish for brokers or middlemen.
``Many of the businesses around the DIEX have gestores. Here, I photocopy documents, and others plastify the cedulas. But thats just part of what we really do. Many people around here survive on selling cedulas and passports.
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VENEZUELA | TERROR SUSPECTS
A pair of arrests illustrates problem
CARACAS - The cases of two Venezuelan Muslims arrested in the United States and London illustrate the unreliability of the country's national identification card system.
If they were not who their documents said they were, who were they?
* Hakim Mohamed Ali Diab Fattah. Carries Venezuelan National ID card No. v16.105.824, issued in 1993, identifying him as a Venezuelan citizen.
Detained in the United States in 2001 after he was found to have attended two of the same aviation schools as Sept. 11 hijacker Hani Hanjour.
Deported to Venezuela March 8, 2002, four days after the U.S. Embassy in Caracas sent a letter to the Venezuelan government saying he had violated U.S. immigration laws and that an FBI investigation had shown he had ``threatened that he was going to blow up an Israeli airliner.''
U.S. officials familiar with the case said they were confident that U.S. investigators thoroughly checked his background and found him not to be a threat.
His identification card, issued in the Caribbean town of Maiquetia, shows he would be 30 years old now. He is believed to be of Palestinian descent.
But former Venezuelan immigration department chief Marco Antonio Ferreira said he suspected the ID was fraudulently obtained because Diab was 19 when it was issued. Venezuelans usually obtain ID cards at age 7 to register for school.
His whereabouts are unknown.
A family member told The Herald that other relatives had taken Diab to Israel. An Israeli official said Diab had not sought a visa at the Israeli Embassy in Caracas.
* Hazil Muhammad Rahaman Alan. Carries ID card No. v6.285.604, issued in 1990.
Arrested in London last year after a hand grenade was found in his luggage at Gatwick airport, he is awaiting trial there. Media reports say he visited Afghanistan and Sudan, two former Al Qaeda strongholds.
Rahaman obtained his ID card at age 24. Ferreira said he has more suspicions about him because the records backing up his ID card application ``appear to have been extracted from the files.''
Rahaman is believed to be of Southeast Asian descent, and his family has a home in the well-to-do Caracas district of El Cafetal. The home is now empty.
A neighbor told The Herald that Rahaman's mother had told him shortly after the arrest in London that her son had disappeared eight or nine years ago and not been heard from.
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Uribe sees Bush, hopes aid follows
BY FRANK DAVIES
fdavies@herald.com
WASHINGTON - President Alvaro Uribe of Colombia ended a four-day visit Thursday with an upbeat assessment of his country's progress against drugs, guerrillas and economic woes.
After his third meeting with President Bush in two years, Uribe said he is grateful for $2.5 billion in U.S. aid since since 2000, adding that the so-called Plan Colombia is helping to improve security and reduce coca cultivation.
Aggressive eradication efforts have reduced coca cultivation by 33 percent in the last two years, according to a State Department report released during Uribe's visit.
''These are credible numbers, but we are not bragging,'' Uribe told an audience at the National Press Club. ``These are just the first results, and I am not satisfied.''
Colombian officials said they also have high hopes for free-trade talks with the United States, scheduled to begin in May.
And this week Gen. James Hill, chief of the Miami-based U.S. Southern Command, asked Congress to raise the limit on the U.S. presence in Colombia to 800 military personnel and 600 civilian contractors. The current cap is 400 of each.
With recent Colombian advances against guerrilla groups, Hill said he saw a chance, with increased training and support, to ``deal a decisive blow against narco-terrorists.''
Uribe said that improved security was his top concern and essential to luring investment and improving democratic institutions. He quoted the former Socialist leader of Spain, Felipe Gonzalez, who once told him, ``Security is a democratic value.''
Asked about support for the U.S. war in Iraq, Uribe ducked the question. But he said the war is part of a larger global conflict with terrorism.
He faced critical questions on Capitol Hill about his efforts to make peace with several hundred members of the United Self-Defense Forces of Colombia, or AUC, an illegal paramilitary group widely accused of brutality in fighting leftist guerrillas.
Several House members said the agreement could protect human rights abusers, but Uribe said he was trying to reintegrate the AUC fighters into society.

A Guide to the New 2004 Social Security Trustees' Report
by David C. John
WebMemo #459

March 25, 2004
On March 23, 2004, the latest annual report of the Social Security's Trustees was released to the public. Most stories about this report focused on obvious facts such as when the trust fund will run out. However, there is much more to the story than just those dates. This briefing gives you an idea of how to get to the important facts behind the obvious in order to get a real picture of Social Security's financial outlook.
What is the Trustees' Report?
Every year, the Social Security Act requires the Trustees of the Social Security trust funds to issue a report on the financial status of those trust funds. This report includes not only current financial information, but also projections about the funds' ability to finance promised benefit payments in the future. If the report shows that the trust funds will be unable to finance all of these payments (as all recent reports have), the law requires the Trustees to recommend ways to make up the shortage. However, this requirement is regularly ignored.
The Trustees include the Secretaries of Treasury, Labor, and HHS, the Social Security Administration Commissioner and Deputy Commissioner, and two public trustees appointed by the President and confirmed by the Senate. The public trustees are Thomas R. Saving of Texas A & M University and John L. Palmer of Syracuse University. They were nominated to a five-year term by former President Bill Clinton in 2000 and were approved by the Senate later that year.
The 2004 Report is the third to include the full input of these public trustees and continues to include a great deal of additional information that was not available in previous reports. Both trustees have spoken about the need to include more and clearer information so that the public can fully understand the state of the Social Security trust fund and the financial challenges that lie ahead. This year's Report again shows the results of their efforts.
What does it all mean?
Good news for seniors. The benefits of current retirees and those close to retirement are completely safe. The 2004 Report shows that the program will have enough resources to pay full benefits until 2018. Despite political scare tactics, seniors can rest assured that their benefits are safe.
Bad news for younger workers. Unfortunately, younger workers have a great deal to worry about. Even though their parents' and grandparents' benefits are safe, theirs are not. Any worker born after 1975 will reach full retirement age after the trust fund is exhausted. Unless Congress acts soon, they can look forward to paying full Social Security taxes throughout their careers but only receiving 73 percent or less of the benefits that have been promised to them. In addition, they will have to pay about $5 trillion (in today's dollars) in additional general taxes in order to repay the Social Security trust fund.
Social Security must be reformed. The Report shows that today's Social Security cannot last. Over time, the system has promised almost $26 trillion (in 2004 dollars) more in benefits than it will have the ability to pay. Just repaying the amount that will be in Social Security's trust fund will cost over $5 trillion.
Delay makes it even harder to reform Social Security. Every year, there is one less year of surplus and one more year of deficit. Once those deficits start in 2018, the Trustees' Report shows that they will never end. Each year, with the disappearance of another year of surplus, reforming Social Security gets more expensive.
Delay will make it harder to run the rest of the government. If Social Security is not reformed, by 2030 it will require almost 13 percent of all income taxes collected that year in addition to what the program would receive from its payroll taxes to pay all promised benefits. By 2040, that number will surpass 15 percent of all income taxes and it will continue to grow after that. This will make it much harder for our children and grandchildren to pay for government programs dealing with national security, health, education, and the environment.
Personal retirement accounts must be established. Allowing American workers to invest a portion of their existing Social Security taxes in an account that they would own is the lowest cost way to ensure that they have an adequate retirement income. The alternative is a combination of benefit cuts and tax increases. Without personal retirement accounts, workers will end up paying more taxes for less benefits. Polls consistently show that a large majority of Americans support President Bush's plan to establish such accounts.
False lessons that should be avoided
President Bush's tax plan makes Social Security worse. Cutting taxes will not make it harder to pay for Social Security's coming deficits. Social Security will take in more cash than it pays out for about fourteen years. Without the growth that will be stimulated by the President's tax plan, future Congresses will face a much harder task in either reforming Social Security or paying for its deficits.[1]
Repealing President Bush's tax cuts will make it easier to pay for Social Security. Repealing tax cuts today will not make it easier to pay for Social Security in the future. Social Security does not need any additional cash to pay benefits for about another fourteen years. During the interim, Congress will just spend the additional money on new programs, and by the time it might be used to pay benefits, every dollar will be committed to new "essential" programs that cannot be cut.
Social Security's problems are so far in the future that we don't need to worry about them. It takes about 22 years to grow a taxpayer. Almost every new taxpayer who will begin a new career after graduating from college in 2025 is living today and can be counted. Similarly, everyone who will receive Social Security retirement benefits in the year 2040 is alive and most of them are paying taxes. Social Security's problems are based on demographics, which don't change from year to year. The people who will be hurt if nothing is done to fix Social Security are not fantasy people of the future. They are our children and grandchildren of today.
What is easy to find in the Report
When Social Security will begin to run a cash-flow deficit. The most recent estimates on when the trust fund will begin to spend more money in benefits than it receives in taxes is usually found in the accompanying press release and in the front of the Trustees' Report. It also includes the latest estimate of when the trust fund will be exhausted. According to the new 2004 Report, the year that Social Security will begin to spend more in benefits than it receives in payroll taxes remains at 2018 - the same year that was in last year's Report. The year the "trust fund" is exhausted also stays the same at 2042.
Operating numbers from the current year: The Trustee's Report includes detailed information about the aggregate amount of payroll taxes paid in the just ended calendar year and the aggregate amount of benefits of different types paid in that year. It also includes data on operating expenses. In 2003, the Old-Age and Survivors Trust Fund (which pays for retirement and survivor's benefits) took in $543.8 billion and paid out $406.0 billion. The annual surplus was $137.8 billion.
Dozens of charts and tables: Literally dozens of various technically labeled charts and tables are scattered through the Trustees' Report. Unfortunately, their actual meaning is usually much less clear.
What you will have to search for
The Meaning of All Those Charts. So far, the Trustees have used three scenarios to project Social Security's financial future. The middle scenario, which is the most likely to occur, is usually cited. The Trustees have also included both a more optimistic projection and a more pessimistic projection. Although all three are listed, it is not correct to assume that there is an equal chance that each might occur. It would be far more correct if the Trustees also included the likelihood that each would occur.
However, hidden in the details of those charts is some critical information:
Social Security spending will exceed projected tax collections in 2018. These deficits will quickly balloon to alarming proportions. After adjusting for inflation, annual deficits will exceed $100 billion within about five years, $200 billion after about ten years, and $300 billion after about fifteen years.
Between 2018 and 2079, the cumulative unfunded liability (the amount more that Social Security will have to pay in benefits during that period than it will receive in payroll and other taxes) is projected to be about $25.85 trillion (in 2004 dollars). This is more than six times the national debt.
In net present value terms, Social Security owes $5.2 trillion dollars more in benefits than it will receive in taxes. That number includes $1.5 trillion, in net present value terms, to repay the bonds in Social Security's trust fund. This is an almost 6 percent increase from last year.
Net present value measures the amount of money that would have to be invested today in order to have enough money on hand to pay deficits in the future. In other words, Congress would have to invest $5.2 trillion today in order to have enough money to pay all of Social Security's promised benefits between 2018 and 2079. This money would be in addition to what Social Security receives during those years from its payroll taxes.
A new perpetual projection that extends beyond the usual 75-year planning horizon. In net present value terms, the perpetual projection is $11.9 trillion, including money necessary to repay bonds in the trust fund. Those projections show that Social Security's total deficit continues to grow well beyond the 75-year projection period. Any reform that just eliminates deficits over the 75-year window will not be sufficient to solve the program's problems. The current system would run into renewed deficits after the 75-year window ends.
This is important because many opponents of reform claim that raising payroll taxes by about 2 percent, the average percentage difference between revenues and outlays over the 75-year period, would solve Social Security's problems. The reality, however, is that the program's future deficits are projected to be so large that this tax increase would still leave a huge shortfall. These new projections should end the claims that Social Security's impending financial crisis can be resolved with modest changes to the current system.
What needs to be in the Report, but has not appeared so far
Specific information on the program's total long-term outlook. The Report should specify the long-term unfunded liability of Social Security in nominal and inflation-adjusted dollars, as well as any changes in the unfunded liability from year to year, using the SSA's own data. This year's Report offers improved information, but there is still a long way to go. With this information, working Americans could balance any short-term "improvements" in Social Security's financial future with the higher deficits their children and grandchildren will have to pay.
A measure of workers' rate of return. The Trustees' Report does not include any measure of what workers actually receive for their payroll taxes. The best way to accomplish this would be to include a chart in the Report that plots implicit rates of return by birth year. Similar to a chart found in the GAO's August 1999 report on Social Security's rate of return, this chart would illustrate to Americans that the rate of return from Social Security has steadily and dramatically decreased. For instance, GAO's chart shows that a worker born around 1920 could expect a rate of return from Social Security taxes of about 7 percent after inflation. On the other hand, a worker born in mid-1980s could only expect a return of under 2 percent. If they were provided with these figures, workers would see that, unless the current system is reformed, they can expect a lower rate of return on their taxes than their parents and grandparents received. More important, they can see that their children and grandchildren will receive even less from Social Security.
Information on the nature of its trust funds and how they differ from private-sector trust funds. The Office of Management and Budget explained in its fiscal year 2000 budget document that the Social Security "trust funds" do not contain stocks, bonds, or other assets that could be sold directly for cash. Unlike private-sector trust funds, the Social Security trust funds contain only IOUs that will have to be paid back with future taxes. As OMB noted,
These balances are available to finance future benefit payments...only in a bookkeeping sense. They do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury that, when redeemed, will have to be financed by raising taxes, borrowing from the public, or reducing benefits, or other expenditures.
Information used to make projections, including economic models and the relevant data analyzed. Social Security's trustees also should clearly disclose any changes made in these models during the previous year. This disclosure would allow independent researchers to verify the SSA's projections.
How does Social Security operate?
For a briefing on how Social Security operates, how the trust fund works, how benefits are calculated, and other features of the current system and reform options, please see Social Security Basics.

[1] For a further discussion, please see President Bush's Tax Plan Would Improve the Ability to Deal with Future Social Security Deficits.

David C. John is Research Fellow in Social Security and Financial Institutions in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation.
? 1995 - 2004 The Heritage Foundation
All Rights Reserved.

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Providing Social Security Benefits in the Future: A Review of the Social Security System and Plans to Reform It
by David C. John
Backgrounder #1735
March 25, 2004 | Executive Summary | |
Social Security is the best-loved American government program, but how it works and is financed is almost completely unknown. Most Americans have a vague idea that they pay taxes for their benefits and that their benefits are linked somehow to their earnings. Many also know that the program is in trouble and needs to be "fixed" sometime soon to deal with the retirement of the baby boomers. Beyond this, their knowledge of the facts is severely limited and often colored by rumors and stories.
Most politicians exploit this lack of knowledge and limit their statements on Social Security to platitudes and vague promises. To make matters worse, reformers tend either to be content with similar platitudes or to speak in such detail that few outside the policy world can understand what they are saying. The simple fact is that today's Social Security is extremely complex, and any reform plan that is more than fine words will be similarly complex.
This paper attempts to simplify the reform debate by comparing various plans (including the current system) side by side. Each of the six sections of this paper compares how the current system and the reform plans handle a specific subject. Only reform plans that have been scored by Social Security's Office of the Chief Actuary are included in this comparison, using numbers contained in the 2003 Report of the Social Security Trustees. The six corresponding tables contain general reviews of aspects of the current system and the reform plans, with more details in the footnotes.
While looking at just one or two sections of special interest may be tempting, this approach would probably be misleading. For the best effect, each section should be considered together with the other sections in order to form a complete picture of the plan. Using simply one section by itself to judge an entire plan will not yield an accurate result.
Seven Important Rules for Real Social Security Reform
Information in this side-by-side comparison is based on Social Security's scoring memos for each plan and conclusions that can be drawn from information contained in those memos. While there are many good points in the reform plans examined in this analysis, this is not an endorsement of any proposal by the author or The Heritage Foundation. Instead, this comparison provides details of specific plans. However, it would be wise for reformers to follow a set of general principles to ensure that any Social Security reform both resolves Social Security's problems and provides workers with greater retirement security. Those principles are listed below.
This comparison of plans makes no effort to examine whether the Social Security reform plans included in it meet or violate any or all of the principles.
Principles for Social Security Reform:
The benefits of current retirees and those close to retirement must not be reduced. The government has a moral contract with those who currently receive Social Security retirement benefits, as well as with those who are so close to retirement, that they have no other options for building a retirement nest egg. If the benefits of younger workers cannot be maintained given the need to curb the burgeoning cost of the program, then they should have the opportunity to make up the difference by investing a portion of their Social Security taxes in a personal retirement account.
The rate of return on a worker's Social Security taxes must be improved. Today's workers receive very poor returns on their Social Security payroll taxes. As a general rule, the younger a worker is or the lower his or her income, the lower his or her rate of return will be. Reform must provide a better retirement income to future retirees without increasing Social Security taxes. The best way to do this is to allow workers to divert a portion of their existing Social Security taxes into a personal retirement account that can earn significantly more than Social Security can pay.
Americans must be able to use Social Security to build a nest egg for the future . A well-designed retirement system includes three elements: regular monthly retirement income, dependent's insurance, and the ability to save for retirement. Today's Social Security system provides a stable level of retirement income and does provide benefits for dependents. But it does not allow workers to accumulate cash savings to fulfill their own retirement goals or to pass on to their heirs. Workers should be able to use Social Security to build a cash nest egg that can be used to increase their retirement income or to build a better economic future for their families. The best way to do this is to establish, within the framework of Social Security, a system of personal retirement accounts.
Personal retirement accounts must guarantee an adequate minimum income . Seniors must be able to count on a reasonable and predictable minimum level of monthly income, regardless of what happens in the investment markets.
Workers should be allowed to fund their Social Security personal retirement accounts by allocating some of their existing payroll tax dollars to them. Workers should not be required to pay twice for their benefits--once through existing payroll taxes and again through additional income taxes or contributions used to fund a personal retirement account. Moreover, many working Americans can save little after paying existing payroll taxes and so cannot be expected to make additional contributions to a personal account. Thus Congress should allow Americans to divert a portion of the taxes that they currently pay for Social Security retirement benefits into personal retirement accounts.
For currently employed workers, participation in the new accounts must be voluntary. No one should be forced into a system of personal retirement accounts. Instead, currently employed workers must be allowed to choose between today's Social Security and one that offers personal retirement accounts.
Any Social Security reform plan must be realistic, cost-effective and reduce the unfunded liabilities of the current system. True Social Security reform will provide an improved total retirement benefit. But it should also reduce Social Security's huge unfunded liabilities by a greater level than the "transition" cost needed to finance benefits for retirees during the reform. Like paying points to obtain a better mortgage, Social Security reform should lead to a net reduction in liabilities.
The Social Security System and Plans
for Reform
The Current System
Social Security currently pays an inflation-indexed monthly retirement and survivors' benefit, based on a worker's highest 35 years of earnings. Past earnings are indexed for average wage growth in the economy before calculating the benefit. The benefit formula is progressive, meaning that lower-income workers receive a benefit equal to a higher proportion of their average income than upper-income workers receive. The program is expected to continue to collect more in payroll taxes than it pays out in benefits until about 2018.
Unused payroll taxes are borrowed by the federal government and replaced by special-issue Treasury bonds. After the system begins to pay out more than it receives, the federal government will cover the resulting cash flow deficits by repaying the special-issue Treasury bonds out of general revenues. When the bonds run out in about 2042, Social Security benefits will automatically be reduced to a level equal to incoming revenue. This is projected to require a 27 percent reduction in 2042, with greater reductions after that.
The DeMint Plan
Representative Jim DeMint (R-SC) has introduced a voluntary personal retirement account (PRA) plan that would establish progressively funded voluntary individual accounts for workers under age 55 on January 1, 2005. The amount that goes into each worker's account would vary according to income, with lower-income workers able to save a higher percentage. For average-income workers, the account would equal about 5.1 percent of income.
The government would pay the difference between the monthly benefit that can be financed from an annuity paid for by using all or some of the PRA and the amount that the current system promises. The sum of the annuity and the government-paid portion of Social Security would be guaranteed at least to equal benefits promised under the current system, and 35 percent of PRA assets would be invested in government bonds to help pay for any Social Security cash flow deficits. This proportion would be reduced gradually in the future. General revenue money would be used to pay for additional cash flow deficits.
The Graham Plan
Senator Lindsay Graham (R-SC) has proposed a plan that would give workers under age 55 (in 2004) three options. (Workers above the age of 55 would be required to remain in the current system and would receive full benefits.)
Under Option 1, workers would establish PRAs funded with part of their existing payroll taxes, equal to 4 percent of pay up to a maximum of $1,300 per year. Workers' benefits would be reduced by changing the benefit indexing formula from the current wage growth index to one based on consumer prices. Over time, this change would reduce benefits for workers at all income levels, but the effect on lower-income workers would be eased by a mandated minimum benefit of at least 120 percent of the poverty level for workers with a 35-year work history. The government-paid monthly benefit would be further reduced to reflect the value of the PRA. This reduction would be calculated using the average earnings of government bonds so that, if the PRA earned more than government bonds, the total monthly benefit would be higher. Option 1 also raises survivor benefits to 75 percent of the couple's benefit for many survivors.
Option 2 is essentially the same as Option 1, but without PRAs. The government would pay all benefits for workers who choose this option. Option 2 includes both the basic benefit reduction and the minimum benefit requirement.
Option 3 pays the same level of benefits promised under current law, but workers who select this option would pay higher payroll taxes in return. Initially, the payroll tax rate for retirement and survivors' benefits would increase from 12.4 percent of income to 14.4 percent of income (counting both the worker's and the employer's shares of the tax). In subsequent years, the tax rate would continue to climb in 0.25 percent increments.
The Smith Plan
Representative Nick Smith (R-MI) has proposed a voluntary PRA plan that would create personal retirement savings accounts funded with an amount equal to 2.5 percent of income, paid out of existing payroll taxes. This would increase to 2.75 percent of income in 2025 and could become larger after 2038 if Social Security has surplus cash flows. Retirement and survivors' benefits would be reduced by an amount equal to the value of lifetime account contributions plus a specified interest rate.
The Smith plan would also make many changes in Social Security's benefit formula, mainly affecting middle-income and upper-income workers. These changes would eventually result in most workers receiving a flat monthly benefit of about $550 in 2004 dollars. It would also gradually increase the retirement age for full benefits and require that all newly hired local and state workers be covered by Social Security. The Smith plan transfers $866 billion from general revenues to Social Security between 2007 and 2013 to help cover cash flow deficits and allows additional general revenue transfers when needed after that.
The Ferrara Plan
Peter Ferrara, Director of the International Center for Law and Economics, has proposed a plan that would create voluntary PRAs that would be funded according to a progressive formula that allows lower-income workers to save a higher proportion of their payroll taxes than upper-income workers. Average-income workers could save about 6.4 percent of their income. Workers would be guaranteed that the total of their PRA-generated benefits and government-paid monthly benefits would at least equal the benefits promised under the current system.
Any Social Security cash flow deficits that remain would be financed through general revenue transfers equal to a 1 percent reduction in the growth rate of all government spending for eight years, the corporate income taxes deemed to result from the investment of personal account contributions, and issuing about $1.4 trillion in "off-budget" bonds. Under the Ferrara plan, these bonds would be considered a replacement for the existing system's unfunded liability and thus would not increase the federal debt.
The Orszag-Diamond Plan
Peter Orszag, Senior Fellow at the Brookings Institution, and Peter Diamond, Institute Professor of Economics at the Massachusetts Institute of Technology, have developed a plan that does not include any form of PRA or government investment of Social Security trust fund money in private markets. Instead, it gradually changes the benefit formula to reduce benefits for moderate-income and upper-income workers and requires that all state and local government workers come under Social Security. It would also gradually reduce benefits by raising the age at which workers could receive full benefits. Workers could still retire earlier, but at lower benefits. Benefits would increase for lower-income workers, widows, and the disabled.
In addition, the plan would gradually increase the payroll tax for all workers from the current 12.4 percent of income to 15.36 percent of income in 2078. It would also raise the earnings threshold on Social Security taxes--thus requiring higher-income workers to pay additional payroll taxes--and impose a new 3 percent tax on income above the earnings threshold. Workers would not receive any credit toward benefits for income covered by this new tax.
Statements by the SSA Chief Actuary's Office on Each Reform Plan
The Social Security Administration has evaluated each of the reform plans.
The DeMint Plan. "Under plan specifications described below the Social Security program would be expected to meet its benefit obligations throughout the long-range period 2003 through 2077 and beyond."1
The Graham Plan. "[A]ll participation levels would be expected to result in sustainable solvency for the foreseeable future, as trust fund ratios are projected to be rising substantially at the end of the 75-year projection period."2
The Smith Plan. "Enactment of this proposal, assuming universal participation in Option 1, is expected to eliminate the estimated long-range OASDI [Old-Age, Survivors, and Disability Insurance] actuarial deficit (1.92 percent of taxable payroll under present law) based on "intermediate" assumptions described below and to result in sustainable solvency for the foreseeable future."3
The Ferrara Plan. "Under the plan specifications described below the Social Security program would be expected to be solvent and to meet its benefit obligations throughout the long-range period 2003 through 2077 and beyond."4
The Orszag-Diamond Plan. "This proposal would, through a combination of increases in taxes and coverage, reductions in the general growth of benefits levels, and certain enhancements to benefit protections, restore solvency to the OASDI program over the 75-year projection period under the intermediate assumptions of the 2003 Trustees Report. Moreover, as the projected trend in the ratio of Trust Fund assets would be stabilized and even rising slowly at the end of the period, The OADSDI program would be made sustainably solvent under these assumptions for the foreseeable future."5

1. Personal Retirement Accounts

What Is This, and Why Is It Important?
Allowing workers to invest a portion of their Social Security taxes is the only alternative to raising Social Security taxes or reducing Social Security benefits. However, personal retirement accounts are not all equal. The money that goes into the PRAs could come from diverting a portion of existing Social Security taxes or from some other source. (See Table 1.)
Similarly, the size of the accounts (usually expressed as a percentage of the worker's pay) is important. While larger accounts would temporarily increase the amount of additional funds required to pay benefits to retirees, they would also accumulate a pool of money faster than smaller accounts and finance a greater portion of benefits in future years. This can reduce the amount of additional tax dollars needed in future decades.
Finally, how the PRAs are invested is important. Even though they show steady growth over time, stocks and commercial bonds are generally more volatile than government bonds. Investing a portion of the PRAs in government bonds makes the accounts slightly less volatile while providing some of the additional dollars needed to pay benefits to current retirees.

2. Retirement and Survivors Benefits

What Is This, and Why Is It Important?
Other than creating personal retirement accounts that allow workers to self-fund all or a portion of their Social Security retirement benefits, most reform plans deal with the program's coming deficits by either changing the level of retirement benefits promised or finding ways to increase program revenues. This section examines how various reform plans treat promised retirement benefits. (See Table 2.)
Social Security uses a complex formula to calculate an individual worker's retirement benefits. Subtle changes in this formula can cause a large change in benefits over time. For instance, changing how past income is indexed to a constant purchasing power will have only a minor impact for the first several years. However, the effect is cumulative and after several decades will result in major changes in benefits.
Similarly, seemingly minor changes in "bend points"39 or other aspects of the benefit formula can, over the long term, cause major changes in benefits for upper-income and/or moderate-income workers. It is even possible to use the benefit formula to approximate an increase in the full retirement age without actually raising it. Thus, a plan could still allow workers to qualify for "full retirement benefits" at 65, 66, or 67 but award them full retirement benefits (as defined under the current system) only if they wait to retire until a later age.
The first question that any plan must answer is whether it would pay the full level of benefits promised under the current system. If so, it must deal with how to pay the cost, since the current system cannot afford to pay for all of the promised benefits. Other important questions include whether the plan proposes benefit changes (usually reductions) if workers do not choose to have a personal retirement account, protects lower-income workers (who more often have an interrupted work history) by instituting some sort of minimum benefit level, and/or addresses the low benefits for certain lower-income, widowed, and disabled workers under the current system.

3. Payroll Taxes

What Is This, and Why Is It Important?
Increasing Social Security payroll taxes would be one way to pay projected cash flow deficits. This method is closer to the self-funding that has characterized the system so far, but raising payroll taxes has significant drawbacks. Alternatives to payroll tax increases include instituting some form of personal retirement account to increase the return on taxes, reducing benefits, and using significant amounts of general revenue money to cover Social Security's cash flow deficits. (See Table 3.)
Currently, all workers pay 5.3 percent of their income to pay for Social Security retirement and survivors benefits. In 2004, this tax will be paid on the first $87,700 of an employee's income.40 Employers match this tax for a total of 10.6 percent of each worker's income. In addition, both employer and employee pay an additional 0.9 percent of the worker's income (1.8 percent total) for Social Security disability benefits. Thus, the employer and employee pay a total Social Security payroll tax of 12.4 percent.41
Additional payroll taxes could be collected in three ways:
The overall tax rate could be increased. However, this imposes higher taxes on all income groups and could reduce employment in the economy by making it more expensive to hire additional workers.
The tax could be imposed on income levels above the threshold, currently at $87,700. In the short run, this would increase revenues, but since retirement benefits are paid on all income taxed for Social Security, it would also eventually increase the amount of benefits the system would have to pay each year and offset the amount raised through the higher taxes.
Payroll taxes could be disconnected from the benefit formula. This could take the form of a new tax paid on income above the current $87,700 earnings threshold, collecting taxes on income up to the $87,700 level but counting only income up to $60,000 or some other level toward benefits, or some combination of the two. In either case, this type of tax would break the link between taxes and income that has existed since Social Security began in 1935. To date, neither the right nor the left has been willing to break this link for fear that it would be the first step toward turning Social Security into a welfare system. Both sides have worried that such a move--or even the perception of such a move--would undermine the program's widespread support among the American people.

4. Social Security's Unfunded Liability

What Is This, and Why Is It Important?
Both the current Social Security system and every plan to reform it will require significant amounts of general revenue money in addition to the amount collected through payroll taxes. This additional money is necessary to reduce the difference between what Social Security currently owes and what it will be able to pay.
In the reform plans, the transition cost represents a major reduction from the unfunded liability of the current program. Even though the reform plans are expensive, all of them would require less additional money than the current system. However, both the amount and the timing of this additional money would vary depending on the plan. (See Table 4.)
The amount of additional money that is needed can be measured according to two different systems. Both measurements give valuable information.
Present value reflects the idea that a dollar today has more value to a person than that same dollar has sometime in the future. It gives an idea of when the additional money is needed by giving greater weight to money needed in the near future than to an equal amount needed further in the future. In addition to showing the amount of money needed, a higher present value number indicates that money is needed sooner rather than later.
The sum of the deficits indicates the total amount of additional money that will be needed. This measure gives $100 needed today the same weight as $100 needed in 15 years. This measure adds up only the future cash flow deficits; it does not include cash flow surpluses because the government does not have any way to save or invest that money for future use. Using both of these measurements gives a better picture of the situation than using just one.
Paying for the current system or any of the reform plans will require Congress to balance Social Security's needs against those of the rest of the economy. In general, as more additional dollars are needed for the current system or a reform plan, less money will be available for other government programs and the private sector.
As this burden on the general federal budget increases and persists, Congress would find it increasingly more difficult to come up with that money, and it would become increasingly less likely that such a plan would really be paid for on schedule. This is especially true for the current system, which will incur the massive deficits to pay all of the promised benefits.
The numbers used in Table 4 were calculated by the Office of the Chief Actuary using static scoringmethods. Dynamic scoring would give a more complete picture of the economic effects of each plan, allowing analysts to compare a plan's ability to create jobs, increase savings, and generate economic growth. In many cases, economic growth associated with a reform plan could increase or reduce the amount of general revenue required to finance it. Regrettably, the Social Security Administration does not offer dynamic scoring at this time.

5. Paying for Social Security's Unfunded Liability

What Is This, and Why Is It Important?
Both the current Social Security program and all of the proposed reform plans will require large amounts of general revenue money to cover the annual cash flow deficits. Exactly when that money is first needed, how many years it will be needed, and the total amount that will be needed varies from plan to plan. Avoiding use of general revenue money would require either reducing Social Security benefits enough to eliminate the annual deficits or imposing new taxes to generate sufficient revenue. Neither the current system nor any of the proposed reform plans comes close to closing the gap.
Some plans do specify sources for the needed general revenues (See Table 5.), but these are handicapped by the fact that no Congress can bind the hands of a future Congress. Thus, even if Congress did pass a plan that specified the source of the needed general revenues, a future Congress could change the plan by a majority vote. The only way to avoid this uncertainty would be for Congress to pass and the states to ratify the plan as a constitutional amendment--which would be prohibitively difficult.
In short, both the current system and all known reform plans would have to find the necessary general revenues from some combination of four sources: borrowing additional money, collecting more taxes than needed to fund the rest of the government, reducing other government spending, or reducing Social Security benefits more than is called for under either current law or any of the reform plans.
The most important thing to remember is that the existing Social Security system and the reform plans all face this problem. This is not a weakness that is limited to PRA plans or any other reform plan. The only question is when the cash flow deficits begin and how large they will be.
Current Law
Current law makes no provision for funding Social Security's unfunded liability. The program has no credit line with the U.S. Treasury, and when its trust fund promises are exhausted, current law will require it to reduce benefits.
The DeMint Plan
While some press releases connected with Representative DeMint's plan suggest that some of its general revenue needs could be generated by reducing the growth of federal spending, no language specifying where the general revenues would come from is included in his legislation.
The Graham Plan
Senator Graham's plan in-cludes a commission that would recommend reductions in corporate welfare and redirect the savings to reduce his plan's unfunded liability. At best, a reduction in corporate welfare would generate only part of the needed general revenue. The commission would produce a legislative proposal that would then be considered by Congress.
Because the commission would be created by the same legislation that implements Graham's Social Security reforms, its recommendations could not even be considered until after the plan is enacted. As a result, passage of the Graham plan does not guarantee that these revenues would be available. Regardless of what the commission recommended, a future Congress could reject the proposed cuts in corporate welfare. In that case, Congress would have to come up with another method to raise the needed revenue.
The Smith Plan
Other than the proposed benefit changes that would partially reduce Social Security's unfunded liability, the Smith plan does not specify how it would pay cash flow deficits.
The Ferrara Plan
The Ferrara plan includes three mechanisms designed to create the needed general revenues.
First, it would mandate a 1 percent reduction in the growth of all federal spending (including entitlements such as Social Security) for at least 8 years and redirect that revenue to Social Security. Since Congress cannot legally force a subsequent Congress to follow a set course of action, the only enforcement mechanism available is a constitutional amendment. As a result, the Ferrara plan simply
appropriates to Social Security the amount of revenue that would result if Congress were to reduce spending growth. In practice, a future Congress could choose not to reduce spending growth and, instead, just let the deficit grow larger or generate the necessary revenue in some other way.
Second, the Ferrara plan would transfer to Social Security the amount of corporate income taxes that could potentially result from the investment of personal accounts in corporate stocks and bonds. This is not a new or higher tax. This transfer is intended to reflect the taxes that would be paid at the current 35 percent corporate tax rate. Since SSA does not conduct dynamic scoring, this transfer is based on the static assumption that two-thirds of the stocks and bonds held through personal accounts reflect domestic corporate investment.
Third, the Ferrara plan would borrow about $1.4 trillion in special off-budget bonds. However, there is no practical way to create off-budget bonds that would not count against the federal debt. Even if there were, such a move would reduce the amount of transparency in the federal budget.
The Orszag-Diamond Plan
While the Orszag-Diamond plan includes both some benefit reductions and benefit increases for widows, the disabled, and low-income workers, the two elements of the plan are roughly equal. It reduces Social Security's unfunded liability using tax increases contained in the plan, including an increase in the payroll tax rate, a gradual increase in the amount of income subject to Social Security taxes, and a new 3 percent tax on any salary income not subject to Social Security taxes.

6. Making Social Security a Better Deal for Workers

What Is This, and Why Is It Important?
In the long run, a reform plan should do more than just preserve the current Social Security system with its many flaws. While a key requirement of any reform plan is to provide a stable, guaranteed, and adequate level of benefits at an affordable cost, it should do more. (See Table 6.)
The current system fails to allow workers to build any form of nest egg for the future. Instead, it is the highest single tax for about 80 percent of workers. In return, each worker receives a life annuity that ends with the death(s) of the worker, the surviving spouse (if there is one), or young children (if any). In today's world, where two-earner families are increasingly the norm, the current system even limits survivor benefits to the higher of either the deceased spouse's benefits or the surviving spouse's benefits. Whichever account is lower, no matter how long that spouse worked, is marked paid in full and extinguished.
At a minimum, a reform plan should allow workers to pass on some of what they earned and paid in Social Security taxes to improve their spouse's retirement benefits. It should also allow workers the flexibility to use their entire account for retirement benefits or take a smaller retirement benefit and use the balance to pay for a grandchild's college education, start a small business, or pass on money to a later generation.
In judging whether each proposed reform would be better for America's workers, readers may differ sharply. However, while most summaries and studies examine Social Security reform from the viewpoint of federal budget impact, tax rates, and the survivability of the system, few consider the overall impact of reform on the workers it was designed to benefit in the first place. Social Security should not be reformed or "saved" for its own sake, but only if it more effectively provides the benefits workers need at a price they can afford.

David C. John is Research Fellow in Social Security and Financial Institutions in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation.

1. Stephen C. Goss, Chief Actuary, Social Security Administration, "Estimated Financial Effects of H.R. 3177, the `Social Security Savings Act of 2003,'" memorandum to Representative Jim DeMint, September 26, 2003, at www.ssa.gov/OACT/solvency/DeMint_20030926.html (February 28, 2004).
2. Chris Chaplain, Actuary, and Alice H. Wade, Deputy Chief Actuary, Social Security Administration, "Estimated OASDI Financial Effects of `Social Security Solvency and Modernization Act of 2003' introduced by Senator Lindsey Graham," memorandum to Stephen C. Goss, November 18, 2003, at www.ssa.gov/OACT/solvency/LGraham_20031118 (February 28, 2004).
3. Chris Chaplain, Actuary, and Alice H. Wade, Deputy Chief Actuary, Social Security Administration, "Estimated Long-Range OASDI Financial Effect of a Proposal Developed by Representative Nick Smith," memorandum to Stephen C. Goss, September 10, 2003, at www.ssa.gov/OACT/solvency/NSmith_20030910.html (February 28, 2004).
4. Stephen C. Goss, Chief Actuary, Social Security Administration, "Estimated Financial Effects of `The Progressive Personal Account Plan,'" memorandum to Peter Ferrara, December 1, 2003, at www.ssa.gov/OACT/solvency/PFerrara_20031201.html (February 28, 2004).
5. Stephen C. Goss, Chief Actuary, Social Security Administration, "Estimates of Financial Effects for a Proposal to Restore Solvency to the Social Security Program," memorandum to Peter Diamond and Peter Orszag, October 8, 2003, at www.ssa.gov/OACT/solvency/DiamondOrszag_20031008.html (February 28, 2004).
6. Alternative sources of funds for the PRAs would require either additional savings or additional taxes. In both cases, the result would lower the overall rate of return because the worker would be paying more.
7. Some plans offer additional investment options. All stock investment options would be invested in stock index funds, not individually selected stocks. Similarly, government and commercial bond investments would be in broadly based pools of bonds rather than in individually selected bonds.
8. At least initially, all accounts are managed by a single entity offering limited investment choices. This structure significantly reduces administrative costs. In all cases, the fund management would be contracted out to a private manager by a government supervisory agency, similar to how federal workers' Thrift Savings Plan is managed. Some plans would allow workers to select another funds manager when their accounts reach a certain size.
9. Workers could contribute up to an additional $5,000 to their account. Lower-income workers could receive a matching government contribution of up to $500 for their additional contributions.
10. This is the average account size for median-income workers. Lower-income workers could put a higher percent of their income into a PRA than higher-income workers. This progressive feature approximates the current Social Security system, which gives lower-income workers higher benefits for their taxes than higher-income workers receive.
11. The account is centrally managed at first. When assets reach $5,000, the worker could select additional investment choices.
12. Workers could contribute up to an additional $2,000 and receive a partial tax credit. They could also roll over money from other retirement accounts into their Social Security PRA. Low-income workers could receive an additional $300 from the government to their account.
13. When the account reaches $10,000, the worker could switch to one of several privately managed investment choices approved by the Secretary of the Treasury.
14. If Social Security's finances improve, larger accounts could be allowed after 2038.
15. When an account reaches $2,500, the worker could switch to a private funds manager.
16. While a central administrator would collect and distribute account contributions, all investments would be in privately managed funds.
17. Some experts are concerned that PRAs could result in lower benefits for low-income workers because they may have intermittent work histories. A guaranteed minimum benefit would provide additional protections for these workers.
18. For many years, experts on all sides of the debate have criticized the current system for providing inadequate benefits to a surviving spouse. They have also expressed concern that benefit changes for retirees and their survivors would be unfair to those receiving benefits under Social Security's disability program.
19. Under current law, Social Security will automatically reduce the benefits when the trust fund runs out in 2042. From that point on, Social Security would only pay benefits equal to its cash flow. The SSA estimates that this would immediately reduce benefits by 27 percent in 2042, with larger reductions in subsequent years.
20. Under current law, Social Security uses the same benefit formula to compute both retirement and disability benefits. When a disabled worker reaches full retirement age, the worker's benefits switch from being paid by the disability program to being paid through the retirement and survivors program.
21. The DeMint plan would guarantee future retirees at least the same level of benefits as under the current system.
22. The DeMint plan would guarantee workers at least the same level of benefits as under the current system, but does not provide for a higher minimum benefit.
23. Under the DeMint plan, disability benefits would not changed. The PRA of a deceased spouse would be added to the surviving spouse's PRA account after subtracting the amount needed to pay benefits to any survivors. If there are no survivors, the PRA would go to the worker's estate.
24. The Graham plan allows workers to lock in the current level benefits if they are willing to pay higher payroll taxes. If a worker chooses that option, payroll taxes would climb to 14.4 percent from the current 12.4 percent (counting both the employer and employee shares). It would increase further if a higher rate were necessary to pay benefit levels promised under current law. If a worker chooses another option, the worker's benefits would be reduced below the level promised by the current system.
25. The Graham plan would change how benefits are calculated when the worker retires, from the current method of indexing past earnings to wage growth in the economy to indexing based on inflation and price growth. This would gradually reduce benefits. Workers who choose to pay higher payroll taxes would avoid this reduction.
26. The Graham plan sets a minimum benefit at 120 percent of the poverty level in 2011 for workers with a work history of at least 35 years.
27. Under the Graham plan, disability benefits would not change from the current level. However, when a disabled worker reaches retirement age, the retirement benefits could be reduced to reflect changes in benefit formulas during times when the worker was not on disability. Surviving spouses would receive at least 75 percent of the benefit received when both spouses were alive, subject to some restrictions. If a worker chooses to have a PRA, the balance in that account would be transferred to the spouse's account when the worker died.
28. The Smith plan includes a variety of benefit reductions that would reduce benefits for almost all retirees below the level promised by the current system.
29. The Smith plan would make many changes to Social Security's benefit formula, primarily affecting middle-income and upper-income workers. For most workers, it would eventually result in a flat monthly benefit of about $550 per month (in 2004 dollars). It would also gradually increase the retirement age for full benefits.
30. While there is no set minimum benefit as contained in some other plans, lower-income workers would receive additional credits into their PRA and any benefit reductions that would otherwise affect them would be limited by a maximum reduction.
31. Under the Smith plan, lower-income disabled workers would not be affected by reductions to the benefit formula. Disabled workers with incomes above the threshold would see a minimum benefit level. Benefits could be adjusted.
32. The Ferrara plan would guarantee future retirees at least the same level of benefits as under the current system.
33. The Ferrara plan would not provide for a higher minimum benefit.
34. The Ferrara plan does not address disabled workers in any detail. However, because the plan is based on the combined trust fund of both the retired/survivors program and the disability program, one could assume that disability benefits would be paid out of a PRA and that current disability benefits would also be guaranteed. Spouses are guaranteed current law benefits. Upon the death of one spouse, the balance in the PRA would be transferred to the surviving spouse's PRA.
35. The Orszag-Diamond plan includes a number of benefit reductions that would especially affect upper-income and middle-income retirees. It also effectively increases the retirement age for all income levels by making it impossible for workers to get their full benefits unless they choose to delay retirement beyond the current normal retirement age.
36. The Orszag-Diamond plan would gradually change the benefit formula to reduce benefits for moderate and upper-income workers. Although workers could still retire earlier, they would receive lower benefits.
37. The benefit for minimum wage workers with at least 35 years of work history would be phased in over time, with the benefits reaching at least the poverty level by 2012. This benefit would gradually increase in subsequent years.
38. Surviving spouses would be guaranteed a benefit of at least 75 percent of the amount that the couple received when both were still living. Benefits for disabled workers would not be affected by changes to retirement and survivor's benefits.
39. The benefit formula used by the current Social Security system develops an "average indexed monthly earnings" for each worker by indexing his or her highest 35 years' earnings covered by Social Security taxes according to the growth in wages that has occurred between the date they were earned and the date that the benefit calculation is being made. In the next step, the actual retirement benefit is calculated. In 2003, the formula paid benefits equal to 90 percent of the first $606 of a worker's average indexed monthly earnings, 32 percent of the amount between $606 and $3,653, and 15 percent of any indexed earnings above $3,653. The divisions between the 90 percent, 32 percent, and 15 percent levels are called bend points.
40. This threshold is indexed and changes each year.
41. Although the federal government considers the employer's matching share as a separate item, most employers add their portions of the Social Security tax to a worker's salary when calculating the true cost of an employee.
42. Under the current system, workers pay taxes on the first $87,700 of income, which is indexed and changed each year. Plans marked with "yes" would impose an additional tax increase.
43. Benefits are currently calculated using all of the income upon which the worker paid Social Security taxes. Plans marked "yes" would break this link. Many analysts on both the left and the right believe that breaking this link would be the first step toward changing Social Security into a welfare system.
44. Workers would have the option of maintaining the current level of promised benefits in exchange for a payroll tax increase.
45. Total payroll tax rates (including the tax for disability benefits) would increase from the current 12.4 percent of income (the employee and employer shares combined) to 15.36 percent by 2078.
46. Between 2005 and 2063, the Orszag-Diamond plan would gradually raise the amount of income subject to Social Security taxes by 0.5 percent points annually, in addition any increases under the current formula.
47. The Orszag-Diamond plan would impose a new tax of 3 percent on all income above the current taxable earnings limit; however, workers would not receive any credit toward Social Security benefits for income subject to this tax. The plan's authors estimate that this tax would increase to 3.5 percent by 2080.
48. All dollar amounts are in billions of 2003 dollars.
49. Present value is a measurement of the amount of money that if invested today would finance future benefit payments. For example, if Social Security will owe $1,000 in 30 years and assuming that an investment would earn an average of 3 percent every year after inflation (a growth rate equal to what government bonds pay), the present value of the $1,000 due in 30 years is $412. (Invested at a 3 percent interest rate, $412 will grow to $1,000 in 30 years.) Because the money is assumed to grow over time, a dollar needed in the future counts as less in present value terms than a dollar needed today.
50. This is another measurement of the amount of additional money needed. In this case, the "additional amount" is the total amount of additional federal revenues required to fund the transaction. Surpluses (if any) are not included since current law does not allow the government to do anything with excess cash except spend it. Under this method, if Social Security needed $1 billion in 2005 to make benefits payments and another $1 billion in 2025, the additional amount would be the total of $2 billion.
51. The current Social Security system will require additional revenues in excess of $100 billion annually for 57 years, in excess of $300 billion annually for 45 years, and in excess of $400 billion annually for 33 years.
52. The DeMint plan will require additional general revenues in excess of $100 billion annually for 35 years. It will not require additional general revenues in excess of $300 billion annually in any year.
53. The Graham plan will require additional general revenue in excess of $100 billion annually for 32 years. It will not require additional general revenues in excess of $300 billion annually in any year.
54. This scoring assumes that 100 percent of eligible workers would choose to have a personal retirement account. The plan was also scored for 67 percent and 0 percent participation, both of which require less additional general revenue dollars.
55. The Smith plan will require additional general revenues in excess of $100 billion annually for 24 years. It will not require additional general revenues in excess of $300 billion annually in any year
56. Supporters of the Ferrara plan believe that the maximum annual deficit would be $49 billion in 2005 if the various methods that it uses to finance the transition are taken into consideration. However, this section of the paper deals only with the size of the necessary general revenue transfers, not how the plans propose to finance them. The next section discusses how plans propose to find the necessary general revenues.
57. The Ferrara plan will require additional general revenues in excess of $100 billion annually for 47 years, in excess of $300 billion annually for 30 years, and in excess of $400 billion annually for 20 years.
58. The Orszag-Diamond plan will require additional general revenues in excess of $100 billion annually for 45 years. It will not require additional general revenues in excess of $300 billion annually in any year.
59. This is the most subjective measure in this paper. It compares the retirement benefits offered under the reform plan to the amount of general revenue money that is needed to finance it, while taking into consideration both changes in taxes (if any) and the ability to build a nest egg. It compares these to what the current system would be able to pay rather than what it promises.
60. Upon a worker's death, any remaining PRA balance would be transferred to the PRAs of any survivors or the worker's estate if there are no survivors.
61. Under the DeMint plan, workers may annuitize either all of their PRAs or 35 percent. However, the total income generated from a combination of the annuity and any government-paid benefit must total at least a poverty level income. If annuitizing 35 percent of the PRA does not reach this level when combined with a government-paid benefit, then enough of the PRA must be annuitized to reach that level. Any money not annuitized may be used for any purpose,
62. The DeMint plan would allow workers to improve their retirement benefits over the current system. While it has somewhat higher general revenue costs than other plans, it also guarantees a higher level of benefits and allows workers to build a nest egg for the future. The plan contains an innovative method to reduce general revenue costs by requiring workers with personal accounts to invest a certain proportion of their account in government bonds, and it contains the most progressive personal account contribution rate of any of the plans. This would allow it to closely match the current system's progressive benefit levels through its account structure alone.
63. The Graham plan requires workers to annuitize enough of the personal retirement account to provide a poverty-level income for their households, when combined with the government-paid monthly benefit. Any remaining amount may be used for any purpose.
64. The flexibility contained in the Graham plan offers workers much more control over their futures. Each worker would have the opportunity to decide the level of benefits, cost, and risk. The plan offers benefits above the current system at a relatively low general revenue cost. It also allows workers the opportunity to build a nest egg.
65. Under the Smith plan, the treatment of a deceased worker's PRA is less clear. It appears that upon a worker's death, any remaining PRA balance would be transferred to the PRAs of any survivors or the worker's estate if there are no survivors.
66. The Smith plan requires workers to annuitize enough of the personal retirement account to provide a poverty-level income for their households, when combined with the government-paid monthly benefit. However, unlike most other personal account plans, workers must either annuitize the full PRA or make regular withdrawals from amount remaining in the PRA after annuitization, although the worker may only draw enough so that the total lasts throughout retirement. The worker does not have the option of using remaining money for other purposes than retirement.
67. Overall, the Smith plan's benefit to workers is questionable. While general revenue costs are comparatively low, the eventual severe reduction in benefits will transform Social Security into a low flat-rate benefit that is substantially less than the current system's average benefit level. The plan also offers only very limited opportunities to build a nest egg. If the Smith plan were enacted, some form of almost mandatory occupational pension savings plan would be needed to provide workers--and especially lower-income workers--with a decent standard of living during retirement.
68. Under the Ferrara plan, workers must buy an annuity that pays a monthly amount equal to the worker's Social Security benefits under the current system. If the account is not large enough to buy the annuity, the federal government would make up the difference. Any money not annuitized may be used for any purpose.
69. The Ferrara plan could potentially improve workers' retirement benefits, but its substantial costs and financing mechanism may offset these benefits. While workers would be guaranteed at least the same level of retirement benefits as under the current system and would have the opportunity to build a nest egg, the higher general revenue taxes necessary to finance the plan make an overall improvement questionable.
70. The Orszag-Diamond plan does not create any form of personal retirement account.
71. Under the Orszag-Diamond plan, workers would pay higher payroll taxes for lower Social Security benefits, with no opportunity to build a nest egg. Furthermore, workers would receive no benefit for the substantial and perpetual general revenue transfers required to finance this plan.


? 1995 - 2004 The Heritage Foundation
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President Bush's Tax Plan Would Improve the Ability to Deal with Future Social Security Deficits
by David C. John
Executive Memorandum #858

February 6, 2003
President George W. Bush's proposed tax cut plan would increase economic growth and make it easier to afford the additional money required for Social Security reform. The President's dividend tax proposal alone is expected to create an average of 512,000 new jobs each year and increase GDP by over $79 billion annually, according to dynamic economic estimates prepared by The Heritage Foundation's Center for Data Analysis.
An important but often ignored side effect of higher employment and economic growth is the strengthening of the Social Security trust fund due to extra payroll tax collections. Over just the first 10 years, the higher employment caused by the dividend tax proposal would also provide over $100 billion more to the Social Security trust fund than it is currently expected to receive. Significantly more resources will flow to that trust fund after the first 10 years. While this economic growth will not solve or even significantly delay Social Security's coming fiscal crisis, the additional money will make it easier for Social Security to meet its benefit obligations over the next several years.
Given these facts, one has to wonder why the President's critics charge that the tax plan would damage Social Security. Social Security is financially stable for now, but this will not always be the case. In 2017, Social Security will begin to pay more in benefits than it receives in payroll taxes. Unless the program is reformed, it will continue to run deficits for at least the next 60 years. Between 2017 and 2077, Social Security will require $25 trillion (in inflation-adjusted 2002 dollars) more than it will receive from payroll taxes just to meet its obligations.
How the Trust Fund Operates
The Social Security trust fund is a mechanism to pay future benefits, not a source of actual money that can be used to pay those benefits. Excess payroll taxes that are not needed immediately to pay benefits are loaned to the government in return for special-issue Treasury bonds. The bonds are really nothing more than an IOU and have no other value than as a promise to impose higher general revenue taxes on future workers. It is future higher taxes that will pay Social Security benefits. The annual payroll tax surpluses, which many thought were being used to build up a reserve for baby boomers, have already been spent on other government programs or to reduce the government debt.
When an employer pays income and payroll taxes to the Treasury on behalf of his or her employees, the employer sends in one periodic check or electronic fund transfer that represents both the total income taxes and the total Social Security payroll taxes that are due. That money is all deposited into Treasury's general fund with no distinction made between income and payroll taxes. On a regular basis, the Treasury estimates how much of its aggregate tax collections are due to Social Security taxes and credits the trust fund with that amount. No money actually changes hands; this crediting is strictly an accounting transaction. These estimates are corrected after income tax returns show how much in payroll taxes was actually paid in a specific year. Then individual workers are credited with the amount that was withheld from their paychecks.
Furthermore, Social Security benefit checks are actually Treasury checks. Each month, Social Security directs the Treasury to pay benefits to a list of individual recipients and tells Treasury how much each individual is to receive. The total amount that the Treasury pays to workers is subtracted from the bookkeeping entry representing the Social Security trust fund. Again, no money actually changes hands; the funds were always in a Treasury account.
If the bookkeeping entry shows any payroll tax funds that are not needed to pay benefits, the Treasury issues the Social Security Administration a special-issue Treasury bond in that amount. The bond acts as an IOU and promises to provide general revenue funds in that amount plus interest when Social Security needs additional money to pay benefits. After the trust fund has been credited with the IOUs, Social Security's extra tax collections are treated just like any other tax and spent to pay the government's bills. That money could be used to repay federal debt owned by the public or spent to pay for any other type of federal program from aircraft carriers to education research.
False Charges That the Tax Cut Would Hurt Social Security
President Bush's plan would not reduce Social Security's ability to pay benefits, alter the Social Security trust fund, or change the program's projected insolvency date. Because the proposed tax cut does not raise or lower Social Security payroll taxes, the program would remain able to pay all benefits owed through 2017, and its trust fund account would be credited with at least the same amount in IOUs.
Social Security's finances are accounted for separately from the rest of the government, and as long as the program collects enough payroll taxes each year to meet its current obligations, changes in other taxes do not affect its financial outlook. Regardless of whether the tax cut plan passes or not, excess Social Security taxes that are not needed to pay current benefits would continue to be swept into the government's general revenues and spent on a variety of programs just as they have been for decades.
Similarly, unified federal budget deficits or surpluses have no effect on Social Security's ability to pay benefits or the amount in IOUs that will go into the Social Security trust fund. The only change would be an estimated additional $100 billion in trust fund IOUs from increased economic growth. Legally, Social Security taxes must be used only for that program--with excess revenues loaned to the government. Even though Social Security payroll taxes are mixed in with other federal revenues when both are received, the separate accounting of those payroll taxes allows the program to remain unaffected. As long as Social Security runs an annual cash flow surplus, this will remain true.
Conclusion
Both the President and Congress should act to reform Social Security in the very near future. Every day that they delay only increases the eventual cost of reform. However, paying for that reform requires the economic growth that would be created by President Bush's tax plan. Charges that the tax plan would weaken Social Security or transfer money out of Social Security to the rich are simply wrong. Similarly, worries that the tax plan would take money that is needed to pay for Social Security reform are misplaced. What Social Security needs more than anything else is a growing, healthy economy.

David C. John is Research Fellow in Social Security and Financial Institutions in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation.


? 1995 - 2004 The Heritage Foundation
All Rights Reserved.

Kerry's Clever Tax Cut
Politically, not bad. Economically, it hardly offsets his tax hikes.

Sen. John Kerry moved to the right of Walter Mondale by proposing a small cut in the corporate tax rate, which he would lower to 33 ? percent from 35 percent. In political terms, it's a clever ploy. In economic terms, it merely provides a small offset to the significant tax hikes Kerry proposes on capital formation, where he would slap small businesses, top-bracket taxpayers, dividends, and capital gains.
The Kerry proposal to rollback the Bush tax cuts would raise the after-tax cost and reduce the post-tax investment return on capital by more than 54 ? percent. Taking out the upper-bracket labor-income component -- which is still investment capital -- the Kerry tax hike would reduce investment incentives by nearly 47 percent and work-effort returns by more that 7 ? percent. A big hit.
Offsetting that, Kerry's corporate tax cut would raise after-tax returns on corporate income by almost 2 ? percent. But that's only a tiny amount compared to the overall tax-hike proposal.
Kerry would also terminate the extra-territorial tax credit for multinational companies with offshore operations. In doing so, he's both giving and taking away. More, he's pandering to the current political hysteria over so-called jobs outsourcing, a misinformation campaign that Kerry compounds with his threats to terminate a number of free-trade agreements.
As the profits of U.S. firms are taxed overseas as well as at home (when the income is transferred back to the U.S.), companies are unfairly double-taxed on their earnings. This is the big issue regarding the current corporate tax debate in Congress. Why should American companies be double-taxed on a worldwide basis when nearly all other foreign companies, including those in Europe, are only single taxed? (Europeans provide a rebate to their companies in the amount of the extra-territorial tax burden.)
U.S. multinational companies operate abroad, largely through foreign sales corporations, because that's where the market customers are. A little-known factoid shows that roughly 90 percent of all worldwide markets (in population terms) are located outside the U.S. When asked why he robbed banks, Willie Sutton responded, "That's where the money is." If you asked GE, Gillette, Intel, or Microsoft why they go offshore, they'd each say, "That's where the customers are."
Narrow-minded members of Congress who are obsessed with the phony outsourcing argument are trying to punish international companies, arguing that the "loophole" that lets corporations defer foreign-earned profits with a special tax credit is merely a reward for creating offshore jobs. This is Sen. Kerry's argument.
But the truth is, the territorial tax break is only a small part of the corporate rationale to locate part of an operation overseas. The greater justification is to be closer to foreign customers. And yes: Why should companies be double-taxed at home and abroad?
As for the outsourcing argument, that's old-fashioned fear-mongering. Recent trade data show that there's far more insourcing of service jobs from foreigners who invest directly in the U.S. than outsourcing of jobs from U.S. foreign investment. In manufacturing there is a net outsourcing, but that number hasn't changed in 20 years, a period during which the U.S. created 38 million new domestic jobs. "Outsourcing" today is a phony war against American business and open international trade.
Surprisingly, the Bush administration has not weighed in on the corporate tax-cut issue necessary to accommodate a WTO ruling that the extra-territorial tax-credit is illegal. The most sensible solution would be a reduction in the marginal tax rate on corporate income from 35 percent to somewhere around 30 percent.
House Ways and Means chair William Thomas is trying to get a 3 percent cut in the corporate rate. So Sen. John Kerry has weighed in with a smaller 1 ? percent drop. Again, he's clever. Democrats don't usually propose cutting tax rates.
But Kerry's rollback of dividends, cap-gains, and the top-bracket tax cuts instituted by President Bush would do great harm to the economic recovery and the stock market boom. Higher after-tax returns that reduce the risk of owning stock have attracted investors back to equities. After a three-year bear market, these higher post-tax returns were exactly what the doctor ordered.
The choice come November is clear. Bush is the pro-investor candidate, which should provide him with a comfortable reelection majority. (Two of every three voters were stock market investors in the 2002 and 2000 election cycles.) But a recent poll by Scott Rasmussen shows that only 36 percent of likely voters (down from 44 percent in January) believe that Bush is doing a good or excellent job with the economy.
Bush has work to do. Both the economy and the markets are recovering strong, but the president can't be bashful in making his case with clarity and vision.
-- Larry Kudlow, NRO's Economics Editor, is CEO of Kudlow & Co. and host with Jim Cramer of CNBC's Kudlow & Cramer.
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The Myth of a Jobless Recovery
by Tim Kane, Ph.D.
Executive Memorandum #917

March 25, 2004 | |
The alleged failure of the economy to create jobs is an illusion that stems from a survey of employment conducted each month by the U.S. Bureau of Labor Statistics (BLS), commonly known as the payroll survey. The payroll survey has problems measuring the modern workforce and contains a unique methodological problem: It systematically overcounts the jobs of many workers when they change employers. But worker turnover has declined significantly since the 1990s, artificially deflating payrolls.
Since the recession ended in November 2001, payroll jobs are down by over 700,000, in contrast to the additional 1.9 million Americans who say they are working, according to the latest Labor Department household survey. A close examination of the two surveys suggests that payrolls are missing something. Congress should not move to protect jobs or meddle in labor markets if, as the facts show, those markets are functioning well.
The payroll survey double-counts many workers who change jobs and is now artificially deflated because job turnover is down. Decelerating turnover in 2002-2003 explains up to 1 million jobs "lost" in the payroll survey since 2001.
The payroll survey does not count the surge in self-employment. The household survey has recorded a surge of 650,000 self-employed workers. This number may be even higher if modern workers in limited liability companies or in consulting positions with traditional firms are not identifying themselves as self-employed.
Revisions of the payroll survey have frequently been in the millions. Overestimates of 1 million payroll jobs were common in the early 1990s and also in 2002. Underestimates of 1 million jobs were common during the 1993-1996 period.
The disparity between the two BLS employment surveys is cyclical. The disparity widens during recessions and narrows during periods of rapid growth in gross domestic product (GDP). Such variation strongly suggests a statistical bias in one of the surveys.
The BLS household survey indicates record high employment. The disparity of 3 million jobs (in employment growth) between the household and payroll surveys since the recovery began is unprecedented.
Pessimists have tried to defend the payroll survey because it is bigger and less volatile than household survey data. The danger in the "bigger is better" rationale is mistaking quantity for quality. The big sample in the payroll survey is filled with double-counts and miscounts. The supposedly high monthly variability in the household survey is no worse than the large revisions in payroll data, except that revised payroll variability is historically invisible.
The Modern Workforce
One could think of the payroll survey as counting all the "brown-eyed" workers at traditional firms and "blue-eyed" workers at start-ups. It does not count "green-eyed" individuals who are self-employed, consult 20 hours a week, or simply home-school their children.
Further, workers who leave the IBM payroll for full-time consulting roles with IBM are still likely to consider themselves IBM employees. Likewise, partners at a limited liability company (LLC, a new company form) often consider themselves traditional employees, while the government classifies them as self-employed. The number of LLCs has swelled from near zero in 1993 to over 700,000. Clearly, a "hazel-eyed" workforce--self-employees who consider themselves payroll "brown-eyes"--is emerging. Yet these consultants and partners, like every farmer and sole proprietor in America, are considered jobless by the payroll survey.
Decelerating Turnover Since 2001
The payroll survey double-counts any individual who changes jobs during the pay period in which the worker is on two payrolls. "If a person leaves one job and starts another during a relatively short time span, they could appear on both employers' payrolls," said Labor Department economists in late 2003. Constant turnover means that the payroll survey systematically overestimates the level of jobs.
Because worker turnover has declined since 1999, the measure of payroll jobs has been deflated by up to 1.77 million jobs. In the two years since the recession ended, gross job flows are down by 1.2 percent, deflating the payroll survey by 1 million jobs. Thus, a net growth in payroll jobs in the real economy looks like a job loss in currently published data.
The bottom line is that either the current payroll data will be revised significantly or they will not. If they are revised, the household survey will be essentially vindicated. The more intriguing possibility is that there are structural problems within the payroll survey that have only just now surfaced in the wake of the odd recovery of the "new" economy. The loss of payroll jobs may be permanent as the workforce shifts to new forms.
Conclusion
Policymakers and analysts should treat payroll data with caution when making comparisons to employment levels in 2001 and earlier years. A better measure of employment is the household survey, and analysts can now point with confidence to the employment of an additional 1.9 million workers since the recession ended.
Tim Kane, Ph.D., is Research Fellow in Macroeconomics in the Center for Data Analysis at The Heritage Foundation.

? 1995 - 2004 The Heritage Foundation
All Rights Reserved.


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Will the Real Unemployment Rate Please Stand Up?
by Timothy Kane
WebMemo #456

March 24, 2004
Big government types assert that the economy cannot recover without the government's help. The anemic, sluggish labor market is their main piece of evidence when arguing for more benefits for the poor, more taxes on the rich, higher minimum wages, and protection from international trade with impoverished Third World countries. The unwelcome sunshine on their gloomy parade for big government is the low rate of unemployment, currently at 5.6 percent.
Even pessimists know that 5.6 percent unemployment is close to what economists consider the "natural" rate or the non-accelerating inflation rate of unemployment. As a metric, the rate of unemployment is comparable to body temperature in that a sudden spike upwards is a powerful signal of ill health. But after a fever breaks, coming back to the normal level is healthy, and going much lower has risks of its own.
What is the Unemployment Rate?
Instead of arguing that the unemployment rate could or should be lower, critics are questioning the integrity of the way the rate is calculated. The basic idea is that the economy is so bad that workers are not even in the labor force, and so the unemployment rate today is not comparable to the rate five or ten years ago. For example, on March 19th, a Washington Post editorial claims that the unemployment rate is "above 7 percent" if "you add in discouraged workers."
The Post has been misinformed. The authoritative data on unemployment come from the Bureau of Labor Statistics (BLS), specifically table A-12 of the household survey, which calculates several different unemployment rates. Each is based on a nuanced definition of who is actually unemployed. http://www.bls.gov/webapps/legacy/cpsatab12.htm. Unemployment peaked in June 2003, and that peak is lower than the level of unemployment in the early 1990s for all measures of unemployment.
The rate of unemployment that includes discouraged workers is known as "U-4." It is currently 5.9 percent, which is 0.3 percent higher than the official rate, not the 1.4 percent gap imagined by the Post. Actually, the present gap between U-4 and the official unemployment rate is quite close to the historical average of 0.23 percent.
[Click CHART to enlarge]
As a refresher, the rate of unemployment in February 2004 is calculated by dividing the 8.17 million unemployed Americans by the 146.47 million people in the labor force. Paul Krugman's March 12 column in the New York Times is typical of attempts to explain away the low rate of 5.6 percent, saying it is "entirely the result of people dropping out of the labor force."
A fine argument, if only it were true. Chart 2 shows what is really happening. The household survey reports a surge in the size of the labor force (2.03m) and total employment (1.90m) since the end of the recession in November 2001. (http://www.bls.gov/cps/cpspopsm.pdf).
[Click CHART to enlarge]
Discouraged Workers?
So, what is the difference between discouraged workers and other marginally attached workers? As technically defined by the BLS, discouraged workers think that no work is available, and so they quit looking. In sharp contrast, other "marginally attached" workers think work is available but are not able to actively seek work for reasons such as child-care and transportation problems. They are specifically not discouraged, and it is inaccurate to describe them as such. It is even more inaccurate to describe every home-schooling parent and sole proprietor as jobless, but that is another story (http://www.heritage.org/Research/Labor/CDA04-03.cfm).
Those are the facts. But this is a political season, and often facts can't find their way into the headlines. Even so, anyone who is genuinely concerned about the U.S. economy should know that its temperature is fine. There are fewer discouraged workers as a percentage of the labor force today than in 2003, but also in comparison to 1994, 1995, and even 1996. Despite the fondest hopes of pessimists, today's low unemployment rate is the real deal.
? 1995 - 2004 The Heritage Foundation
All Rights Reserved.


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Mediscam?
The drug bill cost more than the Bushies let on.
In previous columns, I have warned that George W. Bush is in danger of appearing Nixonian -- that is, using Richard Nixon's political methods, such as a willingness to subordinate everything to a re-election effort, including abrogation of one's own principles; punishing staffers with genuine policy disagreements for being disloyal; and keeping secret information that might undermine decisions one has already made.
The clearest evidence yet of Bush as Nixon has arisen over the question of what the White House knew about the cost of the recently passed Medicare drug bill, when it knew it, and whether it actively suppressed information that might have caused the measure to fail in Congress. It is becoming harder and harder to believe that the administration was not knowingly engaged in deception in this matter. Increasingly, it appears that it knew perfectly well that the legislation would cost far more than $400 billion over 10 years -- the most Congress was allowed to spend under its rules -- and that it took extraordinary measures to suppress this fact.
The center of this situation is an obscure bureaucrat named Richard Foster, chief actuary for Medicare. It is his job to estimate spending for that program over long periods. Annually, he produces a report for Medicare's board of trustees, based on many complex mathematical calculations, that lays out the program's financial condition in excruciating detail. Foster's latest report was delivered Tuesday, March 23. It showed serious financial deterioration, largely due to the addition of a large unfunded drug benefit.
According to the New York Times, Wall Street Journal, and Knight Ridder news service, Foster knew last summer that the drug bill being debated in Congress would cost somewhere between $500 billion and $600 billion. In its latest budget, the administration conceded that the figure is $534 billion.
The problem is that everyone knew that a bill with a price tag that large would never get through Congress. The version that did pass only made it through with two votes to spare in the House of Representatives (and only after the vote was held open for an unprecedented 3 hours, while arms were twisted to get the necessary votes). Most of the pressure was brought to bear on conservative Republicans reluctant to vote for so much new spending when the budget was already in deficit.
Reportedly, the last couple of votes were secured after legislators were warned that an even bigger Democratic bill would be enacted unless they agreed to the White House plan. This was utterly dishonest. In the event that the administration bill went down to defeat, the House leadership would simply have pulled it off the floor while something new was cooked up. There was zero chance that something like the $1 trillion Democratic alternative would ever have become law.
Another argument being made by the drug bill's supporters is that only the Congressional Budget Office's estimate of $395 billion was binding. The administration's estimate would not have been official for legislative purposes. While this is technically true, it ignores the closeness of the vote and the fact that misgivings about the drug bill's cost were the final sticking point. There is no serious political observer who does not think that disclosure of the administration's $534 billion estimate would have killed the bill, at least temporarily.
This is why the apparent effort to squelch Foster is so scandalous. Reportedly, his boss, Medicare administrator Tom Scully, threatened Foster with dismissal if he communicated any information about his estimates to anyone on Capitol Hill without Scully's authorization. Needless to say, such authorization was not forthcoming, because Scully knew perfectly well that it doomed the legislation -- a high-priority White House initiative.
The administration has tried to portray this whole thing as a simple management issue. Generally speaking, career bureaucrats are not allowed to communicate with Congress officially unless through channels. However, the actuaries for Social Security and Medicare have long had a measure of independence, allowing them to give technical advice directly. Consequently, the effort to withhold estimates of the drug bill appear unusual and politically motivated to an extraordinary degree.
It looks as though Scully will be the fall guy for this scandal -- which is convenient, since he has already left government. But the larger question of White House honesty still needs to be answered.

-- Bruce Bartlett is senior fellow for the National Center for Policy Analysis. Write to him here.

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Medicare's Deepening Financial Crisis: The High Price of Fiscal Irresponsibility (Draft)
by Robert E. Moffit, Ph.D., and Brian Riedl
Backgrounder #1740

March 23, 2004

Medicare, the huge government insurance program that covers 41 million seniors and disabled citizens, is facing a major financial crisis. None of this is surprising.
Rising Costs
Title I of the Medicare Prescription Drug Improvement and Modernization Act of 2003 creates a new and complex universal prescription drug entitlement. According to the latest Medicare trustees report, the Medicare hospital insurance program will be exhausted in 2019, seven years earlier than the past year's estimate.[1] But that is just the tip of the iceberg. The hospital insurance trust fund does not include the new drug entitlement, and that alone will add $8.1 trillion to the program's long-term unfunded liabilities over the next 75 years.[2]
Medicare's massive costs will result in huge tax increases. According to Medicare Trustee Thomas R. Saving, a professor of economics at Texas A&M University and senior fellow at the National Center for Policy Analysis, the Medicare program is now projected to consume:
24 percent of all federal income taxes by 2019 and
51 percent of all federal income taxes by 2042.[3]
The true cost of the drug entitlement expansion is unknown, and the trustees could be understating the real cost. When the new Medicare law was enacted in 2003, the Congressional Budget Office (CBO) estimated the 10-year cost at $395 billion. Less than three months later, the White House Office of Management and Budget (OMB) revealed that it estimated the 10-year cost at $534 billion.[4]
More recently, Richard S. Foster, Medicare's chief actuary, said, "All our estimates showed that the cost of the drug benefit, through 2013, would be in the range of $500 billion to $600 billion."[5] This is just for the next 10 years, before the baby-boom generation hits the program. All of the various government actuaries have concluded that taxpayers will likely pay far more than the initial official estimates for the first 10 years and trillions of dollars after that.
Ironically, the entire financial situation could be far worse. During the debate on the new drug entitlement, Democrats offered proposals that would have cost nearly $1 trillion in the first 10 years,[6] far in excess of anything proposed by the Administration or the congressional leadership. Many critics of the new drug program actually want a more expensive program.
Bad Drug Policy
When the new drug entitlement takes effect in 2006, seniors will pay an estimated $420 in additional drug-related premiums in the first year, plus a $250 deductible. The government would then pay 75 percent of drug costs up to $2,250. Above that amount, seniors would pay $3,600 out of pocket--the "doughnut hole"--before becoming eligible for catastrophic coverage, with the government paying 95 percent of catastrophic costs and seniors paying 5 percent. Unlike the hospitalization payments, which are drawn from dedicated taxes deposited in a trust fund, the government will pay for the drug benefit from general revenues.
In the meantime, the new Medicare law creates a prescription discount drug card, effective this year, that includes a $600 subsidy for low-income seniors. Unlike the subsidies provided for seniors under the drug entitlement, the drug card subsidies do not require an asset test for eligibility. The discount card is projected to save between 10 percent and 25 percent. For many seniors, especially poor seniors without coverage, this is an attractive program; it is also market-friendly and builds on existing private-sector entities. Remarkably, Congress has decided to kill this promising program after just two years of operation.
Thus, the drug discount card is temporary and expires in 2006, but the new drug entitlement is permanent and would take effect in 2006, accelerating the displacement of the existing drug coverage for millions of retirees, including the coverage that many seniors have today through former employers. Thus, Congress has enacted a universal government drug entitlement, setting in motion dynamics that will crowd out other alternatives.
A Better Medicare Drug Policy
Congress made a huge mistake in enacting the universal drug entitlement and should deal with the emerging financial problems of Medicare, including the prescription drug problem, as quickly as possible. Specifically, Congress should:
Delay the implementation of the universal drug entitlement scheduled for 2006. Even without a prescription drug entitlement, Medicare is facing formidable financial challenges. A range of public and private-sector health policy analysts have repeatedly warned Congress of the gravity of these challenges and have recommended serious structural changes to Medicare, such as a premium support financing system, to enable the program to deliver high-quality health care to future retirees.
In the meantime, Congress has not yet adopted a strong mechanism to cope with future entitlement costs and the unfunded liabilities that face current and future generations of taxpayers. This needs to be done before any new entitlement begins in 2006. In the face of these unmet challenges, there is no good reason for Congress to expand the Medicare entitlement, displace existing drug coverage, and accelerate the loss of drug coverage offered to retirees through former employers.
Make the drug discount card program a permanent feature of Medicare. The Centers for Medicare and Medicaid Services staff is already processing applications from over 100 companies that want to offer the drug discount cards on a regional or national basis. The infrastructure for a potentially successful program is already being established. There is no good reason to shut down the entire operation and deprive seniors of a personal choice. Indeed, the drug discount card program, combined with catastrophic coverage and even richer subsidies to low-income seniors, could be the foundation of a superior drug option for Medicare beneficiaries.
Federal subsidies to low-income seniors, or those without drug coverage, could be delivered through debit cards issued by private health plans. Any qualified health plan that provides for catastrophic coverage and meets current federal or state insurance regulations should be able to participate. Income-related subsidies could be channeled through qualified health plans. This would give Medicare beneficiaries a strong incentive to sign up for drug coverage and minimize adverse selection.
Like the entities offering the drug discount cards, the plans could be national or regional and could be required to disclose information that would allow for consumer comparisons. Consumer comparisons are routine under the Federal Employees Health Benefits Program (FEHBP), the popular and successful program used by federal employees and retirees.
Integrate the drug discount card program into the new Medicare Advantage program. Medicare beneficiaries should be allowed to continue to use the drug discount card, and the subsidies for low-income seniors should be retained or even increased. In 2006, the Medicare Advantage health plans, including new regionally based preferred provider organizations, will be available to seniors. These health plans should have the opportunity to integrate the drug discount card and low-income drug assistance programs into their health plan offerings. Unspent funds for those who are subsidized through the discount card could be rolled over tax-free from year to year, much like a health savings account.
CONCLUSION
Taxpayers face a serious financial problem in the Medicare program. As Professor Tom Saving, a Medicare public trustee, has reported, the program is projected to consume over half of all federal income taxes by 2042.[7]
Taxpayers can expect the real costs of the drug entitlement to be much greater than the initial published estimates. Worse, some Members of Congress are claiming that the current drug entitlement subsidy is not enough and want to fill the entitlement's unpopular "doughnut hole" and double the initial expenditures on the new entitlement. Such prescriptions would not only worsen Medicare's already difficult financial problems, but also pave the way for government restrictions on prescription drugs for seniors. To control costs of the drug entitlement program, the government would somehow have to limit the supply of drugs, probably through tighter drug formularies or some form of government price fixing or purchasing mechanism. Yet, with demand for prescription drugs rising rapidly, the government cannot and should not provide more by paying less.
There is a better alternative. Members of Congress should get a handle on the exploding costs of the Medicare program before implementing a universal entitlement expansion. To that end, they should at least delay implementation of the drug entitlement while making the prescription drug discount a permanent feature of Medicare, including the new Medicare Advantage system that will take effect in 2006. Such a policy could establish the foundation for a more rational and responsible Medicare drug program: one that accommodates, rather than displaces, a wide variety of private-sector drug options.
Of course, Congress can also choose to do nothing.
But nothing will be very expensive.

Robert E. Moffit, Ph.D., is Director of the Center for Health Policy Studies, and Brian M. Riedl is Grover M. Hermann Fellow in Federal Budgetary Affairs in the Thomas A. Roe Institute for Economic Policy Studies, at The Heritage Foundation.

[1]Centers for Medicare and Medicaid Services, 2004 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplemental Insurance Trust Funds, March 23, 2004, p. 2, at www.cms.hhs.gov/publications/trusteesreport.
[2]Ibid., p. 109. The unfunded obligation over the 2003-2078 period is $8.1 trillion. The unfunded obligation over an infinite time horizon is $16.6 trillion. This year, the Medicare trustees have introduced an additional way to calculate the program's future costs and liabilities. This method, known as "infinite horizon," includes all current and future participants. Under this category, the unfunded obligation of the drug entitlement amounts to $16.6 trillion.
[3]Thomas R. Saving, "Examining the 2004 Social Security and Medicare Trustees Reports," congressional briefing on behalf of the National Center for Policy Analysis, Washington, D.C., 2004.
[4]The different cost estimates are the results of significant differences between CBO and OMB assumptions.
[5]Robert Pear, "Democrats Demand Inquiry into Charge by Medicare Officer," The New York Times, March 14, 2004.
[6]Sheryl Gay Stolberg and Robert Pear, "Mysterious Fax Adds to Intrigue over the Medicare Bill's Cost," The New York Times, March 18, 2004.
[7]Saving, "Examining the 2004 Social Security and Medicare Trustees Reports."

? 1995 - 2004 The Heritage Foundation
All Rights Reserved.

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>> CLINTON MP3 LINK
http://www.newsmax.com/archives/ic/2004/3/25/00841.shtml

White House, Giuliani React to Sudan's OBL Offer
The Bush White House and former New York City Mayor Rudy Giuliani reacted on Wednesday to news that President Clinton turned down an offer to arrest Osama bin Laden five years before the Sept. 11 attacks.
During an interview with White House Chief of Staff Andy Card, radio host Sean Hannity played NewsMax.com's recording of Clinton explaining that after Sudan released bin Laden in 1996, "I did not bring him here because we had no basis on which to hold him, though we knew he wanted to commit crimes against America."
Hannity asked Card, "Doesn't that statement clearly indicate that Osama bin Laden was offered to the United States?"
The top Bush aide sounded stunned by the Clinton audio.
"You ask a very important rhetorical question and I can't answer it," said Card. "I have no knowledge [of the Sudanese offer]. When I say I have no knowledge, I don't even have knowledge that I can't tell you about."
When pressed on whether Clinton's comments indicated that the Sudanese offer was indeed real, Card told Hannity, "It would certainly be a credible reason to have that expectation."
Later during the same broadcast, Hannity shared the Clinton audio with former New York City Mayor Rudy Giuliani, who said it confirmed reports of the Sudanese offer.
"From President Clinton's answer it sounds like he was offered [bin Laden]," he told Hannity.
"It sounds like the president and the administration came to the conclusion that there was no legal basis - if we had him - to hold him, which would make him just a free person here. That seems like the former president is probably correct about that."
Giuliani continued:
"But I don't know how you'd be having those discussions if [bin Laden] wasn't offered. ... I don't know why he'd be making those decisions if there wasn't some kind of viable offer being made."
On Tuesday the 9/11 Commission said it could find no "reliable evidence" indicating that Sudan had indeed offered bin Laden to the Clinton administration.

To listen to Bill Clinton explain how he let Osama bin Laden get away, Click here.

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9/11 Commission: Clinton Refused to Let CIA Kill Bin Laden
Announcing some of its preliminary findings on Wednesday, the 9/11 Commission has confirmed that President Clinton ordered the CIA to take Osama bin Laden alive or not at all - a directive that made the task of neutralizing the terrorist kingpin infinitely more difficult.
In a statement read at the beginning of Wednesday's session, 9/11 staffer Michael Hurley revealed:
"CIA senior managers, operators and lawyers uniformly said that they read the relevant authorities signed by President Clinton as instructing them to try to capture bin Laden.
"They believed that the only acceptable context for killing bin Laden was a credible capture operation. 'We always talked about how much easier it would have been to try to kill him,'" a former chief of the bin Laden station told the Commission.
"Working level CIA officers were frustrated by what they saw as the policy restraints of having to instruct their assets to mount a capture operation," the Commission statement said.
Commission staffer Hurley detailed one attempt to recruit indigenous Afghan forces in a bin Laden capture operation, explaining, "When Northern Alliance leader Massoud was briefed on the carefully worded instructions for him, the briefer recalled that Massoud laughed and said, 'You Americans are crazy. You guys never change.'"
The Commission found that at least two senior CIA officers would have objected to killing bin Laden even if Clinton had authorized the hit. "One of them, a former counterrorism center chief, said that he would have refused an order to directly kill bin Laden," the Commission statement said.
Last week NBC News quoted former CIA official Gary Schroen as saying that White House orders to spare bin Laden's life cut the chances of getting him in half, from 50 to 25 percent.
Schroen's revelation - now confirmed by the 9/11 Commission - was ignored by the mainstream press beyond its initial coverage by NBC.
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China Puts Gun to Head to of U.S. Tech Companies
Dave Eberhart, NewsMax.com
Saturday, Mar. 27, 2004
As the Wi-Fi boom takes hold around the globe, China is putting a gun to the head of U.S. chip makers -
Either turn over your patented technology - and accept our standards - or we won't allow U.S. companies to enter Chinese markets.
Wi-Fi refers to "wireless fidelity" - the ability to transmit internet and other broadband connections though wireless transmitters to computers and other wireless devices. With Wi-Fi, plugging your computer into a telephone line will be a thing of the past. And already, there's talk of Wi-Fi telephones, radio and more.
The Wi-Fi craze is taking root here in the U.S. - with "hot spots" or "Wi-Fi nodes" sprouting up in airport lounges, hotels, public parks, and even Starbucks.
Now, Chinese IT companies are poised in the wings, salivating to create computer "hotspots" at trendy Chinese airports, restaurants and the ubiquitous Starbucks -- anxious to serve a huge computer savvy populace breathless for wireless Internet connectivity (WLAN).
The bogeyman in this frenetic scene: China's Wired Authentication and Privacy Infrastructure (WAPI) security specification.
The rub: China's newly developed WAPI security spec isn't compatible with the U.S. and World 802.11 standard. A 802.11 network refers to a family of specifications developed by the IEEE for wireless LAN technology. The numeric specifies an over-the-air interface between a wireless client and a base station or between two wireless clients. The IEEE accepted the specification in 1997.
IEEE is the Institute of Electrical and Electronics Engineers, an organization composed of engineers, scientists, and students -- best known for developing standards for the computer and electronics industry. In particular, the IEEE 802 standards for local-area networks are widely followed.
Worst of all: China doesn't seem to care.
In fact, China has pulled out a .357 magnum and pointed it at the head of U.S. tech companies: China is now demanding that non-Chinese vendors must partner with one of 24 Chinese-sanctioned vendors to make any Wi-Fi products used in the People's Republic - incorporating, of course the nettlesome WAPI.
At stake: the slamming of the door on the huge Chinese IT market.
China's surprise game of hardball has much of the IT world and its cadre of pundits in a dither:
Some think that forcing the foreign companies to work with the Chinese vendors is just a WTO-dissing ruse to pump up the country's flagging economy.
Others suggest that the forced partnerships put foreign Intellectual Property rights in jeopardy. China, after all, has a bad rep in this department. While working with the foreigners to muscle in the new Chinese WAPI, the Chinese vendors will get the inside scoop on a bunch of trade secrets held by their guests' gear and spirit it away -- reprising the nation's stunt with cell phone technology in the last decade.
Conspiracy addicts suspicion that WAPI just might include a "back door" that would allow the Chinese government access to encrypted data.
Some opine that the Chinese checkers move is just the salient in a long-term move to make the Chinese WAPI the world standard, dissing long-standing entities such as IEEE and the Wi-Fi Alliance.
The Wi-Fi Alliance is an organization made up of leading wireless equipment and software providers with the missions of certifying all 802.11-based products for interoperability and promoting the term Wi-Fi as the global brand name across all markets for any 802.11-based wireless LAN products.
And the biggest fear: Chinese companies will use Western Wi-Fi technology to build the expertise needed to grab a big share of the growing market for chips in China. So far, the budding Chinese IT industry is benignly churning out low-end semiconductors, including commodity memory chips, for relatively simple goods. No one, save for the Chinese, is anxious to see that happy situation change.
Not so to all-of-the-above, argue the Chinese, who suggest that they are only interested in security. The present World standards are at best second-rate, they say, and need to be abridged (particularly to quell the national paranoia in all things relating to security).
Between a Rock and a Hard Place
In any event, all this brouhaha has put the leading foreign manufacturers between a rock and a hard place.
Everyone would like to humor the hugely profitable customer. The customer, after all, is always right. However, the rock at one end is that tech companies don't want to give away trade secrets that will eventually grow low-cost rivals. And the hard place is that if they spurn China's demands, they risk being frozen out of a fast-growing market.
Dilemma or no, Intel Corp. has tossed down the gauntlet, announcing that it won't ship any Wi-Fi chips to China after May of this year. It seems that Intel's Centrino integrates a Wi-Fi transmitter with a microprocessor. That unhappy fact -- for reasons at best vague to the technically-disadvantaged -- makes it a cinch that the U.S. giant would have to cough-up key know-how to finagle the Chinese standard WAPI thingamajig to work in its own gear.
No one to dis a big client, Intel has eschewed any reference to the shopping list of colorful charges above, revealing only that the use of the WAPI gadget would undermine the quality standards of its products and that the technical challenges of converting to WAPI were too great to meet the deadline of June 1.
Chip maker Broadcom has also come out as against the WAPI mandate. They will also stop selling Wi-Fi chips to China - also starting in May.
But there is hardly a united front. Competitors Atheros and Texas Instruments are going to go ahead full bore with full support for WAPI.
Enter the Mysterious `ARM core'
Jason Tsai, senior manager for the Connectivity Products Division at Taiwan-based Silicon Integrated Systems, has signaled his company's malleability to the mandate:
"In our design, we can move in two directions -- modify the hardware architecture as soon as possible" or "try to implement an ARM core into the chip to have the flexibility to modify the firmware to fit the WAPI spec."
"Firmware" or not, some out there in IT-land are still hoping for some kind of compromise to break the logjam. After all, some argue, chipmakers have already agreed upon improved international standards to address many of the Wi-Fi security issues China raises.
Perhaps China, a relatively new member of the World Trade Organization, will buckle under the pressure coming from those who maintain that Beijing's policy violates WTO rules. Some of the fine print in those rules, for instance, says that governments are not allowed to treat foreign companies differently from domestic ones.
Ann Rollins, director of technology and trade policy at industry lobby group ITI sees it this way:
"China is a new member of the WTO. And the people that developed the standard don't quite understand that there are principles and obligations to uphold."

FBI denies link between terrorists, LNG tankers
By Shelley Murphy and Stephen Kurkjian, Globe Staff, 3/26/2004
FBI officials vehemently denied yesterday recent assertions by former White House terrorism czar Richard A. Clarke that the FBI learned in December 1999 that terrorists had been slipping into Boston on liquefied natural gas tankers from Algeria, yet failed to notify local authorities.
``We did thoroughly investigate that LNG tanker situation and came to the conclusion they were not being used to transport terrorists into our country,'' said Kenneth Kaiser, the special agentin-charge of the FBI's Boston office. ``We didn't brief the mayor that there was an Al Qaeda cell here, because there wasn't one.''
According to Kaiser, the FBI was investigating the thwarted 1999 ``millennium'' plot to blow up Los Angeles International Airport when it learned that several people being questioned in Boston had entered the country by stowing away on LNG tankers from Algeria.
The Joint Terrorism Task Force, which includes members from the Boston police and the Massachusetts State Police, conducted an intensive investigation and concluded that none of the stowaways were terrorists, Kaiser said.
``There were none that had any links to terrorism that we could find and none that committed any acts of terrorism,'' Kaiser said. Ultimately, the cases in Boston were turned over to the US Immigration andNaturalization Service to determine whether the men should be deported, he said. Kaiser said he did not know if anyone had been deported.
While one of the men who was later convicted in the millennium plot, Abdelghani Meskini, had arrived in Boston as a stowaway on an Algerian tanker, Kaiser said there was no evidence that Meskini, who is cooperating with authorities and denies being a terrorist, had any terrorist links when he arrived in Boston in January 1995. He was living in Brooklyn, N.Y., when he was arrested in December 1999 in connection with the millennium plot.
Clarke, who left his post with the White House last March, says in his new book, ``Against All Enemies,'' that the FBI learned in December 1999 that Al Qaeda suspects had entered the United States onLNGtankers that dock at the DistriGas port in Everett. Yesterday, he said that information should have been shared with State Police officials and the governor.
``The governor and his authorities should have been informed, and frankly I don't know why the FBI didn't make that happen,'' Clarke said yesterday in an interview on WRKO radio. ``The FBI has channels for notifying state and local law enforcement officials when it finds out things in their jurisdictions, and the FBI definitely should have told the State Police.''
Clarke's comments were his first public remarks on the issue of LNG safety in Boston Harbor. Local officials and the company that runs the LNG facility, Distrigas of Massachusetts, said they were unaware of possible terrorist infiltration of LNG tankers until Clarke's book was published.
But Kaiser said that Clarke's assertions were based on ``incomplete information,'' because he had received a briefing on the FBI's investigation into the LNG tankers when it was ongoing and he apparently didn't know that the FBI had concluded that terrorists weren't jumping ship in Boston.
Tom Powers, an assistant special-agent-in-charge who heads the FBI's counterterrorism efforts in Boston, said he personally gave Clarke a briefing on the case on June 23, 2000, when Clarke was traveling to FBI offices around the country for updates on their efforts to fight terrorism.
``I don't believe those tankers were ever used up to 9/11 as a deliberate attempt to seed terrorism in the United States,'' Powers said.
US Representative Edward J. Markey, whose district includes Everett, said he would continue to push for documentation that backs up the FBI's statements, noting that President Bush's aides are working hard to shoot down claims made by Clarke. He said he has been asking federal officials for information on terrorist threats to the LNG facility since shortly after Sept. 11, 2001. Mayor Thomas M. Menino said he doesn't believe the issue of possible terrorists arriving as stowaways on tankers was ever mentioned to Boston police officials.
Kaiser said Boston police officials were briefed on the LNG tanker investigation at the time, and said it's customary to brief the Boston police commissioner, rather than go directly to the mayor. Everett Police Chief Stephen A. Mazzie said he believes that ``dozens'' of Algerians arrived in Boston by stowing away on an LNG tanker, the Mostefa Ben Boulaid, which made monthly trips from Arzew, an Algerian port city in North Africa.
Mazzie said, however, that he investigated the backgrounds of many of the Algerians after they were charged with minor crimes, but that none were involved in violent crimes, guns, or bomb-making.
But because they were in the country illegally, Mazzie said he contacted the INS. ``What I got back was that there was nothing [the INS] could do unless it involved a felony or crime of violence,'' Mazzie said.
Mazzie and Chelsea Police Chief Frank Garvin said that the FBI and other federal agencies were so concerned about security at the Everett facility that they boarded vessels to check for illegal contraband and review the crew's identification papers.
``We thought we had any problems under control,'' Garvin said
Tuesday, ``which is why everyone was so surprised to read that there might have been a terrorist threat among the stowaways on the boat.''
A Distrigas statement said that the company stopped accepting Algerian vessels months before the attacks of 9/11.
Rick Klein of the Globe staff contributed to this report.

? Copyright 2004 Globe Newspaper Company.
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FBI chief talks of election-year terrorism risks
By Curt Anderson, Associated Press, 3/26/2004
WASHINGTON -- Terrorists could attempt to influence the outcome of this year's US presidential election by launching attacks in America and overseas, FBI Director Robert Mueller said yesterday.
In an interview, Mueller also said Islamic extremists have changed tactics and are focusing on recruiting local sympathizers who are less likely to arouse suspicion than outsiders sent into a country to conduct terrorist operations.
The March 11 train bombings in Madrid, which were a factor in the ouster of a pro-US Spanish government, could embolden Al Qaeda or other extremists to attack the United States during this summer's presidential nominating conventions in New York and Boston, Mueller said.
"In the wake of what happened in Madrid, we have to be concerned about the possibility of terrorists attempting to influence elections in the United States by committing a terrorist act," Mueller said.
Those conventions will book-end the Summer Olympics in Athens, another venue that could draw terrorist attacks. The United States has been concerned that security efforts in Athens may fall short of what is necessary to protect athletes and spectators.
"We understand that between now and the election, there is a window of time in which terrorists might try to influence events, whether it's here or overseas," Mueller said. The FBI and other US agencies are assisting the Greeks to identify and shore up potential weaknesses.
Regarding the new Al Qaeda recruiting tactics, Mueller said that the suicide bombers who took part in last May's attacks in Casablanca, Morocco, were local extremists, and he indicated that similar efforts are probably going on in the United States.
Mueller applauded the cooperation of Saudi Arabia and Pakistan in US antiterrorism efforts. Since the deadly May 12 bombings in Riyadh, Saudi Arabia has moved aggressively to root out Al Qaeda cells and discovered huge caches of explosives and weapons.
"Saudi Arabia has become a very inhospitable place for Al Qaeda," Mueller said. "That was not always the case."
Separately, the FBI yesterday said it had given Texas oil refiners a new warning about possible terror attacks coinciding with US elections in November, but reaction from the industry and world oil markets was muted. The advisory was based on "very raw intelligence" from overseas sources, said Bob Doguim, spokesman for the Houston FBI office.

? Copyright 2004 Globe Newspaper Company.
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Tax cut is part of Kerry plan
By Jim VandeHei, Washington Post, 3/26/2004
WASHINGTON -- John F. Kerry today will propose a 5 percent cut in the corporate tax rate as part of a new economic plan designed to create 10 million jobs by 2009 and discourage companies from sheltering taxable income overseas, his economic advisers said yesterday.
In essence, Kerry will offer a trade: If elected president, he would cut taxes on US corporations if they accept the elimination of tax benefits for those firms that move overseas.
The Massachusetts senator, fresh from a week's vacation, plans to use his first domestic policy address of the general election campaign to call for this carrot-and-stick approach to prod US companies to do more business and create more jobs in America. The speech is billed as the first of three presenting Kerry's detailed balanced budget plan, which will include several new tax cuts.
In doing so, Kerry is seeking to position himself as a moderate, probusiness Democrat similar to Bill Clinton in the 1990s and beat back charges he is a liberal tax-and-spend politician.
The Kerry offensive illustrates the centrality of economic issues in the 2004 election. As Kerry's economic team was rolling out the new plan, President Bush was airing a new TV ad, accusing Kerry of supporting tax hikes on Social Security recipients and gas and touting his own "optimistic" economic vision in a different ad and in New Hampshire.
In today's speech at Michigan's Wayne State University, Kerry will reiterate his call for the elimination of all tax breaks that encourage US companies to locate operations and jobs overseas and close all international tax loopholes. For the first time, he will target a popular tax incentive, known as "deferral," offered to most US companies that do business in lower-taxed foreign countries.
To soften the blow to corporations, Kerry will propose a one-time, one-year offer to tax at 10 percent any profits a company brings back to the United States and invests here; an expanded tax credit to companies that create domestic jobs and a reduction in the corporate tax rate to 33.25 percent from 35 percent.
"The most salient feature, or at least symbolic feature, is the corporate tax rate [cut]," said Roger Altman, a top economic adviser to Kerry. "When is the last time you saw a Democrat propose a corporate tax cut?"
Gene Sperling, another Kerry economic adviser, said the tax cuts for business will be fully funded by the international tax changes.
But Bruce Josten of the US Chamber of Commerce said the Kerry plan seems to ignore the complexity of the global economy. "There is a broader point he completely misses: there are companies that open up overseas" for reasons other than tax avoidance, he said.
By coupling new tax breaks with what amount to a new tax hike if loopholes are closed, Kerry is following Clinton's economic -- and political -- blueprint. In 1993, Clinton and congressional Democrats offered a mix of tax cuts and increases as the centerpiece of an economic plan that they say helped set the stage for the booming 1990s. Altman and Sperling worked for Clinton.

? Copyright 2004 Globe Newspaper Company.
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US details war plan's success and failings
By Bryan Bender, Globe Staff, 3/26/2004
WASHINGTON -- The American blitz into Baghdad was a stunning military success, but the war plan failed to adequately address the need to secure "sensitive sites" such as suspected weapons facilities, government archives, and possible terrorist hide-outs, according to a draft of the Pentagon's self-assessment of the military's performance in Iraq.
The draft report said that not enough properly trained units were available in the early weeks of the operation to take over sites where weapons of mass destruction were suspected, even though much of the war plan was predicated on the idea that Iraq might retaliate with unconventional weapons.
Overall, the unclassified version of the "lessons learned" report concluded that the successful US-led invasion proved the effectiveness of smaller, high-tech units deployed quickly over large expanses -- the prime thrust of Defense Secretary Donald H. Rumsfeld's efforts to "transform" the military.
No longer are large formations critical to victory when small, flexible units linked with precision weaponry and high-tech communications can overwhelm a conventional military enemy by attacking its political, military, economic, and social centers, according to the draft report, which was obtained by the Globe.
"The traditional view of military forces wearing similar uniforms, arrayed on a linear battlefield, fighting mass formations, began to give way [in Iraq] to a different style of war-fighting," the report said. "Smaller formations with fluid and flexible command-and-control relationships, using lethal and nonlethal capabilities, fought to directly influence political, military, social, economic, information, and infrastructure objectives."
The report, dated March 1, is the first comprehensive Pentagon assessment of the invasion. Its existence was first reported by Inside the Pentagon, a newsletter covering the US military and the defense industry. A final version is expected to be released to the public in the coming weeks. The draft warned that the campaign that toppled Saddam Hussein in three weeks should not be used as a model for all future wars: Iraq, which had been a heavy focus of US military and intelligence officers at least since the 1991 Persian Gulf War, provided unique advantages for the United States from the outset that are unlikely to recur.
The 128-page report, which covers the period from March 21 to May 1, 2003, when President Bush declared an end to "major combat operations," was commissioned by the Joint Chiefs of Staff before the war and compiled by 34 military officers and 23 civilians at the US Joint Forces Command in Norfolk, Va., who were dispatched to Iraq at the start of the war to track how the military branches coordinated operations.
The draft provides a highly technical assessment of the gamut of military activities, from prewar planning to intelligence and logistics. It highlights a series of deficiencies, including the inability of US and allied forces to identify each other on the battlefield and prevent friendly fire; difficulties in providing supplies to forces that were rapidly on the move; the limited ability to track Iraqi military forces as they dispersed; and inadequate preparations before the war to equip National Guard and other reserve forces to take on a significant role. The draft said the preparations for seizing weapons of mass destruction facilities and other sites in Iraq -- missions conducted by Sensitive Site Exploration Teams, or SSEs -- were inadequate.
"Multiple SSE organizations were created with overlapping missions," it said. "This caused unnecessary competition for limited resources and reduced the effectiveness of all the groups."
Commanders chose an artillery unit, the 75th Artillery Brigade, to take control of sites with suspected weapons of mass destruction, even though it had virtually no experience or training for the mission. The brigade's mission soon expanded to include searches for Iraqi archives, war crimes evidence, terrorist hide-outs, regime leaders, and prisons.
The brigade was improperly trained for these missions, which were "far from the one for which it was designed," said the report.
No weapons of mass destruction have been found in Iraq, even though the military created a special survey group to lead the search after the combat phase.
Other key findings in the report include:
The intense, hand-to-hand combat expected in urban areas never materialized, so "our ability to conduct this sort of fight is not yet proven."
Some Iraqi troops evaded intelligence gathering, exploited adverse weather such as sandstorms to disperse, and have not been caught yet.
The military did little since the Gulf War to improve coordination to prevent deaths from friendly fire. For instance, ground forces had seven different "combat identification systems" and no way to identify one another. A Patriot missile shot down a British fighter plane, killing its crew.
The report praised the policy of "embedding" media with American combat units: "Public access to the battlefield through media proved to be a significant and overall positive component."
Overall, the assessment depicts a highly successful effort that employed many of the advances in military science of the past decade. The United States used about half of troops it employed in the Gulf War to envelop all of Iraq, not merely evict Iraqi forces from Kuwait as US forces did in the Gulf War. It used 15 percent of the munitions it used in 1991, although both wars lasted about the same amount of time.
"The terms historically used for measuring success in conflict are now less meaningful," the report said. "Forces are moved, operated, and sustained in a way that focuses more on generating effects than quantifying space occupied."
Indeed, special forces, on the order of 10,000, were twice the number that served in the 1991 war and more than three times larger as a proportion of the whole force engaged in combat. The small, elite units were able to take control of half of Iraq and almost single-handedly bottled up 11 Iraqi divisions.
Still, the report cautioned that Operation Iraqi Freedom could be a poor model for future fights. Iraq had 30 percent of the ground forces and 25 percent of the aircraft that it had in 1991, along with 60 percent of the air defenses. US Central Command had more than a decade of "corporate memory" of Iraqi miltary capability to prepare for the onslaught.
"Before the beginning of major combat . . . the United States continued to enforce the no-fly zones in northern and southern Iraq," the report said. "Additionally, these operations had been used to shape the battle space for the upcoming conflict. This extensive shaping affected how much effort was needed during the combat phase."
In the future, it concluded, the military is "not likely to have the same levels of experience or the time during a crisis to build the types of cohesive teams that marked CENTCOM's success."

? Copyright 2004 Globe Newspaper Company.
------------------------------------------------

Syria seeks our help to woo US
By John Kerin
March 27, 2004
SYRIA has appealed to Australia to use its close ties with Washington to help the Arab nation shake off its reputation as a terrorist haven and repair its relations with the US.
Secret talks between the two nations have been under way for months but have become more urgent as rogue nations reconsider their role in allowing terrorists to thrive, in light of the US determination to take pre-emptive military action.
A Syrian embassy will be opened in Canberra in weeks and Australia is considering reopening its mission in Damascus.
Australia's close relationship with Washington, and its much higher profile in the Middle East, have prompted Syrian Foreign Minister Farouq al-Shara'a and parliamentary speaker Mahmoud Al-Ibrache to appeal to Canberra to help bring their country back in from a US-imposed diplomatic freeze.
Syria has sent a delegation to Australia and has hosted a series of visits by Australian parliamentarians.
Drawing on the British-sponsored return of Libya to the international fold, Australia is demanding that Syria take a tougher role against terrorists, particularly those using the nation as a base for operations into Iraq.
Australia also has called on the former Soviet client state to abandon any pursuit of weapons of mass destruction before it returns to the fold.
Syria has supported the war on terror but the Bush administration has been sceptical about its commitment, fearing Iraqi weapons of mass destruction were smuggled across the border before the US-led invasion last year.
In November, senior Syrian officials asked a bipartisan Australian delegation led by National Party senator Sandy Macdonald to use Australia's influence with the US to achieve a diplomatic rapprochement.
Senator Macdonald said yesterday: "Syria is a country that has been a bastard state for nearly 40 years. But the leaders we spoke to in Syria appear keen to make linkages with the West and it sees Australia as having influence in Washington."
The overtures to Syria are seen as a response to the West's determination to confront rogue nations that may either pose a threat themselves or pass on weapons to terrorists.
Foreign Minister Alexander Downer last night welcomed Syria's commitment to broadening dialogue with the international community.
"We would like to see Syria follow Libya's example in making a genuine return to the international community," he said through a spokesman.
"But Syria must abandon any effort to attain weapons of mass destruction, act to control the flow of terrorists across its border with Iraq and step up support for the war on terror."
He said Australia was considering reopening an embassy in the Syrian capital, Damascus. The embassy was closed in 1999 because of cost-cutting.
Syria's Melbourne-based honorary consul, Antonios Zyrabi, confirmed to The Weekend Australian last night that Syria wanted Australia to help it come in from the diplomatic cold.

? The Australian

>> WHAT ABOUT THOSE STILL IN POWER? WHERE IS SADDAM
? & SONS? WILL THE BANKS DISGORGE?


Press Release:
http://www.transparency.org/pressreleases_archive/2004/2004.03.25.gcr_relaunch.html
Plundering politicians and bribing multinationals undermine economic development, says TI

Transparency International's new Global Corruption Report 2004 charts the flow of stolen assets, recommends ways to recover money looted by despots, and sets out new Standards on Political Finance and Favours

London, 25 March 2004



Political corruption undermines the hopes for prosperity and stability of developing countries, and damages the global economy," said Peter Eigen, Chairman of Transparency International (TI), launching the TI Global Corruption Report 2004 (GCR 2004 ) today. "The abuse of political power for private gain deprives the most needy of vital public services, creating a level of despair that breeds conflict and violence. It also hits the pockets of taxpayers and shareholders worldwide. The problem must be tackled at the national and international level," he said.

"The GCR 2004 , with a special focus on political corruption," said Eigen, "is a call to action to bring integrity and accountability into governance, to stop bribery by multinational companies, and to curb the flow of stolen assets into secret bank accounts in the west." TI is the leading international non-governmental organisation combating corruption worldwide.

"Democracies can no longer tolerate bribery, fraud and dishonesty," states former US President Jimmy Carter in a foreword to the GCR 2004 , "especially as such practices disproportionately hurt the poor."

The GCR 2004 details funds allegedly embezzled by political leaders of the past two decades. During his misrule, Mohamed Suharto, President of Indonesia from 1967-98, is alleged to have stolen US$15-US$35 billion in a country where the GDP per capita hovers at around US$700. Suharto tops the table of corrupt politicians.



Where did the money go? - The top 10

Head of government Estimates of funds allegedly embezzled GDP per capita (2001)
1. Mohamed Suharto President of Indonesia, 1967-98 US$ 15 to 35 billion US$ 695
2. Ferdinand Marcos President of the Philippines, 1972-86 US$ 5 to 10 billion US$ 912
3. Mobutu Sese Seko President of Zaire, 1965-97 US$ 5 billion US$ 99
4. Sani Abacha President of Nigeria, 1993-98 US$ 2 to 5 billion US$ 319
5. Slobodan Milosevic President of Serbia/Yugoslavia, 1989-2000 US$ 1 billion n/a
6. Jean-Claude Duvalier President of Haiti, 1971-86 US$ 300 to 800 million US$ 460
7. Alberto Fujimori President of Peru, 1990-2000 US$ 600 million US$ 2,051
8. Pavlo Lazarenko Prime Minister of Ukraine, 1996-97 US$ 114 to 200 million US$ 766
9. Arnoldo Alem?n President of Nicaragua, 1997-2002 US$ 100 million US$ 490
10. Joseph Estrada President of the Philippines, 1998-2001 US$ 78 to 80 million US$ 912




Transparency International Standards on Political Finance and Favours

1. Donations to political parties and candidates to elected office must not be a means to gain personal or policy favours. Parties and candidates must practise transparency. Governments must implement adequate conflict-of-interest legislation.

2. Political parties, candidates and politicians should disclose detailed information about assets, donations, in-kind donations, loans and expenditure, on an annual basis as well as before and after elections, to an independent agency.

3. Independent public oversight bodies endowed with the necessary resources must effectively supervise the observance of regulatory laws and measures. Together with independent courts, they must ensure that offenders are held accountable and duly sanctioned. 4. Diversified funding should be sought through: state funding and subsidised access to the media; the encouragement of small donations and membership fees; and controls on corporate, foreign and large individual donations. Spending limits should be considered.

5. Candidates and parties must be given fair access to the media. The media should play an independent role, free from political interference, both in election campaigns and in the broader political process.

6. Civil society should have the opportunity to actively participate in promoting adequate legislation in the field of political finance and in the monitoring of political finance and its impact on political representation.

The full text of the TI Standards is available in the TI Global Corruption Report 2004






http://www.globalcorruptionreport.org/download.htm


Part one
Political corruption
TI 02 chap01 7/1/04 11:39 Page 9
TI 02 chap01 7/1/04 11:39 Page 10
1 Introduction
Robin Hodess1
What is political corruption?
Political corruption is the abuse of entrusted power by political leaders for private gain,
with the objective of increasing power or wealth.2 Political corruption need not involve
money changing hands; it may take the form of `trading in influence' or granting
favours that poison politics and threaten democracy.
Political corruption involves a wide range of crimes and illicit acts committed by
political leaders before, during and after leaving office. It is distinct from petty or
bureaucratic corruption in so far as it is perpetrated by political leaders or elected
officials who have been vested with public authority and who bear the responsibility
of representing the public interest. There is also a supply side to political corruption -
the bribes paid to politicians - that must be addressed.
Political corruption is an obstacle to transparency in public life. In established
democracies, the loss of faith in politics and lack of trust in politicians and parties
challenge democratic values, a trend that has deepened with the exposure of corruption
in the past decade.3 In transition and developing states, political corruption threatens
the very viability of democracy, as it makes the newer institutions of democracy
vulnerable.
Political corruption is a primary focus of Transparency International's work. Indeed,
one reason for selecting political corruption as the theme of this year's Global Corruption
Report is the priority of this issue in TI's network of national chapters around the world,
many of which hold political corruption to be a major concern in their country and
have made political corruption a focus of their advocacy efforts.
The impact of political corruption
The revelation of political corruption often sends shockwaves through a society. Yet,
despite strong demands for justice, prominent world leaders who are suspected of
corruption prove difficult to prosecute or convict. Many leaders are out of office or dead
before their crimes come to light. TI has put together a list of alleged embezzlers from
Sani Abacha to Mohamed Suharto (see Table 1.1, page 13), showing estimates of the
money they allegedly stole as compared with per capita income. This list is a powerful
reminder of just how massive and devastating the scale of abuse can be.
Introduction 11
TI 02 chap01 7/1/04 11:39 Page 11
The general public around the world has taken note of political corruption. TI's
Global Corruption Barometer (see `Global Corruption Barometer 2003', Chapter 11,
page 288), a new instrument that assesses the general public's experiences of and
attitudes towards corruption, finds that if citizens could wave a magic wand to eliminate
corruption from just one institution, more would choose to clean up political parties
than any other institution. For parties, which play a crucial role in public life in any
democracy, the message is clear: there must be absolute probity of party members and
officials, and parties themselves must clean up their internal practices.
Business people also sense the effects of political corruption. A survey by the World
Economic Forum shows that business people believe that legal donations have a high
impact on politics, that bribery does feature as a regular means of achieving policy
goals in about 20 per cent of countries surveyed, and that illegal political contributions
are standard practice in nearly half of all countries surveyed (see Box 2.4, `Political
corruption: a global comparison', page 30).
Political corruption points to a lack of transparency, but also to related concerns
about equity and justice: corruption feeds the wrongs that deny human rights and
prevent human needs from being met. Former UN High Commissioner for Human
Rights Mary Robinson argues that corruption hinders participation in political life and
proper access to justice (see box `Corruption and human rights', page 7).
Focus of the report
This year's Global Corruption Report focuses on corruption in the political process, and
on the insidious impact of corrupt politics on public life in societies across the globe.
It addresses the following areas in the context of political corruption:
* the regulation of political finance
* the disclosure of money flows in politics and the enforcement of political finance
laws
* elections - specifically vote buying
* the private sector - with a focus on the arms and oil sectors, and
* tackling the abuse of office - including reducing conflicts of interest, limiting
recourse to immunity, pursuing extradition and repatriating stolen wealth.
The report also evaluates various mechanisms that can curb corruption in politics,
from citizen action to the creation of new international norms and standards, such as
Transparency International's Standards on Political Finance and Favours (see below).
By focusing on the above topics, the Global Corruption Report addresses particular
weak spots in political life: the abuse of money in the political system by candidates
and political officials; the lack of transparency about money flows in politics; the
potential of the private sector to purchase influence, distorting both the marketplace
and the fair representation of the public interest; the corruption of the electoral process;
and the ways the legal system can affect the ability of states to pursue justice in major
corruption crimes.
Political corruption 12
TI 02 chap01 7/1/04 11:39 Page 12
We chose these areas for a number of reasons. First, the prominence we give to
political finance (whether campaign finance or political party finance) reflects the
fact that often political corruption starts here, with financing. There is a great deal of
concern about the cost of elections in both new and established democracies as well
Introduction 13
Box 1.1: Where did the money go?
Table 1.1 illustrates the scale of the problem of alleged political corruption through
estimates of the funds allegedly embezzled by some of the most notorious leaders of the
last 20 years. To put the figures in context, the right-hand column gives the GDP per capita
of each country.
The 10 leaders in the table are not necessarily the 10 most corrupt leaders of the period
and the estimates of funds allegedly embezzled are extremely approximate. The table is
drawn from respected and widely available sources. In general, very little is known about
the amounts allegedly embezzled by many leaders.
Table 1.1
Head of Estimates of funds GDP per
government allegedly embezzled capita
(2001)
Mohamed Suharto President of Indonesia, 1967-98 US $ 15 to 35 billion US $ 695
Ferdinand Marcos President of Philippines, 1972-86 US $ 5 to 10 billion US $ 912
Mobutu Sese Seko President of Zaire, 1965-97 US $ 5 billion US $ 99
Sani Abacha President of Nigeria, 1993-98 US $ 2 to 5 billion US $ 319
Slobodan Milosevic President of Serbia/Yugoslavia,
1989-2000 US $ 1 billion n/a
Jean-Claude Duvalier President of Haiti, 1971-86 US $ 300 to 800 million US $ 460
Alberto Fujimori President of Peru, 1990-2000 US $ 600 million US $ 2,051
Pavlo Lazarenko Prime Minister of Ukraine, 1996-97 US $ 114 to 200 million US $ 766
Arnoldo Alem?n President of Nicaragua, 1997-2002 US $ 100 million US $ 490
Joseph Estrada President of Philippines, 1998-2001 US $ 78 to 80 million US $ 912
Sources:
GDP figures: UN Human Development Report 2003 (New York: Oxford University Press, 2003); IMF Country Report
No. 02/269 (2002).
Suharto: Time Asia, 24 May 1999; Inter Press, 24 June 2003.
Marcos: CNN, February 1998; Time Asia, 24 May 1999; UN Office on Drugs and Crime (UNODC), Anti-Corruption
Toolkit, version 5, available at www.unodc.org/unodc/en/corruption_toolkit.html
Mobutu: UN General Assembly, `Global Study on the Transfer of Funds of Illicit Origin, Especially Funds Derived
from Acts of Corruption', November 2002; Time Asia, 24 May 1999.
Abacha: UNODC, Anti-Corruption Toolkit; BBC News (Britain), 4 September 2000; see also `Repatriation of looted
state assets', Chapter 6, page 100.
Milosevic: Associated Press, 2 December 2000.
Duvalier: Robert Heinl, Nancy Heinl and Michael Heinl, Written in Blood: The Story of the Haitian People 1492-1995
(Lanham: University Press of America, 1996); Time Asia, 24 May 1999; UNODC, Anti-Corruption Toolkit; L'Humanit?
(France), 11 May 1999.
Fujimori: Office of the Special State Attorney for the Montesinos/Fujimori case, Peru.
Lazarenko: Financial Times (Britain), 14 May 2003; Chicago Tribune (United States), 9 June 2003.
Alem?n: BBC News (Britain), 10 September 2002.
Estrada: CNN, 22 April 2001; Inter Press, 24 June 2003.
TI 02 chap01 7/1/04 11:39 Page 13
as about the influence of private money on political outcomes and the lack of public
information on the real sources of political funding.
In looking at corrupt forms of political finance, we demystify the topic (see Table
2.1, `Major types of political finance-related corruption', page 20) and expose the legal
and systemic obstacles to cleaning up political finance. Our report presents the pros
and cons of bans, limits, disclosure rules and public funding as remedies to corruption
in political finance - and provides evidence from a number of countries where these
measures are in place.
We then feature one remedy to corrupt political finance - disclosure - that is central
to the philosophy and approach of Transparency International. Disclosure of the flow
of money in politics, whether financing parties or candidates or spent on elections or
on public contracting, is critical. Political finance needs to be accounted for and, above
all, clean. There is very little justification for anything but maximum transparency
about political funds. This emphasis on disclosure tends to be a point of consensus for
politicians and activists alike. Yet the reality of disclosure rules, and their enforcement,
tells a different story - one in which there are numerous ways to limit disclosure.
Enforcement is the linchpin of a successful political finance regime: even the best
laws are valuable only if they are enforced. In nearly every country, enforcement has
proved perhaps the most difficult element to realise in a framework designed to stop
political corruption. Effective enforcement requires appropriate powers of investigation
on the part of the agencies involved, an independent and competent judiciary as well
as the necessary political will. We include reports that look at enforcement in practice,
via various types of sanctions, providing a sense of what works and why.
In addition to evaluating rules for candidates, parties and governments, we also assess
what role the private sector plays in political corruption. We feature experts on the
arms and oil sectors who evaluate recent revelations of political corruption with an eye
to what made corruption possible. We endeavour to analyse current reforms of business
practices, particularly those pursued as a result of civil society efforts.
Political corruption is not limited to political finance. We use this special section
to consider a form of political corruption that affects the election process the world
over: vote buying. Our contributors assess why and how vote buying occurs and how
it changes not only elections and their outcomes, but also the relationship between
elected officials and voters. As a number of other institutions are dedicated to the
assessment of practices such as the rigging of ballots, we decided to focus on vote
buying, a corrupt political practice that has received less systematic analysis.4
To complete this special section, we sought to capture how justice is often difficult
to pursue. Contributors reflect on the use (and abuse) of immunity and laws on conflict
of interest, obstacles to repatriation and the cumbersome process of returning stolen
public assets. In all of the above, contributions focus on the legal hurdles faced by
prosecutors and populations in many alleged crimes of political corruption. They also
detail the way forces of change are emerging at both the international and national levels.
Throughout the section on political corruption, we feature Transparency
International's 2003 Integrity Awards winners. Many of these individuals - some of whom
paid for their integrity with their lives - demonstrate that it is possible to fight the system,
Political corruption 14
TI 02 chap01 7/1/04 11:39 Page 14
to stand up to political corruption and to demand an end to the damage it causes to
all people.
`Corruption. Moral decay. Political parties. Opportunism.'
Rac, Panama
Transparency International: shining a spotlight on political corruption
Political corruption can elicit a number of responses. One is voter apathy, accompanied
by public disillusionment with democracy and its capacity to limit corruption. Another
response, the one we at Transparency International aim to capture in our report, is
the ignition of citizen action - and, in some cases, positive government and private
sector measures.
How can society address the issue of political corruption? One answer, which builds
on an idea presented in the Global Corruption Report 2001, is to set standards of probity
in political finance.5 This volume introduces Transparency International's own Standards
on Political Finance and Favours (see Box 1.2, page 16), which can serve as benchmarks
for policy-makers and activists, to be adapted to national (or local) settings. They provide
a normative framework. TI's Standards go further than many of those currently available,
as they include civil society's critical role in monitoring political transparency.6
Political leaders, elected by the public and vested with the power to shape public
life, owe it to citizens to set better standards regarding their use of money, and their
conduct, both in and out of office.
Transparency International will continue to speak out against political corruption
- and will remain resolute in its commitment to greater transparency in the political
process. TI's Standards on Political Finance and Favours are one aspect of our global
advocacy efforts, which also include the following aims:
* The ratification and enforcement of the UN Convention against Corruption.
TI will monitor the ratification and enforcement of the convention, encouraging each
signatory to adopt and apply national legislation that complies with the convention.
The convention requires ratification by 30 countries before coming into effect.
Introduction 15
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Political corruption 16
Box 1.2: Transparency International's Standards on Political Finance and Favours
The TI Standards on Political Finance and Favours are based on the values of integrity, equity,
transparency and accountability. They arise out of concern about the influence of money and
favours in politics, which undermines democratic processes and the rule of law. They are
presented against the background of an international commitment to countering corruption
expressed in the UN Convention against Corruption, at this writing due to be adopted in
December 2003, and they are anchored in the global recognition of human rights endorsed
in the Universal Declaration and related conventions.
1. Curbing influence peddling and conflicts of interest
Donations to political parties, candidates and elected officials should not be a means
to gain personal or policy favours or buy access to politicians or civil servants. Parties
and candidates must themselves practise transparency and demonstrate commitment
to ethical standards in public life. Governments must implement adequate conflict of
interest legislation, including laws that regulate the circumstances under which an
elected official may hold a position in the private sector or a state-owned company.
2. Transparency through disclosure and publication
Political parties, candidates and politicians should disclose assets, income and
expenditure to an independent agency. Such information should be presented in a
timely fashion, on an annual basis, but particularly before and after elections. It should
list donors and the amount of their donations, including in-kind contributions and
loans, and should also list destinations of expenditure. The information should, subject
to consideration of demonstrable security risks to donors or recipients, be made
publicly available in a timely manner so that the public can take account of it prior to
elections.
Furthermore, publicly held companies should be required to list all donations to
political parties in any country in their annual reports to shareholders and consideration
should be given to requiring shareholder approval for such donations.
3. Effectiveness in the enforcement and supervision of regulatory measures
Public oversight bodies must effectively supervise the observance of regulatory laws
and measures. To this end, they must be endowed with the necessary resources, skills,
independence and powers of investigation. Together with independent courts, they
must ensure that offenders be held accountable and that they be duly sanctioned.
The funding of political parties with illegal sources should be criminalised.
4. Diversity of income and spending limits
Careful consideration should be given to the benefits of state funding of parties and
candidates and to the encouragement of citizens' participation through small donations
and membership fees. Consideration should also be given to limiting corporate and
foreign support, as well as large individual donations.
To control the demand for political financing, mechanisms such as spending limits
and subsidised access to the media should be considered.

TI 02 chap01 7/1/04 11:39 Page 16
TI is particularly concerned that the convention's provisions on asset recovery be
realised. Stolen wealth must be returned to its rightful owners. This aim dovetails with
TI's campaign to trace laundered money, launched at Nyanga in March 2001.7
In addition to setting standards for its signatories to stop bribery, the UN itself must
be vigilant, targeting unfair practices (such as vote buying) within the UN system.
* The strengthening of the OECD Anti-Bribery Convention.
Not only must the Anti-Bribery Convention be better enforced, but it must also be
amended to include a ban on bribery of foreign political parties and their officials (see
`Will the OECD Convention stop foreign bribery?', Chapter 7, page 128).
* The establishment of political corruption on the donor agenda.
International financial institutions and bilateral donor agencies must consider more
carefully political corruption in countries to which they lend or grant money, yet
establish sensitive evaluation criteria regarding corruption levels (see `Governance,
corruption and the Millennium Challenge Account', Chapter 7, page 135). Recipients
of international aid need incentives to improve their records on transparency and
enforcement of political finance rules, conflict of interest legislation and the granting
of immunity.
* The enhancement of legislation at the national level on political funding, disclosure
and conflict of interest, and the strengthening of institutions in the area of enforcement.
TI will promote better legislation as well as its enforcement at both national and
international levels, in the hope that stonger and more comprehensive legal regimes
against political corruption will have a direct impact on the achievement of justice.
Transparency International demands that civil society actors around the world be
Introduction 17
5. Fairness and integrity in access to the media
Candidates and parties should have fair access to the media. Standards for achieving
balanced media coverage and media integrity must be established, applied and
maintained. The media should play an independent and critical role, both in election
campaigns and in the broader political process. Instruments such as conflict of interest
legislation should be used to prevent political control of public and private media
from creating a bias in the coverage of politics.
6. Civil society participation
Civil society should actively participate in promoting adequate legislation in the field
of political finance and in the monitoring of political finance and its impact on political
representation. The legal framework, both regulatory and institutional, must enable
civil society organisations, in conjunction with independent media, to undertake such
activities. This framework should also provide access to information, the opportunity
for civil society input on pending legislation, and legal remedies, among other measures.
TI 02 chap01 7/1/04 11:39 Page 17