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BULLETIN
Thursday, 30 September 2004

CONTINUED AT

http://maximpost.blogspot.com/

Posted by maximpost at 1:27 AM EDT
Permalink
Monday, 27 September 2004

N. Korea `ready' to fire off missile
By NOBUYOSHI SAKAJIRI, The Asahi Shimbun
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WASHINGTON--North Korea may be bluffing, but it appears ready to launch one or more Rodong ballistic missiles capable of hitting Japan anytime it wants, according to a senior U.S. official.
On the other hand, Pyongyang's posture may simply be aimed at gaining leverage in future negotiations, the official told The Asahi Shimbun here Thursday.
The official, speaking on condition of anonymity, said latest U.S. intelligence showed that preparations for a launch of the medium-range missile appear complete.
``My understanding is they right now could shoot it anytime they want,'' the official said. ``They are pretty well prepared to do it. There might be a few more steps they have to take, but they will not take long.''
The official's comments suggest North Korean technicians have filled rockets with liquid fuel. Thus, it would only be a matter of hours before a missile was ready for launch. The official suggested that the technicians may only need to conduct final checks before blast-off.
Washington, like Japan, is stepping up surveillance of the Korean Peninsula to try to ascertain whether Pyongyang is bluffing in an attempt to gain concessions at six-way talks on its nuclear development programs, or in fact is getting ready to fire a missile.
The U.S. official said the intelligence was gleaned from satellites and monitoring of telecommunications. He said the Pentagon is fairly certain that Pyongyang is preparing to launch or test-fire a Rodong missile.
The official noted that the North was well aware its moves are being monitored by the United States. He indicated that launch preparations are being done at sites easily visible from the sky, not at mobile launch pads hidden in forests.
Some in Washington believe North Korea ``expects us to go running to them, begging them to stop,'' the official said. This, he theorized, might be a North Korean gambit to gain concessions from the international community in return for its agreement to freeze its nuclear and missile programs.
The official said Washington is not ruling out the possibility the North is ``actually preparing for a launch.''
He noted that Pyongyang expressed its hope during recent six-nation talks that the United States and other participants-Japan, South Korea, Russia and China-would reward North Korea for shelving its nuclear and missile ambitions.
The official said the United States would not be intimidated, adding there is no possibility of Washington altering its position that North Korea abandon its programs in a verifiable manner.
Meantime, U.S. Secretary of State Colin Powell on Thursday warned North Korea not to break the extended moratorium on missile launches it promised Japan in 2002.
``I think it would be very unfortunate if the North Koreans were to do something like this and break out of the moratorium that they have been following for a number of years,'' Powell told a news conference in New York after meeting with South Korean Foreign Affairs and Trade Minister Ban Ki Moon.
Powell called such a development ``a very troubling matter'' for China, Russia and Japan.(IHT/Asahi: September 25,2004) (09/25)



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Prospect of North Korean Missile Launch 'Alarming' to Seoul
By Glenn Kessler
Washington Post Staff Writer
Friday, September 24, 2004; Page A19
UNITED NATIONS, Sept. 23 -- South Korean Foreign Minister Ban Ki Moon said Thursday that intelligence indicating a possible launch of a North Korean ballistic missile is "very much alarming" and that it could set back diplomatic efforts to resolve the crisis over Pyongyang's nuclear ambitions.
"We have gotten that intelligence report that North Korea appears to be preparing to launch a missile," Ban said in an interview. "We are very concerned about the North Korea activities. We hope that they will not launch this kind of missile at this time."
Ban said a missile launch would have an "immensely negative adverse impact on the ongoing six-party dialogue process," referring to the six-nation talks over North Korea's nuclear program, "as well as the ongoing South-North relationship. And I think their relationship with Japan will be very much affected in a negative way."
Secretary of State Colin L. Powell, attending meetings on the sidelines of the U.N. General Assembly, told reporters that "it would be very unfortunate if the North Koreans were to do something like this and break out of the moratorium that they have been following for a number of years." But Powell said a missile launch would not "change our approach to dealing with the North Korean nuclear problem."
Ban said he did not understand why North Korea would appear to be scheduling a missile launch, except to alarm countries in the region and gain "an upper hand" in the nuclear talks. A fourth round of talks was set for this month, but North Korea has balked at attending.
A U.S. military officer who monitors Asia said the missile in question is believed to be a new intermediate-range model detected in North Korea in the past year. U.S. analysts have said the land-launched missile is derived from the Soviet SS-N-6, a 1960s-era submarine-launched model. Some reports estimate its range at more than 3,500 kilometers -- enough to reach Guam, a U.S. territory with a large military presence.
Adding to the tension, North Korea's state-run Rodong Sinmun newspaper declared Thursday: "If the United States ignites a nuclear war, the U.S. military base in Japan would serve as a detonating fuse to turn Japan into a nuclear sea of fire."
In 1998, North Korea test-fired a ballistic missile over Japan into the Pacific Ocean. After receiving the new intelligence, Japan was reported to have sent two destroyers and a surveillance aircraft to the Sea of Japan to monitor North Korea's activities.
Ban said South Korea is "very much frustrated" that another round of talks appears unlikely soon. He said he recently told his North Korean counterpart that "they should not wait for the U.S. presidential election -- that whoever will be elected, Republican or Democrat, there will be no fundamental changes in addressing the issue."
Democratic candidate John F. Kerry has said he would allow direct talks with North Korea, but Ban noted that such talks have already taken place during the six-nation discussions, so he does not know whether there is "any substantial difference."
Staff writer Bradley Graham contributed to this report.
? 2004 The Washington Post Company

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Son of N. Korean Leader Arrives in Beijing?
A figure assumed to be the eldest son of North Korea leader Kim Jong-il arrived at Beijing International Airport on Saturday.
The man, who asserted himself to be the son of the "North Korean leader," wore a dark blue sports jacket, white shirt, and sunglasses, insisting to reporters in Korean, "I'm Kim Jong-nam."
PHOTOS
A man believed to be Kim Jong-nam who arrived in Beijing on Saturday (left) and the real Kim Jong-nam (right)
http://english.chosun.com/w21data/html/news/200409/200409250018.html
Making use of a flight other than a flight from Pyongyang, which arrived at Beijing in this morning, he said he had traveled to several countries since being deported from Japan in 2001 after he tried to enter the country on a fake passport.
He didn't say which country he had passed through on his way to China, and when asked about Koh Young-hee, the wife of Kim Jong-il, who was rumored to have died recently, he said "I don't know."
He was alone, and nobody picked him up. "I will stay at a hotel in Beijing," he said as he took off in a taxi.
The son of the late former actress Song Hye-rim, Kim Jong-nam was busted and deported by Japanese authorities after he tried to enter Narita International Airport with two women and a four-years old boy in May 2001. It is surmised that he has wandered about various regions including Moscow and Beijing.
(englishnews@chosun.com )






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US offers to sell F-16s to Pakistan
By Joshua Kucera JDW Staff Reporter
Karachi, Pakistan
Additional reporting by Michael Sirak JDW Staff Reporter
Washington, DC
The US is offering to sell 18 F-16 fighter aircraft to the Pakistan Air Force (PAF) pending Congressional approval: one of several such deals in the works after years of US-led defence sanctions against Pakistan, the PAF Chief of Staff has disclosed.
"[The Americans] have indicated that they are ready to give us F-16s," said Air Chief Marshal (ACM) Kaleem Saadat. "This is not a rumour; it is from the American government."
Pakistan said it hopes the deal is the beginning of greater US co-operation. "Eighteen I consider to be the first instalment of what would follow," ACM Saadat told JDW. Approval from Congress, however, is not likely to come until after the US elections in November, he said.
Pakistan is asking that the F-16s be equipped with Advanced Medium-Range Air-to-Air Missiles (AMRAAMs). Along with additional fighter aircraft, Pakistan has also outlined a requirement for a beyond-visual-range missile, which the AMRAAM would meet.
In 1988-89, Pakistan arranged to supplement its stock of 40 F-16A/Bs - about 32 of which remained in service as of 2003 - by ordering an additional 71 aircraft. Lockheed Martin began producing them, but then the US Congress imposed sanctions in 1995 that barred military sales to the country unless the US president could certify that Pakistan was not pursuing nuclear weapons.
As a result, only 28 of the 71 were ever built and none of them were delivered to Pakistan. Instead they were kept in storage in the US until the Bush administration reimbursed the Pakistanis financially and assigned 14 aircraft each to the US Air Force and Navy in June 2002 for training and testing purposes.
The episode still rankles in Pakistan and the renewed possibility of acquiring F-16s is seen partly as making amends in thanks for Pakistan's efforts as an ally of the US in the wake of 9/11.
"Right from day one, we have been impressing upon the US government what symbolic value the F-16 has for the Pakistani people and the Pakistani nation," ACM Saadat said. "So it's not as if 10, 15, 20 aircraft would make a world of difference in our operational capability, but it's a symbol in the sense that the people of Pakistan think that if they give us this then they are really sincere in helping us."

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Russia's new pre-emptive strategy
Kremlin generals have studied US doctrine
Borrowing a leaf from the current US military manual and responding to the massacre of the Beslan school children, General Yuri Baluevsky, the Russian Chief of General Staff, announced last week that his country's military now reserved the right to "launch pre-emptive strikes on terrorist bases... in any region of the world".
No Western government publicly responded to this Russian statement. Yet, privately, Western military planners are beginning to worry about what the official shift in Moscow's policies may actually mean. Moscow's claim that it is fighting the same war on terrorism as the United States is not taken seriously. The people who belong to Al-Qaeda and who struck at the US three years ago, rejected everything America stood for: its economic prowess, its technological advances and its notions of society. For Osama bin Laden, the war is an apocalyptic clash of civilisations, a global confrontation between religions.
The terrorism that faces Russia today is of a different variety. It was born out of a war for the liberation of one ethnic group. The militants who attacked the US were foreign; those who attacked Russia were, nominally, its own nationals. Furthermore, Al-Qaeda rejects the concept of the Western world, whereas the Chechens want to join this world, albeit as a separate nation.
The Chechens are not fighting in the name of Islam, although they happen to be Muslim. They fight for the nationalist aspiration of independence. Al-Qaeda and its allies cannot be negotiated with, even if they were to give up violence. But, at least in theory, there is an answer to the Chechen problem, namely that of granting independence to this Russian province. The conclusion, therefore, is that the Russian government's threat to deploy its armed forces around the world represents nothing more than an attempt to avoid discussing the real issue: the future of the Chechen nation.
Furthermore, unlike the Americans, who had to deal with a country like Afghanistan that shielded terrorists, there is no government that supports Chechen terrorists. Even Russia's claims that it is facing an international terrorist movement are doubtful. Immediately after the terrorist attacks on a theatre building in Moscow two years ago, the Russians asserted that Arab fighters were involved. Not a single Arab was subsequently produced as evidence; all turned out to be local Chechens. The same claim was made after the horrific massacre in the school. Even before all the bodies of the murdered children and adults were identified, Russia mysteriously already claimed to know that 10 of the attackers were Arabs. But, yet again, the evidence never appeared. The reality is rather simple: although some links with other terrorist organisations may exist, the bulk of Chechen terrorism has always been home-grown.
What are the Russians up to?
So, why are the Russians still insisting on their own doctrine of military pre-emption against alleged overseas terrorists? There are two reasons. The first is long term and remains strategic. Ever since the end of the Soviet Union, the Russians have wanted to maintain control over the oil-rich and strategically important Caucasus region and especially over the neighbouring republic of Georgia. The Georgian government, now assisted by the presence of some US military personnel, has always resisted these Russian advances. Under the guise of fighting terrorism, the Russians now hope to reimpose control over Georgia. It is rather convenient that they can do so by using the same justification that the Americans are using elsewhere in the world. But, more importantly, Russia's pre-emption doctrine represents a free-for-all for its secret agents. For years, the Russian government demanded the extradition of Chechen political leaders who sought asylum in other countries, claiming that they were terrorists. Without exception, courts in Western countries rejected these claims as unfounded. Well before the school massacre, however, the Russian security services adopted a new technique -- that of simply assassinating such people. The former Chechen president was assassinated in the Gulf state of Qatar in February and further assassinations are sure to follow. Yet again, the Russian authorities will claim that they are doing nothing different from what the US Central Intelligence Agency has done. In practice, however, the Russians are targeting all those Chechens with whom a peaceful deal to the crisis can still be negotiated -- far from eliminating terrorism, they are eliminating the chances for any political settlement.
Our prediction: Wholesale assassinations of Chechen protagonists and Russian bullying of Georgia. Do not expect Western governments to say anything about it either.

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Ukraine arms Cuba and Venezuela
Ukraine's arms exports last year stood at US$530-550m, an increase on the year before when they were officially recorded at $440m. JID's regional analyst looks at the implications of Kiev's weapons policy.
Ukrainian experts analysing this highly secretive sector of Ukraine's foreign trade believe that the volume of military exports could rise to an annual maximum of $700m. Of course, these figures do not include the large volume of unofficial trade in weapons. Since 1992, Ukrainian arms have ended up in many conflict zones around the world, including Peru, Sierra Leone, Afghanistan, Iraq, Yemen, Pakistan, Malaysia and Sri Lanka.
This year's figures for military exports will be heavily boosted by the establishment of two new markets namely Cuba and Venezuela. Sources involved in preparing the contracts have informed JID that the first shipments of military equipment to Cuba and Venezuela are scheduled to take place sometime during September and October.
The Ukrainian Ministry of Defence has recruited officers with Spanish language fluency. These experts have been promised additional increments on their low salaries in return for travelling with the shipments to Cuba and Venezuela. The officers who are set to accompany the shipments will include language experts and interpreters, as well as specialists able to train the Cubans and Venezuelans in the use of the military equipment being supplied. During September and October it is expected that the military equipment will be installed on site in both countries.
The volume of equipment to be sent by the oddly-named Ministry of Machine Building (Ministerstvo mashinostroeniya), which is heavily involved in Ukraine's military exports, will be equally divided between both countries. The bulk of the military equipment being sent to Cuba and Venezuela is light to medium equipment. This includes light infantry weapons coupled with small and medium sized military vehicles. JID has learned that negotiations are underway for Ukraine to supply more sensitive and strategically important military equipment to both Cuba and Venezuela.
Throughout the summer, hundreds of pages of documents to accompany the weapons shipments have been translated into Spanish and English. These documents include operating manuals, an inventory and the contracts. It is understood from sources involved in organising the shipment that the contracts are for the supply and maintenance of the military equipment, in addition to training, for between five to 10 years.



17 June 2004
Ukraine's missing missiles
Since March, Ukraine's defence minister, Yevhen Marchuk, has been searching for missing missiles and other weapons that could have fallen into terrorist hands or been sold to rogue states. JID investigates why this potentially catastrophic situation is only now being brought to light.
Marchuk raised a domestic storm when he publicly revealed that the Defence Ministry had no unified accounting system. Nor has a comprehensive inventory of military equipment in Ukraine ever been carried out. It is unknown what weapons the Defence Ministry actually possesses or what it inherited from the former Soviet Union.
When Marchuk became defence minister in June 2003 he ordered two inventories that indicated US$170m of military stock was probably missing. These results were so shocking that Marchuk ordered a new team of investigators to conduct an additional check using different methods. They uncovered that additional equipment, worth $20m, was missing.
Ukraine's officially declared revenue from the sale of military equipment is $3bn. This, according to JID's inside sources, only represents a small fraction of the real volume of Ukraine's military exports. Meanwhile, Marchuk has complained that there is no data available to him regarding the quantity of military equipment Ukraine inherited after the disintegration of the Soviet Union.
The sheer scale of what appears to be missing equipment is astounding, as demonstrated by just one example. In 1990-1991, on the eve of the break up of the Soviet Union, 1,942 S-185 rockets were delivered to the Zhytomir military base, west of Kiev. These rockets were to be dismantled.
In fact, only 488 of the 1,942 rockets can actually be accounted for. The missiles could have been sold to unknown groups or countries. Or their scrap metal, gold, platinum and silver could have been sold separately with the proceeds being transferred to offshore accounts.
"We are looking for several hundred missiles. They have already been decommissioned, but we cannot find them," complained Marchuk.


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JTIC briefing: Hizbullah's escalating role in the Palestinian intifada
By David Eshel
Lebanese Hizbullah is taking advantage of the present power vacuum in the West Bank and Gaza to expand its involvement in supporting the intifada, Israel security officials fear. JTIC examines evidence of recent Hizbullah activity in the Palestinian Territories.
Since the outbreak of the Al-Aqsa intifada in 2000, Israel has expressed growing concern over what it claims is the involvement of Lebanese Hizbullah in supporting the activities of Palestinian militant groups. Indeed, the group's leadership itself has openly declared its support for the Palestinian 'resistance' in the form of money, propaganda and 'popular participation'.
There is firm evidence that Hizbullah's initial activities particularly involved provision of propaganda support to the Palestinians using their television and internet news outlets. However, since 2001 it has become apparent that not only has Hizbullah's assistance become increasingly operational in nature, but that the group and its sponsors may be attempting to establish themselves as major power-brokers in the Territories, at a time when much of the Palestinian Authority (PA) is in disarray and the main militant groups have been largely forced onto the back foot by sustained Israeli counterterrorist pressure.
Establishing the exact nature and true extent of Hizbullah's present involvement in the intifada is a difficult undertaking given the abundance of disinformation surrounding the issue from both Israel and the Arab world. However, a steadily growing body of information now points toward an intimate involvement by Hizbullah in training, arming, and attempting to gain some influence over domestic Palestinian militant groups. Israeli intelligence sources insist that Hizbullah, thanks to its Iranian patronage, is providing significant funds to the militants, training their cadres at Hizbullah camps in South Lebanon and smuggling operatives into the Occupied Territories to provide bomb-making and other operational expertise.
What is Hizbullah's objective? If Ariel Sharon proceeds with his plan to completely withdraw from the Gaza Strip in 2005, then the ultimate security nightmare for Israel, government officials warn, would be a repeat of the 2000 Israel Defence Force (IDF) pullout from the 'buffer zone' it occupied in South Lebanon.

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from the September 27, 2004 edition - http://www.csmonitor.com/2004/0927/p07s01-wome.html
Israel sends Syria tough message with Hamas strike
The killing of a Hamas operative Sunday underscores Israel's intolerance for radicals in Syria.
By Ben Lynfield
JERUSALEM - Widening its pursuit of Hamas beyond the occupied territories, Israel reached into Damascus Sunday, dealing a blow to both Hamas and Syria.
Even as part of official Israel declined to comment Sunday on the death of Izz el-Deen al-Sheikh Khalil, a Hamas operative killed in a car bomb, Israeli security sources told the Associated Press and the Haaretz newspaper that Israel was indeed responsible.
After last month's double bus bombing in the southern city of Beersheba, claimed by Hamas, Israeli army Chief of Staff Moshe Yaalon had said that Israel would "deal with those who support terror" including those "in terror command posts in Damascus."
But Israeli analysts say the killing of Mr. Khalil was more than retribution. Operationally, it deprives Hamas of a key military leader, they say, while it also sends a tough signal to Syria that Israel will not tolerate its hosting of Hamas and other radical groups in Damascus.
"Khalil was the Salah Shehadeh of Damascus," says a former security official who requested anonymity. He was referring to the chief military leader of Hamas in Gaza who was assassinated by a one-ton bomb dropped on his residence in Gaza City two years ago.
The former official says that Khalil was responsible for smuggling weapons into the Gaza Strip from Egypt and for organizing armed operations in the West Bank and Gaza Strip. "The capability of Hamas to activate attacks in the West Bank and Gaza from outside will be reduced for a while," he says.
"Also," he continues, "this attack inside Syria's capital shows the authorities in Damascus that it cannot be used as a hiding place. This is a blow to the prestige of the regime."
In Damascus, a neighbor of Khalil who identified himself only as Nabil said, "He said good morning to us like he did everyday and walked to his car. He got into his car and then the phone rang. When he took the call we heard the explosion. We rushed toward his car and found pieces in the back seat."
Ahmad Haj Ali, an adviser to the Syrian information minister described the bombing as a "terrorist and cowardly action."
Ghazi Hamed, editor of the Hamas-affiliated al-Risala weekly, faults Washington for the bombing. "Israel would not do this without American permission," he says. "The United States is threatening Syria that 'Israel will attack you if you don't do what we want.' "
Khalil was the latest in a string of Hamas leaders to die at Israel's hands, the others better known than he was. Sheikh Ahmed Yassin, the movement's founder, was assassinated by a helicopter gunship in March as he left a mosque after prayers and acting leader Abdul-Aziz Rantissi was killed a month later.
"Following the killing of Yassin and Rantissi, the leadership outside became much more important," says Reuven Paz, director of the PRISM research institute in Herzliya, near Tel AviV. He estimates that there are 20 to 30 Hamas officials in Damascus that deal with foreign relations, finance, and directing military operations.
But Mr. Hamed says the Damascus headquarters is political and not military: "Israel believes that if it cuts the legs and hands of Hamas outside, then it will impact on Hamas here. I don't think so."
He says the armed wing in the occupied territories is independent and does not receive its orders from outside. Asked about Khalil, Hamed said he did not know what positions he held. He recalled that Khalil was deported to Lebanon along with 414 other Hamas figures in 1992, but, unlike the others, he did not to return to the occupied territories when they were allowed back.
Damascus, according to Mr. Paz, is no longer a safe place for Hamas not only because of Israeli military action but because of American pressure on Syria to oust radical groups headquartered there.
"Regimes like the Syrian regime might think that they are next after Iraq," he says. "And maybe [President] Bashar Assad would like to renew peace negotiations with Israel. He could easily sell out the Hamas leadership to improve his situation with the US or Israel."
Paz believes that despite the Israeli military strikes, Hamas is a highly durable organization inside the occupied territories.
"This is not just a terrorist organization, it has a well-organized social, educational, and cultural infrastructure which is seen as incorrupt. They might take a break now [from attacks] to invest more efforts in the municipal elections" beginning on Dec. 9, in which Hamas will field candidates, he says.
But Sami Abu Zahari, the Hamas spokesman in Gaza, pointed toward revenge.
"This crime expands and enlarges the struggle into Arab lands. The reply is obvious: escalating the attacks. We count on our Arab and Moslem youth to take action," he told Al Jaazera in an interview Sunday.
* Wire services contributed to this report.


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Arab Nations Fail to Support Lebanon
By Luke Thomas
Sep 17, 2004
In an appalling but all too common display of despotism and indifference, Arab nations throughout the Middle East failed to condemn Syria's suppression of Lebanese sovereignty.
As the Digital Freedom Network observed on Friday, September 10:
On September 3, the Lebanese parliament, under intense pressure from the Syrian government, approved an amendment to the Lebanese constitution that will allow current president Emile Lahoud to service a second term of three years.
Following the passage of this amendment, the United Nations (UN) passed resolution 1559 which called for full national sovereignty for the Lebanese and respect for Lebanon's constitution while also calling for the removal of all foreign troops without specifically mentioning Syria.
In addition to international condemnation from the U.S. and European Union (EU), local press and various religious and political leaders widely castigated the move. Four members of parliament under chief Druze MP, Wahlid Jumblatt, resigned in the aftermath.
The general expectation of behavior for Syria's Arab neighbors following its regrettable maneuvering of power was if not outright condemnation, certainly nothing indicating praise or approval. Unfortunately, approval was all that was to be found.
According to reports from The Daily Star, "Egypt appeared to have stood with Damascus Wednesday, as Egyptian President Hosni Mubarak reportedly rejected international condemnation of Syria's domination of Lebanese politics."
Ironically, Syria's official news agency, SANA, reported that Mubarak and Syria's leader, Bashar Al-Asad, called for "total Lebanese sovereignty" and repudiated UN Resolution 1559.
There are indications that "strong initial warnings" by Egypt, Jordan and Arab Gulf States for Syria to not interfere in the Lebanese electoral and constitutional affairs were altered or removed after intense lobbying from Syria.
Presumably, Syria introduced a goal of mutual interest that could be achieved given that there was unanimity between Arab parties. Forcing further U.S. difficulties in the increasingly dangerous Iraq is arguably chief among those.
With respect to Resolution 1559, Syria and Egypt deflected attention from the political arm-twisting by noting the need for a "realistic and political framework that would lead at the same time to the end of the Israeli occupation of all Syrian and Lebanese territory."
Lebanese Foreign Minister Jean Obeid reiterated that position, according to The Daily Star, by observing, "Lebanon was being asked to deal with the issue of the national anti-Israel resistance without bearing in mind that there is Lebanese land still under Israeli occupation."
Also there is the shared history of Syria and Egypt in the 1967 Six-Day War where both countries ceded territory to Israel in an overwhelming military defeat. While Egypt officially made peace with Israel under the leadership of the late Anwar Sadat, Syria still believe it is entitled to those lands (the Golan Heights), though has neither the means nor the real desire to attempt any recapture.
Michael Young of Reason Magazine and The Daily Star argues any serious implementation of Resolution 1559 is difficult, especially in the context of Syria's ties to Hezbollah, Islamic Jihad and Hamas. Recall that recent Israeli threats against Damascus came in the form of Syrian government approval of Hamas offices in Syrian territory, operating unfettered and to nearly full capacity. Israel argues it has the right to attack those targets, even if they exist in foreign territory. Young observes, "It's difficult to imagine either the U.S. or Israel agreeing to new Syrian-Israeli talks unless Syria severs its ties with Hezbollah, Hamas, or Islamic Jihad." As long as Syria is tethered to these extremist groups, any negotiations over the Golan territory, and thus the implementation of Resolution 1559 as both Israel and Syria withdraw from occupied territory, remains somewhat of a pipe dream.
In fairness to the complexities of international diplomacy and history, both Israel and Syria maintain that occupation of West Bank and some Lebanese territory, respectively, is necessary to counterbalance the presence of the other.
On Wednesday, September 15 Syria criticized the U.S. Congress resolution that was passed two days earlier, condemning Syria's record on human rights abuses and calls for the U.S. government to combat the problem. The Daily Star reports as follows:
Syria's Information Minister Ahmad Hassan dubbed the resolution "worthless," adding that it bears the clear mark of the Zionist lobby in the U.S. congress.
House Resolution 363 called for the condemnation of the "continuing gross violations of human rights" and demanded support for the "civil liberties of the Syrian people by the Government of the Syrian Arab Republic."
The resolution passed unanimously without hesitation, thus rendering Syria's claim of surreptitious Zionist influence little more than baseless assertions.
In a very telling sign of the state of failure in Arab States, former Lebanese President Amin Gemayal, a member of Christian opposition, told The Daily Star Resolution 1559 "is different from all previous UN resolutions pertaining to Lebanon" and "it is the first time that a UN resolution intervenes in the internal relations among Arab states."
Gemayal added "this shows the failure of Arab states to resolve their problems internally."
So what does all this mean?
If one were to combine Syria's hand wrangling of Lebanese affairs, lobbying of foreign Arab governments for support, repudiating of international criticism, repudiating of domestic and Lebanese concerns, flippant attitude toward UN resolutions, deflecting of attention back to the U.S. and Israel away from its' failures, what we find is the unfortunate, but thoroughly unsurprising reality of politics in the Middle East.
Once again, Arab regimes have failed to come to rescue of fellow Arab nations by shamefully supporting ghastly actions of neighborhood dictators (there is also the gross failure to uphold the much heralded Pan Arabism). Again, this is not surprising. It is in many ways very unreasonable to expect Mubarak to outright condemn Syria while he presides over a police state. In his view, Assad's situation is nearly tantamount to his with respect to attitudes from Washington, although Mubarak is not accussed of having and likely has no ties to terrorism. Regardless, a man whose sole interest is power cannot be expected to exhibit forthcoming behavior on issues of disclosure and morality.
What it will take to alter the climate of Arab politics is unclear, but it unquestionably must involve massive amounts of concessions and negotiations. Given the actions of Egypt and other Arab nations, such a prospect is little more than a glimmer in the eye.
Copyright ? 1997 - 2004 Digital Freedom Network

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China Detains N.Y. Times Researcher
Reuters
Friday, September 24, 2004; Page A22
BEIJING, Sept 23 -- China has detained a researcher working for the New York Times on suspicion that he helped break news that aging leader Jiang Zemin planned to retire from politics this month, sources familiar with the case said Thursday.
Zhao Yan, a former reporter for the magazine China Reform, was arrested by state security agents on Sept. 17. Jiang stepped down from his post as head of the military on Sept. 19, during the annual meeting of the ruling Communist Party's Central Committee.
Earlier this month, the newspaper quoted sources as saying Jiang would hand the chairmanship of the Central Military Commission to Hu Jintao, his successor as president and party chief, at the plenum, completing a leadership transition that began at a party congress in 2002.
Zhao was taken into custody on suspicion of illegally providing state secrets to foreigners, according to a copy of an arrest document issued by the Beijing state security bureau and dated Sept. 21.
State security "suspect him to be the source of the Jiang Zemin story," said a source speaking on condition of anonymity. Zhao has worked for the New York Times since May.
The Times's foreign editor, Susan Chira, denied the charges and said the paper was "deeply concerned" about the case.
? 2004 The Washington Post Company

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U.N.derwhelming Response
The U.N.'s approach to terrorism.
By Anne Bayefsky
In the weeks immediately following 9/11 there is another anniversary -- that of the U.N.'s response to the global threat of terrorism. On September 28, 2001, the Security Council adopted Resolution 1373, which requires states to take steps to combat terrorism.
That resolution has proved, however, to be the high-water mark. Despite Senator Kerry's repeated calls for greater U.N. involvement in the war on terror, the organization's contribution has gone downhill ever since.
Three years after resolution 1373 was passed, the U.N. still can't even define terrorism. Member states are essentially divided into two camps. In one corner is the Organization of Islamic Conference (OIC) composed of 56 states insisting that terrorism excludes the "armed struggle for liberation and self-determination." More precisely, blowing up Israelis of all ages in cafes, synagogues, buses, and discotheques is considered legitimate. In the other corner is the rest of the world.
For eight years the U.N. has been struggling to adopt a comprehensive convention against terrorism. But it cannot finish the task because the OIC continues to hold out for an Israeli exclusion clause. Another round of bogus negotiations is scheduled for early October. No U.N. member state is prepared to change the rules and insist that a vote be called in the absence of consensus.
The upshot is one line on the U.N. website devoted to the definition of terrorism. It refers interested parties to the ongoing discussion over a terrorism convention that "would include a definition of terrorism if adopted."
The U.N.'s inability to identify a terrorist has real-life implications. In the last month, the Security Council has been faced with terrorist acts in Beslan, Russia, and in Israel. A recent bombing in Beersheva, Israel, claimed 16 lives and wounded 100 from a population of under seven million. The hostage-taking in Russia left 326 dead and 727 wounded out of a population of over 143 million. Proportionally, the trauma was as great in Israel.
The Security Council deadlocked over the Beersheva attacks and no unified presidential statement was possible. Instead there was a statement to the press saying council members (read: some, not all) condemned the bombings along with "all other acts of terrorism" (code for "Israel engages in terrorism too"). During the debate, Security Council members Algeria and Pakistan maintained a position of "principle" -- there should be no double-standards, no singling out of one act, no selective condemnation. That was August 31.
On September 1 the Security Council adopted a presidential statement on behalf of the council as a whole concerning Beslan. It strongly condemned the attack, expressing the deepest sympathy with the people and government of Russia and urging all states to cooperate with Russian authorities in bringing to justice the perpetrators, organizers, and sponsors of the terrorist acts.
Of course the council couldn't mirror such calls when it came to Israeli victims, since the perpetrators, organizers, and sponsors of Palestinian terrorism start with Yasser Arafat and end in the protectorates of Damascus and Tehran. What happened to Resolution 1373?
The resolution's legal requirements are impressive: to "refrain from providing any form of support, active or passive, to entities or persons involved in terrorist acts"; to "take the necessary steps to prevent the commission of terrorist acts"; to "deny safe haven to those who finance, plan, support, or commit terrorist acts"; and to "prevent those who finance, plan, facilitate or commit terrorist acts from using their respective territories for those purposes against other States or their citizens..."
To implement these obligations, 1373 gave birth to a Counter-Terrorism Committee (CTC). The CTC then spawned 517 state reports about all the steps being taken to implement the resolution. Among them is the most recent report from Syria -- headquarters of Hamas, the Popular Front for the Liberation of Palestine, and others featured on the State Department list of foreign terrorist organizations. It informs the Security Council about "procedures and measures adopted and in force in the Syrian Arab Republic aimed at the suppression....and prevention of terrorist crimes, and...the denial of safe haven, refuge, assistance or any form of help in the territory of...Syria."
A parallel universe, one in which the U.N.'s chief global response to 9/11 -- the Counter-Terrorism Committee -- has never managed to name a single terrorist organization or individual, or a singe state sponsor of terrorism.
Another U.N. committee was created in 1999 under Security Council Resolution 1267, in response to al Qaeda and the Taliban. This so-called sanctions committee has never agreed about which states have failed to comply with their obligations, nor has it given the council a list of delinquent states for further action.
Meanwhile, almost all of the rest of the world stands paralyzed, intimidated, or furiously giving campaign speeches about U.N. multilateralism as the sensitive way forward in the war against terror.
-- Anne Bayefsky is an international lawyer and a senior fellow at the Hudson Institute.

http://www.nationalreview.com/comment/bayefsky200409240915.asp
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Options for Prosecuting Forgery Exist, but Appear Unlikely
By Robert B. Bluey
CNSNews.com Staff Writer
September 20, 2004
(CNSNews.com) - Tampering with government records is a felony under the Texas Penal Code, but prosecutors in Taylor County said they are not likely to pursue a case, even if the controversial CBS memos on President Bush were sent from a Kinko's fax machine in Abilene.
Prosecuting a forgery in Texas under section 37.10 would be just one of several options available under state, federal or military law. But the likelihood of any criminal charges being brought against an individual or CBS are remote, based on interviews conducted by CNSNews.com.
"I know some documents were faxed from Abilene that were purported to be fraudulent, and that's all I know," said James Eidson, the district attorney for Taylor County, which includes Abilene. "We're not an investigative agency. It would have to be turned over to us by some other agency."
The law enforcement agency most likely to look into the matter - fraud investigations are handled by the Texas Department of Public Safety - has not heard from any Texas prosecutor who might be willing to take the case, according to a spokeswoman.
"On certain things, we won't pursue investigating a case unless we have a letter from whoever the prosecutor would be," said Tela Mange, a spokeswoman for the department. "We don't want to expend investigative resources and time and money on a case that a prosecutor might not pursue."
According to the Texas statute, anyone who "makes, presents, or uses any record, document, or thing with knowledge of its falsity and with intent that it be taken as a genuine governmental record" could be charged with a felony.
Even though CBS has refused to disclose the source of the documents that it aired on the Sept. 8 episode of "60 Minutes II," there are clues that indicate they may have come from Texas. The records were about Bush's service in the Texas Air National Guard, and one CBS source, former National Guard officer Robert Strong, said they bore the stamp of the Kinko's in Abilene.
The transmission of forged documents via a fax machine could result in a prosecution under the federal wire fraud statute, according to University of Texas law professor Samuel W. Buell, who worked as a federal prosecutor for 10 years. But he warned that even if that was the case, money would have likely had to be involved.
After researching federal laws that might pertain to the CBS matter, Buell said most statutes applied to forging currency as opposed to falsifying government records.
"There are a set of federal forgery statutes limited to certain matters that are within the jurisdiction of the federal government," Buell said. "For example, currency obligations, treasury certificates, bonds, postage meters and generally things that have monetary value."
Federal statutes referring to military records also make no reference to memorandums like the ones obtained by CBS, Buell said. Penalties would apply, he said, in cases of forged discharge certificates and military identification cards.
A spokeswoman for the U.S. Attorney's Office for the Northern District of Texas, which covers Abilene, referred CNSNews.com to the Department of Justice. The department declined to comment on the matter.
A third option - besides a state or federal prosecution - involves military law. But it would likely be the most remote choice given the type of crime, said Margaret D. Stock, a law professor at the U.S. Military Academy. Stock offered her personal assessment to CNSNews.com.
"A minor case of someone altering a document might never even go to a court martial," Stock said. "It might be handled administratively with a reprimand."
A military prosecution becomes complicated, Stock explained, because it could involve bringing a retired military officer onto active duty.
The Uniform Code of Military Justice, which applies to the National Guard as well as other military branches, has a provision on forgery that punishes anyone who "utters, offers, issues, or transfers such a writing, known by him to be so made or altered."
Any active duty officer today could lodge a complaint if the source of the documents turned out to be associated with the military, Stock said. But the chance of anything materializing would be slim in her opinion.
"It would be more likely that the [U.S. attorney] would prosecute than the military because it's easier for them to get jurisdiction," she said. "I would think it would be easier for the federal civilian prosecutor to handle the case rather than a military prosecutor."
And while an individual may face little threat of prosecution, according to legal sources, CBS has far greater protection under the First Amendment, said media law professor Rick J. Peltz, who teaches at the University of Arkansas at Little Rock. He said he wasn't aware of any legal precedent involving a media organization charged with criminal fraud.
"Even besides actual malice, the constitutionality of criminal defamation laws is highly suspect," Peltz added. "I'm not sure I can see a theory for criminal liability."
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Pentagon think tank sees Iran nukes by 2005
SPECIAL TO WORLD TRIBUNE.COM
Friday, September 24, 2004
A leading Pentagon-funded think tank has determined that Iran could be as little as a year away from producing its first nuclear bomb.
The report by the Washington-based Nuclear Nonproliferation Policy Education Center provided the harshest assessment yet of Iran's nuclear weapons program. The report, partly funded by the Pentagon, also reviewed U.S. responses to Iran's program, but ruled out a military strike.
On Tuesday, Iran said it has begun converting 37 tons of raw yellowcake uranium for enrichment by gas centrifuges, Middle East Newsline reported. U.S. officials said the announcement reflected Teheran's intention to accelerate its nuclear weapons program.
"Iran is now no more than 12 to 48 months from acquiring a nuclear bomb, lacks for nothing technologically or materially to produce it, and seems dead set on securing an option to do so," the report, released on Sept. 13, said.
The assessment by the center came only weeks after the intelligence communities in Israel and the United States concluded that Iran sustained a setback in its race to achieve nuclear capability. In August, Israel's intelligence community asserted that International Atomic Energy Agency inspections of Iranian nuclear facilities prompted a suspension of uranium enrichment and the transfer of such equipment from civilian to military bases.
Iranian engineers need between one to four years to develop nuclear warheads, the report said. The think tank said Iran has the equipment to produce nuclear weapons fuel, the expertise to assemble bombs and the missile delivery systems.
The study was drafted with the help of leading U.S. experts on Iran, the Middle East, and nuclear weapons. The experts warned that a nuclear Iran would increase its support for organizations deemed terrorist, boost the price of oil and spark an arms race in the region.
"With Hamas in decline, Iran has already been seen to be increasing its support to groups like Hizbullah in Israel and Lebanon who want to liberate Palestine from 'Israeli occupation,'" the report said. "Increasing this aid certainly would help Iran take the lead in the Islamic crusade to rid the region of Zionist and American forces and thereby become worthy of tribute and consideration by other Islamic states. Also, bolstering such terrorist activity would help Teheran deter Israel and the U.S. from striking it militarily."
The report said U.S. and allied policy-makers have been drafting plans to prevent Iran from acquiring nuclear weapons. The think tank said the two most widely-examined choices were to bomb or bribe Iran.
"Neither, however, is likely to succeed and could easily make matters worse," the report said. "Certainly, targeting Iran's nuclear facilities risks leaving other covert facilities and Iran's nuclear cadre of technicians untouched."
"As for eliminating Iran's nuclear capabilities militarily, the U.S. and Israel lack sufficient targeting intelligence to do this," the report added.
"As it is, Iran could have already hidden all it needs to reconstitute a bomb program assuming its known declared nuclear plants are hit."
Instead, the report recommended that the United States lead naval exercises throughout the Persian Gulf. The exercises should seek to improve allied capability to clear mines, protect merchant ships, seize nuclear cargo and ensure traffic in the Straits of Hormuz.
Another recommendation was that the United States offer missile defense systems to allies in the Middle East. The think tank warned that such an offer must ensure that recipient states could not use these systems for offensive purposes.
The study warned that a nuclear Iran would spark similar programs in a range of Middle East states. Algeria, Egypt, Iraq, Saudi Arabia, Syria and Turkey -- all signatories of the Nuclear Non-Proliferation Treaty -- were the most likely to seek nuclear weapons, the study said.
In early 2004, the report said, senior Saudi officials announced they were studying the possibility of acquiring nuclear weapons from China or Pakistan. At the same time, Egypt announced plans to develop a large nuclear desalinization plant and could have received sensitive nuclear technology from Libya.
"Egypt, Algeria, Syria, and Saudi Arabia will all claim that they too need to pursue nuclear research and development to the point of having nuclear weapons options and, as a further slap in Washington's face -- and Tel Aviv's -- will point to Iran's 'peaceful' nuclear program and Israel's undeclared nuclear weapons arsenal to help justify their own 'civil' nuclear activities," the report said.
The report said Israel's role was crucial to any U.S. response to a nuclear Iran. The think tank recommended that the United States and its allies -- prior to the Nuclear Non-Proliferation Treaty review conference in May 2005 -- persuade Israel to take unilateral steps meant to dampen the prospect of a nuclear arms race throughout the Middle East.
"Israel should announce how much weapons usable material it has produced and that it will unilaterally mothball -- but not yet dismantle -- Dimona, and place the reactor's mothballing under IAEA monitoring," the report said. "At the same time, Israel should announce that it will dismantle Dimona and place the special nuclear material it has produced in 'escrow' in Israel with a third trusted declared nuclear state, e.g., the U.S."
"It should make clear, however, that Israel will only take this additional step when at least two of three Middle Eastern nations -- Algeria, Egypt or Iran -- follow Israel's lead by mothballing their own declared nuclear facilities that are capable of producing at least one bomb's worth of weapons usable material in one to three years," the report said.
Copyright ? 2004 East West Services, Inc.

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Europe loses patience with Iran over arms
(Filed: 25/09/2004)
France's foreign minister, Michel Barnier, insisted yesterday that Iran must assure the world that it does not plan to acquire atomic weapons as European nations lost patience with Teheran over its nuclear programme.
Diplomats close to negotiations in which Britain, France, and Germany are trying to persuade Iran to abandon its uranium enrichment programme said the Europeans might soon be ready to support American demands to refer it to the United Nations Security Council.
Iran said this week it had begun processing raw uranium to prepare it for enrichment, a process that can be used to develop nuclear bombs.
Mr Barnier said Iran urgently needed to reassure the world about its nuclear programme, which Teheran says is purely for nuclear energy.
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Iran, Impossible?
Nope. The mullahs will go the way of the Evil Empire.
After years of baffling silence, George Will has finally written about Iran. His guide is the justly celebrated Azar Nafisi, but her one-liner Will used to portray contemporary Iran -- "What differentiated this revolution from the other totalitarian revolutions of the twentieth century was that it came in the name of the past" -- demonstrates a serious misunderstanding of the past (the F?hrer's movement was every bit as anti-modern as Khomeini's) and thus of the future (both forms of fascism being quite capable of asserting a terrible revolutionary claim on the destiny of all mankind and unleashing their murderous hatred on a global scale).
Worse, Mr. Will tosses off a dismissive pronunciamento so absolute and categorical that he implies it is writ in the very nature of things: "There is no plausible path to achieving (regime change in Iran)." Why? Because "the regime-changers have their hands full with the unfinished project next door to Iran."
He'd have done better to concentrate his great talent and energy on preventing major-league baseball from reaching Washington, D.C. The claim that the United States cannot possibly bring about the fall of clerical fascism in Tehran is as silly as similar claims directed at Ronald Reagan when he set about bringing an end to the evil Soviet Empire. Indeed, skepticism about our determination to defeat Soviet Communism was far more justifiable than doubts about the thoroughly plausible path to end the Iranian mullahcracy. For only a small minority of the oppressed peoples of the Soviet Empire were ever willing to openly challenge the Kremlin -- as, for that matter, were the people in the Philippines under the Marcos kleptocracy, or in Yugoslavia under the mad Milosevic. Yet all came crashing down, defeated by their own people, who were inspired and supported by Americans.
In Iran today, upwards of 70 percent of the population is openly hostile to the regime, vocally desirous of freedom and democracy, and bravely supportive of the Bush Doctrine to bring democratic revolution to the entire region.
If we could bring down the Soviet Empire by inspiring and supporting a small percentage of the people, surely the chances of successful revolution in Iran are more likely. By orders of magnitude. "No plausible path," my derriere! (as Senateur Kerry might put it). Ask Comrade Gorbachev about the power of democratic revolution before you write off the Iranian people.
I think that Mr. Will got it wrong because he assumes that regime change implies military conquest. But we don't need armies of fighting American men and women to liberate Tehran; the foot soldiers are Iranians, and they are already on the ground, awaiting good leadership with a clear battle plan. The war against the Iranian terror masters will be political, not military. The weapons that will end the dreadful tyranny -- so well described by Mr. Will and Mrs. Nafisi -- are ideas and passions, not missiles and bullets. To our great shame, we have failed to support the Iranians' battle against their hated regime, but that is a failure of will, not a failure of means.
Mr. Will believes it inevitable that Iran will become a nuclear power in the near future, and this may well be a self-fulfilling prophecy. Surely the United Nations, the British, and the Europeans are doing everything possible to bring it to fulfillment. But this is a fallacy of "static" thinking in a rapidly changing world. South Africa and Ukraine were members of the nuclear club when they were oppressive tyrannies, but scrapped their nukes when they became free. It is certainly true that the current Iranian regime will stop at nothing until they have atomic bombs, but a free Iran might well make a different choice.
Most importantly, there is a huge difference between atomic bombs in the hands of fanatical mullahs, and atomic bombs controlled by a pro-Western and democratic country. Mr. Will says it is "surreal" for Condoleezza Rice to discuss the Iranian nuclear program in terms of what we can "allow" Iran to do, I suppose because he is convinced we have no plausible path to prevent it. That may or may not be true; I don't know if there is a politically acceptable military option, and I agree that diplomacy cannot possibly derail the mullahs' mad atomic march. But it is at least equally "surreal" to dismiss the prospects of democratic revolution in Iran, and thereby join the ranks of the appeasers.
If Reagan had listened to this sort of criticism -- and there was no shortage of it in the early '80s -- Gorbachev would still be managing the gulags and funding Communist movements all over the world. If Bush accepts George Will's view of Iran, we will soon see the world's primary sponsor of terror armed with atomic bombs.
It is not inevitable. We can beat them. Delay costs lives, both ours and those of the brave Iranians who challenge clerical fascism.
Faster, please.
-- Michael Ledeen, an NRO contributing editor, is most recently the author of The War Against the Terror Masters. Ledeen is Resident Scholar in the Freedom Chair at the American Enterprise Institute.

http://www.nationalreview.com/ledeen/ledeen200409240934.asp

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Zarqawi's Jordanian roots
By Jon Leyne
BBC Amman correspondent
Zarqa is a dusty, dirty city. The houses sprawl over a series of brown, sun-blasted hillsides. It has a reputation for being the home to the car trade, and for crime.
It is also home to Iraq's most wanted man - Abu Musab al-Zarqawi.
The name means, "the man from Zarqa".
Zarqawi himself has been on the run for years. But his wife and four children still live in a two-storey house on the edge of town. His brother-in-law Saleh al-Hami also lives across the road.
'Thug'
He was eager to put the record straight about his notorious relative.
Zarqawi is a good man, he insisted, a good Muslim, who has gone to Iraq out of principle to fight the American-led occupation.
He is a leader, he is strong, straight to the point, with a very strong personality
Leith Shubeilat, Islamic activist
This rough town provided inauspicious roots for a man the Americans credit with leading a large part of the Iraqi resistance.
When he was in his teens, it seemed that Zarqawi was destined for a life of petty crime. He was known as a bit of a thug, a lowlife.
But while few claim Zarqawi is a great intellectual, it appears he does have the ability to lead: the ability to persuade, or to bully, others to follow him.
"He is a leader, he is strong, straight to the point, with a very strong personality," says Leith Shubeilat, an Islamic activist imprisoned with Zarqawi in the 1990s.
Iraq opportunity
What sounds like an obsessive personality gradually turned Zarqawi from crime to the more dangerous pursuit of radical Islam, with its fiery mix of religion and politics.
He travelled to Pakistan and Afghanistan, although his relationship with Osama Bin Laden is disputed.
In 1993, Zarqawi was arrested in Jordan, after the authorities discovered rifles and bombs stashed in his house.
In the next years in prison, he turned to learning the Koran by heart.
Then in 1999, he was released by the Jordanians as part of a general amnesty.
The war in Iraq was just the opportunity he was looking for to harness his fanatical beliefs.
He is now believed personally to have carried out several of the recent, brutal, videotaped executions.
Though Zarqawi has become a mystery figure, unseen except in those gruesome videos.
Supporters
Zarqawi's brother-in-law, Saleh al-Hami, had no apologies for the recent violence or kidnappings, such as the holding of the British man Ken Bigley.
"Why are the British worried about this one man, and not about the thousands of Iraqis who have been killed or injured?" asked Mr al-Hami.
Most ordinary Jordanians I spoke to in Zarqa insisted they did not support the current wave of kidnappings.
But they did point to that same double standard.
"All the people here in Jordan and the Middle East are against kidnapping the foreigners," said one man I spoke to outside a newspaper shop in Zarqa.
"Our religion does not want these things to happen in Iraq."
"But all the people want to dismiss Americans and British from Iraq, because Iraq is an Arabic country.
"The foreigners, they killed more people than the kidnappers. The American jets killed 200 or 300 daily."
Zarqawi cannot claim many followers in Jordan, though government buildings here are heavily fortified against any possible attacks from him or other Muslim militants.
But people here do understand what drives him, and most ordinary people I spoke to shared his hatred for America's occupation of Iraq and support for Israel.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/middle_east/3691548.stm
Published: 2004/09/27 00:16:05 GMT
? BBC MMIV

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U.S. military intelligence: Saddam transferred WMD to Syria
SPECIAL TO WORLD TRIBUNE.COM
Friday, September 24, 2004
The U.S. military continues to back its estimate that the former Saddam Hussein regime in Iraq transferred much of its weapons of mass destruction arsenal to neighboring Syria.
U.S. officials said that U.S. Army Intelligence does not share the conclusion that Saddam had abandoned his WMD program before the U.S.-led war against Iraq in 2003. They said military intelligence has attributed the U.S. failure to find Iraqi WMD platforms or munitions to Saddam's transfer of these systems to Syria in late 2002 and early 2003.
Over the last year, U.S. Central Command has helped the Iraqi Survey Group in the search for WMD in Iraq. The group has wound down its activities in Iraq without any success.
"The Iraqi Survey Group has yet to submit its final report," Lt. Gen. Lance Smith, deputy chief of U.S. Central Command, said. "Besides, who knows what we will find in two years, who knows what was moved to countries like Syria. What we know for certain is that Saddam Hussein had carried out research into an array of weapons of mass destruction."
Smith said Syria was a major ally of Saddam before and after the U.S. invasion of Iraq. He told a briefing in Qatar on Sept. 5 that Syria helped fuel the current insurgency war in Iraq by enabling the flow of combatants and weapons into Iraq to fight U.S. and allied forces.
The military's assessment that Syria has received Iraqi WMD has been shared by the Defense Department, officials said. They said U.S. reconnaissance satellites had detected the entry of Iraqi convoys of suspected WMD and missile cargo into Syria and Lebanon's Bekaa Valley in early 2003.
"It's a clear fact that the deposits of weapons of mass destruction have not been found since the end of the major combat operations," Defense Secretary Donald Rumsfeld said. "Another possibility is they gave them to some other country or hid them in some other country."
Officials said Saddam agents have sought to kill Iraqis with knowledge of the former regime's nuclear weapons program. They cited the assassination of Iraqi nuclear scientist Mohammed Toki Hussein Al Talakani on Sept. 4 in the Sunni city of Mahmudiya.
In contrast, the United Nations Monitoring, Verification and Inspection Commission for Iraq said it failed to find evidence that Saddam had developed unmanned air vehicles capable of deliverying biological or chemical weapons. The agency said the UAVs found in Iraq did not violate UN restrictions.
"The information available to us doesn't indicate Iraq had these drones for the delivery of chemical or biological weapons agents, nor had they gone beyond the 150 kilometer range," UN commission spokesman Ewen Buchanan said. "But we're open to new information and looking forward to the Iraq Survey Group's findings."
Copyright ? 2004 East West Services, Inc.


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Too much democracy - a mandarin's lament
(Filed: 25/09/2004)
Pity the sincere Europhiles. For many years, these well-bred, well-meaning and in some ways visionary people waged their lonely campaign against public opinion. Then, to their unfeigned delight, Tony Blair was elected, the first prime minister since Edward Heath who seemed willing to advance their agenda.
Mr Blair had an unassailable majority and a clear mandate: in his first speech as Labour leader, he promised: "Britain will never be isolated or left behind in Europe." For a short while, everything seemed possible. But, nearly eight years on, Mr Blair's majority has been squandered, his promise broken. No wonder the pro-Europeans sound so crotchety these days: they can see things slipping away from them.
Nowhere is this frustration more keenly felt than in Whitehall - or, to be precise, King Charles Street. For 40 years, our Foreign Office mandarins have seen themselves as almost sacerdotal figures, guardians of the sacred flame of Britain's European vocation. If you doubt this, read the late Hugo Young's history, This Blessed Plot. Written from a Europhile perspective, the book lays bare the way in which successive generations of FCO bureaucrats maintained a policy of closer European integration regardless of the declared will of their elected bosses.
Sir Stephen Wall, whom we interview today, was for a time the supreme inheritor and exemplar of this tradition. An erudite and respected man, he did his best to pursue a European policy that was wholly at odds with British public opinion. For a while, he saw Mr Blair as a natural ally; but he soon became disenchanted. Not that there was a hint of this while Sir Stephen was in his post: he was a proper and discreet civil servant to the last. Now, though, freed from the constraints of office, he has let rip.
Mr Blair, he says, played politics when he should have been making the case for the EU - and his Chancellor, Gordon Brown, even more so. Here is the authentic voice of the British ?narque: listen closely and you can catch that slight tetchiness at what diplomats think of as populism, but the rest of us would call democracy.
The issue over which Sir Stephen and Mr Blair fell out was the referendum on the EU constitution. Sir Stephen, true to the values of his caste, vigorously opposed the idea of consulting the public. He well understands that the EU would never have got where it is today if each new treaty had been referred to the voters for approval. He can see that people will probably vote "no" to the constitution - not only because of what they read in that document, but also as a surrogate verdict on 30 years of transfers of power to Brussels. For him, as for other Euro-enthusiasts, that is reason enough for not asking them. The EU, as it exists, is the creation of men like Sir Stephen: a bureaucratic construct with little room for democracy. That has been the objection all along.

? Copyright of Telegraph Group Limited 2004

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Aspiring powers fight for seat at UN top table
By Anton La Guardia, Diplomatic Editor
(Filed: 25/09/2004)
The quest by the United Nations to reform the Security Council has turned into a public brawl between aspiring powers seeking a permanent seat and a larger number of jealous neighbours seeking to keep them out.
The battle has been waged all week in New York, where world leaders and ministers are meeting for the annual opening of the UN General Assembly.
India, Germany, Japan and Brazil are united
India, Germany, Japan and Brazil have banded together to promote each other's membership. They have won support from Britain and France - which already hold permanent seats - but they are also facing determined opposition.
Pakistan opposes the entry of India, its nuclear rival. Italy has led the campaign against Germany's membership, while Argentina and Mexico are trying to prevent Brazil gaining a seat.
Nigeria, South Africa and Egypt have also made a case for a permanent seat.
The giants of the Security Council - the United States, China and Russia - have kept largely silent, apparently unwilling to support any attempt at reform, though China was scathing about Japan's ambitions for a permanent seat.
Iraq, terrorism, weapons proliferation, world poverty, climate change are all major issues for this year's General Assembly meeting. But for many at UN headquarters, the question which really animated diplomats was reform.
Almost everybody agrees that the present composition of the Security Council is outdated, reflecting the balance of power at the end of the Second World War.
The council has five permanent members with the power of veto - the United States, Britain, China, France and Russia - together with 10 countries elected for two-year terms.
All attempts to overhaul the membership in the past decade have failed. But Kofi Annan, the UN secretary-general, is now making a fresh attempt. Seeking to re-unite the UN after the deep rift caused by the war in Iraq, he has set up "high level panel" of international figures that will present its proposals in December.
The hope is that reforms will be approved by the General Assembly next year.
The panel will be trying to reconcile two opposing aims: to make the Security Council more legitimate in the eyes of the world by making its membership more representative; and to make it more effective in the eyes of America, which has shown its willingness to turn its back on the UN, by drafting new rules to deal with issues such as terrorism and weapons of mass destruction.
The move has provoked frenzied lobbying and counter-pressure in the corridors of the UN.
President Olusegun Obasanjo of Nigeria, Africa's most populous country, said on Thursday: "Africa, whose issues occupy a substantial part of the Security Council's time, ought to be accorded priority consideration for permanent membership.
"And Nigeria, I strongly believe, is a well-qualified candidate."
The Indian prime minister, Manmohan Singh, said the inclusion of India as a permanent member would be "a first step in the process of making the UN a truly representative body".
But Pakistan made plain its opposition to India's entry. "The overwhelming majority of states are against the creation of new centres of privilege," said President Pervaiz Musharraf.
Italy's foreign minister, Franco Frattini, argued that creating new permanent members would "sow division".
Instead, he backed proposals to create a layer of semi-permanent members which would serve five-year terms.
Britain has said that any new permanent members of the Security Council should not have the power of veto.


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Chernobyl Comes of Age
Melting Myths
By Roger Bate
Posted: Thursday, September 23, 2004
ARTICLES
National Review Online
Publication Date: September 23, 2004
Eighteen years ago, the world's worst nuclear accident occurred. Newspaper reports at the time reflected the near-universal public hysteria: the Daily Mail filled half its front page with the words "2000 DEAD"; the New York Post claimed that 15,000 bodies had been bulldozed into nuclear waste pits. But the overreaction to the accident caused far more harm than the meltdown itself, as it mistakenly led to the halting of nuclear programs in most Western countries, including the United States.
As Chernobyl comes of age, now seems like a good time to take an adult assessment of the whole affair. UNSCEAR's (the United Nations Scientific Committee on the Effects of Atomic Radiation) website tells a surprising story: At 1:21 a.m. on April 25, 1986, the reactor crew at Chernobyl's number four reactor ran a test to see how long the turbines would spin following a power cut. It was known that this type of reactor was very unstable at low power, and automatic shutdown mechanisms had been disabled before the test. The flow of coolant water diminished, power output increased, and when the operator tried to shut down the reactor from its unstable condition arising from previous errors, a peculiarity in the design caused a dramatic power surge. The fuel elements ruptured and the resultant explosive force of steam lifted the cover plate off of the reactor, releasing fission products into the atmosphere. A second explosion threw out fragments of burning fuel and graphite from the core and allowed air to rush in, causing the graphite moderator to burst into flames. The graphite burned for nine days, releasing a total of about 12 x 1018 becquerels of radioactivity--about 30 to 40 times that of the atomic bombs dropped on Hiroshima and Nagasaki.
It just could not be any worse: Corners had been cut from the very inception of the reactor's design, right through construction, operation, and maintenance. Training and safety procedures were negligible. The Supreme Soviet that routinely disregarded human life was as negligent in nuclear-reactor policy as it was in everything else. Even The Simpsons's woeful nuclear power-plant owner, Mr. Burns, would have been ashamed of it.
The complete destruction of the reactor killed 31 people, including 28 from radiation exposure, most of whom were firefighters working on the roof. A further 209 people on site were treated for acute radiation poisoning and 134 cases were confirmed (all of whom recovered). Since then, an increase in childhood thyroid cancer has been reported, although it is not certain that this is not due to increased surveillance. There has been no other increase in radiation-induced disease, congenital abnormalities, or adverse pregnancy outcomes.
If this had been an ordinary industrial accident, safety standards would have been improved, and that would have been the end of the story. For instance, who (apart from those directly affected) remembers the explosion at a fertilizer plant in Toulouse, France, in September 2001? It killed 30 people, injured more than 2000, and damaged or destroyed 3000 buildings.
No, the biggest tragedy of Chernobyl was that radioactivity was governed by preposterous safety regulations that forced the authorities to take extreme and damaging action against the very people they were trying to protect. Until very recently, radiological protection (and chemical regulations) depended on the linear no-threshold (LNT) theory. This says that, because high levels of exposure can cause death, there is no safe lower limit. If this sounds like a reasonable level of precaution, consider this: 750? F will cause fatal burns, while 75? F is a lovely summer's day. Vitamin A is an essential trace chemical in our diet but is toxic at high levels. The dose makes the poison, for chemicals and for radiation.
On the basis of this false assumption, nearly 400,000 people were forcibly evacuated from areas around Chernobyl where radiation was actually lower than the normal background levels in Cornwall and five times lower than at Grand Central Station in New York. To these poor unfortunates, there was damage done. Psycho-social effects among the evacuees are emerging as a major problem. Zbigniew Jaworowski, a medical adviser to the U.N. on the effects of radiation, estimates that nearly five million people in the former Soviet Union have been affected by severe psychological stress, leading to psychosomatic diseases. These include gastrointestinal and endocrinological disorders and are similar to those arising from those that accompany other major disasters such as earthquakes, floods, and fires. Perhaps saddest of all is that as many as 200,000 "wanted" pregnancies ended in abortion, in order to avoid non-existent radiation damage to the fetuses.
It may seem crass to talk about money in this context, but according to the UNDP and UNICEF, over $100 billion was spent just in the Ukraine on post-Chernobyl "public health" measures. Just imagine how much real good could have been done with that much money. Furthermore, Jaworowksi says that the cost to Belarus was about $86 billion. These are astonishing sums for relatively poor former Communist countries.
Apportioning blame between the media and the Supreme Soviet is a difficult task. But unfounded Western fears based on the LNT hypothesis undoubtedly encouraged the Soviet mass evacuation program. Yet that inaccurate LNT hypothesis still forms the basis of radiation thinking--and it's past time that was changed. Nuclear power has dangers, which are less in terms of actual deaths per unit energy produced than most other forms of energy generation. But as long as this exaggerated image of Chernobyl endures, people will continue to imagine the costs of nuclear energy to be far higher than they really are.
Roger Bate is a visiting fellow at the American Enterprise Institute.

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Iraq War Takes Toll on GIs' Mental Health
Friday, September 24, 2004
By Kelley Beaucar Vlahos
WASHINGTON -- Early studies of the emotional ravages of the Iraq war on combat soldiers have spurred some veterans' health advocates to question whether Americans and the U.S. government are truly prepared for the devastating and far-reaching mental health effects of war.
"We are not prepared for the body count we are seeing, mental health or otherwise," said Sue Bailey, former assistant secretary of defense for health affairs during the Clinton administration. "America's mood is not prepared for this."
"The [Veterans Administration] is not geared up and the [Department of Defense] is not geared up," said Rick Weidman, spokesman for Vietnam Veterans of America (search). "That's why some of us have been talking, and you are going to see a major front of veterans saying we need this fixed and we need this fixed now."
According to a study published July 1 in the New England Journal of Medicine (search), 15- 17 percent of combat soldiers surveyed upon their return from Iraq exhibited signs of anxiety, major depression or other mental health problems.
These numbers are significantly higher than in the Persian Gulf War (search), point out mental health and veterans experts. They attribute the lower numbers in 1991 to a shorter war -- 42 days -- and enemy engagement that came mostly from strategic air assaults, not urban warfare (search).
"Because of the nature of this war, there will be more people with mental problems than in the Persian Gulf War - it will be more like the Vietnam War (search)," said Lawrence J. Korb, former assistant secretary of defense under President Reagan and senior fellow for the Center for American Progress (search).
Government officials and some experts say that between the new mental health teams available to troops in Iraq, and a more proactive outreach to soldiers when they get home, the government is better prepared than ever.
"There have been real advances in having the capability to deal with things in real time, in combat," said Bailey.
"I can tell you we have been anticipating, or monitoring very closely, what we think the influx will be," said Alfonso Batres, chief officer for readjustment counseling services at the Veterans Administration (search). "What is different today is that we are really being proactive in trying to reach this group."
According to the NEJM study, during the war in Iraq, 95 percent of Marines and Army soldiers surveyed had been shot at, 56 percent had killed an enemy combatant and 94 percent had seen bodies and human remains.
"There are no clear enemy lines, non-stop pace, the war surrounds the soldier 360 degrees. The enemy can be man, woman or child. This is an extremely stressful situation," said Stephen Robinson, executive director of the National Gulf War Resource Center (search).
Robinson said men and women who in the past would have died in the field have survived thanks to advanced body armor, but in many cases the soldiers are living with severe, life-altering injuries or are watching their friends grapple with them. In other cases, many of the less injured are National Guard and Reservists who are being sent back to the theater two and three times.
According to the Pentagon figures on Monday, 1,032 men and women have died in Operation Iraqi Freedom and 7,245 have been wounded. Of those latter figures, more than half could not return to duty within 72 hours and many resulted in one or more amputations and head injuries due to roadside bombs and patrol ambushes, according to reports.
Several experts gathered in Washington, D.C., on Sept. 14 to discuss what they call the "hidden toll" of the war -- men and women suffering from symptoms of post traumatic stress disorder (search). Symptoms can range from chronic fatigue and confusion to violent mood swings and serious depression.
Though PTSD is as old as war itself - as recently as World War I it was called "shell shock" - veterans' advocates blame the government for not learning its lessons, particularly after Vietnam.
"When we start seeing homeless veterans on the streets, self-medicating, families starting to break up - the toll - you won't be able to hide that. It will be felt by families across America," said Robinson.
"The military and the Veterans Administration are there and ready to support the veterans coming home and we will continue to do so," said Dr. Thomas Burke, an Army colonel and head of mental health policy under the assistant secretary of defense for health affairs.
Batres added that the VA starts seeing soldiers when they are still convalescing in the military hospitals and even have former Iraq and Afghanistan soldiers conducting outreach services in new peer-to-peer counseling.
He said the VA has met with 10,262 veterans from Iraq and Afghanistan. Of that number, 4,314 came to them through local VA centers, and of that number, 25 percent had symptoms of PTSD.
Kaye Baron, a clinical psychologist who has worked with about 75 returning Iraq veterans through her private practice outside of Ft. Carson Army Base in Colorado, said she fears a stigma is still attached to mental health care, and therefore, an unwillingness remains to make mental health services more accessible.
"I have some very significant concerns about us being prepared, or more importantly, being aware or honest as a society to acknowledge that these soldiers are going to have problems, whether they admit it or not," she said.
Baron and others said the NEJM report underestimates the numbers of soldiers affected by the war and the traumatic experiences they've been through. They also complain that despite claims otherwise, the military and VA are not effectively reaching out to soldiers. And without such efforts, most soldiers will not seek help, but will turn to other more destructive outlets.
"The military wants to deny that war hurts people and the society wants to deny that war hurts people," Weidman said.
Burke told FOXNews.com that multiple levels of mental health services are available before, during and after a soldier is deployed overseas, which not only take into consideration the myriad war-related effects on a soldier, but the need to reach out to those who might be hesitant to seek help.
Thus, a new program that allows soldiers to seek help online and through a toll-free hotline number.
"We strongly encourage soldiers to take advantage of the resources available to them," said Burke, who called the NEJM study important, but "not surprising" given the level of combat exposure cited.
Baron said the report suggested that about 25 percent of returned soldiers were drinking excessively. "I know from walking and talking to people that more like 75 percent are indulging in excessive alcohol to self-medicate, to escape," she said.
Barbara Critchfield, a long-time counselor at Shoemaker High School, where nearly 80 percent of the student body has parents deployed overseas through nearby Fort Hood, Texas, said students have begun to talk about returning parents' behavior.
"Some talk about fathers, who all they want to do is drink and sleep -- we know there is PTSD," she said. "I don't know how far-reaching it is, they might be isolated incidents, I don't know."
She said community mental health services are scrambling to hire more personnel and do more. "I think no one was expecting it to be what it is," she said.
FOXNews.com and FOX News Radio

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The Big Mahatma
From the October 4, 2004 issue: Laurence Tribe and the problem of borrowed scholarship
by Joseph Bottum
10/04/2004, Volume 010, Issue 04
SUPPOSE you were doing a little research into the history of Supreme Court nominations, and you learned from one book that Grover Cleveland "bested Benjamin Harrison by almost 100,000 votes in the election of 1888, but the vagaries of the electoral college caused him to lose the election" (p. 130).
And then, browsing through a later book on the topic, you read that Harrison is remembered for "losing the popular election in 1888 by 100,000 votes and still managing to take the Oval Office from incumbent President Grover Cleveland through the vagaries of the Electoral College" (p. 63).
Perhaps you'd think it merely a matter of curious--but not impossible--chance that both authors had used the same, memorable phrase: "vagaries of the Electoral College."
Suppose, however, more curiously, that further along in the newer book was the following description of the controversy surrounding Harry Truman's 1949 nomination of Sherman Minton to the High Court: "several Senators called on Minton to appear before the Judiciary Committee. Minton declined the 'invitation' and said that he would stand on his record as a Senator and a federal appellate judge" (p. 84).
Those ironic quotation marks around the word "invitation" might seem familiar. And, sure enough, there they are--and then some--in the earlier book, as well: "Republican Senators Homer Ferguson of Michigan and Forrest C. Donnell of Missouri requested that Judge Minton appear before the Senate Judiciary Committee to respond to questions. He declined the 'invitation,' noting that he would stand on his record as a Judge and Senator" (p. 231).
By now, of course, your radar would be fully active, and you'd be scouring both books for telltale, otherwise inexplicable parallels. Like the phrase "Holmes mold," which appears in the later book as: "The chairman of the Judiciary Committee, Senator George Norris, immediately made it clear to President Hoover that he and his fellow committee members, mostly Democrats and Progressive Republicans, would insist upon a liberal jurist in the Holmes mold" (p. 80).
In the earlier book, the same sentence can be found almost verbatim: "But almost at once the Chairman of the Senate's Judiciary Committee, George W. Norris, made it plain to the President that he and his fellow committeemen, largely Democrats and Progressive Republicans, would insist on a judicial liberal in the Holmes mold" (p. 191).
It would no longer seem just a coincidence that both books refer to Truman's "buddies" benefitting from a "crony appointment" (p. 224 in the older book and p. 68 in the newer)--followed by "Truman . . . liked them; he liked their politics" in one, and "Harry liked his friends, and he liked their politics" in the other (p. 224 and p. 69).
Or that the earlier book recounts how "Others were rather more specific" when they "urged Hoover to nominate Benjamin Nathan Cardozo, Chief Judge of the New York Court of Appeals"--since, after all, the later book recounts much the same thing, in much the same language: "Others were more specific" when they "urged Hoover to nominate Chief Judge Benjamin Cardozo of the New York Court of Appeals" in the newer (p. 191 and pp. 80-81).
And what if, finally, you were to discover an identical nineteen-word passage in both books: "Taft publicly pronounced Pitney to be a 'weak member' of the Court to whom he could 'not assign cases'"? (p. 164 and p. 83). The conclusion would then seem unavoidable: The later book is doing wholesale borrowing from the earlier.
Or, to make things rather more specific: In 1985, Harvard University's Laurence H. Tribe, the most famous and widely cited constitutional law professor in the United States, signed his name to a book called God Save This Honorable Court that now appears--how shall we say it?--perhaps "uncomfortably reliant" on a 1974 book called Justices and Presidents by the University of Virginia's Henry J. Abraham.
POOR HARVARD seems to be going through a spate of such incidents. A national news cycle was generated in 2002 when THE WEEKLY STANDARD broke the story that Doris Kearns Goodwin--a member of Harvard's Board of Overseers and a former professor of government at the school--had done some serious copying for her 1987 book, The Fitzgeralds and the Kennedys, and then bought off one of the authors from whom she lifted her material.
Next, in a more complicated case, Harvard law school's Alan Dershowitz was accused of overusing a single secondary source for his 2003 book, The Case for Israel.
Finally, just a few weeks ago, on September 3, Charles J. Ogletree, Harvard's Jesse Climenko Professor of Law, admitted on the university's website that the assistants who'd actually prepared his new All Deliberate Speed: Reflections on the First Half-Century of Brown v. Board of Education lifted six consecutive paragraphs from a 2001 book by Yale's Jack M. Balkin.
ODDLY ENOUGH, Laurence Tribe plays a role in two of these stories. (And peripherally touches the third, if one counts the thanks he offers Dershowitz, his "friend and colleague," in the preface to God Save This Honorable Court.)
When the Goodwin incident prompted Harvard's undergraduate newspaper, the Crimson, to call for her scalp--"Goodwin's plagiarism of sentences, nearly verbatim, from source materials is inexcusable. . . . [S]he should recognize that her action is unbecoming an Overseer and resign her post immediately"--Tribe wrote a letter in the next issue expressing "great sadness" at how "mindlessly" the students' editorial had attacked her.
Goodwin "had not the slightest intention to deceive, to claim originality for thoughts that were unoriginal, or to appropriate another's deathless prose in hopes that she might be credited with a literary gift that belongs in truth to someone else," Tribe insisted. Oh, he admitted, she had "erred in following her own paraphrased handwritten notes without checking back in every last one of the 300 or so books she cited." But Goodwin's work was "documented with something like 3,500 footnotes," which according to Tribe proved both her commitment to scholarship and her "personal integrity."
Then, this year, Tribe initially appeared willing to excuse Charles Ogletree's plagiarism altogether, telling the Boston Globe: "It clearly represents the fact that because he so often says yes to the many people all over the country who ask for his help on all kinds of things, he has extended himself even farther than someone with all that energy can safely do."
Challenged about this apparent absolution, however, he later offered a rather different analysis. In an email posted on a blog about legal topics run by Lawrence R. Velvel, dean of the Massachusetts School of Law, Tribe wrote, "What I told the Boston Globe about the way in which [Ogletree] has overextended himself was not intended to be a complete explanation or justification." And there is more to say, he allowed: "The larger problem"--the "problem of writers, political office-seekers, judges and other high government officials passing off the work of others as their own"--is "a phenomenon of some significance" and worth exploring.
THAT SEEMED a little rich for one reader of THE WEEKLY STANDARD, a law professor who suggested we take a look at Tribe's own God Save This Honorable Court if we wanted to explore the "problem of writers . . . passing off the work of others as their own."
And so we did, and the result is . . . well, what? It's awkward to name what Laurence Tribe has done in God Save This Honorable Court. In his letter to the Crimson about Doris Kearns Goodwin, Tribe proudly called himself a "scholar who values his own integrity and reputation for meticulous attribution as much as anyone could."
But even Goodwin's discredited book, by Tribe's own account, contained "something like 3,500 footnotes" citing "300 or so" other works; God Save This Honorable Court, by unflattering contrast, contains no footnotes at all--nor any other sort of "meticulous attribution." Instead, at the end of God Save This Honorable Court, we find a two-page "Mini-Guide to the Background Literature," which lists Henry Abraham's Justices and Presidents as merely the twelfth of fifteen books (including two of Tribe's own previous works) that "an interested reader might wish to consult."
And against even this tiny hint of Tribe's use--the only appearance of Abraham in the book--one must set Tribe's preface, which explains the lack of footnotes by claiming: "much of what this book contains represents the culmination of more years of research and reflection about the Supreme Court and its role than I care to confess. Thus I cannot hope to trace here all the roots of the ideas that appear in these chapters--or to allocate credit or blame among the many who share indirect responsibility for the thoughts I have expressed."
GOD SAVE THIS HONORABLE COURT appeared in 1985 from Random House, selling well and receiving generally laudatory notices--and when the Wall Street Journal ran a less-praising review, Tribe took issue in a letter to the editor. A reviewer in the Los Angeles Times, Dennis J. Mahoney (author of this year's Politics and Progress, an interesting history of the academic discipline of political science in America), seemed to hint at the reliance on Abraham's book, "from which Tribe apparently borrowed most of his examples," but at the time, no one took particular notice.
No one, that is, but Henry J. Abraham himself. Abraham's Justices and Presidents: A Political History of Appointments to the Supreme Court first appeared from Oxford University Press in 1974. A second edition followed in 1985, a third in 1992, and Rowman & Littlefield brought out a fourth edition in 1999, retitled Justices, Presidents, and Senators.
(In his "Mini-Guide," Tribe refers to Abraham's second edition, published in 1985, the same year as Tribe's book. Did Tribe have the second edition while he was actually writing God Save This Honorable Court? His preface is dated January 1985, which makes it at least questionable. Thus, all references here are to Abraham's 1974 first edition instead. For those with later editions, Abraham's discussions appear roughly ten pages later in the second edition and about forty pages earlier in the oversized paperback of Rowman & Littlefield's "new and revised" edition.)
CALLING HENRY ABRAHAM a venerable historian of the courts hardly does justice to his stature. Now retired as an emeritus professor of government at the University of Virginia, the eighty-three-year-old scholar is the author of such standard works as 1962's The Judicial Process: An Introductory Analysis of the Courts of the United States, England, and France, 1965's The Judiciary: The Supreme Court in the Governmental Process, and 1967's Freedom and the Court: Civil Rights and Liberties in the United States.
Gary McDowell--a professor of political science at the University of Richmond who was Abraham's research assistant from 1977 to 1979--is thanked along for his help with Justices and Presidents in the 1985 edition. But when I asked him about the phenomenon of professors like Charles Ogletree pushing their assistants to write their manuscripts, he pointed to the hundreds of endnotes in Justices and Presidents and said that research assistants "never wrote passages" for the author: "One of the things that distinguishes Henry Abraham is that he's always done his own work."
Colgate's Stanley Brubaker, another former assistant thanked in the preface, laughs and says, "There's not a word in that book that didn't come from Henry's pen."
Abraham himself understands the lure. "The temptation of busy people, big deals, to turn the material over to assistants is very strong," he told me when we spoke last week. But the "annoying" practice must be stopped, he said--partly because the assistants lack the judgment that the professor is supposed to have, but mostly because it's wrong: unscholarly and unprofessional.
Discussing the dependence of God Save This Honorable Court on Justices and Presidents, Abraham is less than forgiving. "I was aware of what Tribe was doing when I first read his book," he said. "But I chose not to do anything at the time. I've never confronted him--and I was wrong in not following it up. I should have done something about it." Tribe's work probably derived from "a combination of being lazy and making a little money. I'm sure his book sold better than mine," Abraham added. But "he's a big mahatma and thinks he can get away with this sort of thing."
INDEED, the now over sixty-year-old Tribe is the big mahatma of American law as well as the great legal champion of the Democratic party. He's argued thirty-six cases before the Supreme Court, an astonishing number, and they include such landmark cases as the 2000 Bush v. Gore. He just represented the losing side before the Florida Supreme Court in John Kerry's effort to keep Ralph Nader off the ballot. He's produced the bestselling textbook American Constitutional Law, now in its third edition. He's written such books as the 1985 Constitutional Choices and the 1991 Abortion: The Clash of Absolutes. In addition to holding his chair at the law school, Tribe was recently named one of Harvard's rare "University Professors," replacing Archibald Cox, who died this spring.
From providing the talking points with which Senator Edward Kennedy went after William Rehnquist when he was nominated to be chief justice in 1986 to being named counsel for the team on call should John Kerry need lawyers to represent him during a recount this year, Tribe has clearly been a dominant figure for some while.
He was the big mahatma back in 1985, for that matter. The preface to God Save This Honorable Court thanks the powerful Democratic campaign specialist Bob Shrum, "my good friend," for suggesting that the book be written, and praises the assistance given by future Democratic party legal talents such as Ronald Klain. (Interestingly, Klain, who would go on to work in the White House as Vice President Gore's chief of staff, was then only a first-year student at Harvard law.)
SO WHY WOULD Tribe bother producing such a book--and introduce his young assistants to this kind of academic practice?
Part of the answer was the public purpose the book served. Thoughtful observers in the early 1980s could see what Tribe labeled the "greying of the Court," as the sitting members grew old together and potential replacements could be caught in battles between Republican presidents and Democratic senators.
In 2001 testimony before the Senate Judiciary Committee, Tribe himself described the 1985 God Save This Honorable Court as "defending an active role for the Senate in the appointment of Supreme Court Justices" and setting in place the argument that burst into public view two years later: "it wasn't until the 1987 resignation of Lewis Powell and the confirmation battle later that year over Robert Bork that the concrete stakes in this otherwise abstract controversy came to life for the great majority of the American public."
This judgment about the book seems nearly universal. "Tribe's arguments provided the intellectual blueprint for the anti-Bork forces," the New York Times explained in 1987. "And, as the hearings approached, he played the role of the nominee in mock question-and-answer sessions held in the living room of Senator Joseph R. Biden Jr., Democrat of Delaware, chairman of the Senate Judiciary Committee."
"Klain spent most of his time with Tribe working on Tribe's book God Save This Honorable Court," the Legal Times added in 1993. "The book, which was published in 1985, became a kind of intellectual road map for Democrats as they worked to defeat Robert Bork's Supreme Court nomination two years later. Many of Klain's friends and former colleagues say that he wrote large sections of the book, a claim that Tribe disputes."
BUT THERE SEEMS more to the production of Tribe's book than its public purpose. We enter here into what the novelist (and sometime WEEKLY STANDARD contributor) Thomas Mallon calls the "peculiar psychology" of famous people who want also to be authors.
Mallon has written, in addition to his novels, the 1989 Stolen Words: Forays into the Origins and Ravages of Plagiarism, declared "the definitive book on the subject" by the New York Times. And so I telephoned him to ask what he thought of the kind of systematic paraphrasing that God Save This Honorable Court uses.
But he seemed interestingly unwilling to subsume the practice entirely under the genus of plagiarism. Of Tribe's particular case, Mallon rightly said he didn't know the details. But even of the general form, he thought a distinction might need to be made in some cases. Still, Mallon concluded, "authors do not have a license to paraphrase forever." And pushed to decide, he offered this formulation as a good rule: "Constant paraphrasing without at least semi-regular attribution constitutes a form of plagiarism."
THE MODERN LANGUAGE ASSOCIATION'S Guidelines for Documentation proves a little sterner, condemning the practice as "plagiaphrasing" and likening it to the dishonesty of plagiarism: "Plagiarism (the unacknowledged borrowing of words or ideas) is a serious violation of academic honesty. So is 'plagiaphrasing': rewording a quote without putting the idea in your 'voice.'"
Mallon's gentler definition might conceivably let off Doris Kearns Goodwin. But not Tribe, whose noteless text provides nothing resembling "semi-regular attribution." So perhaps the MLA's ugly coinage "plagiaphrase" is the best term to describe what Tribe and his assistants did with God Save This Honorable Court.
The historical sections of the book typically consist of a long passage from Abraham crunched down by rephrasing and the elimination of detail--as one might expect when Abraham's 298 pages of material are made to provide the facts around which Tribe builds his own thesis in 143 pages of text. The repetition of "Taft publicly pronounced Pitney to be a 'weak member' of the Court to whom he could 'not assign cases'" (Tribe, p. 83; Abraham, p. 164) is straightforward copying. But more often, the reader will find the kind of plagiaphrasing that the MLA condemns.
SO, FOR EXAMPLE, on page 64, Tribe writes: "Although he rose to the Presidency in 1908 as Teddy Roosevelt's handpicked prot?g?, Taft was far more conservative and much less decisive than his political mentor."
Abraham rendered it as: "Although he was elected to and embarked upon the Presidency as Roosevelt's handpicked prot?g?, William Howard Taft's conception of the office differed dramatically from his predecessor's in style as well as substance"--and then, after two hundred words of detail, adds: "Taft was far more conservative than T.R., cautious and at home with the G.O.P.'s conservative leadership" (pp. 154-155).
The repetition of "handpicked prot?g?" and "far more conservative" make the source clear. Tribe has simply eliminated the intervening detail and lightly rephrased (improving it, in fact, by correcting Abraham's dangling modifier).
In the next paragraph, Tribe continues: "Taft made a record six Supreme Court appointments in his single term in office. He put five new men on the Court and elevated Justice White to the position of Chief Justice. Although he was not as dogmatic in his conservatism as the late nineteenth-century Presidents, Taft was determined to avoid nominees of the liberal stamp of Learned Hand, Louis Brandeis, or Benjamin Cardozo. Taft regarded these potential candidates as nothing less than 'destroyers of the Constitution'" (p. 65).
Abraham continues in his own next paragraph, "In his single term Taft appointed six Justices to the Court, including one Chief Justice--at the time more than any President since George Washington." And then, after perhaps seventy-five words of further detail, he concludes that Taft "wanted no 'liberals' of the stamp of Learned Hand, Louis Brandeis, or Benjamin Cardozo, potential candidates whom he regarded as 'destroyers of the Constitution'" (p. 155).
THE RELIANCE rolls and rolls along. Abraham has it that Caleb Cushing was "unquestionably highly qualified and possessed of a superb mind" (p. 121). Tribe inverts the clauses to say that Cushing was "possessed of a fine mind and undoubtedly highly qualified" (p. 88).
Abraham writes, "Hoover continued to demur. . . . Now, however, the powerful Chairman of the Senate Foreign Relations Committee, Republican William E. Borah of Idaho, whose support Hoover needed on other fronts, got into the act" (pp. 191-192). Tribe renders it: "When Hoover demurred, the Chairman of the Foreign Relations Committee, Senator William Borah--whose support Hoover needed on other matters--paid a visit to the White House" (p. 81).
ONE OF THE BEST PLACES to spot this kind of systematic cribbing is in quotations. A perfect match in ellipses and stripping almost always means the author hasn't gone to look at the original source but is merely copying.
Thus, Tribe tells us that "One periodical characterized [Tom] Clark as a 'second-rate political hack who has known what backs to slap and when,' and sarcastically concluded that it was appropriate that 'the least able of Attorneys General of the United States should, as a result of raw political favoritism, become the least able of the members of the Supreme Court'" (p. 83).
Abraham identified the author and magazine--Harold Ickes in the New Republic--and says the article contended that "Truman was under no obligation whatsoever to this 'second-rate political hack who has known what backs to slap and when'; concluding that 'perhaps it was in keeping that the least able of Attorneys General of the United States should, as a result of raw political favoritism, become the least able of the members of the Supreme Court'" (p. 229).
Similarly, the repetition of mistakes in quotations is good proof of reliance. Abraham notes, "In Mr. Justice Cardozo's words: 'Marshall gave to the constitution of the United States the impress of his own mind'" (p. 75), while Tribe says, "As Justice Benjamin Cardozo wrote more than a century later, 'Marshall gave to the Constitution of the United States the impress of his own mind'" (p. 56).
But Abraham had it slightly wrong. In his 1921 Nature of the Judicial Process, Cardozo wrote, "He gave to the constitution the impress of his own mind." And once Abraham has mistakenly replaced the pronoun, Tribe followed along.
OCCASIONALLY, Tribe's plagiaphrasing leads him into difficulties. On page 83 in God Save This Honorable Court, he writes, "President Chester Arthur pioneered the merit system in national government appointments and authored the Civil Service Reform Act of 1883. But he had a relapse in 1882 and nominated his mentor and former boss, arch political spoilsman Roscoe Conkling, to the Court."
On pages 128 and 129 of Justices and Presidents, Abraham notes, "In 1881 on Garfield's death, Chester A. Arthur of New York came to the Presidency with almost everyone predicting doom and failure: his selection as Vice President had been steeped in political hacksmanship and spoilsmanship, nurtured by the nether Roscoe Conkling wing of New York's Republican party."
Abraham adds a long sentence of examples of Arthur's participation in corrupt politics, then continues, "Yet in what was one of the most dramatic character reversals in the country's history, President Arthur not only turned his back on his spoilsmen-cronies but authored the great Pendleton Civil Service Reform Act of 1883." After nearly a page of discussion about Arthur's good behavior as president, Justices and Presidents concludes, "But to the consternation of most observers, Arthur had a 'relapse' [in 1882] and offered the spot to his one-time political mentor and boss, Senator Roscoe Conkling."
Without Abraham's examples of bad behavior before and good behavior after, Tribe's noun "relapse" doesn't make much sense--unless you realize that it's actually Abraham's word and Tribe merely forgot to change it.
MEANWHILE, Abraham claims that under Cleveland and Harrison the Supreme Court became "a veritable bastion of economic laissez-faire" (p. 133), and Tribe has the Court become "the last bastion of laissez-faire capitalism" (p. 64).
Abraham explains that Harrison "was content to let the Republican party hierarchy dominate the affairs of state during his four years in office" as "an economic conservative" (p. 137), while Tribe thinks Harrison was "devoted to large business interests and willing to allow the party hierarchy to run his administration" (p. 63).
Abraham: "Before he was finally confirmed six weeks later by a vote of 46-9, Bradley came under heavy fire from Eastern 'hard money' interests who quite correctly regarded him as dedicated to a 'soft money' economic philosophy" (p. 119). Tribe: "Grant nominee Joseph Bradley's dedication to 'soft money' or greenbacks came under fire from Eastern 'hard currency' business interests before Bradley was confirmed in 1870" (p. 89).
Abraham: "Andrew Jackson's Democratic supporters in the Senate were not about to award the Supreme Court plum to a Clay Whig, and by a vote of 23:17 'postponed' the nomination in February 1[8]29, thus consigning it to oblivion" (p. 85). Tribe: "Crittenden's nomination, despite his alumnus status, was postponed--and thereby consigned to oblivion--in February of 1829, a few weeks before Andrew Jackson's inauguration" (p. 86).
Abraham: Cleveland was an "economic conservative of such intensity that Wilson had cause, if only half jokingly, to regard himself as the first President of the Democratic party since 1860" (p. 130). Tribe: Cleveland "was such a dogmatic economic conservative that President Wilson regarded himself as the first real Democrat to occupy the White House since 1860" (p. 63).
THE EXAMPLES go on and on, too numerous to count. Laurence Tribe is in some ways a better writer than Henry J. Abraham. God Save This Honorable Court snaps along as popular prose in a way that Justices and Presidents doesn't--which is why the mainstream Random House published Tribe and the scholarly arm of Oxford University Press published Abraham. But how exactly does that give the popularizing Tribe and his assistants the right to plunder a scholar like Abraham?
In fact, it's worse than the typical example of a popularizing author's reliance on other people's scholarship, for Laurence Tribe is supposed to be a scholar himself. A phone call to Tribe's Harvard office has not yet been returned. But his credentials are well known. He's the Tyler Professor of Constitutional Law and a University Professor at Harvard. If these aren't scholars' posts, what are? He's written over a hundred books and articles, according to a blurb on the Harvard website, and "helped draft the Constitutions for South Africa, Russia, the Czech Republic, and the Marshall Islands." His American Constitutional Law is "the legal text most frequently cited in the second half of the 20th century," Harvard declares--and quotes the Northwestern Law Review, which gushed: "Never before in American history has an individual simultaneously achieved Tribe's preeminence both as a practitioner and as a scholar of constitutional law."
IN OTHER WORDS, he didn't have to do this. He is a self-described "scholar who values his own integrity and reputation for meticulous attribution as much as anyone could." But the historians Stephen Ambrose and Doris Kearns Goodwin did much the same thing and were pilloried mercilessly.
So what shall we say of Laurence H. Tribe when he does it--without the footnotes that he so condescendingly told the Harvard undergraduates exonerated Goodwin? If she deserves excuse because she "had not the slightest intention to deceive, to claim originality for thoughts that were unoriginal, or to appropriate another's deathless prose in hopes that she might be credited with a literary gift that belongs in truth to someone else," what excuse is deserved by Professor Tribe?
Perhaps the explanation for the whole thing is simply vanity, Tom Mallon's "peculiar psychology" by which the famous need constant reaffirmation of their fame. Or perhaps it's merely what Henry J. Abraham supposes: "He's a big mahatma and thinks he can get away with this sort of thing."
See Sidebars
Joseph Bottum is Books & Arts editor of The Weekly Standard.
? Copyright 2004, News Corporation, Weekly Standard, All Rights Reserved.

Posted by maximpost at 2:16 AM EDT
Permalink
Tuesday, 21 September 2004



>> IRAQ

Iraq's Electoral System - A Misguided Strategy
By Michael Rubin
Posted: Monday, September 13, 2004
ARTICLES
Arab Reform Bulletin
Publication Date: September 1, 2004
With the conclusion of the Iraqi National Conference last month, the next milestone for Iraqi democracy will be the January 2005 elections for a 275-member Parliament. Already, the electoral system chosen for Iraq could dampen the prospects for a representative and democratic vote. On June 15, 2004, in response to a recommendation by Carina Perelli, director of the UN's Electoral Assistance Division, Coalition Provisional Authority administrator L. Paul Bremer decreed that Iraq would be a single electoral constituency, with seats allocated through proportional representation (PR) based on national lists. Perelli's decision to avoid multiple districts was colored by technical considerations. Treating all of Iraq as one district bypasses questions of internal boundaries and simplifies ballots. The entire nation would need only one ballot, rather than separate ones in each district.
Such a system is bad for Iraq. Voting is only one aspect of democracy; another is accountability. Under a PR system, parliamentarians are not tied to a specific district, but rather to a party list. Instead of being responsible to a town's voters, representatives will be loyal to party leaders. The pitfalls of such a system have led Poles to seek a constitutional amendment to replace PR with districts. While more than ninety countries use some form of PR, its application to single national districts is seldom without complication. Many Israelis complain that single-district PR allows radical small parties to hold their political system hostage. In Germany's Weimar Republic, single-district PR helped bring the Nazis to power.
In Iraq, PR will breed radicalism. It is easier to forbid women from taking certain jobs, for example, if a politician need not answer to women in his district. If elections are based on 275 different districts, then each district would have only 87,000 people. Representatives would be closer to the people. Districts already exist, although Iraqis are keen to reverse Baathist gerrymandering. Even in disputed areas like Kirkuk, Iraqis say they can reach consensus to put Kurdish, Arab, and Turkoman neighborhoods into different districts.
Failure to base elections on districts may mean that some areas have no representation. This could breed violence. Residents of Basra and Mosul accepted the former Iraqi Governing Council (IGC), for example, because IGC members hailed from their towns. Since Fallujah and Sadr City had no such political outlet, they more quickly turned to violence. Under the UN plan, if local candidates are not listed high enough on the party slate, whole towns may have no representation. Iraqis recognize the importance of geographical representation. It was geography, not personality, that led the Iraqi Governing Council to recommend Ghazi Al Yawar, a tribal leader from Mosul, over Adnan Pachachi, a former foreign minister, as its president. Any political body that did not include Iraq's second largest city had little chance of success.
While Perelli has said that a single national district would allow geographically "broken" communities to vote together, it is simplistic to assume that all religious or ethnic groups want to vote as a bloc. Such a system sets Iraq down the slippery slope toward Lebanese-style communalism. Multiple districts would still represent Iraq's diversity. Fallujah would elect Sunnis, and Najaf, Shiites. The real difference would be in protection of religious minorities. With local districts, Chaldeans would win seats in Al Qosh and Yezidis in Sinjar even if they chose not to run on a religious platform. Under a national district system, the risk of disenfranchisement would be greater. Because religious minorities divide themselves politically, they may not gain enough votes nationally.
The UN plan will also invite corruption. It is easier for outsiders to buy a party list than to channel money to 275 different candidates. When constituents know their candidates, it is harder to hide outside money.
Some specialists have argued for replicating in Iraq of what worked in Cambodia, East Timor, and Nigeria. But it is a mistake to treat Iraq as analogous. Iraqi history suggests that a system privileging party lists over independent candidates will be counterproductive. Older Iraqis blame political parties for inciting riots in the 1950s and 1960s. The younger generation associates organized politics with the abusive Baath Party. In Iraqi Kurdistan, many students say that corruption revolves around the party structure. Some polls suggest that only 3 percent of Iraqis have faith in parties. While the UN plan allows independents to run in theory, Iraqis saw how party machination and backroom deals marginalized independents at the Iraqi National Conference.
The Iraqi election commission--and not outsiders--should decide Iraq's election system. The UN choice is not the only option. After all, countries like Australia and Jordan combine multiple districts with proportional representation and bring representatives closer to the people. There is still time to listen to Iraqis.
Michael Rubin, a resident scholar at the American Enterprise Institute and editor of The Middle East Quarterly, spent seventeen months in Iraq between 2000 and 2004.
Source Notes: This article appeared in the September 2004 issue of the Arab Reform Bulletin
AEI Print Index No. 17318


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Teach Iraq to Fish
Learning to cooperate is the key to reconstruction.
BY BRENDAN MINITER
Tuesday, September 21, 2004 12:01 a.m. EDT
John Kerry has decided to make Iraq a major focus of his campaign, and today President Bush will speak to the United Nations on Iraq and the larger war on terror. But don't expect to hear too much detail on what Iraq needs until after the election. That's because one thing essential for Iraq's progress is something that doesn't fit into a sound bite very well: for its people to see the benefits of mutual cooperation. To this end Lt. Gen. Carl A. Strock, head of the U.S. Army Corps of Engineers, dropped by The Wall Street Journal's offices recently and told us about one example that has played out with disastrous results in Iraq.
During Saddam Hussein's reign, not surprisingly, Baghdad and its No. 1 resident had priority when it came to basic services. Baghdad has no power generators to speak of, so generators in outlying cities had to feed the capital, often at the expense of their local residents.
After Saddam fell, many power engineers and local politicians apparently decided they'd opt out of the national power grid. Gen. Strock thinks that more than a few attacks on power lines have been deliberate attempts to isolate cities that generate their own power from the rest of the country; residents there no longer want to send power off to Baghdad while the lights in their own homes flicker and go out.
Like the blackout that struck the American Northeast and Midwest last year, unplugging a city from the national grid results in systemwide power failures. It doesn't matter that the total amount of electric power in Iraq is now exceeding prewar levels, or that it is much more equitably distributed. Thus electricity is a metaphor for the larger problem of Iraqi reconstruction: If Iraqis don't come to believe that working together is in their own self interest, then the country may indeed plunge into chaos.
It is in this light that we should assess "Progress or Peril? Measuring Iraq's Reconstruction," a largely critical recent report from the Center for Strategic and International Studies. The study did not address the question of mutual cooperation directly, but an underlying theme is that Americans cannot simply "rebuild" Iraq and instead must make it possible for Iraqis to come together to solve their own problems. Instead of thinking and defining success in terms of "nation building," the study recommends thinking in terms of "nation jumpstarting"--getting Iraq to the point where enough people have the skills necessary to crank up functional economic, social and political institutions.
The study, based partly on interviews with hundreds of Iraqis, finds five areas in which progress is critical: security, participation in government, economic opportunity, services (electricity, sewage, etc.) and "social well-being" (access to education, healthcare etc.). "Iraqi optimism and patience have somehow endured," the study found, but they "must be harnessed because they could easily be fleeting, particularly if the Iraqi government is no more successful than the CPA [Coalition Provisional Authority] was in righting the course in Iraq."
American forces can build schools, hospitals, sewage-treatment plants and power stations, but ultimately Iraqis must run them. Iraqis need jobs, and they need elections if they are going to feel they have a stake in their country's progress. Security is the most obvious area where international help is needed, but even here there must be more than just an "Iraqi face" put on the effort. The study finds that what Iraqis want is for their own security forces "to play a leading role" and that American officials underestimated the amount of nationalism in the country. An American-led coalition removed Saddam, but Iraqis want Iraqis to come together to defeat the insurgents.
None of this will come as a disappointment to American soldiers on the ground. The Corps of Engineers hires local contractors to complete many of its projects, and often there are only a few American engineers on the ground, with additional expertise available via satellite conferencing. Indeed, Gen. Strock relayed a story of importing equipment to rebuild and run a power-generating turbine in Iraq and then leaving it there for the now trained Iraqi workers to use in rebuilding another turbine nearby--proving there is power in giving Iraqis the tools they need instead of doing everything for them.
Mr. Miniter is assistant editor of OpinionJournal.com. His column appears Tuesdays.




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Flash flood of guns left Iraqis armed and dangerous
SPECIAL TO WORLD TRIBUNE.COM
Monday, September 13, 2004
LONDON -- The Small Arms Survey said millions of firearms pillaged from the military and security forces of the Saddam Hussein regime have flooded Iraq over the last year.
The survey said the collapse of the Saddam regime precipitated one of the largest and fastest transfers of light weapons ever recorded.
The survey said at least one in every three Iraqis possesses a firearm. In all, about eight million firearms are in the hands of Iraqis, with the actual number believed to be considerably higher, Middle East Newsline reported.
Another threat raised by the survey comes from what the institute termed the proliferation of man-portable surface-to-air missile launchers.
Insurgency groups have used such weapons in efforts to knock out airliners, such as the firing of an SA-7 missile toward an Israeli passenger jet over Mombasa, Kenya in December 2002.
"Iraq now poses a regional proliferation risk," Keith Krause, the survey's program director said. "That's going to be with us for years to come," Krause said. "The consequences of the great Iraqi small arms abandonment may endanger stability in much of the Middle East for years to come," the survey said.
The annual survey, coordinated at the Graduate Institute of International Studies in Geneva and financed by Western governments, said the pool of such weapons could fuel instability throughout the Middle East.
The survey cited the dramatic rise of shooting deaths in Baghdad in 2003.
Finland, however, has the highest ratio of firearms per person.
"We do not know what proportion of these weapons are military style."
Copyright ? 2004 East West Services, Inc.

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The Volcker Oil-for-Food Commission: Is It Credible?
by Nile Gardiner, Ph.D., and James Phillips
WebMemo #569
September 20, 2004
It has been almost six months since United Nations Secretary-General Kofi Annan announced the appointment of the U.N.'s commission of inquiry, headed by Paul Volcker, into the Oil-for-Food scandal.[1] So far, few details have emerged regarding the Commission's modus operandi, its staff, or its overall effectiveness. The Commission's operations are shrouded in secrecy, with little transparency or external oversight. For a commission designed to unearth corruption and malpractice on a huge scale, it is strikingly opaque. Its spartan official website contains little information of value, not even a mailing address.[2]
The Volcker Commission is likely to issue its report in a year's time (though no firm deadline has been set). Its investigation could cost $30 million in all.[3] The Commission bears all the hallmarks of a toothless paper tiger, with no subpoena power, and is clearly open to U.N. manipulation. It bears no enforcement authority (such as contempt) to compel compliance with its requests for information and has no authority to discipline or punish any wrongdoing it discovers.[4]
Who Is Staffing the Commission?
The "Independent Inquiry Committee into the U.N. Oil-for-Food Program," as it is officially termed, is top-heavy with distinguished luminaries but short on detail regarding its actual workforce.
Former Federal Reserve Chairman Paul Volcker heads a three-person committee, which includes South African judge Richard Goldstone and Mark Pieth, a professor from the University of Basel in Switzerland. So far, the names of ten senior staff have been released, including Reid Morden, former Director of the Canadian Security Intelligence Service, and Swiss magistrate Laurent Kasper-Ansermet.[5]
However, no details have thus far been released regarding the remaining staff (currently around 40 in number, and likely to rise further) that will actually be doing the investigating and handling the huge volumes of documents. The key questions remain: How many U.N. staff and former staff are involved with the Commission? What assurances are there that U.N. officials implicated in the Oil-for-Food scandal will not interfere with or unduly influence this supposedly independent investigation? A truly independent inquiry into U.N. corruption should not be staffed by U.N. employees, former U.N. employees, or those with any significant ties to the U.N.
It is therefore surprising to discover that the official spokesman for the Commission, Anna Di Lellio, is a former United Nations official. Moreover, Ms. Di Lellio, who is Director of Communications for Paul Volcker, has publicly expressed contempt for the U.S. president. In an interview with the London newspaper The Guardian on the first anniversary of the September 11 terrorist attacks, Ms. Di Lellio launched into a vicious tirade against the U.S. and Italian governments, implicitly comparing President George W. Bush and key U.S. ally Prime Minister Silvio Berlusconi to Osama bin Laden:
What I do feel is a sense of powerlessness against the changes which are potentially lethal for our civilization. But I see the major threats coming from ourselves, rather than the east. I find deeply unsettling both the ascendance of George Bush and his puppeteers to the U.S. government, and the mix of self-serving hypocrisy and incompetence prevailing in European governments.
I don't like it that the two nations whose citizenship I hold, Italy and the U.S., have leased their institutions to a couple of families. With defenders like W and Berlusconi, largely unchecked by a sycophantic media, who needs Bin Laden to destroy culture, personal freedom, respect for other human beings, integrity, and the rule of law--all the things that make our lives worthwhile?[6]
Such extreme opinions do not sit well with the Volcker Commission's claim to impartiality and will impede the establishment of a constructive relationship between the Commission, the U.S. Congress, and the executive branch of the United States.
Anna Di Lellio's appointment brings into question the judgment of the Volcker Commission in hiring its staff. It casts a shadow of doubt over the Commission's ability to provide what Mr. Volcker refers to as "the truly definitive report on the administration of the Oil-for-Food program." Di Lellio's appointment raises serious questions regarding the role of current and former U.N. officials in an inquiry that is purported to be completely free of influence from the U.N. It also strongly suggests that the U.N. is, in effect, controlling the message being communicated by the Volcker Commission to the world media.
Volcker's Refusal to Cooperate with Congressional and Federal Investigations
In meetings on Capitol Hill on July 13, Paul Volcker "rejected requests from members of Congress for access to review documents and to interview United Nations officials being scrutinized by his panel," reports the New York Times.[7] Congressional sources have confirmed that the Volcker Commission refuses to grant access to internal reports on the Oil-for-Food program produced by the U.N.'s Office of Internal Oversight Services and is unwilling to share documentation that it holds in Baghdad. It also refuses to guarantee that it will release documents relating to the Oil-for-Food program even after it has filed its final report. This hostile approach seriously undermines the credibility of the Independent Inquiry Committee.
Four congressional entities are investigating the U.N.'s administration of the Oil-for-Food program: the Senate Subcommittee on Government Affairs (chaired by Sen. Norm Coleman), the House Subcommittee on Government Reform (chaired by Rep. Christopher Shays), the House International Relations Committee (chaired by Rep. Henry Hyde), and the House Committee on Energy and Commerce (chaired by Rep. Joe Barton). In addition, there are three federal investigations underway: by the General Accounting Office (GAO), the Department of Justice, and the U.S. Treasury.[8] The Volcker Commission has so far refused to cooperate significantly with any of these investigations.
What Congress Should Demand
Congress has a vital role to play in forcing the Volcker Commission to operate in an open, transparent manner. Moreover, it is likely that Congressional and federal investigations will be far more effective ultimately than the U.N.'s own commission of inquiry. Congressional leaders and the Bush Administration should demand:
Full access to all U.N. documents relating to Oil for Food.
There should be no monopoly over documentation held by the U.N. The U.N. should also provide a full list of documents currently in its possession that relate to Oil for Food.
Freedom to interview U.N. officials implicated in the scandal.
Federal and Congressional investigators should be able to question U.N. officials under investigation by the Volcker Commission.
A complete list of names of all staff working on the Volcker Commission.
The Volcker Commission should be completely independent of the U.N., and there should be no conflicts of interest involving its staff.
External oversight of the workings of the Volcker Commission.
The Commission should be open to public scrutiny and should include third-party representatives seconded from bodies such as the FBI and Interpol.
Monthly progress reports from the Volcker Commission to Security Council members.
All members of the U.N. Security Council should be furnished with regular updates on the investigation.
A firm date for publication of the Volcker Report.
The final date of publication must not be open to political manipulation by the U.N. in an attempt to limit potential damage.
Conclusion
The Volcker Commission's refusal to share documentation with congressional investigators demonstrates not only breathtaking arrogance but also complete disrespect for Congress and the American public that helps fund the Commission through the United Nations. If it is to be treated seriously and respected as something other than an elaborate but costly whitewash exercise, the Commission will need to implement major changes, both in its operations and in its approach. Above all, transparency and accountability will be needed if the Independent Commission is to avoid becoming yet another example of mutual back scratching at the U.N.
Nile Gardiner, Ph.D., is Fellow in Anglo-American Security Policy, and James A. Phillips is Research Fellow in Middle Eastern Affairs, at The Heritage Foundation.
[1] For background on the Oil for Food issue, see Nile Gardiner Ph.D., James A. Phillips, and James Dean, "The Oil for Food Scandal: Next Steps for Congress," Heritage Foundation Backgrounder no. 1772, June 30, 2004, at http://www.heritage.org/Research/
InternationalOrganizations/bg1772.cfm.
[2]http://www.iic-offp.org/index.html
[3] Susan Sachs and Judith Miller, "Under Eye of UN, Billions for Hussein in Oil for Food Plan," The New York Times, August 13, 2004.
[4] The authors are grateful to Paul Rosenzweig, Senior Legal Research Fellow at the Heritage Foundation, for his observations on the legal powers of the Commission.
[5] Paul A. Volcker, "A Road Map for our Inquiry," The Wall Street Journal, July 7, 2004.
[6] The Guardian, "Interview with Anna Di Lellio," September 11, 2002, at http://www.guardian.co.uk/september11
/oneyearon/interview/0,12385,787426,00.html.
[7] Judith Miller, "UN and Congress in Dispute Over Iraq Oil for Food Inquiries," The New York Times, July 28, 2004.
[8] For further detail, see Thomas Caton, "Investigators Crawl Over Iraq's Oil Billions," Financial Times, July 6, 2004.
? 1995 - 2004 The Heritage Foundation
All Rights Reserved.

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The Oil-for-Food Scandal: Next Steps for Congress
by Nile Gardiner, Ph.D., James Phillips, and James Dean
Backgrounder #1772
June 30, 2004
The Oil-for-Food fraud is potentially the biggest scandal in the history of the United Nations and one of the greatest financial scandals of modern times.1 Set up in the mid-1990s as a means of providing humanitarian aid to the Iraqi people, the U.N.-run Oil-for-Food program was subverted and manipulated by Saddam Hussein's regime--allegedly with the complicity of U.N. officials--to help prop up the Iraqi dictator.
Saddam's dictatorship was able to siphon off an estimated $10 billion from the program through oil smuggling and systematic thievery, by demanding illegal payments from companies buying Iraqi oil, and through kickbacks from those selling goods to Iraq--all under the noses of U.N. bureaucrats.
Members of the U.N. staff that administered the program have been accused of gross incompetence, mismanagement, and possible complicity with the Iraqi regime. Benon Sevan, former executive director of the Oil-for-Food program, appeared on an Iraqi Oil Ministry list of 270 individuals, political entities, and companies from across the world that allegedly received oil vouchers as bribes from Saddam Hussein's regime.2
The U.S. General Accounting Office estimates that the Saddam Hussein regime generated $10.1 billion in illegal revenues by exploiting the Oil-for-Food program. This figure includes $5.7 billion from oil smuggling and $4.4 billion in "illicit surcharges on oil sales and after-sales charges on suppliers."3
Under intense pressure from Congress, the United Nations established its own "independent" commission of inquiry into the U.N.'s handling of the Oil-for-Food program, headed by former U.S. Federal Reserve Chairman Paul Volcker, South African judge Richard Goldstone, and Swiss lawyer Mark Pieth. The U.N. inquiry bears all the hallmarks of an elaborate paper tiger. The commission lacks subpoena power and cannot force the cooperation of U.N. member states. It has also been dogged by allegations of interference by U.N. officials, and serious doubts exist as to whether the inquiry will deliver substantial results.
The Role of Congress
Congress is playing a vital role in ensuring that the Oil-for-Food fraud is thoroughly investigated and that U.N. officials who are guilty of criminal behavior or illicit profiteering are brought to justice. The U.N. decision to set up a commission of inquiry is a direct result of pressure from Congress.
Secretary General Kofi Annan has made some incidental concessions in response to moves by Congress but has yet to demonstrate a full commitment to get to the bottom of the issue. Congress should therefore maintain pressure to:
Strengthen the position of Paul Volcker and his commission of inquiry.
Ensure that the Iraqi interim government and congressional investigators are able to conduct an effective and exhaustive investigation into Oil-for-Food documents in Baghdad.
Push the Bush Administration to ensure that the Oil-for-Food scandal is thoroughly investigated.
Keep the international spotlight on Oil for Food, encouraging foreign governments to launch their own investigations into misdeeds that may involve their nationals.
Increase the likelihood of serious reform at the U.N., including significant safeguards to prevent repetition of its failures.
Limit the role of the United Nations in shaping the future of Iraq.
Withhold U.S. Funds from the U.N.
The Oil-for-Food fraud has become an issue of well-founded, serious concern on Capitol Hill. Three congressional committees--the Senate Foreign Relations Committee, the House International Relations Committee, and the House Subcommittee on National Security--have already held hearings into the Oil-for-Food scandal.
The most effective way to ensure that the United Nations fully cooperates with its own commission of inquiry, and with investigators in Washington and Baghdad, is to threaten to reduce U.S. funding for the U.N., specifically the United States' assessed contribution. In particular, the U.S. should target funds going to the U.N. Secretariat, the political arm of the U.N. system, that had responsibility for overseeing the Oil-for-Food program.
Congress should threaten to withhold a portion of U.S. funds for the U.N. unless it is completely satisfied that the U.N. is fully cooperating with the various Oil-for-Food inquiries and is undertaking effective measures to reform itself. Senator John Ensign (R-NV) and Representative Jeff Flake (R-AZ) have introduced bills (S. 2389 and H.R. 4284, respectively) that would move in the right direction and enjoy bipartisan support.4
Adoption of Senate Amendment 3440 (sponsored by Senator Ensign) to the National Defense Authorization Act for FY 2005 (S. 2400) was another important step. Specifically, Amendment 3440:
Requires key departments within the Administration to take steps to ensure that all documents needed to conduct investigations are collected and safely secured;
Requires the Department of Defense to secure documents in the hands of the (now-dissolved) Coalition Provisional Authority (CPA);
Requires heads of U.S. executive agencies to provide prompt access to documents and information to congressional committees with relevant jurisdiction;
Directs the Secretary of State to use American power at the U.N. to provide the U.S. with audits and vital documents related to the Oil-for-Food program; and
Requires the Comptroller General to review U.S. oversight of the Oil-for-Food program and underscores that the Comptroller General should have full and complete access to U.N. documents and financial data.
Senate Amendment 3440 was adopted unanimously following bipartisan consultations and modifications. It is critical that the conference committee, which will reconcile the House and Senate versions of the National Defense Authorization Act, include it in the conference report that will come back to the House and Senate for final approval.
Senator Ensign, Representative Flake, and the other Members of Congress who have contributed to the effort to get to the bottom of the U.N. Oil-for-Food scandal should be commended for their efforts to date and encouraged to continue to apply pressure on both the U.N. and the Administration.
In light of the congressional hearings that have already been held concerning Oil for Food, the Senate Foreign Relations Committee and the House International Relations Committee should report the bills for debate and action by the full Senate and House. In addition, similar language should be included in the Senate and House annual appropriations legislation that provides funding for the United Nations.
Oil for Food and the U.N. Role in Iraq
The U.N.'s dismal and allegedly corrupt handling of the Oil-for-Food program should lay to rest any notion that the organization can be entrusted with shaping the future of the Iraqi people. Many Iraqis regard the U.N. with suspicion and as lacking both legitimacy and credibility. Iraqis have bitter memories of Secretary General Annan's February 1998 statement to reporters: "Can I trust Saddam Hussein? I think I can do business with him."
The Bush Administration's decision to give the U.N. a key role in picking the Iraqi interim government should not be a precedent for the post-June 28 era. While agreeing to a technical role for the U.N. in assisting the electoral process in Iraq, the United States should oppose a major administrative or military role for the U.N. in the country. The U.N. should not be given any say over U.S. military operations in Iraq, nor should it be allowed to turn Iraq into a glorified U.N. protectorate on the model of Kosovo.
Further Areas for Congressional Investigation
There are several key areas that Congress should investigate:
The lack of power given to the Volcker Commission of Inquiry,
Leaked U.N. documents and Kofi Annan's role,
The Benon Sevan letters,
The role of the Coalition Provisional Authority,
Security Council debates over the removal of Saddam Hussein,
Oil for Food and terrorism, and
United Nations reform.
The U.N. Commission of Inquiry
The U.N. commission of inquiry is already underway, although it is not required to report by a set deadline. There are serious doubts emerging as to whether the commission can do its job effectively. It is operating amid a cloud of secrecy and confusion.
Congress should be seriously concerned about the commission's lack of subpoena power. In addition, it is unclear whether the U.N. is setting aside sufficient funds for the investigation and who will be staffing it. The commission's independence is also in doubt because of questions about whether it will be open to interference from the U.N. Secretariat and Secretary General Annan. Finally, the lack of transparency in the commission's operation is disturbing.
Leaked U.N. Documents and Kofi Annan's Role
Evidence was recently leaked that the U.N. Office of Internal Oversight Services conducted a detailed audit of the U.N.'s administration of the Oil-for-Food program in 2003, before the liberation of Iraq.5 The report was damning in its conclusions and highly critical of the U.N.'s dealings with the Swiss company Cotecna Inspection SA, which had won a $4.8 million contract to oversee the operations of the Oil-for-Food program. Kofi Annan's son Kojo worked for the company in the mid-1990s and was a consultant to the company until shortly before it won the Oil-for-Food contract. Bizarrely, Cotecna was awarded another contract, worth $9.8 million, almost immediately after the report's publication.
The leaked report is reportedly just one of 55 internal U.N. audits of the Oil-for-Food program. Its existence suggests that Secretary General Annan would have known about the rampant structural problems within the program's administration. At the very least, the leaked report indirectly suggests gross negligence on the part of the U.N.'s top official.
Congress should demand the immediate release of all 55 internal reports and should investigate the extent to which Secretary General Annan deliberately ignored their findings. Congress should also investigate whether Annan's decision to hire Cotecna was influenced by his son's affiliation with the company.
The Benon Sevan Letters
There is also some evidence that Benon Sevan, the former director of the Oil-for-Food program, interfered with congressional investigations. Specifically, Sevan wrote letters on official U.N. stationery warning some of the companies implicated in the scandal that they must first seek U.N. approval before releasing documents to investigators.6
Congress should both demand a full accounting from the U.N. Secretariat of the Sevan letters and express its concern that Sevan may be seeking to block efforts by Congress to establish the truth.
The Former Coalition Provisional Authority
The recently dissolved Iraqi Governing Council (IGC) appointed its own investigation into the U.N.'s handling of the Oil-for-Food program, headed by Claude Hankes-Drielsma, a highly respected British businessman and political adviser, and the leading international accounting firm KPMG. However, the CPA refused to fund the IGC investigation and launched its own inquiry, using the Ernst & Young accounting firm. As a result, the Oil-for-Food investigations in Baghdad are in a state of confusion, wasting precious time and resources, and there are growing concerns that vital documents may be lost or destroyed.7
On his return to Washington, Congress should ask former Ambassador Paul Bremer to clarify his actions in impeding Oil-for-Food investigations in Baghdad. Specifically, Congress should ask why the CPA refused to fund the IGC investigation and then launched its own investigation. The resulting confusion may seriously harm efforts in Iraq to establish the truth regarding Saddam Hussein's abuse of the Oil-for-Food program.
Congressional investigators should also examine whether the United Nations or Lakhdar Brahimi, the U.N. envoy to Iraq, have unduly influenced the Oil-for-Food investigations in Baghdad.
Security Council Debates over the Removal of Saddam Hussein
The heated U.N. Security Council debates before the U.S.-led war to liberate Iraq cannot remain separated from the Oil-for-Food program and the fact that influential politicians, major companies, and political parties from key Security Council member countries may have benefited financially from the program.
The Al Mada list of 270 individuals, political entities, and businesses across the world that allegedly received oil vouchers from Saddam Hussein's regime included no fewer than 46 Russian and 11 French names. The Russian government alone allegedly received an astonishing $1.36 billion in oil vouchers.
The list of Russian entities accused of accepting bribes from Saddam goes to the heart of the Russian financial and political establishment and includes the Russian Foreign Ministry, the Russian Communist Party, Lukoil, Yukos, Gasprom, the Russian Orthodox Church, and the chief of the President's Bureau. The list of French names includes former Interior Minister Charles Pasqua.
The close ties between Russian and French politicians and the Iraqi regime may have been an important factor in influencing their governments' decision to oppose Hussein's removal from power. They also highlight the close triangular working relationships among Paris, Moscow, and Baghdad and the huge French and Russian financial interests in pre-liberation Iraq. Prior to the regime change in April 2003, French and Russian oil companies possessed oil contracts with the Saddam Hussein regime that covered roughly 40 percent of the country's oil wealth.8
Without a shred of evidence, European and domestic critics have frequently derided the Bush Administration's decision to go to war in Iraq as an "oil grab" driven by U.S. corporations such as Halliburton. They ignore the reality that the leading opponents of war at the U.N. Security Council--Russia and France--had vast oil interests in Iraq, protected by the Saddam Hussein regime. The Oil-for-Food program and its elaborate system of kickbacks and bribery was also a major source of revenue for many European politicians and business concerns, especially in Moscow.
Congressional hearings on the financial, political, and military links among Moscow, Paris, and Baghdad will help to shed light on the tempestuous Security Council debates that preceded the war with Iraq and on the motives of key Security Council members in opposing regime change in Baghdad. The full disclosure of the Russian and French roles in trying to prevent Saddam Hussein's removal from power will have major implications for the future of U.S.-Russian and U.S.-French relations and should result in a more informed assessment of the long-term viability of political, intelligence, and military cooperation with the two countries.
Hearings would also shed light on the extent of strategic cooperation between Paris and Moscow in the Security Council and the long-term threat that the emergence of a Franco-Russian-German axis at the United Nations could pose to U.S. interests.
Oil for Food and Terrorism
In addition to propping up Saddam's regime and buying influence abroad, some Oil-for-Food revenues may have been diverted to funding terrorism. At least two shadowy entities--Asat Trust and al-Taqwa, which have been linked to al-Qaeda, Hamas, and other Islamic extremist organizations--profited from the Oil-for-Food program.9 Asat Trust, a firm that the U.S. and the U.N. later designated as a financial collaborator of al-Qaeda, was the legal representative of the Galp International Trading Establishment, a Liechtenstein-based subsidiary of Portugal's major oil company and one of Iraq's trading partners under the Oil-for-Food program after 1997.
Al-Taqwa (awe of God) was a group of financial institutions set up in the 1980s by prominent members of the Muslim Brotherhood, an anti-Western Islamic organization founded in Egypt in 1928. According to a White House press release, al-Taqwa and its affiliates "raise, manage, invest, and distribute funds for al-Qaeda; provide terrorist supporters with internet service and secure telephone communications; and arrange for the shipment of weapons."10 A former FBI counterterrorism specialist also charges that al-Taqwa was used by the Palestinian terrorist group Hamas and several North African terrorist groups affiliated with al-Qaeda.11 According to a senior government official, "Al-Taqwa was the recipient of illicit funds from Iraq's Oil for Food program," and the money flowed "through al-Taqwa to al-Qaeda."12
Another reported recipient of Oil-for-Food largesse was Delta Services, a now-defunct subsidiary of Delta Oil, a Saudi oil company that had close relations with the Taliban regime in Afghanistan. Delta Oil was one of the prime movers pushing for the building of a pipeline from oil-rich Central Asia across Afghanistan to Pakistan. This scheme collapsed after al-Qaeda bombed two U.S. embassies in East Africa in August 1998, provoking an American cruise missile strike on al-Qaeda training camps in Afghanistan.
Another target of retaliation for the embassy bombings was the Al Shifa pharmaceutical plant in Khartoum, Sudan. Osama Bin Laden was suspected of owning at least part of the plant, although this has never been proven. However, according to Clinton Administration officials, the plant manager lived in a villa owned by bin Laden, and U.S. intelligence intercepted phone calls from the plant to the Iraqi official who ran Saddam Hussein's chemical weapons program. Before being destroyed, the Al Shifa plant also received a contract for $199,000 under the Oil-for-Food program.13
Although much remains unknown about the precise flow of money from the Oil-for-Food program, there is a disturbing pattern emerging that connects the U.N.-administered program to a number of entities that are known to support or are suspected of supporting terrorism.
United Nations Reform
A congressional investigation into the Oil-for-Food scandal should seek fundamental and lasting reform of the United Nations. No other issue has as much power to shape the future of the United Nations in such a positive way. The Oil-for-Food investigations should not be interpreted as a campaign to damage the reputation of the U.N., but as a concerted effort to ensure that the U.N. is made more accountable, transparent, and effective.
The Oil-for-Food scandal reinforces the need for the Security Council to impose a code of conduct on U.N. employees. The pervasive "anything goes" approach at the U.N. is unacceptable and should not be tolerated. A thorough external audit of the U.N. is needed. The U.N. must provide accountability, transparency, and value for money to the U.S. taxpayer.14
What the U.S. Should Do
To respond effectively to this growing scandal, the U.S. can and should pursue several courses of action. Specifically:
Conference Committee Action. The conference committee for the National Defense Authorization Act should ensure that the Ensign Amendment is included in the committee's conference report.
Volcker Commission of Inquiry. The Bush Administration and Congress should press the U.N. Security Council to give real teeth to its own commission of inquiry. As it currently stands, the Volcker commission lacks real power and credibility. The Bush Administration should press for a Security Council-appointed investigation, with subpoena power and a team of special investigators drawn from the FBI, the U.S. Department of Justice, and international bodies such as Interpol. The investigation should be completely independent of the United Nations and staffed with non-U.N. employees. Congress should continue to pressure the United Nations to cooperate fully with investigators in New York, Washington, and Baghdad and should call for Paul Volcker to give a firm date for the release of his report into Oil for Food.
Further Congressional Hearings. Further hearings are necessary to address growing allegations of U.N. interference with Oil-for-Food investigations and charges that the CPA impeded investigations in Baghdad. Hearings should also examine Kofi Annan's role in the scandal and how the Oil-for-Food program may have influenced Security Council debates over U.S. plans to liberate Iraq. Congress should also reassess the future U.N. role in Iraq in light of the U.N.'s administrative failure in the Oil-for-Food program.
U.S. Funding of the U.N. Future U.S. funding of the United Nations or U.N. specialized agencies should depend on substantial, not cosmetic, reform of the world body. Failure to prosecute U.N. officials implicated in wrongdoing should also result in reduced U.S. funding, particularly for the Secretariat, which had responsibility for overseeing the Oil-for-Food program. Withheld funds should be placed in an escrow account with the provision that they will be released only after firm evidence of major U.N. reform has emerged.
Securing Documents in Baghdad. The U.S. government should make every effort to ensure that key documents relating to Oil for Food in Baghdad and New York and around the world are preserved. In cooperation with the interim Iraqi government, copies of key documents should be sent to congressional investigators in Washington.
European and Arab Governments. The Bush Administration should urge European and Arab governments to launch their own probes of any citizens who are accused of accepting bribes from Saddam Hussein. British Prime Minister Tony Blair should be strongly encouraged to investigate the allegedly close relationship between former Labour MP George Galloway and Saddam Hussein. Similarly, the French government should be urged to investigate the allegations against politicians such as Charles Pasqua.
Kofi Annan. Overall responsibility for the U.N.'s management of Oil for Food lies with Secretary General Annan. If it is established that he ignored the damning findings of internal U.N. audits of the Oil-for-Food program, he should resign.
Prosecution of U.N. Officials in Iraqi Courts. Iraqi courts would be the appropriate venue for trying and sentencing individuals implicated in criminal wrongdoing by a Security Council-appointed investigation. The United States should press the Security Council to recommend waiving diplomatic immunity for U.N. employees implicated in crimes relating to the Oil-for-Food program. The U.S. should also encourage individual governments to extradite to Iraq anyone indicted for allegedly committing crimes relating to the Oil-for-Food program, to the same extent they would extradite citizens for any other serious crime.
U.N. Role in Iraq. The United Nations' failure to support removing Saddam Hussein from power, combined with its shameful record on Oil for Food, should exclude it from any leading role in crafting a democratic, free Iraq.
Conclusion
The abuse of the Oil-for-Food program was the result of a staggering management failure by the U.N. and raises troubling questions regarding the U.N.'s credibility and competence. Congress has played a crucial role in bringing the Oil-for-Food scandal to international attention by casting a bright spotlight on an issue the U.N. would prefer to forget. Congress needs to maintain relentless pressure on the U.N. to hold its own officials accountable for both their actions and their inactions.
The Bush Administration should play a bigger role in pressing for an effective, truly independent Security Council investigation. President George W. Bush should take the lead in condemning the abuse of the Oil-for-Food program and calling for U.N. officials and member states to cooperate fully with Security Council, congressional, and Iraqi investigations. The White House should make it clear that it fully supports congressional efforts to investigate the Oil-for-Food scandal and that effective reform of the United Nations is a priority issue for the United States.
Nile Gardiner, Ph.D., is Fellow in Anglo-American Security Policy and James Phillips is Research Fellow in Middle Eastern Studies in the Kathryn and Shelby Cullom Davis Institute for International Studies, and James Dean is Deputy Director of Government Relations, at The Heritage Foundation. The authors are grateful to Paul Rosenzweig, Senior Legal Research Fellow in the Center for Legal and Judicial Studies at The Heritage Foundation, for his advice and recommendations.
1. For further background, see Nile Gardiner, Ph.D., and James Phillips, "Investigate the United Nations Oil-for-Food Fraud," Heritage Foundation Backgrounder No. 1748, April 21, 2004, at new.heritage.org/Research/InternationalOrganizations/bg1748.cfm.
2. The list of names was originally published in January in the Arabic Iraqi newspaper Al Mada. For a translation, see Nimrod Raphaeli, "The Saddam Oil Vouchers Affair," Middle East Media Research Institute, February 20, 2004, at memri.org/bin/articles.cgi?Page=archives&Area=ia&ID=IA16404 (June 21, 2004).
3. Joseph A. Christoff and Davi M. D'Agostino, "Recovering Iraq's Assets: Preliminary Observations on U.S. Efforts and Challenges," testimony before the Subcommittee on Oversight and Investigations, Committee on Financial Services, U.S. House of Representatives, GAO-04-579T, March 18, 2004, at financialservices.house.gov/media/pdf/031804gao.pdf (June 21, 2004).
4. The bills call for a 10 percent reduction in the U.S. contribution to the United Nations unless the President certifies that the U.N. is fully cooperating with all investigations.
5. The report was leaked to Mineweb, an international publication focusing on mining finance and corporate news. See United Nations, Internal Audit Division, Office of Internal Oversight Services, "Management of the Contract for Provision of Independent Inspection Agents in Iraq," OIOS Audit No. AF2002/32/1, April 8, 2003, posted by Mineweb, at www.mineweb.net/download_files/sections/AuditOIOS_AF2002_23_1.pdf (June 21, 2004). For analysis of the U.N. report, see Tim Wood, "Leaked UN Audit Proves Oil for Food Shambles," Mineweb.net, May 19, 2004, at www.mineweb.net/sections/energy/oilshambles.htm (June 21, 2004), and Fox News, "UN Audit Found Early `Oil-for-Food' Problems," May 20, 2004, at www.foxnews.com/story/0,2933,120391,00.html (June 23, 2004).
6. For analysis of the Sevan letters, see Claudia Rosett, "`We Have Other Priorities': Why Won't the UN Answer Questions About Its Iraq Scandal?" The Wall Street Journal, May 5, 2004, and Editorial, "The Volcker Excuse," The Wall Street Journal, May 5, 2004.
7. See Claude Hankes-Drielsma, testimony before the Subcommittee on National Security, Emerging Threats, and International Relations, Committee on Government Reform, U.S. House of Representatives, April 21, 2004, at reform.house.gov/UploadedFiles/Oil-for-Food%20Hankes%20Drielsma%20Testimony.pdf (June 21, 2004). For further background on the CPA's role in slowing the Oil-for-Food investigations in Baghdad, see Robin Gedye, "Bremer Office `Hampering Oil for Food Corruption Inquiry,'" The Daily Telegraph, May 17, 2004, at www.telegraph.co.uk/news/main.jhtml?xml=/news/2004/05/17/woil17.xml&sSheet=/news/2004/05/17/ixnewstop.html (June 21, 2004); Claudia Rosett, "Cover-Up Culture: When Will the Real Oil for Food Investigations Begin?" National Review Online, May 27, 2004, at www.nationalreview.com/rosett/rosett200405262134.asp (June 21, 2004); and Editorial, "Bigfooted in Baghdad," The Wall Street Journal, May 19, 2004.
8. See Carrie Satterlee, "Facts on Who Benefits from Keeping Saddam Hussein in Power," Heritage Foundation WebMemo No. 217, February 28, 2003, at www.heritage.org/Research/MiddleEast/wm217.cfm.
9. See Marc Perelman, "Oil for Food Sales Seen as Iraq Tie to Al Qaeda," Forward, June 20, 2003, at www.forward.com/issues/2003/03.06.20/news2.html (June 21, 2004). See also Claudia Rosett, "Oil for Terror?" National Review Online, April 18, 2003, at www.nationalreview.com/comment/rosett200404182336.asp (June 21, 2004).
10. The White House, "Terrorist Financial Network Fact Sheet: Shutting Down the Terrorist Financial Network," November 7, 2001, at www.whitehouse.gov/news/releases/2001/11/20011107-6.html (June 21, 2004).
11. Matthew Levitt, "Combating Terrorist Financing: Where the War on Terrorism Intersects the Roadmap," Jerusalem Issue Brief, Vol. 3, No. 4 (August 2003), p. 3.
12. Scott Wheeler, "The Link Between Iraq and Al-Qaeda," Insight, October 14, 2003, at www.insightmag.com/global_user_elements/printpage.cfm?storyid=477622 (June 21, 2004).
13. Stephen Hayes, "The Clinton View of Iraqi-Al Qaeda Ties," The Weekly Standard, December 29, 2003.
14. For further discussion of United Nations reform, see Nile Gardiner, Ph.D., and Baker Spring, "Reform the United Nations," Heritage Foundation Backgrounder No. 1700, October 27, 2003, at new.heritage.org/Research/InternationalOrganizations/BG-1700.cfm.
? 1995 - 2004 The Heritage Foundation
All Rights Reserved.


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>> IRAN

UN group defers to Iran, rejects U.S. deadline
SPECIAL TO WORLD TRIBUNE.COM
Monday, September 20, 2004
LONDON - The International Atomic Energy Agency has rejected a U.S. effort to set a deadline for an end to Iran's uranium enrichment program.
Instead, the IAEA expressed concern over Iran's intention to introduce 37 tons of yellowcake, a milled uranium oxide regarded as the first element in the enriched uranium process. But the resolution did not threaten any measures against Teheran, Middle East Newsline reported.
The United States protested the decision.
"To wait until the IAEA finds the nuclear weapons is to wait until it is too late," U.S. chief delegate Jackie Sanders told the IAEA board.
"With every passing week, Iran moves that much closer to reaching the point where neither we, nor any other international body, will be able to prevent it from achieving nuclear weapons capacity."
The resolution set a Nov. 25 deadline for a review of Iran's nuclear program and called for the suspension of Teheran's uranium enrichment activities.
The resolution regarding Iran, a signatory to the Nuclear Non-Proliferation Treaty, was passed unanimously by the agency's 35-nation board of governors.
The resolution on Saturday called on IAEA director-general Mohammed El Baradei to submit a report in advance of the November board meeting regarding Iranian compliance. The El Baradei report would also address previous resolutions that called for a "full suspension of all [Iranian] enrichment-related and reprocessing activities."
"It [IAEA at November meeting] will decide whether or not further steps are appropriate in relation to Iran's obligations under its NPT Safeguards Agreement," the resolution said.
The latest resolution, which marked the end to the agency's board of governors meeting in Vienna, called for a halt to a range of Iranian nuclear activities.
"...Iran [should] immediately suspend all enrichment-related activities, including the manufacture or import of centrifuge components, the assembly and testing of centrifuges," the resolution said. "[The resolution] calls again on Iran, as a further confidence-building measure, voluntarily to reconsider its decision to start construction of a research reactor moderated by heavy water."
At the same time, the resolution failed to set an automatic trigger that would send the Iranian nuclear issue to the United Nations Security Council for possible sanctions. The agency, over U.S. objections, also insisted that the resolution contain a clause that reiterated Iran's right to administer a civilian nuclear program.
Iran has pledged to continue its nuclear program as well as uranium enrichment. But Iranian officials said Teheran would decide over the next week whether to temporarily suspend uranium enrichment.
For his part, El Baradei said inspectors have not found evidence that Iran was producing nuclear weapons. But the IAEA's latest report said inspectors required further study of Iran's nuclear program, including such issues as enriched uranium contamination, the scope of the P-2 centrifuge program and the timeframe of Iran's plutonium separation experiments.
U.S. officials said the resolution could mark a turning point in diplomatic efforts to halt Iran's nuclear weapons program. They said the agency was being ordered to end nearly two years of investigation by determining whether Teheran has been in compliance with the NPT.
Copyright ? 2004 East West Services, Inc.

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Iranian Tales
An evil regime.
As our leaders, hypnotized by the cobra's fatal dance and entranced by the fakir's music, stand immobile while the mullahs complete their nuclear program, it may be useful for the rest of us to maintain a clear-eyed understanding of the nature of the most formidable terror regime in the world. Would that our oxymoronic intelligence community and the feckless foreign service paid attention, but that would be more difficult than liberating Iran itself. Two recent events provide the basic profile.
First is the story of Sheikh Rasini of Tehran, a religious leader of middling importance who attracted the attention of some of the more sober officials of the Revolutionary Guard in the mid-Nineties. It seems Rasini was spending a lot of time in the intimacy of young boys, and showed other signs of corruption. The Guardians of the Revolution objected, and took their complaints to the Ayatollah Milani, who duly issued a fatwa authorizing a violent death for the sheikh. But Rasini turned the tables on his accusers and had them thrown into the nightmarish Evin Prison in Tehran, where Milani and the others were killed.
Rasini continued his active support of gay marriage until, a couple of months ago, he was surprised en flagrante and hauled before an Islamic tribunal for his conjugal activities with one Amir. The situation looked grave for the sheikh until the mullahs came up with an imaginative solution. Amir was "converted" to the opposite sex by some of Tehran's finest surgeons, thereby removing -- quite literally -- the basis for the accusation.
Amir is now Zohreh, and she and her sheikh may well live happily for the foreseeable future.
Then comes the story of Mehdi Derayati, also of Tehran, whose midadventures were reported a couple of days ago by ILNA, the Islamic Labor News Agency. Mehdi Derayati is a young Iranian who worked for a while with some internet news sites that apparently published some stuff that offended the mullahcracy. Like hundreds of young Iranians who enrage the mullahs, Mehdi was summarily rounded up and carted off...who knows where. It's a very common occurrence in the country that our Deputy Secretary of State, Richard Armitage, calls a "democracy," and it would hardly be worth mentioning were it not for Mehdi's lineage. For he is the son of Mustafa Derayati, the personal adviser on clerical affairs to President Khatami.
Mustafa Derayati was so upset at the mistreatment of his boy that he gave a public interview. "All we have had is a few phone calls from him, we know he has been arrested but no law-enforcement authority is telling us where he is. They just say we have acted in accordance with our duties."
To which my pen pal Potkin Azarmehr neatly adds, "Well there you go. So much for Khatami's "Civil Society" which fooled so many gullible anti-Americans in Europe. Here is an example of an Islamic Civil Society where the president's adviser is unable to find out where his son is incarcerated. What hope for the ordinary Iranian parents searching for their abducted sons or daughters?"
When people ask me why the Iranian people so hate the regime, I begin telling them stories like these, because no list of adjectives, no amount of statistics on social misery, child prostitution, unemployment, corruption of the elite, or drug addiction can convey the horror of this murderous tyranny. If a mullah is caught committing an act that would automatically lead to the death penalty for an ordinary citizen, the problem is "fixed" by a sex-change operation on his partner. But even the son of a counselor to the president can be "vanished" without any accountability.
Can you imagine these creatures with atomic bombs? And yet the U.N. issues yet another "deadline" for the end of November, the European Union preens itself on its avoidance of conflict, even with evil, the president speaks bravely but does nothing to support freedom in Iran, and his challenger lets it be known that, if elected, he will offer the mullahs the same misguided nuclear deal that has already failed in North Korea.
Pfui.
-- Michael Ledeen, an NRO contributing editor, is most recently the author of The War Against the Terror Masters. Ledeen is Resident Scholar in the Freedom Chair at the American Enterprise Institute.
http://www.nationalreview.com/ledeen/ledeen200409200836.asp

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>> RUSSIA

Russia: Our Partner in the War on Terror?
By John Radzilowski
FrontPageMagazine.com | September 20, 2004
The horrific mass murder of schoolchildren and their families in Beslan, Russia, by Chechen terrorists has brought widespread sympathy from Americans for the victims and for the Russian people. Many Americans have also felt encouraged by the mass rallies in Moscow against terrorism and by Russian President Vladimir Putin's vow to take unilateral action anywhere in the world against terrorists. The hope has risen that, after opposing the U.S. in Iraq, Russia is now "on side" in the fight against militant Islam.
But the reality is far more complicated.
Russian foreign policy has long been opposed to fundamental American interests--before and after 9/11--despite official statements from the Putin government and the beliefs of many Russia experts in American academia and policy circles. And there is little indication that Russia's policies will change for the better. Even if they did, Russia has a poor record in waging low-intensity conflicts and any action it may take could easily backfire.
Russia has long been a key supporter of rogue states in the Middle East, even building a nuclear reactor for the atomic ayatollahs in Tehran. Only with Russian assistance has Iran been able to sustain its nuclear weapons program.
Russia played a crucial role in rearming Saddam Hussein after the First Gulf War. Russian contractors from companies with close links to the Russian military were meeting with Saddam and his inner circle almost until the very end of that corrupt and brutal regime. Russia not only provided basic weapons but also more sophisticated items, such as night vision equipment. Belarus, whose megalomaniac dictator is closely tied to Russia, was helping to rebuild Saddam's air defense system and providing a wide range of other weapons to the Iraqi dictator (many shipped through Syria). It is unlikely the Belarusans would have done this without tacit Russian approval.
In return, money from Saddam's oil for food program greased the wheels for Russian officials, both inside the government and in the semi-official channels where real power is distributed in Russia. Documents found in Baghdad after the fall of Saddam revealed that the largest number of payoffs went to Russian recipients, most of them of them governmental or quasi-governmental.
There is no indication that the massacre in Belsan will result in any change in a Russian policy that has paid such dividends for Russia's leaders. There may be tough talk and an increase in military activity along Russia's southern border, but real change is highly unlikely. Ordinary Russians, like those slaughtered in Beslan, will be the losers. (Though to be accurate, most of the victims of the school massacre were ethnic Ossetians.)
In a normal society, the government acts to protect its citizens. In America, 9/11 not only led to widespread outrage and anger, it forced our government to make major changes in an effort to prevent further attack. In Russia, the government simply does not care about its people. There, the people exist to serve the state, not the state the people. So while Russian leaders will use the murder of children in Beslan to further their own goals, fundamental change is unlikely.
The Russian leadership has traditionally seen its own people as expendable. During World War II, NVKD troops forced masses of raw recruits to charge at gunpoint across Nazi minefields to clear the way for Soviet tanks. This attitude was best summed up by seventeenth century Russian leaders who, after their massive army was wiped out in an attempted invasion of Poland, responded: "We have a lot of people."
Russian "help" in the fight against Islamic extremism is likely to hurt the U.S. and its allies. Russia's effort to suppress rebellious Chechnya has featured indiscriminate bombing of towns and cities, mass execution of civilians, torture, and countless other abuses. Furthermore, if history is any guide, Russia is likely to target moderate Chechens that can be easily located and shot rather than the hardcore fanatics responsible for the school massacre.
Chechyna today is a lawless wasteland where the innocent are punished because the guilty have fled to the hills with guns and it is too much trouble to root them out. Russian tactics have not only proven totally ineffective--demonstrating that they learned little from the Afghan fiasco in the 1980s--but have hardened Chechen resistance. Contrast this with the U.S. approach in both Afghanistan and Iraq: careful use of precision weapons, surgical ground strikes led by special forces, an emphasis on gathering local intelligence, quickly restoring civilian infrastructure, and training a cadre of local allies who have a stake in stabilizing the country.
Russia's fundamental interests include reducing American power and influence, and re-establishing control over neighboring countries that gained independence in the early 1990s. These goals have been open secrets for years and often politely ignored by American policymakers and their academic fellow travelers. Russia's pursuit of these interests can only increase regional instability and, if pursued aggressively enough, provide new breeding grounds for terror. It could also poison America's effort to bring some measure of stability to countries like Afghanistan.
Americans must be very careful about listening to government statements from Russian officials; they sound good but have little substance. As in France and Germany, such officials know how to play the American media like a fine violin, realizing it is the key to shaping American opinion. They must also be careful about the mainstream media's favorite Russia experts, many of whom are recycled Sovietologists whose ability to accurately assess events in Russia is infamously poor.
The internal discourse in Russia is quite different than what appears in official statements directed toward the West. The foreign policy and military establishment remains committed to re-establishing an empire, not combating terrorism. Many aspects of the Beslan massacre and the military's miscues during the rescue have been covered up to present a sanitized version of elite special forces doing their best to save the trapped children. The Russian public, however, is deeply skeptical of the official version of events. While outraged by the massacre, few believe their government has told them the whole truth. Russians are hardly uniting behind the Putin regime as Americans did behind George Bush in the wake of 9/11.
Under such circumstances, America must be very cautious in accepting Russia as a bone fide partner in the global war on terror. Naturally, real Russian help would be welcome, but while Russia continues its aid for Iran's nuclear ambitions and its opposition to America's effort to rebuild a stable Iraq, this is one "ally" we cannot afford to trust.
John Radzilowski, Ph.D., is a senior fellow at the Piast Institute, Detroit, and is the author or co-author of 11 books and numerous articles. He can be contacted at jradzilow@aol.com.

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Kerry's Flip-Flopping on Russia
By Vance Serchuk
Posted: Friday, September 17, 2004
ARTICLES
The Daily Standard
Publication Date: September 16, 2004
In reaction to Russian President Vladimir Putin's announcement this week of plans to curtail democratic institutions in Russia and assert increased political control over the country from Moscow, Democratic presidential nominee Senator John Kerry criticized President Bush for having "taken his eye off the ball--ignoring America's interest in seeing democracy advance in Russia," and promised that, under his administration, "The fate of freedom and democracy in Russia will once again be priorities of American foreign policy."
Fair enough--but for the fact that Kerry told the Washington Post in May that, as president, he "would play down the promotion of democracy in dealing with . . . Russia." Instead, the Senator pledged to focus "on other objectives . . . more central to the United States' security." He also rejected the idea--put forward last January by then-rival, now-running mate John Edwards--that Russia's membership in the G-8 should be linked to democratic reforms.
It seems that whatever the issue--be it Iraq, the war on terror, or now Russia--Senator Kerry has a hard time knowing his own mind.
Vance Serchuk a research associate, in defense and security policy studies at the American Enterprise Institute.

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No Peter the Great
Vladimir Putin is in the Andropov mold.
By Ion Mihai Pacepa
Vladimir Putin looks more and more like a heavy-handed imitation of Yuri Andropov -- does anyone still remember him? Andropov was that other KGB chairman who rose all the way up to the Kremlin throne, and who was also once my de facto boss. Considering that Putin has inherited upwards of 6,000 suspected strategic nuclear weapons, this is frightening news.
Former KGB officers are now running Russia's government, just as they did during Andropov's reign, and the Kremlin's image -- another Andropov specialty -- continues to be more important than people's real lives in that still-inscrutable country. The government's recent catastrophic Beslan operation was a reenactment of the effort to "rescue" 2,000 people from Moscow's Dubrovka Theater, where the "new" KGB flooded the hall with fentanyl gas and caused the death of 129 hostages. No wonder Putin ordered Andropov's statue -- which had been removed after the Soviet Union's collapse in 1991 -- reinstalled at the Lubyanka.
In the West, if Andropov is remembered at all, it is for his brutal suppression of political dissidence at home and for his role in planning the 1968 invasion of Czechoslovakia. By contrast, the leaders of the former Warsaw Pact intelligence community, when I was one of them, looked up to Andropov as the man who substituted the KGB for the Communist party in governing the Soviet Union, and who was the godfather of Russia's new era of deception operations aimed at improving the badly damaged image of Soviet rulers in the West.
In early 2000, President Putin divided Russia into seven "super" districts, each headed by a "presidential representative," and he gave five of these seven new posts to former KGB officers. Soon, his KGB colleagues occupied nearly 50 percent of the top government positions in Moscow. In a brief interview with Ted Koppel on Nightline, Putin admitted that he had stuffed the Kremlin with former KGB officers, but he said it was because he wanted to root out graft. "I have known them for many years and I trust them. It has nothing to do with ideology. It's simply a matter of their professional qualities and personal relationship."
THE NATIONAL POLITICAL PASTIME
In reality, it's an old Russian tradition to fill the most important governmental positions with undercover intelligence officers. The czarist Okhrana security service planted its agents everywhere: in the central and local government, and in political parties, labor unions, churches, and newspapers. Until 1913, Pravda itself was edited by one of them, Roman Malinovsky, who rose to become Lenin's deputy for Russia and the chairman of the Bolshevik faction in the Duma.
Andropov Sovietized that Russian tradition and extended its application nationwide. It was something similar to militarizing the government in wartime, but it was accomplished by the KGB. In 1972, when he launched this new offensive, KGB Chairman Andropov told me that this would help eliminate the current plague of theft and bureaucratic chaos and would combat the growing sympathy for American jazz, films, and blue jeans obsessing the younger Soviet generation. Andropov's new undercover officers were secretly remunerated with tax-free salary supplements and job promotions. In exchange, Andropov explained, they would secretly have to obey "our" military regulations, practice "our" military discipline and carry out "our" tasks, if they wanted to keep their jobs. Of course, the KGB had long been using diplomatic cover slots for its officers assigned abroad, but Andropov's new approach was designed to influence the Soviet Union itself.
The lines separating the leadership of the country from the intelligence apparatus had blurred in the Soviet satellites as well. After I was granted political asylum in the United States in July 1978, the Western media reported that my defection had unleashed the greatest political purge in the history of Communist Romania. Ceausescu had demoted politburo members, fired one-third of his cabinet, and replaced ambassadors. All were undercover intelligence officers whose military documents and pay vouchers I had regularly signed off on.
THE MAKING OF A DICTATOR
General Aleksandr Sakharovsky, the Soviet gauleiter of Romania who rose to head the Soviet foreign intelligence service for an unprecedented 15 years, used to predict to me that KGB Chairman Andropov would soon have the whole Soviet bloc in his vest pocket, and that he would surely end up in the Kremlin. Andropov would have to wait ten years until Brezhnev died, but on November 12, 1982, he did take up the country's reins. Once settled in the Kremlin, Andropov surrounded himself with KGB officers, who immediately went on a propaganda offensive to introduce him to the West as a "moderate" Communist and a sensitive, warm, Western-oriented man who allegedly enjoyed an occasional drink of Scotch, liked to read English novels, and loved listening to American jazz and the music of Beethoven. In actual fact, Andropov did not drink, as he was already terminally ill from a kidney disorder, and the rest of the portrayal was equally false.
In 1999, when Putin became prime minister, he also surrounded himself with KGB officers, who began describing him as a "Europeanized" leader -- capitalizing, ironically, on the fact that he had been a KGB spy abroad. Yet Putin's only foreign experience had been in East Germany, on Moscow's side of the Berlin Wall. Soon after that I visited the Stasi headquarters in Leipzig and Dresden to see where Putin had spent his "Europeanizing" years. Local representatives of the Gauck Commission -- a special post-Communism German panel researching the Stasi files -- said that the "Soviet-German 'friendship house'" Putin headed for six years was actually a KGB front with operational offices at the Leipzig and Dresden Stasi headquarters. Putin's real task was to recruit East German engineers as KGB agents and send them to the West to steal American technologies.
I visited those offices and found that they looked just like the offices of my own midlevel case officers in regional Securitate directorates in Romania. Yet Moscow claims Putin had held an important job in East Germany and was decorated by the East German government. The Gauck Commission confirmed that Putin was decorated in 1988 "for his KGB work in the East German cities of Dresden and Leipzig." According to the West German magazine Der Spiegel, he received a bronze medal from the East German Stasi as a "typical representative of second-rank agents." There, in those prison-like buildings, cut off even from real East German life by Stasi guards with machine guns and police dogs, Lieutenant Colonel Putin could not possibly have become the modern-day, Western-oriented Peter the Great that the Kremlin's propaganda machine is so energetically spinning.
Indeed, on December 20, 1999, Russia's newly appointed prime minister visited the Lubyanka to deliver a speech on this "memorable day," commemorating Lenin's founding of the first Soviet political police, the Cheka. "Several years ago we fell prey to the illusion that we have no enemies," Putin told a meeting of top security officials. "We have paid dearly for this. Russia has its own national interests, and we have to defend them." The following day, December 21, 1999, another "memorable day" in Soviet history -- Stalin's 120th birthday -- Putin organized a closed-door reception in his Kremlin office reported as being for the politicians who had won seats in the Duma. There he raised a glass to good old Iosif Vissarionovich Dzhugashvili (Stalin, meaning "man of steel," was the dictator's nom de guerre).
Days later, in a 14-page article entitled "Russia on the Threshold of a New Millennium," Putin defined Russia's new "democratic" future: "The state must be where and as needed; freedom must be where and as required." The Chechens' effort to regain their independence was mere "terrorism," and he pledged to eradicate it: "We'll get them anywhere -- if we find terrorists sitting in the outhouse, then we will piss on them there. The matter is settled." It is not.
SCAPEGOATING AND CONSOLIDATING
On September 9, 2004, Chechen nationalists announced a $20 million prize on the head of the "war criminal" Vladimir Putin, whom they accuse of "murdering hundreds of thousands of peaceful civilians on the territory of Chechnya, including tens of thousands of children."
For his part, President Putin tried to divert the outrage over the horrific Breslan catastrophe away from his KGB colleagues who had caused it, and to direct public anger toward the KGB's archenemy, the U.S. Citing meetings of mid-level U.S. officials with Chechen leaders, Putin accused Washington of having a double standard when dealing with terrorism. "Why don't you meet Osama bin Laden, invite him to Brussels or to the White House and engage in talks, ask him what he wants and give it to him so he leaves you in peace?" Putin told reporters in Moscow.
Then Putin blamed the collapse of the Soviet Union for what he called a "full scale" terrorist war against Russia and started taking Soviet-style steps to strengthen the Kremlin's power. On September 13, he announced measures to eliminate the election of the country's governors, who should now be appointed by the Kremlin, and to allow only "certified" people -- that is, former KGB officers -- to run for the parliament.
When the Soviet Union collapsed, its people had a unique opportunity to cast out their political police, a peculiarly Russian instrument of power that has for centuries isolated their country from the real world and in the end left them ill-equipped to deal with the complexities of modern society. Unfortunately, up until then most Russians had never owned property, had never experienced a free-market economy, and had never made decisions for themselves. Under Communism they were taught to despise Western democracy and everything they believed to be connected with capitalism, e.g., free enterprise, decision-making, hard work, risk-taking, and social inequality. Moreover, the Russians had also had minimal experience with real political parties, since their country has been a police state since the 16th century. To them, it seemed easier to continue the tradition of the political police state than to take the risk of starting everything anew.
But the times have changed dramatically. My native country, which borders Russia, is a good example. At first, Romania's post-Communism rulers, for whom managing the country with the help of the political police was the only form of government they had ever known, bent over backwards to preserve the KGB-created Securitate, a criminal organization that became the symbol of Communist tyranny in the West. Article 27 of Romania's 1990 law for organizing the new intelligence services stated that only former Securitate officers "who have been found guilty of crimes against fundamental human rights and against freedom" could not be employed in the "new" intelligence services. In other words, only Ceausescu would not have been eligible for employment there. Today, Romania still has the same president as in 1990, but his country is now a member of NATO and is helping the U.S. to rid the world of Cold War-style dictators and the terrorism they generated.
Russia can also break with its Communist past and join our fight against despots and terrorists. We can help them do it, but first we should have a clear understanding of what is now going on behind the veil of secrecy that still surrounds the Kremlin.
-- Ion Mihai Pacepa, a former two-star general, is the highest-ranking intelligence officer to have defected from the Soviet bloc. His book Red Horizons has been republished in 27 countries.
http://www.nationalreview.com/comment/pacepa200409200814.asp

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>> IAEA

U.N. nuclear agency asleep at the switch
By Bill Gertz
THE WASHINGTON TIMES
The United States stood by for years as supposed allies helped its enemies obtain the world's most dangerous weapons, reveals Bill Gertz, defense and national security reporter for The Washington Times, in the new book "Treachery" (Crown Forum).

Last of three excerpts
Hoshyar Zebari, Iraq's new foreign minister, delivered a memorable address to the United Nations Security Council in New York on Dec. 16, 2003.
Zebari, an Iraqi Kurd, began his remarks by noting the historic capture, three days earlier, of Saddam Hussein. Then, after laying out a plan for Iraq to become a democracy, the foreign minister lowered the boom on the assembled diplomats.
"One year ago," Zebari said, "this Security Council was divided between those who wanted to appease Saddam Hussein and those who wantedto hold him accountable. The United Nations as an organization failed to help rescue the Iraqi people from a murderous tyranny that lasted over 35 years, and today, we are unearthing thousands of victims in horrifying testament to that failure.
"The United Nations must not fail the Iraqi people again," he said.
It was clear to whom Zebari was referring: France, Germany, Russia and China, among others in the world body, fought U.S.-led efforts to end Saddam's bloody dictatorship.
But the organization's failure was far more significant than failing the Iraqi people. The United Nations had failed in its founding purpose: to preserve peace and international security.
It appeased Saddam for years before the United States called for decisive action.
And Saddam's Iraq is just one of many rogue regimes that the United Nations has failed to keep in check. Again and again, dangerous states have built up their militaries and weapons programs right under the world body's nose, despite sanctions and anti-proliferation agreements.
Sleeping watchdog
Three times, the United Nations' nuclear watchdog agency missed the covert nuclear-arms programs of rogue regimes, allowing those states to build deadly weapons capability under the guise of generating nuclear power.
Disclosures of the nuclear progress of North Korea, Libya and Iran came in rapid succession, within the space of about a year. If the International Atomic Energy Agency (IAEA) did not detect these programs, one must wonder what purpose the U.N. branch serves.
The United Nations established the IAEA in 1957 to help countries build nuclear facilities for generating electricity. Its initial program, Atoms for Peace, quickly became "Atoms for Bombs." And not much has changed in the past five decades, except the size of the program.
Today, the IAEA has about 2,200 staff members at its headquarters in Vienna, Austria, and at four regional offices in Geneva, New York, Toronto and Tokyo. Its budget for 2004 was $268.5 million.
The IAEA's statutory purpose is to assist in transferring expertise and equipment for the "peaceful" use of nuclear power. The international agency also is charged with making sure that nations do not divert equipment or material for nuclear-energy development into weapons programs.
Specifically, Section 5 of the empowering statute directs the IAEA to "establish and administer safeguards designed to ensure that special fissionable and other materials, services, equipment, facilities and information made available by the agency or at its request or under its supervision or control are not used in such a way as to further any military purpose."
But the IAEA has not administered appropriate safeguards. And as a result, it has been fooled again and again by states such as North Korea, Iran, Libya, Syria and Iraq.
The centerpiece of the IAEA's work has been the Treaty on the Nonproliferation of Nuclear Weapons, or NPT, which went into effect on March 5, 1970.
Korean threat
Rogue states generally sign international agreements only if doing so is expedient. Nothing better illustrates this point than North Korea.
The NPT provided cover for North Korea's secret nuclear-weapons programs, allowing Pyongyang to purchase equipment, train technicians and build reactors.
North Korea was one of the agreement's 188 signatories when, in the fall of 2002, the communist regime of Kim Jong-il revealed that it secretly had been developing nuclear weapons.
The IAEA failed to anticipate or uncover North Korea's nuclear-weapons program. The agency admitted as much last year, when it reported: "The agency has never had the complete picture regarding [North Korean] nuclear activities."
Pyongyang froze plutonium production as part of a 1994 pact with the United States known as the Agreed Framework. But the CIA noted in 1995, in a classified Special National Intelligence Estimate: "Based on North Korea's past behavior, the [intelligence] community agrees it would dismantle its known program [only] if it had covertly developed another source of fissile material."
Sure enough, North Korea's disclosure in October 2002 of its uranium-enrichment activity confirmed that Pyongyang was trying to build nuclear bombs. In essence, Kim and the North Koreans were announcing that membership in the NPT had been a ruse all along.
Still, the IAEA did not take a hard line with Kim. It responded to the disclosure by sending faxes requesting "clarification." The North Koreans ignored the request.
Saber-rattling
The IAEA adopted a resolution calling on Pyongyang to cooperate. The North Koreans responded with a letter saying that they rejected the U.N. agency's unfair and unilateral approach.
The director of North Korea's nuclear program, Ri Je-son, stated in a letter dated Dec. 4, 2002, that Pyongyang would resume nuclear work if the United States did not resume oil shipments to North Korea.
Then, on Jan. 10, 2003, North Korea unceremoniously abandoned its partners in the NPT. In a broadcast on Kim's state radio, government commentator Jong Pong-kil said the decision to pull out was a defensive measure:
"The United States trampled on the NPT and the [North Korean]-U.S. Agreed Framework and is trying to crush us by all means," Jong declared. "By even mobilizing the IAEA, the United States is compelling us to give up the right of self-defense. Under such conditions, it is clear to everyone that we cannot let the country's security and the nation's dignity be infringed upon by remaining in the NPT treaty."
Jong then added a threat: "If the U.S. imperialists and their following forces challenge our republic's withdrawal from the NPT with new pressure and sanctions, we will respond with a stronger self-defensive measure."
In other words, the North Koreans, who already had shown that their membership in the NPT was a ruse, were announcing that they would keep building nuclear arms.
The IAEA's response to Jong's announcement was tantamount to appeasement. Director-General Mohamed ElBaradei, an Egyptian, said North Korea must return to the NPT.
Then, during a meeting with U.S. senators, ElBaradei said: "If North Korea were to show good behavior, they need to get some assurance as to what to expect in return for good behavior, and I think that's very important in articulation of what to expect in case of compliance."
It did not matter that the North Koreans openly admitted defying the IAEA for years; ElBaradei sent the message that the international arms-control agency would impose no penalty.
The matter was sent to the U.N. Security Council, but that body did little more than express "deep concern" for the violations. The United States picked up its diplomatic approach, which produced no results. North Korea continues its drive for nuclear arms.
Iran and Libya
The United Nations also failed to confront the nuclear threat from Iran, which, like North Korea, used the NPT to acquire equipment and materials to make nuclear bombs.
When Iran's weapons work was discovered, showing that the Iranians knowingly ignored obligations to their treaty partners, the IAEA essentially ignored the violations. The agency sought only an additional "protocol" from Iran as a new safeguard.
"This is a good day for peace, multilateralism and nonproliferation," ElBaradei declared after Iran signed the protocol. "A good day for peace because the [IAEA] board decided to continue to make every effort to use verification and diplomacy to resolve questions about Iran's nuclear program."
But "verification and diplomacy" failed to stop Iran from developing nuclear arms in the first place. Despite pressure from security officials within the Bush administration, ElBaradei refused to cite Iran for breaking its obligations.
Moreover, the IAEA did not keep careful watch over Libya's nuclear-weapons program, which was further along than both U.S. intelligence or the U.N. agency had known.
When Libyan dictator Moammar Gadhafi publicly disclosed his weapons program in December 2003, the IAEA knew nothing about it. The agency said Libya should have reported its activities to the IAEA.
The IAEA was happy to report Tripoli's decision to eliminate "materials, equipment and programs which lead to the production of internationally proscribed weapons."
But the agency tried to minimize its failure to discover the program. It noted that a Libyan official characterized his nation's uranium-enrichment program as "at an early stage of development" and that "no industrial-scale facility had been built, nor any enriched uranium produced."
Algeria long since had launched its own nuclear-arms program in response to the military buildup by neighbor Libya, with which it had tense relations, reflecting how weapons proliferation only breeds further proliferation.
U.S. intelligence agencies in the spring of 1991 detected the first signs that Algeria was developing nuclear weapons with the assistance of China.
'New urgency'
The ultimate threat to peace is nuclear weapons in the hands of international terrorists.
There is a real danger that terrorists could use nuclear materials in radiological attacks, or "dirty bombs." Worse, terrorists would use them in a nuclear blast that could kill thousands or even hundreds of thousands.
To his credit, the IAEA's ElBaradei has begun to worry about this threat.
"[Nuclear] source security has taken on a new urgency since 9/11," the U.N. arms agency's director general said in a speech last year. "There are millions of radiological sources used throughout the world. Most are very weak. What we are focusing on is preventing the theft or loss of control of the powerful radiological sources."
The fact is, al Qaeda and the world's other most lethal terrorist organizations are trying to acquire nuclear arms.
The United Nations' record of failure to detect and halt nuclear threats posed by rogue states, however, casts doubt on its ability to grapple with such arms in the grip of shadowy terrorist groups.

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>> NORTH KOREA

Envoy Hopes to Lift Lid on North Korean Human Rights Situation
By Patrick Goodenough
CNSNews.com Pacific Rim Bureau Chief
September 17, 2004
Pacific Rim Bureau (CNSNews.com) - The newly-appointed U.N. special rapporteur (investigator) on North Korean human rights has expressed the hope that the authorities in the reclusive communist state will allow him to visit.
Vitit Muntarbhorn, a Thai law professor, is visiting South Korea where U.N. human rights officials have been participating in an international conference.
Muntarbhorn was appointed by the U.N. Commission on Human Rights in July, in line with a resolution taken by the 53-nation body censuring Pyongyang for human rights abuses.
The resolution urged the country to allow independent access to provide for an accurate and independent picture of the situation.
It cited reports of widespread abuses, "including torture, public executions, extrajudicial and arbitrary detention, imposition of the death penalty for political reasons, the existence of a large number of prison camps and the extensive use of forced labor; all-pervasive and severe restrictions on the freedoms of thought, conscience, religion, opinion and expression, peaceful assembly and association; and continued violation of the human rights and fundamental freedoms of women."
North Korea denounced the resolution, calling it a "U.S.-orchestrated plot," and threatened to withdraw from the UNCHR in protest.
Speaking in Seoul, Muntarbhorn said he planned later this month to formally ask North Korea, through its diplomats in Geneva, to allow him direct access to the country to carry out what he said would be a fair and independent probe into conditions there.
He is expected to report back at the UNCHR's next annual session, in March 2005.
Human rights campaigners have long been pressing for the international community to take a firmer line with North Korea. Activists have pressed the U.S. government to include discussions on human rights when meeting North Korean officials for talks about Pyongyang's nuclear weapons programs.
In what may be a positive sign, the first British government minister to visit North Korea said this week that his hosts had admitted not giving human rights high priority in their policy making.
Junior Foreign Office minister Bill Rammell said in an article published in London Thursday that North Korean officials had also confessed the existence of labor camps for political prisoners.
It's believed to be the first time North Korea has admitted the existence of the dozen or so notorious camps, where researchers allege horrific abuses including torture, forced abortions, infanticide and even the testing of chemicals on inmates.
Hundreds of thousands of political prisoners and criminals are believed to be held in the camps, in remote parts of North Korea, and malnutrition, forced labor, and beatings are reportedly commonplace.
Last October, the U.S. Committee for Human Rights in North Korea, a non-governmental organization (NGO), released a comprehensive report on North Korea's prison camp system, including satellite photographs and eyewitness accounts by defectors.
Among those sent to prison camps are defectors who managed to escape into neighboring China in the hope of eventually getting asylum in South Korea or another country, but were caught and repatriated by a fellow communist regime that does not recognize the North Koreans as refugees.
U.N. human rights commissioner Louise Arbour, who participated in this week's conference in Seoul, indicated at a press conference Thursday that Beijing should protect North Korean refugees rather than send them home.
Asked about China's policy of repatriating North Korean defectors, Arbour replied that "countries that ratified the 1951 convention on refugees have an obligation to protect persons who are in a vulnerable position."
The 1951 U.N. convention, to which China is a signatory, requires member countries to "not forcibly return asylum seekers who face persecution at home."
Human rights groups have in the past roundly criticized the U.N. refugee agency UNHCR for not pressing China sufficiently on this issue.
In its annual report on religious freedom worldwide, released this week, the State Department again named North Korea as a "country of particular concern" in this area.
The report said the state of human rights in the country was "deplorable," citing the repression of unauthorized religious groups and reports of the killing of members of underground Christian churches.
Ambassador John Hanford, head of the State Department's religious freedom office, told a press conference in Washington Wednesday that North Korea may well have "the largest religious prisoner population in the world."
The department said there were around 10,000 Protestants, 4,000 Catholics and 10,000 Buddhists in North Korea, a country of 22 million people.
South Korean NGOs believe the actual number is considerably higher.
--------------------------------------------------------------------------------

>> PORK

Pork: The Other Security Threat
09/17/04 11:10 AM Congress is finally trying to "distribut[e] antiterrorism money on the basis of threat and risk, not pork-barrel politics." James Carafano has warned against using homeland security money "to put states on another federal dole," and a bill proposed by Christopher Cox (R-CA) would reduce the minimum portion of a $2.2 billion federal fund guaranteed each state from 0.75 percent to 0.25 percent. As Carafano notes, the current formula "translates to $5.03 per capita in California and $37.94 per capita in Wyoming...40 percent of funds are immediately tied up, leaving only 60 percent for discretionary allocations." Problems in the distribution of the Urban Area Security Initiative grants remain to be addressed. Intended for "high-risk areas," the fund's "formula seriously undervalues actual intelligence and known targets" according to Carafano and its monies are scheduled to be disbursed (and dispersed) among some 80 cities rather than the original seven.
? 1995 - 2004 The Heritage Foundation
All Rights Reserved.

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>> EU?


Arbitrary and Capricious
The Precautionary Principle in the European Union Courts
Posted: Friday, September 17, 2004
PRESS RELEASES
AEI Online (Washington)
Publication Date: September 17, 2004
Arbitrary and Capricious: The Precautionary Principle in the European Courts
By Gary E. Marchant and Kenneth L. Mossman
Killer cranberry juice? The government of Denmark thinks so. Using a new legal concept, "the precautionary principle," which is based on the idea that it is better to be safe than sorry, the Danish government has prohibited the marketing of Ocean Spray cranberry juice on the grounds that the added vitamin C could conceivably harm some individuals.
The same principle is now being used by the European Union (EU) to create restrictions on U.S.-grown beef, genetically modified foods, chemicals, and various other products. This new concept goes beyond the usual application of precaution that traditionally underlies all health, safety, and environmental regulations. Initially characterized as a general policy or guideline, it has now evolved into a binding legal rule in every jurisdiction in which it has been adopted.
Furthermore, because of its inherent ambiguity and arbitrariness, the precautionary principle can be used to justify unreasonable or protectionist measures.
In Arbitrary and Capricious: The Precautionary Principle in the European Courts (AEI Press, August 20, 2004), Gary E. Marchant and Kenneth L. Mossman, experts from the Arizona State University's Center for the Study of Law, Science, and Technology, provide factual support for the U.S. challenge to the European Union in the World Trade Organization.
Through a comprehensive empirical analysis of sixty court decisions in the EU, the authors demonstrate that the EU courts have failed to provide a consistent and clear definition of the precautionary principle. Instead, the precautionary principle is being applied in an erratic manner that appears to be based solely on the political and economic interests of the decision-maker.
Some of the specific findings of this study include:
Despite the fact that the precautionary principle is being used to decide regulatory issues of enormous consequence, neither the EU regulators nor the EU courts have defined or provided any specific formulation for it. The concept therefore remains ambiguous, which permits it to be applied (or not) depending on the particular decision-maker.
The precautionary principle is being used to justify absurd and unjustified regulations in the EU. For example, individual EU countries have invoked the precautionary principle to ban products such as Kellogg's Corn Flakes, caffeinated energy drinks, and fruit juice drinks. Only a few of these decisions have been overturned by the courts.
The precautionary principle is applied inconsistently by the EU courts. In some cases, the precautionary principle is applied as a draconian sledgehammer that results in overturning longstanding due-process principles. It is also used to ban products with no evidence of risk. When applied in this manner, the precautionary principle could result in the banning of any product to which it is applied. In other cases, the precautionary principle is given no weight at all by the EU courts, having no effect on the pre-existing regulatory criteria and regulatory outcomes.
In several cases, the precautionary principle has been applied by the courts and has resulted in direct conflicts with the recommendations of the EU's own official scientific advisory bodies.
The precautionary principle is now used in more than twenty international treaties and in more than twenty countries. In Arbitrary and Capricious: The Precautionary Principle in the European Courts, Marchant and Mossman confirm many of the fears that the amorphous precautionary principle has been applied in an arbitrary and unreasonable manner that can be used to support protectionist and other inappropriate measures. Through their comprehensive empirical analysis, they warn against one of the most significant and controversial innovations in international environmental, health, and safety policy over the past quarter century.

Media inquiries: V?ronique Rodman
202.862.4871 (vrodman@aei.org)
Orders: 800.343.4499
www.aei.org/books
--------------------------------------------------------------------------------
>> POLICY


Using Social Security Personal Retirement Accounts to Create Family Nest Eggs
by David C. John
Backgrounder #1785
http://www.heritage.org/Research/SocialSecurity/bg1785.cfm
September 10, 2004
A modernized Social Security could do much more than just provide stable retirement benefits. Low-income and moderate-income workers could use Social Security to create family nest eggs that could either enhance their own retirements or be passed on to their heirs under a system of Social Security personal retirement accounts (PRAs). Because this money would stay within the community, PRAs could become a significant source of capital for businesses in low-income communities. A new Center for Data Analysis (CDA) report1 shows that if the nest egg is passed on to the worker's heirs, it could help the family to break the intergenerational cycle of poverty and keep money in the heirs' own communities.
In each of the 12 examples or case studies, every worker was able to build a nest egg through a PRA, even after using a part of the PRA to finance some of his or her monthly Social Security retirement benefits. (The government would finance the rest of the monthly retirement benefit.) The sizes of the nest eggs ranged from about three months' pay for low-income single workers to literally hundreds of thousands of dollars for moderate-income married couples.
The benefits of a PRA system that allows workers to create nest eggs include:
Inheritances would increase for all income levels. The modernized Social Security system would allow every worker at every income level the opportunity to leave a nest egg to his or her family. Currently, less than 13 percent of all households with annual incomes of less than $20,000 receive inheritances.2 Most of these workers never had the chance to build savings. Only among families with annual incomes over $100,000 does the frequency of inheritance exceed 25 percent. However, Social Security reform would not limit inheritances to the rich. People of all incomes could use their PRAs to build a cash nest egg, which they could leave to their heirs.
The system would be flexible and allow workers to control their retirement. Under the current Social Security program, workers receive only a lifetime annuity. Under a modernized Social Security program, workers could use their entire PRA for a monthly income or use only a portion of it for income and keep the rest in a family nest egg that they could use for emergencies or leave to their heirs.
Money would stay in the community and strengthen its economic base. Because the PRA is the worker's property, any money left over goes to the family. It remains in the community and is available to help it grow because the savings in those accounts could form the capital needed for new businesses. Under today's Social Security, any remaining money stays in Washington.
The reformed system assures a higher benefit than today's retirees receive under the current Social Security system. Today's system pays new retirees about $10,968 per year, while the reformed system would guarantee at least $17,960.
Workers would own their Social Security benefits. Rather than be at the mercy of politicians (who could change Social Security benefits at will), workers would own the money in their PRAs. Families could inherit that money if the worker dies before retirement or if additional funds are left over after retirement.
Workers would have a choice. No one is forced to invest in a PRA. Every worker can decide whether to have a PRA or to remain in the traditional Social Security system.
A well-designed retirement system includes three elements: regular monthly retirement income, dependent's insurance, and the ability to save. Today's Social Security system provides a stable level of retirement income and provides benefits for dependents, but it does not allow workers to accumulate cash savings to fulfill their retirement goals or 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.
Inheritances should not be effectively limited to upper-income families. Moderate-income and lower-income families should be allowed to use Social Security to build a nest egg that they could leave to future generations.
Today's Workers Could Build a Nest Egg with a PRA
Today's workers would be able to develop a significant nest egg under Social Security in every case studied. For instance, a low-income single female could retire with a nest egg equal to over one year's pay, while a married double-income couple--with one earning an average income and the other one earning a low income--could retire with a nest egg that exceeds $50,000. In each case, if the money remains invested, the retirees could leave well over twice their retirement nest egg to their heirs. Appendix 1 provides details of these and other workers studied.
The study assumes that none of today's workers would have a PRA for their entire career because they would already be employed when the program is started. The oldest would be 43 when the hypothetical PRA program is established, while the youngest would be 27. This would especially limit older workers' ability to build significant nest eggs in addition to accumulating enough in their PRAs to finance a portion of their Social Security benefits.
Married couples, including those with only a single income, could build larger nest eggs than the single workers of either gender. The one exception was a single worker who dies at the age of 55 and leaves his entire PRA to heirs before using any of it to finance his retirement benefits. However, even among single workers, the nest egg is significant in virtually every case when compared to the worker's annual income. Even the worker with the lowest nest egg, an average-income single woman, manages to save an amount equal to about three months' pay. Both she and the other worker with the smallest nest egg are among the oldest workers studied. Both are 43 at the time PRAs first become available.
Workers who are already in the workforce when PRAs are established would find building a nest egg more difficult because they have less time to invest. The fact that all of the examples in the CDA study succeed in building a nest egg shows the program's immediate value.
Even Better Results for the Third Generation
Results get even better if workers have a PRA for their entire working lives. In most cases, workers in the 12 case studies build a significantly larger PRA than those who have a PRA for only part of their working lives. They reach even larger amounts when the workers' own contributions are supplemented by sums inherited from other family members.
The results show that workers at all income levels can create significant nest eggs through a PRA, even after using part of their PRAs to finance a portion of their monthly retirement benefits. While the study assumes that today's workers will participate in the PRA program for only part of their working lives (because they would already be employed when PRAs are established), their grandchildren would have these accounts from the first day that they enter the workforce. The results are especially good for those third-generation workers who invest their inheritances from their grandparents. The results are also quite good at almost all income levels for workers who build their PRAs from only their own savings. The money remaining at retirement (after financing their Social Security benefit) could be used to improve their retirement incomes, start a small business, help a grandchild to pay for college, or achieve a number of options--including just holding the amount until it is needed.
Again, PRAs work especially well in producing a significant nest egg for married couples. The only third-generation workers who do not produce significant amounts are single low-income workers who do not invest any of their inheritances. These workers' nest eggs at retirement are mostly under $10,000. However, even then, the nest eggs amount to between three and six months salary and are partially explained by the extremely low earnings levels used in this study.3 Furthermore, these workers always have a choice. They can choose to remain in the traditional Social Security system.
Real world experience shows that many, if not most, retirees are interested in both their own standard of living and in leaving a sum for their heirs. However, the state of their finances combined with the structure of today's Social Security may not allow them to leave an inheritance. The CDA study assumes that the first-generation workers will leave any remaining money in their PRAs to their grandchildren.4
Ideally, the grandchildren who inherit money would invest the entire amount and let it grow over time to an even greater sum. However, Appendix 2 shows results for both (1) investing the entire amount until retirement; and (2) spending the entire inheritance and funding retirement benefits from only their own PRAs. While the grandchildren have substantially more for retirement if they invest their full inheritances, the importance of a PRA that allows workers to build an inheritable nest egg is equally evident if the grandchildren spend their entire inheritances.
The Value of Building Nest Eggs
Family nest eggs can do far more than just help to fix Social Security. A growing body of research shows that they would also:
Allow moderate and low-income workers to leave a bequest to their families;
Help equalize assets between upper-income and lower-income families; and
Change the way that lower-income families view themselves and their connection to society.
Reform plans that allow workers the option of accepting a smaller monthly income and leaving a portion of their savings available for other uses are likely to be more popular than a plan that requires them to spend everything on an annuity. Several studies, both in the United States and elsewhere, show that retirees value plans that allow them to leave money to their families and keep assets available in case of an emergency over plans that provide a guaranteed lifetime income. One study found that retirees avoided purchasing annuities because they wanted to leave money to their families and have savings for emergencies.5 They also felt that annuities cost too much.
Similarly, another study found that only about 40 percent of Chilean workers choose a lifetime annuity when they retire.6 Originally, Chile's personal accounts system allowed retirees to choose either an annuity or a phased withdrawal plan. However, earlier this year the government announced that the system would also offer an annuity that allows workers to receive a slightly lower monthly payment in return for the ability to leave money to their families.7 As long as retirees under such a plan receive enough monthly income to live without government aid, there is no reason why an American Social Security reform plan should not include similar flexibility.
In addition to providing retirees with more control over their savings, family nest eggs could also reduce the gap between the assets owned by upper-income and lower-income families. Edward Wolff of New York University and the Levy Economics Institute found that even modest bequests from one generation to another tend to equalize the distribution of family assets. "Though wealth inequality has risen in the United States between 1983 and 1998, the increase may have been even greater were it not for the mitigating effects of inheritances and gifts."8 Over time, a Social Security reform that makes it easier to leave money to one's family would result in an even greater reduction in the gap between rich and poor families.
Research has also shown that that money left from one generation to another can result in important behavioral changes. Research indicates that people with even modest assets may be more future-oriented, prudent, confident about their prospects, and connected with their communities.9 Clearly, a Social Security system that gives workers the flexibility to leave bequests to their families can have much greater benefits than just reducing Social Security's financial woes. The long-term benefits of this improvement could encourage a much greater change in the way that their families approach the future and their role in society.
Today's Social Security Discourages Workers from Building Nest Eggs
Today's Social Security system has done a fine job of providing retirees with a stable level of retirement income. In addition, it also provides a level of protection against poverty caused by disability or the premature death of a parent. Unfortunately, it not only fails to provide workers with any way to build a family nest egg, it actually discourages savings by absorbing a large proportion of earnings that moderate-income and low-income workers could otherwise save for retirement or use for other purposes. According to the Congressional Budget Office, approximately 80 percent of Americans pay more in payroll taxes than they do in federal income taxes.10
Despite the presence of private methods to invest for retirement, in 2000, approximately one-third of retirees on Social Security received at least 90 percent of their income from Social Security. Almost two-thirds of them depended on Social Security for at least 50 percent of their retirement income.
Today's Social Security faces four major problems that threaten its ability to provide future retirees with the same type of retirement security that was available to their parents and grandparents. These are:
Massive future deficits. In 2018, Social Security's retirement program will begin to spend more in benefits every year than it receives in taxes. A few years after deficits begin, this amount will exceed $100 billion per year and will continue to grow. Social Security has a drawer full of government bonds labeled the "trust fund," but these are nothing more than a pledge to use ever-larger amounts of general revenue taxes to pay benefits. When it repays these bonds, the federal government will have to reduce spending on other government programs, increase income or taxes, or increase government borrowing. Sadly, in 2042, the drawer of paper promises will be empty, and from that point forward, promised benefits will be cut as required by law--first by 27 percent and then by ever greater amounts as Social Security's deficits grow larger.
A poor rate of return on their payroll taxes. Younger and lower-income workers receive relatively little in benefits for their Social Security taxes because they will pay substantially higher taxes than older workers do. A 25-year-old average-income male is predicted to receive a -0.82 percent rate of return on his Social Security taxes. In other words, he will pay more into the system in taxes than he will receive back in benefits. The situation is even worse for low-income workers. A 25-year-old male living in a low-income section of New York City will receive an estimated -4.46 percent rate of return on his Social Security taxes.11
No property rights to their benefits. This is a key flaw. Even if Social Security was reformed to allow workers to build a family nest egg, without property rights the government could reclaim that money at any time. Two Supreme Court cases dealing with Social Security confirm this lack of property rights.12 In both cases, the decision explicitly stated that workers have no level of ownership of their Social Security benefits.
No choice in how their benefits are paid. Under the current inflexible system, all workers receive a monthly payment that starts when they retire and ends when either they die or their spouse dies. This one-size-fits-all approach especially hurts the one-fifth of white males and one-third of African-American males who die between the ages of 50 and 70.13 These workers face the prospect of paying a lifetime of Social Security taxes in return for little or no benefits. A more flexible system would allow them the comfort of knowing that at least a proportion of their taxes will go to their families in the form of a nest egg.
Changing Social Security to Allow Workers
to Build Nest Eggs
In order to study how PRAs could allow workers to build nest eggs (in addition to providing for their retirement benefits), the CDA developed a composite plan that incorporates key features from a number of existing reform plans, as well as other ideas that have not been included in any specific plan.14 The plan is designed to illustrate how all workers, especially lower-income workers, could create a family nest egg and provide a reasonable level of retirement income for all future retirees.
The study assumes that workers under age 55 as of January 1, 2003, would have the choice of either investing some of their existing Social Security taxes in a PRA or remaining in the current system. The amount invested in a worker's PRA would depend on his or her income, ranging from 7 percent of income for the lowest-income workers to 2.5 percent of income for the highest-income workers. This progressive contributions structure is designed both to reduce administrative costs and to allow lower-income workers (who are less likely to have access to other savings vehicles) to build their accounts faster.
For the purposes of this study, the PRAs would be invested in a conservative portfolio of 50 percent stock index funds and 50 percent super-safe government bonds. Investments would be handled through a centralized investment manager similar to the existing Thrift Savings Plan, which serves federal employees. This account structure would earn an estimated 4.7 percent annually after inflation and annual administrative costs equal to 0.3 percent of the account.
For a worker with a PRA, the monthly retirement benefit would be a combination of a government payment and an amount financed from the worker's PRA. A person without minor children who has reached full retirement age would receive substantially higher benefits than workers who retire today. The sample plan would guarantee that single workers receive at least $17,960 annually and couples would receive at least $24,240. In 2002, the current system paid average benefits of only $10,968 to new retirees.
Once a worker purchases an annuity that pays for his or her share of Social Security retirement benefits, the worker could withdraw all or part of any remaining money in the PRA or leave it in the account and allow it to grow. Upon the worker's death, the remaining money could be left to a surviving spouse, grandchild, or any other beneficiary.
Conclusion
Failing to utilize Social Security PRAs' full potential cheats future generations. Social Security reform should be about much more than just reducing the system's coming financial problems. Giving workers additional control over their retirement future and ensuring that the system is flexible enough to meet their individual needs will pay major dividends for families and society. Money in those nest eggs would remain in the community and would provide new opportunities for local people. Rather than depending on Washington and its priorities, PRA nest eggs would allow local people to improve their lives and those of their neighbors. The ability to create a nest egg should not be limited to the wealthy. Every American deserves the choice of building a family nest egg that could be used to improve retirement or enable his or her family to break out of poverty.
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. Heritage Foundation intern Kyle Nasser compiled the appendices.

Appendix 1
How Today's Workers Could Build a Nest Egg with a PRA

Today's moderate-income and low-income workers could build a nest egg under Social Security reform according to the CDA report. The 12 case studies listed in Table 1 cover workers born between 1960 and 1976, who would already be working when a system of PRAs is hypothetically established in 2003. Workers who are already in the workforce when PRAs are established would find building a nest egg more difficult because they would have less time to invest. The fact that all of the examples in the CDA study succeed in building a nest egg shows the program's immediate value. These benefits will only grow larger for workers who have PRAs for their entire careers.
Each case study shows two examples of the nest egg that the worker or couple could produce. The first number is the amount that workers would have remaining after using a portion of their PRA to finance a part of their monthly Social Security benefits. This is money that would be immediately available to them for whatever purpose they wish. The second number is the amount they could leave to their heirs at their death if they leave the remainder invested. The second number is usually significantly larger because the money remains invested for an additional decade or more. The study assumes that this gross amount will be divided equally among three heirs.
All amounts are expressed in constant dollars that eliminate artificial growth due to inflation.



Appendix 2
Results for the Third Generation
Social Security PRAs would provide workers with an even larger family nest egg once the accounts are available for an entire career. They reach even larger amounts when the workers' own contributions are supplemented by sums inherited from other family members. The 12 case studies listed in Table 2 examine the grandchildren of the first-generation examples listed in Table 1. These cases mirror those of the first generation with one key change: All of these examples chose to open a Social Security PRA on the day they entered the workforce. Otherwise, each worker has the same income level--and the same employment gaps for raising children at home--as the example of the same number from the first-generation cases. Each case also has the same life expectancy as the first-generation case, with the exception of the two first-generation males who die at age 55 before they can retire. In both cases, their third-generation heirs live a full life and reach retirement age.
Each of the third-generation workers is assumed to inherit one-third of the amount that his or her grandparents had remaining in their family nest egg at the time of their deaths. Table 2 shows the effect on the grandchild's PRA if the worker: (1) invests 100 percent of the inheritance in his or her PRA; or (2) spends the entire inheritance.


1. William W. Beach et al., "Peace of Mind in Retirement: Making Future Generations Better Off by Fixing Social Security," Heritage Foundation Center for Data Analysis Report No. CDA04-06, August 11, 2004.
2. Calculated by The Heritage Foundation's Center for Data Analysis using data from The Board of Governors of the Federal Reserve System, "2001 Survey of Consumer Finances," at federalreserve.gov/pubs/oss/oss2/2001/scf2001home.html (August 2, 2004). In this analysis, any major inheritance, gift, or bequest is considered an inheritance. Income figures represent adjusted gross income.
3. For the purposes of this study, low income is defined as annual earnings of $9,280 (in 2004 dollars), while moderate income is defined as annual earnings of $25,417.
4. For workers who never marry, their PRAs are left to grandnieces or grandnephews. Of course, the money could just as easily be left to the workers' children as to grandchildren, but they would likely be at the middle of their working lives (or later) when they received the money. Assuming that the grandchildren inherit money in a PRA, the CDA study shows the maximum amount that a combination of inherited money and the worker's own PRA could reach.
5. James M. Poterba, "Annuity Markets and Retirement Security," presentation at the Third Annual Conference of the Retirement Research Consortium, May 17, 2001, at www.mrrc.isr.umich.edu/conferences/cp/cp01_poterba.pdf (January 26, 2004).
6. Olivia S. Mitchell, "Developments in Decumulation: The Role of Annuity Products in Financing Retirement," Pension Institute Discussion Paper PI-0110, June 2001, p. 26, at www.bbk.ac.uk/res/pi/wp/wp0110.pdf (January 26, 2004).
7. Social Security Administration, "Chile: Chile's Recent Pension Reform, Passed in February, Changes the Way Retirement Annuities Are Sold, Creates a New Type of Annuity, and Makes It Harder to Retire Early," International Update: Recent Developments in Foreign Public and Private Pensions, March 2004, pp. 2-3, at ssa.gov/policy/docs/progdesc/intl_update/2004-03/2004-03.pdf (August 2, 2004).
8. Edward N. Wolff, "Inheritances and Wealth Inequality, 1989-1998," The American Economic Review, Vol. 92, No. 2 (May 2002), p. 263.
9. Gautam N. Yadama and Michael Sherraden, "Effects of Assets on Attitudes and Behaviors: Advance Test of a Social Policy Proposal," Washington University Center for Social Development Working Paper No. 95-2, 1995, p. 8, at gwbweb.wustl.edu/csd/Publications/1995/wp95-2.pdf (January 26, 2004). As measures of personal behavior, Yadama and Sherraden used indices for prudence, efficacy, horizons, connectedness, and effort (based on longitudinal surveys developed by the Survey Research Center of the University of Michigan). They apply regression analysis to test three hypotheses: (a) More asset holding causes increases in the indices; (b) more income causes increases in the indices; and (c) higher values of the indices cause more asset holding. They find that the data best support the first hypothesis (pp. 11-13).
10. Congressional Budget Office, "Economic Stimulus: Evaluating Proposed Changes in Tax Policy," January 2002, p. 12, footnote 7, at ftp.cbo.gov/32xx/doc3251/FiscalStimulus.pdf (January 26, 2004). "Economic theory and empirical evidence suggest that workers bear much of the employer's portion of the payroll tax through lower wages and reduced fringe benefits. If the employer-paid portion of payroll tax receipts is counted as the contribution of the worker, roughly 80 percent of taxpayers pay more in payroll taxes than in income taxes." The 80 percent figure includes payroll taxes for the other two main programs of Social Security--Disability Insurance and Hospital Insurance.
11. Calculations by Center for Data Analysis at The Heritage Foundation using the Social Security Calculator, located at www.heritage.org/research/features/socialsecurity (July 20, 2004).
12. The two cases are Helvering v. Davis (1937) and Flemming v. Nestor (1960).
13. Stephen C. Goss, "Problems with `Social Security's Rate of Return: A Report of the Heritage Foundation Center for Data Analysis,'" Social Security Administration Memorandum, February 4, 1998.
14. This plan is intended to illustrate how a PRA reform plan could create nest eggs and is not an endorsement by either the authors or The Heritage Foundation of any particular approach to establishing PRAs.
? 1995 - 2004 The Heritage Foundation
All Rights Reserved.

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Health, Inequality, and the Scholars
By Nicholas Eberstadt, Sally Satel, M.D.
Posted: Monday, September 20, 2004
ARTICLES
The Public Interest
Publication Date: September 1, 2004
Few would take exception to the idea that an improvement in the material well-being of the poor would enhance not only their living standard but their health levels as well. A number of influential recent studies, however, purport to show that inequality in income--not poverty per se--has detrimental health consequences. This "inequality hypothesis" is meant to apply to everyone, regardless of wealth or social standing, and predicts that the risk of illness depends upon whether one lives in a society that is stratified or egalitarian. Thus, according to this hypothesis, while the poor may suffer the most from inequality, the better off and even the rich suffer as well.
This is a dramatic claim--and one with potentially far-reaching implications. It extends far beyond the current paradigms upon which contemporary Western social welfare policy is premised. Current welfare policy, after all, posits that overall national health can be improved by transferring resources from society's more affluent members to its poorest and most vulnerable groups. The inequality thesis, by contrast, would seem to suggest that simply taking wealth away from the rich--and thereby reducing measured economic inequality--should in itself produce an improvement in national health. Indeed, the inequality thesis suggests that, all other things being equal, a cutback in the income of the well-to-do could be expected to improve the health status of the poor, and possibly the rich themselves--even if society were left with a lower average income level as a result of those cutbacks.
It is hard to overstate how quickly and thoroughly the inequality hypothesis has become conventional wisdom among many medical sociologists and public health scholars. It is not confined to the radical left. In Unhealthy Societies, for example, Richard G. Wilkinson of Nottingham University Medical School argues that income inequality is "one of the most powerful determinants of health" and "the most important limitation of the quality of life in modern societies." The academic world is by no means immune to fads, but the sudden popularity of the inequality hypothesis--in schools of public health, scholarly journals like the American Journal of Public Health, institutions such as the American Public Health Association, and health philanthropies like the Robert Wood Johnson Foundation--is quite extraordinary.
Additionally, the notion that income inequality is bad for health has recently surfaced in political discussions, taxpayer-funded policy research forums, and the popular media. British Prime Minister Tony Blair has stated, "There is no doubt that the published statistics show a link between inequality and health." The World Bank has dedicated an entire web page to the inequality hypothesis. In the United States, the National Institutes of Health, Centers for Disease Control and Prevention, and reporters for the New York Times and Washington Post, among others, have given favorable coverage to the subject. The hypothesis has become accepted wisdom among public health researchers and epidemiologists.
But the enthusiasm of many researchers and observers goes well beyond what might be warranted by the weight of the evidence alone. A very persuasive, if less publicly heralded, body of scholarship that challenges the inequality hypothesis is currently emerging. To get a better sense of this important debate, it is useful to examine both sides of it--the evidence adduced to support, refute, and qualify the inequality hypothesis. In addition, it is necessary to evaluate the study methodologies and data interpretation, as well as policy recommendations, of both sides. Against this background, it appears that the evidence and arguments for the inequality hypothesis are wanting in many respects, and that a number of influential scholars have jumped to policy conclusions on the basis of ideologically appealing, but technically dubious, findings.
Origins of the Hypothesis
The income inequality hypothesis originated as an ad hoc explanation for the repeated observation that income inequality (the extent to which wealth is concentrated or dispersed over a population) is associated with mortality levels: The greater the degree of inequality, the higher the mortality levels in that population. From correlation was assumed causation. Antecedents of this line of academic thinking can be traced back at least to the 1970s, when income inequality emerged on the margins of the public health literature in the form of neo-Marxist jeremiads.
This line of argumentation was particularly associated with Johns Hopkins Professor Vicente Navarro and the publication he edited, the International Journal of Health Services. Navarro and his colleagues maintained that the capitalist system necessarily generated both economic inequality and ill health, and that it did so in rich and poor countries alike. This initial neo-Marxist thesis linking capitalism, inequality, and disease, however, was fundamentally nonquantitative, and it relied more on assertion and Marxist scripture than careful data analysis to bolster its case. It would take almost two decades for some of Navarro's tenets to be tested in a more quantifiable manner by more mainstream scholars.
One of the earliest studies arguing for a causal link between health and income inequality appeared in the British Medical Journal in 1992. In "Income Distribution and Life Expectancy," Richard Wilkinson of the University of Nottingham Medical School compared nine Western industrialized countries and reported that those with less income inequality had populations with longer life expectancies. Wilkinson has been the most vocal proponent of the so-called social-production theory of health. Since the appearance of his seminal article, well over two dozen research studies and commentaries confirming the income inequality hypothesis have been published.
Wilkinson and other supporters of the hypothesis argue that health is one of the most sensitive indicators of the social costs of income inequality. Beyond a relatively modest level of economic development, they argue, further advances in standard of living do not seem to matter much, and the linear relationship between life expectancy and income breaks down. This observation prompted Wilkinson to ask the following question: How can one country "be more than twice as rich as another without being any healthier," particularly when it comes to life expectancy?
The many lines of exploration that have been pursued to answer this question assume two main types: aggregate data studies and individual-level analyses. (A third type of study exists--observational examinations of human and animal social hierarchies--but this is not the place to discuss these.) These studies, which help establish patterns of disease and health status in relation to social position, form the basis for speculation about the mechanisms by which environmental factors create stress or lead to behaviors that produce adverse health consequences.
Aggregate Data Studies
This first type of study examines correlations between aggregate levels of health (that is, the mortality of a specified population) and income inequality. These aggregate data studies purport to offer evidence that inequality affects all members of a group, not just the poorest ones. One of the earliest studies of this phenomenon was "Income and Inequality and Determinants of Mortality," conducted in 1979 by G.B. Rodgers of the International Labour Organization. Rodgers examined income dispersion applying the Gini coefficient, a measure of income distribution, to data from 56 rich and poor countries in the context of three health measures: life expectancy at birth, life expectancy at age five, and infant mortality rate (deaths in the first year of life per 1,000 live births). He concluded that the "difference in average life expectancy between a relatively egalitarian and a relatively inegalitarian country is likely to be as much as five to ten years." In the 1980s, a handful of studies used the Gini coefficient in analyzing the relationship between health measures and found similar results.
It is important to note that Rodgers posited at first only a correlation, not a causal relationship, between health and income. But in his 1992 study, Wilkinson suggested a causal relationship. He examined Organization for Economic Cooperation and Development member countries using data from the Luxembourg Income Study and found a high correlation between life expectancy and the proportion of income earned by the bottom 70 percent of the population.
Wilkinson concluded that differences in per capita gross national product (GNP) alone could not explain more than 10 percent of the variance in life expectancy. He noted further that mortality rates are not related to per-capita economic output but rather to the scale of economic inequality in each society. The association was unaffected by adjustments made for average absolute income level and remained evident across a range of decile shares of income distribution. Subsequent to Wilkinson's report, a series of crossnational studies have demonstrated that the more even the distribution of income, the higher the life expectancy.
Robert J. Waldmann of Columbia University complemented these findings by using another measure of inequality. In a 1992 article for the Quarterly Journal of Economics he examined pairs of countries in which the poor (defined as the lower 20 percent of household income distribution) had equal real incomes but where the rich (defined as the top 5 percent of the household income distribution) in one country were much wealthier than in the other. He found that the infant mortality rate was higher in the half of the pair in which the rich households were wealthier. He tested for explanations other than income, including the degree of urbanization of the households, the literacy of the mothers, and access to medical services. Yet he found that none adequately accounted for the positive association, likely causal in his view, between the incomes of the rich and infant mortality.
In their book Is Inequality Bad for Our Health? Harvard researchers Norman Daniels, Bruce Kennedy, and Ichiro Kawachi provided further evidence in support of the inequality hypothesis. The authors highlight seeming paradoxes such as the fact that equally poor countries such as Cuba and Iraq do not have similar life expectancies--Cuba's reportedly exceeded that of Iraq by about 17 years. Conversely, low GDP-per-capita Costa Rica and the high GDP-per-capita United States were said to have similar life expectancies. And comparably wealthy countries with more equal income distributions, such as Sweden and Japan, had higher life expectancies (by two to five years) than the United States. The authors conclude that "the health of a population depends not just on the size of the economic pie but on how the pie is shared," adding that "the degree of relative deprivation within a society also matters."
Numerous studies of the U.S. population have examined the association between income inequality and aggregate health measures at the state level. Daniels, Kennedy, and Kawachi found that, in the United States between 1980 and 1990, states with the highest income inequality showed slower rates of improvement in average life expectancy than did states with more equitable income distributions. They concluded that "the more unequal a society is in economic terms, the more unequal it is in health terms." George Kaplan of the University of Michigan and his colleagues in a recent study found a strong correlation between inequality and death rates. In particular, the authors discovered that income inequality was significantly associated with a higher incidence of age-specific mortality, low birth weight, homicide, violent crime, work disability, welfare receipt, smoking, expenditures on medical care, unemployment, and low educational attainment. What is more, all these measures worsened with increased income dispersion.
Individual-Level Analyses and Questions of Causation
The second type of analysis measures the effect of income inequality on health after controlling for the effects of individual income. These individual-level analyses ask the following question: Can the observed correlation between inequality and health be explained by the intervention of other variables, or is there truly a causal relationship between the two? When this type of analysis is considered, the association between income inequality and health outcomes does not appear as secure as its proponents suggest.
Questions remain about the extent to which statistical artifact has been mistaken for real effect. In his 1998 article in the British Medical Journal, Hugh Gravelle of the University of York asserts that there may be a very simple explanation for some, or all, of the reported associations between inequality of income and population health used to support the relative income hypothesis. "A positive correlation between population mortality and income inequality can arise at the aggregate level even if inequality has no effect on the individual risk of mortality," he stated. "Thus, we do not need the relative income hypothesis to explain the observed associations between population health and income inequality--the absolute income hypothesis will serve."
International comparisons show that health improvements become smaller and smaller with increasing wealth. Thus the relationship between per-capita income and national health--however it is measured--should not be expected to be linear. To the contrary, as Jennifer Mellor of the College of William and Mary and Jeffrey Milyo of the University of Chicago argue, the function is one in which we would expect to see "diminishing returns" to average income. Furthermore, they continue, health levels should depend not only on average income levels but also on income distribution. This is because information on income distribution serves as a proxy for the number of persons at lower levels of income. Consequently, Mellor and Milyo conclude, aggregated studies do not offer convincing evidence on this matter. Harold Pollack of the University of Michigan puts it another way:
Money matters near the bottom of the distribution and may not matter at all for many outcomes when one exceeds the median. Controlling for the median income, then, any income dispersion measure is highly correlated with the percentage of the population that is under the poverty line.
The influence of particular variables is significant as well. For example, when individual characteristics replace aggregate-level mortality in the analyses, and when different years are examined, the relationship between health and income inequality often disappears. When the strong regional patterns in health outcomes that exist across the United States are ignored, spurious associations between inequality and health may result. Some, like Pollack, question the validity of one of the aggregated econometric measures used in most analyses: "Cross-sectional regressions that use inequality measures such as Gini are virtually uninterpretable."
There are some glaring exceptions to the health and income inequality pattern. In Denmark, for example, where per-capita income is similar to that of the United States, but where income dispersion is lower, life expectancy is also slightly lower than in the United States. Thus the important but unanswered question remains: If an underlying relationship between deprivation and poor health does indeed exist, is reported annual dispersion of a society's income the most appropriate index for describing inequality in that population?
Milyo and Mellor have questioned whether the correlation between inequality and health is in fact not causal but spurious. There are three possible interpretations of a correlation between variables A and B: either A causes B, B causes A, or A and B are independent of one another but both related to a third variable. Taking into account the well-established relationship between health and material well-being and social status, Milyo and Mellor point out obvious advantages that come with wealth: Well-off people can afford better health insurance and higher-quality care; they can demand better work environments, afford safer cars, and live in less polluted and less crime-ridden neighborhoods. In this way, being richer can make one healthier.
Yet consider the reverse dynamic: Being healthy can also make one better off. Poor physical or mental health can influence an individual's ability to work for long hours or at all, thus limiting his income. This is known as the "healthy worker effect." What follows could lead to further health impairment because the worker has less money with which to purchase health-enhancing goods and protections. The cumulative wear and tear on such individuals, coupled with whatever psychic stress they experience as a result of deprivation of social status, may be considerable.
Additionally, so-called third factors can account for the habits and limited opportunities that often lead to poorer health. Sedentary lifestyle, obesity, high-fat diets, aversion to medical care, and risky behavior, which typically underlie many of the differences in health status between the less wealthy and the better off, may well be the product of educational level. Better-informed people know about the importance of exercise, screening tests for cancer, and a healthy diet. They are more confident when interacting with physicians and better at negotiating bureaucracies (for example, HMOs). Personal characteristics that tend to be associated with greater life success, such as prudence, perseverance, and an ability to delay gratification, are also likely predictors of good health or competence in managing illness. Indeed, the substantial association of health with certain measures of human agency raises the question of whether income inequality itself has any appreciable direct effect on mortality. The association may instead reflect the effects of other factors--education in particular--that are also related to mortality.
Indeed, in a recent study in the British Medical Journal Andreas Muller of the University of Arkansas tested whether the relationship between income inequality and mortality in the United States is a consequence of different levels of formal education. He conducted state-by-state analyses of age-adjusted mortality from all causes and three independent variables: the Gini coefficient on income in 1989 and 1990, per-capita income from those years, and the percentage of people older than 18 who did not complete high school. An income inequality effect was found, but it disappeared when the percentage of people without a high school diploma was added to the regression analysis. Muller concluded that the lack of a high school education accounts for the income inequality effect and is a powerful predictor of mortality variation across states. He writes, "The physical and social conditions associated with low levels of education may be sufficient for interpretation of the relationship between income inequality and mortality." These conditions likely include the risk of occupational injury, the inability to attain protective goods and services, and cigarette smoking.
Ecological Bias (in Theory)
From a methodological standpoint, most quantitative research purporting to support the inequality thesis is potentially compromised by a problem statisticians designate as "ecological bias." Ecological bias arises when "ecological correlations"--that is to say, correlations witnessed in aggregated data--differ from the underlying correlations that would be observed if one were examining individual data.
Ecological bias is a particular risk in studies of the inequality thesis for a very simple reason: The relationship between income and mortality is highly unlikely to be linear. In general, an individual's health will not be doubled by a doubling of income--and multiplying his or her income by a factor of 10 will not correspondingly reduce mortality odds or health risks by an order of magnitude. To the contrary, the relationship between income and mortality in almost all populations seems to be curvilinear. That is to say, additional increments in income correspond to further improvements, albeit steadily diminishing improvements. Recent international data, indeed, suggest that a doubling of a country's per capita income is associated with an absolute increase in life expectancy at birth of just about six years.
Consider what this curvilinear correspondence between income and mortality means for aggregated data--and for measurements to test the inequality hypothesis. Even if increased income dispersion has no negative impact whatever upon health, the society with the higher level of income inequality will, all things being equal, appear to have an "unexpectedly" short life expectancy.
A simple hypothetical example illustrates the problem. Suppose we invent a country called "Equalia," with a population of 100,000. Every person in Equalia earns the national median income of $50,000 a year, and every person lives exactly 75 years. In this country, then, life expectancy is 75, average per capita income is $50,000, and the Gini coefficient of income inequality is exactly zero (on a possible scale of 0 to 100 percent).
Now suppose an invented individual--call him "Bill Gates"--suddenly moves to Equalia. Bill's income is $5 billion a year, and his life expectancy (thanks in part to the superb medical treatment he is able to afford) is exactly 100 years. Suppose further that Bill's immigration leaves everyone else's income and health totally unaffected.
What will the aggregated data show? Before Bill came to Equalia, life expectancy was 75 years; after he moved in, it was ever so slightly higher. Before he moved in, average income per household was $50,000; after he arrived, average income was virtually twice as high--essentially, $100,000 per household. And whereas the Gini coefficient for Equalia's income distribution was zero before Bill's arrival, post-Bill Equalia would have a Gini coefficient of nearly 50. In other words, half of the country's income would be in Bill's hands, and the rest would be evenly distributed among everyone else.
By the sort of analysis the inequality-thesis school favors, post-Bill Equalia would be placed on a scatter plot along with other populations and compared in terms of mortality (or life expectancy), income, and income distribution measures. Of course, life expectancy in the country would be almost identical before and after Bill's move. But post-Bill Equalia's income level would be far higher than that of pre-Bill Equalia, and the country's income distribution would be more uneven. The correspondence between life expectancy and income in post-Bill Equalia would look much less favorable than in pre-Bill Equalia. Indeed, once the statistics are crunched, post-Bill Equalia might be seen as "suffering" from a national life expectancy fully six years lower than might have been expected on the basis of its income level alone. Further use of regression analysis could produce results that would demonstrate that income inequality in post-Bill Equalia had cost the nation years of lost life expectancy (against levels otherwise predicted). Yet in our hypothetical example, not a single household in Equalia had its health or income affected by Bill's entry into the country. The adverse relationship between inequality and health suggested by nation-level data in post-Bill Equalia is entirely spurious--a consequence of ecological bias, pure and simple.
Ecological Bias (in Practice)
It is not only in the hypothetical case of Equalia that "ecological correlation" may misrepresent the true correspondence between health risks and economic stratification. Ecological fallacy may also undermine conclusions from previous studies supporting the income inequality hypothesis. It is therefore important to control for confounding at the individual level.
To that end, in a 1997 study appearing in the British Medical Journal, Kevin Fiscella and Peter Franks of the University of Rochester examined whether the relationship between income inequality and mortality observed at the population level may simply represent inadequately measured rates of income differences at the individual level. Fiscella and Franks used demographic and mortality data from 1971 and 1987 from the first National Health and Nutrition Examination Survey and related follow-up surveys. To measure income inequality, the researchers used an index that estimates the proportion of total income earned by the poorer half of the population in an area. The authors found that aggregated data replicated earlier findings that supported the income inequality hypothesis. After they adjusted for individual household income, however, no significant relation between income inequality and mortality was evident. They concluded that "income, as a measure of access to resources, and not relative inequality, better explains the relation between income and mortality."
The fact is, few studies explicitly test whether inequality has a more pronounced effect on the health of the poor. In those that do, the results are mixed at best. Ellen Meara of Harvard University examined the relationship between various measures of household income inequality on infant mortality and low birth weight. She estimated the effects of inequality with and without state-specific effects--that is to say, taking into account the possibility that particular states might have especially good, or poor, health outcomes due to some special circumstance. After controlling for household income and other maternal characteristics, Meara found no significant correlation between income inequality and adverse birth outcomes among poorer women.
Mellor and Milyo also explicitly examined whether inequality has a particularly strong effect on poorer individuals. They controlled for the possibility that particular regions of the country might have characteristically better or worse health than other regions--possibly due to such factors as local dietary or behavioral habits that could be spuriously correlated with income inequality-- and explored whether the relationship between health and income inequality is robust across geographical units. They found that statistical association between income inequality and health outcomes is greatly attenuated once controls are added for individual income. In fact, when Mellor and Milyo controlled for variables such as education and race, they found a weak inverse relationship--that is, the more dispersed a state's income, the less healthy the individuals.
Little research is explicitly devoted to testing the theory that perception of relative deprivation leads to illness or foreshortened lifespan. Angus Deaton and Christina Paxson of Princeton University attempted to do this by measuring inequality within birth cohorts rather than across geographical regions. The authors reasoned that people may be more likely to appraise their social status differently if they compare themselves to others at the same stage of life rather than with their neighbors. They found no robust association between inequality and mortality when inequality is measured within birth cohort. In fact, in some specifications, the association was the opposite of what the income inequality hypothesis would predict.
Social Capital As a Causal Mechanism?
Because a clear causal relationship between economic inequality and health cannot be identified, much of the inequality thesis literature to date is devoted to determining a possible intermediary factor that links the two. The main intermediate variable is surmised to be "social capital," a concept that describes the pattern and intensity of networks among people with shared values. It gauges civil cohesion through a consideration of citizenship, neighborliness, trust, community involvement, social networks, and political participation (among other factors). Proponents of the hypothesis claim that inequality causes people to perceive their neighbors as more alien or less trustworthy than would be the case in an egalitarian society. As a result, citizens are less concerned about the welfare of their neighbors, and a decline in public health results.
Measuring social capital, however, is exceedingly difficult. Alternative indexes can produce contrasting or even contradictory readings for a given society. For this reason, the claim that social capital is the mechanism by which economic inequality adversely affects human health is problematic.
It is true that some data suggest a relationship on the individual level between health and civic cohesion. Numerous epidemiological studies have shown that people who are socially isolated die at two to three times the rate of well-connected individuals. But what about entire, socially isolated communities? If populations are not well integrated socially, as reflected in a hierarchical structure that highlights real or perceived differences in interests across individuals, what effect might this have on the health of the group?
Daniels, Kennedy, and Kawachi were among the first to address this question. They conducted a cross-sectional study of 39 states in which they examined the relationship between social capital and mortality. The aim was to estimate state variations in group membership and levels of trust.
They quantified social capital by considering the per-capita number of groups and associations to which residents of each state belonged. They also weighted responses to several items on the General Social Survey conducted by the National Opinion Research Center. The first survey item was a measure of "perceived lack of fairness," which was measured by responses to the following question: "Do you think most people would try to take advantage of you if they had the chance, or would they try to be fair?" The second item concerned "social mistrust" and was measured by responses to the question, "Generally speaking, would you say that most people can be trusted or that you can't be too careful in dealing with people?" So was the third: "Would you say that most of the time people try to be helpful, or are they mostly looking out for themselves?"
For each state, the authors calculated the percentage of respondents who agreed with the first part of each statement and found an association between social capital and mortality. (The authors acknowledge that their model did not consider the full range of factors that might influence income inequality and social capital, and also recognize the inability to discern the direction of causality.)
Based on their findings, Kawachi and his colleagues propose that income inequality affects health by inhibiting the formation of social capital, which in turn undermines civil society. It erodes social cohesion, as indicated by higher levels of measured social mistrust, and reduced participation in civic organizations. Lack of social cohesion, they argue, leads to a decline in engagement in activities and institutions such as voting, serving in local government, or volunteering for political campaigns. Low levels of engagement, in turn, undermine the responsiveness of government when addressing the needs of the worse-off. The authors conclude: "States with the highest income inequality, and thus the lowest levels of social capital and political participation, are less likely to invest in human capital and provide far less generous safety nets."
But even if there proves to be a correspondence between health and social capital, it does not necessarily follow that economic inequality per se has a direct bearing on health prospects. If that were true, a causal relationship would have to exist between inequality and social capital formation. Available evidence, however, suggests that the statistical association between economic inequality and social capital is quite tenuous.
This problem is indicated in Francis Fukuyama's 1995 study Trust: The Social Virtues and the Creation of Prosperity. In the course of that work, Fukuyama describes and contrasts countries and areas that he designates as "high trust" and "low trust" societies. In Fukuyama's estimate, Germany, Japan, and the United States are countries with high levels of social capital, while France, Italy, Hong Kong, and Taiwan are settings where the endowment of social capital is noticeably lower.
As official economic statistics illustrate, however, no obvious correspondence exists between income inequality and social trust among Fukuyama's exemplars. It is true that economic inequality (as measured by the Gini coefficient) is on average somewhat higher in the "low trust" than the "high trust" societies identified. But income inequality would also seem to be greater in "high trust" Germany than in "low trust" Italy. Income distribution would appear to be distinctly more skewed in "high trust" America than in either "low trust" France or "low trust" Taiwan. And within the "low trust" group, Italy's measured level of income inequality is barely half that of Hong Kong. Indeed, according to World Bank data, outside of Scandinavia and the former Soviet bloc, no country in the world today reports a more even distribution of national income than does "low trust" Italy. Given the weak empirical foundations for any argument linking inequality and social capital, the hypothetical mechanism by which inequality would have an impact on health would seem to remain just that--merely hypothetical.
Nonreproducible Results
The inequality hypothesis has become an increasingly influential school of thought within public health literature. But when exploring the claims its proponents advance, the evidence they cite in their favor, and the methodologies underlying their arguments, it becomes clear that this is a theory built on stilts. How has a notion with such questionable empirical documentation--research relying far too often on limited or unrepresentative data sets, hazily expounded causality, and elementary econometric fallacies--acquired so much respect within the academy and so much authority in policy circles?
This troubling question becomes even starker when one considers that some of the important studies adduced in support of the inequality hypothesis appear to be difficult to replicate with different but analogous sets of data. The essence of the scientific method is to frame and operationalize a hypothesis whose predictions comport with observable results in a consistent manner. If the hypothesis is valid and testable, its result should be generally reproducible, rather than unique to a particular experiment. But key facets of the evidentiary foundation for the inequality hypothesis fail this basic test.
Robert Waldmann's influential 1992 study on international infant mortality rates and economic inequality is a case in point. Although Waldmann himself has not been an exponent of the inequality thesis, his econometric analysis has become staple fare for those who argue that inequality has adverse effects on public health. Using World Bank per-capita income and income distribution data from the 1960s and 1970s for a sample of 57 countries, 41 of which he categorized as "developing," Waldmann concluded that "infant mortality appears to be positively related to the incomes of the rich (the upper 5 percent of the income distribution) when the incomes of the poor (the lowest 20 percent) are equalized among countries." He took this result to be so robust that he described it as a "striking empirical regularity."
If this is indeed as striking an empirical regularity as he claims, it would be reasonable to expect a similar result using larger and more recent World Bank data. Because such data are presently available, we thought it would be interesting to repeat Waldmann's analysis using these new data and the same regression equations that generated his striking and thought-provoking conclusions. As it turns out, the "striking empirical regularity" that Waldmann found in 1992 is by no means evident in international data from the mid 1990s.
For the sample of all countries, rich and poor, recent data affirm Waldmann's finding of a strong and statistically significant relationship between infant mortality and the per-capita income levels of the middle-income grouping. This is hardly a surprising result, insofar as this middle group accounts for the overwhelming majority of each country's population, and also presumably the greatest share of every country's births and infant deaths. But where Waldmann uncovered a powerful and significant positive relationship between infant mortality and the share of income accruing to the top income grouping, our analysis finds a negligible association--less than one hundredth the scale of Waldman's. This association, moreover, could be either positive or negative, given the weak statistical relationship itself and the large margins of error involved.
Some of our other results appear even more incongruent with Waldmann's. When just the income level of the poor and the income share of the rich are used to predict infant mortality, Waldmann found a strong and positive association between inequality (so measured) and the infant mortality rate. But for the mid 1990s, using a substantially larger data set, that relationship is weak and the coefficient is negative. This is true for a sample including both rich and poor countries, and for the developing countries by themselves. What does that mean? Plainly put, this purportedly "striking empirical regularity" of the supposedly perverse relationship between income concentration and infant mortality is rather less "striking"--or "regular"--than proponents of the inequality hypothesis themselves apparently understand. Based on these larger, more recent data samples, the notion that a country's infant mortality rate is directly influenced by its economic elite's share of total income is a proposition that plainly cannot be generally substantiated.
Faith Factor
Considering the empirically questionable nature of the data and methodology used to support the inequality hypothesis, its widespread popularity must therefore be explained in other, nonempirical terms. One reason the hypothesis may have proved so compelling in academia, as well as in the policy world, is that it points toward a social reform long favored by radical egalitarians: the redistribution of wealth. In view of the new and now well-documented activist mission of many schools of public health--that is, to promote "social justice"--it is not surprising that public health circles might react enthusiastically to a thesis that would seem to support their own preferences for an expansive social and economic policy agenda.
It seems there is a profound, almost elemental appeal to the basic premises of the hypothesis, and, most especially, to its implicit practical corollary--namely, that by restructuring society and reducing inequality, the health chances and life prospects can be improved for all. This elemental theme, however, is hardly new to social or political discourse. In an important sense, the theme is as old as the concept of modernity itself. In one form or another, versions of the same romantic, utopian call have been heard ever since writers first began to imagine that we could improve humanity by purposely refashioning the sort of society that human beings inhabited. Like the Marxist and neo-Marxist ideologies to which it is related, the inequality hypothesis is best understood as a creed or faith. To describe it as a scientific hypothesis is a misnomer; it is more accurately a doctrine in search of data.
Nicholas Eberstadt is the Henry Wendt Scholar and Sally Satel is a resident scholar at AEI.

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A Prescription for Health-Care Reform
By R. Glenn Hubbard
Posted: Thursday, September 16, 2004
ARTICLES
Business Week
Publication Date: September 20, 2004
An "Ownership Society'' agenda has taken center stage in President George W. Bush's agenda for a second term, with proposals for Personal Accounts in Social Security, expanded incentives to save for retirement, and Personal Reemployment Accounts to aid workers in finding a new job. But a central plank of this agenda, and one that can be enhanced to improve markets for health care, is already law: the Health Savings Accounts (HSAs) passed in the recent Medicare reform.
HSAs, which let individuals set up tax-preferred accounts to pay for health care--so long as they buy high-deductible health insurance--allow citizens, as the President says, to "own their own health care.'' Under current law, people can use pretax dollars to fund a deductible of at least $2,000 for a family and insurance pays expenses above that amount. HSAs can also shore up troubled Medicare and mimic the economic advantage of the Social Security Personal Accounts.
HSAs help make health-care markets work better by removing the tax bias toward third-party payments.
Patient-centered health care is a hard concept to implement when direct patient payments make up only $1 out of every $6 of expenditures. With insurers paying for even routine care, consumers lack incentives to shop for low-cost, high-value care. Middle-income families receive a huge tax discount by buying employer-sponsored insurance: A household earning $50,000 gets a subsidy equal to its combined marginal income and payroll tax rate of about 40%.
In the short run, markets cope with this situation by shifting and managing costs. Small employers will probably drop coverage. In the long run, the problems will lead to calls for more government intervention--bringing price controls and a system responding slowly to innovation.
But a simple change can improve HSAs as a tool of health policy and the Ownership Society: Let all Americans deduct expenditures on insurance and out-of-pocket expenses as long as they purchase at least insurance against catastrophes. That is, people already covered by employer plans could deduct out-of-pocket expenses. The self-employed with insurance may deduct out-of-pocket expenses. Those now without coverage may deduct both insurance premiums and out-of-pocket expenses if they purchase an individual plan.
The change would level the playing field between medical care through employer insurance and direct out-of-pocket outlays. Acquiring insurance would be encouraged since the tax break is available only with insurance. Importantly, the tax-code bias for high-cost, low-deductible insurance would be removed, allowing for deductibility of out-of-pocket expenses. The tax change reduces the bias against buying insurance on your own, either through your employer or individually.
Such an enhancement of HSAs raises two policy questions. First, as expanded HSAs make individual coverage more attractive, would employer-based insurance unravel? No. Expanded HSAs just remove much of the difference between buying insurance through one's employer or on one's own.
Second, by making more out-of-pocket outlays deductible, wouldn't an enhanced HSA raise costs? No. People will shift to plans with higher deductibles and co-insurance, reducing health-care utilization. John F. Cogan, Daniel P. Kessler, and I have estimated the net decline in spending at more than $65 billion a year. That drop is achievable without price controls.
But resources no longer spent on health would flow to other, taxable activities: Wages will climb by the amount of the decline in employer premium payments. Besides putting cash in workers' pockets, new income and payroll tax collections will rise enough to cover much of the revenue loss from tax deductibility. HSAs also offer a vehicle through which health assistance to low-income households could be distributed, helping families buy insurance in private markets and save for old-age medical expenses.
Finally, HSAs, and the ownership agenda they represent, are a stark contrast to the vision offered by John F. Kerry. The Kerry plan would spend $1 trillion over 10 years, expanding government's role in health care. This requires more than the tax increase on high-income earners that Kerry has outlined. And carrying the debate to shoring up Medicare, the Senator's "solve it with tax increases'' theme bodes ill for growth, and does little to put the consumer in the driver's seat.
To the patient and voter: Read the prescriptions carefully.
R. Glenn Hubbard is a visiting scholar at AEI.

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>> ARGENTINA

Argentina Must Implement IMF's Reforms If Recovery Is to Continue
Letter to the Editor
By Desmond Lachman
Posted: Monday, September 20, 2004
ARTICLES
Financial Times (London)
Publication Date: September 16, 2004
After all of Argentina's economic pain, one can understand Mr. Prat-Gay, Argentina's central bank governor, taking satisfaction from the stronger than expected bounce in the Argentine economy over the past two years. (How Argentina defied the analysts, September 14) However, one must wonder whether he does his country a service by insinuating that it can sustain that recovery without implementing the economic reforms being prescribed by the IMF and without normalizing its relationship with its external private creditors.
While noting Argentina's strong economic growth since 2002, Mr. Prat-Gay overlooks the many transitory factors that have supported that growth. These factors have included near record international grain prices, an undervalued exchange rate, a substantial domestic output gap, and record low international interest rates. Yet despite these favorable factors, the Argentine economy is yet to regain its pre-crisis 1998 level.
Mr. Prat-Gay also suggests that the Argentine financial system is on the mend as indicated by the rapid shrinking of non-performing loans and by a 40 percent increase in private credit. However, he does not remind us that private bank credit in Argentina is presently around 7 percent of GDP, or barely 40 percent of its pre-crisis level. Nor does he mention the remaining vulnerabilities of Argentina's banks or the far from completed IMF banking system reform agenda.
As Argentina uses up the economy's existing slack, maintaining satisfactory economic growth will require sustained investment and improved productivity performance. As the IMF does not tire of reminding us, this will require normalizing relations with international creditors, placing the public debt on a sustainable path, restoring a sound financial system and resolving the problems inhibiting investment by Argentina's utility companies. Rising to this challenge may not be quite as easy for Argentina as Mr. Prat-Gay seems to suggest.
Desmond Lachman is a resident fellow at the American Enterprise Institute.




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Permalink
Saturday, 18 September 2004


>> IRAN

IRAN:
Order Out of Chaos
Abbas William Samii
The mad, mad world of Iranian foreign policy.
Abbas William Samii is a Bernard M. Osher Fellow at the Hoover Institution and a regional analysis coordinator at Radio Free Europe/Radio Liberty. The views in this article are his own.
In recent months, the United States has repeatedly accused Iran of interfering in its neighbors' affairs--and Iran has repeatedly denied such claims. It might seem counterintuitive for Tehran to foment unrest on its eastern and western borders, but that is exactly what Washington accuses it of doing.
Some observers argue that because Iranian diplomats played a helpful role in the November-December 2001 meeting in Bonn that created a framework for a post-Taliban government, and because in April 2004 Iranian diplomats came to Iraq in an effort to reduce tensions there, it does not make sense for Iran to work against U.S. efforts now. If anything, the American elimination of the Taliban--with which Iran almost went to war in late 1998--and Saddam Hussein, whose 1980-88 war left some 200,000 Iranians dead, has greatly benefited Iran and contributed to its security.
In theory, Iran and the United States have similar interests in Afghanistan and Iraq. In practice, however, Iranian policy is based on a number of motives that are at odds with those of the United States, and, therefore, what is irrational from an American perspective is rational from an Iranian one. Furthermore, institutions and officials with sometimes conflicting interests have formal and informal roles in Iran's foreign policy process. The interaction of motives and actors seems chaotic, but understanding how this system works can help explain present Iranian actions and predict future ones.
Motives and Actors
Exporting its Islamic revolution was the dominant focus of Iranian foreign policy in the 1980s, with Tehran supporting Shia movements in Afghanistan, Bahrain, Iraq, Kuwait, and Lebanon. Revolutionary Islam continues to underpin the country's foreign policy; Article 3 of the Iranian constitution still states that in order to attain its objectives the country's foreign policy must be based on "Islamic criteria, fraternal commitment to all Muslims, and unsparing support to the freedom fighters of the world." And, according to Article 154 of the constitution, "[Iran] supports the rightful struggle of the oppressed people against their oppressors anywhere in the world."
By 1988, Tehran had recognized that this attitude had alienated it from the international community. Radicalism slowly gave way to pragmatism, geopolitics, and economics; factors such as nationalism and ethnicity also influenced policy. This meant that in the 1990s Iran improved relations with its neighbors across the Persian Gulf, did not make a substantive effort to influence political developments in Central Asia, and sided with Moscow in the Chechen conflict.
An exception to this pragmatic attitude is Iran's continuing support for terrorist organizations such as Hezbollah, Hamas, and the Palestinian Islamic Jihad. Even this can be considered pragmatic, if only from an Iranian perspective, because by supporting these groups Iran demonstrates commitment to an issue that has a regional appeal, rather than a Shia-specific one. Moreover, this issue appears to concern only the United States and Israel--two countries with which Iran does not have diplomatic relations.
The top actor in the foreign policy process is Supreme Leader Ayatollah Ali Khamenei, who under Article 110 of the constitution delineates state policies and is supreme commander of the armed forces. He appoints the chief of the General Staff of the Armed Forces, the Islamic Revolution Guards Corps (IRGC) commander, and the top commanders of the armed forces. The political-ideological bureaus in the military are linked with the leadership.
The 38-member Expediency Council advises the Supreme Leader and makes recommendations on state policies. Ayatollah Ali-Akbar Hashemi-Rafsanjani, who served as president from 1989 to 1997, heads this body.
The country's top foreign policy body is the Supreme National Security Council, which is chaired by the moderate president Mohammad Khatami. The IRGC and the Ministry of Intelligence and Security (MOIS) theoretically report to this council, but in reality they have a great deal of autonomy and deal with the more sensitive aspects of foreign policy. Their political rivals are the Foreign and Defense Ministries, which are more closely allied with the president.
It is noteworthy that when a delegation of Iraqi opposition figures, including Ahmad Chalabi of the Iraqi National Congress, visited Iran in January 2003, it did not meet with anyone from President Khatami's office or from the Foreign Ministry. Brandeis University professor Kanan Makiya, who was in that delegation, told the New York Times, "We're not involved with the Khatami group. They have absolutely no say over Iraqi affairs."
Institutions that are not directly part of the government also sway the foreign policy process. Informally, the foundations that were created partly through the post-revolution expropriation of the assets of the monarchy and wealthy Iranians are influential. The foundations get many state benefits, but they are not accountable to the elected government. The Imam Reza Shrine Foundation (Astan-i Qods-i Razavi), based in the northeastern city of Mashhad, could affect Iran's relationship with Afghanistan. The foundation controls the most important religious shrine in Iran, from which it derives its power and wealth. Over the last 25 years the income from pilgrims and donors has turned the foundation into a multimillion dollar enterprise; it runs auto plants, agricultural businesses, and many other enterprises, and it is worth an estimated $15 billion. The head of the foundation, Ayatollah Abbas Vaez-Tabasi, is a member of the aforementioned Expediency Council, as well as the Assembly of Experts, which supervises the Supreme Leader's performance.
Individuals also influence the foreign policy process. In a February 2003 meeting with Afghan pilgrims to Mecca, Hojatoleslam Mohammad Mohammadi-Reyshahri said that the United States created the Taliban so it would have an excuse to enter Afghanistan. He urged Afghans to stand up to Western aggression and promised that Iran would help them regain control of their fates. Reyshahri is the Supreme Leader's representative and supervisor of hajj pilgrims to Saudi Arabia, serves on the Assembly of Experts and the Expediency Council, and is head of the important Shahzadeh Abdolazim Shrine Foundation.
All these institutional factors are relatively easy to trace. It is more difficult to determine whether individuals like Vaez-Tabasi and Reyshahri are acting in an official capacity or as private citizens. Confusing the situation even more is the complicated network of intermarriage and seminary education that links the clerics who run the country. Such informal networks are not confined to Iran's clerical classes. Other networks are based on military service during the Iran-Iraq war, international university education, and regional origins.
Overshadowing this obscure mix of formal and informal institutional and individual connections is domestic factional politics, ranging from isolationist to interventionist. Traditional conservatives oppose exporting the revolution because it has the potential to harm trade and the bazaar. The left, on the other hand, initially identified the country's foreign policy interests with opposition to the United States. Centrists identified with Hashemi-Rafsanjani eschewed these approaches and hinted at the possibility of relations with the United States.
From Theory to Practice
The most important implication of the above is that the general direction of Iranian foreign policy can be determined by studying Supreme Leader Khamenei's statements, which means understanding that Iran's leadership fears the United States more than it had feared the Taliban or Saddam Hussein. On the eve of Operation Enduring Freedom (in September 2001), Supreme Leader Khamenei said, "We shall not offer any assistance to America and its allies in their attack on Afghanistan." As the crowd chanted "Death to America," Khamenei asked how the United States could seek Iranian assistance in attacking Afghanistan when "you [Americans] are the ones who have always inflicted blows on Iran's interests." And Khamenei warned, in a May 2004 discussion about events in Iraq, "America's threat today is not directed against just one or two countries in this region. The threat is directed against all of us. . . . They intend to devour the entire region."
It is possible that Tehran hopes to benefit from the difficult situation the United States faces in Iraq. Hashemi-Rafsanjani has used the "quagmire" metaphor often in this context. Even before Operation Iraqi Freedom began, he said, in a December 2002 meeting with officers of the IRGC, that because the United States does not have experience with the Iraqi military it "will get caught in a quagmire." Hashemi-Rafsanjani said in an April 2003 sermon, "They are in a quagmire." And a year later he said, "Americans have a bumpy road ahead of them. . . . They are really in a quagmire." He continued, "The day they set foot in Baghdad, I said that they had entered a quagmire and that from then onwards, the policy of extricating themselves from the quagmire had to be implemented."
It is noteworthy that the Iraqi cleric Muqtada al-Sadr, who has been leading an insurrection against the U.S. occupation of Iraq, met with Hashemi-Rafsanjani and IRGC officials during a June 2003 visit to Iran. Khatami refused to meet al-Sadr during that visit, and al-Sadr rebuffed Iranian Foreign Ministry officials who visited Iraq in mid-April 2004. Hashemi-Rafsanjani appeared to be trying to exploit this relationship when he told Al-Arabiyah television on May 5, "What we said regarding the Americans' fall in the Iraq quagmire is a fact being admitted by the U.S. leaders themselves." He continued, "If the United States makes an official decision to put the future of Iraq in the hands of the Iraqis, Iran can extend help at whatever level. This is because we have capabilities, friendships, and good relations with the Iraqi people."
Iranian actions can seem to cancel each other out. In the cases of Afghanistan and Iraq, Iran is using inflammatory propaganda in its radio broadcasts to undermine U.S. reconstruction and security efforts. Its special operations personnel reportedly are active in both countries. At the same time, Iran has pledged more than $500 million in aid for Afghanistan's reconstruction, and it already has sent business delegations to Baghdad. When one recognizes that different agencies have different agendas as a result of weak coordination or outright competition, the situation makes more sense.
Appearances to the contrary, Iranian foreign policy making is a rational process. However, it does not lend itself to the modeling favored by political scientists. The best way to understand Tehran's actions and to predict what it will do in the future is to know how the system operates and to be thoroughly familiar with the individuals within the system.
Special to the Hoover Digest.

Available from the Hoover Press is The Gravest Danger: Nuclear Weapons, by Sidney Drell and James Goodby. To order, call 800.935.2882.


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UN Nuclear Agency Demands Iran Suspend Uranium Enrichment
Sept. 18 (Bloomberg) -- The United Nation's nuclear watchdog agency demanded Iran cease all uranium enrichment activities and said it will decide on Nov. 25 whether to take steps to ensure the country's atomic program isn't a threat to the international community.
The International Atomic Energy Agency ``considers it necessary that Iran immediately suspend all enrichment-related activities,'' it said in a three-page resolution. The Vienna- based agency also demanded Iran further open its atomic program to inspectors. It did acknowledge the country has a right to enrich uranium.
The U.S. says Iran, with the second-highest oil reserves in the world, is concealing a nuclear weapons program and wants it sent before the UN Security Council for possible sanctions. Iran says its atomic program is peaceful and only intended to generate energy.
Iran's uranium enrichment activities have been suspended since October 2003, and the nation will decide in coming days if that will continue, said Hossein Mousavian, the head of Iran's delegation to the IAEA. It is Iran's ``national right,'' to convert uranium, he said earlier this week.
``We will continue our cooperation with the IAEA fully and transparently to clarify and resolve any remaining issues,'' Mousavian said at a press conference after the passage of the resolution.
Iran has had more than 800 IAEA inspections in the last year.
U.S. `Pleased'
The U.S. is ``pleased'' the IAEA has set Nov. 25 as a ``deadline for Iran to cease its pursuit of nuclear weapons,'' said Jackie Sanders, the head of the U.S. delegation.
``The resolution calls on Iran to take confidence building measures related to enrichment and reprocessing activities,'' Mohamed ElBaradei, the IAEA director general, said at a press conference. ``I think people were ready to listen to Iran's point of view, and I look forward to resolving the outstanding issues at the board meeting in November.''
The so-called Non-Aligned Movement of nations, representing 13 of the 35 seats on the International Atomic Energy Agency's board of governors, succeeded in making the resolution recognize a distinction between Iran's commitment to the Nuclear Non- Proliferation Treaty and its voluntary ``confidence building measures'' to stop enriching uranium.
`Confidence Building'
All signatories to the Non-Proliferation Treaty are allowed to enrich uranium as long as the activities are for producing energy and declared to the IAEA. Iran signed an additional protocol last year to suspend enrichment after engaging in undeclared activities.
``We are fully cognizant of the distinct difference between legal obligations and confidence building measures,'' Germany's delegation said in a statement. ``Signatories of the NPT should benefit fully from the peaceful use of nuclear energy.''
The Non-Aligned Movement has been in existence since the 1960s. It's members on the IAEA's Board of Governors come from Cuba, Egypt, India, Nigeria, Tunisia, Vietnam, Panama, Peru, Saudi Arabia, South Africa, Sudan, Malaysia and Pakistan. The group is composed of more than 100 member countries.
To contact the reporter on this story:
Jonathan Tirone in Vienna at jtirone@bloomberg.net
To contact the editor responsible for this story:
Chris Collins at collinsc@bloomberg.net
Last Updated: September 18, 2004 13:44 EDT


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Iran Is Criticized for Its Lack of Candor on Nuclear Program
By CRAIG S. SMITH
PARIS, Sept. 18 - The International Atomic Energy Agency's 35-nation board of governors passed a resolution on Saturday criticizing Iran for a lack of candor over its nuclear program and calling for the country to suspend all uranium enrichment activities that could contribute to producing fuel for a nuclear bomb.
The resolution, which was delayed by haggling over wording about the suspension, said the agency "considers it necessary" that Iran halt all of its uranium enrichment programs and meet all of the agency's demands before its Nov. 25 meeting.
It said the board would then "decide whether or not further steps are appropriate." The United States wants Iran's past breaches of the Nuclear Nonproliferation Treaty referred to the United Nations Security Council, which could decide to impose sanctions against the country.
Uranium enrichment, in which uranium is converted into a gas and spun in centrifuges to concentrate more fissile isotopes, is used to produce fuel for nuclear reactors, but it can also produce uranium suitable for nuclear weapons.
Signatories to the treaty are allowed to enrich uranium for peaceful purposes, but the activity can bring countries to within months of being able to produce a bomb.
Iran last year agreed to suspend uranium enrichment after it was found to have concealed an extensive enrichment program, which constituted a breach of its treaty obligations. But it almost immediately began quibbling over what activities that included.
In July, Iran resumed the manufacture of centrifuge parts and the assembly of centrifuge units, though it has upheld its suspension on using those centrifuges to enrich uranium.
The resolution passed on Saturday calls for Iran to stop all enrichment-related activities, including the manufacture and assembly of centrifuge parts, centrifuge testing and the conversion of uranium into gas.
The nuclear agency's chief, Mohamed ElBaradei, speaking after the resolution passed, said Iran needed to suspend its enrichment activities "in order to restore confidence" in its peaceful intentions, Agence France-Presse reported.
While Iran insists that its nuclear program is designed for power generation and other peaceful purposes, the country's sluggish response to the nuclear agency's requests for information and the program's own inconsistencies have convinced the United States and some other countries that Iran is hiding efforts to build a nuclear bomb.
Besides working on a light-water nuclear reactor near the Iranian port of Bushehr, for example, Iran had secretly begun work on a heavy-water reactor. It is easier to extract bomb-grade plutonium from the spent fuel of heavy-water reactors.
The nuclear agency has asked Iran to explain why it is building the heavy-water reactor and, in June, called for it to halt construction. Iran has not complied.
Washington also suspects that a partially buried bunker on a munitions plant in Parchin, 20 miles southwest of Tehran, could be used to test the kind of high-intensity explosives that surround a core of highly enriched uranium or plutonium in a nuclear implosion bomb.
Hossein Mousavian, the head of the foreign policy committee of Iran's Supreme National Security Council, said Friday that Iran would grant the nuclear agency access to the site. "We have never rejected an I.A.E.A. inspection," he said.
The country has continued to convert small amounts of uranium into the gas used in enrichment centrifuges, despite the nuclear agency's calls for it to stop. Earlier this month, Iran said it planned to convert more than 40 tons of uranium into gas soon. Experts say that will produce enough uranium hexafluoride gas to yield enriched uranium for several bombs.
Iran also insists that its moratorium on enriching uranium is temporary. "Suspension is not cessation," Mr. Mousavian said Friday.
Objections from many so-called nonaligned countries delayed the final passage of the resolution, which was drafted by Britain, France and Germany and later amended by the United States. Those countries wanted it made explicit that enrichment activities are allowed to all signatories of the nonproliferation treaty, and that any suspension by Iran would be made voluntary to build international confidence.
The United States spent the morning meeting with several reticent board members that have enrichment programs of their own, searching for wording that would allow the draft resolution to pass without having to submit it to a vote. While resolutions can be passed by vote, the agency prefers working by consensus to avoid politicizing its actions.
Copyright 2004 The New York Times Company
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>> NORTH KOREA



1,400 former senior officials in Seoul charge South now led by pro-North Koreans

Intelligence officials reject N. Korea's explanation of huge blast
"There is no reason for the North's regime to secretly conduct the demolition of a mountain in the middle of the night if it is for a hydroelectric project," said a South Korean intelligence official.

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Kim Jong-Il's sister-in-law told how Kim's eldest son, Kim Jong Nam (above) had an official killed in hopes of succeeding his father.

Report: North Korea building strategic underground facility near blast site

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North Korea 'planning more blasts'
(CNN) -- North Korea is planning to carry out two more explosions as part of a hydroelectric power plant project after a major blast last week sparked speculation a nuclear test had taken place, Kyodo news agency has reported.
A North Korean engineer told a group of diplomats who visited the site that they had been carrying out deliberate detonations for several weeks, the German ambassador to Pyongyang said in a telephone interview.
Diplomats from Germany, Britain, the Czech Republic, Mongolia, Poland, and Sweden made the one-day trip to Yanggang province on Thursday to verify North Korea's statement that the explosions were deliberate.
The mystery began when a 4-kilometer (2 miles) wide mushroom cloud was spotted near the Chinese border on satellite images by South Korea's Yonhap agency.
Two blasts took place on September 8 and 9, according to the engineer, but the pictures were not seen until three days later.
The explosions moved 150,000 cubic meters of earth and rock, according to Doris Hertrampf, the German ambassador.
"It was a huge construction site, and I saw large movements of earth going on,'' Hertrampf said.
But the Polish ambassador to Pyongyang, Wojciech Kaluza, said the group had reached no conclusion about North Korea's explanations.
European Union diplomats will meet on Friday to discuss the issue further, Kyodo reported Kaluza as saying.
U.S. Secretary of State Colin Powell told Reuters on Tuesday North Korea's explanation squared with Washington's view.
Some outside analysts speculated the explosion could have been at the Yongjo-ri Missile Base, a facility believed to house up to 36 NoDong missiles.
U.S. officials say there is no evidence that is true, though it cannot be completely ruled out.
According to data gathered by the Nuclear Threat Initiative (NTI), Yongjo-ri is a suspected site for North Korea's uranium enrichment program.
South Korea skeptical too
On Tuesday South Korea's defense minister said the country was seeking independent verification on the nature of the blast.
Yoon Kwang-woong said the South would use intelligence channels and satellite images to check on the source of the blast in a northern region of the North.
Hydroelectric experts in Seoul have questioned the North's explanation, saying the relatively small Huchang river in the area made it an unlikely and unfeasible site for a major hydro power plant, according to Reuters reports.
The nation's media have also raised questions, with the Chosun Ilbo newspaper quoting a North Korean defector familiar with the region who said the body of water in the area was not sufficient for a large power plant.
North Korea's official KCNA news agency said late Monday that reports of a large accidental explosion at the site or a nuclear test was a "preposterous smear campaign."
"Probably, plot-breeders might tell such a sheer lie, taken aback by blastings at construction sites of hydropower stations in the north of Korea," KCNA said.
Find this article at:
http://edition.cnn.com/2004/WORLD/asiapcf/09/16/nkorea.blast/index.html

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Lack of Intelligence Capabilities
Ado Over Mysterious Blast in North Turns Into Farce
Korea Times
The week-long ado over a mysterious blast in North Korea is now turning into a mere farce as it seems to have been touched off by our intelligence officials' poor assessment of an American satellite picture.
The fiasco has brought to light our poor intelligence capabilities concerning the Northern regime. It has also prompted the general public to raise concerns about intelligence cooperation between Seoul and Washington.
The comic episode began on Sept. 9 when the government received a picture of ``mushroom'' clouds over a Northern county bordering with China taken by a U.S. commercial satellite. The clouds led intelligence officials to believe they were caused by an enormous explosion. Some even speculated that the blast was much bigger than the explosion at the Ryongchon train station which took place in April, killing hundreds of people and injuring thousands of others, with children accounting for the largest number of the victims.
However, the government kept silent until Sept. 12 when local and foreign media began reporting that a large-scale blast might have taken place in Kimhyongjik county, Yanggang Province. Some foreign papers, simply relying on their analysis of the mushroom clouds, even suspected that the North might have conducted a nuclear experiment.
In a hasty press conference later in the day, Minister of Unification Chung Dong-young made a crucial mistake by saying that the clouds seemed to indicate an accidental explosion of serious magnitude. But he ruled out the possibility of a nuclear experiment.
The following day, the North told the visiting British deputy foreign minister that the blast was part of the ongoing construction of a hydraulic power plant in the county that began in May.
The North's explanation was corroborated by a picture of the area concerned taken by our satellite on Wednesday. The picture showed no sign of a recent large explosion.
Now it has even been suggested that the clouds were a natural phenomenon.
The hasty misjudgments concerning the U.S. satellite picture have made our government's intelligence capabilities, especially those aimed at the North, a laughingstock in the international community.
It does not make sense that the government seems to know almost nothing about what is happening in the North, even though it maintains various channels of dialogue with Pyongyang, which have become somewhat disrupted.
Taking a lesson from the latest confusion, the government ought to strengthen its ability to collect and assess information concerning Northern affairs and cooperation in the field of intelligence with Washington.
9-17-2004 17:34
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N Korea blast: The only certainty is doubt
By David Scofield
Two massive explosions in five months, one at a train station and one in the mountains, have rocked North Korea and caused rampant speculation about what's really going on in the Hermit Kingdom. The details of this latest blast in the military region near the Chinese border are not known, but North Korean officials told a visiting British diplomat that it had to blow up a mountain in order to build a hydro-electric project. Hmm.
The explosion last Thursday occurred in a remote, closely guarded military zone, reputed to be the location of missiles, even illicit nuclear projects. It took place in the North Korean county of Kim Hyeong-jik, named after Korean leader Kim Jong-il's grandfather. It sent up a huge non-nuclear cloud at midnight on the anniversary of the founding of the North Korean state 56 years ago.
The extreme control North Korea's leaders have over information dissemination within and, by extension, beyond the country guarantees more questions than answers in the wake of such detonations. Details surrounding the rail explosion in Ryongchon mere hours after Kim Jong-il's train passed through on his return trip from China in April are still elusive. Official reports then, as now, seem implausible, but without further evidence, the world's attention moves on, the truth buried like the untold numbers of victims involved.
Of course, stories and rumors continue to swirl. The train "accident" in April was an assassination attempt, many believe, pointing to Kim's crackdown on the use of mobile phones as evidence. Others, including many North Korean refugees, believe it was actually part of plan by Kim to create the illusion of an assassination attempt and use the event as justification to purge certain senior party members. And what of the Syrian technicians who were reported to be among the dead? Was this proof that that disaster was the result of a missile shipment gone awry? The first victim of war, even a "cold" one, is the truth.
The truth is no more malleable than in North Korea; facts being what the leadership, in the absence of vocal observers, decide them to be. Of course, not everyone is in the dark. The United States, China and Russia all have the remote sensing technology necessary to monitor the area for clues to what exactly ignited in the far north. Explosives leave chemical signatures that are carried aloft; blasts of different types leave behind characteristic scorches and craters.
Indeed, this mysterious event, like the Ryongchon disaster three months ago, sheds more light on the relationship between South Korea and the United States than it does of North Korea. When news of the detonation first began to break in South Korea on the weekend, anonymous sources within the South's defense establishment soon began commenting on the lack of information moving their way from their US counterparts.
The United States is South Korea's most valuable intelligence-gathering asset, providing, as it does, intelligence concerning North Korean military assets and maneuvers. But it seems the data are becoming more heavily vetted, a likely consequence of South Korea's growing ties with the North. The US is probably increasingly unsure how much of what it knows is making its way to North Korea, which would treasure US intelligence and would like to know just what Washington has gleaned and what it hasn't. Unexplained events like these explosions also highlight the fundamental changes that have taken place in the relationship between the US and South Korea.
In the final analysis, it's clear that again North Korea has managed to leave the world with more questions than answers. At the time of the explosion, British Foreign Office minister Bill Remmel was in Pyongyang to engage North Korea on human-rights issues. Immediately after word of the explosion, the British delegation "demanded", according to the British Broadcasting Corp (BBC), some explanation - and it got one. North Korean Foreign Minister Paek Nam-sun issued a statement indicating the explosion was part of the planned demolition of a mountain, destroyed, we are told, in preparation for a new hydro-electric project. In other words, the North Koreans decided to pack a mountain full of explosives (estimates put the explosive power at 1,000 tons) and waited until almost midnight on the eve of the country's foundation anniversary to level the mountain - yet none of this was broadcast, and so the domestic propaganda value of such an explosive display lost.
The implausibility of hydro-electric projects aside - South Korean analysts indicate the explosion took place in an area unsuitable for water-powered electricity generation - the statement does indicate one point: the North Koreans are expecting commercial satellites to produce pictures of a mountain removed, a large crater similar to what intelligence analysts have already hinted is evident from satellite photos.
It's also interesting that the mountain in question is set in the middle of one of North Korea's most heavily guarded and restricted counties. The whole area is a "military camp", Chinese observers have commented. In fact, according to the Nuclear Threat Initiative, the region is thought to house North Korea's medium-range missiles in a complex of tunnels deep underground. The county is also the location of sites suspected to house North Korea's highly enriched uranium (HEU) project, the catalyst behind the latest nuclear crisis. North Korea admits it has a nuclear program, but denies that it involves enriched uranium.
An example of just how far the speculation goes: Some wonder whether it was possible that the three-to-four-kilometer-wide non-nuclear mushroom cloud, the first clue of the explosion last Thursday, was actually the result of a precision attack by either China or the US on these suspect sites, a prelude to the upcoming but still not scheduled six-party talks. The negotiations are aimed at persuading North Korea to dismantle its nuclear program in return for security guarantees, alternative energy supplies and massive economic assistance.
With no radioactive fallout reported by any of North Korea's neighbors, nor from regional technologies designed to monitor such events, all indications are a conventional explosion of unconventional magnitude - similar to the Massive Ordnance Air Burst (MOAB) the United States tested in the spring of 2003.
Designed to replace the Vietnam-era, 12,000-pound (5,440-kilogram) "Daisy Cutter" bomb, the US Air Force's new 22,000-pound (10,000kg), Global Positioning System (GPS)-guided MOAB, applied in multiples, could create a conventional explosion similar to that which has been described to have happened in North Korea. Tests of a single MOAB (those who witnessed it referred to it as the Mother of All Bombs) in 2003 showed that the weapon created a mushroom cloud that extended about three kilometers in the air, yet left a relatively small seismic signature. Of course, that MOAB tested in Florida was designed, as the name suggests, to burst above ground, but the crater - the missing North Korean mountain - suggests a ground or below detonation: subterranean force projection? The USAF includes "deeply buried targets" within the 10-tonne weapon's target range; it is a penetrating weapon capable of delivering the explosive power of 18,000 pounds (more than 8,000kg) of Tritonol to targets deep beneath the surface.
Such an attack from beyond, especially if it involved China, would likely not elicit an immediate, direct response from North Korea. To acknowledge an attack would mean acknowledging the target, and would also create pressure to retaliate, a hasty response that could spell the end of the Kim regime.
Of course, this could also be a demonstration of North Korea's conventional firepower, though the efficacy of such a demonstration, tremendous explosive energy in an undeliverable format, seems a bit hollow. Or perhaps human error, an accident, an ammunition depot or arms factory ignited because of faulty equipment and carelessness, or as the result of some external catalyst.
In the end, this event, like the last, will likely be swept aside in days and weeks to come as a lack of new evidence relegates the story to the wayside. We may never know the what, why, how or even who behind the blast.
David Scofield, former lecturer at the Graduate Institute of Peace Studies, Kyung Hee University, is currently conducting post-graduate research at the School of East Asian Studies, University of Sheffield, United Kingdom.
(Copyright 2003 Asia Times Online Co, Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)


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Diplomats visit N. Korean blast site
BEIJING - Foreign diplomats who visited the site of a mysterious explosion in North Korea said yesterday it was a hydroelectric project under heavy construction.
Video footage from an independent source showed excavations and evidence of blasting in a river valley. -- AP
The blast, reported by South Korean media last week, initially raised concern that North Korea had tested a nuclear weapon. A mushroom cloud was seen in an area known to contain storage sites for missiles and explosives.
To prove this was not the case, North Korea on Thursday took a group of foreign diplomats to what it said was the blast site in Samsu county in the remote north-east.
Pyongyang had said the reported blast was one of two controlled explosions to remove a mountain to make way for a power plant.
The diplomats from Britain, Germany, Poland, Russia, Sweden, the Czech Republic, India and Mongolia reached the site after a 90-minute flight followed by a three-hour drive, according to Sweden's ambassador to North Korea Paul Beijer.
They spent about 1 1/2 hours taking photographs, talking to officials at the site and gathering information that their governments' technical experts would analyse, he said.
Video footage showed excavations and evidence of blasting in a river valley. Scores of workers - many of them apparently carrying sacks of material - were shown swarming around.
Polish Ambassador Wojciech Kaluza said the North Korean project manager told them there were 50,000 workers at the site and gave figures on the size of the project, the amount of explosives used and of soil that had to be removed, Japan's Kyodo news agency reported.
The visitors were told the blasts on Sept 8 and 9 were larger than usual to speed up work on the dam, and that more were planned, said German envoy Doris Hertrampf.
The area visited was about 60km east of the site initially identified by South Korean intelligence authorities.
South Korean Vice Unification Minister Lee Bong Jo yesterday said the latest assessment was that no blast took place at the suspected site in Kimhyongjik county, which is near the Chinese border. Rather, it was more likely an earth tremor.
As for the reported mushroom-shaped clouds, he said they could be explained away as natural phenomena.
Mr Yun Du Min of South Korea's Institute of Foreign Affairs and National Security said intelligence failure and the suspicion with which secretive North Korea is viewed contributed to the confusion.
'This appears to have been an intelligence failure as we looked into a very closed society. The heightened level of alert in the way the international community looks at North Korea likely bred this incident,' he said.
Another round of six-party talks on the North's nuclear programme was to have been held in Beijing before the end of this month. The talks now seem unlikely. -- Reuters, AFP, AP

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North Korea Blast Wasn't Nuclear, Diplomat Says After Visiting Site
By THE ASSOCIATED PRESS
Published: September 18, 2004
BEIJING, Sept. 17 (AP) - Video of the area where North Korea said a huge explosion had occurred last week showed dozens of workers swarming around a construction site resembling a large dam project, while a foreign diplomat who visited the site said Friday that he had found no sign that the blast was nuclear.
South Korea, meanwhile, said a mushroom-shaped plume thought to be from the blast on Sept. 9 was 60 miles away from the site where North Korea said it occurred, and that it may have been a natural cloud formation.
Diplomats from seven countries were flown by the North Korean government to the country's remote northeast, near the border with China, on Thursday to verify claims that the explosion was part of work on a hydroelectric dam.
"One thing is entirely clear: This was not a nuclear explosion that happened at this site," Sweden's ambassador to North Korea, Paul Beijer, said by phone from the North Korean capital, Pyongyang. "This is a site where thousands of people are working on dam building."
Concern arose when South Korea said days after the blast that a mushroom cloud more than two miles wide had been spotted by satellite.
Independent video of the construction site was obtained by Associated Press Television News in Pyongyang, hours after the ambassadors returned from their visit.
The video showed a building complex intact near a place where rock had been blasted away, with scores of workers moving around. A deep excavation with large pools of water and wooden shelters could be seen across the valley, apparently where the dam is intended to rise.
The size of the cloud and the timing of the blast, which coincided with the 56th anniversary of North Korea's founding, fed speculation in the South Korean news media that it was a nuclear test. But a South Korean official, Deputy Unification Minister Lee Bong Jo, said his government concurred with the North's insistence that the blast had not been nuclear.
The incident occurred amid efforts to arrange a new round of six-nation talks on demands for the North to give up nuclear ambitions. The talks involve the Koreas, the United States, China, Russia and Japan.
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SNAG IN SIX-PARTY TALKS
Pyongyang demands Seoul reveal N-tests
The communist country says it won't return to talks over its nuclear programme unless South Korea discloses details of secret N-tests
SEOUL - A delay in planned six-party talks on North Korea's nuclear activities appeared certain with the communist nation saying it will not talk until South Korea fully discloses the details of its secret atomic experiments.
China, host of three previous rounds of talks, acknowledged on Thursday that 'many difficulties' stand in the way of this month's talks.
'It is down to North Korea and the United States,' Foreign Ministry spokesman Kong Quan said in Beijing. 'There are many difficulties for the talks to be held as planned.'
Mr Kong gave no details but appealed to the participants to 'make efforts so we can hold the next round before the end of September, as we agreed earlier'.
North Korea relayed its position on the talks when British Foreign Office Minister Bill Rammell visited Pyongyang earlier this week, a spokesman for the North Korean Foreign Ministry told the country's official news agency, KCNA.
The comments further clouded US-led international efforts to persuade North Korea to give up its nuclear activities.
During Mr Rammell's four-day visit that ended on Tuesday, North Korea 'clarified its stand that it can never sit at the table to negotiate its nuclear weapon programme unless truth about the secret nuclear experiments in South Korea is fully probed', KCNA quoted the North Korean spokesman as saying.
South Korea recently acknowledged that it conducted a plutonium-based nuclear experiment more than 20 years ago. That admission came shortly after it said it conducted a uranium-enrichment experiment four years ago.
Plutonium and enriched uranium are two key ingredients of nuclear weapons.
South Korea has denied any ambition to possess nuclear arms. Foreign Minister Ban Ki Moon said he was confident that investigations by a UN nuclear watchdog will prove that his country's nuclear experiments were not conducted for weapons advancement.
Three rounds of talks by China, the two Koreas, the United States, Japan and Russia have not produced major progress towards settling the nuclear dispute.
The six nations had previously agreed to meet again by the end of this month, but no date has been set.
Washington wants North Korea to halt its nuclear activities immediately.
North Korea says it will freeze its nuclear facilities as a first step towards their eventual dismantling only if the US lifts economic sanctions and provides energy and economic aid. -- AP

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>> CHINA

The Chinese puzzle: Jiang's retirement
By Zhu Zhan
HONG KONG - When the curtain rose on the decisive party plenum of the Chinese Communist Party (CCP) on Thursday, startling reports surfaced in Beijing's political circles that the current commander-in-chief and former president Jiang Zemin would propose his resignation as military leader. While the reports have not been confirmed, many political observers see the possible resignation as Jiang's tactic to dispel the mounting pressure on him to yield power. He might step down but still be China's "Phantom Regent".
It is believed that such a decision could please some party chieftains who are unhappy to see Jiang as the supreme military leader for a prolonged period; on the other hand, a decision to step down would strengthen Jiang's hand and bargaining position as he seeks to install his confidants and proteges in the administration. As the positions of some military heavyweights remain unclear, the ball seems to be in the court of President Hu Jintao, who is supposed to control the armed forces concurrently - it is one of the Middle Kingdom's old traditions that state and military leadership go hand in hand. Jiang is chairman of the party's powerful Central Military Commission (CMC).
Reuters and Taiwan's United Daily News reported this week that Jiang had proposed to hand in his notice of resignation, tallying with an earlier dispatch from the New York Times. In addition, members of the CMC reportedly are to be increased from four to seven, with three entries from the navy, the air force and the No 2 Artillery.
Coincidence or not, early this month Beijing staged a high-profile celebration of the 60th anniversary of the death of "martyred" anti-Japanese hero Peng Xuefeng. Jiang even inscribed the name of the book Biography of Peng Xuepeng. In fact, Peng Xuefeng's son, Peng Xiaofeng, is now commissar of the No 2 Artillery, a high-ranking position in Chinese military system. He and Liu Yazhong, vice commissar of the air force, are both considered under the patronage of Jiang. Obviously, Jiang has been actively preparing to extend his authority within the military, if he is forced out of power some day.
One informed source, speaking on condition of anonymity, told Asia Times Online that Jiang, now 78, had promised in 2002 to steer the CMC for only two years. Now, time is up. Party veterans who had been edged out of the top echelon by Jiang, including former chairman of National People's Congress Qiao Shi and former chairman of Chinese People's Political Consultative Conference Li Ruihuan, have long been murmuring their discontent about the "Phantom Regent" and cannot wait to see him out. During the CCP's massive commemorations for the centennial anniversary of the birth of late paramount leader Deng Xiaoping, Deng's virtue of early retirement from the throne and his hands-off manner had been hyped by the state-run media. Political commentators aver that all these developments and displays put considerable pressure on Jiang Zemin.
Jiang's proposed retirement could also be interpreted as his scheme of "one step backward and two steps forward". In return for his resignation, he can still project his influence by installing confidants in the expanded Central Military Commission, negotiate for his appointment of a vice chairman in the CMC, and even reserve the right to name Hu Jintao's successor as CMC chairman. This is a common political trade-off practice in Chinese political arena.
At the moment, most military heavyweights have yet to declare their stance on the matter. However, some pro-Jiang generals rushed to pledge support for their boss. Guo Boxiong, Jiang's deputy in the CMC, stressed that the armed forces should follow Jiang's orders under any circumstance. Another CMC member, Xu Caihou, reiterated on a few occasions the significance of the so-called "Three Represents" theory developed by Jiang that has already been added to China's constitution. The theory reads "The party must always represent the requirements of the development of China's advanced productive forces, the orientation of the development of China's advanced culture, and the fundamental interests of the overwhelming majority of the people in China".
Predictably, China's state president and CCP chairman Hu Jintao might be quite cautious in responding to Jiang's proposal. In retrospect, former party chief Hu Yaobang was kicked out of Zhongnanhai (the compound of China's leaders) by Deng Xiaoping, partly because of his remarks endorsing Deng's pledges to withdraw completely from the political arena. It is reported that President Hu declined Jiang's resignation two years ago, so how he will react this time around remains a focus of the world's attention.
It is generally believed that it will take some time for Hu to operate against the backdrop of Jiang's legacies and popularity in the military. As recently as June, Jiang promoted 15 military officers to full general - mostly from the pro-Jiang camp, including his top bodyguard You Xigui, who now is director of the Central Guard Bureau. In China, an officer in You's position is seldom promoted to such a military rank, and most observers say that Jiang is trying to maximize his power in the armed forces. Moreover, his "Three Represents" theory, now enshrined in the Chinese constitution, can play a part in his efforts to broaden his influence.
(Copyright 2003 Asia Times Online Co, Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)
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Resignation of China's Senior Leader Appears Imminent
By JOSEPH KAHN
BEIJING, Sept. 18 - Jiang Zemin, China's military chief and longtime senior leader, may formally step down on Sunday, putting President Hu Jintao in full command of the Chinese Army, state and governing party, according to people informed of the proceedings of a secretive Communist Party meeting.
Mr. Jiang's retirement, which has not been confirmed by official sources, would come as a surprise to many political experts, who expected him to remain chairman of the Central Military Commission and the de facto senior leader until 2007.
It remains possible that his resignation, submitted earlier this month and now said to be under consideration by a top decision-making body, may be rejected. But Mr. Jiang, 78, who became China's top political and military leader after the crackdown on pro-democracy protesters in 1989, has come under heavy pressure to allow a new generation of leaders to grapple with China's mounting political and economic challenges.
People who have seen Mr. Jiang or spoken to his relatives in recent weeks say he has serious health problems. One person said he had throat cancer; another said he had persistent heart troubles. It was unclear whether these health issues might have forced Mr. Jiang to retire before he was ready, or, whether they might provide a cover story for a decision that has more to do with internal politicking.
Mr. Hu, 61, who took Mr. Jiang's titles of Communist Party chief in 2002 and president in 2003, has put forward plans to inject more transparency and discipline into the one-party political system and to raise incomes of blue-collar workers and peasants. But Mr. Hu has also imposed stricter controls on the media than those that existed when Mr. Jiang held China's top titles, and he has ruled out experimenting with Western-style democracy. He remains an enigma, a carefully crafted product of the Communist Party system, whose innate reserve appears to have been magnified by behind-the-scenes tussles for influence with Mr. Jiang.
Though Mr. Hu and Mr. Jiang have not openly clashed over policy matters, several party officials have argued that they had become the effective standard-bearers for rival schools of thought on many domestic and foreign policy issues. The notion that there are two camps at the top may have made lower-level officials less inclined to carry out policies they oppose, including the continuing campaign to slow China's overheated economy and curtail wasteful state spending.
Numerous questions remain about Mr. Jiang's actions. Among them is why he submitted his resignation a short time after party officials said he appeared to be trying to enhance his authority.
In recent months, he has promoted numerous military officials to higher posts. Experts took that as a sign that he was solidifying his control of the military rather than preparing to hand his responsibilities to Mr. Hu, as had been agreed before the leadership transition in 2002. State media also increased its coverage of Mr. Jiang in recent months.
Party officials say that in recent private meetings with leading scholars, Mr. Jiang challenged the economic program pursued by Mr. Hu and Wen Jiabao, the prime minister.
Earlier this year, Mr. Jiang opposed and effectively sidelined a new framework for China's foreign policy Mr. Hu had developed. Mr. Jiang argued that a slogan Mr. Hu had begun using to describe China's ambitions as a great power, "peaceful rise," sent the wrong signal at a time when Beijing was warning Taiwan that moves toward independence would provoke military retaliation.
Mr. Jiang was active enough in recent weeks that several well-informed political analysts in Beijing said they suspected that his proffered resignation, which The New York Times first reported earlier this month, might be a trick to mobilize his core constituency, or to fend off the attacks from party elders anxious for him to retire. Those people speculated that Mr. Jiang might have intended to have his resignation rejected, perhaps on the ground that sensitive foreign policy problems, including those involving Taiwan and North Korea, required his continued attention.
That remains possible. But two people informed about the leadership's decision-making process said they expected the full 198-member Central Committee to vote on Mr. Jiang's resignation and a new slate of candidates to fill slots on the Central Military Commission before its annual four-day session ends Sunday.
These people said it was unlikely that Mr. Jiang's resignation would be under consideration by the Central Committee if it were merely a gambit, as matters that go before that body tend to be pre-approved by the governing Politburo.
Moreover, Mr. Jiang told domestic and foreign visitors in recent weeks that he was wary of the appearance that he is clinging to power and has every intention of handing over authority to Mr. Hu, as has been the formal plan of the Communist Party since at least the late 1990's.
Mainland media have not carried any news about Mr. Jiang's resignation. But Reuters, Agence France-Presse and The South China Morning Post, a Hong Kong-based English-language daily, all carried reports Saturday quoting party and diplomatic sources as saying Mr. Jiang's retirement would be announced on Sunday.
It is not clear how the Central Military Commission, which controls all of China's armed forces, would be restructured under a new chairman.
Mr. Hu is currently a vice chairman of the eight-member commission, along with two generals, Guo Boxiong and Cao Gangchuan. Mr. Jiang has been thought to favor promoting his longtime prot?g? and ally, Vice President Zeng Qinghong, to serve as a vice chairman. Two people informed about a recent debate inside the military commission said Mr. Jiang made Mr. Zeng's promotion a condition of his retirement. They also said Mr. Hu opposed this move, possibly because it would leave his control of the military incomplete.
Chris Buckley contributed reporting for this article.
Copyright 2004 The New York Times Company




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First or Equals?
China's President Hu wants to consolidate power, but his predecessor Jiang Zemin has not yet faded away
BY MATTHEW FORNEY | BEIJING
The Beijing Olympics were to be the most lavish ever. China would spend $34 billion to refit the capital with sparkling new subways and 10 state-of-the-art stadiums. The spending was the plan of former Communist Party chief and former President Jiang Zemin, who took credit for Beijing's winning bid in 2001. The Olympic projects, it was hoped, would mark China's economic growth and proclaim its arrival as a world power. Now times have changed. Last week Liu Qi, president of the Beijing Olympic-organizing committee, scrapped half the planned stadiums in a demonstration of what he called "the principle of thrift." But in Beijing, observers of the always opaque Chinese leadership are wondering if the new policy smacks of political infighting as much as it does of economy.
Though Jiang stepped down from his positions as General Secretary of the Communist Party in 2002 and President of the country in 2003, he remains chairman of the Central Military Commission and hence commander of the People's Liberation Army. Hu Jintao, who succeeded Jiang as Party chief and President, wants to consolidate his own power. Last week, a report in the New York Times suggested that Jiang may give up his army position at a key Communist Party plenum this week. There is no consensus in Beijing on whether such an outcome is likely. But with rumors swirling, cancellation of the Olympic stadiums gained added significance. Older Chinese remember that in 1979, Deng Xiaoping signaled his rise to power by canceling 10 massive industrial projects championed by his rival, Hua Guofeng. In all likelihood, says a well-placed Beijing academic, the scaling back of the Olympic plans relates to a "struggle" between Hu and Jiang.
Hu's primacy remains incomplete. Jiang continues to enjoy the loyalty of many senior Party and military officials and maintains a power base in China's commercial hub of Shanghai. But as is always the case in China, assessing whether there are differences between the two men depends on the examination of tiny shards of evidence. According to agreed protocol, for instance, Hu can demonstrate first-among-equals status by entering meeting halls before Jiang. Yet Jiang often ambles into halls first. So Beijing's political insiders watched closely on August 22 as both men entered the Great Hall of the People to commemorate the centenary of Deng's birth. Just before Jiang entered ahead of Hu, the live television broadcast cut to a shot of the red star on the ceiling and didn't pan the hall until Jiang had seated himself. "Apparently, Hu had had enough," says an editor at a Party-run newspaper. In this shadowland, the hardest question to answer is whether personal differences speak to larger disagreements on policy. Hu has emphasized a balanced development between China's booming coastal cities and its poor hinterland, and he seems to want closer ties with European and Asian nations, as well as with the U.S. Jiang, for his part, encouraged rapid economic growth along the coast and made sound relations with the U.S. the cornerstone of his foreign policy. Last December, Hu made a major speech on "The Peaceful Rise of China," which was meant to signal his arrival as a theorist while assuring the world that China's emergence as a world power would not threaten its neighbors. But Jiang, says a Western diplomat in Beijing, "forced Hu to tone [the theory] down." In subsequent speeches, Hu has referred instead to China's "peaceful development."
Conceivably, the change in wording suggests differences in policy. Many Chinese foreign-relations experts, for example, have long favored a more conciliatory posture toward Taiwan. They remain deeply skeptical that Taiwan's President Chen Shui-bian could ever become a trusted negotiating partner but fear that threatening Taiwan with military action may only drive the island further down the road to independence. That sentiment is shared by many who worked on Hu's "Peaceful Rise" theory, according to a scholar who consulted with them. This source says Jiang opposed the slogan partly because it sent too soft a message to Taiwan and Washington. In the same vein, Beijing's attitude toward Hong Kong could also hinge on contests at the top. China watchers in Hong Kong are deeply divided on whether there are any splits in Beijing in policy toward the city. But it was Jiang who appointed Tung Chee-hwa, Hong Kong's deeply unpopular Chief Executive. Hu, for his part, has seemed to distance himself from Tung by urging him to pay closer attention to the popular will.
In moving to consolidate power, Hu has shown a deft touch. In July, he visited Jiang's power base of Shanghai. Senior officials there had complained that new austerity measures requiring Beijing's approval were deflating the city's boom. A smiling Hu allowed photographers to record him strolling past marshland that Shanghai officials hope to turn into an industrial zone and touring high-profile factories. Shortly after Hu returned to Beijing, the central government approved construction of a long-awaited tunnel-and-bridge project to Chongming Island, and city officials say the second phase of a deepwater port has not been blocked by central planners. The message seemed to be that Shanghai could continue steaming ahead. "Hu set out to defang Jiang's tiger" in Shanghai, says the Western diplomat.
Hu may also be able to rely on unexpected allies in the army, where he is No. 2 to Jiang. Last month Gen. Chi Haotian, a retired Defense Minister long considered supportive of Jiang, wrote in Seeking Truth, a Party magazine, that the army must "at all times obey the Party" and "cannot concentrate power in a few individuals." Chi then praised Deng for his quick resignation as head of the military in 1989: "He just said 'bye-bye,' picked up his briefcase and left." This, wrote Chi, showed that Deng was a "truly selfless man, a man who considered the overall picture." That sounded like a message to Jiang. Taken together with the stadium cancellations, those messages seem to be getting more frequent, and louder.
With reporting by Hannah Beech/Shanghai


A Disappearing Act
Jiang Zemin gets painted out of the picture in a mysterious set of photos
BY MATTHEW FORNEY | BEIJING
Every appearance by Chinese leaders is political. They enter rooms in single file according to rank, and newspapers place photos of senior officials higher on the page than those of lesser rivals. So strict are the rules that when Hu Jintao took over as Party chief from Jiang Zemin two years ago, Beijing's print media waited four hours for instructions from propaganda officials on whose picture to run at the top. (They ran side by side.) The two leaders are now thought to be jockeying for power; Jiang remains chairman of the Central Military Commission, and a key Party meeting is scheduled for this month.
Thus a set of photos, published last month during celebrations for the 100th birthday of late Communist Party patriarch Deng Xiaoping, raises questions about the relationship between the two men. The original image, published in the state-run Oriental Outlook magazine in the last week of August, shows Hu shaking hands with Deng in 1992 while Jiang stands behind them, as if giving introductions. But in the other two photos, which appeared in Shanghai's Wen Hui Bao newspaper on Aug. 13 and in a set of pictures celebrating Deng's centenary, Jiang has vanished. At least one of the doctored photos was released by the Xinhua news agency--which implies either official complicity or a massive goof. Either way, "it can only be embarrassing for Jiang," says an editor from a Party-run newspaper, because "someone very publicly wants him to disappear."


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Hu-Jiang struggle: Not a shooting war
By Yu Bin
Does China have a gun control problem? Yes. Whoever controls one of the world's largest armed forces naturally draws worldwide attention. Recent media mania, however, seems excessive in painting an intensifying power struggle between the moderate-reformist head of state and Communist Party President Hu Jintao, and the nationalist-conservative military strongman Jiang Zemin, 78, chairman of China's powerful Central Military Commission (CMC).
On the eve of the fourth plenary session of the 16th Chinese Communist Party (CCP) National Congress from September 16-19, the Jiang-Hu rivalry is said to have reached such a state that various key policy issues are at stake. They are reported to include Beijing's uncompromising stance toward Taiwan, Hong Kong's democratic elections, growing social instability at home, rampant corruption, inner-party democracy, and the most salient issue of all, who will command the 2.5-million-member People's Liberation Army (PLA). The PLA is said to favor a hardine policy toward Taiwan and the storm clouds gathering over the Taiwan Strait indeed represent a serious issue for both leaders.
All of these reports on divisions and struggle have yet to be solidly proved. The media focus on the so-called Jiang-Hu rivalry over the CMC chairmanship misses other points that may be more important. In the absence of major foreign and domestic crises, current politicking in China has more to do with policy issues, particularly Taiwan, than major personnel changes; and more to do with leadership continuity than its reshuffling. The alleged Jiang-Hu gun control (control of the military) dispute and the PLA's allegedly increasing role in Chinese politics may not hold much water, given the clear trend toward firm civilian control of the military in the reform decades from 1978 to the present.
The PLA's de-politicization under Deng Xiaoping
After the massive military intervention in politics during the Cultural Revolution (1966-76), China's political and military elite came to the consensus that the excessive politicization of the armed forces should not be repeated; soldiers should be back in their barracks, and the PLA should focus on professionalizing, restructuring, training, streamlining and modernizing. As a result, civilian leadership regained its authority over the armed forces. Under former leader Deng Xiaoping, the PLA was essentially de-politicized, de-factionalized, and pulled out of its ubiquitous involvement in civilian affairs. Since then, it has engaged in the longest period of serious professionalization in its history.
By the late 1980s, the PLA involved itself in quelling student-led demonstrations. The military was, nonetheless, brought back into politics, albeit reluctantly, by civilian leadership. Once normalcy and stability were achieved, Deng moved quickly to place the PLA under the new CMC chairman, Jiang Zemin, in November 1989. In the next few years before finally fading away, Deng would make sure that Jiang institutionalized his control of the PLA.
Jiang, the PLA's first civilian boss
A technocrat trained in the former Soviet Union, Jiang had no formal military experience whatsoever. Nor did he have any institutional backing from the vast central bureaucracies in Beijing, except for Deng's personal support. As the PLA's first real civilian leader, however, Jiang managed to develop an unprecedented institutionalized authority, which enabled him to assume all the top offices: CCP general secretary, president of the state and chairman of the party's CMC.
These formal titles, however, were not necessarily sufficient to enable Jiang to command the PLA. During his tenure as CMC chair, Jiang made a concerted effort to befriend the PLA, leading to the PLA's eventual acceptance of his leadership. Perhaps more than any other top leader, Jiang reached out to cultivate support from the PLA. Military spending rose steadily in the 1990s. Jiang also traveled widely and frequently to military units during holidays and visited troops in remote areas. Even on his way to and from foreign visits, Jiang lost no opportunity to send cables from his Chinese Air Force One to the PLA's border security units on the ground below. Beyond those high-altitude gestures, Jiang managed to gain support and loyalty from almost all sectors of the PLA: from younger officers, for his broad policy of nurturing a highly educated, well-trained and professionalized officer core; from the rank-and-file, for improving soldiers' living conditions; and from older generals, for being promoted to comfortable retirement or semi-retirement. Over time, Jiang felt so confident of his ability to command and control the PLA that he decided in 1998 to sever the military completely from any commercial activities - something that Deng was either unwilling or unable to do.
Jiang is by no means a Mr Nice Guy for the PLA. He also took major steps, almost every five years, to reshape the army. This includes the CMC's decision in April 1992 to continue streamlining and restructuring the PLA in order to consolidate its one-million-person cut in the 1980s, and the September 1997 decision to cut an additional 500,000 personnel in three years. This was followed by a major overhaul of the PLA's command-and-control, logistics, and armament mechanism in April 1998, when a unified general armament department was created alongside the PLA's general staff, general political, and general logistics departments. One of Jiang's most recent efforts to reform the PLA came when he articulated the historical mission for the PLA's mechanization and information-based military (xinxi hua) in the CCP's 16th Congress in November 2002.
In retrospect, Jiang has gone to extraordinary lengths to institutionalize as well as personalize his ties with the PLA. Lacking the personal charisma of Mao Zedong and Deng Xiaoping, Jiang has sought to dominate almost every policy-making institution.
Implications for Hu Jintao
Jiang, the former paramount leader, may well turn over his command of the Chinese military in the upcoming plenary session, just as he yielded his Communist Party chairmanship to Hu Jintao in late 2002 and the state presidency in March 2003. Or he may choose to fade away over a few more years. Whatever way Jiang goes, and he eventually will go, the PLA's future top civilian leader, presumably Hu, will have to operate against the backdrop of Jiang's PLA legacies and popularity. This has a number of implications.
First, Hu himself will have to nurture his own relationship with the PLA. Simply taking over the CMC chair from the elderly Jiang doesn't mean that Hu himself will not have to define the style, scope and depth of his own ties with the military. In this sense, the formal CMC title may not be of overriding importance for Hu. He will need to demonstrate his commitment to the military.
Second, the process for Hu to assume the PLA's new civilian leadership already started at least five years ago, when Hu became a vice chairman of the CMC. Ever since then, Hu has been part of the team, though still in Jiang's shadow. Hu's elevation to the No 2 position in the CMC was more than a procedural and symbolic promotion, given his deep involvement in the de-commercialization of the PLA in the late 1990s. During the early reform period, the PLA rapidly and significantly expanded its commercial activities and was engaged in extensive industrial and not necessarily military-related enterprises.
The military was also responsible for much of the rising tide of corruption, tax evasion and smuggling. Several efforts to reduce the military's commercial activities during the 1990s yielded few results due to strong resistance from the military. Once Jiang made the decision to de-link the PLA from commercial activities, however, Hu was assigned to do the dirty work of actually separating the PLA from its lucrative enterprises. This was guaranteed to be unpopular among PLA officers. The fact that the PLA went along with these decisions suggests its initial acceptance of Hu as its future commander-in-chief.
The current dual-center of politics in China, with Hu as the party/state leader and Jiang as the PLA boss may not be desirable for timely and efficient decision making. The unfinished leadership transition from Jiang to Hu, however, is perhaps the most uneventful compared to that of any of Jiang's predecessors. Jiang began taking over the PLA at a time of national crisis in 1989 (the Tiananmen Square massacre took place in June 1989). Before that, Deng's leadership was established in the aftermath of China's 10 years of political turmoil. Deng's comeback began in 1978. To go back further, Mao Zedong never developed easy ties with the PLA, as he was in conflict with both of his defense ministers - Peng Dehuai, in 1959, and Lin Biao, in 1971. It is unlikely Hu and Jiang have any compelling reason to hurry through the power transition of the CMC leadership.
Third, it remains to be seen if the unfinished handover of the CMC chairmanship to Hu would spill over into other policy areas. Hu and his new premier and ally Wen Jiabao quickly established themselves as a kinder and gentler fourth generation of leaders tilting toward the less fortunate groups in China. This is in contrast with Jiang's merit-based and market-driven approach favoring the political, business and intellectual elites. In early 2003, Hu went so far as to unveil his own "Three People's Principles" - power for, sympathy with, and benefit for the people. Jiang's theory of the "Three Represents" (meaning the CCP represents the most productive parts of Chinese society) remains part of Hu's vocabulary. Hu's more "compassionate" public policy, however, is a timely and healthy balancing move, as China is fast becoming one of the most inegalitarian nations in the world after decades of market reform.
Fourth and finally, it's common sense that leadership crises in China usually occur in times of socio-political upheaval. Although China is faced with tremendous difficulties in its economic and political reforms, the huge nation has been in the midst of continuous economic development with no sign of a major domestic crisis (except for the severe acute respiratory syndrome, SARS, outbreak in 2002). Jiang and Hu may have disputes over some specific issues, but perhaps they have more in common when it comes to maintaining China's steady and rational economic growth, as well as social stability.
Political stability and the gathering Taiwan storm
The only possible source of crisis, therefore, may come from the highly sensitive and increasingly dangerous issue of Taiwan's independence, as Taiwan's self-imposed timelines are fast approaching, regarding the constitutional revision in 2006 and perhaps bolder moves toward independence before the end of President Chen Shui-bian's second term in 2008.
If this is the case, the policies of Jiang or Hu will largely be driven by the perception of a sharply deteriorating cross-strait situation in that Taiwan is fast becoming a grave threat to China's core national interests. This means that Taiwan is seen as a break-away province reaching the point of no return; as a key component of a de facto military alliance against China, and as a ready platform from which to launch military strikes on China's vital political, economic and population centers. In a broader historical perspective, China's Taiwan policy will be driven not necessarily by the hawks in the PLA alone, but by a deluge of Chinese nationalism that has been building ever since the late 19th century, when Taiwan was ceded to Japan after the 1894-95 Sino-Japanese War. This is the case regardless of the nature of the China's political system: emperor-based, republican, communist, or democratic.
Given the Taiwan situation as it is now unfolding, Jiang and Hu may well be more united in seeking an effective solution-resolution than in vying for the position of chairman of the CMC. And Jiang may continue to command the PLA in the near future, as a storm gathers over the Taiwan Strait.
Yu Bin is an associate professor of political science, Wittenberg University, and senior research associate, Shanghai Institute of American Studies. He is also a regular contributor to Pacific Forum/CSIC, Comparative Connections, and co-author of Mao's Generals Remember Korea (University Press of Kansas, 2001). He can be reached at byu@wittenberg.edu .
(Copyright 2004 Asia Times Online Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)



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Communist Party 'must adapt to change'
With problems curbing graft and abuses, the CCP is having a tough job sustaining its achievements, say state media
By Chua Chin Hon
BEIJING - China's ruling Communist Party must adapt to the changing times if it is to succeed in leading the country through the breakneck pace of economic and social changes, state media said yesterday as a key meeting focused on shoring up the leadership's governance entered its second day.
The country's top communist leaders have been meeting behind closed doors at the Jinxi Hotel in the western part of Beijing since Thursday for the Fourth Plenum of the 16th Communist Party Central Committee.
Topping the agenda at the four-day meeting is the discussion on how the Chinese Communist Party (CCP) can improve its 'ruling capability' - a topic that has attracted some unusually frank criticism in the state media recently.
In an editorial yesterday, the English-language China Daily said that economic growth and material wealth alone would not be enough to help the country grow further.
'The ruling party is having a tough job sustaining what it has achieved and letting all members of society share the fruits of its prosperity,' it added.
'China's economic and social transition has reached a crucial point, setting an unprecedented test for the party's competence to govern the country.'
That the Communist Party should put its 'ruling capability' up for open discussion for the first time in its 55-year rule prompted many analysts to interpret it as an implicit admission of the party's waning legitimacy.
Despite long-running anti-graft campaigns, the top Chinese leadership has had limited success in reining in widespread corruption and official abuses which have severely dented the ruling party's image in the eyes of ordinary Chinese.
'The party still suffers from incompetent leading cadres, loopholes in governance and supervision and immature governing mechanisms,' the official Xinhua news agency said in a news commentary late on Thursday.
The report also trotted out a recent survey of party cadres to illustrate the extent to which their 'ruling capability' has been found wanting.
For instance, 67 per cent of the cadres felt that they were not competent enough in tapping the market economy while 58 per cent said they lacked the ability to make a decision based on 'scientific judgment'.
'More than one third either had difficulty tackling a complicated situation or totally lost their heads in such a situation,' Xinhua added.
Political reforms aimed at tackling such issues are expected to be announced at the plenum's closing tomorrow.
However, the international media has so far been more curious about the fate of former president and ageing strongman Jiang Zemin.
Rumours of his retirement at the Fourth Plenum reached fever pitch in the run-up to the meeting.
There has been neither official denial nor confirmation to date.
But tellingly, all major party newspapers such as the People's Daily yesterday ran a front-page article in the prominent top right hand corner announcing that the military supremo had signed a new order to the People's Liberation Army - signalling that Mr Jiang is not about to exit stage left.
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Pressures for Expanding Local-Level Democracy
Joseph Fewsmith
The Chinese Communist Party (CCP) has faced numerous pressures in recent years to reform its governing practices, particularly at the local level where these practices directly affect the lives of citizens. Despite years of campaigning against it, corruption continues to get worse; the abuse of power by local officials has inflamed relations with the local citizenry; and there seems to be a palpable need to enhance the legitimacy of local officials. Village-level elections were introduced in China in the late 1980s to respond to such needs, but they created new problems: party secretaries clashed regularly with village heads, and township cadres resented newly assertive village leaders. Moreover, the electoral process stalled as efforts to promote it at the township level met resistance. In recent months, however, there have been new and expanded experiments with local-level democracy involving increasing the importance of local people's congresses, opening up the electoral process, and using some form of election to choose local cadres. Importantly, these experiments are not limited to the village level but are taking place at the township and sometimes county levels. Such innovations may not be the harbinger of democratization, but they do reflect increased pressures to cope with the problems of local governance.
Local governance has been a troubled area in China in recent years. Although village elections, started in 1987, offered hope of better governance and more democratic choice, their implementation has been uneven at best, and they have not yet been permitted to move up to the township level on a regular basis. Meanwhile, tensions between local cadres and peasants have increased. Yu Jianrong, a researcher at the Chinese Academy of Social Sciences (CASS), has written vividly of peasants' efforts to resist the tax burden imposed on them.1 Not coincidentally, Zhao Shukai of the State Council's Development Research Center has depicted local government as ever more focused on the task of revenue collection.2 Chen Kuidi and Chun Tao's Zhongguo nongmin diaocha (Investigation of China's peasants), which became a best-seller this year before it was banned, has similarly described the poverty and oppression of China's peasants.3 Over the past year or so, there have been notable efforts to reduce this tax burden, but they have only shifted the focus of peasant protests to disputes over land rights.4 Good governance has been in very short supply; Shanghai researcher Xiao Gongqin has warned of the development of "sultanism" at the local level.5 Breaking this cycle of political oppression, excessive taxation, resistance, and violence has become a major focal point for researchers and policy advisers in China, as well as an object of citizen activism. Xinwen zhoukan (Newsweek) labeled 2003 the year
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of the "new popular rights movement" because of the many efforts to use legal means to articulate and protect the rights of citizens.6 Two major reflections of this trend have been the expansion of citizen participation in local people's congress elections and Chinese Communist Party efforts to develop "inner-party democracy" (dangnei minzhu) in response to problems at the local level.
Township People's Congresses
According to China's election law, people's congresses (the legislative body) below the county level (meaning the township level in the countryside and either the municipality or the district level in large urban areas) are to be elected directly. This stipulation has not, generally speaking, led to an expansion of democratic rights, because the nomination process has been dominated by higher-level authorities and because localpeople's congresses have been toothless, rubber-stamp bodies. Whereas the National People's Congress (NPC) has acquired some saliency in the political process, that development had not been duplicated at the local level. In recent years, especially in2003, that situation has begun to change. The election law includes provisions for selfnominated candidates (candidates can get on the preliminary ballot if more than 10 people sign a petition in support of their candidacy) as well as for write-in candidates. Whereas self-nominated candidates are generally eliminated by the local election commission, which goes through a process of "fermentation" (yunniang) and discussion to decide on formal candidates (there is no requirement for a primary election), some have been allowed to get on the ballot and even be elected in recent years. Along with this slight opening of the electoral process has come greater electoral campaigning, including the use of the Internet, campaign flyers, and even posters. Below, we look at several cases that have become well known in China but are rarely covered abroad.
Antecedents in Hubei
Born in 1958, Yao Lifa, of Qianjiang City in the central province of Hubei, was apparently the first person in China elected through self-nomination to a municipal-level people's congress. Apparently ambitious, Yao, who has a vocational school education and works at an elementary school, began competing for a seat in the local people's congress in 1987, when the election law was first promulgated. The law allows for selfnominated candidates, and Yao used this provision to run for office. Twelve years later, in 1999, he was finally successful. Over the course of the next five years, Yao was a busy and controversial figure--he raised 187 of the 459 suggestions, opinions, and criticisms presented to the local people's congress. Yao also undertook a survey of the 329 villages under Qianjiang City and found that 187 village chairmen and 432 vice chairmen and village committee members in 269 villages who had been elected in 1999--some 57 percent of the total--had been dismissed over the course of the following three years.7
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In 2003, Yao and 40 other people--including teachers, village heads, lawyers, workers, and peasants--put themselves forward as candidates for the Qianjiang Municipal People's Congress, and 32 of them became formal candidates. In an election fraught with controversy, the whole group of self-nominated candidates lost the election, though Yao at least vowed to run again in the next election. Because Yao and the others were not backed by local authorities, their only chance of being elected was to wage a write-in campaign. Yao had succeeded in doing so in 1999, but local authorities were determined to prevent more than one successful write-in campaign in 2003. As Li Fan put it, the local administration felt it was bad enough to have one Yao Lifa in the people's congress; they would not have been able to tolerate 32 Yao Lifas!8
In 2001, L? Banglie of Baoyuesi Village in Zhijiang City, Hubei, was angry at the way local cadres demanded taxes despite the failure of his (and the rest of the villagers') crops. After failing in his petitions to the township authorities, L? traveled to Beijing. After a few weeks, township cadres brought him back to Hubei, saying that everything would be resolved. When matters were not resolved, L? returned to Beijing in December, but he was again brought back by local officials. In April 2002, after reading Li Changping's best-seller, Telling the Truth to the Premier, L? returned to Beijing, where he sought out Li Changping. Later, back home in Hubei, other villagers sought out L? to discuss their charges against local officials--that when flooding forced them to move, the government had allocated 15,000 yuan in compensation, but township authorities had distributed only 13,000 yuan. So off to Beijing went L? Banglie once again.
In November 2002, having learned something of China's laws, L? ran for village head, winning the highest number of votes. Complaints arose that his hukou was not in that village, and L?'s candidacy was disallowed. In January 2003, L? returned again to Beijing, where he participated in a training class organized by CASS and other organizations. Understanding more about China's laws, he returned to his township and demanded that the village election be investigated, enforcing his demand with a hunger strike. In June, he organized a petition to recall the village head and got 709 of the 2,152 villagers to sign, well over the one-fifth needed. Shortly thereafter he was assaulted by three youths who beat him with clubs. When he did not drop his campaign to recall the village head, he was beaten yet again--resulting in a 43-day hospital stay. As the year-end election for people's congress approached, L? began thinking about running for office. He contacted Yao Lifa, and soon used Yao's method of organizing a write-in campaign. On December 6, 2003, L? was elected to the township people's congress with 4,551 votes out of a possible 6,000-plus ballots. L?'s struggle for justice suggests not only his own stubbornness, but also the willingness of local officials to use all sorts of methods, including physical violence, to prevent people like L? from becoming members of the local people's congress. In 2000, one Zhang Jiagui was elected village head in a village not far from L?'s, but because he insisted on clearing up public finances from the preceding period, he was beaten to death.
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In Songci Municipality, across the Yangtze River from Zhijiang, one Yang Changxin, who was a member of the local people's congress, was arrested and sentenced to jail for three years for disturbing the public order. The struggle to break the hold of the local political elite is not only difficult but also dangerous.9
The 2003 Shenzhen Election
In April and May 2003, districts under Shenzhen Municipality in Guangdong held elections for the local people's congresses. Whereas previously nominations, aselsewhere in China, were controlled and manipulated by higher authorities, this time 10 or more self-nominated candidates took part in the election, two of whom were elected. Whether resulting in election victories or not, each of these candidacies challenged to a greater or lesser extent the old ways of doing things while reflecting social change. One interesting case is that of Xiao Youmei, a 48-year-old woman who had been elected to the municipal people's congress in 2000. Believing that her chances in the next election were not good (for reasons unexplained), Xiao decided that she would run for the people's congress in the district where she lived, Luohu District. She was able to collect 33 signatures to put herself on the ballot, but she was the weakest of the three candidates. Those who had supported her nomination were the retired and unemployed, while the other two candidates were backed by large work units.
In April 2003, a meeting was held to introduce the candidates to voters'
representatives, but only 15 representatives attended the meeting, and Xiao realized that it would be impossible to introduce herself to the voters in this fashion. Faced with the indifference of residents' committees to her pleas to meet the voters, Xiao and herhusband decided to print up campaign posters to introduce her credentials and experience to the voters. Her slogan was, "Listen to the voices that come from the grass roots, supervise the government's work style and political reform, reflect the desires of the broad masses, and be a bridge between the government and the citizens."
Xiao's election poster was a first in China. Local residents' committees were skeptical, so Xiao turned to the district election commission for a decision. In an equivocal but nonetheless surprising decision, the election commission ruled that it would neither support nor oppose putting up posters; local residents' committees "may support" (peihe) her.10 Unfortunately for Xiao, security at the first work unit she went to would not let her post her campaign material, and security at the second ripped it down. After the intervention of the district election commission, she was allowed to put up her poster in several prominent places, thus drawing much attention. In the end, however, these efforts were not enough. Xiao received 191 votes, much better than expected but not more than half of the 809 votes cast.11
Xiao Youmei obviously failed in her quest to be elected, but her campaign activities inspired others, and the relatively enlightened response of the district election commission suggested a willingness to adjust to the changing needs of society.
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One person inspired by Xiao Youmei was Wu Haining, who read about Xiao's campaign posters in the April 22, 2003, edition of Nanfang dushi bao (Southern metropolitan daily). Wu had been nominated through the support of 151 people, but the election, originally scheduled to be held on April 23, was canceled after another candidate suddenly withdrew. Wu immediately complained about the canceled election, and the district election commission decided that the election would be held on May 9. Besides Wu, the other candidate would be one Chen Huibin, head of the residents' committee in that area as well as head of the election commission leadership small group. Realizing that he was at a disadvantage, Wu visited Xiao to see her campaign poster. On May 6, Wu posted his own campaign material in several places and stuffed some 1,900open letters in residents' mailboxes. Although he was subjected to pressure from officials, his posters were not torn down. The day before the election, the election commission posted a new list of voters' names. The list contained 849 names, 189 more than the list had had when voter registration was closed on April 3.
Wu lost the election, but he did not yield. Rather than concede defeat, he issued a statement that questioned the election procedures. He also filed a complaint with the municipal people's congress (no decision has been reached as of this writing).12 On May 25, some 33 voters signed a petition calling for Chen Huibin's removal.13 People's Daily weighed in on the side of the petitioners, saying that the drive to remove Chen, whether successful or not, "will have considerable impact on the improvement of the people's congress system in China, promotion of the process of grassroots democracy, and still more sufficient protection of voters' democratic rights."14
Another person to run for election was much more of an insider than either Xiao or Wu. Wang Liang had been sent to the United States to study for his master's inpublic administration, which he received in 2002. Returning to Shenzhen, Wang was appointed principal and party secretary of the Shenzhen High-Tech and Industrial School. He was also qualified as an accountant and a lawyer, and was studying for his doctorate. In late April 2003, Wang decided to declare his own candidacy, only to discover that the students and staff at his school had been left off the voter registration rolls, making him ineligible to run. After talking to students and staff at the school, Wang called the district election commission to say that he wanted to run. The election commission supported his effort, but because formal nominations were over, it suggested he run a write-in campaign. It also allowed the students and staff to register to vote. Wang noted that the campaigns of Xiao Youmei and Wu Haining had stirred controversy, so he adopted a lower-key style, printing up very simple campaign sheets. In the end, he won the district election to the people's congress with the highest vote total.15
The Beijing Election
China's media were supportive of Shenzhen's election, and in August 2003 the People's Daily web site carried an article saying that "increasing the number of selfnominated candidates allows the masses to better select their own spokespersons,
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enlarges the scope of orderly participation in politics by the citizens, enriches the elections of people's congresses, and infuses fresh content into the people's congresses' work."16 So a more open atmosphere was extant as the Beijing district people's congress elections approached.
In these elections more than 20 self-nominated candidates took part, although only three were elected. One was Xu Zhiyong, a 30-year-old instructor in the law schoolat Beijing Postal Academy. Xu was one of three law professors who had posted an appeal on the Internet after Sun Zhigang was beaten to death in detention in May 2003. That appeal led to the revision of the People's Republic of China's (PRC) law on detention. In October of the same year, Xu was the lawyer who argued on behalf of Sun Dawu, a wealthy entrepreneur who had been detained on trumped-up charges. In November, Xu declared himself a self-nominated candidate for the local people's congress in Beijing's Haidian District (the area in the northwest of the city where most of the universities are located). He posted an appeal for support on the Internet, and within three hours had received over 700 responses. Xu also received the support of his school, and on December 10 he was elected with the highest number of votes--some 10,106 out of 12,609 cast. Since Xu was supported by his school, his candidacy cannot be considered an "opposition" candidacy, but his involvement in the Sun Zhigang and Sun Dawu cases certainly reflects a willingness to challenge the status quo.17
Another candidate was Nie Hailiang, one of six property owners (yezhu) who presented themselves as self-declared candidates. Nie had a master's degree from Qinghua University in environmental science and engineering, and he had gone on toopen a company dealing with energy management. He was also the developer of the Yunquyuan residence in the Huilongguan community. Originally, three property owners from the same district were planning to participate in the election, but the other two dropped out so that support could be concentrated on Nie. In the end, Nie received about two-thirds of the votes in that district. Nie's election, like the candidacy of Wu Haining in Shenzhen, represented a new phenomenon--property owners banding together to protect their rights through the electoral process.18
The other self-nominated candidate to win election in Beijing was Ge Jinbiao, a 35-year-old with a doctorate in law who was an instructor at the law school at Beijing Industrial and Commercial University. A total of 276 people received votes in the first round of the election (competing for three seats), and none of the candidates surpassed the required 50 percent of the votes. By placing third in the voting, Ge secured himself a place on the final ballot along with the three officially backed candidates. Like other self-nominated candidates, Ge placed a lot of effort into campaigning. He went to the student dorms and passed out thousands of campaign brochures, promising to serve the interests of the voters and to protect the interests of the students. When the votes were counted on December 16, Ge placed first, with a total of 7,839 votes out of 11,512 ballots.19
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It should also be noted that Yao Yao, the 20-year-old son of Yao Lifa who is a law major at China Politics and Law University, was one of the other self-declared candidates.20 Another was Shu Kexin, who attracted a great deal of attention for his attempts to create a campaign office that was staffed with volunteers to shape his media image and try to persuade potential voters. One of Shu's campaign aides noted in an interview that the candidate had been inspired by Yao Lifa.21
Political Reform in Pingba
The initiatives to push the bounds of political reform discussed above all involved efforts to invigorate the district and township people's congresses. They also were marked by attempts to open up the system, with or without the support of higher levels, and introduce new modes of participation, including campaigning and the use of write-in candidacies. In Pingba Township in Chengkou County in Chongqing Municipality, there was a much broader push to reform the political system, including increasing the importance of the people's congress, and it was led by the local CCP branch. These measures were approved by a township-level party plenum and a simultaneous meeting of the township people's congress. The reform consisted of the following aspects:
1. Selection of the township party secretary would be in accordance with the three-ballot system. First, if the number of candidates for party secretary were to exceed one, then the party congress would hold a primary to determine primary candidates. Second, formal candidacy would be decided by a vote of all residents (whether members of the CCP or not). Finally, all party members in the township would choose among the formal candidates. The township head would be elected by direct vote of all residents. The newly elected township head would then select his or her own "cabinet," subject to the approval of the township people's congress.
2. A party congress standing committee would be established at the township level. The standing committee would meet every three months (considerably more often than the usual proposal to have it meet once a year).
3. Similarly, the township people's congress would establish a standing committee. Each of Pingba's 17 electoral districts would choose one person from its delegation to the people's congress to serve on the standing committee. The standing committee would meet every two months. Specialized representatives (presumably those with more knowledge of such topics as public finance) could meet on an ad hoc basis.
4. A new relationship would be established among the party, the government, and the local people's congress. The party committee would no longer interfere in the work of the government. The party committee would be restricted to deciding on major matters to be executed by the local government and supervising the implementation of resolutions passed by the local people's congress. The party committee would also be responsible for supervising the conduct of its own members.
5. An inner-party supervisory mechanism would be instituted.
6. The government would also be under the comprehensive supervision of the local people's congress.
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7. Public finance would be made open, and the government's budget would have to gain the approval of the local people's congress as well as be subject to supervision during its implementation. On August 26, 2003, three candidates for township party secretary in Pingba put forth their governing platforms and responded to questions from the audience (which was open to the general public as well as local cadres). A lively discussion then took place covering all matters of local concern, including education, transportation, the environment, family planning, land distribution, and so forth. On August 28, just as final preparations for the election were getting under way, the county party committee ordered the election and the reform stopped. Moreover, the county party committee put the Pingba Township party secretary, Wei Shengduo, under "dual supervision" and appointed a new party secretary. After two weeks, Wei was allowed to return home, but was left awaiting higher levels' decision on his next job assignment, if any.22
It does not seem strange that this reform plan was stopped by higher-level party officials; what is intriguing is that the plan went as far as it did and that party officials at the township level approved it. Allowing the public to vote for a party secretary at the township level--if only in the form of an opinion poll--is unprecedented, but what is unique, and in accord with the other examples looked at in this analysis, is that the plan envisioned a far greater role for the local people's congress. Most townships are scheduled to reelect their people's congresses in late 2004 and in the first half of 2005,making the various trends traced here relevant as we go forward.
Inner-Party Democracy
Inner-party democracy--an old topic in the CCP lexicon--has been revived in recent years as another way of channeling the calls for reform at the local level. In particular, calls for inner-party democracy are a direct response to village elections: once people could elect the village chief, people began to ask why they could not also elect the village secretary. In addition, inner-party democracy is seen by party researchers as a way of breaking up the corruption and personal networks that are associated with having power concentrated in the hands of the "number one leader" (yi ba shou) at each level.23 Implementation of the three-ballot system in Baicheng City in Jilin Province to decide cadre promotions was described in a previous issue of China Leadership Monitor.24 That experiment started in 2000, when the newly installed party secretary found himself under so much pressure from leaders at different levels to promote one person or another that he finally decided to open up the process and promote cadres through democratic mechanisms. The experiment remains limited because it is restricted to the section (chu) level, but it did receive the endorsement of higher levels in the party.25
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In Sichuan Province, which has pioneered many of the experiments in local democracy, the party secretary of Pingchang County designated one-third of the townships under his administration to experiment with direct election of the township party secretary by all party members in that jurisdiction. In one of those townships, Lingshan, eight party members competed for five positions in what the press hailed as a "breakthrough" in the cadre selection process.26 Recently the CCP Organization Department in Sichuan declared that cadres at and below the county level must be recommended by the "masses."27 If implemented, that policy would mark a substantial raising of the level at which some form of democratic process is used. Other experiments are taking place elsewhere in the country. For instance, Luotian County in Hubei Province replaced its CCP standing committee with a broader 15-person committee elected directly by the party congress--which also meets annually to monitor affairs.28
Notes
1 Yu Jianrong, "The Evil Forces in the Rural Areas and the Deterioration of Grassroots Administration--A Survey of the South Area of Hunan," Zhanlue yu guanli, September 1, 2003, 1-14, trans. FBIS CPP-2003-1008-000183.
2 Zhao Shukai, "Governance in Villages: Organization and Conflict," Zhanlue yu guanli, November 1, 2003, 1-8, trans. FBIS CPP-2004-0102-000114.
3 Chen Kuidi and Chun Tao, Zhongguo nongmin diaocha (Investigation of China's peasants) (Beijing: Renmin wenxue chubanshe, 2004).
4 Yu Jianrong, "Tudi wenti yicheng wei nongmin weiquan kangzheng de jiaodian" (The land problem has already become the focal point in peasants' protests and efforts to uphold rights) (n.p., n.d.).
5 Xiao Gongqin, "Jingti defang quanli `Sudanhua' xianxiang" (Beware of the `sultanization' of power at the local level), Neibu canyue, 2003, no. 10 (March 14).
6 Li Fan, ed., Zhongguo jiceng minzhu fazhan baogao (Grassroots democracy in China) (Beijing: Fal? chubanshe, 2004), 5.
7 Huang Guangming and He Hongwei, "Striking Dilemma in Grassroots Administration in Dianjiang [sic, Qianjiang] Village [sic, City], 187 Elected Village Officials Dismissed in Three Years," Nanfang zhuomo, September 12, 2002, trans. FBIS CPP-2002-0916-000029, and Dang Guoying, "The Reality and Future of Villagers' Autonomy," Nanfang zhuomo, September 30, 2002, trans. FBIS CPP-2002-1008-0000051.
8 Li Fan, ed., Zhongguo jiceng minzhu fazhan baogao, 158.
9 Ibid., 168-76.
10 Ibid., 75.
11 Ibid., 78. See also Yi Ying, "Shenzhen's Election Campaign Storm," Nanfang zhuomo, May 29, 2003,
trans. FBIS CPP-2003-0606-000021.
12 Li Fan, ed., Zhongguo jiceng minzhu fazhan baogao, 40-41.
13 China Daily, August 9, 2003.
14 Renmin ribao (Internet version), June 27, 2003, trans. FBIS CPP-2003-0707-000142.
15 Li Fan, ed., Zhongguo jiceng minzhu fazhan baogao, 43-44.
16 Ibid., 122-23.
17 Ibid., 125-26.
18 Ibid., 127.
19 Ibid., 128.
20 Irene Wang, "A Whiff of Freedom in Beijing Election," South China Morning Post, November 21, 2003.
21 Lin Chufang, "Penetrating Deeply into the Depths of Success: A Campaign Office for an Independent Candidate Quietly Opens Its Doors," Nanfang zhuomo, October 30, 2003, trans. FBIS CPP-2003-1103-0000007.
22 Li Fan, ed., Zhongguo jiceng minzhu fazhan baogao, 179-235.
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23 Interviews in Beijing, August 2004.
24 Joseph Fewsmith, "The Third Plenary Session of the 16th Central Committee," China Leadership Monitor 9 (winter 2004).
25 Interviews in Beijing, August 2004.
26 "Direct Elections Move to Township Level," China Daily, May 18, 2004, and Li Wei, "Political Achievements of the `Openly Nominated and Directly Elected Secretary,'" Sichuan ribao, trans. FBIS CPP-2004-0130-000043.
27 Min Jie, "Sichuan: Cadres Must Be Selected through Mass Nomination--Those without Democratic Recommendation or Not Approved Of by Majority of Masses in Democratic Recommendation Cannot Be Named as Candidates to Be Examined for Filling Vacant Posts," Zhongguo qingnian bao, August 3, 2004, trans. FBIS CPP-2004-0803-000075.
28 "China's Ruling Party Seeks to Decentralize Power," Xinhua News Agency (English), July 1, 2004, FBIS CPP-2004-0701-000219.

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>> IRAQ

Turkey snaps over US bombing of its bretheren
By K Gajendra Singh
For the first time since the acrimonious exchange of words in July last year following the arrest and imprisonment of 11 Turkish commandos in Kurdish Iraq, for which Washington expressed "regret", differences erupted publicly this week between North Atlantic Treaty Organization allies Turkey and the US over attacks on Turkey's ethnic cousins, the Turkmens in northern Iraq.
Talking to a Turkish TV channel, Foreign Minister Abdullah Gul warned that if the US did not cease its attacks on Tal Afar, a Turkmen city at the junction of Turkey, Iraq and Syria, Ankara might withdraw its support to the US in Iraq.
"I told [US Secretary of State Colin Powell] that what is being done there is harming the civilian population, that it is wrong, and that if it continues, Turkey's cooperation on issues regarding Iraq will come to a total stop." He added, "We will continue to say these things. Of course we will not stop only at words. If necessary, we will not hesitate to do what has to be done."
Turkey is a key US ally in a largely hostile region. US forces use its Incirlik military base near northern Iraq. Turkish firms are also involved heavily in the construction and transport business in Iraq, with hundreds of Turkish vehicles bringing in goods for the US military every day. It is an alternative route through friendly northern Kurdish territory to those from Jordan and Kuwait. But many Turks have been kidnapped by Iraqi insurgent groups and some have been killed.
Turkey contains a large ethnic Turkmen population and Ankara has long seen itself as the guardian of their rights, particularly across the border in northern Iraq, where they constitute a significant minority.
The US attacks on Tal Afar, which Iraqi Turkmen groups in Turkey say have left 120 dead and over 200 injured, were launched, the US says, to root out terrorists. The US has denied the extent of the damage, saying that it avoided civilian targets and killed only terrorists it says were infiltrating the town from Syria.
US ambassador to Turkey Eric Edelman commented, "We are carrying out a limited military operation and we are trying to keep civilian losses to a minimum. We cannot completely eliminate the possibility [of civilian casualties] ... We believe the operation is being conducted with great care," he said after briefing Turkish officials. There have not been any reports of further attacks since the Turkish warning.
The deterioration in US-Turkish relations underlines the fast-changing strategic scenario in the region in the post-Cold War era after the collapse of the Soviet Union, the September 11 attacks on the US, the US-led invasion on Iraq, now conceded as illegal by United Nations Secretary General Kofi Annan, and the deteriorating security situation in that country.
Despite negative signals on Ankara's mission to join the European Union, Turkey is moving away from the US and closer to the EU - it is even looking to buy Airbuses, and arms, from Europe rather than the US.
At the same time, Turkey is drawing closer to Syria, normalizing relations with Iran and improving economic relations with Russia, as well as discuss with Moscow ways to counter terrorist acts, from which both Russia and Turkey suffer. Russian President Vladimir Putin called off a visit to Turkey when the hostage crisis broke at Beslan in the Russian Caucasus last week.
And Turkey has also moved away from long-time friend Israel, the US's umbilically aligned strategic partner in the Middle East. Turkey has accused Israel of "state terrorism" against Palestinians. A recent ruling party team from Turkey returned from Tel Aviv not satisfied with Israeli explanations over charges that it was interfering in northern Iraqi affairs.
With newspapers full of stories and TV screens showing the Turkmens being attacked in the US operations at Tal Afar, many Turks are angry at what is being done to their ethnic brethren. These have been large protests outside the US Embassy in Ankara, and the belief that the US attacks are a part of a campaign to ethnically cleanse the Turkmens from northern Iraq is widespread.
"Some people are uncomfortable with the ethnic structure of this area, so, using claims of a terrorist threat, they went in and killed people," said Professor Suphi Saatci of the Kirkuk Foundation, one of several Turkmen groups in Turkey.
He claims that the the attacks are a part of a wider campaign to establish Kurdish control over all of northern Iraq, and he points to the removal of Turkmen officials from governing positions in the region to be replaced by Kurds. He also says that the Iraqi police force deployed in northern Iraq is dominated by members of Kurdish factions. "The US is acting completely under the direction of the Kurdish parties in northern Iraq," says Saatci. "Tal Afar is a clearly Turkmen area and this is something they were very jealous of."
While Kurdish officials deny any attempt to alter the ethnic balance in the region, last week Masud Barzani, leader of one of the two largest Kurdish parties, the Kurdish Democratic Party (KDP), said that Kirkuk "is a Kurdish city" and one that the KDP was willing to fight for, which certainly did not calm fears of the Turkmens and angered the Turks. Many Turkmen see Kirkuk as historically theirs. Turkey considers northern Iraq - ie Kurdistan - as part of its sphere of influence, especially the Turkmen minority. Ankara is especially concerned that the Kurds in Iraq don't gain full autonomy as this would likely fire the aspirations of Turkey's Kurdish minority.
The US military disputes that its forces laid siege to Tal Afar, saying that the operation was to free the city from insurgents, including foreign fighters, who had turned it into a haven for militants smuggling men and arms across the Syrian border. And a military spokesman denied that Kurds were using US forces to gain the upper hand in their ethnic struggle with the Turkmens. The US characterized the resistance in Tal Afar as put up by a disparate group of former Saddam Hussein loyalists, religious extremists and foreign fighters who were united only by their opposition to US forces.
Gareth Stansfield, a regional specialist at the Center of Arab and Islamic Studies at Britain's University of Exeter, said recently that "the most important angle of what the Turkish concern is [and that is] that there is a strong belief in Ankara that Iyad Allawi, the Iraqi prime minister, and the Americans, were suckered into attacking Tal Afar by Kurdish intelligence circles, and really brought to Tal Afar to target ostensibly al-Qaeda and anti-occupation forces with the Kurds knowing full well that this would also bring them up against Turkmens and create a rift between Washington and Ankara over their treatment of a Turkmen city."
Turkey maintains a few hundred troops in the region as a security presence to monitor Turkish Kurd rebels who have some hideouts in the region. But any large-scale presence has been derailed by the objections of Iraqi Kurdish leaders. "That has created an uneasy state of co-existence between Ankara and the two major Kurdish political parties, the Kurdish Democratic Party and Patriotic Union of Kurdistan, a balance which any US military operation in the area could easily disturb."
Stansfield added that the incident shows how volatile tensions remain between Ankara and the Iraqi Kurds, despite ongoing efforts by both sides to work together. "The Turkish position has become increasingly more sophisticated over the last months, and arguably years, with Ankara finding an accommodation with the KDP and PUK and beginning to realize that while it is not their favored option to allow the Kurds to be autonomous in the north of Iraq, it is perhaps one of the better options that they are faced with in this situation," said Stansfield.
He added, "However, the relationship between the two principle Kurdish parties and the government of Turkey will always be sensitized by the Kurds' treatment of Turkmens and indeed now the American treatment of Turkmens vis-a-vis Kurds."
Transfer of sovereignty and the Kurds
In January this year, the then Iraqi Governing Council agreed to a federal structure to enshrine Kurdish self-rule in three northern provinces of Iraq. This was to be included in a "fundamental law" that would precede national elections in early 2005. The fate of three more provinces claimed by the Kurds was to be decided later. "In the fundamental law, Kurdistan will have the same legal status as it has now," said a Kurdish council member, referring to the region that has enjoyed virtual autonomy since the end of the 1991 Gulf War.
"When the constitution is written and elections are held, we will not agree to less than what is in the fundamental law, and we may ask for more," said the Kurdish council member. Arabs, Turkmens, Sunnis and Shi'ites expressed vociferous opposition to the proposed federal system for Kurdish Iraq. They organized demonstrations leading to ethnic tensions and violence in Kirkuk and many other cities in north Iraq. Many protesters were killed and scores were injured.
However, when "sovereignty" was transferred on June 30 to the interim government led by Iyad Allawi, the interim constitutional arrangement did not include a federal structure for Kurdish self-rule, although to pacify the Kurds, key portfolios of defense and foreign affairs were allotted to them.
A press release from the Patriotic Union of Kurdistan (PUK) stated that "the current situation in Iraq and the new-found attitude of the US, UK and UN has led to a serious re-think for the Kurds. The proposed plans do not seem to promise the expected Kurdish role in the future of a new Iraq. The Kurds feel betrayed once again." It added that "if the plight of the Kurds is ignored yet again and we are left with no say in the future of a new Iraq, the will of the Kurdish people will be too great for the Kurdish political parties to ignore, leading to a total withdrawal from any further discussions relating to the formation of any new Iraqi government. This will certainly not serve the unity of Iraq." Underlining that the Kurds have been the only true friends and allies of the US coalition, the release concluded that "the Kurds will no longer be second-class citizens in Iraq". However, the Kurds did not precipitate matters.
Demographic changes in north Iraq
Kirkuk, with a population of some 750,000, and other towns are now the scene of ethnic and demographic struggles between Turkmens, Arabs and Kurds, with the last wanting to take over the region and make the city a part of an autonomous zone, with Kirkuk as its capital.
The area around Kirkuk has 6% of the world's oil reserves. In April 2003, it was estimated that the population was 250,000 each for Turkmen, Arab and Kurd. A large number of Arabs were settled there by Saddam Hussein, and they are mostly Shi'ites from the south. The Turkmens are generally Shi'ites, like their ethnic kin, the Alevis in Turkey, but many have given up Turkmen traditions in favor of the urban, clerical religion common among the Arabs of the south. Kirkuk is therefore a stronghold of the Muqtada al-Sadr movement which has given US-led forces such a hard time in the south in Najaf. The influential Shi'ite political party, the Supreme Council for Islamic Revolution in Iraq (SCIRI), also has good support, perhaps 40%, in the region. Kurds are mostly Sunnis, and were the dominant population in Kirkuk in the 1960s and 1970s, before Saddam's Arabization policy saw a lot of Kurds moved further north.
According to some estimates, over 70,000 Kurds have entered Kirkuk over the past 17 months, and about 50,000 Arabs have fled back to the south. It can be said, therefore, that now there are about 320,000 Kurds and 200,000 Arabs in the city. The number of Turkmen has also been augmented. During the Ottoman rule, the Turkmen dominated the city, and it was so until oil was discovered. It is reported that, encouraged by the Kurdish leadership, as many as 500 Kurds a day are returning to the city. The changes are being carried out for the quick-fix census planned for October, which in turn will be the basis for the proportional representation for the planned January elections, if these are even held, given the country's security problems. Both the Turkmens and Arabs have said that the Kurds are using these demographic changes to engulf Kirkuk and ensure that it is added to the enlarged Kurdish province which they are planning. The Kurds hope to get at least semi-autonomous status from Baghdad.
North Iraq and Turkey's Kurdish problem
Turkey has serious problems with its own Kurds, who form 20% of the population. A rebellion since 1984 against the Turkish state led by Abdullah Ocalan of the Marxist Kurdistan Workers Party (PKK) has cost over 35,000 lives, including 5,000 soldiers. To control and neutralize the rebellion, thousands of Kurdish villages have been bombed, destroyed, abandoned or relocated; millions of Kurds have been moved to shanty towns in the south and east or migrated westwards. The economy of the region was shattered. With a third of the Turkish army tied up in the southeast, the cost of countering the insurgency at its height amounted to between $6 billion to $8 billion a year.
The rebellion died down after the arrest and trial of Ocalan, in 1999, but not eradicated. After a court in Turkey in 2002 commuted to life imprisonment the death sentence passed on Ocalan and parliament granted rights for the use of the Kurdish language, some of the root causes of the Kurdish rebellion were removed. The PKK - now also called Konga-Gel - shifted almost 4,000 of its cadres to northern Iraq and refused to lay down arms as required by a Turkish "repentance law". The US's priority to disarm PKK cadres was never very high. In fact, the US wants to reward Iraqi Kurds, who have remained mostly peaceful and loyal while the rest of the country has not.
Early this month, Prime Minister Recep Tayyip Erdogan said that Turkey's patience was running out over US reluctance to take military action against Turkish Kurds hiding in northern Iraq. In 1999, the PKK declared a unilateral ceasefire after the capture of its leader, Ocalan. But the ceasefire was not renewed in June and there have been increasing skirmishes and battles between Kurdish insurgents and Turkish security forces inside Turkey. Turkey remains frustrated over US reluctance to employ military means against the PKK fighters - in spite of promises to do so.
Iraqi Kurds have been ambivalent to the PKK, helping them at times. Ankara has entered north Iraq from time to time - despite protests - to attack PKK bases and its cadres. Ankara has also said that it would regard an independent Kurdish entity as a cause for war. It is opposed to the Kurds seizing the oil centers around Kirkuk, which would give them financial autonomy, and this would also constitute a reason for entry into north Iraq. The Turks vehemently oppose any change in the ethnic composition of the city of Kirkuk .
The Turks manifest a pervasive distrust of autonomy or models of a federal state for Iraqi Kurds. It would affect and encourage the aspirations of their own Kurds. It also revives memories of Western conspiracies against Turkey and the unratified 1920 Treaty of Sevres forced on the Ottoman Sultan by the World War I victors which had promised independence to the Armenians and autonomy to Turkey's Kurds. So Mustafa Kemal Ataturk opted for the unitary state of Turkey and Kurdish rebellions in Turkey were ruthlessly suppressed.
The 1980s war between Iraq and resurgent Shi'ites in Iran helped the PKK to establish itself in the lawless north Kurdish Iraq territory. The PKK also helped itself with arms freely available in the region during the eight-year war.
The 1990-91 Gulf crisis and war proved to be a watershed in the violent explosion of the Kurdish rebellion in Turkey. A nebulous and ambiguous situation emerged in north Iraq when, at the end of the war, US president Bush Sr encouraged the Kurds (and the hapless Shi'ites in the south) to revolt against Saddam's Sunni Arab regime. Turkey was dead against it, as a Kurdish state in the north would give ideas to its own Kurds.
Saudi Arabia and other Arab states in the Gulf were totally opposed to a Shi'ite state in south Iraq. The hapless Iraqi Kurds and Shi'ites paid a heavy price. Thousands were butchered. The international media's coverage of the pitiable conditions, with more than half a million Iraqi Kurds escaping towards the Turkish border from Saddam's forces in March 1991, led to the creation of a protected zone in north Iraq, later patrolled by US and British war planes. The Iraqi Kurds did elect a parliament, but it never functioned properly. Kurdish leaders Massoud Barzani and Jalal Talabani run almost autonomous administrations in their areas. This state of affairs has allowed the PKK a free run in north Iraq.
After the 1991 war, Turkey lost out instead of gaining as promised by the US. The closure of Iraqi pipelines, economic sanctions and the loss of trade with Iraq, which used to pump billions of US dollars into the economy and provide employment to hundreds of thousands, with thousands of Turkish trucks roaring up and down to Iraq, only exacerbated the economic and social problems in the Kurdish heartland and the center of the PKK rebellion.
But many Turks still remain fascinated with the dream of "getting back" the Ottoman provinces of Kurdish-majority Mosul and Kirkuk in Iraq. They were originally included within the sacred borders of the republic proclaimed in the National Pact of 1919 by Ataturk and his comrades, who had started organizing resistance to fight for Turkey's independence from the occupying World War I victors.
So it has always remained a mission and objective to be reclaimed some time. The oil-rich part of Mosul region was occupied by the British forces illegally after the armistice and then annexed to Iraq, then under British mandate, in 1925, much to Turkish chagrin. Iraq was created by joining Ottoman Baghdad and Basra vilayats (provinces). Turks also base their claims on behalf of less than half a million Turkmen who lived in Kirkuk with the Kurds before Arabization changed the ethnic balance of the region.
With its attacks on Tal Afar, the US is stirring a very deep well of discontent.
K Gajendra Singh, Indian ambassador (retired), served as ambassador to Turkey from August 1992 to April 1996. Prior to that, he served terms as ambassador to Jordan, Romania and Senegal. He is currently chairman of the Foundation for Indo-Turkic Studies. Emai: Gajendrak@hotmail.com

(Copyright 2004 Asia Times Online Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)


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Once a Palace, Now Saddam Hussein's Prison
By JOHN F. BURNS
BAGHDAD, Iraq, Sept. 18 - Nine months after American troops pulled him disheveled and disoriented from an underground bunker near his hometown, Tikrit, Saddam Hussein is living in an air-conditioned 10-by-13 foot cell on the grounds of one of his former palaces outside Baghdad, tending plants, proclaiming himself Iraq's lawful ruler, and reading the Koran and books about past Arab glory.
American and Iraqi officials who have visited the former Iraqi leader say he wears plastic sandals and an Arab dishdasha robe, eats American soldiers' ready-to-eat meals for breakfast, and is permitted three hours' daily exercise in a courtyard outside his cell. He has been flown by Black Hawk helicopter to an American military hospital in Baghdad, where doctors ran tests for an enlarged prostate, which they believe could be an early pointer to cancer.
He has undergone hours of interrogation by investigators preparing evidence for his trial on charges of genocide and crimes against humanity.
But he has refused to acknowledge any wrongdoing, or to show remorse for the hundreds of thousands of people killed during his 24-year dictatorship, officials say. He has insisted that his position as Iraq's president gave him legal authority for all he did and that his victims were "traitors." At every encounter, the officials say, he insists that he is still the constitutionally elected president.
More than 80 other "high value detainees" at the same prison - including more than 40 who were on the Pentagon's "pack of cards" of Iraq's most-wanted fugitives - are kept away from Mr. Hussein, said Bakhtiar Amin, the Iraqi human rights minister. Mr. Hussein has been in solitary confinement since his capture on Dec. 13, officials said, because of a fear that he would try to rig evidence or intimidate old associates in the prison.
But the core of the group, 11 men who appeared with him in court on July 1, are allowed to exercise together, and to play chess, poker, backgammon and dominos. Offsetting those privileges, they have faced indignities Mr. Hussein has been spared, including, at the outset, digging their own latrines. But the strict protocol favored by authoritarian regimes still rules. "They call each other by their old titles, Mr. Minister of this, Mr. Minister of that," Mr. Amin said. "It is as if nothing has changed."
When Mr. Hussein appeared in court to be advised of his legal rights and of the charges under investigation, officials said it could be two years or more before he was brought to trial. None of the other former officials who appeared with him were likely to come to trial for as much as a year, they said, because of the tons of documents to be processed, as well as the need to interview the thousands of Iraqis who have come forward as potential witnesses.
But the interim government of Prime Minister Ayad Allawi has decided to fast-forward the legal processes. It has begun a shake-up of the staff at the special tribunal set up last year to hear the cases and hopes to begin the first high-profile trial, probably against Ali Hassan al-Majid, a cousin of Mr. Hussein's known as Chemical Ali, by November. Mr. Hussein's trial will follow, perhaps next year if the prosecutors are ready, Iraqi and American officials say.
In an interview at his heavily guarded residence in Baghdad on Thursday, Dr. Allawi said the government had "received the resignation" of Salem Chalabi, the American-educated lawyer who has been the court's chief administrator. He is a nephew of Ahmad Chalabi, the exile leader who was favored by the Pentagon before the March 2003 invasion, but who has recently been shunned by the American hierarchy here. Ahmad Chalabi has set himself up as a rival to Dr. Allawi among Iraq's majority Shiites, and his nephew, who has been implicated by the Allawi government in a murder case unrelated to the work of the tribunal, has been out of Iraq for most of the past two months.
Small Pleasures
In prison, Mr. Hussein has asked for some vestiges of the pleasures he enjoyed when he moved between dozens of palaces. "This was a man whose regime used a shredder to turn human bodies into ground beef," said Mr. Amin, the 46-year-old rights minister, who spent years abroad as an exile chronicling the abuses of Mr. Hussein's government and petitioning foreign governments and rights organizations to shun the Iraqi government.
"And now he sits there in his cell and asks for muffins and cookies and cigars," he said.
Mr. Hussein and his top lieutenants are being held at Camp Cropper, a heavily fortified compound that crouches behind high walls topped with rolls of razor wire, beneath sandbagged watchtowers manned by soldiers with machine guns. The camp lies within a vast American headquarters complex known as Camp Victory, that includes a network of palaces, as well as lakes that Mr. Hussein filled with fish. Planes using Baghdad International Airport pass low over the prison, 10 miles from the center of Baghdad.
For the trials, courtrooms are being readied in one of the vast, neo-imperialist buildings inside the former Republican Palace compound in central Baghdad that make up the Green Zone, the headquarters for the Allawi government and 2,500 American military and civilian officials. The five-judge panels that will preside at the juryless trials will have the power to impose death sentences on Mr. Hussein and his associates some of whom wept when they were told at the July hearing that they faced possible execution. For Mr. Hussein and his victims, a trial in the new court building, which The New York Times was asked not to identify for security reasons, will have a special irony. Mr. Hussein, who favored an architectural style emphasizing huge sandstone columns and portals, will face a reckoning in one of the buildings he erected to glorify his rule. In the dock, he will be a short walk away from the Republican Palace beside the Tigris River, once his main seat of power.
The Allawi government believes that the Iraqis, subjected to decades of terror, will begin to recover only when they see the men responsible brought to account. "Without justice, I don't see any possibility of healing the wounds in this society," Mr. Amin, the human rights minister, said. "These people turned Iraq into a 'massgrave-istan' by the scale of their crimes."
"They made an industry of murder," he said.
Establishing Legitimacy
There are political pressures, too. Dr. Allawi will be a candidate in elections set for January, a crucial step toward the goal of a constitutionally established, popularly elected government by 2006. With the mounting insurgency, he needs to bolster his waning popularity among Iraqis who increasingly blame him for the chaos. By putting top figures from the former government on trial, aides believe, he can remind Iraqis of the trauma that ended with their overthrow.
In the interview, Dr. Allawi said political calculations and a desire for revenge - he was nearly killed by assassins Mr. Hussein sent to his exile home in London, who attacked him with an ax while he slept, leaving him hospitalized for a year - played no part in his decision to accelerate the trials. Rather, he said, what he sought was a catharsis. "We need to bury the past," he said.
Dr. Allawi was a rising student leader in the governing Baath Party in the 1960's when he first met Mr. Hussein. He recalled him as a "thug who enjoyed hurting others," and as a man whose rule had been "like a horror movie." Now, he said, Mr. Hussein was paying the price. "My guess is that Saddam is dying every day," he said. "He is in prison, he is alone, he has lost everything, he has no power, nothing; and to him, that is worse than death."
Western legal experts familiar with the tribunal's work say they doubt the tribunal can meet Dr. Allawi's timetable for a November start to the trials. In many cases, the preparation of evidence is far from complete, and so far, the tribunal has found no Iraqi lawyers to defend Mr. Hussein and his associates.
In July, several defendants, including Mr. Majid, said they wanted lawyers from elsewhere in the Arab world, but none have come forward. "The high-value criminals have been informed about this, that no Iraqi lawyers are willing to take their cases, and that the foreign lawyers who said that they would didn't come forward, either," Mr. Amin said.
In his cell, Mr. Hussein has a fold-up bed, a small desk and a plastic chair, as well as a supply of bottled water and ice, a prayer mat and a choice of more than 170 books from a library supplied by the International Committee of the Red Cross. He sleeps a lot, officials said, and reads Arabic-language books with a pair of thick-rimmed spectacles, including tomes of ancient poetry and tales from nearly 1,000 years ago, when Baghdad was a famous center of learning and the capital of the Islamic world.
On visits to the Army's hospital in the Green Zone, Mr. Hussein has staked out his independence in other ways. In the hospital - named for Ibn Sina, a scientific pioneer of the early Islamic world - he has been treated by American military doctors and Iraqi physicians who were on his presidential medical team. Near wards filled with wounded American soldiers, he has undergone blood tests and scans that have confirmed that he has an enlarged prostate gland, medical officials said, as well as a hernia problem and trouble with one of his eyes.
But he has refused a surgical biopsy that might determine whether the prostate condition was cancerous, a decision officials involved said was common among American men of Mr. Hussein's age, 67, who often choose not to take the biopsy when they are told that the condition could take years to become life-threatening. "He has time," one official said. "There is no health issue that would prevent him standing trial."
Another official said Mr. Hussein had helped an American Navy surgeon take blood by gripping a tourniquet on his arm, and remarked, in English, "Perhaps I should have been a doctor, not a politician."
In the courtyard by his cell, Mr. Hussein has placed white-painted stones around the plants he tends, a fact that struck Mr. Amin, the human rights minister, as bizarre. "It's an irony of history," he said. "This is a man who committed some of the biggest acts of ecocide in history, when he drained the marshes in southern Iraq, used chemical weapons against 250 Kurdish villages, and shipped whole palm tree plantations to the charlatan leaders of the Arab world who were his shoeshine boys.
"And now he's a gardener."
Mr. Amin said Mr. Hussein had been denied newspapers, radio and television, and thus knew little about the political events in Iraq that have followed his capture. But he said the former ruler was upset when he was told that a prominent Sunni tribal leader, Sheik Ghazi al-Yawar, had been named by the United States to replace him as president.
"He was shaken and he was very upset," Mr. Amin said. "He couldn't accept that." He added: "He's a megalomaniac and a psychotic. He has never expressed any remorse for any of his victims. He is a man without a conscience. He is a beast."
Therapy Sessions Declined
An American general said Mr. Hussein had been offered sessions with American military psychologists, but had refused them, as had all his closest associates. Still, all 12 are watched by an American mental health team - especially under interrogation - for any sign they may be contemplating suicide. None has given cause for concern so far, the general said. Other officials gave a somewhat different picture, saying that some of the men had bouts of depression and complained bitterly about being denied family visits.
In the converted mosque annex at Camp Victory that was used as a courtroom in July, several of the former leaders seemed deeply shaken when told they faced a possible death penalty. Several blamed Mr. Hussein for the killings, and said they were only following orders. Since then, Iraqi officials said, several have offered to cooperate with their interrogators. One is Tariq Aziz, the cigar-smoking, whiskey-drinking former deputy prime minister, who was Mr. Hussein's diplomatic emissary; another is Barzan al-Tikriti, Mr. Hussein's half-brother.
Mr. Amin said he was hailed by Mr. Tikriti during a visit to Camp Cropper. "Somebody called out, 'Mr. Minister! Mr. Minister!' and said, 'Why are you treating me like Ali Hassan al-Majid? I am not one of them, everybody knows about the deep rivalry within my family' " - a reference, Mr. Amin said, to an incident in the early 1990's when Uday Hussein, the former ruler's oldest son, who was married to Mr. Tikriti's daughter, shot and seriously wounded his father-in-law in the legs during an argument over his treatment of his wife.
"He was depressed, it was a cry for help," Mr. Amin said. "But I told him, 'If you want to see the list of your crimes, I will show it to you. It is a long one.' "
Copyright 2004 The New York Times Company

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>> BANKING

September 18, 2004
Japan Shuts Unit of Citibank, Citing Violations
By TODD ZAUN
TOKYO, Sept. 17 - In one of the severest penalties ever imposed on a bank in Japan, regulators on Friday ordered Citigroup to close its Japanese private banking operations because of serious violations of the country's banking laws.
The Financial Services Agency ordered Citibank to shut the four branches in Japan where it offers private banking services to wealthy customers after the agency discovered a string of violations and improprieties over the last three years. The actions cited included failing to put in effect measures to prevent money laundering, overcharging customers for financial derivative products and making loans that helped clients carry out a variety of improper deals, regulators said.
"A number of acts injurious to public interests, serious violations of laws and regulations, and extremely inappropriate transactions were uncovered at the Private Bank Group, which led us to conclude that continued future operations are inappropriate," the Financial Services Agency wrote in its order.
Citibank in Japan apologized for the violations and vowed to improve its management and its internal controls.
"Citibank Japan sincerely apologizes for the problems identified in the F.S.A. orders and is earnestly addressing the issues raised and working to prevent their recurrence," the bank said in a statement. It added that it "is committed to doing everything necessary to restore the confidence of its customers."
The bank was ordered to come up with a plan to improve its business operations by Oct. 22. Citibank will have a year to close its private banking business. Though it cannot accept new customers after Sept. 29, the bank can continue to serve its current clients until Sept. 30, 2005. On that date, regulators will revoke Citibank's license to operate the four branches and they must be closed. Citibank could reapply for those licenses, but that would probably take years.
The bank said it did not know yet what would happen to the 400 employees working in the Japanese private banking division.
Citibank also has 25 retail branches in Japan, but those branches are not affected by Friday's order.
It was the second time this week that Citigroup has expressed contrition for breaches in its overseas operations.
On Tuesday, the company apologized for a huge bond trade in Europe that outraged competitors and led to an investigation by regulators in Britain; France and Germany are also looking into the trade. In early August, Citigroup traders sold 11 billion euros of European government debt ($13 billion) within minutes via an electronic trading system only to buy some of it back less than an hour later at lower prices.
The transactions were not illegal, but rivals said Citigroup violated an unwritten rule among big bond houses not to use their trading heft to manipulate prices.
Citibank's private banking business in Japan concentrates on customers with about $1 million to save or invest and emphasizes highly personalized service. But regulators said Citibank's private banking division often misled its well-heeled clients. Regulators said Citibank charged some customers above-market prices for publicly traded derivatives and failed to explain fully the risks involved in many of its financial products.
Regulators say Citibank also went beyond the scope of its banking license by brokering real estate and art deals for its rich clients - activities not allowed under Japanese banking laws.
Private banking employees were also reckless with client information, the bank regulators said. For example, some employees kept records of secret passwords for the most forgetful clients. Regulators discovered no cases of employees using the passwords to steal money.
Toshihide Endo, director of the Financial Services Agency's supervisory bureau, said that employees of the private banking group might have been tempted to take shortcuts when screening clients because "their salaries and performance evaluations were closely linked to sales targets.''
"That might be one of the main reasons this kind of misconduct happened at Citibank," he said.
In one case, the private banking unit in Japan accepted a customer who had been flagged repeatedly as suspicious by another unit of Citibank, the agency said in its statement. In another, the private banking group made a loan to a group of clients who used the money in a stock manipulation scheme. One of those same clients received a short-term loan from Citibank to inflate his account balance temporarily in a scheme to secure a government grant, Mr. Endo said.
Citibank said on Friday that six executives in Japan had left the company because of the problems made public Friday and that it had reprimanded other employees.
In July, Citigroup appointed its chief auditor, Douglas Peterson, to succeed Charles Whitehead as chief executive of the Japan operations.
A Citibank Japan spokesman, Toru Ichikawa, would not comment on whether Mr. Whitehead's departure was related to the troubles at the private banking division.

Citigroup does not provide figures on how much the private banking business in Japan contributes to its overall revenue or profit, but overseas private banking contributed only about 3 percent of Citigroup's net income in 2003.

Citibank's retail banking unit was also ordered to stop taking new foreign-currency deposits for one month, beginning Sept. 29, and to improve management controls. This suspension came for failing to detect a case in which a Citibank employee embezzled 1.8 billion yen (currently $16.4 million) from depositors over seven years, beginning in 1997.

The only other bank to face shutdown orders from Japanese regulators was Credit Suisse Financial Products, which had its banking license revoked in 1999 for blocking an investigation into whether it was engineering financial products specifically to help companies conceal losses on their accounting statements. The company was a unit of the Credit Suisse Group.



Copyright 2004 The New York Times Company

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>> TERROR


The Terrorism to Come
By Walter Laqueur
Walter Laqueur is co-chair of the International Research Council at the Center for Strategic and International Studies. He is the author of some of the basic texts on terrorism, most recently Voices of Terror (Reed Publishing, 2004). The present article is part of a larger project; the author wishes to thank the Earhart Foundation for its support.
Terrorism has become over a number of years the topic of ceaseless comment, debate, controversy, and search for roots and motives, and it figures on top of the national and international agenda. It is also at present one of the most highly emotionally charged topics of public debate, though quite why this should be the case is not entirely clear, because the overwhelming majority of participants do not sympathize with terrorism.
Confusion prevails, but confusion alone does not explain the emotions. There is always confusion when a new international phenomenon appears on the scene. This was the case, for instance, when communism first appeared (it was thought to be aiming largely at the nationalization of women and the burning of priests) and also fascism. But terrorism is not an unprecedented phenomenon; it is as old as the hills.
Thirty years ago, when the terrorism debate got underway, it was widely asserted that terrorism was basically a left-wing revolutionary movement caused by oppression and exploitation. Hence the conclusion: Find a political and social solution, remedy the underlying evil -- no oppression, no terrorism. The argument about the left-wing character of terrorism is no longer frequently heard, but the belief in a fatal link between poverty and violence has persisted. Whenever a major terrorist attack has taken place, one has heard appeals from high and low to provide credits and loans, to deal at long last with the deeper, true causes of terrorism, the roots rather than the symptoms and outward manifestations. And these roots are believed to be poverty, unemployment, backwardness, and inequality.
It is not too difficult to examine whether there is such a correlation between poverty and terrorism, and all the investigations have shown that this is not the case. The experts have maintained for a long time that poverty does not cause terrorism and prosperity does not cure it. In the world's 50 poorest countries there is little or no terrorism. A study by scholars Alan Krueger and Jitka Maleckova reached the conclusion that the terrorists are not poor people and do not come from poor societies. A Harvard economist has shown that economic growth is closely related to a society's ability to manage conflicts. More recently, a study of India has demonstrated that terrorism in the subcontinent has occurred in the most prosperous (Punjab) and most egalitarian (Kashmir, with a poverty ratio of 3.5 compared with the national average of 26 percent) regions and that, on the other hand, the poorest regions such as North Bihar have been free of terrorism. In the Arab countries (such as Egypt and Saudi Arabia, but also in North Africa), the terrorists originated not in the poorest and most neglected districts but hailed from places with concentrations of radical preachers. The backwardness, if any, was intellectual and cultural -- not economic and social.
These findings, however, have had little impact on public opinion (or on many politicians), and it is not difficult to see why. There is the general feeling that poverty and backwardness with all their concomitants are bad -- and that there is an urgent need to do much more about these problems. Hence the inclination to couple the two issues and the belief that if the (comparatively) wealthy Western nations would contribute much more to the development and welfare of the less fortunate, in cooperation with their governments, this would be in a long-term perspective the best, perhaps the only, effective way to solve the terrorist problem.
Reducing poverty in the Third World is a moral as well as a political and economic imperative, but to expect from it a decisive change in the foreseeable future as far as terrorism is concerned is unrealistic, to say the least. It ignores both the causes of backwardness and poverty and the motives for terrorism.
Poverty combined with youth unemployment does create a social and psychological climate in which Islamism and various populist and religious sects flourish, which in turn provide some of the footfolk for violent groups in internal conflicts. According to some projections, the number of young unemployed in the Arab world and North Africa could reach 50 million in two decades. Such a situation will not be conducive to political stability; it will increase the demographic pressure on Europe, since according to polls a majority of these young people want to emigrate. Politically, the populist discontent will be directed against the rulers -- Islamist in Iran, moderate in countries such as Egypt, Jordan, or Morocco. But how to help the failed economies of the Middle East and North Africa? What are the reasons for backwardness and stagnation in this part of the world? The countries that have made economic progress -- such as China and India, Korea and Taiwan, Malaysia and Turkey -- did so without massive foreign help.
All this points to a deep malaise and impending danger, but not to a direct link between the economic situation and international terrorism. There is of course a negative link: Terrorists will not hesitate to bring about a further aggravation in the situation; they certainly did great harm to the tourist industries in Bali and Egypt, in Palestine, Jordan, and Morocco. One of the main targets of terrorism in Iraq was the oil industry. It is no longer a secret that the carriers of international terrorism operating in Europe and America hail not from the poor, downtrodden, and unemployed but are usually of middle-class origin.
The local element
The link between terrorism and nationalist, ethnic, religious, and tribal conflict is far more tangible. These instances of terrorism are many and need not be enumerated in detail. Solving these conflicts would probably bring about a certain reduction in the incidence of terrorism. But the conflicts are many, and if some of them have been defused in recent years, other, new ones have emerged. Nor are the issues usually clear- cut or the bones of contention easy to define -- let alone to solve.
If the issue at stake is a certain territory or the demand for autonomy, a compromise through negotiations might be achieved. But it ought to be recalled that al Qaeda was founded and September 11 occurred not because of a territorial dispute or the feeling of national oppression but because of a religious commandment -- jihad and the establishment of shari'ah. Terrorist attacks in Central Asia and Morocco, in Saudi Arabia, Algeria, and partly in Iraq were directed against fellow Muslims, not against infidels. Appeasement may work in individual cases, but terrorist groups with global ambitions cannot be appeased by territorial concessions.
As in the war against poverty, the initiatives to solve local conflicts are overdue and should be welcomed. In an ideal world, the United Nations would be the main conflict resolver, but so far the record of the U.N. has been more than modest, and it is unlikely that this will change in the foreseeable future. Making peace is not an easy option; it involves funds and in some cases the stationing of armed forces. There is no great international crush to join the ranks of the volunteers: China, Russia, and Europe do not want to be bothered, and the United States is overstretched. In brief, as is so often the case, a fresh impetus is likely to occur only if the situation gets considerably worse and if the interests of some of the powers in restoring order happen to coincide.
Lastly, there should be no illusions with regard to the wider effect of a peaceful solution of one conflict or another. To give but one obvious example: Peace (or at least the absence of war) between Israel and the Palestinians would be a blessing for those concerned. It may be necessary to impose a solution since the chances of making any progress in this direction are nil but for some outside intervention. However, the assumption that a solution of a local conflict (even one of great symbolic importance) would have a dramatic effect in other parts of the world is unfounded. Osama bin Laden did not go to war because of Gaza and Nablus; he did not send his warriors to fight in Palestine. Even the disappearance of the "Zionist entity" would not have a significant impact on his supporters, except perhaps to provide encouragement for further action.
Such a warning against illusions is called for because there is a great deal of wishful thinking and na?vet? in this respect -- a belief in quick fixes and miracle solutions: If only there would be peace between Israelis and Palestinians, all the other conflicts would become manageable. But the problems are as much in Europe, Asia, and Africa as in the Middle East; there is a great deal of free-floating aggression which could (and probably would) easily turn in other directions once one conflict has been defused.
It seems likely, for instance, that in the years to come the struggle against the "near enemy" (the governments of the Arab and some non-Arab Muslim countries) will again feature prominently. There has been for some time a truce on the part of al Qaeda and related groups, partly for strategic reasons (to concentrate on the fight against America and the West) and partly because attacks against fellow Muslims, even if they are considered apostates, are bound to be less popular than fighting the infidels. But this truce, as events in Saudi Arabia and elsewhere show, may be coming to an end.
Tackling these supposed sources of terrorism, even for the wrong reasons, will do no harm and may bring some good. But it does not bring us any nearer to an understanding of the real sources of terrorism, a field that has become something akin to a circus ground for riding hobbyhorses and peddling preconceived notions.
How to explain the fact that in an inordinate number of instances where there has been a great deal of explosive material, there has been no terrorism? The gypsies of Europe certainly had many grievances and the Dalets (untouchables) of India and other Asian countries even more. But there has been no terrorism on their part -- just as the Chechens have been up in arms but not the Tartars of Russia, the Basque but not the Catalans of Spain. The list could easily be lengthened.
Accident may play a role (the absence or presence of a militant leadership), but there could also be a cultural-psychological predisposition. How to explain that out of 100 militants believing with equal intensity in the justice of their cause, only a very few will actually engage in terrorist actions? And out of this small minority even fewer will be willing to sacrifice their lives as suicide bombers? Imponderable factors might be involved: indoctrination but also psychological motives. Neither economic nor political analysis will be of much help in gaining an understanding, and it may not be sheer accident that there has been great reluctance to explore this political-intellectual minefield.
The focus on Islamist terrorism
To make predictions about the future course of terrorism is even more risky than political predictions in general. We are dealing here not with mass movements but small -- sometimes very small -- groups of people, and there is no known way at present to account for the movement of small particles either in the physical world or in human societies.
It is certain that terrorism will continue to operate. At the present time almost all attention is focused on Islamist terrorism, but it is useful to remember from time to time that this was not always the case -- even less than 30 years ago -- and that there are a great many conflicts, perceived oppressions, and other causes calling for radical action in the world which may come to the fore in the years to come. These need not even be major conflicts in an age in which small groups will have access to weapons of mass destruction.
At present, Islamist terrorism all but monopolizes our attention, and it certainly has not yet run its course. But it is unlikely that its present fanaticism will last forever; religious-nationalist fervor does not constantly burn with the same intensity. There is a phenomenon known in Egypt as "Salafi burnout," the mellowing of radical young people, the weakening of the original fanatical impetus. Like all other movements in history, messianic groups are subject to routinization, to the circulation of generations, to changing political circumstances, and to sudden or gradual changes in the intensity of religious belief. This could happen as a result of either victories or defeats. One day, it might be possible to appease militant Islamism -- though hardly in a period of burning aggression when confidence and faith in global victory have not yet been broken.
More likely the terrorist impetus will decline as a result of setbacks. Fanaticism, as history shows, is not easy to transfer from one generation to the next; attacks will continue, and some will be crowned with success (perhaps spectacular success), but many will not. When Alfred Nobel invented dynamite, many terrorists thought that this was the answer to their prayers, but theirs was a false hope. The trust put today in that new invincible weapon, namely suicide terrorism, may in the end be equally misplaced. Even the use of weapons of mass destruction might not be the terrorist panacea some believe it will be. Perhaps their effect will be less deadly than anticipated; perhaps it will be so destructive as to be considered counterproductive. Statistics show that in the terrorist attacks over the past decade, considerably more Muslims were killed than infidels. Since terrorists do not operate in a vacuum, this is bound to lead to dissent among their followers and even among the fanatical preachers.
There are likely to be splits among the terrorist groups even though their structure is not highly centralized. In brief, there is a probability that a united terrorist front will not last. It is unlikely that Osama and his close followers will be challenged on theological grounds, but there has been criticism for tactical reasons: Assuming that America and the West in general are in a state of decline, why did he not have more patience? Why did he have to launch a big attack while the infidels were still in a position to retaliate massively?
Some leading students of Islam have argued for a long time that radical Islamism passed its peak years ago and that its downfall and disappearance are only a question of time, perhaps not much time. It is true that societies that were exposed to the rule of fundamentalist fanatics (such as Iran) or to radical Islamist attack (such as Algeria) have been immunized to a certain extent. However, in a country of 60 million, some fanatics can always be found; as these lines are written, volunteers for suicide missions are being enlisted in Teheran and other cities of Iran. In any case, many countries have not yet undergone such first-hand experience; for them the rule of the shari'ah and the restoration of the caliphate are still brilliant dreams. By and large, therefore, the predictions about the impending demise of Islamism have been premature, while no doubt correct in the long run. Nor do we know what will follow. An interesting study on what happens "when prophecy fails" (by Leon Festinger) was published not long after World War ii. We now need a similar study on the likely circumstances and consequences of the failure of fanaticism. The history of religions (and political religions) offers some clues, as does the history of terrorism.
These, then, are the likely perspectives for the more distant future. But in a shorter-term perspective the danger remains acute and may, in fact, grow. Where and when are terrorist attacks most likely to occur? They will not necessarily be directed against the greatest and most dangerous enemy as perceived by the terrorist gurus. Much depends on where terrorists are strong and believe the enemy to be weak. That terrorist attacks are likely to continue in the Middle East goes without saying; other main danger zones are Central Asia and, above all, Pakistan.
The founders of Pakistan were secular politicians. The religious establishment and in particular the extremists among the Indian Muslims had opposed the emergence of the state. But once Pakistan came into being, they began to try with considerable success to dominate it. Their alternative educational system, the many thousand madrassas, became the breeding ground for jihad fighters. Ayub Khan, the first military ruler, tried to break their stranglehold but failed. Subsequent rulers, military and civilian, have not even tried. It is more than doubtful whether Pervez Musharraf will have any success in limiting their power. The tens of thousands of graduates they annually produce formed the backbone of the Taliban. Their leaders will find employment for them at home and in Central Asia, even if there is a de-escalation in tensions with India over Kashmir. Their most radical leaders aim at the destruction of India. Given Pakistan's internal weakness this may appear more than a little fanciful, but their destructive power is still considerable, and they can count on certain sympathies in the army and the intelligence service. A failed Pakistan with nuclear weapons at its disposal would be a major nightmare. Still, Pakistani terrorism -- like Palestinian and Middle Eastern in general -- remains territorial, likely to be limited to the subcontinent and Central Asia.
Battlefield Europe
Europe is probably the most vulnerable battlefield. To carry out operations in Europe and America, talents are needed that are not normally found among those who have no direct personal experience of life in the West. The Pakistani diaspora has not been very active in the terrorist field, except for a few militants in the United Kingdom.
Western Europe has become over a number of years the main base of terrorist support groups. This process has been facilitated by the growth of Muslim communities, the growing tensions with the native population, and the relative freedom with which radicals could organize in certain mosques and cultural organizations. Indoctrination was provided by militants who came to these countries as religious dignitaries. This freedom of action was considerably greater than that enjoyed in the Arab and Muslim world; not a few terrorists convicted of capital crimes in countries such as Egypt, Jordan, Morocco, and Algeria were given political asylum in Europe. True, there were some arrests and closer controls after September 11, but given the legal and political restrictions under which the European security services were laboring, effective counteraction was still exceedingly difficult.
West European governments have been frequently criticized for not having done enough to integrate Muslim newcomers into their societies, but cultural and social integration was certainly not what the newcomers wanted. They wanted to preserve their religious and ethnic identity and their way of life, and they resented intervention by secular authorities. In its great majority, the first generation of immigrants wanted to live in peace and quiet and to make a living for their families. But today they no longer have much control over their offspring.
This is a common phenomenon all over the world: the radicalization of the second generation of immigrants. This generation has been superficially acculturated (speaking fluently the language of the host country) yet at the same time feels resentment and hostility more acutely. It is not necessarily the power of the fundamentalist message (the young are not the most pious believers when it comes to carrying out all the religious commandments) which inspires many of the younger radical activists or sympathizers. It is the feeling of deep resentment because, unlike immigrants from other parts of the world, they could not successfully compete in the educational field, nor quite often make it at the work place. Feelings of being excluded, sexual repression (a taboo subject in this context), and other factors led to free-floating aggression and crime directed against the authorities and their neighbors.
As a result, non-Muslims began to feel threatened in streets they could once walk without fear. They came to regard the new immigrants as antisocial elements who wanted to change the traditional character of their homeland and their way of life, and consequently tensions continued to increase. Pressure on European governments is growing from all sides, right and left, to stop immigration and to restore law and order.
This, in briefest outline, is the milieu in which Islamist terrorism and terrorist support groups in Western Europe developed. There is little reason to assume that this trend will fundamentally change in the near future. On the contrary, the more the young generation of immigrants asserts itself, the more violence occurs in the streets, and the more terrorist attacks take place, the greater the anti-Muslim resentment on the part of the rest of the population. The rapid demographic growth of the Muslim communities further strengthens the impression among the old residents that they are swamped and deprived of their rights in their own homeland, not even entitled to speak the truth about the prevailing situation (such as, for instance, to reveal the statistics of prison inmates with Muslim backgrounds). Hence the violent reaction in even the most liberal European countries such as the Netherlands, Belgium, and Denmark. The fear of the veil turns into the fear that in the foreseeable future they too, having become a minority, will be compelled to conform to the commandments of another religion and culture.
True, the number of extremists is still very small. Among British Muslims, for instance, only 13 percent have expressed sympathy and support for terrorist attacks. But this still amounts to several hundred thousands, far more than needed for staging a terrorist campaign. The figure is suspect in any case because not all of those sharing radical views will openly express them to strangers, for reasons that hardly need be elaborated. Lastly, such a minority will not feel isolated in their own community as long as the majority remains silent -- which has been the case in France and most other European countries.
The prospects for terrorism based on a substantial Islamist periphery could hardly appear to be more promising, but there are certain circumstances that make the picture appear somewhat less threatening. The tensions are not equally strong in all countries. They are less palpably felt in Germany and Britain than in France and the Netherlands. Muslims in Germany are predominantly of Turkish origin and have (always with some exceptions) shown less inclination to take violent action than communities mainly composed of Arab and North African immigrants.
If acculturation and integration has been a failure in the short run, prospects are less hopeless in a longer perspective. The temptations of Western civilization are corrosive; young Muslims cannot be kept in a hermetically sealed ghetto (even though a strong attempt is made). They are disgusted and repelled by alcohol, loose morals, general decadence, and all the other wickedness of the society facing them, but they are at the same time fascinated and attracted by them. This is bound to affect their activist fervor, and they will be exposed not only to the negative aspects of the world surrounding them but also its values. Other religions had to face these temptations over the ages and by and large have been fighting a losing battle.
It is often forgotten that only a relatively short period passed from the primitive beginnings of Islam in the Arabian desert to the splendor and luxury (and learning and poetry) of Harun al Rashid's Baghdad -- from the austerity of the Koran to the not-so-austere Arabian Nights. The pulse of contemporary history is beating much faster, but is it beating fast enough? For it is a race against time. The advent of megaterrorism and the access to weapons of mass destruction is dangerous enough, but coupled with fanaticism it generates scenarios too unpleasant even to contemplate.
Enduring asymmetry
There can be no final victory in the fight against terrorism, for terrorism (rather than full-scale war) is the contemporary manifestation of conflict, and conflict will not disappear from earth as far as one can look ahead and human nature has not undergone a basic change. But it will be in our power to make life for terrorists and potential terrorists much more difficult.
Who ought to conduct the struggle against terrorism? Obviously, the military should play only a limited role in this context, and not only because it has not been trained for this purpose. The military may have to be called in for restoring order in countries that have failed to function and have become terrorist havens. It may have to intervene to prevent or stop massacres. It may be needed to deliver blows against terrorist concentrations. But these are not the most typical or frequent terrorist situations.
The key role in asymmetric warfare (a redundant new term for something that has been known for many centuries) should be played by intelligence and security services that may need a military arm.
As far as terrorism and also guerrilla warfare are concerned, there can be no general, overall doctrine in the way that Clausewitz or Jomini and others developed a regular warfare philosophy. An airplane or a battleship do not change their character wherever they operate, but the character of terrorism and guerrilla warfare depends largely on the motivations of those engaging in it and the conditions under which it takes place. Over the past centuries rules and laws of war have developed, and even earlier on there were certain rules that were by and large adhered to.
But terrorists cannot possibly accept these rules. It would be suicidal from their point of view if, to give but one example, they were to wear uniforms or other distinguishing marks. The essence of their operations rests on hiding their identities. On the other hand, they and their well-wishers insist that when captured, they should enjoy all the rights and benefits accorded to belligerents, that they be humanely treated, even paid some money and released after the end of hostilities. When regular soldiers do not stick to the rules of warfare, killing or maiming prisoners, carrying out massacres, taking hostages or committing crimes against the civilian population, they will be treated as war criminals.
If terrorists behaved according to these norms they would have little if any chance of success; the essence of terrorist operations now is indiscriminate attacks against civilians. But governments defending themselves against terrorism are widely expected not to behave in a similar way but to adhere to international law as it developed in conditions quite different from those prevailing today.
Terrorism does not accept laws and rules, whereas governments are bound by them; this, in briefest outline, is asymmetric warfare. If governments were to behave in a similar way, not feeling bound by existing rules and laws such as those against the killing of prisoners, this would be bitterly denounced. When the late Syrian President Hafez Assad faced an insurgency (and an attempted assassination) on the part of the Muslim Brotherhood in the city of Hama in 1980, his soldiers massacred some 20,000 inhabitants. This put an end to all ideas of terrorism and guerrilla warfare.
Such behavior on the part of democratic governments would be denounced as barbaric, a relapse into the practices of long-gone pre-civilized days. But if governments accept the principle of asymmetric warfare they will be severely, possibly fatally, handicapped. They cannot accept that terrorists are protected by the Geneva Conventions, which would mean, among other things, that they should be paid a salary while in captivity. Should they be regarded like the pirates of a bygone age as hostes generis humani, enemies of humankind, and be treated according to the principle of a un corsaire, un corsaire et demi -- "to catch a thief, it takes a thief," to quote one of Karl Marx's favorite sayings?
The problem will not arise if the terrorist group is small and not very dangerous. In this case normal legal procedures will be sufficient to deal with the problem (but even this is not quite certain once weapons of mass destruction become more readily accessible). Nor will the issue of shedding legal restraint arise if the issues at stake are of marginal importance, if in other words no core interests of the governments involved are concerned. If, on the other hand, the very survival of a society is at stake, it is most unlikely that governments will be impeded in their defense by laws and norms belonging to a bygone (and more humane) age.
It is often argued that such action is counterproductive because terrorism cannot be defeated by weapons alone, but is a struggle for the hearts and minds of people, a confrontation of ideas (or ideologies). If it were only that easy. It is not the terrorist ideas which cause the damage, but their weapons. Each case is different, but many terrorist groups do not have any specific idea or ideology, but a fervent belief, be it of a religious character or of a political religion. They fight for demands, territorial or otherwise, that seem to them self-evident, and they want to defeat their enemies. They are not open to dialogue or rational debate. When Mussolini was asked about his program by the socialists during the early days of fascism, he said that his program was to smash the skulls of the socialists.
Experience teaches that a little force is indeed counterproductive except in instances where small groups are involved. The use of massive, overwhelming force, on the other hand, is usually effective. But the use of massive force is almost always unpopular at home and abroad, and it will be applied only if core interests of the state are involved. To give but one example: The Russian government could deport the Chechens (or a significant portion), thus solving the problem according to the Stalinist pattern. If the Chechens were to threaten Moscow or St. Petersburg or the functioning of the Russian state or its fuel supply, there is but little doubt that such measures would be taken by the Russian or indeed any other government. But as long as the threat is only a marginal and peripheral one, the price to be paid for the application of massive force will be considered too high.
Two lessons follow: First, governments should launch an anti-terrorist campaign only if they are able and willing to apply massive force if need be. Second, terrorists have to ask themselves whether it is in their own best interest to cross the line between nuisance operations and attacks that threaten the vital interests of their enemies and will inevitably lead to massive counterblows.
Terrorists want total war -- not in the sense that they will (or could) mobilize unlimited resources; in this respect their possibilities are limited. But they want their attacks to be unfettered by laws, norms, regulations, and conventions. In the terrorist conception of warfare there is no room for the Red Cross.
Love or respect?
The why-do-they-hate-us question is raised in this context, along with the question of what could be done about it -- that is, the use of soft power in combating terrorism. Disturbing figures have been published about the low (and decreasing) popularity of America in foreign parts. Yet it is too often forgotten that international relations is not a popularity contest and that big and powerful countries have always been feared, resented, and envied; in short, they have not been loved. This has been the case since the days of the Assyrians and the Roman Empire. Neither the Ottoman nor the Spanish Empire, the Chinese, the Russian, nor the Japanese was ever popular. British sports were emulated in the colonies and French culture impressed the local elites in North Africa and Indochina, but this did not lead to political support, let alone identification with the rulers. Had there been public opinion polls in the days of Alexander the Great (let alone Ghengis Khan), the results, one suspects, would have been quite negative.
Big powers have been respected and feared but not loved for good reasons -- even if benevolent, tactful, and on their best behavior, they were threatening simply because of their very existence. Smaller nations could not feel comfortable, especially if they were located close to them. This was the case even in times when there was more than one big power (which allowed for the possibility of playing one against the other). It is all the more so at a time when only one superpower is left and the perceived threat looms even larger.
There is no known way for a big power to reduce this feeling on the part of other, smaller countries -- short of committing suicide or, at the very least, by somehow becoming weaker and less threatening. A moderate and intelligent policy on the part of the great power, concessions, and good deeds may mitigate somewhat the perceived threat, but it cannot remove it, because potentially the big power remains dangerous. It could always change its policy and become nasty, arrogant, and aggressive. These are the unfortunate facts of international life.
Soft power is important but has its limitations. Joseph S. Nye has described it as based on culture and political ideas, as influenced by the seductiveness of democracy, human rights, and individual opportunity. This is a powerful argument, and it is true that Washington has seldom used all its opportunities, the public diplomacy budget being about one-quarter of one percentage point of the defense budget. But the question is always to be asked: Who is to be influenced by our values and ideas? They could be quite effective in Europe, less so in a country like Russia, and not at all among the radical Islamists who abhor democracy (for all sovereignty rests with Allah rather than the people), who believe that human rights and tolerance are imperialist inventions, and who want to have nothing to do with deeper Western values which are not those of the Koran as they interpret it.
The work of the American radio stations during the Cold War ought to be recalled. They operated against much resistance at home but certainly had an impact on public opinion in Eastern Europe; according to evidence later received, even the Beatles had an influence on the younger generation in the Soviet Union. But, at present, radio and television has to be beamed to an audience 70 percent of which firmly believes that the operations of September 11 were staged by the Mossad. Such an audience will not be impressed by exposure to Western pop culture or a truthful, matter-of-fact coverage of the news. These societies may be vulnerable to covert manipulation of the kind conducted by the British government during World War ii: black (or at least gray) propaganda, rumors, half-truths, and outright lies. Societies steeped in belief in conspiracy theories will give credence to even the wildest rumors. But it is easy to imagine how an attempt to generate such propaganda would be received at home: It would be utterly rejected. Democratic countries are not able to engage in such practices except in a case of a major emergency, which at the present time has not yet arisen.
Big powers will never be loved, but in the terrorist context it is essential that they should be respected. As bin Laden's declarations prior to September 11 show, it was lack of respect for America that made him launch his attacks; he felt certain that the risk he was running was small, for the United States was a paper tiger, lacking both the will and the capability to strike back. After all, the Americans ran from Beirut in the 1980s and from Mogadishu in 1993 after only a few attacks, and there was every reason to believe that they would do so again.
Response in proportion to threat
Life could be made more difficult for terrorists by imposing more controls and restrictions wherever useful. But neither the rules of national nor those of international law are adequate to deal with terrorism. Many terrorists or suspected terrorists have been detained in America and in Europe, but only a handful have been put on trial and convicted, because inadmissible evidence was submitted or the authorities were reluctant to reveal the sources of their information -- and thus lose those sources. As a result, many who were almost certainly involved in terrorist operations were never arrested, while others were acquitted or released from detention.
As for those who are still detained, there have been loud protests against a violation of elementary human rights. Activists have argued that the real danger is not terrorism (the extent and the consequences of which have been greatly exaggerated) but the war against terrorism. Is it not true that American society could survive a disaster on the scale of September 11 even if it occurred once a year? Should free societies so easily give up their freedoms, which have been fought for and achieved over many centuries?
Some have foretold the coming of fascism in America (and to a lesser extent in Europe); others have predicted an authoritarian regime gradually introduced by governments cleverly exploiting the present situation for their own anti-democratic purposes. And it is quite likely indeed that among those detained there have been and are innocent people and that some of the controls introduced have interfered with human rights. However, there is much reason to think that to combat terrorism effectively, considerably more stringent measures will be needed than those presently in force.
But these measures can be adopted only if there is overwhelming public support, and it would be unwise even to try to push them through until the learning process about the danger of terrorism in an age of weapons of mass destruction has made further progress. Time will tell. If devastating attacks do not occur, stringent anti-terrorist measures will not be necessary. But if they do happen, the demand for effective countermeasures will be overwhelming. One could perhaps argue that further limitations of freedom are bound to be ineffective because terrorist groups are likely to be small or very small in the future and therefore likely to slip through safety nets. This is indeed a danger -- but the advice to abstain from safety measures is a counsel of despair unlikely to be accepted.
There are political reasons to use these restrictions with caution, because Muslim groups are bound to be under special scrutiny and every precaution should be taken not to antagonize moderate elements in this community. Muslim organizations in Britain have complained that a young Pakistani or Arab is 10 times more likely to be stopped and interrogated by the police than other youths. The same is true for France and other countries. But the police, after all, have some reasons to be particularly interested in these young people rather than those from other groups. It will not be easy to find a just and easy way out of the dilemma, and those who have to deal with it are not to be envied.
It could well be that, as far as the recent past is concerned, the danger of terrorism has been overstated. In the two world wars, more people were sometimes killed and more material damage caused in a few hours than through all the terrorist attacks in a recent year. True, our societies have since become more vulnerable and also far more sensitive regarding the loss of life, but the real issue at stake is not the attacks of the past few years but the coming dangers. Megaterrorism has not yet arrived; even 9-11 was a stage in between old-fashioned terrorism and the shape of things to come: the use of weapons of mass destruction.
The idea that such weapons should be used goes back at least 150 years. It was first enunciated by Karl Heinzen, a German radical -- later a resident of Louisville, Kentucky and Boston, Massachusetts -- soon after some Irish militants considered the use of poison gas in the British Parliament. But these were fantasies by a few eccentrics, too farfetched even for the science fiction writers of the day.
Today these have become real possibilities. For the first time in human history very small groups have, or will have, the potential to cause immense destruction. In a situation such as the present one there is always the danger of focusing entirely on the situation at hand -- radical nationalist or religious groups with whom political solutions may be found. There is a danger of concentrating on Islamism and forgetting that the problem is a far wider one. Political solutions to deal with their grievances may sometimes be possible, but frequently they are not. Today's terrorists, in their majority, are not diplomats eager to negotiate or to find compromises. And even if some of them would be satisfied with less than total victory and the annihilation of the enemy, there will always be a more radical group eager to continue the struggle.
This was always the case, but in the past it mattered little: If some Irish radicals wanted to continue the struggle against the British in 1921-22, even after the mainstream rebels had signed a treaty with the British government which gave them a free state, they were quickly defeated. Today even small groups matter a great deal precisely because of their enormous potential destructive power, their relative independence, the fact that they are not rational actors, and the possibility that their motivation may not be political in the first place.
Perhaps the scenario is too pessimistic; perhaps the weapons of mass destruction, for whatever reason, will never be used. But it would be the first time in human history that such arms, once invented, had not been used. In the last resort, the problem is, of course, the human condition.
In 1932, when Einstein attempted to induce Freud to support pacifism, Freud replied that there was no likelihood of suppressing humanity's aggressive tendencies. If there was any reason for hope, it was that people would turn away on rational grounds -- that war had become too destructive, that there was no scope anymore in war for acts of heroism according to the old ideals.
Freud was partly correct: War (at least between great powers) has become far less likely for rational reasons. But his argument does not apply to terrorism motivated mainly not by political or economic interests, based not just on aggression but also on fanaticism with an admixture of madness.
Terrorism, therefore, will continue -- not perhaps with the same intensity at all times, and some parts of the globe may be spared altogether. But there can be no victory, only an uphill struggle, at times successful, at others not.
Feedback? Email polrev@hoover.stanford.edu. Or send us a Letter to the Editor.
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>> RUSSIA

Russia's New--and
Frightening--"Ism"
John B. Dunlop
In recent years, a new ideology has gained adherents among Russian elites: "Eurasianism," the belief that Russia must reassert its dominance over the Eurasian landmass. An unsettling assessment of the work of Aleksandr Dugin, the leading Eurasianist theorist.
John B. Dunlop is a senior fellow at the Hoover Institution.
Few books published in Russia during the post-communist period have exerted such an influence on Russian military, police, and foreign policy elites as Aleksandr Dugin's 1997 neo-fascist treatise Osnovy geopolitiki: Geopoliticheskoe budushchee Rossii (Foundations of Geopolitics: The Geo-political Future of Russia). The impact of this intended "Eurasianist" textbook on key Russian elites testifies to the worrisome rise of fascist ideas and sentiments during the late Yeltsin and the Putin periods.
Five years before President George W. Bush announced his "axis of evil," Dugin had introduced three key neo-Eurasian axes: Moscow-Berlin, Moscow-Tokyo, and Moscow-Tehran. The basic principle underlying these three axes was said to be "a common enemy," by which he meant the United States.



The Moscow-Berlin Axis
According to Dugin, as a result of a grand alliance to be concluded between Russia and Germany, the two countries will divide up into spheres of influence all the territories lying between them, with no "sanitary cordon." Dugin proposes that Germany be offered political dominance over most Protestant and Catholic states located within Central and Eastern Europe and that Kaliningrad be returned to Germany as part of this bargain. The "unstable" state of Finland, which "historically enters into the geopolitical space of Russia," is seen as an exception. Poland, Latvia, and Lithuania are also to be allocated to the Russian-Eurasian sphere of dominance, as is "the north of the Balkan peninsula from Serbia to Bulgaria," which is described as part of the "Russian South."
At one point in his textbook, Dugin confides that all arrangements with "the Eurasian bloc of the continental West," headed by Germany, will be merely temporary and provisional in nature. "The maximum task [for the future]," he underscores, "is the `Finlandization' of all of Europe."
As for the former Soviet Union republics situated within Europe, all--with the single exception of Estonia--are to be absorbed by Eurasia-Russia. Belarus, Dugin pronounces, "should be seen as part of Russia." In a similar vein, Moldova is assigned to what Dugin terms the "Russian South." On Ukraine, Dugin stipulates that, with the exception of its three westernmost regions--Volhynia, Galicia, and Transcarpathia--Ukraine, like Belarus, constitutes an integral part of Russia-Eurasia.



The Moscow-Tokyo Axis
The cornerstone of Dugin's approach to the Far East lies in the creation of a Moscow-Tokyo axis. In Russia's relations with Japan, he emphasizes that the principle of a common enemy "will prove decisive." Dugin recommends that the Kuriles be restored to Japan, just as Kaliningrad should be returned to Germany.
Dugin sees the People's Republic of China, like the United States, as an enormous danger to Russia-Eurasia. "China," he warns, "is the most dangerous geopolitical neighbor of Russia to the south" and verges on being an American factotum. At several points in his book, Dugin expresses a fear that China might "undertake a desperate thrust into the north--into Kazakhstan and Eastern Siberia."
Because of the threat that it represents to Russia's perceived vital geopolitical interests, China must, to the maximum degree possible, Dugin asserts, be dismantled. "Tibet-Xinjiang-Mongolia-Manchuria," he writes, "taken together comprise a security belt of Russia." "Without Xinjiang and Tibet," he concludes, "the geopolitical breakthrough of China into Kazakhstan and Siberia becomes impossible." As "geopolitical compensation" for the loss of its northern regions, China should be offered development "in a southern direction--Indochina (except Vietnam), the Philippines, Indonesia, Australia."



The Moscow-Tehran Axis
The most ambitious and complex part of Dugin's program concerns the South, where the focal point is a Moscow-Tehran axis. "The idea of a continental Russia-Islamic alliance," he writes, "lies at the foundation of anti-Atlanticist strategy. . . . This alliance is based on the traditional character of Russian and Islamic civilizations." As the result of a broad Grand Alliance to be concluded with Iran, Russia-Eurasia will eventually enjoy realizing a centuries-old Russian dream of reaching the "warm seas" of the Indian Ocean. Russia is to enjoy "geopolitical access--in the first place, naval bases--on the Iranian shores."
As the result of such an alliance, Dugin argues, Russia-Eurasia should be prepared to divide up the imperial spoils with "the Islamic Empire [of Iran] to the south." Which part of the South should come under Russia? "What is the Russian South?" Dugin asks at one point in his book. He answers that it includes "the Caucasus [all of it]," "the eastern and northern shores of the Caspian," "Central Asia [that is, all of the former Soviet republics]," plus Mongolia. Even these regions, he adds, should be seen "as zones of further geopolitical expansion to the south and not as `eternal borders of Russia.'" Turkey is seen as being almost as dangerous to Russia-Eurasia as are the United States and China. Turkish minorities must be provoked into rebellion, and there is a need, he stresses, to create "geopolitical shocks" within Turkey.
Dugin's Foundations of Geopolitics represents a harsh and cynical repudiation of the architecture of international relations that was laboriously erected following the Second World War and the emergence of nuclear weapons. Dugin and his "system" want to return us, it seems, to the combustible interwar period and something akin to the rise of fascism in Europe, with the lurid imperial fantasies of Il Duce, the f?hrer, and other demagogues. Could, one wonders, a reversion to a destructive past be the "dividend" that Russia and the West are to receive for having with enormous effort put an end to the Cold War?
A considerably longer version of this essay appeared in Harvard Ukrainian Studies 25, nos. 1/2 (2001).

Available from the Hoover Press is The Economics of Forced Labor: The Soviet Gulag, edited by Paul R. Gregory and Valery Lazarev. To order, call 800.935.2882.
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>> FOREIGN AID

How Foreign Aid Can Help the Poor--and Why It Doesn't
by Bruce Bueno de Mesquita
July 28, 2004
People who think foreign aid ought to be used to help end poverty complain that it has too many strings attached. That strings are attached is true; the problem is not too many strings but rather that the wrong strings are attached to end poverty.
Most aid reflects a deal between leaders in rich, democratic countries and leaders in poor, despotic countries. Autocrats need money to keep core supporters--the military, key bureaucrats, close family members--in line, and democrats need policy concessions that help with reelection. Since few voters care much about foreign policy, these are marginal effects and so small amounts are spent on aid.
A natural opportunity exists for deals between democrats and autocrats. The latter don't need successful policies to stay in office, so they can agree to policies their citizens don't like in exchange for money to sustain them in power. Just consider Hosni Mubarak's agreement for Egypt to live in peace with Israel. In fact, autocrats like Mubarak must maintain their citizenry's dislike for policy concessions they grant. If the policy could be enforced without aid, there would be no reason to continue to pay. Democratic leaders cannot easily buy incumbency; they must deliver policies their constituents like. Thus, the main string attached to foreign aid deals is money for policy. That is a winning situation for leaders in donor and recipient countries and is pretty good for donor citizens too. But it is bad for ordinary citizens in the recipient country. Their welfare is sold for aid.
No wonder aid does little to raise incomes, improve health or education, or do the myriad other things well-intentioned people would like aid to do. How might these problems be corrected? There are four steps to changing aid into a means to help the poor:
Encourage individuals and groups to give aid through NGOs or directly to needy recipients, rather than by and to government. Shifting aid outside government reduces the danger of government deals that do not alleviate poverty. (Currently the United States contributes about $56 per American citizen in global aid. Total assistance could easily be maintained if wealthier families contributed twice that, deducting it from their taxes as charitable giving.)
Require aid recipients to open their books to independent, external audit.
Broadcast audit results in easily digested form.
When aid must be given to governments, give to those that have at least two organized, freely operating political parties or other political groups that articulate views different from those of their government, and be sure that these groups have an unencumbered right to compete against the incumbent leader for office.
Until poverty-alleviating aid is moved out of the government's domain and into the hands of caring citizens, and until government aid is constrained to go as directly as possible to those who need the money the most, aid will continue to serve as a means to achieve policy goals (a good thing), to prolong despotism (a bad thing), and to lead recipients to engage in policies that are against the interests of their own citizens (a very bad thing).

Posted by maximpost at 11:24 PM EDT
Permalink
Monday, 13 September 2004


>> "Dam experts say that the region of the explosion is a mountainous area with little rainfall, which is an inadequate choice for a dam site."




Is North Korea Hiding Something about Explosion?
Was the massive explosion that took place in Ryanggang for building a hydropower station, as North Korea has explained?
Despite the explanation of North Korean Foreign Minister Paek Nam-sun, some analysts have said questions still remain. True, since South Korea took a satellite picture about 10 hours after the explosion, the smoke cloud grew larger than the one immediately after the explosion and that might lead to unnecessary misunderstandings.
Many people, however, have interpreted that the North might have been hiding something. The South Korean government did not seem to believe the North's explanation perfectly. A South Korean high ranking official said, "I wonder if it was really necessary to detonate such a huge quantity of explosives in building a small dam?"
North Korean defectors think the North has not given a correct explanation to conceal its military factories. It is highly likely that the North is worried about the possibility that a crowd of military plants near the explosion site would be uncovered if it acknowledged that the explosion was large-scale. A North Korean defector said, "Many large scale accidents have taken place in North Korea. April's explosion in Ryongchon, however, was the only case the North publicly admitted." Korea University professor Yoo Ho-yeol said, "South Korea needs to focus on the possibility that North Korean Foreign Minister Paek Nam-sun diplomatically made the explanation without knowing core information."
Meanwhile, many people pointed out that the North's explanation is credible since it came from its Foreign Minister. They have said that unlike the explosion of Ryongchon, the North has not rapidly revealed the scale of damage and casualties because the explosion had not been an accident. Government officials have appeared to step back from their presumption by saying Monday that the large cloud formed on Sept. 9 was unclear. Intelligence authorities have not ruled out analysis that the explosion was a large-scale one. Some interpret that the government has said that the explosion is not serious just because it wasn't a nuclear test.
As of now, it is uncertain whether the North gave a correct explanation or it is hiding something. It seems that disputes over the credibility of the North's explanation will continue until North Korea reveals evidence backing its construction of a hydropower plant or South Korean and U.S intelligence authorities complete their analysis of the information.
(englishnews@chosun.com )




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North Korea Will Let British Diplomat Visit Blast Site
2004-09-13
SEOUL, Sept. 13, 2004--North Korea has agreed to allow a British diplomat visit the site of a massive explosion that sparked fears the reclusive country had conducted a nuclear test. Pyongyang says the explosion was aimed at demolishing a mountain to make way for a large hydroelectric dam.
Britain's Foreign Office minister Bill Rammell requested access to the site during a visit to North Korea, the BBC reported Monday. In an unusual concession, North Korea said the British ambassador David Slinn could visit the site to see for himself as early as Tuesday.
Rammell was in Pyongyang for talks with the North Korean Foreign Minister Paek Nam Sun.
"Having asked the vice foreign minister this morning for our ambassador and other ambassadors to be allowed to visit the scene of the explosion I am very pleased the North Koreans have agreed to the request," Rammell was quoted as saying. "But I pressed the Foreign Minister very strongly and said look, you know, if we want to be properly reassured then you should allow international diplomats to actually go to the area and verify the situation on the ground."
Paek said he would consider the request, Rammell said. "If this is genuinely a deliberate detonation as part of a legitimate construction project then the North Koreans have nothing to fear and nothing to hide and should welcome the international community actually verifying the situation for themselves," Rammell said.
U.S. downplays blast
Washington has downplayed the Sept. 9 explosion Yongjo-ri in Yanggang Province. It occurred on North Korea's National Day, which stoked fears that the explosion might have been a nuclear test.
Speaking to ABC television on Sunday, U.S. Secretary of State Colin Powell cited "no indication that was a nuclear event of any kind. Exactly what it was, we're not sure."
The South Korean news agency Yonhap reported that a mammoth explosion in North Korea on Thursday had produced a mushroom cloud more than three kms (two miles) across.
Yonhap said the blast was stronger than an April explosion that killed 160 people and injured some 1,300 at a North Korean railway station when a train carrying oil and chemicals apparently hit power lines.
South Korean and U.S. officials said Sunday that they were trying to ascertain the cause of the huge cloud.
North Korea lashes back
North Korea meanwhile lashed out Monday at South Korea for what it described as spreading lies about the blast, saying Seoul fostered rumors of a nuclear weapons test to divert attention from its own atomic revelations.
"There has been no such accident as explosion in the DPRK recently," said the official Korean Central News Agency (KCNA), accusing Seoul of a "preposterous smear campaign."
"Probably, plot-breeders might tell such a sheer lie, taken aback by blastings at construction sites of hydro-power stations in the north of Korea," it said.
South Korea was recently forced to admit that its scientists carried out experiments to produce small amounts of enriched uranium and plutonium, both key ingredients in nuclear bombs.
The South Korean experiments in 1982 and 2000, which Seoul says weren't a bid to develop weapons, are likely to further complicate six-nation talks aimed at dismantling North Korea's nuclear development.


Copyright ? 2001-2004 Radio Free Asia. All Rights Reserved.

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C?c nước trong khu vực lo ngại trước một vụ nổ lớn ở Bắc H?n
2004-09-13
Bấm v?o đ?y để nghe bản tin l?c 6:30 ng?y 13-9 (giờ VN)
Rightclick to save as this audio
Một vụ nổ lớn xảy ra ở Bắc H?n, gần bi?n giới Trung Quốc, g?y một đ?m m?y h?nh nấm c? chu vi tới 4 kil?m?t. H?ng tin Yonhap của Nam H?n h?m nay loan tin vụ nổ n?y xảy ra hồi 11 giờ s?ng thứ Năm tuần trước tại tỉnh Yanggang của Bắc Triều Ti?n.
Nguồn tin cho biết những nước quanh v?ng như Nga, Trung Quốc, Nhật Bản v? Nam H?n, đều ghi nhận được chấn động do vụ nổ g?y ra, nhưng kh?ng nước n?o ch?nh thức loan b?o.
Ngoại trưởng Hoa Kỳ Colin Powell trong cuộc phỏng vấn truyền h?nh h?m Chủ nhật n?i rằng Washington kh?ng biết nguy?n nh?n n?o g?y ra vụ nổ lớn như vậy, nhưng ?ng kh?ng tin rằng đ? l? một vụ nổ nguy?n tử.
Trung t?m ph?ng xạ của Nga ở Vladivostok cho biết mức độ ph?ng xạ quanh v?ng vẫn b?nh thường, d? vụ nổ xảy ra gần căn cứ qu?n sự b? mật trong huyện Kimhyungjik của Bắc H?n.
Phần lớn c?c nước đều cho l? vụ nổ l? một trong những h?nh thức qu?n sự m? B?nh Nhưỡng thường l?m để vực dậy niềm tự h?o d?n tộc ở một quốc gia qu? ngh?o đ?i. H?m thứ Năm tuần qua cũng l? ng?y Bắc H?n ch?o đ?n Quốc Kh?nh lần thứ 56.
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North Explosion Blasting Operation for Hydroelectric Station: BBC
North Korea's Foreign Minister Paek Nam-sun said Monday that the explosion in North Korea's Ryanggang Province was actually a blasting operation for constructing a hydroelectric power station, according to U.K. broadcaster BBC.
The BBC reported that Paek had said the explosion was a planned demolition of a mountainous area linked to plans to build a hydroelectric power station, and that his comments came as a response to a request for information from U.K. Foreign Office minister Bill Rammell, who is currently visiting North Korea.
BBC also reported that Rammell asked Paek to allow a visit the blast site, and Paek said he would consider the request. Bill Rammell is visiting Pyongyang to discuss the nuclear issue and human rights.
A South Korean government official said, "There are over 6,000 hydroelectric power station under construction in the country, so the North's claim may be true," but added, "I am suspicious, however, as to why the North had to blow up such a large amount of ammunition." Dam experts say that the region of the explosion is a mountainous area with little rainfall, which is an inadequate choice for a dam site.
US ambassador Christopher Hill said in his meeting with Prime Minister Lee Hai-chan that the explosion was probably a "simple accident," not related to the nuclear activities, according to Lee Gang-jin, a senior press secretary to the prime minister. Unification minister Chung Dong-young also said in an Assembly session that the matter was not one over which one should show much concern.
(englishnews@chosun.com )

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Gov't Confirms 'Non-Nuclear' N. Korean Explosion
It was reported that there was a massive explosion Thursday around the town of Yongjo-ri, Kim Hyong-jik County, Ryanggang Province. U.S. Department of State, sources familiar with North Korea and the Korean government all confirmed the explosion.
A high-ranking government official said Sunday, "It is true that a large mushroom cloud about 3.5 to 4 km in diameter was observed by a satellite at around 11:00 a.m. Thursday. It was not a nuclear test, but the explosion seemed to be three times bigger than the one that took place during the Ryongchon Station accident," and added, "Both U.S. and Korean intelligence authorities are investigating what caused the explosion."
Chong Wa Dae Spokesman Kim Jong-min said, "We noticed the explosion right after it took place and reported it to the president in writing during a National Security Council meeting. But we cannot decide the nature of the accident yet."
The accident took place in a mountainous region 1,500 meter above sea level around Yongjo-ri, where it is known that there were many munitions factories nearby. In particular, the exact spot of explosion is only 10km away southwest from the Yongjo-ri base for Rodong 1 and 2 missiles and some 30km away from the Sino-Korean border.
There is much talk about the cause of the explosion. The government official said, "If a nuclear test causes an explosion, we can detect it by reading satellite data. Thus, the recent explosion in North Korea was not caused by a nuclear test." The intelligence authorities assume that an ammunition depot with over 1,000 tons of dynamite or an ammunition car may have exploded, or there may have been a chain explosion of chemical material or a big fire. Some Chinese sources argue that a massive explosion took pace in a munitions factory. Hong Sun-jik, director at the Hyundai Economic Institute said, "Other than the assumption that it may be a simple accident that took place due to old facilities, we cannot exclude the possibility that the explosion may have taken place due to the lack of control of the Kim Jong-il regime, or it may have been connected to a secret feud over the successor of Kim Jong-il following the rumor of death of Kim's wife, Koh Young-hee."
Also, some strongly argue that it is not a simple accident because it took place on Sept.9, the North's foundation day, which is considered a very important national holiday. Others argue that with Korea's nuclear experiments in the past at issue in the international community, it could be a false explosion by North Korea to intensify the Korea's nuclear issue. In other words, the North intentionally caused the explosion to deliver a message to the international community.
The government official said, "We will be able to know the exact cause only after North Korea makes an official statement or intelligence authorities announces the results of their analysis."
(Choi Byung-mook, bmchoi@chosun.com )

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Massive Explosion Takes Place Near Sino-Korean Border
A Chinese source familiar with North Korea revealed Sunday that a major explosion took place Thursday in Kim Hyong-jik County, Ryanggang Province.
The source said, "I know there was an extremely large explosion in Kim Hyong-jik County, which is near the Sino-Korean border, on Sept. 9, North Korea's foundation day."
He added, "I heard talk that the explosion was even bigger than the one that took place during the Ryongchon Station accident... Evidence of the explosion was detected by satellite, and I understand the U.S. and other surrounding nations are paying attention to the incident."
In relation to this, another source connected to North Korea said, "I heard rumors of a large explosion taking place in North Korea's Ryanggang Province, which is close to the border with China."
An official from a certain surrounding nation who resides in Beijing said, "There is a rumor that a large explosion took place in Ryanggang Province, and interested nations are working to uncover the exact scale and cause of the explosion."
Kim Hyong-jik Country, where the explosion is known to have taken place. is across the Yalu River from Jilin Province, China, and South Korean intelligence authorities understand that a base for Taepodong 1 and 2 missiles was located at the town of Yongjo-ri, in a mountainous region of the province.
(englishnews@chosun.com )

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World Media Focuses on N. Korean Explosion
The media of the entire world reported Sunday on the large explosion that took place in North Korea's Kim Hyong-jik County, Ryanggang Province on Thursday. In particular, some foreign press focused their attentions on whether North Korea had conducted a nuclear test to mark North Korea's Sept. 9 foundation day, relaying news reports that a mushroom cloud had been witnessed.
As soon as AP put out a lead story on the incident, it immediately put out a follow up piece. Reuters reported Sunday that a large explosion took place in a North Korean region along the Sino-Korean border Thursday, and that the explosion was larger than the one that occurred at Ryongchon Station in April. Ahead of this, Japan's Kyodo News sent off an urgent dispatch at 11:27 a.m., while other global media like France's AFP all wired stories concerning the explosion.
In particular, major international media focused attention on the fact that the explosion took place on Sept. 9, North Korea's foundation day, and that a mushroom cloud had been witnessed.
AP and CNN didn't directly suggest that that the explosion had anything to do with a nuclear test, but said some experts were guessing that there was a possibility that North Korea had conducted a test related to its nuclear program to mark Sept. 9.
Meanwhile, the Internet edition of the New York Times reported Sunday that U.S. President George Bush and his high-ranking advisors had recently received a reliable intelligence report on North Korean moves that contained the opinions of some experts that North Korea was preparing to test its first nuclear device, quoting high-ranking officials familiar with the report. The paper said, however, that there were split opinions among intelligence organizations as to how to evaluate the importance of the new North Korean moves.
Intelligence experts who were skeptical of intelligence concerning Iraq's weapons of mass destruction told the NYT that they did not think North Korean activity over the last three weeks were necessarily signs that they were going to conduct a nuclear test. One high-ranking scientist familiar with nuclear intelligence said the new evidence was not conclusive, but potentially worrisome. In interviews with the NYT on Friday and Saturday, high-ranking officials did not release any specific information concerning confirmed recent moves by the North Koreans, but the paper said it appeared that some of the intelligence had come from satellites.
One official said recent North Korean moves represented a chain of believable signs that suggested they might be related to a nuclear test, and said the possibility that a nuclear test might be conducted within the next four weeks had increased greatly. The NYT said the North Korean moves included the movement of objects in a number of regions suspected of being nuclear test cities, including sites designated last year by intelligence bodies as places nuclear tests could be conducted.
Some officials said, moreover, that in the event that North Korea conducts a nuclear test, it might do so with the intention of influencing the U.S. presidential election, said the NYT.
(englishnews@chosun.com )


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North Korea Must Reveal What Happened in Ryanggang
There were reports that a massive explosion took place at Kim Hyong-jik County, Ryanggang Province, North Korea on Thursday. At present, it seems that the explosion was not caused by a nuclear test, but there is a high possibility that it is somehow connected to military purposes since it took place in a mountainous region 1,500 meters above sea level around the Sino-Korean border where there are few civilians living and many war plants and missile bases nearby.
In addition, there is talk that the explosion was even bigger that the one that took place during the Ryongchon Station accident last April. Some even raised suspicion that it may have to do with a nuclear test following the report that a mushroom cloud over 3km in diameter was seen. Others said that it may have been the activity of anti-government forces within the North. The Japanese media has reported that it is likely connected to a nuclear test.
North Korea needs to explain what caused the explosion and what the current development is not to add fuel to the fire amid a series of reports of abnormal signs. Actually, there have been rumors in the U.S. that a shocking incident would occur in North Korea in October and a major explosion test would take place in a remote mountain village near the Gaema Plateau.
The U.S. New York Times also reported that North Korea's moves related to nuclear development have raised concern. North Korea should not try to simply dismiss those reports and assumptions in the international community because it would not help the country itself, which needs the international community's support, as well as peace on the Korean Peninsula.
Another worrying thing is whether the Korean government has been effectively gathering even a little information on the North's moves and cooperating with neighboring countries. The National Security Council standing meeting was held three days after the massive explosion in question and that was the time the defense minister reported the accident. Not only that, some reports say the government has not even secured a satellite picture yet. Watching all this, how can the public feel reassured?
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Huge Blast in North Korea Not a 'Nuclear Event,' Powell Says
By DAVID E. SANGER
and WILLIAM J. BROAD
WASHINGTON, Sept. 12 -- Secretary of State Colin L. Powell said today that a huge explosion that took place Thursday on North Korea's border with China was likely "not any kind of nuclear event," but he said Washington was "monitoring" the country closely to see if a sudden burst of activity indicated the country was attempting to test a nuclear weapon for the first time.
Mr. Powell's comments came as intelligence analysts and policymakers attempted to understand what happened on Thursday near a site where North Korea bases some of its long-range missiles. South Korean news reports said that an explosion that day, a national holiday in North Korea, created a mushroom-shaped cloud that was at least a mile across, and maybe larger. But there were no signs of radiation, according to American intelligence officials, and the leading theory now is an accident that may have involved liquid rocket fuel.
Nonetheless, the explosion sent a ripple though intelligence networks that are already on high alert for any sign of a nuclear test, one that President Bush's national security adviser, Condoleezza Rice, warned today on the CBS News program "Face the Nation" would be "a very bad mistake."
But in private, administration officials said there was little they could do other than let the North know that it is being watched, and ask the Chinese -- the North's main supplier of food and energy -- to put pressure on the country not to set off a nuclear explosion.
"It's no longer just North Korea versus the United States," Mr. Powell said on the ABC News program "This Week." "It's North Korea versus all of its neighbors, which have no interest in seeing North Korea with a nuclear weapon."
The location of the Thursday explosion made American officials suspect right away that it was an accident instead of a test: There is a widespread assumption that the North would not demonstrate whatever nuclear capacity it has near the Chinese border, and would not do so above ground. The areas under intense satellite surveillance now -- which American officials have asked to be described only in general terms -- are closer to the center of the country, and in some remote, unpopulated areas.
In recent days, the administration has received intelligence reports describing a confusing series of actions by North Korea that some experts believe could indicate the country is preparing to conduct its first test explosion of a nuclear weapon, according to senior officials with access to the intelligence.
While the indications were viewed as serious enough to warrant a warning to the White House, American intelligence agencies appear divided about the significance of the new North Korean actions, much as they were about the evidence concerning Iraq's alleged weapons stockpiles.
Some analysts in agencies that were the most cautious about the Iraq findings have cautioned that they do not believe the activity detected in North Korea in the past three weeks is necessarily the harbinger of a test. A senior scientist who assesses nuclear intelligence says the new evidence "is not conclusive," but is potentially worrisome.
In an interview today on "Fox News Sunday," Mr. Powell confirmed that the United States has been monitoring activities at a "potential nuclear test site."
"We can't tell whether it's normal maintenance activity or something more," Mr. Powell said. "So it's inconclusive at this moment, but we continue to monitor these things very carefully."
Ms. Rice said in an interview today on CNN's "Late Edition," "We'll continue to pursue with China and Russia and Japan and South Korea satisfactory ways to have the North Koreans abandon their nuclear weapons program."
Asked if there was a "military option" on the table if the North Koreans went ahead with a test, Ms. Rice said: "The president never takes any option off the table. But we believe that the way to resolve this is diplomatically."
If successful, a test would end a debate that stretches back more than a decade over whether North Korea has a rudimentary arsenal, as it has boasted in recent years. Some analysts also fear that a test could change the balance of power in Asia, perhaps leading to a new nuclear arms race there.
In interviews on Friday and Saturday, senior officials were reluctant to provide many details of the new activities they have detected, but some of the information appears to have come from satellite intelligence.
One official with access to the intelligence called it "a series of indicators of increased activity that we believe would be associated with a test," saying that the "likelihood" of a North Korean test had risen significantly in just the past four weeks. It was that changed assessment that led to the decision to give an update to President Bush, the officials said.
The activities included the movement of materials around several suspected test sites, including one near a location where intelligence agencies reported last year that conventional explosives were being tested that could compress a plutonium core and set off a nuclear blast. But officials have not seen the classic indicators of preparations at a test site, in which cables are laid to measure an explosion in a deep test pit.
"I'm not sure you would see that in a country that has tunnels everywhere," said one senior official who has reviewed the data. Officials said if North Korea proceeded with a test, it would probably be with a plutonium bomb, perhaps one fabricated from the 8,000 spent nuclear fuel rods that the North has boasted in the past few months have been reprocessed into bomb fuel.
A senior intelligence official noted Saturday that even if "they are doing something, it doesn't mean they will" conduct a test, noting that preparations that the North knew could be detected by the United States might be a scare tactic or negotiating tactic by the North Korean government.
Several officials speculated that the test, if it occurred, could be intended to influence the presidential election, though a senior military official said while "an election surprise" could be the motive, "I'm not sure what that would buy them."
While the intelligence community's experience in Iraq colors how it assesses threats in places like North Korea, the comparisons are inexact. Inspectors have seen and measured the raw material that the North could turn into bomb fuel; the only question is whether they have done so in the 20 months since arms inspectors were ousted. While Iraq denied it has weapons, the North boasts about them -- perhaps too loudly, suggesting they may have less than they say.
On the other hand, the division within the administration over how to deal with North Korea mirrors some of the old debate about Iraq. Hard-liners in the Pentagon and the vice president's office have largely opposed making concessions of any kind in negotiations, and Vice President Dick Cheney has warned that "time is not on our side" to deal with the question. The State Department has pressed the case for negotiation, and for offering the North a face-saving way out. While the State Department has won the argument in recent times, how to deal with the North is a constant battle inside the administration.
Some of the senior officials who discussed the emerging indicators were clearly trying to warn North Korea's leader, Kim Jong Il, that his actions were being closely watched. Asian officials noted that there has been speculation in South Korea and Japan for some time that Mr. Kim might try to stage an incident -- perhaps a missile test or the withdrawal of more raw nuclear fuel from a reactor -- in an effort to display defiance before the election. "A test would be a vivid demonstration of their view of President Bush," one senior Asian diplomat said.
The intelligence information was discussed in interviews with officials from five government agencies, ranging from those who believe a test may occur at any moment to those who are highly skeptical. They had differing access to the intelligence: some had reviewed the raw data and others had seen a classified intelligence report about the possibility of a test, perhaps within months, that has circulated in Washington in the past week. Most, but not all, were career officials.
If North Korea successfully tested a weapon, the reclusive country would become the eighth nation to have proven nuclear capability -- Israel is also assumed to have working weapons -- and it would represent the failure of 14 years of efforts to stop the North's nuclear program.
Government officials throughout Asia and members of Mr. Bush's national security team have also feared it could change the nuclear politics of Asia, fueling political pressure in South Korea and Japan to develop a nuclear deterrent independent of the United States.
Both countries have the technological skill and the raw material to produce a bomb, though both have insisted they would never do so. South Korea has admitted in the past few weeks that it conducted experiments that outside experts fear could produce bomb-grade fuel, first in the early 1980's and then in 2000.
Senior officials in South Korea and Japan did not appear to have been briefed about the new evidence, beyond what one called "a nonspecific warning of a growing problem" from American officials. But it is a measure of the extraordinary nervousness about the North's intentions that earlier this week, South Korean intelligence officials who saw evidence of an intense fire at a suspected nuclear location alerted their American counterparts that a small nuclear test might have already occurred. American officials reviewed seismic sensors and other data and concluded it was a false alarm, though the fire has yet to be explained.
A huge explosion rocked an area in North Korea near the border with China on Thursday and appeared to be much bigger than a blast at the Ryongchon train station that killed 170 people in April, the Reuters news agency said, citing a report by the Yonhap news agency of South Korea. The United States "is showing a big interest because the blast was seen from satellites," Yonhap quoted an unidentified official in Beijing as saying.
The cause of the blast has not been determined, but the Beijing official said Washington was not ruling out the possibility that it may be linked to a nuclear test. Yonhap reported that a mushroom cloud up to 2.5 miles in diameter was spotted after the blast in remote Yanggang province in the far northeast.
North Korea has declared several times in the past year that it might move to demonstrate its nuclear power. It is impossible to know how such a test might affect public perceptions of how Mr. Bush has handled potential threats to the United States. Senator John Kerry, the Democratic presidential nominee, has already accused President Bush of an "almost myopic" focus on Iraq that has distracted the United States while North Korea, by some intelligence estimates, has increased its arsenal from what the C.I.A. suspects was one or two weapons to six or eight now.
Mr. Bush, while declaring he would not "tolerate" a nuclear North Korea, has insisted that his approach of involving China, Russia, Japan and South Korea in a new round of talks with the North is the only reasonable way to force the country to disarm. He has refused to set the kind of deadline for disarmament that he set for Saddam Hussein.
When asked in an interview with The New York Times two weeks ago to define what he meant by "tolerate," he said: "I don't think you give timelines to dictators and tyrants. I think it's important for us to continue to lead coalitions that are firm and strong, in sending messages to both the North Koreans and the Iranians."
Eric Schmitt contributed reporting for this article.
Copyright 2004 The New York Times Company

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SEPT 13, 2004
High-stakes nuclear game in East Asia
Region may be closer to a nuclear arms race than previously thought
By Jonathan Eyal
LONDON - Revelations over the weekend about a massive and mysterious explosion on North Korea's border with China have intensified the feverish speculations about the country's nuclear programme.
While the chances still are that the explosion was of the conventional variety and not a nuclear test, the steadily rising tide of rumours and contradictory information represent a clear indication that the North Korean nuclear crisis is about to reach its most volatile stage.
Regardless of who wins in the United States presidential elections in November, Pyongyang will become one of the key and most urgent priorities for any US administration.
And Washington will have to deal on this matter not only with the unpredictable North Korean regime, but also with US ally South Korea.
As always, very little information is available about the latest North Korean blast, but what is known is hardly encouraging. It is clear that the explosion was huge, much bigger than the military train explosion in April, an accident in which apparently 170 North Koreans were killed.
US intelligence reports, leaked to the American media, talk of a mushroom cloud of up to 4km in diameter, consistent - at least in physical appearance - to what will happen in a rudimentary nuclear test.
Other circumstantial evidence appears even more ominous.
The blast took place in Kimhyungjik county in Ryanggang province in the north-east, near North Korea's border with China, an area with a sparse civilian population, but a high concentration of military installations.
Furthermore, US satellites have detected over the past few weeks an unusual amount of military movements in the region, consistent with preparations for some kind of a weapons test.
And, to round off the picture, the North Koreans appear to have been very calm about the event, claiming that it was a 'routine event', rather than an accident.
For the moment, both the American and South Korean authorities claim the explosion was not nuclear-related.
But the difficulty is that both governments may have a very strong political interest in not appearing to be alarmed.
With an election in the offing, the last thing President George W. Bush needs now is a full-fledged North Korean nuclear crisis, inviting accusations from Senator John Kerry, his Democratic opponent, that America's entire anti-proliferation policy has failed.
The South Koreans, mired in their own difficulties, are hardly likely to welcome such a development as well.
Precisely because of this, the timing may have been perfect for North Korea to undertake now the nuclear test it has been planning for years.
Nevertheless, and despite these conspiracy theories, the chances still are that the latest blast was not nuclear.
First, it is difficult to hide the seismic aftermath of such a nuclear blast, which would have been picked up by many other neighbouring countries, apart from the US and South Korea.
Second, even if one assumes that the US administration may have a political interest in hiding the real significance of what has happened in North Korea, the deliberate falsification of evidence would be a high-risk strategy for Mr Bush.
If information of a deliberate cover-up subsequently leaked out - as it always does in the US - the impact on his re-election campaign would be devastating.
The assumption, therefore, must be that Washington is correct, and that the latest North Korean explosion was of the conventional variety.
Yet this is hardly reassuring, for the latest murky episode is merely another twist in what is turning out to be a much more complex saga.
North Korea is known to be developing a family of long-range missiles called the Taepodong precisely in the area where the current blast has been recorded.
Taepodong 1, the first variety of this system, was test-fired over Japan in 1998, and the family of missiles was designed to carry nuclear charges.
According to South Korean intelligence reports, the engine test for the Taepodong 2 improved variety was carried out in May this year.
A full missile test is the logical next step, and it is this which we may have witnessed now.
So, although the nuclear test itself may not have happened, North Korea's advance towards the acquisition of a fully functioning nuclear capability is continuing relentlessly.
And then there is South Korea itself.
The recent revelations that some of its scientists produced enriched uranium a few years ago using lasers have been dismissed by the the government as unimportant.
The quantity involved - 0.2g - was insignificant for any weapon capability, and Seoul has also claimed that the scientists worked without government knowledge.
Perhaps, but these claims are not very persuasive.
First, the quantity of enriched uranium is hardly the issue, since nobody is suggesting that South Korea is about to build a nuclear weapon.
But what matters is that the uranium produced is close to weapons grade, far more concentrated in the active uranium-235 isotope than would be required for the country's nuclear energy reactors.
And the subsequent revelations that South Korea had also conducted a plutonium-based nuclear experiment two decades ago merely strengthens the conclusion that the South, like its northern neighbour, had an active programme which at least could lead to a nuclear capability.
The suggestion that all this was done without the knowledge of the government in Seoul hardly requires serious examination.
The conclusions are truly earth-shattering.
For years, the US has worked under the assumption that the biggest challenge in the region came from North Korea; it now turns out that the problem runs much deeper, and may include both Koreas.
Further afield, Japan and Taiwan also have all the technology and know-how to produce nuclear weapons in a short period of time.
Although everyone denies it, all the region's states are now having another look at their military posture, and this includes their military capabilities.
And for a simple reason: In many respects, the question of North Korea was always just a sideshow to much deeper strategic changes taking place throughout the region.
According to opinion polls, a majority of South Korean citizens certainly fear the North Koreans' military capabilities, but regard nuclear weapons as their historic right, their ultimate guarantee against a future aggressive China and Japan.
Japan, too, regards North Korea as an immediate threat, but views China as the long-term challenge.
And Taiwan, forced by the US to abandon its nuclear research programme decades ago, still considers the weapon as its ultimate guarantee against forced unification with China.
The announced draw-down of US military bases from the region has merely intensified this military pirouette, which has until now been conducted very secretly.
One way or another, the task for a new US president after he steps into the White House's Oval Office next January will be huge.
The challenge is no longer merely one of persuading the North Korean regime to relinquish its nuclear aspirations, but also of reassuring America's allies in the region that they do not need to advance down the nuclear road either.
The task is still feasible. Yet, one false step in these diplomatic negotiations could plunge the region into a full-fledged nuclear arms race.
So, regardless of its nature, the latest mysterious blast in North Korea has lifted the dust over a whole raft of other secret activities in that corner of Asia.
The writer is director of studies at the Royal United Services Institute in London and a regular contributor to the Straits Times.


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Copyright @ 2004 Singapore Press Holdings. All rights reserved.


Playing the nuclear bully in Pyongyang
North Korea promises its people eternal prosperity under Kim Jong Ill, but nuclear-tipped blackmail is what Anne Penketh discovers in the most closed society in the world
13 September 2004
Two girls in pink roller-blade across a pristine square, the epitome of Asian cool. Across the vast empty expanse, neither a sweet wrapper nor a discarded piece of chewing gum is allowed to spoil the scene outside the People's Palace of Culture as the world's most reclusive communist state celebrates its 56th anniversary.
All day the country's propaganda machine churns out the familiar line: "As long as there is the wise leadership of Kim Jong Il, the Korean People's Army and the people will achieve eternal prosperity of the country."
Of the mushroom-shaped cloud that emerged over the north of the country last week, putting diplomats from East and West into a tizz, there is not a whisper.
Yesterday, standing on the platform at Yongwang metro station in Pyongyang, the visitor would be struck by the beauty of the twisted coloured glass lamps hanging from the ceiling, and by the friezes running down each side of the platform, depicting the left and right banks of a river. Yongwang (meaning Glory) is indeed a marvel to behold. But there is something more sinister that catches the eye at the bottom of the escalator that dives sharply into the bowels of the city: the two sets of giant reinforced doors. For the Soviet-era metro has the dual purpose of serving as a nuclear bunker.
North Korea has played the nuclear card for years to blackmail the international community into shoring up its communist regime. But when George Bush branded North Korea part of the "axis of evil" and warned in his state of the nation last year: "America and the rest of the world will not be blackmailed," the world moved a notch closer towards nuclear Armageddon.
News of the massive explosion suggested that Kim Jong Il, the country's mercurial dictator, or 'the experienced and tested leader' as the Korean Central News Agency describes him, may have played another card in his game of nuclear blackmail. The explosion in an area near missile bases in Ryanggang province in the remote north-east, near the border with China, was much stronger than a train explosion that killed at least 170 people in April.
If it turns out to be part of a nuclear experiment, and not an industrial accident, it could be the final proof that the regime was not boasting when it announced last year that it had developed an advanced nuclear weapons programme.
Last night the news of the explosion and mushroom cloud spread through the diplomatic community in Pyongyang, causing a frenzy of activity. So secretive is the regime, and so unpredictable its behaviour, that every one thought it quite plausible that the North Koreans had carried out their threat to test a nuclear weapon.
This is, after all, the country that waited 48 hours before informing the rest of the world of the train crash at Ryongchon in April that left 169 people dead and triggered rumours of an assassination attempt on Kim Jong Il. The regime waited another 21 hours before informing North Koreans themselves.
North Korea is the most closed society in the world, and probably the most inhumane. Its people are kept in a constant state of fear which is fed by the regular air raid warnings that could presage an attack by America.
George Bush was recently likened to Hitler by Kim Jong Il. The people have no internet connections, access to foreigners is strictly limited and tightly controlled, and the only information the North Koreans receive is through the official media. This is the policy of Juche in action, the self-sufficiency that has been the watchword of the country since its establishment at the end of the Korean war - which never produced a peace treaty between North and South Korea.
It is said that the indoctrination of the people is so successful that there is no need for the heavy-handed approach of a Soviet or East German style secret police. Random conversations in Pyongyang - in the presence of government minders - very quickly lead to city residents making a statement of loyalty to the government.
It is said that North Korean authorities place their 22.6 million citizens into three categories: core (or reliable), wavering, and hostile. The latter category seems to coincide with those who have been sent to prison camps, whose existence has been filmed by satellite photographs. But according to some sources, there may be up to 51 classifications, not just three.
Militaristic symbols are everywhere, along the huge grey avenues flanked by austere grey buildings. One roadside billboard shows three helmeted soldiers raising their fists towards a glorious future. Another exhorts: "Think and work and live according to the requirements of Sungun politics" (the policy that puts the military first).
While the military and political ?lite live a relatively cosseted life in the capital, the impoverishment of the people outside can only be glimpsed: on the road to the airport, one sees oxen pulling loaded carts, women bent double under loads of firewood and bicycles loaded up with sacks. Cars are a rarity on the broad avenues that sweep through the city.
But the modern world is now beating at the gate, and the number of North Koreans willing to risk their lives to escape is growing: 2,000 are expected to flee through China to South Korea by the end of this year, compared with 1,200 who escaped via that route last year. The days of the regime may well be numbered. But for the international community, the burning question is how to manage a "safe landing" for a nuclear-armed country whose collapse would be much more dangerous than that of East Germany 15 years ago.
At this time, the nuclear powers in the UN Security Council - Britain, France, Russia, China and the United States - are hoping to coax Pyongyang into a new round of six-party talks in order to end the latest standoff over North Korea's nuclear weapons programme. A new date for the talks - involving the two Koreas, Japan, China, Russia and the US - has been pencilled in for 22 September, but North Korea is keeping mum about whether it will attend.
Delegations from Australia, Britain and China have beaten a path to Pyongyang in the last few weeks to attempt to persuade the North Korean leadership that it is useless to hedge its bets on a change of American leadership, saying that American policy is unlikely to change whether George Bush is re-elected or whether it is John Kerry in the White House.
It is hoped that the North Koreans will accept the US offer on the table: to agree to dismantle all their supposed nuclear weapons, then during a three-month period, energy supplies and other aid would start coming into the country. In the same period, though, Pyongyang would have to declare all its nuclear programmes, submit to inspections, and disable all its nuclear weapons. Once those steps are complete, further support and aid would come through.
One big problem for the West's assessment is the lack of knowledge about what is happening inside the country. Even in Burma, human rights officials can meet dissidents, or visit prisons. But not in North Korea. Out of 26 counties in North Korea, 40 are closed to foreigners - including Kimhyongik county near the Chinese border, where yesterday's incident took place. The veil of secrecy has only been lifted by the accounts of North Korean defectors. But even though their reports have been cross-checked and compared to satellite photographs, an informed observer in Pyongyang this week said that "the point is that we don't know anything for sure".
Until now, Pyongyang has issued blanket denials about the existence of prison camps for political dissidents, which could contain up to 200,000 inmates. One defector, a former North Korean army intelligence officer, told the BBC last February that he had seen prisoners gassed to death. The North Koreans said the allegations were part of a US-inspired "lie".
Pyongyang only admitted to the bizarre practice of abducting the nationals of Japan and South Korea to use them to train spies as recently as this year, after denying it for decades. Five were returned to Japan for emotional reunions last March.
Meanwhile, Amnesty International reports that the surveillance and "checking" for illegal North Koreans in China has intensified since 2001. Tens of thousands have been forcibly repatriated by China since 2002.
North Korea also seems to be the only country that practices collective punishment - meting out punishment to successive generations after an offender has paid the penalty.
A senior North Korean official admitted for the first time yesterday to a visiting British delegation that "reeducation through labour is used" in North Korea. The official, Ri Jong Hyok, who is in charge of North Korean policy towards South Korea as president of the Institute for National Reunification, said he did not know how many camps there were, and did not go into details as to whether the camps were for criminals or political dissidents.
In addition to the nuclear issue, North Korea has been accused of using its citizens as pawns in attempting to blackmail the West to provide aid in order to shore up the regime, after its disastrous famine of 1995 and 1996. "The international aid arrived in the nick of time to stop North Korea from collapsing. The government had allowed several million ordinary people to starve to death, but by around 1998 it could no longer feed the army or the party members of the DPRK - everyone faced terminal starvation," says Jasper Becker, who is shortly to publish a book on North Korea. "The UN and South Korean aid went to the ?lite and ensured they stayed loyal. Kim Jong Il was faced with being being able to impose martial law in key areas of the country and terrorise it into submission. The international community and the South Korean 'sunshine policy' elevated his status by making him central to the flow of aid and he could resume arms purchases and the nuclear weapons programme."
Richard Ragan, the country director for the World Food programme, denies suggestions that the UN aid was diverted to the military and the ?lite. He notes that last year, the North Koreans harvested 4 million tonnes of cereals whereas 5 million are needed for survival. "The military will eat from that four million tonnes - that's guaranteed," he said.
He added that he was also sceptical about the reports of UN aid being diverted because of its nature - cereals (ie not rice) and milk products designed for children. "They're not going to eat that stuff," he said.
Britain is meanwhile concerned that North Korea announced that for 2005 it will not participate in the UN consolidated appeal for humanitarian aid. Government officials say they would prefer to deal with individual governments on their own terms. Bilateral aid is not monitored in the same way as the UN operation. Now the Pyongyang government runs the risk that international aid will dry up.
But the decision to stop accepting the UN co-ordinated humanitarian aid - now nine years after the famine - may have been motivated by a desire to "save face". Mr Ragan said that the continued humanitarian aid - as opposed to other assistance - "was undermining their policy of self-sufficiency".
He predicted that economic changes which have led to the introduction of timid market reforms in the food sector could produce "winners and losers" and a new need for food aid.
But the fact of the economic reforms, introduced in 2002, may be a sign that the regime has recognised that it must adapt or die.
One Western diplomat last night portrayed Kim Jong Il as a reformer who has allowed the personality cult to build up around his late father Kim Il Sung, while he takes a back seat.
Pyongyang is draped with huge portraits of Kim Il Sung seemingly on every building. His portrait graces every government office. A huge bronze-coloured statue of him on Mansudae Hill was visited yesterday in the driving rain by pilgrims who laid wreaths and bowed in homage before walking off. Kim Jong Il is present in the official portraits, but in a lesser role."It could be that Kim Jong Il is preparing the ground to say that his father's way didn't really work, and he can step in," the diplomat said.
But in the Looking Glass world of North Korea, the real intentions of the regime can only be guessed at.
12 September 2004 19:15
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Huge blast in North Korea fuels nuclear bomb fears
By Anne Penketh, Diplomatic Editor
13 September 2004
North Korea may have brazenly defied the rest of the world by carrying out tests linked to the production of a nuclear bomb last week during celebrations to mark the 56th anniversary of the state's foundation.
A huge explosion rocked a remote part of North Korea last week, it was reported in the South Korean capital, Seoul, yesterday. US and South Korean officials rushed to say that despite the appearance of a "peculiar cloud" over the area, it was unlikely to have been a nuclear weapons test.
The news came during a visit to the North Korean capital by Bill Rammell, a British Foreign Office minister, who learnt of the explosion, 250 miles north of Pyongyang, just after 1pm while at the British ambassador's residence.
He informed officials at the North Korean Foreign Ministry, who were apparently unaware of the reported explosion.
Mr Rammell, who hopes to receive details today from the North Korean Foreign Minister, Paek Nam Sun, said the incident highlighted "the difficulties that we have with them in their dealings with the outside world".
The first report, from the South Korean news agency Yonhap, said that "a mushroom cloud with a radius of 3.5 to 4km was spotted in Kimhyongjik county" on Thursday, the 56th anniversary of the establishment of North Korea.
The mountainous area is completely closed to foreigners. Diplomats said that the location of North Korea's nuclear test site is unknown.
Some Korea watchers had feared that North Korea might carry out such an act as the temperature rises again in its dispute with the Americans over Pyongyang's suspected nuclear weapons programme.
But as the hours wore on, other possible explanations surfaced for the cloud. It may have been caused by an exploding rocket, or by a massive forest fire. The Americans were quick to deny that any nuclear explosion had taken place.
One diplomatic source in Pyongyang noted that the report first surfaced in South Korea. "It may have been a fishing expedition by the South Korean press perhaps. It happens all the time."
Diplomats were also puzzled as to why North Korea would risk alienating China, almost its only remaining ally, by exploding a bomb on its border with all the risks to the Chinese population that it would entail.
It was also unclear why North Korea would have taken the risk of exploding a bomb in the atmosphere, with the possibility of long-term loss of life to its own citizens.
If it was a nuclear bomb test there is likely to be fallout in Washington, which failed to predict the 1998 tests by Pakistan which led to a series of tit-for-tat explosions by India and Pakistan and brought the two countries to the brink of war.

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UK minister tackles North Koreans on human rights abuse
By Anne Penketh in Pyongyang, North Korea
12 September 2004
Britain placed human rights at the heart of its relationship with North Korea last night as the Foreign Office minister Bill Rammell arrived in Pyong-yang to take the measure of the world's most reclusive Communist state.
Mr Rammell, making the first visit to North Korea by a British minister, made it clear from the outset of his first meeting, with the vice-foreign minister for Europe, Kung Sok Ung, that he would raise the "very serious human rights allegations'' during three days of talks.
The visit went ahead only after North Korea agreed to discuss human rights as well as the thorny nuclear issue that has bedevilled the country's relations with the rest of the world since it announced that it had a nuclear weapon in 2002.
Mr Rammell told the minister he welcomed the addition of human rights to the agenda. Mr Kung failed to respond directly at their foreign ministry meeting.
The British delegation last night raised specific human rights cases that will be discussed in more detail tomorrow. These include the fate of a former North Korean ambassador to Indonesia who was sent to labour camp, and that of two abducted South Korean pastors.
Mr Rammell and his team, which included the Foreign Office expert on human rights, Jon Benjamin, are calling for North Korea to admit a UN human rights investigator for a return trip by Mr Benjamin.
But a brief spat less than an hour later highlighted the extent of the hard-line government's paranoia, when official minders refused to allow a television camera into a new food market despite having given prior agreement.
After a short stand-off during which Mr Rammell cooled his heels outside the blue-roofed market - the produce ranged from dried squid to dog meat - his party and the camera were allowed inside.
Diplomats say that such well-stocked markets, which were introduced in the wake of monetary reform that pegged all foreign currency exchanges to the euro in 2002, are the sign of a timid liberalisation that could keep food shortages at bay.
Yet Pyongyang still looks like a city built for war, from its limitless airport runway to its deep underground Soviet-era metro and the wide avenues virtually devoid of traffic on a Saturday afternoon. About 30 military trucks were parked outside the foreign ministry yesterday.
Militaristic billboards are everywhere in the one-party state devoted to the cult of the late Great Leader Kim Il Sung, whose picture greets visitors from the airport terminal.
In central Pyongyang, dominated by austere grey buildings and monuments to his memory, soldiers raise their fists over the slogan "think and work and live according to the requirements of Sungun politics'', the policy that places the military at the vanguard of society.
Even though the party and military elite live in Pyongyang, their fear of the outside world is palpable. Talking to foreigners is actively discouraged unless the conversations are officially approved. When journalists entered a metro car at Buhung station, where patriotic music plays in the background, two people quietly slipped out of the car.
A student, who agreed to a short conversation in the presence of a government minder, was asked how much her salary would be when she found work in a hotel after completing her course. The salary is not important, she replied. "I try to repay the care of the government,'' she said.
A group of men was reading the sports news on a stand inside the metro. One of them, a surgeon named Jang Ji Min, described how he had watched the Olympic Games on television. What was his impression?
He chatted affably for a few minutes, saying he was naturally pleased at the victory of the North Korean medal for weightlifting, and was impressed by the Chinese divers.
He added: "By seeing the play of sportsmen on television I realised how they tried their best to glorify our country by having a great success at the Games.''
12 September 2004 19:21

?2004 Independent Digital (UK) Ltd. All rights reserved

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Korea
N Korea's military edge over S Korea
By David Scofield
Despite lacking the resources necessary to feed and care for its own people, North Korea has found the funds necessary to develop its conventional military capabilities beyond those of South Korea. That North Korea's leadership is willing to allow starvation and pestilence while it fuels the military is well known, but last week's report by the Korea Institute for Defense Analyses indicating an edge to DPRK forces caught many by surprise.
It is known that South Korea maintains 690,000 troops, backed by around 37,000 United States forces, while North Korea boasts a 1.1 million-strong military. The latest reckoning, however, says South Korea's air force was 103% of North Korea's, while its army and naval strengths were 80% and 90% respectively of those of the North, according to the state-run Korea Institute for Defense Analysis. That doesn't count North Korea's nuclear weapons program and it doesn't count Pyongyang's 100,000 special forces. While it is difficult to compare the two sides qualitatively, in terms of numbers, the North appears to have the edge.
Of course, there are methodological questions surrounding the report. Is it appropriate, for example, to compare generations-old technology in the North with the far newer equipment in use in the South? Comparing air force, army and naval vessels ton for ton, rather then focusing on the technology in use is not a precise measure of these nations' military projection capabilities. Indeed, some analysts quickly concluded that the South Korean report was probably designed to squeeze funds out of a reluctant administration, more interested in transforming a rice paddy into a new national capital than planning for the nation's defense, independent of US ground troops that will be relocated.
These sorts of quantitative match-ups have proven meaningless in the past. Remember Gulf War I? At that time analysts warned that Saddam Hussein's standing army, battle hardened from years of conflict with Iran, would prove a formidable adversary to the more technologically advanced US coalition troops. Quite the opposite proved true. Saddam's regular army collapsed in the first days of battle against an opponent that could lay waste from afar, denying the Iraq army the chance to fire a shot before its armor was decimated - large numbers being no match for superior technology.
Again in 2003, Iraq's military hardware, weakened by years of US-driven United Nations sanctions, quickly caved. It is not armor and men in uniforms that is inflicting casualties on the US forces today, it is their opponents' utilization of asymmetric strategies that is proving hard to counter - and this is North Korea's strength as well.
The 75 or so more advanced MiG-29s and Su-25S the North possesses won't be involved in dog fights with their South Korean and US counterparts. The North is not planning for, nor does it have the resources to fuel, a wide, protracted battle. Rather, the North Koreans will likely use a blitzkrieg approach, making heavy use of its special forces.
North tops in special forces, 100,000
According to Joseph Bermudez's book The Armed Forces of North Korea, a definitive guide to North Korean military capabilities, the North has more than 100,000 such troops, the largest group of its kind in the world. In a conflict, they would be used to capture and destroy vital South Korean infrastructure and installations, while confusing the responding defense forces. It is widely speculated that these forces wearing South Korean uniforms will infiltrate the South in order to exacerbate the chaos. The number of North Korean special operatives now in the South is unknown, but is thought to be substantial.
US airmen working on the US Air Force's Osan Air Base 30 miles south of Seoul, for example, are housed largely off-base, making them easy targets for North Korean operatives in the run-up to a surprise attack. Further, North Korea has been tunneling under the Demilitarized Zone (DMZ) since open hostilities ceased in 1953. So far four tunnels have been unearthed, the latest in 1989, but others are believed to still exist.
South Korea is a small country of only 98,000 square kilometers. North Korean jets can reach the capital in six minutes from their forward bases. North Korea's 12,000 artillery tubes and 2,300 MLR (multiple-launch rockets/ medium-long range) hidden in caves and underground are all within striking distance Seoul, while its medium range Nodong ballistic missiles can reach US assets throughout the South and in Japan. In the mid 80's North Korea managed to import 87 American-made Hughes MD500 helicopters, the same type South Korea uses as gun ships. The area between Seoul and the DMZ is heavily wooded and mountainous, perfect for guerrilla warfare.
Of course this has always been the problem; the frontier terrain has not changed since the last Korean conflict and the North Korean strategy to utilize its special forces troops to destroy, control and confuse is well known, but today there's an additional obstacle to defending South Korea - perception in the South.
South Korea's engagement policies, begun in earnest in the weeks following the June 15, 2000, summit between president Kim Dae-jung and Pyongyang's leader Kim Jong-il, marked the beginning of a government policy to change the way North Korea is depicted, essentially whitewashing the threat perception of the South's erstwhile nemesis. Textbooks were altered and government literature and policy was changed in a kinder, gentler approach to the misunderstood Northern brethren.
Inter-Korean activities are strongly encouraged and have proven very effective in changing the way South Korea's younger generation views the North. Major examples are the 2002 Asian Games in Busan in which over 350 North Korean athletes and "cheerleaders" attended, followed by the 2003 World University Games in Daegu where 520 North Koreans, including over 300 cheering propagandists, joined hands with South Koreans to sing unification songs.
Kinder, gentler approach of South to North
State-run media has softened its rhetoric, no longer reporting the jingoistic tendencies of the northern reclusive state with dramatic effect. In the closing days of the World Cup competition in 2002, a North Korean naval vessel attacked and sank a South Korean navy ship inside South Korean territorial waters. Two years later, not one politician from either the ruling or opposition camps attended the memorial for the six South Korean sailors who perished, and most of the nation's media outlets relegated the story to the back pages, if they covered it at all.
Many South Koreans, whether civilians or in uniform, no longer consider the North to be a threat - rapprochement policies have been a success, at least in South Korea. Unfortunately the North has not moderated its belief in unification by force, making the South vulnerable. As North Korea's military hardware is deployed in close proximity to Seoul, rapid reaction is the key to defense. But political engagement policies, designed to reduce South Korean's fear of North Korea, have reduced the nation's mental preparedness. After the naval skirmish in 2002, one young South Korean sailor confessed that he "didn't think the North would attack us". North Korea is no doubt well aware of this perceptual change, and no amount of military hardware is going to change the way the North is perceived. Timing is everything, a few minutes of confusion is all that is needed to carry out a crippling assault on South's infrastructure, military and otherwise.
Solutions are difficult. South Korea will not go back to its Cold War readiness: finger on the trigger, warily watching every move of its Northern adversary. The solution lies not in going back but in moving the North ahead, altering the perceptions within the North vis a vis the rest of the world. The North's constant war-footing, the nation's military-first philosophy, which defines the political structure of the country, is incongruent with perceptual change. North Korea's leaders need the imminent "threat" of attack to justify the system and its privations. The perception will moderate only when the North's political lens, through which outside reality is passed, is fundamentally, irreversibly, changed.
David Scofield, former lecturer at the Graduate Institute of Peace Studies, Kyung Hee University, is currently conducting post-graduate research at the School of East Asian Studies, University of Sheffield, United Kingdom.
(Copyright 2004 Asia Times Online Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)

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Death of Kim's consort: Dynastic implications
By David Scofield
North Korea is synonymous with death. The widely circulated news of Kim Jong-il's consort's death is important not in the circumstances of her demise, but in the questions of dynastic succession it has brought to the fore - who will inherit the mantle of despot in the Democratic People's Republic of Korea? Kim Jong-il is 62.
Kim's appetite for exotic food and fine alcohol is surpassed only by his appetite for female flesh, an indulgence that led him to Koh Young-hee, formerly a dancer in one of Kim's many "pleasure teams", groups of stunningly attractive girls trained in providing for his every desire. Divided into three broad categories, the women provide "satisfaction", "happiness", and "dancing and singing". Koh was a member of the third group and became Kim's consort.
Born in Japan to wide-eyed idealists who left for the North Korean "workers' paradise" in the early 1960s, Koh became one of a 2,000-strong stable of young girls "fortunate" enough to be chosen to pleasure Kim. It was while she was dancing in one of the Kim family's 32 villas and palaces that the then junior Kim became enamored with Koh. Though they never formerly married (Kim already had a wife and mistress), they became very close and Kim fathered two sons with Koh: Kim Jong-chul, 23, and Kim Jong-woon, 21. Of course, by the time of her death, reportedly of cancer, Koh was no longer "the former dancer" but had been bestowed the titles "esteemed mother" and "great woman".
And then there's 'Fat Bear'
Kim Jong-il's eldest son is Kim Jong-nam, the offspring of previous mistress Sung Hye-lim, a former actress who died two years ago in a Moscow hospital, exiled and estranged from the leader. Jong-nam has been widely considered to be Kim's heir-apparent, though this is now far from certain. Some, such as the leader's former Japanese sushi chef, who has written about Kim under the pen name Kenji Fujimoto, observed him referring to Jong-nam as "too feminine", lacking the masculine character leadership requires, and indicating a preference for the youngest. But this raises other issues concerning Confucian roles - the youngest son assuming control ahead of the eldest would be a major, and potentially destabilizing, departure from Confucian ethos.
In the past Kim Jong-nam had been widely viewed as the obvious successor. He had the right familial rank, and there is little effeminate about Kim's portly son. North Korean defectors believe Jong-nam responsible for the Hyesan purge, a "removal" of 40 individuals involved in illegal trade during the height of the famine 1996. But his love of Disneyland proved to be his undoing.
In 2001, Kim Jong-nam and his entourage, bedecked in diamond-encrusted Rolex watches and toting Louis Vuitton bags, were detained at Narita airport, reportedly en route to Tokyo Disneyland. Kim had attempted to enter the country on a forged Dominican Republic passport, using the Chinese name Pang Xiong - Fat Bear. Subsequent investigations revealed that this was not his first foray into Japan. Apparently he entered the country at least three times in late 2000. Indeed, a hostess at the exclusive gentlemen's club Soapland in Tokyo's Yoshiwara district remembered Kim's US$350-per-hour visits. She also recalls a dragon tattoo on Kim's back - tattoos are a taboo in Confucian society as they are seen to be a desecration of the body. Still today in South Korea, men with tattoos usually are thought to be members of criminal gangs.
Kim Jong-il was livid. The eldest son had embarrassed the leader and Jong-nam's place near the top of the North Korean food chain and dynasty was - and is - in doubt. Jong-nam's whereabouts are not known. He was reported to be spending his days gambling in Macau, but some experts believe the family rift has been repaired, at least partially, and he is now said to be back in North Korea, perhaps working on national cyberprojects. Before his embarrassing transgressions, he guided the Korea Computing Center (KCC), a high-tech research center outside of Pyongyang described as "advanced" by Jim Hoare, the former charge d'affaires of the British Mission in North Korea and one of the few foreigners to have visited the complex. According to the KCC website, primary research areas include the development of Linux technology. In a world dominated by Bill Gates and Microsoft, North Korea is opting for open-source - perhaps there's hope for the reclusive nation yet.
And then there's the first lady
While the deceased Koh may be "esteemed mother", she isn't "first lady". That title is reserved for Kim's only surviving (that we know about anyway) sibling, his sister Kim Kyung-hee. Kim had a brother earlier in life, but the poor lad drowned in a pond on one of the Kim estates while, it's rumored, Kim Jong-il looked on. The leader is reported to be very close with both his sister and her 33-year-old son (his name is not known beyond North Korea), raising speculation about his potential role as leader of the moribund nation.
Many experts dismiss this possibility, though, as it would end the Kim dynastic line. Kim Jong-il's nephew's father is Chang Sung-taek, vice director of the ruling Korean Workers Party's organization and guidance department and, according to senior North Korean defector Hwang Jong-yup, the de facto No 2 man in North Korea. For years, Chang enjoyed the position closest to Kim, thanks in no small measure to his marriage to Kim's sister.
But defector testimony and South Korea-based analysts indicate that Chang and Kim Jong-il are not as close as they once were. Chang has been accused of corruption and abuse of power and is now said to be living under virtual house arrest. It has also been reported that Chang and Kim Kyung-hee have parted ways. If true, this could remove Chang from any handover script. His brothers, themselves senior members in the military, will likely be keeping their heads down, fearful of being detained, or purged, themselves.
Kim Kyung-hee's official title is head of the light-industry division of the Workers Party Economic Policy Audit Department. She is believed to have unfettered access to her brother Kim Jong-il. That she has a voice in future leadership decisions is well known, but she possesses something else as well, the keys to the family fortune. US Central Intelligence Agency reports put the Kim family's wealth at around $4 billion, held, it is believed, in Swiss bank accounts. Kim Kyung-hee is charged with managing the "Family's" (writer's emphasis) business, which include gold, zinc and anthracite mining operations and the manufacture, processing and distribution of of opium, heroin and amphetamines, as well as the proliferation of counterfeit currency and other nefarious enterprises. (North Korea's smuggling, according to recent British Broadcasting Corp reports, have employed the Real IRA among others to distribute near-perfect counterfeit copies of US currency notes around Britain and Europe.)
His sister's power goes beyond the management of this conduit for cash upon which Kim Jong-il relies to fund his expensive indulgences: she has the knowledge necessary to expose the intricate network that ensures Kim's wealth and power. This information would be invaluable to those governments concerned with the dictator's nuclear-weapons program and his disregard for human life - administrations that hope to bring about real change in North Korea through the removal of this system of dynastic despots.
With so much senseless death and suffering in North Korea, it's hard to be too concerned about the death of one like Koh. Scores of ordinary North Koreans perished from treatable ailments over the past year while the elite, such as Koh, secured the best treatment abroad, regardless of expense. The death of Kim Jong-il's favorite is noteworthy because it underscores the fragility of the succession and the potential for instability at the zenith of power in North Korea.
David Scofield, former lecturer at the Graduate Institute of Peace Studies, Kyung Hee University, is currently conducting post-graduate research at the School of East Asian Studies, University of Sheffield, United Kingdom.
(Copyright 2004 Asia Times Online, Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)

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Chilling warning on day of tears: 70,000 al-Qa'ida terrorists at large
By Raymond Whitaker
12 September 2004
More than 70,000 al-Qa'ida-trained terrorists remain at large around the world, a leading expert has warned, as ceremonies were held yesterday to commemorate the third anniversary of the 9/11 outrage.
The continuing threat of terrorism was reinforced by two blasts yesterday near Western-linked banks in the Saudi port of Jeddah, injuring at least one person. The US consulate in the city was closed as a precaution following the spate of attacks on Western targets in Saudi Arabia over recent months in which 90 people have been killed.
In Indonesia the authorities released security camera footage of a suicide bombing in the capital, Jakarta, which killed nine people and wounded more than 180 outside the Australian embassy on Thursday. The attack has been claimed by Jemaah Islamiah, a group linked to al-Qa'ida.
President George Bush marked the 11 September attacks by warning of continued danger to the US and pledging victory over international terror. "We will not relent until the terrorists who plot murder against our people are found and dealt with," he said in a live radio address from the Oval Office, surrounded by relatives of victims of the World Trade Center and Pentagon attacks.
After attending a prayer service, Mr Bush, Vice-President Dick Cheney and their wives took part in a silent commemoration at the White House. The Defence Secretary, Donald Rumsfeld, was at the Pentagon, where 184 people died, and John Kerry, Mr Bush's Democratic opponent, attended a service in Boston. The largest ceremony was at Ground Zero in New York.
Since Mr Bush declared a "war on terror" in the wake of 9/11, some 3,500 members of al-Qa'ida and affiliated groups have been killed or captured, including several leading figures. But Osama bin Laden, his second-in-command, Ayman al-Zawahiri, and Mullah Omar, the Taliban leader who gave them a base in Afghanistan, have not been captured.
Daniel Benjamin, former counter-terrorism adviser to Bill Clinton, warned that 70,000 terrorists trained at Afghan camps remain at large. He criticised the Iraq war as "a mistake" which had pushed many moderate Muslims towards terrorism.
The Bush administration, he said, had failed to understand that the war against terrorism was an ideological campaign, and targeting states or individuals was not the answer.

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Al Qa'eda terrorists 'plan to turn tanker into a floating bomb'
By Philip Sherwell, Massoud Ansari and Marianne Kearney
(Filed: 12/09/2004)
Fanatics from the Islamic terror faction blamed for last week's suicide attack on the Australian embassy in Indonesia are planning to hijack an oil tanker or freighter and turn it into a floating bomb, The Telegraph has learned.
United States intelligence has passed on warnings about the plot to launch an attack in the region's busy shipping lanes to several countries, including Indonesia, Singapore and Malaysia. They acted after intercepting communications between activists from Jemaah Islamiah (JI), a network linked to al Qa'eda.
The terrorists have been discussing plans to seize a vessel using local pirates. The hijacked ship would be wired with explosives and then directed at other vessels, sailed towards a port or used to threaten the narrow and congested sea routes around Indonesia.
Strong indications that Islamic extremists are planning a new wave of bloody attacks against Western targets also emerged in Pakistan where detained militants revealed that the latest al Qa'eda video tape was intended to be a trigger for fresh atrocities.
Prisoners captured in recent weeks have told their interrogators that last week's taped message from Ayman Al-Zawahiri, Osama bin Laden's deputy, was a signal for al Qa'eda cells that were already on standby.
"We were told that a new tape either carrying bin Laden or his deputy's message was on its way, and that it was intended to trigger a major terror attack," a senior Pakistani intelligence official told The Telegraph. "The cadres linked to the terror network were told to carry out an attack once this video is released."
In the tape, Al-Zawahiri predicted America's defeat in Afghanistan and Iraq. Security was further tightened at foreign embassies in Pakistan after its release just two days before yesterday's third anniversary of the September 11 attacks. Pakistani officials investigating the activities of Mohammed Naeem Noor Khan, the al Qa'eda computer expert believed to have been co-ordinating a plot to bomb Heathrow airport, have recovered further information from the arrested man's computer.
Khan and other militants had collected detailed lists of local and international staff of American and British missions working in Pakistan and senior officials in the war on terrorism. The information included home addresses, daily travel routines and even names of schools attended by the children of foreigners under surveillance.
In Indonesia, Australia's top policeman said yesterday that the militants behind the embassy attack on Thursday were believed to have deployed a second team of suicide bombers in Jakarta.
"There's further intelligence in the last 24 to 48 hours of a second group active in the area," said Mick Keelty, the Federal Police Commissioner, who flew to Jakarta to investigate the blast that killed nine Indonesians and injured 182.
Police released video recordings of the blast from two security cameras yesterday. They showed a van passing on its way to the embassy before blowing apart in a flash of smoke and debris, shaking trees and buildings before the image went blurry.
The attack indicated that JI remains a lethal force, despite the arrest of more than 200 activists across south-east Asia, including Hambali, its alleged mastermind, who was seized in Thailand last year.
Azahari Husin, a British-educated explosives expert who is believed to have made the devices that blew up a Bali disco in 2002, killing more than 200 people, and the Marriott hotel in Jakarta last August, has emerged as the organisation's most wanted man.
Indonesian police said yesterday that he had been recruiting members in recent weeks in Java, the biggest island in the world's most populous Muslim country, as JI regained strength following the arrests.
Husin, a Malaysian who completed a engineering doctorate at Reading University in 1990 and later trained at al Qa'eda camps in Afghanistan, is believed to have only recently moved out of a rented house in north-west Jakarta.
Following a tip-off after Thursday's attack, investigators raided the abandoned home and discovered traces of TNT explosives and sulphur, matching residue found at the embassy bomb site.
The rejuvenation of JI will heighten concerns in Australia that the country could face terrorist attacks on its soil ahead of parliamentary elections on October 9. John Howard, the conservative prime minister, is a strong backer of President George W Bush's war on terror and 850 Australian troops are serving in Iraq.
A purported claim of responsibility for the Jakarta attack was made by JI in a statement on the internet that threatened Australia with more attacks if it did not withdraw its troops from Iraq.

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Ex-policeman 'masterminded Beslan terror'
By Tom Parfitt in Nazran, Ingushetia
(Filed: 12/09/2004)
A police sergeant from Ingushetia who disappeared six years ago is accused of being among the ringleaders of the Beslan siege. Officials of the republic's interior ministry believe that Ali Taziyev, who worked for Ingushetia's external security division protecting government officials, has turned into a ruthless killer since he was caught up in a kidnapping involving Chechens in 1998.
His family believes that he is dead, but the interior ministry claims that he joined the Chechen rebel movement and has taken part in several operations against Russian forces, under the codename Magas.
Officials now suspect that he was one of four commanders who masterminded the attack on School Number One in Beslan in which more than 330 people died, more than half of them children.
Musa Apiyev, Ingushetia's deputy interior minister, told the Telegraph: "The fighter known as Magas, who is the former police officer Taziyev, is connected to a series of terrorist attacks and there is evidence that he participated in the Beslan incident." Mr Apiyev said that Magas was the "leader of a bandit formation" based in Ingushetia. The tiny republic, flanked by mountains, has suffered in recent years from the spill-over of conflict from neighbouring Chechnya.
Police released a photograph that, they say, shows Taziyev earlier this year with Shamil Basayev, the Chechen warlord accused by Moscow of organising the Beslan attack. The Russian security service, the FSB, has offered a ?5.5 million bounty for information leading to the capture of Basayev and another Chechen leader, Aslan Maskhadov.
In the week since the siege began, investigators have been piecing together the identities of the terrorists. The small town in North Ossetia, the Christian region that abuts Muslim Ingushetia, became the focus of world attention when 32 terrorists stormed the school and took hostage 1,100 pupils, parents and teachers, on September 1. More than 330 people were killed and hundreds more wounded when the siege came to a bloody end two days later.
Recordings of the terrorists' telephone conversations reveal that they repeatedly referred to a man called Magas, although it is unclear whether he was in the building or directing operations from outside.
A search for Taziyev was launched last month after he was accused of taking part in attacks on police stations and government buildings in the republic's capital, Nazran, in June, which killed almost 100 people.
He is also suspected of involvement in an assassination attempt on the Ingush president Murad Zyazikov earlier this year.
Police officials say that the other three commanders who organised the attack were also known by codenames: The Colonel, Abdullah and Fantomas.
Russia's general prosecutor, Vladimir Ustinov, told President Vladimir Putin last week that "The Colonel" led the operation inside the school. He has been tentatively identified as a senior rebel from southern Ingushetia. Fantomas is thought to have been a Russian or Chechen former bodyguard to Basayev. Abdullah is believed to be from Ossetia.
Mr Apiyev said: "There are more and more small units moving around in the forests and mountains in the North Caucasus who were only inside Chechnya in the past." He said many fighters were recruited through extremist Muslim communities known as Jamaats.
It remains unclear why the shy, young policeman joined the anti-Russian fighters. He has not been seen since October 10, 1998, when he and a fellow officer were ambushed while protecting the wife of a presidential adviser in Nazran. They were all piled into a car and driven into Chechnya.
A few months later, the wife was freed. The body of the second policeman was found a year later. Taziyev, however, had disappeared.
His family gave up looking for his body in 2001. "We heard nothing, even when his father died," said his mother, Lida, in an interview. "If he was alive, he would have at least passed a message to us."
Investigators, however, believe that he may have been an accomplice in the kidnapping, drawn by the prospect of ransom money. The headquarters of the Ingush interior ministry is still pockmarked by gunfire from the June raids on Nazran. Dozens of officers were killed in the attacks. Major Madina Khadzieva said that the attacks on the city and the school in Beslan were carried out by the "same bandits with the same style of attack". Magas, she claimed, was among the leaders on both occasions.
"Just a few days before the Beslan siege, we received information that a school in Nazran would be attacked," she said. "That was almost certainly a diversionary tactic by the same group."
Taziyev's family, however, is adamant that he is innocent. His younger brother, Alan, said: "The police used to think that someone else was Magas. Now they have discovered that that person is dead and they are looking for a new scapegoat."
Woman sentenced in weapons-export scheme
A Southern California woman was sentenced to one year in federal prison Thursday for her role in a scheme to use her export company to illegally export arms parts to the People's Republic of China...


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US favours Herat governor removal
KABUL, September 14 (Online): The United States has supported the Afghan government's decision to sack Governor of Herat and said the change would bring peace and stability in the troubled province.
Zalmay Khalilzad, the US ambassador to Afghanistan told BBC Radio that he supported freedom to people to hold demonstrations but destruction of government and non-governmental offices could not be allowed.
He said, "citizens are free to comment government policies but use of force or violent means to register their protest in this regard can not be tolerated at any cost".
He said recent acts of violence in Herat required sustained solution.
"Ismail Khan as the governor of Herat proved very destructive not only for the province but also for the entire region", he said.
The US diplomat further said the situation would have been different (in Herat), had they (Ismail led government) did not stop Commander Amanullah Khan from entering the province".
He termed the change a positive move before the presidential elections in Afghanistan.
He further informed he had meetings with former and newly appointed governors of Herat and assured US support to Saeed Mohammad Kherkhaw, the new governor.
He said the US troops were closely monitoring the developments in troubled province.
To a query, Zalmay said 27,000 people would be disarmed in the country during the ongoing drive for the purpose.
US deploy forces in Herat
US tanks rumble through Herat city as the American soldiers flanked by Afghan National Army have stationed in sensitive state administration buildings Monday, according to the latest reports relayed from Western Afghan city of Herat presided by powerful warlord Ismail Khan.
Helicopters and airplanes hovering over the restive city of Herat have deployed forces as the looters began to ransack foreign missions and UN offices.
Fighting erupted after the dismissal of former Herat governor Ismail khan have left ten civilians dead or injured.
The city is turned into a spirit town after trade centers, shopping mals government offices were closed in fear of the heavy gunfire traded between the US forces and Ismail Khan supporters.
Ismael Khan followers have staged fierce protests against the former governor's appointment as the new Afghan minister of mines and industry and called on the Afghan interim President Hamid Karzai to return him to power.
The peaceful protest turned into a riot as the Herat-based US soldiers aided by Afghan National Army (ANA) stepped in to ease violations.
Afghan City of Herat quiet after weekend riots
The western Afghan city of Herat is reportedly calm after riots over the weekend, in which at least four people were killed and about 50 injured.
A curfew was imposed late Sunday after hundreds of demonstrators attacked United Nations' buildings in the city and clashed with US and Afghan forces after local governor, Ismael Khan, was removed from his post on Saturday.
President Hamid Karzai, who is the favourite to win Aghanistan's first ever direct presidential election on October 9, sacked Mr Khan and appointed a replacement as part of his campaign pledge to rein in warlords.
Mr Karzai, who was named interim president in 2002 after a US-led invasion toppled the Taliban, faces 17 rivals in the vote.
Earlier, Ousted governor of western Afghanistan's Herat province appealed to his supporters in a television statement to avoid violence, after at least four people were killed in clashes following his sacking.
Hundreds of demonstrators attacked United Nations buildings in the city and clashed with US and Afghan forces on Sunday after the long-term provincial governor's sacking a day earlier.
The Kabul government Sunday announced that Khan was appointed as the minister of mines and industries and his post was given to Afghan ambassador to Ukraine, Saeed Ahmad Khair Khowa, angering Khan's supporters.
"I hope with patience, tolerance and a single aim you ensure security, peace and stability of your country and be tolerant," said Khan in his statement.
"Reshuffling and changes in a government are a normal thing," said Khan. "I am deeply affected by the number of brothers killed or injured in the past 24 hours."
Hundreds of demonstrators threw stones at the US soldiers and attacked UN offices in Herat.
"Four people were killed and tens were injured," provincial TV announced, adding that curfew was imposed from nine pm in the province.
End.

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Iran makes 'temporary' concession on nuclear plans
Compiled by Our Staff From Dispatches AP, Reuters
Monday, September 13, 2004
VIENNA Iran's refusal to give up all uranium enrichment, and thus banish suspicions that it is interested in nuclear arms, set the stage for a confrontation at a meeting of the UN nuclear watchdog agency that began Monday, with the United States lobbying its allies to have Tehran taken before the Security Council. Hossein Mousavian, Iran's chief delegate at the meeting of the agency's board here, said that "at the moment" Tehran had imposed a partial freeze on enriching uranium and on assembling and making parts for centrifuges, a key part of the enrichment process, which can produce bomb-grade fuel. Mousavian said the suspension was a voluntary gesture on Iran's part to build confidence. But he told reporters it would continue "just for a short, temporary period." Mousavian gave no indication of when Tehran planned to resume uranium enrichment.
Although officials of the UN nuclear watchdog, the International Atomic Energy Agency, declined to comment, a senior diplomat familiar with the agency said it was checking on the claim of a partial freeze.
The agenda for the meeting also included a report from the agency's chief, Mohamed ElBaradei, on South Korea's clandestine uranium enrichment and plutonium extraction experiments. The issue of Iran is not expected to be discussed before Tuesday at the earliest.
The United States appeared to soften its oratory before the opening session in apparent recognition that it might not get its way on Iran immediately. But its case was bolstered over the longer term when important European allies agreed to set a November deadline for Iran to meet demands meant to banish concerns over its possible pursuit of nuclear weapons.
In a confidential draft resolution prepared by France, Germany and Britain and made available to The Associated Press, the three European powers warned of possible "further steps" by the next International Atomic Energy Agency meeting in November.
Diplomats defined that phrase as shorthand for referral of Iran's case to the UN Security Council if Tehran hinders the investigation or refuses to suspend uranium enrichment.
ElBaradei suggested that he did not consider November a deadline. (AP, Reuters)
Copyright ? 2004 The International Herald Tribune | www.iht.com


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A battered UN needs to go back to its roots
Simon Chesterman IHT
Tuesday, September 14, 2004
59th General Assembly
NEW YORK As the United Nations General Assembly opens on Tuesday, the world organization faces twin crises in its effectiveness and its legitimacy.
Ten years after the Rwanda crisis, the UN's inability to prevent genocide has been on painful display during the hand-wringing over Sudan. The United States has invoked the "g" word, but it is unclear that the political will and necessary troops are available to support the escalation in rhetoric.
At the same time, the United Nations remains scarred by the war in Iraq and its bloody aftermath. The failure of the Security Council to contain Saddam Hussein to the satisfaction of the United States - or to contain the United States to the satisfaction of even its allies - suggests a crisis in legitimacy that questions the very idea of the United Nations as a significant actor in international peace and security.
Now that an Iraqi government has taken formal control of Iraq - and the United Nations has demonstrated its importance to the United States in achieving this - might the time be right to push for reform of the United Nations?
Major international institutions of peace and security are difficult to forge in the absence of crisis. World War I was the backdrop for establishment of the League of Nations. The league's failure to prevent World War II led to its replacement by the United Nations. For some, the U.S.-led invasion of Iraq in March 2003 was a similar challenge not merely to the institutions but to the very idea of international order.
The war split the Security Council, divided NATO and prompted the UN secretary general, Kofi Annan, to create a high-level panel to rethink the very idea of collective security in a world dominated by U.S. military power.
This panel is now the most prominent effort to reform the United Nations. Whether it or any other reform effort can succeed in improving the United Nations - or, perhaps, saving it - depends in large part on how the relationship between the United States and the United Nations is managed.
The General Assembly this year will lay the groundwork for the 60th anniversary celebrations of 2005. Over the next 12 months, governments will be responding to the report of the high-level panel and a separate meeting will review the Millennium Declaration and evaluate progress toward the Millennium Development Goals. It is possible that these major reviews of the security and development agenda of the United Nations will be brought together.
This would recognize the different ways in which different people experience modern threats. While the combination of terrorism and weapons of mass destruction is the primary fear of many Western countries, economic concerns dominate in the developing world. It might be possible to link these issues, securing greater cooperation from developing countries for counterterrorism and counterproliferation activities in exchange for greater development assistance and reform of agricultural subsidies by Western countries.
It is far from clear, however, that there is an atmosphere of crisis of the kind needed to bring about change on this scale.
President Franklin Roosevelt pushed for the negotiation of the UN Charter to be held in San Francisco while the bombs of World War II were falling. Unlike the Covenant of the League of Nations, which was negotiated as one agreement among many at Versailles in 1919, the Charter's references to "the scourge of war" were reinforced by daily reports of the final battles of the global conflict.
With that in mind, it might help present reform efforts to move next year's UN General Assembly to a special session in San Francisco. This would serve three purposes.
First, especially if led by the United States, it would help to emphasize the important role played by America in establishing the United Nations as an instrument of enlightened U.S. self-interest, rather than a barrier to it.
Second, the next UN secretary general is expected to be from Asia, so it would be appropriate to convene the assembly on the edge of the Pacific.
Finally, it is possible that recalling the atmosphere of crisis that accompanied the drafting of the UN Charter 60 years ago will remove the need for a comparable crisis in order to change it.
Simon Chesterman is executive director of the Institute for International Law and Justice at New York University School of Law.
Copyright ? 2004 The International Herald Tribune | www.iht.com
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U.N. Reform

Updated: September 13, 2004


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Is reform on the agenda when the U.N. General Assembly opens?
Talk of reform at the United Nations--particularly of the Security Council--is not new. But this year, as the U.N. General Assembly begins its annual session on September 14, a panel of distinguished experts is preparing a report that could recommend radical changes in the way the United Nations operates. The panel, which will report to Secretary-General Kofi Annan by December 1, is examining how the United Nations can best respond to global security threats. It may recommend major changes, such as expanding the Security Council or creating closer links between it and other U.N. bodies. However, the General Assembly will not consider the panel's proposals until September 2005, and experts warn that past U.N. reform efforts have met resistance from member-states and the large, entrenched U.N. bureaucracy.
Why did Annan create the panel?
Annan appointed the 16-member High-Level Panel on Threats, Challenges, and Change in November 2003, after a devastating year for the United Nations. The bitter policy debates that divided world opinion before the war in Iraq; the August 2003 bombing of U.N. headquarters in Baghdad that killed 23--15 of them U.N. staffers, including Special Envoy Sergio Vieira de Mello; and the lack of a clear U.N. role in Iraq damaged confidence within the organization and raised questions about what the United Nations' mission should be. Annan has assigned the panel the task of redefining the United Nations to face new threats, a job he says is as important as the body's founding in 1945. "He wants to be bold, and he wants them to be bold," says William H. Luers, president and CEO of the United Nations Association of the United States of America, a nonprofit organization that encourages support for the work of the United Nations.
What did Annan ask the panel to do?
Primarily three things, says Thant Myintu, a political officer in the U.N. policy planning unit:
Define and analyze contemporary threats to world peace and security. "Now, more than at any other recent time, there's a greater division [between countries] in their perception of threats," Myintu says. In the 1990s, the United Nations shifted its focus from the Cold War to the threats of failed states and civil wars. Now, in an age of terrorism, another such shift is needed, experts say.
Examine the ability of the United Nations, across its entire system of non-governmental organizations and related bodies, to respond to those threats. For example, effective reforms to halt the nuclear weapons trade will involve not only the Security Council but also the International Atomic Energy Association, while bans on chemical weapons will involve the Organization for the Prohibition of Chemical Weapons, established in 1997 to implement the Chemical Weapons Convention.
Recommend changes to maximize the United Nations' effectiveness in responding to those threats.
What are the major issues being discussed?
The panel is studying six so-called baskets of issues combining hard (military) and soft (social and economic) threats. These are broadly defined as:
classic inter-state conflict, i.e., war between countries;
internal violence, including genocide;
poverty and disease;
weapons of mass destruction (WMD);
terrorism; and
organized crime and corruption.
What challenges do the reformers face?
Experts say the panel faces a potential conflict between first and third world countries, which see security threats very differently. Industrialized nations consider terrorism and WMD the biggest threats to their security, experts say, while developing countries view AIDS, poverty, disease, and hunger as their most pressing risks. The panel must address both those viewpoints, experts say, although "in actual practice, the U.N. is likely to be more responsive to the threats seen by the first world countries," says James A. Paul, executive director of Global Policy Forum, a nonprofit organization that monitors policy-making at the United Nations.
The panel will also wrestle with several other hotly contested issues, including what position the United Nations should take on the doctrine of pre-emption. A country's right to attack an enemy in order to prevent a likely attack on itself--which the United States used to justify invading Iraq--has been highly controversial at the United Nations, experts say. "Pre-emption is still an issue that divides most of the countries in the world," says Robert Orr, assistant secretary-general for policy planning at the United Nations. Officials realize that, in a world in which terrorists can buy WMD, countries can't always afford to get U.N. permission before an attack, experts say. But the unrestricted use of force is not acceptable, either.
Will the panel recommend expanding the Security Council?
Experts say there is growing international pressure to expand the Security Council, which currently has 15 members. Five of those--the United States, United Kingdom, France, China, and Russia--are permanent members with a veto; the other 10 are elected by the General Assembly to two-year terms and do not have a veto. The 10 seats are allocated as follows:
two seats for Western Europe and the Commonwealth countries, including Canada and Australia;
three seats for Africa;
two seats for Asia;
one seat for the Middle East that takes one spot from Africa or Asia in alternate years;
one seat for Eastern Europe; and
two seats for Latin America/Caribbean.
Many developing countries argue that the Security Council needs broader geographical and economic representation. The panel is reportedly considering increasing Security Council membership from 15 to 24 members in three levels:
The first level would consist of the current five permanent members, who would keep their vetoes.
The second level would include seven or eight semi-permanent regional members, who would be elected for renewable terms of four or five years and would not have a veto. Some of the candidates for this group, including Japan, Germany, and India, have campaigned for permanent seats with vetoes. Brazil, South Africa, Egypt, and Nigeria are also mentioned as potential second level members.
The third level would replicate the current system, with 11 or 12 regional members elected for non-renewable two-year terms.
Other suggested reforms include making all Security Council seats elected or creating seats for regional bodies like the European Union or the Arab League; most experts say they are unlikely to be enacted.
What do the existing permanent members say about expanding the Security Council?
Experts say that while the five permanent members make public statements supporting expansion, they talk very differently in private. There's no chance any of the five will give up their vetoes, experts say, or share that power with other countries. "There's a huge gap between rhetoric and reality," Paul says. He says most experienced U.N. diplomats privately oppose expanding the council, arguing that a group larger than 15 members would be too cumbersome to get anything done.
What happens next?
The panel must submit final recommendations to Annan by December 1. Annan will then add modifications and circulate the report to member states for discussion in their countries and at U.N. forums. He will formally present the panel's findings to the U.N. General Assembly in September 2005. To be adopted, the reforms must be approved by a two-thirds majority of the General Assembly. Experts say Annan has invested a sizable amount of his personal prestige in the reform project. "This is important to him," Orr says. "He wants to leave the organization [at the end of his term in 2006] in good shape to meet the new challenges of the 21st century."
What are the chances that reform will be enacted?
Some experts are hopeful. "This is an issue that's been batted around for a long time, but this time there's a lot of momentum," Orr says. "It could happen." Luers says the world body has been deeply affected by the terror attacks of the last few years and the bruising battles leading up to the war in Iraq. "I think Iraq was a shattering experience for many people," Luers says. "It made them realize that the world has changed." Paul says that the way events have turned out in Iraq--after initial U.S. resistance to a U.N. role, Washington sought the institution's help to organize upcoming elections-- has given the organization greater legitimacy than it had before and shown that no other body can take over its role. "For all its faults, the world is better with the U.N.," he says.
What happened to previous reform efforts?
Experts joke that talk of reform at the United Nations pops up on a "seven-year cycle." Incoming secretaries-general tend to propose reforms; for example, when Boutros Boutros-Ghali began his term in 1992, he consolidated all the U.N. bodies dealing with social and economic issues into one department and eliminated a controversial research center, Paul says. Annan has also made changes to the structure of the secretariat--the U.N. body that carries out the organization's day-to-day work--including creating a post of deputy secretary-general. Secretaries-general are fairly "free to change the secretariat, but more major reforms, like those that change the budget, need member-state approval," Paul says.
-- by Esther Pan, staff writer, cfr.org


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News Analysis: Get-tough tactics in Iraq: Signs of backfire
Dexter Filkins/NYT NYT
Tuesday, September 14, 2004
BAGHDAD The mayhem that coursed through the Iraqi capital Sunday offered the latest evidence not just of the growing ferocity of the insurgency but also of the extraordinary difficulties faced by the American military as its efforts in Iraq enter a new and potentially decisive phase.
With four months to go before nationwide elections in Iraq, U.S. commanders have begun a series of military operations intended to regain control over the large sections of the country ceded to insurgents in recent months - where, if conditions remained unchanged, the staging of elections would be cast in serious doubt.
In cities like Falluja and Talafar and Sadr City, which have slipped out of the control of the Iraqi government, the Americans are embarking on especially aggressive operations with the full support of the Iraqi prime minister, Ayad Allawi. But as the Americans move to regain control of these areas, the insurgency seems each day to be growing more brazen and more sophisticated.
On Sunday, insurgents struck the Americans and their allies in the Iraqi government in manifold ways: with suicide bombings, with mortars and with rockets, many of them showing a careful aim. Many of those attacks seemed intended not just to hurt the Americans but also to provoke them into overreacting and alienating other Iraqis. In that way, the choices confronting the Americans and their Iraqi allies here are similar to those faced by governments battling guerrilla insurgencies in the past: Ease up and the insurgency may grow; crack down and risk losing the support of the population.
The dilemma facing the Americans is that they need to break the deadlock before January, when they insist they want elections to be held. Whether the Americans can hold to their hardline approach is open to question.
In April, as the marines moved in on Falluja and Iraqi casualties soared into the hundreds, they called off their offensive and turned the city over to the insurgents. Even now, the get-tough approach is showing signs of backfiring.
When an insurgent drove a car bomb into a U.S. convoy Sunday, crippling a personnel carrier, a crowd of cheering Iraqis clambered on top.
Then an American helicopter, its pilots saying they were being shot at, opened fire, killing or wounding a number of Iraqi civilians. Inside the grim and chaotic wards of Baghdad's hospitals Sunday, the Americans seemed to have won more enemies than friends.
"When I heard the sound of the bombing, I ran out the door to see what was happening," said Nasir Saeed, a 23-year-old civilian who lay in Yarmouk hospital Sunday. "I saw a Bradley burning in the middle of the street and the people were happy, and then an American helicopter started to shoot at the mob. I fell on the ground, with wounds all over my body."
On Monday, the scene repeated itself in another corner of Baghdad. When a group of three insurgents opened fire on a vehicle carrying a group of American soldiers, they responded in force, firing dozens of bullets, destroying three cars and killing one Iraqi civilian and wounding three. "When the Americans fire back, they don't hit the people who are attacking them, only the civilians," said Osama Ali, a 24-year-old Iraqi who witnessed the attack. "This is why Iraqis hate the Americans so much."
The get-tough approach appears to be straining the Iraqi government as well.
On Monday, Allawi's office said that Mowaffak al-Rubaie, the national security adviser, had been relieved of his duties and replaced with a close ally of Allawi's, Qassim Daoud. The precise reasons for Rubaie's dismissal were unclear, but he and Allawi disagreed sharply over how to quell the Shiite and Sunni insurgencies, particularly with regard to dealing with Moktada al-Sadr, the rebel Shiite cleric. Where Rubaie favored coaxing Sadr into the political mainstream, even before all of his guns were gathered up, Allawi instead simply demanded Sadr's surrender and threatened to crush his Mahdi Army if he did not. At the heart of the problem facing Allawi and the American military is the legitimacy of the elections to be held in January.
Large parts of the Sunni Triangle, the vast area north and west of Baghdad, have fallen out of U.S. control. The Americans have longed hoped that free and fair elections could drain away much of the anger in areas like the Sunni Triangle. But with so many areas out of American or Iraqi government control, it is not clear that elections can be held in those areas.
Still, both the Americans and the United Nations say they are determined to go forward with the January elections, running the risk that huge numbers of voters will not take part. "I could see circumstances where we can't do Falluja," a Western diplomat said, referring to the prospect of holding elections there. "But we will not let the rejectionists in Iraq have a veto over the elections."
Yet as U.S. forces try to retake these cities, some Iraqi leaders warn that they will meet stiff opposition, particularly in the areas, like Falluja and Ramadi, that are dominated by Sunni Arabs. That they will try to enter with the promise of bringing elections will matter little, these Iraqis say. "For sure, if the situation stays like this, it will be difficult to have free and honest elections," said Harith al-Dhari, the chairman of the powerful Association of Muslim Scholars, which represents hundreds of Sunni clerics around the country. "But Iraqis do not rely so much on these elections," Dhari said. "The most important thing is for the Americans to assign a date to their withdrawal. That is the only solution. "When you push the Iraqi people, and you harm the Iraqi people, you will just cause them to fight back harder," he said. "The idea that force will be enough to calm the Iraqis is a false dream." The Americans face a similar dilemma in trying to hold elections in the country's Shiite-dominated areas, where Sadr and his Mahdi Army are still refusing to give up their guns. In recent weeks, Sadr's aides have been traversing the country, soliciting opinions on how he might turn his guerrilla movement into a political party and turn his credibility in Iraq's slums into votes on election day. That is exactly what Mr. Allawi and British and American commanders say they want: Sadr willing to play by the rules. In April and again last month, his militia showed itself capable of seizing and holding the centers of the largest cities in southern Iraq. Unless Sadr can be persuaded to disband his militia, British officers who had to fight him in the south believe that no matter how many of his fighters they kill, he would have enough left to disrupt the January elections across southern Iraq. But Sadr has made these feints before, only to turn back to armed resistance.
It is for that reason, perhaps, that Allawi and American officers are refusing to entertain any such talks with Sadr until he disarms first. His aides, wary themselves and badly bloodied, are balking.
The New York Times



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Media Watch
Sharon-Netanyahu Showdown Looms
by the Debkafiles
Israeli prime minister Ariel Sharon is in a hurry. But the harder he pushes to speed up his disengagement-evacuation plan, the more he provokes the settlement movement, its supporters in his own Likud party and a whole range of opinion, including parts of the military command. His haste has drawn a backlash in the form of the warnings heard in the last few days that forcible evacuations could plunge the country into civil war.
Because no elected body has thus far approved settlement removals, Sharon is manufacturing momentum for a fait accompli by engineering bureaucratic and legislative measures. Tuesday, September 14, he will present the security and foreign affairs cabinet with the principles of a draft law defining the scale of compensation owed settlers for the loss of their homes and businesses in 21 Gaza Strip locations and four in the West Bank. First come, first served. Sharon hopes to squeeze this preliminary step through one day before Israel closes down for the New Year-Yom Kippur-Succoth season on Wednesday, September 15. He is now pinning his hopes on attractive monetary incentives for drawing volunteer evacuees into breaking the wall of opposition to the uprooting of settlements. A settler prepared to relocate in under-populated Galilee in the north or Negev in the south will receive double compensation - roughly the equivalent of $200,000 instead of $100,000.
Changes in the government lineup have improved the prospects of cabinet endorsement for this bill. The prime minister's immediate goal is to pre-empt the massive pro-settlement demonstration scheduled for Sunday, September 12, in Jerusalem.
The controversy is becoming infused with high emotion as both camps raise the stakes in the immediate term. Sharon will brook no suggestion that his plan is stalled and declares with raised voice that nothing on earth will stop the removal of the settlements he has decided to jettison. One settler, Eliezer Hisdai, who lost a daughter in a Palestinian attack, warned defense minister Shaul Mofaz this week of a possible en masse refusal by soldiers to carry out orders. Justice minister Tommy Lapid heatedly accused settler leaders of incitement to violence and defying democratic norms. He warned that the forces of law and order would not take this lying down, sparking a whole new wrangle over the limits of freedom of speech. The settlers retorted that if anyone is violating democratic norms it is Sharon who is dividing the nation over policies for which he has no mandate from any elected body.
Although the issue is genuinely incendiary, DEBKAfile has been told by its exclusive political sources that much of the fresh heat is sparked by a different factor: word is going round the ministers and top political circles that a decision has been reached by former finance minister Binyamin Netanyahu, a former Likud prime minister himself, to run against Sharon in the next party primaries as candidate for prime minister. After biding his time quietly in the wings for the last couple of years, he now tells his confidants it would be a mistake to postpone a direct challenge any longer. His moment has arrived.
Netanyahu has chosen his moment partly under the influence of the latest turnaround upping president George W. Bush's rating in opinion polls. In America, the majority appears unimpressed by the negative media coverage of the president's record in Iraq and Afghanistan. Despite such disappointments as the failure to find Saddam Hussein's weapons of mass destruction and the continuing combat in both countries, Bush is gaining ground against Kerry as a war leader.
Israel's mass media are likewise plugging Sharon's policy as backed by most Israelis. For five years, the Likud prime minister did indeed prove unbeatable. This looks like changing. Since he came up with his stubbornly held plan to remove settlements, his popularity has been sliding. Polls held secretly in the last two weeks among the general public show results that reflect the May 1 poll held in the Likud party - with an important difference. A majority does indeed favor disengagement from the Palestinians, but 58 percent are also against the violent uprooting of settlements. Sharon's attempts to merge the two issues are not accepted.
Where Netanyahu parts ways with the prime minister is in his adherence to traditional Likud tenets, which negate the removal of Jews from their homes in any part of the Land of Israel. In the light of the current mood, he believes he can beat Sharon in a party primary and go on to win a general election as the party's prime ministerial candidate
The finance minister's political timing appears to be apt.
His two main rivals for the succession to the 74-year old Likud leader, both enthusiastic supporters of evacuation, are out of the race for the moment. The party has rejected deputy prime minister Ehud Olmert time and time again. Mofaz by backing the prime minister is tying himself in knots. He is combining his performance as great champion of the Israeli armed forces, lauding their success in warding off continuous waves of terrorists, while at the same time going out on a limb for the sake of the project to remove Israelis, lock, stock and barrel, from the Gaza Strip - against the advice of his own generals, who see great danger ahead.
In a further contortion, Mofaz is trying to shunt the hands-on job of wrestling Israeli civilians out of their homes away from the soldiers and onto the very reluctant police. But he will not be able to keep the soldiers out of the fray. The Palestinians are determined to subject the evictions, if they do take place, to heavy fire in order to demonstrate that they have got the Israelis on the run. The defense minister certainly understands that in such circumstances, the entire project is bound to be fraught with bloodshed, costing the lives of settlers, police and soldiers alike. And after the no doubt traumatic event is over, he cannot be unaware of the perils entailed in unilaterally abandoning the Gaza Strip to an avowedly hostile enemy. By sticking to Sharon, therefore, Mofaz is paying heavily in popular credibility.
If the prime minister is really so sure he enjoys popular support for his plan, as his spokesmen insist, why not hold a general election on the settlement evacuation issue? And why did he reject the proposal advanced this week of a referendum? Above all, knowing what he knows, why is he still hell-bent on pushing down the throat of an unwilling country a policy that is patently divisive and unworkable, at best; dangerous, at worst?
It is this refusal to back off at any price and the Sharon's sliding popularity that Netanyahu has decided to exploit as a fulcrum for swinging back into the prime minister's office.

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Egyptian Government Weekly Magazine on 'The Jews Slaughtering Non-Jews, Draining their Blood, and Using it for Talmudic Religious Rituals'
by MEMRI
Hussam Wahba, a columnist for the religious Egyptian weekly magazine 'Aqidati, [1] published by the Al-Tahrir foundation which is linked to the ruling National Democratic Party , wrote an article based upon blood libels and accusing Judaism of promoting ritual murder. [2] The following are excerpts from his article : [3]
On the Main Entrance to the Knesset it is Inscribed : 'Compassion Toward a Non-Jew is Forbidden'
"... The Jews forgot that their primary constitution, on which they rely, is full of intellectual religious terrorism against all other nations. Aqidati decided to wage a battle against International Zionism in order to expose the extent of terrorism that exists in the Zionist doctrinal mind. The truth of the matter is that the Jews themselves do not deny [the existence of] Zionist terrorism. Whoever visits the Israeli parliament known as 'The Knesset' will notice at the main entrance a sentence written on the wall saying: 'Compassion towards a non-Jew is forbidden, if you see him fall into a river or face danger, you are prohibited from saving him because all the nations are enemies of the Jews and when a non-Jew falls into a ditch, the Jew should close the ditch on him with a big boulder, until he dies, so that the enemies will lose one person and the Jews will be able to preserve their dream of the Promised Land, the Greater Israel!'
"This sentence is taken from the Jewish Talmud which is holier that the Torah itself, and was described by the Israeli Ministry of Education in the lexicon that it published at the beginning of this year for primary school students in Israel as: 'The Talmud is the oral Torah which Moses received from his Creator. It contains commandments, which every Jew must perform. The Talmud is the holy book of the Israelites and its sanctity equals or even surpasses that of the Torah...'"
The Jews' Sacred Obligation to Murder 'Goyim'
" Dr. Muhammad Abdalla Al-Sharqawi says in his book 'The Talmudic Scandals' that the Talmud ... exposes the hidden aspects of the Jewish psyche... The Jewish Rabbis came up with it as a result of the deep distress over [their] exile and fragmentation, which cultivated in the Jewish psyche hatred and loathing and a raging need for vengeance and tyrannical control over non-Jewish nations. To this day Jewish life is based to a great extent on the Talmudic dictates and principles...
"Dr. Al-Sharqawi adds that if we examine the Talmudic attitude toward other, non-Jewish nations, we will find it to be as close as can be to a desire to completely annihilate the 'Goyim' - the non-Jewish nations. For instance, the Talmud says: 'Murdering a non-Jew whenever possible is an obligation. A Jew is a sinner if he can murder non-Jews but does not do so. And a Jewish priest who blesses a person [Jew] who brings evidence that he murdered one or more non-Jews is a blessed priest. Murdering non-Jews pleases God, because the flesh of non-Jews is the flesh of donkeys and their sperm is the sperm of animals.'
"The Talmud also says 'Kill anyone who is not Jewish even if he is pious. The Jews are prohibited from saving from death any member of the other nations, or rescue him from a ditch in which he fell, because that would mean saving an idolater, even though he is pious.'
"Also, the Talmud says that 'it is righteous for a Jew to kill a non-Jew with his own hands, because whoever kills a non-Jew is offering a sacrifice to God...'
"The Talmud also contains instructions to the Jew that if the non-Jew is stronger than him, he should do anything in his power to bring about his death even in an indirect manner and to pin the blame on a non-Jewish nation; this may cause a conflict between two non-Jewish nations to the point of fighting and destroying each other. Then, God will reward any Jew who contributed to the conflict between the two nations with eternal life in Paradise...
" The Talmud did not only deal with killing non-Jews, but permitted the violation of their honor [i.e. women] and property, when it says: 'The Jew is not in the wrong if he rapes a non-Jewish woman, because non-Jewish women are permitted...'
" Dr. Al-Sharqawi concludes by saying: 'All this proves the principle that the killing of non-Jews by Jews is a sacred obligation that the Jew should carry out whenever he can, because, according to the Talmud, his arm is connected to his body for the sole purpose of killing and not for recreation.'"
The Jewish Ideology of Conflict
" Dr. Muhammad Abu Ghadir, the former head of the Hebrew Language Department in Al-Azhar University , points out that the Jews believe wholeheartedly that violence and blood are the only things that safeguard their lives. Their rabbis, throughout history, were successful in convincing them that non-belligerence with the surrounding world would lead to their destruction and that the only way for the Jews to stay alive is to follow the dictates of their holy books concerning the obligation to carry on the conflict with all other nations and to intensify the conflict with relatively weak nations.
"When they see a nation stronger than them, every Jew has a daily obligation to make every effort so that this nation should be weakened to the point that in the end it collapses, or at least becomes weaker than the Jewish nation, so that they may then eliminate it completely.
"The books of the Jewish religion say that in ancient times God addressed his Jewish worshiper, saying: 'You must have an enemy, and if you do not have one, create one so that you can defeat him and kill him and gain God's goodwill and His reward.' If we examine the word 'killing' in the books of the Jewish religion, we find that it is repeated tens and hundreds of times, which indicates to us the enormity of terrorism in Zionist religious thought, especially when we realize that 80% of the religious verses demand of the Jews to kill non-Jews, and even the sentences and the verses that do not talk about killing, and talk about, for instance, God giving the land to the Jews and not to others, you can find between the lines a clear call to the Jews to use all kinds of ploys and tricks to annihilate non-Jews who live on this earth, so that the Jews may take control over it..."
'The Talmudic Dictates Urge Jews to Draw the Blood of Muslims and Christians for Religious Rituals'
" Dr. Jama al-Husseini Abu Farha, instructor in theology at the University of Suez , points out that what the media shows us every day about Israeli conduct in the occupied territories is no different than what their history shows us about their inhumane practices towards humanity as a whole. One need only point out that they are 'blood suckers' according to the Talmudic dictates, which urge them to murder and draw the blood of Muslims in particular, and Christians even more so, and to use this blood in religious Israeli rituals.
"Jewish terrorism reached the point of underscoring that the Ten Commandments - as they claim - assert the right of Jews to plunder and steal non-Jewish money and to see their blood, honor and properties as fair game and to lend them money at [high] interest so long as they do not convert to Judaism."
'The Word Jew in English Means Trickery, Deceit and Deception'
"Zionist terrorism is not confined just to their religious doctrines; even their language reflects their radicalism and their terrorism. The Hebrew language includes many proofs of the truth of Zionist terrorism. The word 'Jew' ... is used in the English language to mean 'trickery, deceit and deception,' all of which signify cunning and slyness. It is strange that the Jews know this very well but did not try to object to it. The Oxford dictionary says that there are words related to the word 'Jew,' among them 'cheat,' 'offensive,' and 'grasping,' and all of them mean greedy, covetous, cheating, counterfeiting, aggressive, and annoying. This link between the word 'Jew' and all these meanings certainly reflects the image of the Jewish way of thinking from an English point of view, and it is undoubtedly a bad image which does not reflect the opinion of one person only but [rather] the opinion of anyone who speaks English..."
Disseminating Blood Libels
"Since admission is the highest form of evidence, we will present to the reader a letter of confession written by the Jewish Rabbi known as 'Neophytos the Convert [to Christianity].' [4] The letter has to do with the Jews slaughtering non-Jews, draining their blood, and using it for Talmudic religious rituals. Neophytos called his letter 'The Secret of the Blood'; in it he said that 'from a young age, the Jewish Rabbis teach their students how to use non-Jews' blood to treat illnesses and for sorcery...
"'The Rabbis use this blood in various religious rituals, among them weddings when an egg is smeared with blood and the married couple eats it the night of the wedding, which gives them the power to deceive and trick anyone who is not Jewish. Also, the Rabbis use the blood of the non-Jewish victim to treat some illnesses that afflict the Rabbis. They mix some of the blood with the blood of a circumcised baby, then brush it on his throat in order to purify him, and also anoint their temples with it to commemorate the destruction of the Temple every year; [it is also used to] anoint the chests of their dead so that God will forgive them their sins; it is also mixed in the holiday bread and in many other Talmudic rituals.'
"Therefore, these rituals that were mentioned in the Talmud and which reflect the truth about the present Jewish terrorist way of thinking are certainly implemented from time to time, while they do not hesitate to distort the image of Islam and describe it as a terrorist faith."



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from the September 14, 2004 edition - http://www.csmonitor.com/2004/0914/p01s04-wome.html
At 10th anniversary, a far poorer Palestinian Authority
The four-year intifada has left the Palestinian economy - and government - in shambles.
By Ilene R. Prusher | Staff writer of The Christian Science Monitor
JERICHO, WEST BANK - When the doors of the Intercontinental Hotel opened here four summers ago, rooms were sold out and the managers had to turn people away. Today, it does not have a single guest and is kept running by a handful of people who watch the minutes tick by in crushing silence.
"When it's empty like this, every hour feels like a year," moans desk manager Jawdat Barakat, who earns a fourth of what he did in the days when the hotel was bustling. Many clients spilled in from the Oasis Casino next door - a joint Israeli-Palestinian investment which has since been shuttered. When the hotel opened, it employed 184 Palestinians. Only about 25 work here now.
Tourism was once the most promising sector of the Palestinian economy. Now business in Jericho, which bills itself as the oldest city in the world, has itself become fossilized.
Jericho's empty streets are a mirror of the downward spiral across the West Bank and Gaza Strip. Ten years ago this week, Palestinian leader Yasser Arafat gained major civilian powers for the first time as part of the Oslo Peace Accords. The Palestinian Authority (PA) soon gained the power to collect taxes, and run health, welfare, and tourism facilities, taking on the trappings of state- hood. Jericho was the first city from which Israeli forces withdrew, and, some say, the most keen to do business with Israelis.
But since the start of the intifada in late September 2000, the economy has been caught in a vicious cycle. In response to suicide bombings, Israel closed its borders to Palestinian workers, reoccupied cities it had turned over to the PA, and clamped down on Palestinian travel between cities. The latter, say people whose income was dependent on the tourism industry, is the primary reason why Jericho's economy is now virtually bust.
Most indicators point to a worsening of economic conditions - and an ever-rougher road for the PA leadership to survive its worst political crisis. Yet, while prominent Palestinians have become increasingly critical of life under the PA, decrying it as "lawless" and "chaotic," it continues to function as a de facto government - and the largest single employer in the Palestinian economy.
"The PA has managed to pay salaries ... that's the only symbol that it's still functioning," says Mohammed Shtayyeh, the director of the Palestinian Economic Council for Development and Reconstruction (PECDAR) in Ramallah.
The Intercontinental in Jericho wasn't alone in making huge layoffs. Approximately 90,000 people who were working in the Palestinian private sector before the intifada have since lost their jobs. But the loss of wages earned in Israel has hurt the most. Some 166,000 Palestinians used to work in Israel before the intifada, compared to 2,411 who do now, according to PECDAR, which was founded as the economic organ of the PA and is still the conduit for disbursing international donor funds. The salaries of those who worked in Israel brought up to $1 billion a year in remittances into the Palestinian economy.
Now the World Bank puts Palestinian unemployment at 28 percent - PECDAR says it's more than 50 percent. Per capita income, which in 2000 was about $2,000 a year for the West Bank and $1,600 for the Gaza Strip, has dropped to $950 and $650 respectively, PECDAR says. This year, for the first time, half of the Palestinian population will be considered to be living in poverty, according the World Bank's most recent study.
With fewer and fewer people working in the private sector, Dr. Shtayyeh estimates that about one-third of the Palestinian public is dependent on a PA salary. Tax collection - a key source of revenue for any government - was spotty to begin with and has plummeted since the intifada. The PA is able to function only through the help of donor funds.
It's not an encouraging trend. Ten years since the PA's founding, it is more dependent on foreign aid, but having a harder time getting it. For example, of the $650 million in aid the PA relies on to pay salaries this year, it has received only $140 million so far. "We are back to the scenario we had 10 years ago," Shtayyeh complains.
Now, in the course of a month, the PA needs $61 million to pay salaries and another $34 million in operating expenses, totaling $95 million. Of that, he says, $17 million comes from tax collection, and another $25 in the form of consumer and value-added taxes that Israel collects on goods coming into the country and then returns to the PA.
The difference has generally been made up by donor countries: about $10 million from the European countries and the rest from Arab countries, particularly Saudi Arabia. Of $1 billion the PA received in 2003, 80 percent came from Arab countries. But the conflict with Israel, combined with Mr. Arafat's increasingly troubled image on the international stage, is making support to the Palestinians a more difficult sell to donors. While there have been years since the post-Oslo Accords when Japan gave $200 million to the Palestinian Authority, last year it only gave $16 million.
Less money from abroad
"There has been a sharp decline in donations, because of the closure and destruction," adds Shtayyeh. "Iraq has been hijacking the attention of other donors. The donors ask us, 'can you guarantee that the project we build will not be destroyed?' We cannot answer that."
But nor has the PA been able to answer to ongoing complaints of corruption and mismanagement. In a recent speech, Arafat acknowledged that his Authority had mistakes and that reforms were necessary, but critics say he has not acted.
"The Palestinian Authority, to a large extent, has failed to manage the Palestinian economy as effectively and efficiently as it should have," says Dr. Nasser Abdelkarim, an economist at Bir Zeit University. "The Authority has never made available any development plan since its existence. We've only engaged in emergency planning and crisis management. The PA made mistakes by granting exclusive licenses for things like telecommunications - and in this they created an unfavorable environment for the expansion of growth in the private sector."
As he speaks in the lobby of another nearly empty hotel, this one in Ramallah, he notices a prominent former minister of Post and Communications, Imad Faluji, sitting behind him. "Let him hear it," Abdelkarim says loudly, referring to the complaints of corruption. "They're all part of what built this problem."
The Palestinian prime minister, Ahmed Qureia, threatened to resign this summer, protesting the growing state of "chaos" in the PA. Across the territories, tensions have been building. In Gaza in July, thuggish young renegades of Arafat's Fatah faction of the Palestinian Liberation Organization (PLO) abducted and beat his police chief, Ghazi Jabali, and continued the wreak havoc after Arafat appointed his nephew, who was widely rejected. Prominent Palestinian legislative council member Nabil Amr - a cabinet minister until last year - was shot in his own home in Ramallah, only an hour after he appeared in a television interview in which he was highly critical of Arafat. This strife, which largely has taken place inside Arafat's Fatah faction, is closely linked to the worsening financial squeeze, say some Palestinians and outside officials.
PA infighting
Since the World Bank and donor countries have put increasing pressure on the Palestinian leadership to institute a system of direct deposits, less donor money has been accessible to Fatah.
"Much of the tensions we're seeing are caused by financial stress," says a Western diplomat in Jerusalem.
Walid Masri remembers the first day he saw the Palestinian police stream through the dusty streets of Jericho, past the refugee camp where he spent his childhood. "When the Palestinian police first came, we felt a kind of safety and security. We could go out at night," he recalls.
Now, a decade later, he thinks of himself as someone who doesn't live under any government at all. "There is no functioning authority now. The Israelis come in and out when they want someone. Everything has come to a halt," says Mr. Masri, a waiter at the Mount of Temptation restaurant and tourist stop in Jericho. Masri, a father of five, has had almost no work since the intifada started. A place that once bustled with Christian pilgrims, the restaurant and gift shops only reopened a few months ago. It remains eerily empty, part of a minimall tucked into a hillside below the cable cars meant to carry visitors to the mount where Jesus was tempted.
Masri's boss, Maha Abdelrazak, says she and her husband opened up again after a four-year hiatus. But they only receive one or two buses a day, compared to the 30 to 50 they used to get at the height of the tourist season, pre-intifada.
"We wish we had saved some of the money from those days. But we just put everything we earned back to into the restaurant and kept expanding. We never thought they would close the doors on tourists," says Mrs. Abdelrazak, a woman with an warm smile. The restaurant, even at lunch time in summer tourist season, has nary a customer. Only when a bus rolls in, she says, do they flick on the lights - turned off to save on energy bills.
The PA has not tried to collect taxes from them at least four years, and there are not many services she can point to that she receives from the government. Yet she wishes everyone were a bit more patient. "People want magic to happen. People think that as soon as the PA is in place, all their problems should be solved," she says. "But no one's perfect. Ten years is not a long time for a country, for a government to give the people what they want."
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Businessman Pardoned by President Clinton Sentenced in Tax Evasion Case
The Associated Press
Published: Sep 13, 2004
LOS ANGELES (AP) - A businessman once pardoned by former President Clinton was sentenced Monday to 18 months in prison for failing to pay millions of dollars in federal income tax.
Under a plea agreement, Almon Glenn Braswell admitted that his Marina del Rey-based mail-order vitamin business, Gero Vita International, did not pay $4.5 million in taxes.
U.S. District Judge Margaret Morrow said Braswell could have been sentenced to up to 41 months, but he cooperated with authorities in their case against Braswell's tax preparer, William E. Frantz, an Atlanta attorney.
However, Frantz eventually was acquitted of charges he helped Braswell avoid paying income taxes.
Braswell has paid $10.5 million in back taxes, interest and penalties, Morrow said during the sentencing hearing. He received credit for time already served in jail and will serve 10 months in prison.
Braswell, 61, has been jailed without bail since his January 2003 arrest in Miami.
Clinton granted 177 pardons and clemencies just before leaving office in 2001. Braswell was pardoned of convictions for fraud and other crimes stemming from false claims in 1983 about a baldness treatment.
His pardon became one of the most criticized after it was learned that Clinton's brother-in-law, Hugh Rodham, had been paid $200,000 to work on the case. Rodham later returned the money.
AP-ES-09-13-04 2202EDT

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Police still probing SMS: Downer
14sep04
FEDERAL police were still investigating whether Indonesian authorities had received an SMS warning prior to the Jakarta bombing, Foreign Minister Alexander Downer said today.
Prime Minister John Howard and Mr Downer both said last week Indonesian police received an SMS warning last Thursday morning that terrorists had threatened to attack a Western embassy if radical cleric Abu Bakar Bashir was not released from jail.
Suicide bombers attacked the Australian embassy 45 minutes later, killing 10 people and injuring more than 180.
But Australian Federal Police (AFP) Commissioner Mick Keelty yesterday said authorities had been unable to trace the SMS message.
Mr Downer said the AFP was less certain now than last week that an SMS had been sent.
"I think they are still looking into it," he said on Sydney radio 2UE.
"I don't think they are 100 per cent sure at this stage."
Mr Downer stood by the Government's decision to release details of the SMS warnings before it had been confirmed.
"We thought it was important to pass on information as it came to us and we still do think that," he said.
? Herald and Weekly Times
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Saudis deny British Ambassador's claim security men helped terrorists
by IMRA
An official source of the Ministry of Interior today denied the interpretation given by the British Ambassador to the Kingdom Sherard Coober-Coles who expressed belief during an interview with the BBC /Radio 4 on 23 Rajab 1425 H. corresponding to 7 September 2004 that Saudi security men might have helped some terrorists who stormed Alwaha residential complex in the city of Alkhober on 30 May 2004 to sneak off.
The official source said the interpretation of the British ambassador to the Kingdom of the developments of the incident of Alwaha residential complex in Alkhober reflects his own point of view which lacks evidence and does not comply in any way with the real fact which has been announced at the time with the utmost credibility and transparency as the security men have dealt with the matter according to the responsibilities and duties implied on them at the moment, among the priorities of which is the rescue of the residents of the facility which accommodates hundreds of people from different

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Muddled and Maddening
By Jagdish N. Bhagwati
Wall Street Journal, September 11, 2004
Now that his handlers want John Kerry to change weapons, in the midst of a presidential duel, from Iraq to the economic rapier, it's safe to say that they think this sets him up to inflict a fatal wound. That may well be so. Yet on trade policy, on which Howard Dean cut his teeth without gaining a cutting edge and Dick Gephardt made his last stand, one can only gasp at Sen. Kerry's gaffes.
How does one forgive him his pronouncements on outsourcing, and his strange silences on the Doha Round of multilateral trade negotiations? Indeed, Sen. Kerry, whose views and voting record were almost impeccable on trade, has allowed himself to be forced into such muddled and maddening positions on trade policy that, if one were an honest intellectual as against a party hack, one could only describe them as the voodoo economics of our time.
There seem to be three arguments by Sen. Kerry's advisers that have prompted this sorry situation for the Democrats: First, that the Bush trade policy is no better; second, that electoral strategy requires that Sen. Kerry act like a protectionist, while indicating subtly (to those that matter) a likelihood of freer trade in the White House; and third, at odds with the previous argument, that the U.S. does indeed have to turn trade policy around toward some sort of protectionism (and restraints on direct investment abroad) if it is going to assist workers and reward the unions. Each argument is flawed.
- Mr. Bush is no better. Yes, there are commonalities on trade in both parties, not just during the elections. They both espouse "free and fair trade." But, except for NGOs like Oxfam -- which profess trade expertise that they manifestly do not possess, and do great damage in consequence to poor nations -- every informed trade expert knows that when "fair trade" is invoked, it is code for (unfair) protectionism in the shape of anti-dumping actions against successful rivals, often from the developing nations.
Both parties, and both candidates, have backed actions against "unfair" trade. The 2004 Democratic platform promises that Sen. Kerry will create new jobs by fighting for "free, fair and balanced trade," whereas the White House Web site promises that "Free and fair trade helps create jobs by opening foreign markets to American exports." Both candidates ask for "level playing fields" or else tough retaliatory action -- pretending of course that the U.S. is on higher ground morally but on lower ground in the war for markets -- and that the other party is soft while it will act tough.

* * *

The truly disturbing sin of commission of the Kerry campaign, however, has been to surrender to the hysteria over "outsourcing." And he has made at least two howlers that would make my first-year students blush a shade of beetroot.
First, outsourcing fears have arisen over what economists call "long-distance," or arm's length, services -- which can be transmitted over "snail-mail" or over the Internet without the provider and user of services having to be in physical contact. Call-answer services operating in Manila instead of in Minneapolis; the reading of X-rays taken in Boston, via digital transmission, by radiologists in Bangalore; and tax filings prepared in Mumbai rather than in Manhattan, have produced a scare that service jobs will move offshore.
But all available estimates show that, so far, the offshore outsourcing of arm's length services has resulted in a loss of no more than 100,000 jobs annually. It is ludicrous to be alarmed by this minuscule number. One ought to face with equanimity a figure even tenfold, although the best estimates predict the annual flow over the next decade to double at worst. Nor should one forget that the U.S. itself benefits from others outsourcing to it in medical, legal, accounting, teaching and other high-value arm's-length services. The net effect on jobs due to such outsourcing is almost certainly a net gain for the U.S.
Second, Sen. Kerry has muddled matters by confusing the outsourcing of services with the altogether different issue of direct foreign (i.e. equity) investment by U.S. firms. Dell may outsource problem-solving calls to Bangalore but may buy those services from an Indian firm like Infosys: that is simply trade. But direct investment is different; it occurs typically when a firm in Nantucket closes shop and moves production to Nairobi.
Sen. Kerry went so far as to describe firms that invested abroad as "Benedict Arnolds." The silliness of this charge puts him in the same camp as Lou Dobbs, whose outpouring against sundry forms of imports and outward investment is a farrago of nonsense, offered by him with a list (on his CNN program) of traitor firms that "ship jobs abroad." As I contemplate his slip of a book titled "Exporting America," and subtitled "Why Corporate Greed is Shipping American Jobs Overseas," I think to myself: If firms that buy cheap abroad suffer from "corporate greed," is Mr. Dobbs -- whose girth and success doubtless suggest that he buys for his supper French brie and Burgundy rather than Milwaukee beer and Kraft cheese -- to be accused by the same logic of "shipping jobs abroad" because of "Personal Gluttony"? (What is sauce for the corporate goose must be sauce for the journalist gander.)

* The Doha Round. Sen. Kerry is also not good news for the critical multilateral trade negotiations in the Doha Round. Where President Bush has articulated strong support for it, Sen. Kerry has ducked the issue. Then again, on top of the strange commitment to have a 120-day review of existing trade agreements (which presumably include the WTO), the Kerry-Edwards demand that labor and environmental requirements be included, with sanctions, in old and new trade agreements, clearly aims a dagger at the heart of Doha.

For while little countries doing bilateral Free Trade Agreements with us will roll over and accept almost any conditions in exchange for preferential access to our huge market, this will simply not happen with the large developing countries that see, correctly, the protectionist hand of lobbies, including unions, behind the demands for labor and certain environmental requirements. There is no way that the mildly left-leaning India of Sonia Gandhi, and even the Brazil of Lula -- indisputably a more credible union man than any we produce -- will turn away from their longstanding objections and accept such restrictions, either in bilateral FTAs or at Doha. Has Sen. Kerry really thought this through? Also, a Kerry administration will have to cope with its protectionist and anti-trade constituencies which demand such restrictions, and with its own trade-unfriendly rhetoric. And if the Doha Round negotiations are to continue credibly through 2005, a President Kerry will face the problem of the expiry of fast-track authority extension beyond mid-year. It is hard to imagine how he will cope with this problem.

* Can Kerry Turn Free Trader? In the end, Sen. Kerry cannot totally jilt his constituencies. He will have to claw his way to freer trade, making him a greater hero in a war more bloody than Vietnam. The unions, in particular, are going to insist on their reward. This is forgotten by the many pro-trade policy advisers and op-ed columnists who argue privately that we should not worry -- because Sen. Kerry is a free trader who has merely mounted the protectionist Trojan Horse to get into the White House. The irony of this last position is that it is, in fact, too simplistic. Besides, it suggests that when President Bush does the same thing, he's lying, but that when Sen. Kerry does it, it's strategic behavior! Is it not better, instead, for us to tell Sen. Kerry that his trade policy positions are the pits -- before he digs himself deeper into a pit from which there is no dignified exit?
Mr. Bhagwati, University Professor at Columbia and Andre Meyer Senior Fellow at the Council on Foreign Relations, is the author of "In Defense of Globalization" (Oxford, 2004).

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Harmonizing Energies in Missile Defense
By Al Kamen
Monday, September 13, 2004; Page A19
Bureaucratic memos often stray far enough from basic English to be considered a distinct language. A wonderful example comes to us from Terry R. Little, acquisition management adviser at the Missile Defense Agency.
In a memo last month to "All Element Program Managers," Little wrote: "The Missile Defense Agency Director wants to capitalize on the extraordinarily hard work undertaken throughout the agency to develop and deliver Ballistic Missile Defense System (BMDS) capabilities. Our purpose is to realize the solidarity of your hard work, reduce the distractions and facilitate the commonality in our focus, and maximize the efficient utilization of MDA resources.
"The goal is to eliminate wasted energy and encourage harmonizing individual energies towards the common vision to develop and field an integrated BMDS capable of providing a layered defense for the homeland, deployed forces, friends, and allies against ballistic missiles of all ranges in all phases of flight.
"I am forming the BMDS Integration Working Group (IWG) to harmonize the separate element contracts into a coherent whole. The IWG will need to have insightful discussions, innovative coordinate actions, and a collegial environment to form and evaluate alternatives that reward integrated BMDS demonstrated capabilities."
Then, inexplicably, Little lapses into English. "To assist with the IWG's success, I need your support," he writes. But he says not to forget that "the timeline is very aggressive. I would like to have the harmonization path ahead. . . ."
Any more New Age harmony and we'll all assume the lotus position and start chanting.
Meanwhile, Little manages a program that used to be called the Boost Phase Intercept Program. Then it was determined that you would have to be really, really lucky to knock out enemy missiles in the boost or launch phase, so the name was changed to the Kinetic Energy Intercept program. But the program remained the same.
Though a Republican program, the KEI has had a rocky time on the Hill. The Republican Congress whacked its budget last year and this year cut an additional $163 million.
KEI put out a "Top Ten" list last month of the technical issues the program needed to resolve to stay on track, including such minor things as the booster for the rockets and the means of finding the target.
But it appears there are only nine items on the list. Maybe Congress cut the program because they felt KEI couldn't count?
Nonprofits Fear U.S. Logo Is a Bull's-Eye
A nasty battle is brewing between nonprofit international aid groups and the Agency for International Development. Seems AID is demanding that the groups put the AID logo on vehicles and projects when AID is paying most of the tab for the activities.
The foreign aid law, AID deputy chief Frederick Schieck said, requires that "programs shall be identified overseas" if taxpayers are paying. Aid recipients should know that the American people are providing this, he said.
But putting the AID logo on vehicles and projects these days, especially in Iraq and Afghanistan, is like pasting a bull's-eye on the pickup, the groups argue. With aid workers getting kidnapped and killed, the timing doesn't seem quite right.
Schieck said AID was "well aware" the organizations are "concerned, correctly," and "we're not trying to ram this down anyone's throat. . . . We're very sensitive to the security issue." For that reason, AID officials overseas, not in Washington, would have the authority to waive the requirement.
But, he noted, "taxpayer recognition is required by law" and making sure people know who is helping them is "important to the U.S. national interest." Schieck said a proposed regulation would go to the Federal Register in the next month or so.
The aid groups say it has been long-standing AID policy not to require a logo for grantee organizations, such as CARE, Save the Children or Catholic Relief Services. Those groups get money from various entities, not just AID -- as opposed to AID contractors, which are mostly private commercial firms.
"At a time when members of Congress are being told to keep a low profile overseas," said Bob Lloyd, a government relations liaison for the Association of Private Voluntary Organization Financial Managers, "AID apparently wants aid groups to hang a light on themselves."
And the security problem is not limited to a few places, Lloyd said. "Make a list of all the countries where there's been a terrorist incident -- Indonesia, Kenya, Jordan, the West Bank, Kyrgyzstan -- there's a ton of them."
Mistaken Identity
Program here! Get your program here! The tight coordination between Saddam Hussein and Osama bin Laden was so close that administration officials have trouble keeping the two apart.
Defense Secretary Donald H. Rumsfeld said last week that Ahmed Shah Massoud, the former Northern Alliance leader in Afghanistan, "lay dead, his murder ordered by Saddam Hussein, by Osama bin Laden, Taliban's co-conspirator." Actually, Hussein had nothing to do with that hit.
Later, Rumsfeld said: "Saddam Hussein, if he's alive, is spending a whale of a lot of time trying not to get caught. And we've not seen him on a video since 2001." He meant bin Laden.
Yup. Tighter than ticks, those two.
? 2004 The Washington Post Company

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>> HOW CHAVEZ FOOLED CARTER?


Court-Packing in Venezuela
By JOANNE MARINER
----
Monday, Jun. 21, 2004
In this country, decades ago, President Franklin D. Roosevelt once tried to remake the U.S. Supreme Court. Frustrated by court rulings that had struck down progressive social legislation, FDR proposed a bill that would have allowed him to name six new justices to the Court.
FDR's plan failed and his court-packing strategy was discredited. Although U.S. presidents subsequent to him have disagreed strongly with some of the Supreme Court's rulings, their ability to capture seats on the Court is limited. Rather than reconfiguring the Court in one fell swoop, they must proceed member by member, as justices die or leave voluntarily.
Yet, in practice if not in principle, the court-packing model survives. Especially in Latin America, a region whose judiciaries have historically been vulnerable to political pressure, heads of state have frequently tried - and succeeded - in remaking their country's top courts.
In the 1990s, the leading examples of this problem were Carlos Menem's Argentina and Alberto Fujimori's Peru. This year, it is Venezuela where judicial independence is under threat.
The Central Role of the Venezuelan Supreme Court in Settling Political Controversies
With an upcoming referendum on whether he should be recalled from office, Venezuelan President Hugo Chavez is in serious political difficulty. It will ultimately be the Venezuelan Supreme Court that decides any controversies stemming from the upcoming referendum, questions that could directly shape Chavez's political future.
It is the Court, for example, that recently ruled that if Chavez were to be ousted in the referendum, he could run again in the regularly scheduled presidential elections of 2006. But one question the Court has yet to decide is whether Chavez, if he loses the referendum, could run as a candidate in the interim elections that result. And this issue - whether Chavez could lose the referendum, yet run again and possibly remain in power - is enormously contested.
President Chavez's supporters, it should be noted, view the Venezuelan Supreme Court as a bastion of the political opposition. They cite, as proof of the Court's hostility to Chavez, an August 2002 ruling by the Court that cleared four military officers accused of taking part in a 2002 coup against Chavez. They also point out that the entire Venezuelan judiciary has been plagued for years by influence-peddling, political interference, and corruption.
Venezuela's New Court-Packing Law
The Venezuelan courts indeed require reform. But rather than take steps to strengthen judicial independence and protect the courts from political meddling, Ch?vez's allies have moved to rig the system to favor their own interests.
Last month, the pro-Chavez majority in the National Assembly took action to dramatically shift the Supreme Court's political balance. Under the terms of a new law, the Court will expand from twenty to thirty-two members, giving the Assembly's slim governing coalition the power to obtain an overwhelming majority of the Court's seats.
Under another provision of the new law, the National Assembly gave itself the power to "nullify" the appointments of justices who are already on the Court, using extremely subjective criteria. If, for example, a majority of the Assembly concludes that a justice's "public attitude . . . undermines the majesty or prestige of the Supreme Court," or of any of its members, that justice can be stripped of his or her post.
Not only does this new provision violate basic protections of judicial independence, it is also clearly inconsistent with Venezuela's own constitution. Its wording - "nullification" of an appointment, as opposed to impeachment of a justice -- cannot disguise the fact that the provision violates the constitutional requirement that justices be removed only via a two-thirds' majority vote of the National Assembly.
The net effect of the new law is, in short, to hand over control over the Supreme Court's composition to the National Assembly. With the Assembly now enjoying the power both to pack and purge the Court, the threat to judicial independence is clear.
Already, last week, pro-Chavez legislators have begun taking action under the law, voting to remove one justice from the Court and to initiate proceedings against others. The targets, unsurprisingly, were justices perceived as hostile to Chavez and his views.
"A Dangerous Precedent for the Future"
It was sixty-seven years ago this month that the Judiciary Committee of the U.S. Senate issued its scathing report on FDR's court-packing plan. The committee's report, made public on June 14, branded FDR's proposal "a needless, futile and utterly dangerous abandonment of constitutional principle . . . . [that] would subjugate the courts to the will of Congress and the President and thereby destroy the independence of the judiciary."
The court-packing plan, the report concluded, "violates all precedents in the history of our Government and would in itself be a dangerous precedent for the future."
Venezuela's court-packing plan is, unfortunately, far from unprecedented. But even though it follows a model found, most recently, in Argentina and Peru, it is still short-sighted, ill-conceived, and distressing.
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from the September 14, 2004 edition - http://www.csmonitor.com/2004/0914/p06s02-woeu.html
Russian terrorism prompts power grab
New measures announced yesterday would end direct election of governors in Russia's 89 regions.
By Fred Weir and Scott Peterson
MOSCOW - In the aftermath of a wave of terror attacks, President Vladimir Putin yesterday announced fundamental political changes that will further concentrate power in the Kremlin and erode Russia's fragile democracy.
Critics say the measures - couched as a strengthening of central government to combat terrorism - will do little to enhance public security, are aimed at broadening the Kremlin's grip on Russia's far-flung regions, and may ultimately weaken Mr. Putin's rule.
"Now it's absolutely clear, Putin wants to use this opportunity to destroy the last vestiges of Yeltsin-era democracy," says Alexander Golts, a national security expert with the weekly Yezhenedelny Zhurnal. "Instead of attacking terrorists, he's attacking our electoral system."
In an address yesterday, Putin said he would introduce a law to effectively end the direct election of governors in Russia's 89 regions. Instead, he said, Kremlin-nominated candidates would be "endorsed" by local legislatures. Further changes to the State Duma will eliminate local constituency races that currently fill half the Duma's 450 seats, in favor of electing the entire parliament by using centrally compiled national party lists.
"The organizers and perpetrators of the terror attacks are aiming at the disintegration of the state, the breakup of Russia," Putin said. "The fight against terrorism should become a national task."
The moves come as Russia reels from the Beslan school siege and other attacks, which killed more than 430 Russians in just three weeks. Bowing to public pressure, Putin on Friday approved an inquiry into the events of the hostage drama.
The political changes have long been circulating among Russia's political elite, says Liliya Shevtsova, a political analyst at the Carnegie Moscow Center, but their implementation has been "accelerated" by the Beslan tragedy.
"[Putin] apparently believes this is the most effective way of dealing with Russia's problems of terror and insecurity - it fits his ideology of authoritarian modernization," says Ms. Shevtsova.
But there is also a dangerous drawback, she says: "It undermines Putin's presidency because he will be responsible for all the mistakes of the sorry guys he has appointed. It undermines the system."
The pro-Kremlin United Russia Party enjoys a two-thirds majority in the Duma, already sufficient to initiate changes to the Constitution. Eliminating the often unpredictable local constituency contests will sharply reduce the number of independent deputies who find their way into the Duma, and strengthen the electoral hand of a few Moscow-based giants, chiefly the state-backed United Russia.
"People say Putin wants to create an American-style two-party system, which would increase stability in a huge and volatile country like Russia," says Sergei Strokan, a political expert who writes for the liberal daily Kommersant. "But the problem is that Russia lacks any developed, independent political parties. The state already dominates the political field."
Some experts argue that increased Kremlin authority, while curtailing democracy, might be necessary to fight Russia's endemic official laxity and corruption. "Increasing direct Kremlin control is a logical step dictated by the dangerous weakness of our state structures," says Vitaly Naumkin, director of the independent Center for Strategic and International Studies in Moscow. "Our state will become more authoritarian, but stronger. This will certainly be welcomed by the public."
But a five-minute call-in poll on the Ekho Moskvy radio station yesterday found a majority against one of Putin's major changes. Of 3,807 people who responded, 75 percent were for the direct election of regional governors.
Putin also proposed creating a new body, called the Public Chamber, not unlike the US Department of Homeland Security. "We need a single organization capable of not only dealing with terror attacks but also working to avert them, [to] destroy criminals in their hideouts and, if necessary, abroad," Putin said.
Some critics are concerned that security forces might interpret the task as reconstituting Stalin-era networks of informers. "The idea of a public watchdog organization sounds good in principle, but what kind of popular participation will it be?" asks Mr. Strokan. "If this job is handed to the bureaucrats, we will see the task of fighting terrorism mutate into total social control."
Since the Beslan tragedy, the Kremlin has been subject to unaccustomed questioning by Russians over the loss of life to terror. Only one week ago, Putin refused to conduct a public inquiry into the school siege, saying such a probe would be unproductive, and amount to nothing more than a "political show."
But on Friday - in an apparent rare step of accountability - Putin approved an inquiry, though it will be led by a Putin loyalist.
"This is not a response to terrorism," says Andrei Kolesnikov, a political observer with the Rossiskaya Gazeta newspaper. "They have been looking for some pretext to carry out their long-thought-over plans. Other steps might follow to justify three presidential terms. The purpose is to make [Putin's] 'vertical power' more vertical still."

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$3 Trillion Price Tag Left Out As Bush Details His Agenda
By Mike Allen, Washington Post Staff Writer
The expansive agenda President Bush (news - web sites) laid out at the Republican National Convention was missing a price tag, but administration figures show the total is likely to be well in excess of $3 trillion over a decade.
A staple of Bush's stump speech is his claim that his Democratic challenger, John F. Kerry, has proposed $2 trillion in long-term spending, a figure the Massachusetts senator's campaign calls exaggerated. But the cost of the new tax breaks and spending outlined by Bush at the GOP convention far eclipses that of the Kerry plan.
Bush's pledge to make permanent his tax cuts, which are set to expire at the end of 2010 or before, would reduce government revenue by about $1 trillion over 10 years, according to administration estimates. His proposed changes in Social Security (news - web sites) to allow younger workers to invest part of their payroll taxes in stocks and bonds could cost the government $2 trillion over the coming decade, according to the calculations of independent domestic policy experts.
And Bush's agenda has many costs the administration has not publicly estimated. For instance, Bush said in his speech that he would continue to try to stabilize Iraq (news - web sites) and wage war on terrorism. The war in Iraq alone costs $4 billion a month, but the president's annual budget does not reflect that cost.
Bush's platform highlights the challenge for both presidential candidates in trying to lure voters with attractive government initiatives at a time of mounting budget deficits. This year's federal budget deficit will reach a record $422 billion, and the government is expected to accumulate $2.3 trillion in new debt over the next 10 years, the nonpartisan Congressional Budget Office (news - web sites) reported last week.
The president has had little to say about the deficit as he barnstorms across the country, which has prompted Democrats and some conservative groups to say Bush refuses to admit that there won't be enough money in government coffers to pay for many of his plans.
Although a majority of voters say they are concerned about the deficit, most view Kerry as only marginally better able to deal with it than Bush, according to polls. And Bush often invokes the Sept. 11, 2001, terrorist attacks in justifying the mounting governmental red ink. The president's aides, ever cognizant of his father's failure to articulate a convincing vision, said it was crucial for Bush to offer an ambitious new plan for the coming four years, despite the surge in government borrowing.
Bush-Cheney campaign spokesman Steve Schmidt said the new proposals "are affordable, and the president remains committed to cutting the budget deficit in half over the next five years," although last week's CBO report indicates that goal may not be attainable.
The White House has declined to provide a full and detailed accounting of the cost of the new agenda. The administration on Thursday provided a partial listing of the proposals, including $74 billion in spending on "opportunity zones" over the next 10 years. But there was no mention of the cost of additional tax cuts and the creation of Social Security private accounts. Discussing his agenda during an "Ask the President" campaign forum in Portsmouth, Ohio, Bush said Friday that he has "explained how we're going to pay for it, and my opponent can't explain it because he doesn't want to tell you he's going to have to tax you."
Some fiscal conservatives who are dismayed by the return of budget deficits found little to cheer in the president's convention speech. Stephen Moore, president of the conservative Club for Growth, said that Bush's Social Security plan was money well spent by saving the system in the long run, but he added that Bush "has banked his presidency on the idea that people don't really care about the deficit, and he may be right."
"He's a big-government Republican, and there's no longer even the pretense that he's for smaller government," Moore said.
Kerry cited the deficit figures as fresh evidence that Bush's tax cuts were reckless and that he is taking the country in "the wrong direction." Private analysts expect the deficit to be even deeper because the White House has not accounted for the cost of continuing operations in Iraq and Afghanistan (news - web sites).
The administration has been secretive about the cost of the war and the likely impact that the bulging defense budget and continuing cost of tax cuts will have on domestic spending next year. The White House put government agencies on notice this month that if President Bush is reelected, his budget for 2006 may include $2.3 billion in spending cuts from virtually all domestic programs that are not mandated by law, including education, homeland security and others central to Bush's campaign.
But Bush has had little to say about belt-tightening and sacrifice on the campaign trail. Nor has he explained how he would reconcile all his new spending plans with the mounting deficit.
"The Bush team has gotten a lot of traction with the point that the Kerry numbers and rhetoric don't add up," said Kevin A. Hassett, director of economic policy studies at the conservative American Enterprise Institute. "It behooves them now to demonstrate that theirs do."
In his acceptance speech in Madison Square Garden on Sept. 2, the president also called for the expansion of health savings accounts, which provide tax breaks for families and small businesses; creation of new tax-preferred retirement savings accounts; and creation of lifetime savings accounts, which allow tax-free savings for tuition, retirement or even everyday expenses.
The "Agenda for America" also includes increasing testing and accountability measures for high schools and opportunity zones to cut regulations and steer federal grants, loans and other aid to counties that have lost manufacturing and textile jobs -- a clear appeal to swing states such as Michigan, Ohio, Pennsylvania and West Virginia.
Bush has also promised to "ensure every poor county in America has a community or rural health center" and "double the number of people served by our principal job training program and increase funding for our community colleges."
Jason Furman, Kerry's economic policy director, said that Bush "wants to hide the true costs of his plan" and that taxpayers "would be shocked" to find out what he was really advocating.
An estimate from the Social Security actuary's office, included in the 2001 report of a Social Security commission appointed by Bush, put the cost of adding private accounts to the government retirement program at $1.5 trillion over 10 years. With inflation, the figure would now be about $2 trillion. Much of the expense comes from continuing to pay most retirees at current benefit levels, at the same time that some payroll taxes are being diverted to the stock and bond market.
Although advocates of partial privatization contend that the transition can be financed without cutting benefits or raising taxes, the estimates mean the president's agenda could cost even more than the Bush projections of Kerry's proposal. Hassett, the AEI economist, said private accounts would lower the long-term cost of Social Security. "If you pay a few trillion in transition costs over a decade, then maybe the system doesn't go bankrupt," he said.
Bush also called for making his tax cuts permanent, which the administration has estimated at $936.2 billion to $989.75 billion over 10 years. The tax cuts include elimination of the inheritance tax, reductions in the top four income tax rates, an increase in the child tax credit, reduction in the marriage penalty, and cuts to the capital gains and dividend tax rates.
Robert Greenstein of the liberal Center on Budget and Policy Priorities put the figure for extending the tax cuts at $2 trillion over 10 years and said other tax breaks Bush mentioned in his speech -- mostly related to health care -- would likely cost $50 billion to $100 billion over the next decade., The third most expensive part of the agenda is Bush's call for the expansion of health savings accounts and creation of lifetime and retirement savings accounts. The new accounts are designed to have minimal cost in the first 10 years but have very large costs in the long run because they provide tax breaks when the money is withdrawn rather than up front.
The Congressional Research Service has estimated those two types of accounts would eventually cost $30 billion to $50 billion a year.
Peter R. Orszag, a senior fellow in economic policy at the Brookings Institution, said a conservative estimate for the cost of Bush's permanent tax cuts and Social Security accounts would be about $4 trillion over 10 years. But Bush's agenda was vague and did not include details of how he would add Social Security accounts.
"It's hard to cost out rhetoric," Orszag said.

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Posted by maximpost at 11:26 PM EDT
Permalink
Wednesday, 8 September 2004

>> ISRAEL


Loss of Ofek-6 Deprives Israel of Second Spy Satellite in Critical Period
DEBKAfile Special Report and Military Analysis
September 7, 2004, 12:07 AM (GMT+02:00)
Ofek-6 did not join Ofek-5 up above.
Israel's 6th Ofek (Horizon) plummeted to a watery death in the Mediterranean Sea when it was test-fired Monday, September 6, from Palmahim. Malfunction of the third stage of the Israeli-designed Shavit booster was blamed for the loss of the $50m Ofek-6, the latest in the series of spy satellites developed by a consortium led by Israel Aircraft Industries. The first was launched in 1988. Number 5 has been orbiting 300 to 700 kilometers above earth every 90 minutes for two years out of a life span of five.
Satellites are the first layer of Israel's shield against ballistic missiles, designed to spot incoming threats and alert defensive systems such as the Arrow II missile-killer. They are launched by the same Shavit rocket system as the Ofek. The latest malfunction occurred ten days after Arrow II failed to shoot down a dummy missile designed to perform similarly to the Iranian Shehab-3 intermediate missile in a test-firing off the California coast. The missile's 1300-km range covers all of Israel as well as Turkey and Saudi Arabia.
These two failures are a grave setback to Israel's deterrent ability at a dangerous juncture. In the next two-three years, Israel will need all its resources to face Iran's advancing nuclear threat and burgeoning terrorist offensive. Ofek-6 was intended to give Israel an edge in this contest in three fields:
1. The use of two advanced surveillance satellites instead of one to simultaneously track the two fronts, nuclear and terrorist, Tehran has opened against Israel. One is a nuclear threat, from sites scattered across the Islamic republic; the second derives from proliferating terrorist bases spread out from Iran, Iraq and Syria to Lebanon (app. 879,730 square miles).
Together, the two satellites would have doubled the chances of spotting hostile movements.
The inadequacy of a single satellite in orbit became manifest in the past year when Iran clandestinely fanned its 15 known nuclear installations out across the country, over an area of 636,000 square miles. DEBKAfile's military sources reveal some of their locations for the first time.
They are located in the south, at Fasa, Bushehr and Dakhovin, at the tip of the Shatt al-Arb waterway;
In central Iran, at Natanz, Saghand, Tabas, which is close to the Afghan border, Chalus and Neka on the southern shore of the Caspian Sea;
In the north, at Bonab and Tabriz.
The most remote sites have been sunk below ground in enormous bunkers, some of them decoys to deceive watchers in the sky.
Ofek-5, however efficient it may cannot alone cover this vast spread in time of war. On August 11, it joined the packs of American and Russian satellites tracking the Shehab-3 test firing. The Iranian missile's new navigating system, smaller fins and improved warhead for entry to the earth's atmosphere, designed for greater aerodynamic flexibility and longer range, was not an unmixed success. However, Ofek-5 without a partner was found to be incapable of gathering all the data Israeli intelligence needed to fully appreciate the intentions of Iran's military leaders. This lack of a second satellite will be felt even more acutely when the Shehab-5, whose range is believed to be 2,500 km, comes to be tested soon.
2. There are intelligence reports that as part of its nuclear weapons program, Iran is also building a range of military satellites for launching by Shehab-5. Israel cannot afford to have a lone satellite cruising in the sky in 2005 or 2006 once the Iranians have placed theirs in orbit. From the military standpoint, Israeli is bound to assert space and missile - as well as nuclear - superiority over its enemies.
And another factor to be considered is this. Not only does Israel keep track of Iran's weapons trials, Tehran is watching Israel just as closely.
Although their intelligence technology and access to US and Israeli testing sites are limited, the Iranians do not miss a single report on the deficiencies of the Arrow II and Ofek-6 and must have taken detailed stock of the holes in Israel's defensive and intelligence shields.
3. Israel is obliged to guarantee its intelligence gathering ability in real time independently of US intelligence. The intelligence ties between Washington and Israel are extremely close but neither party is under any illusion that sharing is or can be total. For instance, the United States made a point of keeping Israel in the dark during its March 2003 invasion of Iraq.
In his war book, American Soldier, the Iraq and Afghanistan war commander, General Tommy Franks, admits frankly that he always found ways of indicating to his Arab and Muslim hosts on whose side he stood in the Israel-Arab conflict.
Mutual trust between the Americans and Israelis is certainly not enhanced by the almost daily "revelations" in the American media of fresh aspects of the alleged Israeli mole case casting Israeli diplomats and members of the pro-Israel lobby AIPAC in a dubious light. Officials in Jerusalem are certain that someone in US intelligence, past or present, is deliberately pumping these "revelations" to the press to keep the affair and the atmosphere of mutual suspicion alive.
Israeli defense and aviation industry chiefs are doing their best to play down the consecutive failures of the Arrow II and the Ofek-6 as mere technical glitches that will soon be cleared up. But they cannot hide the fact that Iran is racing forward at top speed with its development of a nuclear weapon and the means to deliver, while Israel is held back with only one eye in the sky and concern about the Arrow's ability to intercept an incoming Iranian Shehab.
Both these deficiencies are within the power of Israel's defense and aviation establishment to correct if they pull their socks up.










European Marksmen-for-Hire in Gaza
DEBKAfile Exclusive Report
September 8, 2004, 12:04 PM (GMT+02:00)
The pair talked as they walked, indicating sandbanks until they reached a point 500 meters from his perch atop an IDF position. They then turned back and disappeared behind Palestinian houses.
M. decided this break in Palestinian routine was worth reporting to his superior officer, which he did and put the incident out of his mind.
Around 90 minutes later, he stood up to move to another part of the roof. His right shoulder had been visible over the parapet no more than three or four seconds when he was knocked over by a gunshot before he had time to fire. Another soldier on the roof shot back at once, but the sniper was gone.
In the hospital, M was shown the bullet extracted from his shoulder. It came from an M16 automatic rifle and had been fired from a distance of 500 meters, exactly the point where the pair had turned back from the sandbank opposite M.'s rooftop sights. His comrade told him he had caught a glimpse of the shooter he missed and was sure he was European. "A sniper fast enough to lock onto my shoulder, shoot and disappear - all in the space of a three or four seconds must be a top-line professional marksman," said M.
His account has been repeated by members of other units serving in the Rafah and Khan Younes sectors of the southern Gaza Strip. They swear they have come across snipers they are sure are not Palestinian but foreigners from northern parts of the world.
DEBKAfile's military sources report that in 2003, the IDF confirmed four instances of "foreign" snipers operating in Palestinian ranks. By September, 5 incidents had been registered this year. In one, an Israel soldier died of a direct shot to the head; four were injured in Operation Rainbow in Rafah earlier this year and two more recently. Soldiers serving in the southern sector claim the number of casualties from European snipers is much higher and are asking questions. Their officers reply that the matter is extremely sensitive but urge them to take precautions on the assumption that professional marksmen are in the vicinity.
Some troops say they have heard the special bang peculiar to the Russian-made SVD sharpshooter's rifle, of the type captured aboard the Karin-A Palestinian smugglers' ship and found during Operation Rainbow. The troops who have come up against these foreigners note their exceptional speed. They fire a single round and duck out of sight, leaving a Palestinian to take over their firing position.
This description, according to DEBKAfile's military sources, fits mercenary marksmen. By firing once and moving out, they save themselves from Israeli sniper reprisals. As one Israeli officer put it, "After all they're in it for the money, not to get killed." For that reason too, they never stay long in the Gaza Strip - a couple of days and they are gone back across the border into Egypt. Some are thought to enter through the Palestinian gunrunning tunnels from Sinai to Rafah and leave by the same route. Others may be smuggled in from Sinai to southern Israel in groups of illegal workers and prostitutes. The smugglers are said to receive extra-high pay, as much as $1,000, for bringing a foreign marksman in and out of the Gaza Strip.
Palestinian terrorist chiefs have been importing marksmen for hire to hit Israeli troops for two or more years. In March 2002, the London Daily Telegraph, known for its good British MoD and intelligence sources, reported a request from the Israeli Mossad to the British MI6 to find out if an IRA sharpshooter had not been responsible for the 7 Israeli troop deaths at the Wadi Harmiya checkpoint. Israeli tests had shown that the planning of the ambush, the type of weapons used, the way the firefight was managed and, even more tellingly, the fact that the weapons left behind were not the ones used, were typical of an assailant thoroughly conversant with IRA tactics.
One month later, when the Moshav Adura was stormed by Palestinian gunmen, Israeli civilians who had seen the terrorists at close quarters reported that among the Palestinians was a European.

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>> NORTH KOREA




43 Pro-N. Korean Websites on Internet
It has been revealed that there are 43 pro-North Korean websites on the Internet. Choi Ki-moon, the commissioner general of the National Police Agency (NPA), revealed this during an administrative committee meeting while responding to a question by GNP lawmaker Park Chan-sook, who asked, "How many pro-North Korean websites have the police detected on the Internet?"
According to the "Report on Overseas pro-North Korean Websites" separately submitted to Park by the NPA, there were 40 pro-North Korean internet sites as of the end of August, such as "Mt. Baekdu," "Minjok Tongsin," "Songun Politics Study Group," "Road to Patriotism," "The National Democratic Front South Korea (NDFSK)," "Juche (Self-Reliance) Ideology," and "Pyongyang Information Center." Park said, "According to the report, there were 40 sites at the end of August. Another three have recently been added, said Choi, so there were now 43 sites." The most number of these sites, 17, were opened in Japan, followed by the U.S. with 11, China with 10 and Singapore and Germany with one each.
In response to another question by Park, "Do the police have any measures against the North's Internet terrorism?" Choi said, "Most of those sites are based overseas, but we are fully investigating some of them." Also, when Park asked, "Are you carrying out an investigation into the incident in which the life stories of Kim Il-sung family were posted on the homepage of the People's Solidarity?" he answered, "We confirmed that three illegal documents were posted on the site, and they were emailed. So, we asked the Information Ministry to delete them and are investigating how they were posted."
The police said that they arrested two National Security Law offenders this year for using pro-North Korean sites. A 34-year-old man was arrested in March for posting 16 illegal documents on the Hanchongryon caf? operated by the internet portal company Daum, including, "Our Guiding Sun, General Kim Jong-il" posted on the homepage of NDFSK. In June, another 52-year-old man was arrested for posting 74 illegal materials on 10 private and group homepages, including "The General's World," posted on NDFSK.
(Yoon Jeong-ho, jhyoon@chosun.com )




Kim Jong-il's Sister-in-Law Defected to United States: Tokyo Shimbun
Japan's Tokyo Shimbun, quoting several sources, reported Wednesday that North Korean leader Kim Jong-il's sister-in-law, Ko Young-suk, defected to the U.S. in October 2001 and was currently receiving special protection.
Ko Young-suk is the younger sister of Ko Young-hee, Kim Jong-il's wife who is believed to have recently died. Ko Young-suk was arrested as she tried to enter the U.S. on a fake Japanese passport, and she applied for political asylum, the Japanese paper reported. The paper also reported that she is receiving special protection somewhere in the United States, and she appears to have provided intelligence to the U.S. concerning Kim Jong-il that she learned through her elder sister and about internal conditions in North Korea.
The Tokyo Shimbun said that according to the Monthly Chosun, the 46-year-old Ko looked after Kim's sons Kim Jong-chul and Kim Jong-woon when they were in Switzerland, and it's very likely that she knows about the characters of the two brothers and their property abroad.
This would not be the first time an in-law of Kim Jong-il has defected; the sister of Kim's first wife, Seong Hye-rim, also defected to a third country.
(englishnews@chosun.com )




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French connection armed Saddam
By Bill Gertz
THE WASHINGTON TIMES
The United States stood by for years as supposed allies helped its enemies obtain the world's most dangerous weapons, reveals Bill Gertz, defense and national security reporter for The Washington Times, in the new book "Treachery" (Crown Forum). In this excerpt, he details France's persistence in arming Saddam Hussein.
New intelligence revealing how long France continued to supply and arm Saddam Hussein's regime infuriated U.S. officials as the nation prepared for military action against Iraq.
The intelligence reports showing French assistance to Saddam ongoing in the late winter of 2002 helped explain why France refused to deal harshly with Iraq and blocked U.S. moves at the United Nations.
"No wonder the French are opposing us," one U.S. intelligence official remarked after illegal sales to Iraq of military and dual-use parts, originating in France, were discovered early last year before the war began.
That official was careful to stipulate that intelligence reports did not indicate whether the French government had sanctioned or knew about the parts transfers. The French company at the beginning of the pipeline remained unidentified in the reports.
France's government tightly controls its aerospace and defense firms, however, so it would be difficult to believe that the illegal transfers of equipment parts took place without the knowledge of at least some government officials.
Iraq's Mirage F-1 fighter jets were made by France's Dassault Aviation. Its Gazelle attack helicopters were made by Aerospatiale, which became part of a consortium of European defense companies.
"It is well-known that the Iraqis use front companies to try to obtain a number of prohibited items," a senior Bush administration official said before the war, refusing to discuss Iraq's purchase of French warplane and helicopter parts.
The State Department confirmed intelligence indicating the French had given support to Iraq's military.
"U.N. sanctions prohibit the transfer to Iraq of arms and materiel of all types, including military aircraft and spare parts," State Department spokeswoman Jo-Anne Prokopowicz said. "We take illicit transfers to Iraq very seriously and work closely with our allies to prevent Iraq from acquiring sensitive equipment."
Sen. Ted Stevens, Alaska Republican and chairman of the Senate Appropriations Committee, declared that France's selling of military equipment to Iraq was "international treason" as well as a violation of a U.N. resolution.
"As a pilot and a former war pilot, this disturbs me greatly that the French would allow in any way parts for the Mirage to be exported so the Iraqis could continue to use those planes," Stevens said.
"The French, unfortunately, are becoming less trustworthy than the Russians," said Rep. Curt Weldon, Pennsylvania Republican and vice chairman of the House Armed Services Committee. "It's outrageous they would allow technology to support the jets of Saddam Hussein to be transferred."
The U.S. military was about to go to war with Iraq, and thanks to the French, the Iraqi air force had become more dangerous.

The pipeline
French aid to Iraq goes back decades and includes transfers of advanced conventional arms and components for weapons of mass destruction.
The central figure in these weapons ties is French President Jacques Chirac. His relationship with Saddam dates to 1975, when, as prime minister, the French politician rolled out the red carpet when the Iraqi strongman visited Paris.
"I welcome you as my personal friend," Chirac told Saddam, then vice president of Iraq.
The French put Saddam up at the Hotel Marigny, an annex to the presidential palace, and gave him the trappings of a head of state. The French wanted Iraqi oil, and by establishing this friendship, Chirac would help France replace the Soviet Union as Iraq's leading supplier of weapons and military goods.
In fact, Chirac helped sell Saddam the two nuclear reactors that started Baghdad on the path to nuclear weapons capability.
France's corrupt dealings with Saddam flourished throughout the 1990s, despite the strict arms embargo against Iraq imposed by the United Nations after the Persian Gulf war.
By 2000, France had become Iraq's largest supplier of military and dual-use equipment, according to a senior member of Congress who declined to be identified.
Saddam developed networks for illegal supplies to get around the U.N. arms embargo and achieve a military buildup in the years before U.S. forces launched a second assault on Iraq.
One spare-parts pipeline flowed from a French company to Al Tamoor Trading Co. in the United Arab Emirates. Tamoor then sent the parts by truck through Turkey, and into Iraq. The Iraqis obtained spare parts for their French-made Mirage F-1 jets and Gazelle attack helicopters through this pipeline.

A huge debt
U.S. intelligence would not discover the pipeline until the eve of war last year; sensitive intelligence indicated that parts had been smuggled to Iraq as recently as that January.
"A thriving gray-arms market and porous borders have allowed Baghdad to acquire smaller arms and components for larger arms, such as spare parts for aircraft, air-defense systems and armored vehicles," the CIA said in a report to Congress made public that month.
U.S. intelligence agencies later came under fire over questions about prewar estimates of Iraq's stockpiles of weapons of mass destruction. But intelligence on Iraq's hidden procurement networks was confirmed.
An initial accounting by the Pentagon in the months after the fall of Baghdad revealed that Saddam covertly acquired between 650,000 and 1 million tons of conventional weapons from foreign sources. The main suppliers were Russia, China and France.
By contrast, the U.S. arsenal is between 1.6 million and 1.8 million tons.
As of last year, Iraq owed France an estimated $4 billion for arms and infrastructure projects, according to French government estimates. U.S. officials thought this massive debt was one reason France opposed a military operation to oust Saddam.
The fact that illegal deals continued even as war loomed indicated France viewed Saddam's regime as a future source of income.

Telltale chemical
Just days before U.S. and coalition forces launched their military campaign against Iraq, more evidence of French treachery emerged.
In mid-March 2003, U.S. intelligence and defense officials confirmed that exporters in France had conspired with China to provide Iraq with chemicals used in making solid fuel for long-range missiles. The sanctions-busting operation occurred in August 2002, the U.S. National Security Agency discovered through electronic intercepts.
The chemical transferred to Iraq was a transparent liquid rubber called hydroxy terminated polybutadiene, or HTPB, according to intelligence reports.
U.S. intelligence traced the sale to China's Qilu Chemicals, "the largest manufacturer of HTPB in China," one official says.
A French company, CIS Paris, helped broker the sale of 20 tons of HTPB, a controlled export that was shipped from China to the Syrian port of Tartus. The chemical solution was sent by truck from Syria into Iraq, to a missile-manufacturing plant. The Iraqi company that purchased the shipment was in charge of making solid fuel for long-range missiles.
HTPB technically is a dual-use chemical, because it also can be used for commercial purposes such as space launches. However, Iraq often disguised military purchases as commercial ones, as documents found later in Iraq would confirm.
In a report to Congress, the CIA said Iraq had constructed two "mixing" buildings for solid-propellant fuels at a plant known as al-Mamoun. The facility originally was built to produce the Badr-2000, a solid-propellant missile also known as the Condor.
The new buildings "appear especially suited to house large, U.N.-prohibited mixers of the type acquired for the Badr-2000 program," the CIA report stated.

French denials
Despite controversy over prewar intelligence on Iraq, the CIA said its estimates of Iraqi missiles were on target.
Representatives of the French and Chinese governments went on the attack when The Washington Times asked about the chemical sale.
Chinese Embassy spokesman Xie Feng did not address the specifics, but said "irresponsible accusations" about China's exports had been made in the past.
"These accusations are devoid of all foundation," French Foreign Ministry spokesman Francois Rivasseau declared. "In line with the rules currently in force, France has neither delivered, nor authorized, the delivery of such materials, either directly or indirectly."
By that point, many in the U.S. government were fed up with French denials.
Deputy Defense Secretary Paul Wolfowitz called in the French ambassador to the United States, Jean-David Levitte, to complain about France's covert and overt support for Saddam's regime.
"Twelve years of waiting was too costly in terms of the growing threat from Baghdad," Wolfowitz told the ambassador, according to a U.S. official who was present.

Made in France
The war in Iraq, which began March 19, 2003, provided disturbing evidence that France's treacherous dealings come at a steep cost to the United States.
On April 8 came the downing of Air Force Maj. Jim Ewald's A-10 Thunderbolt fighter over Baghdad and the discovery that it was a French-made Roland missile that brought down the American pilot and destroyed a $13 million aircraft. Ewald, one of the first U.S. pilots shot down in the war, was rescued by members of the Army's 54th Engineer Battalion who saw him parachute to earth not far from the wreckage.
Army intelligence concluded that the French had sold the missile to the Iraqis within the past year, despite French denials.
A week after Ewald's A-10 was downed, an Army team searching Iraqi weapons depots at the Baghdad airport discovered caches of French-made missiles. One anti-aircraft missile, among a cache of 51 Roland-2s from a French-German manufacturing partnership, bore a label indicating that the batch was produced just months earlier.
In May, Army intelligence found a stack of blank French passports in an Iraqi ministry, confirming what U.S. intelligence already had determined: The French had helped Iraqi war criminals escape from coalition forces -- and therefore justice.
Then, there were French-made trucks and radios and the deadly grenade launchers, known as RPGs, with French-made night sights. Saddam loyalists used them to kill American soldiers long after the toppling of the dictator's regime.
The intelligence team sent to find Iraqi weapons also discovered documents outlining covert Iraqi weapons procurement leading up to the war. The CIA, however, refused to make public the documents on assistance provided by France or by other so-called allies of the United States.
The clandestine arms-procurement network, disclosed late last year by the Los Angeles Times, put a Syrian trading company in a pivotal role. Documents showed the company, SES International Corp., was the conduit for millions of dollars' worth of weapons purchased internationally, including from France. Al Bashair Trading Co. in Baghdad was the major front used by Saddam to buy arms abroad.
A Defense Department-sponsored report produced in February identified France as one of the top three suppliers of Iraq's conventional arms, after Russia and China. The report revealed that France supplied 12 types of armaments and a total of 115,005 pieces.
A major reason Iraqi militants posed a threat to U.S. forces for so many months was that they had access to weapons that Saddam stockpiled in violation of U.N. resolutions.

A close call
One of the most frightening examples of how the militants put French weapons to use against the Americans came Oct. 26, 2003. That morning, at about 6 o'clock, they bombarded the Rashid Hotel in Baghdad with French missiles.
The French rockets nearly killed Wolfowitz, whom Defense Secretary Donald H. Rumsfeld has called "the brains" of the Pentagon.
The deputy defense secretary had just gotten dressed in his room that Sunday morning when a car stopped several hundred yards from the hotel. It dropped off what appeared to be one of the blue electrical generators that were common in the power-starved Iraqi capital. The driver stayed just long enough to open a panel on the end of the metal box that was pointing upward toward the hotel.
The car sped off. Minutes later, a pod of 40 artillery rockets set off by remote control began firing at the hotel, their trails leaving sparks as they flew. The rockets hit one floor below where Wolfowitz and about a dozen aides and reporters were staying.
One rocket slammed into the room of Army Lt. Col. Charles H. Buehring, a public-affairs officer. The explosion hit Buehring, 40, in the head. A reporter discovered him and tried to help, but the Fayetteville, N.C., resident died a short time later.
In all, between eight and 10 missiles hit the hotel. The casualties might have been higher, and included Wolfowitz, if the improvised rocket launcher had fired all the missiles.
Because of a malfunction, 11 failed to go off.

Playing defense
Half the missiles fired at Wolfowitz's hotel were French-made Matra SNEB 68-millimeter rockets, with a range of two to three miles. The others were Russian in origin.
The French missiles were "pristine," Navy SEAL commandos reported.
"They were either new or kept in very good condition," said one SEAL who inspected the rocket tubes.
The rockets were thought to have been taken from Iraq's French-made Alouette or Gazelle attack helicopters.
The fact that new French missiles were showing up in the hands of Saddam loyalists months after the fall of Baghdad made Wolfowitz and his close aides livid. Still, others in the U.S. government worked to defend the French.
The CIA, to avoid upsetting ties with French intelligence, played down the French role in helping Saddam. The agency had a weak human intelligence?gathering capability, and France, because of its history of ties to Iraq, was much better at penetrating Saddam's regime.
The State Department's response was not surprising. Asked about French support for Iraq while on a fence-mending mission to Paris in May 2003, Secretary of State Colin L. Powell had said: "We're not going to paper over it and pretend it didn't occur. It did occur. But we're going to work through that."
Powell, the retired four-star general and former chairman of the Joint Chiefs of Staff, was too inexperienced in the ways of diplomacy. As a result, he largely had turned over control of State Department policy-making to the Foreign Service.
The problem with the Foreign Service is its culture. It trains diplomats to "get along" with the foreign governments they are sent to work with. Not insignificantly, Paris is among the most coveted postings in the world.

Backing down
Pentagon hard-liners on France, led by Rumsfeld and Wolfowitz, carried the day early in the war, but accommodationists within the upper councils of the Bush administration took control as the conflict went on.
Among those who took a softer position on France was National Security Adviser Condoleezza Rice, the former Stanford provost who surrounded herself with State Department officials and Foreign Service officers.
Rumsfeld drew a great deal of attention on Jan. 22, 2003 -- and created a backlash within the State Department -- when he let fly a verbal salvo against France and Germany for not siding with the United States, describing them as "old Europe" during a meeting with foreign reporters.
Rumsfeld also criticized French and German political leaders for making policy based not on "their honest conviction as to what their country ought to do" but on opinion polls that reflected ever-shifting public sentiments.
As the accommodationists in the Bush administration gained the upper hand, Rumsfeld and others were ordered to tone down the anti-Europe rhetoric. By late last year, the defense secretary's critics within the Foreign Service were crowing that Rumsfeld had been "tamed."
Just a day after the Iraqi attack on Wolfowitz's hotel in Baghdad, in an interview with The Washington Times, Rumsfeld took an even softer approach toward the French.
"People tend to look at what's taking place today and opine that it is something distinctive," Rumsfeld said of the turbulence in Franco-American relations. "I don't find it distinctive. I find it an old record that gets replayed about every five or seven years."
The public soft-policy line was, in many ways, a great victory for France. Even as new evidence poured in that the French had betrayed the United States and cost the lives of American troops, the government backed down from a confrontation with its erstwhile ally.

Purchase this book Online at Barnes and Noble
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Iraq Shipped Banned Missile Engines Out of Country Shortly After War, UNMOVIC Says
The Iraqi Ministry of Trade began shipping scrap metal, including missile engines and equipment that could be used in WMD production, to Jordan and other countries less than three months after the United States and its allies overthrew former President Saddam Hussein, according to a report released yesterday by the U.N. Monitoring, Verification and Inspection Commission (see GSN, June 10).
The report, expected to be presented today to the U.N. Security Council, criticizes "the systematic removal" of items subject to U.N. monitoring from a number of Iraqi sites, the Associated Press reported.
Exported items include at least 42 engines from missiles with ranges that exceeded the 150-kilometer limit imposed by the United Nations following the 1991 Gulf War, according to AP.
Several Iraqi sites once used to manufacture missiles and precursors for chemical weapons have been destroyed or emptied, according to commercial satellite photographs.
Scrap yard managers estimated that 60,000 tons of scrap metal, stainless steel and other alloys passed through Jordan's largest free trade zone in 2003, followed by an additional 70,000 until June of this year, the report says. U.N. inspectors learned that was "only a small part of all scrap materials exported from Iraq to the other countries that border Iraq and further to Europe, North Africa and Asia," according to the report.
U.N. inspectors said Jordan and the Netherlands, another country where large quantities of the scrap were found, agreed to allow inspectors to observe the destruction of the engines and the other equipment.
Nevertheless, 18 SA-2 missile engines, seven high-tech machines that could be used to make missile parts, and other equipment essential to missile production remain missing, according to the report (Edith Lederer, Associated Press/Yahoo!News, Sept. 7).


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>> KERRY WATCH



Kerry's Iranian Connection Fights Democracy
By Robert Spencer
FrontPageMagazine.com | September 8, 2004
Frivolous lawsuits have long been used as weapons of the powerful against the weak; a particularly egregious example is now playing out in Texas, courtesy of one of John Kerry's most controversial supporters: the Iranian Hassan Nemazee. Nemazee is pursuing a ten-million-dollar damage claim against the Student Movement Coordination Committee for Democracy in Iran (SMCCDI) and its coordinator, Aryo B. Pirouznia. A Nemazee victory in this suit would almost certainly muzzle or destroy altogether the SMCCDI, one of the most energetic and courageous opponents of Iran's entrenched but uneasy mullahocracy. But now that Nemazee's lawsuit has been filed, it has become increasingly clear that it could embarrass the entire Democratic Party -- and severely damage the already flagging candidacy of John Kerry.
Nemazee is an influential figure with many friends in high places in groups such as the American-Iranian Council (AIC), the National Iranian American Council (NIAC), and the Iranian-American Bar Association (IABA). Nemazee's name is also well known in Democratic Party circles. He was a prominent contributor to Bob Torricelli's New Jersey Senate campaign. The multimillionaire entrepreneur also contributed $50,000 to his friend Al Gore's Recount Fund (and $250,000 to the Gore campaign), $60,000 to Bill Clinton's legal defense fund, and over $150,000 to the Democratic National Committee. Clinton attempted to reward him by naming him U.S. Ambassador to Argentina -- but the Senate declined to confirm him after Forbes magazine published, in May 1999, an extremely damaging expose of his shady financial dealings.
Undaunted, Nemazee continued efforts to establish fruitful contacts between Iranian groups advocating normalization of relations with Iran and high-level members of the Democratic Party. He joined the Board of Directors of the AIC, an organization whose president, Hooshang Amirahmadi, is identified on the SMCCDI website as a "well known lobbyist for the Iranian Mullahocracy." Nemazee was involved in a March 2002 fundraiser for Senate Foreign Affairs Committee heavyweight Joe Biden (D-DE). This event was hosted by Sadegh Namazikhah, another AIC member whom Aryo Pirouznia charges with trying to improve public perception of "one of the most despotic regimes in the world."
Three months later it was Kerry's turn: Nemazee invited the future Democratic standard bearer to speak at an AIC dinner. Nemazee himself also spoke, declaring that the AIC "does not attempt to explain or rationalize the position of the government of Iran, nor does it attempt to do so for the government of the United States. Its mission is to educate both sides and to attempt to establish the basis and the vehicle for a dialogue which will ultimately lead to a resumption of relations." If Kerry registered any protest against this assertion that the United States should normalize relations with one of the world's bloodiest dictatorships, it was not recorded. Nemazee, according to Iran experts Banafsheh Zand-Bonazzi and Elio Bonazzi, now seems to be denying that he ever made this speech at all -- although it is still posted on the AIC's website.
Outside San Francisco's Ritz-Carlton Hotel, where this grand event was held, the SMCCDI organized a large protest rally. Nemazee, evidently, would not forget this and other affronts. In his lawsuit, he charges that the SMCCDI knowingly and repeatedly made "false and defamatory statements" about his support for the Iranian regime. His complaint states categorically that "Nemazee does not `support ... the Islamic Republic and the Revolution.'"
But his friend Kerry, meanwhile, seems to have absorbed the very lessons that Nemazee now denies having tried to teach. Before the Council on Foreign Relations in December 2003, Kerry announced that he would be willing as President to pursue rapprochement with Iran: "As president, I will be prepared early on to explore areas of mutual interest with Iran, just as I was prepared to normalize relations with Vietnam a decade ago." And most notoriously, his staff sent out an email that somehow made its way to the government-controlled Mehr News Agency in Tehran, where it was trumpeted as evidence of his resolve to patch things up with the mullahs. "It is in the urgent interests of the people of the United States," the message read, "to restore our country's credibility in the eyes of the world. America needs the kind of leadership that will repair alliances with countries on every continent that have been so damaged in the past few years, as well as build new friendships and overcome tensions with others."
Kerry's camp professed puzzlement over how this email made it to Tehran. Initially, a Kerry aide dismissed the story as "just a hoax." But this pose proved impossible to maintain. Kerry's senior foreign affairs advisor, Rand Beers, later admitted that the message was genuine, saying: "I have no idea how they got hold of that letter, which was prepared for Democrats Abroad. I scratched my head when I saw that. The only way they could have gotten it was if someone in Iran was with Democrats Abroad." In light of the ties between the AIC and the Democratic Party, that possibility is at least open to question.
But Kerry's olive branches to the regime that carries on the legacy of the Ayatollah Khomeini now embarrass him: his Council on Foreign Relations remarks seem to have been removed from the Kerry-Edwards website. Hence also the Nemazee lawsuit: to silence the SMCCDI and its inconvenient protests. One way to do that is indirect, by using the suit to put the SMCCDI out of action. According to documents that Pirouznia/SMCCDI defense attorney Bob Jenevein made available to me, the prosecution has been playing several such games. On August 20, 2004, Jenevein wrote a letter to Rob Wiley of Locke Lidell & Sapp, the elite Texas law firm representing Nemazee. He proposed five stipulations -- points that both sides could agree to, so that they need not spend the court's time trying to establish or disprove them. These included: "1. The Islamic regime in Iran is sympathetic to terrorists. 2. The Islamic regime in Iran poses a threat to the security of the United States and/or its citizens at home or abroad. 3. For the United States to normalize its diplomatic relations with Iran at this time would lend credibility to the Islamic regime in Iran. 4. For the United States to ease trade sanctions against Iran at this time would lend credibility to the Islamic regime in Iran. 5. Anything that would lend credibility to the Islamic regime in Iran at this time would have value to that regime." Wiley answered on the same day that his team had taken the stipulations "under advisement"; but in the almost two weeks since then, gave no further answer. Thus Nemazee's attorneys effectively agreed to none of the stipulations, raising the prospect that Jenevein would have to spend hours upon hours in court establishing these points, thereby endangering the SMCCDI by straining its financial resources.
Other documents furnished by Jenevein suggest that the prosecution is trying to run up the costs of the litigation in other ways also -- attempting to find out who is paying Pirouznia's legal bills and to drive SMCCDI into destitution. One example was a fax that Wiley sent to Jenevein last Monday afternoon, informing him of a draft motion that the prosecution was planning to file on certain matters regarding the case unless the prosecution and defense reached an agreement by 5PM Tuesday. Jenevein immediately faxed a response, suggesting ways to agree, but the prosecution ignored it and filed the motion the next morning anyway. This multiplication of motions, of course, is a classic tactic to drive up court costs.
Related to all this is the curious fact that, according to an inside source close to the case, Nemazee has never made himself available for a deposition. Pirouznia's defense attorney contacted Nemazee's lawyers in early August, immediately after taking the case (five months after it was filed), to request dates for this deposition; Nemazee's team responded that he would only be available on two dates in November and two in December - all four after the election, and all over seven months after the case was filed. "He's saying we want his deposition for political reasons," the insider exclaimed incredulously, "but HE filed the lawsuit!" The Pirouznia/SMCCDI team has filed a motion ordering Nemazee to appear for a deposition on September 20; no ruling has been made on it yet.
Why file a lawsuit, and then play hide-and-seek with the defense? The lobbyist and his team seem to be trying to keep the case under wraps until after the presidential election. "Nemazee is worried that his candidate will be embarrassed if the facts of this litigation are made public," observes Jenevein. "I'm afraid that this case would appear typical of the frivolous lawsuits about which Republicans complain so loudly. To the extent that Hassan Nemazee constitutes a link between a presidential campaign and the Iranian regime, that link would be considered a grave political liability for the campaign.
The lawsuit is designed to silence those who speak about this."
The Nemazee camp appears to be growing increasingly anxious lest details of their suit leak out. That may be why, according to an informed source, the founder of a public relations firm and international speaker's bureau that specializes in foreign policy and terrorism-related issues recently contacted Pirouznia and invited him to lunch -- ultimately, two lunches on consecutive days, all to argue that he should drop the suit. Important figures of the Iranian democracy movement, the PR wizard intimated to Pirouznia, really wanted him to forget the whole thing. Dumbfounded, Pirouznia reminded the PR maven that it was he who was the target of the suit, and that he was only defending himself and his organization. Several other people who figures connected to the defense team wryly term "Nemazee's messengers" also contacted Pirouznia to make the same appeal.
The SMCCDI and Aryo Pirouznia are evidently not the only ones in Nemazee's sights. According to an informed source, Nemazee's lawyer asked in official documents used by the plaintiff to build the case about the relationship between Pirouznia and another pair of stalwart Iran democracy activists: Banafsheh Zand-Bonazzi and Elio Bonazzi. Said the source: "Aryo's lawyer objected that this is not relevant, but basically this means that even if Nemazee didn't sue the Bonazzis directly, they are among his targets." This despite the fact that the Bonazzis have never advanced any political agenda for Iran beyond promoting the idea of a genuine (not UN- or Jimmy Carter-led) internationally monitored referendum to decide on Iran's form of government after the complete ousting of any form of theocracy. Zand-Bonazzi's father, Siamak Pourzand, is a well-known Iranian journalist, intellectual, freedom fighter - and political prisoner of the Islamic regime.
Thus the mullahs fight on for their survival in the courtrooms of Texas.
Robert Spencer is the director of Jihad Watch and the author of Onward Muslim Soldiers: How Jihad Still Threatens America and the West (Regnery Publishing), and Islam Unveiled: Disturbing Questions About the World's Fastest Growing Faith (Encounter Books).

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>> ECONOMY


Creative Accounting Only Goes So Far
Unsound transactions are going to catch up with the government.
A new report from the Congressional Budget Office explains that the deficit is a virtually meaningless measure of the government's indebtedness. The main reason for this is that the federal government uses cash accounting rather than accrual accounting. What this means is that the government can acquire massive debts far into the future with virtual impunity. The government can also, in effect, cosign for loans and provide insurance that could potentially cost taxpayers hundreds of billion of dollars without it ever showing up in the budget until a check has to be written.
By the CBO's reckoning, the federal government's true debt last year was $8.5 trillion -- more than twice the debt held by the public, which we generally think of as the national debt. That figure came to $4 trillion, only slightly more than the $3.9 trillion in future benefits owed to government employees and veterans.
But even the $8.5 trillion figure is much too low because it excludes the really big debts that are owed for Social Security and Medicare. Since these obligations extend far into the future, the only way they can realistically be quantified is by using a statistical method called present value. This takes account of the fact that $1 fifty years from now is worth much less than $1 today. Future debts need to be discounted to put them into today's dollars.
Even with discounting, however, the figures are massive. The CBO estimates the unfunded liability for Social Security at $7.2 trillion. But this is virtually nothing next to the $37.6 trillion cost of Medicare. In short, we would need to have about $45 trillion in the bank today earning interest in order to pay all the promises that have been made for future Social Security and Medicare benefits -- over and above the future taxes and premiums that will be collected to fund these programs.
To put these numbers into a form that is comprehensible, the CBO has made a calculation of the future gross domestic product that will be produced over the same time period. These are the actual resources from which Social Security and Medicare benefits will be paid. The CBO estimates that we would have to raise taxes by 6.5 percent of GDP immediately and forever to maintain these programs in perpetuity. This year alone, that would mean a tax increase of $800 billion.
This is why I believe it was utter insanity for the White House and Congress to have enacted an expansion of Medicare for prescription drugs last year. This one unconscionable action increased the long-term liability of Medicare by 1 percent of GDP forever.
A key reason why they were able to get away with this idiotic action was that all the costs come well in the future -- the program doesn't even begin until 2006 and then phases-in for a few years before being fully effective. Thus, for a time, Republicans were able to promise something-for-nothing. It's only a matter of time before taxes are sharply increased so that the elderly can get for free what the rest of us have to pay for ourselves.
It goes without saying that if any private corporation had behaved the way the government has, it would soon find its executives being sentenced by a federal judge. It is illegal for businesses to keep their books the way the government does, hiding their long-term liabilities from shareholders the way the government disguises its indebtedness from voters.
Writing in the Nebraska Law Review last year, George Washington University law professor Cheryl Block compared bookkeeping by the federal government to bookkeeping by businesses involved in corporate scandals. She found little difference. Congress, she wrote, "has been guilty of using accounting devices remarkably similar to those used by Enron, WorldCom and others to `cook the books' and to mislead the public with regard to government finances."
At least when a corporation misbehaves, there is an ultimate market check in the form of bankruptcy. Creative accounting can only go so far in covering up transactions that are fundamentally unsound. But national governments never go bankrupt and don't have to worry about customers buying their goods and services for revenue. They just raise taxes or print money and keep on going. "As a result, temptations for the government to engage in creative accounting may be even greater than those in the private sector," Block suggested.
It's worth keeping this in mind the next time some congressional demagogue denounces corporate dishonesty.
-- Bruce Bartlett is senior fellow for the National Center for Policy Analysis. Write to him here.
http://www.nationalreview.com/nrof_bartlett/bartlett200409080940.asp

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$2.3 Trillion in New Debt Expected by 2014
Economic Growth Will Not Ease Strain on U.S., Budget Office Director Warns
By Jonathan Weisman
Washington Post Staff Writer
Wednesday, September 8, 2004; Page A02
This year's federal budget deficit will reach a record $422 billion, and the government is now expected to accumulate $2.3 trillion in new debt over the next 10 years, the Congressional Budget Office reported yesterday.
The expected deficit for the current fiscal year, which ends Sept. 30, is $56 billion less than the CBO predicted in March, as a recovering economy added to tax receipts. But it is $46 billion more than last year's record shortfall, with even more red ink possible, the nonpartisan agency reported: The expected total 10-year deficit would climb from $2.3 trillion to $3.6 trillion if President Bush is able to extend the tax cuts he enacted. They are currently set to expire in 2011.
"This is a fiscal situation in which we cannot rely on economic growth to cause deficits to disappear," warned CBO Director Douglas Holtz-Eakin, a former economist for the Bush White House. "The budgetary outlook will be dictated by policy choices."
About half of the projected 10-year deficit is based on an assumption that conflicts in Iraq and Afghanistan will continue. The CBO policy requires that deficit projections be based on current conditions.
The budget office expects that the total federal debt held by the public -- the amount borrowed through the sale of Treasury bonds to finance overspending -- will balloon 58 percent over the next decade, from $4.3 trillion this year to nearly $6.8 trillion in 2014.
The CBO's findings may refocus some political attention on the fiscal health of a federal government that, between recession, war and tax cuts, has swung from record surpluses to record deficits since Bush took office.
Both political parties seized on the CBO's findings, with Republicans stressing the $56 billion improvement over the CBO's March estimate, and Democrats focusing on the longer-term forecast.
The new estimate is "a sign of the economic growth that is a result of President Bush's leadership on tax relief," said Tim Adams, policy director for the Bush campaign.
Democratic presidential nominee John F. Kerry retorted, "Only George W. Bush could celebrate over a record budget deficit of $422 billion."
Budget analysts said the report should not be seen as good news to either side inasmuch as neither has a detailed plan to tackle the deficit.
"It's another one of those unwelcome reminders to the candidates that they've got some serious problems that they don't want to face," said Robert Bixby, executive director of the Concord Coalition, a budget watchdog group.
Bush has pledged to halve the deficit over the next five years. But absent sharp policy shifts, the CBO does not expect the president to meet that goal. The CBO estimated the annual deficit for 2009 to be $312 billion, short of the president's target. Compared with the size of the economy, the deficit in five years would fall to 2.1 percent of gross domestic product from its current 3.6 percent, a substantial improvement but not half of the 2004 level.
Chad Kolton, a spokesman for the White House Office of Management and Budget, said the CBO figures are deceptive because they include far too much money for continued fighting in Iraq and Afghanistan.
The CBO assumed both conflicts will continue for the next 10 years, at a cost of $1.1 trillion.
"The bottom line is, the president is committed to cutting the deficit in half in five years," he said.
The CBO report drew the policy choices facing the nation in sharp relief. The $2.3 trillion in projected deficits over the next decade assumes that all of Bush's 2001 tax cuts expire as scheduled in 2011 and rates rise to the levels that existed before. If the president and congressional Republicans are successful in extending the tax cuts, deficits would surge to $3.6 trillion through 2014, the CBO report said. In 2014 alone, a relatively modest annual deficit of $65 billion would leap to $440 billion if all the tax cuts are kept.
The alternative minimum tax, which was created to ensure the wealthy pay income taxes but which will increasingly ensnare the middle class, presents another fiscal strain. Reforming the law to exclude more middle-class taxpayers -- which both parties say is a priority -- would cost the government at least an additional $425 billion over the next 10 years, and possibly as much as $602 billion, the CBO said.
By then, the cost of the retiring baby-boom generation will have hit the government hard. Social Security and Medicare, currently $789 billion, or 34 percent of federal spending, will swell to $1.5 trillion, or 42 percent of the budget.
Neither Bush nor Kerry has detailed how he would tackle the deficit. Both candidates have made campaign pledges that probably would worsen the government's fiscal position, although the candidates have been careful to avoid a detailed accounting.
In Bush's acceptance speech in Madison Square Garden on Thursday night, he reiterated a call to allow younger workers to invest some of their Social Security payroll taxes in stocks and bonds through personal investment accounts. Because virtually all Social Security taxes are used to pay the benefits of current retirees, any diversion of those taxes would have to be made up through more government borrowing. Even a small diversion of, say, 2 percent of payroll taxes, could cost the government as much as $2 trillion in the first 10 years, according to the Social Security Administration's actuary.
Bush has also called for new Lifetime Savings Accounts, which would effectively end the taxation of capital gains, dividends and interest for all but the richest Americans. Individuals could shield from taxation the investment gains of as much as $7,500 of savings a year, and those savings could be withdrawn at any time for any reason. The cost of the proposal would be minimal in the first decade but could swell to $50 billion a year in later decades, according to the Congressional Research Service.
Kerry has pledged to roll back some of the tax cuts passed in 2001 and 2003, including income tax, capital gains and dividend cuts that have benefited households with incomes of more than $200,000. But the savings from those tax increases would be consumed by a $653 billion expansion of health care coverage, a $200 billion education program and other promises.
"Neither one of them is focused on deficit reduction, and neither one of them is focused on hard choices," Bixby said. "And the message of today's report is that tough choices are needed."
Staff writer Mike Allen contributed to this report.
? 2004 The Washington Post Company


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The Market State President
By Gregory Scoblete Published 09/08/2004
TCS
http://www.techcentralstation.com/090804C.html
One of the most intriguing aspects of President Bush's convention acceptance speech last week was his rhetorical embrace of the Market State, a concept fleshed out by Phillip Bobbitt, a former director of intelligence in the National Security Administration under President Clinton, in his opus The Shield of Achilles: War, Peace and the Course of History.
Through the course of 800-plus pages, Bobbitt sketches out the history of state evolution -- from Princely States to the Nation State -- arguing that both external threats and the domestic quest for legitimacy shape the relationship between government and the governed. He argues that with the passing of the Long War (defined as the period beginning with World War I and ending with the dissolution of the Soviet Union) we are now in a transitional period from the Nation States that dominated the 20th century to the Market State that looks to define the 21st.
The Nation State was defined and legitimated, in part, by its ability to ensure the material well being of its citizens. In contrast, the Market State earns its legitimacy by providing the opportunity to its citizens to advance their own well being. The Nation State is characterized by top-down, government centric solutions like the welfare state, that make absolute guarantees about the material outcome of its charges. The Market State simply says: we'll guarantee a set of basic tools and an open playing field, but after that, you're on your own to make of it what you will.
Bush embraced this transition to the Market State. In his domestic proposals, Bush explicitly acknowledged that the Nation State welfare-model needed to give ground:
The times in which we work and live are changing dramatically. The workers of our parents' generation typically had one job, one skill, one career, often with one company that provided health care and a pension. And most of those workers were men.
Today, workers change jobs, even careers, many times during their lives, and, in one of the most dramatic shifts our society has seen, two-thirds of all moms also work outside the home.
This changed world can be a time of great opportunity for all Americans to earn a better living, support your family and have a rewarding career.
Bush's domestic agenda, allowing younger workers to direct the investment (of their own money) in Social Security, of portable pensions to follow a mobile work force, and reforming a cumbersome tax code, is specifically aimed at devolving responsibility for individual welfare from the State to the individual. He touts it as an "ownership society" but it could just as easily be called an "opportunity society" - under Bush's vision, the government promises that all citizens will have the opportunity to advance themselves, regardless of station. That is a distinctly different promise than the traditional Nation State compact that guarantees your welfare by redirecting wealth from one population segment to another.
Even the President's proposed spending initiatives -- increased money to education, to child heath care, and to junior colleges - had one consistent, Market State theme: the State is responsible for laying the foundation for your well-being but ultimate success is up to you.
The unspoken corollary -- intolerable to Democrats -- is that if you fail, the State will have a very limited capacity to help you. Indeed, critics of Bush will decry this as a move designed to ultimately gut the welfare state. And they will be correct -- it is. And it is vital.
Why A Market State?
The answer, Bobbitt says, is simple: the threats we now face demand it. The government simply cannot fulfill its core function of protecting its citizens from modern dangers and fulfill the material promises of the Nation State. We see but a glimpse of this reality in our massive budget deficit. The necessary yet costly demands of the War on Islamic Terrorism - extended overseas troop deployments, the protection of critical homeland infrastructure and strengthening of the public health system to gird against a bio-terror attack - simply cannot coexist alongside a raft of social spending commitments. 21st century threats have collided with a 20th century government. And terrorism is just the beginning.
The globalization of the economy with its attendant global travel, the widespread adoption of advanced communication tools (the Internet, mobile phones, etc.) and the growing ubiquity of sophisticated weapons technology bring with it other threats, anticipated by Bobbitt, including global pandemics and crippling attacks on global infrastructure including cyber attacks that shut down critical banking and security systems. These new perils will require a massive, sustained, financial investment to safeguard against.
These threats are not passing dangers that will be vanquished quickly even with an enormous investment in blood and treasure such that defeated the fascist regimes of Nazi Germany and Imperial Japan - they are systemic to the world we live in and necessitate radical changes in the structure and promises of government if they are to be met successfully. A government that cannot defend against these new dangers will ultimately forsake its legitimacy.
In this sense, critics of Bush's failure to create a war-time economy of rationing or conscription are wrong: this is not a "crises" necessitating even a prolonged period of "sacrifice" and then a return to "normal." This is, as Vice President Cheney noted, the "new normal" - a reality for an indefinite period of time. Even if radical Islamism is utterly defeated and discredited, the U.S. will still be threatened by global plagues, still be vulnerable to crippling cyber-attacks, and still fall prey to small bands of highly motivated fanatics intent on using advanced weapons toward devastating ends.
The Nation State cannot simultaneously protect against these new threats while offering cradle-to-grave assurances of material well-being. For the fiscal solvency of our nation, one or the other has to give. And since the State's core, irreducible function is the physical security of its citizens from external harm (as opposed to their material security), the responsibility for the later must be shifted to the citizen. The Nation State must cede ground to the Market State.
Conservatives who grumble about "big government" are therefore off the mark. The absolute size of the government - what it reaps in tax receipts - will stay constant, and probably grow (indeed, Bobbitt argues that the power and reach of the executive branch must ultimately be expanded and empowered to act with even fewer restraints if it is to ward off new dangers). It is the priorities of said government - how the money is dispersed - that have to change and radically.
The Rubber Meets the Road
When viewed in this light, Bush's domestic proposals are essentially aimed at mid-wifing the Market State into existence. Bush is proposing to steer many of the welfare state's commitments (to retirement, to health care) back to the individual, freeing the government to concentrate on safeguarding the country from a myriad of new dangers. But will increasing the government's commitments to social welfare, as Bush is practically proposing, ultimately enable the government to curtail those same commitments down the road? Once fed, will government fast or become more rapacious? Is Bush even sincere in his desire to redirect government toward the Market State model, or is it all just a Rovian ploy to buy off core voting blocs, an act of fiscal recklessness of a peace with the expansion of Medicare - an act that ignores the long-term economic impact in favor of the short term electoral gain.
Only time, and a second Bush term, will tell. What won't change is the imperative driving the need for a Market State. President Bush or President Kerry and their 2008 successors will be starring down the same abyss: the threats of the 21st century cannot be met with the government of the 20th. To meet the challenge, the President will have to ensure that each citizen has the opportunity to achieve material prosperity and the financial means to safeguard their wealth, health and retirement, while the government directs its energies to warding off the dangers of a new world.
One thing is certain: it will take an act of supreme political cunning to deftly cut-loose the ballooning baby-boom generation from the money it has and continues to promise itself. Is Bush that cunning?
He's been misunderestimated before.
Gregory Scoblete is a senior editor at TWICE Magazine (This Week in Consumer Electronics) and a contributing writer to Digital Photographer and Camcorder & Computer Video magazines. He is the author of the forthcoming e-book Ten Quick Steps Guide to Great Digital Photography. He writes regularly about technology and politics at www.gscobe.blogspot.com.



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A Cancer in the Medicare System
By Doug Bandow Published 09/07/2004
TCS
Medicare faces trillions of dollars of unfunded liabilities, but legislators are constantly tempted to increase benefits and thus spending. They should resist their inner darkness as the Bush administration attempts to create a more rational reimbursement system for cancer drugs.
Although Medicare has never covered pharmaceuticals -- the benefit package passed last year won't kick in until 2006 -- it made an exception for cancer drugs administered by oncologists. The cost was $10.5 billion in 2003.
Yet rather than pay physicians a fair fee, Congress set drug reimbursements based on the industry's official Average Wholesale Price (AWP), rather like the sticker price of new automobiles. Observes Grace-Marie Turner of the Galen Institute, doctors used the resulting "spread" between cost and reimbursement "to cover Medicare's underpayments for their practice expenses."
A 1997 study by the Office of Inspector General of the Department of Human Resources figured that Medicare was paying as much as ten times actual drug costs. Occasionally the disparity
was even greater.
The AWP for the drug vancomycin ran 76 times the price to doctors. Physicians even charged for drugs, such as Lupron, used to treat prostate cancer, which they had received as free samples from manufacturers. All told, 70 percent of oncologists's Medicare revenue came from drug mark-ups.
The system unfairly penalized beneficiaries, responsible for a 20 percent copayment, as well as Uncle Sam. The system also biased treatment decisions, since price spreads varied by drug. Sometimes older, less effective medicines were more profitable than better treatments.
Medicare officials long noted the problem, but Congress, lobbied heavily by oncologists, would only make marginal cuts in pharmaceutical reimbursements.
Critics often blamed the drug companies -- state attorneys general and left-wing activists even sued some drugmakers on a variety of charges -- but the industry gained nothing from the scheme. The fault belonged to Congress.
Last year's Medicare bill amended Part B to bring reimbursements into line with costs. Medicare is supposed to use the Average Sales Price, what drugs actually sell for, including discounts and rebates. Medicare recently issued rules expected to save the government about $530 million and beneficiaries roughly $270 million.
In return, Congress doubled the average payment for administering drugs. There's also a transition bonus for 2004. The Centers for Medicare and Medicaid Services (CMS) acknowledges that overall cancer payments will fall, but indicates that it will consider future adjustments.
Few physicians defend the old system. Dr. David Johnson, head of the American Society of Clinical Oncology, says "We would agree with a premise that the way the system has operated for some years has been out of balance."
However, many oncologists nevertheless denounce the reform scheme as providing inadequate returns. Some are threatening to stop providing drugs in their offices, which would force patients to turn to hospitals. They are lobbying Congress to freeze payments.
Fixing reimbursement rates obviously isn't easy. As Grace-Marie Turner points out, "the overall problem of government setting prices -- and trying to get them right -- is endemic to a benefit-based entitlement program." Medicare has long created incentives towards overuse as a fee-for-service reimbursement system while generating the inefficiencies that naturally occur with price controls.
Getting it right, however, is critical. Frank Lichtenberg of Columbia University figures that more than half the increase in cancer survival rates over the last quarter century is due to new and improved drugs. Maintaining that progress is critical.
Thus, Congress shouldn't retreat from its reliance on sales rather than list prices. The old system never made sense. Uncle Sam should drive a stake through the heart of the beast.
At the same time, where necessary CMS should increase oncological reimbursements for administering drugs. The federal government needs to come as close as it can to a quasi-market price in a non-market environment.
In the longer-term, Congress should revamp Medicare to make it more friendly to both patients and physicians, while creating incentives for cost-saving. That means integrating the new drug benefit into Medicare's overall structure,
Moreover, Congress should transform the program from a system of defined-benefits -- for which it must set specific reimbursement rates -- to one in which a defined contribution is made to retirees for use to buy the health care plan which best meets their needs. This would get the government out of price-setting entirely.
Unfortunately, legislators have routinely proved to be irresponsible when they touch Medicare. With the budget wildly out of balance and taxpayers facing huge liabilities as the Baby Boom generation starts collecting Medicare and Social Security, Congress must learn to say "no." It should start when responding to oncologists who hope to return to last year's broken system for reimbursing cancer drugs.
Doug Bandow is a Senior Fellow at the Cato Institute.
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Is This Any Way to Grow an Economy?
By Christopher Lingle Published 09/03/2004
TCS
In a fruitless and pointless exercise, economic policy makers and businesses fret endlessly over the international value of currencies. This is because interventions to guide foreign exchange valuations tend to be costly and may have only temporary effect, at best.
The dollar's value measured by a trade-weighted index against a basket of currencies has been in decline for more than a year. Some economists, businessmen and politicians in America believe that a weaker dollar will be "good" for the US economy.
They apparently believe that a depreciating dollar will boost exports of US manufacturing production while increasing employment and creating economic growth. Meanwhile, central bankers and finance ministers in Japan and China have been accused of playing games to block the appreciation of their currencies from appreciating against the US dollar.
It turns out that the arguments used in these harangues reflect political expediencies rather than sound economic logic. The most obvious evidence of this is that the balance of trade is not the best measure of the overall welfare of a country.
Part of the problems comes from the dubious claims that a depreciating currency can increase the competitiveness of domestic producers. In fact, currency depreciation should never be a policy objective since it leads to economic immiseration.
It is chimerical to think when citizens of a country receive fewer real imports for a given amount of real exports is an improvement in competitiveness. The country with a depreciating currency may receive additional units of foreign currencies, but it will possess less real wealth in the form of goods and services.
In the adjustment to the declining foreign value of a currency, exports tend to rise while imports tend to fall. This means that consumption must decline for citizens of the country with the depreciating currency since they receive less for is sold to foreigners and more is paid for what is bought from foreigners. By any measure, this is a decline in overall living standards.
In all events, the supposed advantages created by depreciating currencies upon export sales or increased tourism are temporary. This is because domestic prices and wage rates eventually rise due to the new foreign exchange values. Obviously, a persistent rise in prices harms consumers while undermining long-term business investment, rising wages may also contribute to higher unemployment.
It turns out that most adherents of a weak dollar believe that economic growth depends upon aggregate demand for goods and services, both from both domestic and foreign sources. According to this logic, increases in demand for goods and services can push up economic growth rates by triggering the production of goods and services. The implication is that policies that focus upon overall demand can promote economic growth.
This notion is also behind the "export-led" growth policies of many developing countries. Since exports are seen as contributing to economic growth while imports are portrayed as a drag on economic growth, they seek a weak currency so that the prices of domestic output are more attractive to foreigners.
These notions are based upon a misguided belief that increases or decreases in production can be traced to rising or falling overall demand for goods and services. The suggestion that consumption can precede production is based upon both logical impossibility and economic infeasibility.
It might be helpful to trace the impact of monetary policy on foreign exchange markets to see how a currency might depreciate. If the central bank or finance ministry wishes to push down the international value of the domestic currency, they buy foreign currencies. Increased supply of the domestic currency in money markets combined with increased demand for the foreign currency pushes down the value of the former while raising the value of the latter.
At this point, producers are better able to sell more exports. But it is important to know the source of the funds used to intervene in the foreign exchange markets. If they are drawn from existing currency supply, there would be a reduction in liquidity in the financial system. It is likely that the central bank would purchase government bonds, causing more local currency to be available.
As producers seek to respond to increase demand for exports, they find that commercial banks can offer loans at lower interest rates due to the loose monetary policy. In turn, producers find it cheaper to borrow to acquire resources for expanding their output of goods. This newly-created credit allows these producers to divert resources from other productive activities. Initially, exporters experience increased profits, until domestic prices begin to rise under pressures of the bidding war to control access to inputs.
Ultimately, loose monetary and credit policy cause the domestic prices of goods and services to rise. And then there will be a decline in profits earned from exports as well as domestic sales. And so it is that rising prices ends the illusion that prosperity can be conjured out of thin air by pumping new pieces of paper money into an economy.
A supreme irony emerges from the above logic. It turns out that monetary policy responses arising out of obsessions with international currency values increase the volatility of foreign exchange markets.
So, what we are left with is that government interventions in markets at one level create a demand the government to intervene at another level. And this cycle continues; ad infinitum and ad nauseum.
Christopher Lingle is Visiting Professor of Economics at Universidad Francisco Marroqu?n in Guatemala and Global Strategist for eConoLytics.


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>> RUSSIA
Russia Test-Fires Ballistic Missiles
The Russian nuclear submarines Yekaterinburg and Borisoglebsk yesterday conducted ballistic missile test launches, Interfax reported (see GSN, Aug. 12).
"Both launches proceeded successfully. The missiles' warheads hit their training targets at the Kura testing ground on the Kamchatka (Peninsula) at their designated time," Russian Navy spokesman Capt. Igor Dygalo said.
Navy commander Adm. Vladimir Kuroyedov observed the launches from the cruiser Pyotr Veliky, Dygalo said (Interfax, Sept. 8).



Russia and the Terror War
By Stephen Schwartz Published 09/07/2004
TCS
In the wake of the latest tragedy in Russia, it is perhaps in bad taste to cite two clich?s, but both apply stunningly to the present situation in that tormented land. The first is, "the more things change, the more they remain the same." That is certainly reconfirmed by the Putin government's "handling" -- a term that, as we shall see, may have a sinister aspect -- of the hostage horror in North Ossetia.
The second clich? is a phrase on the lips of every policy wonk in the Western world these days: "lessons learned." All and sundry claim to possess the wisdom of "lessons learned" about everything, especially about the global war on terror. But if there is a major lesson that has seemingly remained unlearned, it is that Russian political leadership is unchanging in its improvised, haphazard violence, its secrecy, and the willingness to sacrifice the blood of its subjects -- they can barely be called citizens.
In 1855 the great Russian liberal Aleksandr Herzen published a book titled From the Other Shore, in which he observed the following about his native land: "The revolution of Peter the Great replaced the obsolete squirearchy of Russia -- with a European bureaucracy; everything that could be copied from the Swedish and German laws, everything that could be taken over from the free municipalities of Holland into our half-communal, half-absolutist country, was taken over. But the unwritten, the moral check on power, the instinctive recognition of the rights of man, of the rights of thought, of truth, could not be and were not imported."
Exactly the same may be said of Russia in the aftermath of Communism's fall. Everything that could be copied from the West, from flamboyant gangsterism to sensationalist journalism to an uncontrolled sex industry, has been adopted. But the essential checks and balances on state power have not been and probably cannot be imported.
It is to further trivialize the tragedy for a moment, but whence will come Putin's Michael Moore? The slobby documentary film-maker has managed to make quite a success out of a video clip showing President George W. Bush remaining silent for seven minutes after receiving news of the terrorist assault in Manhattan three years ago. But Putin was silent for two days during the crisis in Beslan!
And now, according to The Washington Post, the Russian authorities have admitted lying to the people about the Beslan atrocity, while the same rulers seek to turn the recognition of their prevarication into a virtue. A report by Susan B. Glasser and Peter Finn in Monday's Post states blithely, "In previous crises with mass fatalities, such as the sinking of the nuclear submarine Kursk in 2000 and the 2002 siege of a Moscow theater, officials covered up key facts as well, but afterward never acknowledged doing so."
This convoluted reality is not new. Did not the Russian government of Joseph Stalin lie about the artificial famine created in Ukraine in the early 1930s, in which several million died; about the brutal purge trials, in which the leaders of the Bolshevik Revolution were portrayed as Nazi spies; about the 1939-41 pact with Hitler, in which Germany was presented as a friend of the Russian people while it prepared for genocidal war against them; about the slaying of thousands of Polish officers in the Katyn forest; about, in the end, everything?
In 1956 it was admitted that Stalin was not a good man and that the victims of the purges were innocent, and at the end of the 1980s a certain Mikhail Gorbachev, a predecessor of Putin about whom nobody speaks today, averred that Soviet socialism had in some respects failed. Those were considered milestones of truth-telling in their time, just as the vague confessions of top state officials in the aftermath of Beslan are treated as a breakthrough. No irony is, however, perceived in the historical fact that the very conflict with the Muslim Chechens, always cited as the root of these terror incidents, derives from a sequence of characteristic lies by the Russian state.
During the Second World War Stalin deported entire Muslim nations from the Caucasus -- the Chechens were only the largest group -- on the charge of collaboration with the Nazis. At least 40 percent of the Chechens died during their forced transfer to Central Asia. In the 1960s the Soviet government admitted that the charge of collaboration was a lie, and that Chechens had actually fought valiantly in the Soviet forces. They were allowed to return to their ancestral homelands. But they did not forget or forgive, and after the breakup of the Soviet Union the "Chechen question" returned again.
So at least 350 children, parents, and teachers dead in Beslan, with more than 200 unaccounted for, is, finally, business as usual for the Russian state. It would seem to be high time for the West to recognize this. Russia and Putin are no more reliable partners in the global war on terror than the kingdom of Saudi Arabia, which also engages in lying on a cosmic scale.
Of course, Putin, as a veteran of the Soviet secret police, has adopted the Stalin method for dealing with responsibility in such events. When the Soviet state proved unable to satisfy the exaggerated promises it had made to its citizens in the 1930s, under the Five Year Plans, of plentiful consumption and prosperity, first the Bolshevik old guard and then the top leaders of the military were massacred to give the people a sense that "those to blame would be dealt with." Today, Russian TV, under Putin's control, accuses "generals and the military and civilians" for the terrible outcome in North Ossetia.
Some startling details of the Beslan massacre deserve further investigation, but since Russia, like Saudi Arabia, feels no need to account for its state actions to its people or to the world, it is doubtful they will be the subject of serious inquiry.
First, many Russians, experts on Russia, residents of the borderland states in Central Asia, and experts on Islamist extremism believe there is some kind of hidden link between the terrorists involved in attacks on schools and other such targets, and the Russian secret police. The logic is simple: Russian leaders always need an enemy, preferably one both inside and outside the country, to unite their discontented masses behind them. In the past the enemy was the Catholic Church, then the Jews. But stoking hatred of Catholicism causes problems with Poles, Lithuanians, and Ukrainians, who fight with much better weapons than suicide bombs, namely, financial power and access to Western media. And incitement against the Jews brings on an instant and negative response in the U.S. and Western Europe. In this context, the Russian and Caucasian Muslims are the obvious best choice as a chosen, cultivated threat with which to terrify the ordinary populace. Putin needs the terrorists as much as they need him; they are engaged in a dance of death, where each justifies the actions of the other.
Second, while news reports alleged that the terrorist attackers were not Arabs, as claimed (in a rare moment of probable accuracy) by the Russian authorities, surviving hostages described them as Wahhabis, adherents of the state cult in Saudi Arabia that stands behind al-Qaida, and identifiable by their distinctive beards and prayer caps. Since 1999, Saudi infiltrators have striven to take over and manipulate the Chechen national movement, pushing aside moderate Chechen leaders who seek peace.
Indeed, in a very strange item also appearing in The Washington Post, the terrorist assault squad leader was addressed as "colonel" and described as communicating by telephone throughout the siege. "Colonel" of what? Islamist terrorist movements do not use Western-style military ranks.
I predict that independent Russian opinion, which will be heard despite the control of media by Putin's government, will soon ask whether this was not yet another provocation by the secret police, intended to boost support for Putin and utilizing Wahhabis ready, in any event, to die -- but which went horribly wrong.
To Westerners, such an idea smacks of the most complex and unlikely conspiracy theories. But to Russians, and those who know Russia, it would come as no surprise. Putin has a great deal to answer for, but it is unlikely he will have to do so, any more than any of his predecessors in power had to. And, barely mentioned in this landscape of evil, Saudi Arabia and its Wahhabi cult also bear significant guilt.
In 1991, I wrote in the post-Soviet journal Arguments and Facts International, "The picture of Russia's future... increasingly resembles an 'India of the North:' a country that may achieve a partial or superficial democratization, but which is simply too handicapped by cultural factors to attain the stability and prosperity for which it hopes." After the passage of 13 years I would change nothing in these words.

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>> OSCE

This Is Security and Cooperation?
How the Organization for Security and Cooperation in Europe treated elections in the Balkans.
by Stephen Schwartz
09/08/2004 12:00:00 AM
Sarajevo
AT A TIME when the Organization for Security and Cooperation in Europe is preparing to send observers to monitor the U.S. elections in November, it is especially depressing to contemplate the OSCE's record in the Balkans. In both Bosnia-Hercegovina and Kosovo, the organization is a pillar of regimes run by the international community that have kept power in the hands of foreigners rather than preparing the way for any transition to local self-government. In both places, elections have been turned into ludicrous spectacles of political correctness and censorship.
In Bosnia, for example, the OSCE--a kind of mini-United Nations with 55 members, mostly from North America, Europe, and the former Soviet Union--has seen fit to require that 30 percent of candidates for public office be women. Unsurprisingly in a traditional East European society with a large Muslim population, this quota did not encourage people to vote for women candidates, appreciated though it was by foreign experts. In an even worse instance of mischief, the OSCE intervened in the 2000 Bosnian elections with a propaganda campaign urging voters to replace the ruling moderate Islamic party in Sarajevo with the former Communist party. The slogan that appeared all over Sarajevo was "Vote for Change." Sarajevans asked themselves, Why are these foreigners telling us how to vote?
No plan whatever exists for the transfer of political sovereignty to Bosnians themselves. Almost a decade after the Dayton Accords that created the international administration, Bosnia is still divided between a Croat-Muslim zone and the so-called "Republic of Serbs." Bosnian Muslims, who made up some 45 percent of the country's population before the onset of aggression by Slobodan Milosevic in 1992, today control only 28 percent of Bosnian territory. Thus, the OSCE in effect rewarded Milosevic and his minions through "facts on the ground," even as Milosevic himself sits on trial in The Hague.
In addition, the OSCE stands as a barrier against privatization and investment in Bosnia. Lacking economic opportunity, young Bosnian Muslims increasingly heed the call of Wahhabism, the extremist state cult in Saudi Arabia that continues to deluge Bosnia with missionaries and mosques. In the streets of Sarajevo one may purchase propaganda promoting Islamist suicide terrorism, although no such thing occurred during the Balkan war and is unlikely to occur there today.
But the area where OSCE policies have been worst is the media. In Bosnia-Hercegovina, OSCE censors, under the pretext of barring "hate speech," have made it impossible for Muslims, Serbs, and Croats to freely discuss their differences and grievances in a way that would make possible a reconciliation between them. Discussion of "genocide" is essentially banned; independent TV stations are discouraged. Instead, the OSCE plasters the walls of Bosnian cities with posters offering abstract appeals to friendship and cooperation.
In Kosovo, under international administration since 1999, the OSCE has been even more heavy handed in its licensing of broadcasters and monitoring of content. This has provoked great anger among local journalists. Much more than in Bosnia, "international community" rule in Kosovo has left the province, whose population is enterprising and hard-working, plagued by unemployment and other social problems, leading to strikes and assorted protests.
In March, Kosovar resentment boiled over into an insurrection in which some 30 people were killed. Violence was touched off by a report that three Albanian children had drowned after they were pursued into a rushing river by Serbs in the city of Mitrovica, in northern Kosovo, which is divided between the two ethnicities.
In April, the OSCE issued a report that blamed the March events on Kosovar journalists, who it claimed had sensationalized their reports. The Brussels-based International Federation of Journalists (IFJ) responded with a condemnation of the OSCE, stating that the report had failed "to establish any evidence of systematic attempts to distort the news coverage and incite violence." The IFJ accused the OSCE of laying responsibility on journalists for violence that had "its roots elsewhere"--truth to tell, in the incompetence of foreign rulers in the Balkans, in which OSCE is a prime culprit.
Perhaps when they come to the United States this fall, the election observers from the OSCE--an organization whose members include such models of representative government as Belarus, Turkmenistan, Moldova, and Ukraine--can learn a bit about how real democracies work and start to think about applying it in the Balkans.
Stephen Schwartz is the author of The Two Faces of Islam.
? Copyright 2004, News Corporation, Weekly Standard, All Rights Reserved.

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>> NUCLEAR

U.S. envoy Bolton to stop here on way to nuclear talks
By Aluf Benn
A senior U.S official will visit Israel for consultations prior to the International Atomic Energy Agency's board of governors meeting next week to discuss Iran's nuclear program. U.S. Undersecretary of State for Arms Control and International Security John Bolton will come to Jerusalem Sunday on his way to the IAEA meeting in Vienna. Bolton is scheduled to meet with Foreign Minister Silvan Shalom and senior Israeli officials, as part of efforts to transfer the "Iran case" to the United Nations Security Council.
Political sources in Jerusalem do not expect results from the upcoming board of governors meeting, and the diplomatic battle will likely be postponed until the board's November meeting. Iran hopes the suspicions against it will be removed from the IAEA agenda, and it will be able to continue with its uranium enrichment program.
The U.S. seeks to have Iran declared in violation of its international nuclear commitments, mandating transfer of the matter to the Security Council. The UK, Germany and France have made no progress in efforts to reach a compromise with Iran, but still prefer negotiations with Tehran.
Prior to the board of governors meeting, both sides are shoring up their positions with widespread diplomatic activity. IAEA Director-General Mohammed ElBaradei's last report on the Iranian program was lukewarm and generous to the Iranians, in Israel's opinion.
There is a dispute in the U.S. administration regarding the proper policy toward Iran. Bolton, a key hawk in the Bush administration, believes that diplomacy won't work with Tehran. Another approach calls for talks with Iran, in an attempt to dampen its ambitions to acquire nuclear arms.

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Nuclear Weapons Charges Against South African Man Dropped
By Craig Timberg
Washington Post Foreign Service
Wednesday, September 8, 2004; 2:54 PM
JOHANNESBURG, Sept. 8 -- South African authorities on Wednesday abruptly dropped criminal charges against a Pretoria man charged last week with possessing components for the construction of nuclear weapons.
Today's move was part of a deal in which the man, Johan Andries Muller Meyer, 53, will cooperate with prosecutors to pursue other targets of the investigation, said a source familiar with the probe who spoke on the condition of anonymity.
Police arrested Meyer Thursday in Vanderbiljpark, an industrial town south of here where Meyer is a director of Tradefin Engineering. He was charged with violating South Africa's strict laws against nuclear proliferation.
Eleven shipping containers of components for a gas centrifuge, used in the enrichment of uranium, were confiscated, as was related documentation and a machine that can be used to make other weapons components, officials here say.
The arrest was part of a wide-ranging international investigation into the nuclear black market that was established by Pakistan's top nuclear scientist, Abdul Qadeer Khan, and that helped Libya and other countries develop nuclear weapons programs.
Authorities were cautious in their public statements today. Sipho Ngwema, spokesman for the F.B.I.-style Scorpions, said only, "Charges have been dropped."
He declined to comment on whether Meyer remained under suspicion for wrongdoing. Meyer's defense attorney also has declined comment, according to wire service reports.
? 2004 The Washington Post Company
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North Korea Warns of 'Nuclear Arms Race'

By Sang-Hun Choe
Associated Press Writer
Wednesday, September 8, 2004; 4:27 PM
SEOUL, South Korea -- North Korea accused the United States of applying a double standard on the Korean Peninsula and warned Wednesday of a nuclear arms race in Northeast Asia following the revelation that South Korean scientists enriched a tiny amount of uranium in 2000.
The controversy over the South Korean experiment threatened to further disrupt troubled efforts to persuade North Korea to dismantle its suspected nuclear weapons programs.
North Korea's envoy to the United Nations, Han Sung Ryol, told South Korea's national news agency Yonhap that the communist state found the United States "worthless" as a dialogue partner because it was applying "double standards" to the two Koreas.
Han called South Korea's uranium enrichment experiment "a dangerous move that would accelerate a nuclear arms race in Northeast Asia," Yonhap said.
"We see South Korea's uranium enrichment experiment in the context of an arms race in Northeast Asia," Han was quoted as saying. "Because of the South Korean experiment, it has become difficult to control the acceleration of a nuclear arms race."
Han's comments were North Korea's first reaction to the South Korean admission this week that its scientists produced a small amount of enriched uranium in an experiment in 2000.
The reaction signaled that North Korea could use the South Korean experiment as leverage in any further talks on U.S.-led efforts to persuade North Korea to give up its nuclear development.
Earlier Wednesday, South Korea said it should have reported the uranium enrichment experiment to the U.N. nuclear watchdog agency.
South Korea admitted last week that its scientists produced 0.2 grams of enriched uranium during the experiment at its main government-affiliated nuclear research institute.
"We should have reported that uranium was used during this experiment," a senior official at the South Korean Foreign Ministry said on condition of anonymity. He spoke to reporters at a briefing.
South Korea has denied the experiment reflected an interest in developing nuclear weapons.
State Department spokesman Richard Boucher has criticized the secret experiment, saying it shouldn't have occurred. But he praised South Korea for working with the International Atomic Energy Agency to make sure the program has ended.
"We have confidence that the agency will pursue all these matters," Boucher said Wednesday.
Asked whether South Korea had experimented with plutonium, Boucher withheld comment, noting the United States is aware of what Seoul has reported to the IAEA about its past activities.
In the early 1970s, South Korea was developing a nuclear weapons program, but abandoned it under U.S. pressure and signed the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) in April 1975 before producing any fissile material required to make a bomb. A senior Bush administration official said Wednesday that those secret experiments involved plutonium.
The IAEA has asked "plutonium-related" questions during the course of routine investigations over the years, but the plutonium issue was not mentioned in the recent IAEA report on the uranium enrichment case, the South Korean Foreign Ministry official said.
"Regarding plutonium, there is nothing that could be interpreted as a violation of NPT like the current uranium enrichment case," the official said. He declined to comment in detail.
Han, the North Korean diplomat, complained the Bush administration was being unfair.
"The United States is applying double standards," Hans was quoted as saying. "While saying it trusts South Korea, it is trying to force North Korea to accept nuclear inspections, concocting a story about a HEU (highly enriched uranium) program we don't even have."
The latest South Korean experiment took place two years before a nuclear crisis erupted on the divided Korean Peninsula, when the United States accused North Korea of running a secret uranium enrichment program.
North Korea denied the charge but withdrew from the Nuclear Nonproliferation Treaty in early 2003. It has also restarted plutonium facilities that were mothballed under a 1994 accord with Washington.
The impoverished North said its nuclear development was for peaceful purposes. But it also says it is increasing its "nuclear deterrent" against a U.S. plan to invade, and that it will abandon its atomic development only if Washington provides nonaggression guarantees and energy and economic aid.
Washington wants North Korea to allow immediate nuclear inspections and dismantle all nuclear facilities.
Accusing the United States of breaking an earlier promise to provide economic aid in return for nuclear inspections, Han called Washington "worthless" as a dialogue partner.
The United States, Russia, Japan, China and the two Koreas have held talks on North Korea's suspected nuclear weapons development, and they agreed to hold another round of negotiations in Beijing this month. However, no date has been set.
The South Korean Foreign Ministry official said the Vienna-based IAEA will decide next week whether the South Korean experiment was a violation of international nuclear safeguard agreements.
The official insisted the experiment itself was not, but said South Korea should have reported enriched uranium had been produced.
The Ministry of Science and Technology said it learned about the experiment in June, when the government made a report to the nuclear agency after signing an additional safeguards agreement earlier in the year.
On Thursday, a South Korean delegation will depart for the IAEA's headquarters to explain the experiment and pledge transparency in its nuclear operations.
South Korea says the enriched uranium produced during the experiment was far below the amount needed for a bomb. Besides, it was enriched to only 10 percent, much lower than the 90 percent enrichment needed for bomb-making, it says.
? 2004 The Associated Press

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North Korea Nuclear Plant Suspended Again-Report
Reuters
Monday, September 6, 2004; 12:38 AM
TOKYO (Reuters) - The United States, South Korea and Japan have agreed to suspend work on the construction of nuclear reactors in North Korea for a second year but stopped short of scrapping the project, a Japanese newspaper said on Monday.
The decision, which the Yomiuri Shimbun daily said was likely to be formalized at a meeting of the Korean Peninsula Energy Development Organization (KEDO) in New York on Oct. 13, comes as Washington and its allies try to get Pyongyang to hold another round of talks this month on its nuclear arms programs.
The three countries, along with the European Union, formed the power consortium KEDO as a reward for North Korea's pledge in 1994 to freeze its nuclear development programs. The United States had agreed to provide fuel oil as part of the deal.
Quoting unidentified Japanese government sources, the Yomiuri said the United States had wanted to scrap the project entirely, but gave in to persuasion from South Korea and Japan to leave room to resume construction.
South Korea and Japan have covered 90 percent of the $1.5 billion construction costs so far.
More than 100 workers are still maintaining the site of the two partially built reactors.
KEDO suspended construction work on the light-water reactors for an initial one year last December, after the United States said in October 2002 that North Korea had admitted working on a secret uranium-enrichment project.
An attempt by North Korea to have the project restarted was rejected by KEDO's board in May.
Six-way talks between North and South Korea, the United States, Japan, China and Russia aimed at solving the nuclear stand-off have so far failed to make significant progress.
Washington has called for Pyongyang to abandon its nuclear program in a complete, verifiable and irreversible manner.
? 2004 Reuters

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Official: S. Korea Test Used Plutonium
By BARRY SCHWEID AP Diplomatic Writer
WASHINGTON (AP) - South Korea more than 20 years ago secretly conducted an experiment with traces of plutonium, a key ingredient in making nuclear weapons, a senior Bush administration official disclosed Wednesday.
The revelation follows disclosure last week that the U.S. ally had conducted four secret uranium-enrichment experiments four years ago.
North Korea responded on Wednesday to the uranium-enrichment experiments by warning of a "nuclear arms race" in Northeast Asia.
The United States, with the support of South Korea, Japan, China and Russia, has been trying to negotiate an end to North Korea's nuclear weapons program. The talks are due to resume at the end of the month, but no date has been announced.
Plutonium and enriched-uranium are the two key ingredients of nuclear weapons.
South Korea is discussing its actions with the U.N. International Atomic Energy Agency in Vienna, said the senior official, who spoke on condition of anonymity.
The administration is aware generally of the content of South Korea's reporting to the IAEA on nuclear experimental activity conducted in past years, another U.S. official said. The administration is confident the agency will thoroughly pursue any inconsistencies or questions, said the official, speaking on condition of anonymity.
Meanwhile, North Korea's envoy to the United Nations, Han Sung Ryol, told the South Korean national news agency Yonhap that it found the United States "worthless" as a dialogue partner because it applied double standards to the two Koreas. This could be a tip-off that North Korea will resist or delay efforts to halt its weapons program.
The State Department last week criticized South Korea for its secret work on uranium-enrichment while praising South Korea for working with the IAEA to make sure the program had ended.
The uranium and plutonium disclosures came amid a strenuous effort by the Bush administration to stop Iran from beginning a uranium-enrichment program that U.S. officials say could produce four nuclear weapons.
"We are in touch with the South Korean government," State Department spokesman Richard Boucher said Wednesday when asked whether South Korea had experimented with plutonium.
"We are also aware generally of what the South Koreans reported to the International Atomic Energy Agency on nuclear experiments conducted in past years," he said.
"We have confidence that the agency will pursue all these matters," said Boucher, adding that he would withhold comment "as far as other possibilities" apart from the uranium-enrichment experiments.
South Korea is in the process of verifying to the U.N. agency that its uranium-enrichment activity "has been eliminated and will not be repeated," Boucher said last week.
"But what they had done in the past was activity that should not have occurred," he said. "It's activity that must be eliminated, and we are glad that South Korea is working in a transparent manner to do that."
The spokesman said the scale of South Korea's enrichment work was much smaller than that of North Korea and Iran. And he called on North Korea to disclose its activity to the U.N. agency.
Daryl G. Kimball, executive director of the Arms Control Association, said even after South Korea ratified the Nuclear Non-Proliferation treaty in 1975, pledging not to try to develop nuclear weapons, Seoul was suspected of trying to keep nuclear options open.
It had a nuclear weapons research program in the early 1970s but the conventional wisdom was that South Korea did not acquire technology for enriched uranium or plutonium, Kimball said.
The disclosure Wednesday indicates efforts to close down the program were not completely successful, the head of the private research group said in a telephone interview.
"The devil is in the detail here, but in terms of newness I think that this probably is a surprise but it is not particularly shocking, either," he said.
Still, Kimball contrasted what South Korea had done as not an immediate problem compared to North Korea's current, active pursuit of nuclear weapons.
2004-09-08 21:03:27 GMT
Copyright 2004
The Associated Press All Rights Reserved

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>> MILITARY

A Deepening Debate on Soldiers and Their Insurers
By DIANA B. HENRIQUES
In May 2002, a young, unmarried soldier named Michael R. Deuel, serving with the 82nd Airborne division at Fort Bragg, N.C., signed up to pay nearly $120 a month for life insurance that supplemented the much less expensive coverage he had through the military.
But before he shipped out for Iraq, Private Deuel called to cancel some of his coverage because an officer on base "told him he did not need it," according to an insurance agent who served the base. A year later, in June 2003, the 21-year-old soldier was shot and killed while guarding a propane distribution center in Baghdad.
The case of Private Deuel is one of five incidents that some life insurers and their agents have offered as proof that improper meddling by senior officers is preventing young soldiers from getting supplemental insurance coverage before they head for dangerous duty abroad. By their account, thousands of other people in the military - one insurance marketing executive puts the number as high as 6,000 - have had similar experiences and are at risk of sharing Private Deuel's fate. The complaints have led to an investigation by the Government Accountability Office.
But an examination of the five cases in which young soldiers said they were dropping their insurance on an officer's advice and were later killed on duty shows that the issue is not so simple. The insurance being sold to the soldiers included policies that provided little additional coverage at high prices.
Four of the cases illustrate a little-noticed sales technique used by many insurance agents - selling military people an expensive policy in tandem with a low-cost policy. Agents who complain that soldiers have been wrongly advised to cancel policies do not distinguish between the two types of insurance. In fact, Private Deuel canceled only a policy that would have cost him $100 a month for a death benefit of $32,500, while keeping a $250,000 policy that cost him $18.75 a month.
Financial experts say that in most cases young Iraq-bound soldiers would be well advised to avoid the more costly policies, which include a savings plan as well as a death benefit, and stay with the less expensive ones, especially if they have young families.
But the insurance industry says soldiers, not their officers, should have the final say. Officers who advise troops to cancel their supplemental insurance "are hypocritical 'insurance gods' who advise lower and younger service people, who statistically are the ones losing their lives in war and are in harm's way, not to buy additional life insurance," said Richard L. Worsham of Hopkinsville, Ky., a marketing director who oversees more than 150 insurance agents serving military bases in eight Southern states and who lobbied for the G.A.O. investigation.
Mr. Worsham defended the more expensive products his agents sell as a useful retirement savings tool.
The American Council of Life Insurers, the industry's trade group, has encouraged any member companies with similar complaints about officer interference to notify the G.A.O., a spokesman said yesterday. And the issue may be raised in questioning tomorrow at a House subcommittee hearing examining whether young recruits are being exposed to high-pressure or misleading sales pitches, he said.
All service members can buy up to $250,000 in low-cost life insurance through the military, and 96 percent of them buy the maximum coverage, currently $16.25 a month. Some soldiers - those with young families or siblings, for instance - may want additional coverage, especially if they expect to serve in dangerous places.
But among the five soldiers cited by Mr. Worsham as having bought and then dropped their supplemental insurance, four of them - including Private Deuel - had actually applied for two different types of insurance, sold by the same agents at the same time, according to the application forms and other documentation provided by Mr. Worsham.
One was a simple, low-cost insurance policy offered through the Military Benefit Association, a nonprofit organization in Chantilly, Va. That policy, which pays a very low commission to the agents who sell it, gave Private Deuel $250,000 in supplemental coverage for $18.75 a month, $2.50 more than the premiums on the same coverage under his military plan. Financial planners and insurance experts say this form of coverage, called term insurance, is a good bargain for young soldiers of limited means who are seeking more coverage than they can buy through the military.
The other policy for which Private Deuel signed up was a Flexible Dollar Builder policy from the Trans World Assurance Company in San Mateo, Calif. This complex product, a form of "cash value" insurance, combines a small, expensive death benefit with an "accumulation fund" feature that allows policyholders to build interest-earning savings over time. That second policy would have cost Private Deuel $100 a month for a death benefit of $32,500.
This policy pays a large front-end commission to the selling agent. But its financial benefits to the policyholder accrue more slowly. Indeed, in most cases, the surrender value is less than the total amount paid for the product for at least a decade, even if the policyholder never has to tap into the "savings fund" for financial emergencies. Insurance experts say any cash value policy would be a poor choice for soldiers trying to maximize the amount their families would receive in the event of their deaths.
"It might very well be good advice to let the low-benefit, high-premium so-called savings program go and stay with the lower-price term insurance," said Joseph M. Belth, emeritus professor of insurance at Indiana University and editor of The Insurance Forum, an independent periodical.
In fact, Private Deuel did keep the $250,000 Military Benefit Association policy he had purchased, according to the agents who sold it to him, and canceled the more expensive Trans World policy, a choice that most financial experts would have endorsed.
Mr. Worsham also cited the case of Pvt. Marlin T. Rockhold, 23, killed by a sniper in Baghdad in May 2003, leaving a wife and her 9-year-old daughter at Fort Stewart, in Hinesville, Ga. At his death, the young private had $250,000 in military insurance, shared equally by his wife and his mother.
But eight months earlier, he had applied to buy $272,000 in additional insurance from one of Mr. Worsham's agents in Hinesville. According to the local agent, Private Rockhold canceled his application three days later, saying a noncommissioned officer at the base had told him he did not need additional insurance.
Like Private Deuel, Private Rockhold had signed up for the two types of insurance - but unlike Private Deuel, he had canceled both policies, even the low-cost one through the Military Benefit Association that would have given him $250,000 in supplemental coverage for $18.75 a month, with the entire amount going to his widow.
The other policy he canceled was a Flexible Dollar Builder from the American Fidelity Life Insurance Company in Pensacola, Fla., a sister company to Trans World. That policy would have cost Private Rockhold $60 a month for a death benefit of $22,000. Under the terms of the policy, he would not have accumulated any savings in the first year to supplement the stated death benefit, according to the documentation supplied by Mr. Worsham.
Two other soldiers on Mr. Worsham's list had also applied for both types of insurance, sold in tandem, and had also subsequently canceled both policies.
One, Pvt. Kevin C. Ott, who died in Iraq last June, had applied for just $50,000 of term insurance from the Military Benefit Association at a cost of $3.75 a month. He had also signed up for $25,000 of Flexible Dollar Builder insurance from American Fidelity for $100 a month, but had arranged to contribute an additional amount each month to the policy's accumulation fund, for a total monthly deduction of more than $158 for the second policy. Thus, he would have spent almost $162 a month for death benefits of $75,000, plus the money he paid into the second policy's savings fund before his death.
The other soldier, Pvt. Joseph Favorito 3rd, who died in a training accident in Louisiana in late 2002, had also signed up for $50,000 in low-cost Military Benefit Association coverage for $3.75 a month. His American Fidelity policy would have given him $26,000 in additional coverage, but would have cost $60 a month, none of which would have been paid into his accumulation fund in the first year.
The fifth soldier cited by Mr. Worsham was Sgt. Troy D. Jenkins of the Army, who was mortally wounded in April 2003 when he threw himself on an unexploded cluster bomb that had been brought to a group of soldiers by an Iraqi child. Sergeant Jenkins left a wife and two young children, according to military news releases.
The insurance agency that dealt with Sergeant Jenkins at Fort Campbell, Ky., sells both the low-cost Military Benefit Association term insurance, which would have provided up to $250,000 in additional benefits for his young family, and the Flexible Dollar Builder product. But according to the documents provided by Mr. Worsham, Sergeant Jenkins had applied in October 2002 for only the more expensive policy from American Fidelity, which provided $27,500 in coverage for $100 a month - and listed a friend as the primary beneficiary.
Sergeant Jenkins later canceled that policy, saying he was acting on the advice of his "chain of command," according to a letter from the local agent.
The complexities in the five cases illustrate the challenges that confront the G.A.O. study team. Mr. Worsham said that he had shipped 6,000 unconsummated insurance applications to the G.A.O. for its review, and he estimated that half of them were applications that soldiers filled out but subsequently withdrew, saying they were acting on the advice of senior officers. The other half, he said, were applications for policies that had not gone into effect because military finance offices had not processed the paperwork that would allow the soldiers to have their premiums automatically deducted from their paychecks.
Among the cases are some submitted by R. Lee Brown, a retired command sergeant major who sells insurance near Fort Hood, Tex. Mr. Brown, in a telephone interview last week, said about 50 soldiers filled out applications to buy insurance from him in March, just before they shipped out to Iraq. But so far, he said, none of their payroll deduction paperwork has been processed, leaving them without the additional insurance coverage they wanted.
The delayed paperwork may be an administrative lapse, but Mr. Worsham said he and Mr. Brown suspect that the payroll-deduction paperwork was simply "trashed" by finance officers who thought that the insurance the soldiers wanted to purchase was unnecessary. Pentagon officials have said that any military personnel found to have improperly interfered with a soldier's well-informed decision to buy supplemental insurance will be punished.
Mr. Worsham rejected the idea that officers who may have advised their troops to cancel policies may not have understood that there are some supplemental policies worth keeping, even if others are far less suitable.
Instead, he argued that many in the military establishment are prejudiced against American Fidelity and Trans World, the two companies that sell the Flexible Dollar Builder. In the late 1990's both companies and some of their agents were temporarily barred from several military bases after investigations confirmed that they had violated Pentagon rules governing the sale of insurance on military bases. Both were also sued in the late 1990's over their business practices by the Justice Department and by Florida insurance regulators; they settled both cases without admitting any wrongdoing.
Copyright 2004 The New York Times Company

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>> OUR FRIENDS THE SAUDIS


Women Denied International Driving Licenses
Abeer Mishkhas & Somayya Jabarti
JEDDAH, 8 September 2004 -- The Traffic Department has issued a law forbidding the issue of international driving licenses to all women in the Kingdom, whether Saudis or expatriates, Al-Watan newspaper reported.
In the past, Saudi women, who are not allowed to drive in the Kingdom, obtained driving licenses from other countries and using those licenses were issued international driving licenses through travel agents in Saudi Arabia.
A Jeddah travel agent told Arab News that issuing international driving licenses to women is a violation of Saudi law, and that those who do so -- he said there are those who still do -- are violating the law. He said there is nothing in writing forbidding the issuing of drivers' licenses. In other words, nothing official from the government has come to them but that it is understood among travel agencies that it is illegal to issue women with international drivers' licenses.
An agent at Al-Tayar Travel Agency said that his agency would not issue the licenses since to do so would break Saudi law. But what do women think?
Samira Al-Ghamdi, a psychologist, said: "I think such a decision needs to be studied. There are Saudi women who live or study abroad and have driving licenses in those countries. It does not make sense that when they come to renew their licenses here, they are not allowed to do so. I have a relative who got a license in Kuwait and she drives there. Such decisions are haphazard and they are not going to stop Saudi women from driving abroad."
Heba Shaikh sarcastically said: "This is only needlessly complicating women's lives. Instead of allowing us to drive here, now we are not allowed to drive abroad either. For me this means that I must go to any other country, take the driving test there and get a license which I can then use wherever I want. Except my home country of course. Honestly there are more important issues in our lives that require time and effort."
Independent women who travel on their own prefer the option of driving their own cars and this decision is going to make things difficult for them. A Saudi woman professor at King Saud University said: "I've been driving outside the Kingdom for at least 17 years. And as a mother who usually travels on my own, I do my own driving when I'm outside the country. I've renewed my driving license repeatedly. Now this is an unnecessary inconvenience. Must I now apply for a local driver's license in whatever country I travel to?"
The ban affects also non-Saudis who are not banned from driving in their own countries. Sawsan Al-Tabi, a Palestinian who works in a public relations company, normally renews her international driving license before traveling abroad in the summer but this year, she was unable to do so. "This year the travel agency refused to renew my international license even though my first license was issued in another country and despite the fact that I'm not Saudi. I don't understand. Not only are Saudi laws being forcefully and illogically applied to non-Saudis, but they're stepping over the borders to apply them."
On the other hand, some Saudi men think differently. Abu Sara, a businessman who is the father of three daughters and three sons, said: "I don't see the harm in the law. I mean it's not like women, Saudi or non-Saudi, are driving here. Come to think of it, stricter laws about issuing driving licenses should be implemented for men as well. The state of driving is bad as it is. Why would any woman be upset by this new law?"
For some women this new law is just one more obstacle. As Nouf Ahmad said: "Honestly it's like even if we leave the country, we don't really leave, do we?"
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Saudi-Pak Ties Highlighted as Fahd, Abdullah Meet Aziz
Naushad Shamimul Haq, Arab News
JEDDAH, 8 September 2004 -- Custodian of the Two Holy Mosques King Fahd and Crown Prince Abdullah held talks here yesterday with visiting Pakistani Prime Minister Shaukat Aziz on major international issues including Palestine and Iraq.
During the meeting, King Fahd highlighted the "strong and distinguished relations" between Saudi Arabia and Pakistan and emphasized the need to strengthen these ties, the Saudi Press Agency said.
Aziz conveyed the greetings of President Pervez Musharraf to the king and the crown prince. "This is my first foreign visit after becoming prime minister," Aziz said, adding that Pakistan gives utmost importance to its relations with the Kingdom.
Aziz told King Fahd: "We in Pakistan consider you as the leader and supporter of the Islamic nation." He also commended the great achievements made by Saudi Arabia over the past years.
Aziz also noted King Fahd's efforts in the expansion of the two holy mosques and the Saudi government's services to Haj and Umrah pilgrims. He emphasized Islamabad's desire to promote Saudi-Pak relations.
Earlier, Prince Abdullah held a one-on-one meeting with Aziz before hosting a luncheon in his honor. The luncheon was attended by Prince Sultan, second deputy premier and minister of defense and aviation, senior princes and top officials. Aziz held a separate meeting with Prince Sultan.
Finance Minister Dr. Ibrahim Al-Assaf met with Aziz and discussed the private sector's role in strengthening economic cooperation between the two countries.
Addressing members of the Pakistani community at the Conference Palace, Aziz vowed to pursue transparent policies and make Pakistan prosperous and an economic giant.
He said the government had devised plans to enhance productivity and reduce poverty, particularly in rural areas. Special emphasis was being given to the improvement of infrastructure, health care facilities and education. Water shortage will be overcome with the building of big dams, he said.
Aziz said the government's prudent economic policies had yielded results and the growth rate had increased to 6.4 percent. An increase of 8 percent will be possible in near future, he added.
He urged Pakistanis living abroad to project the image of the country as a progressive and modern state.
About the problems of overseas Pakistanis, Aziz said Minister of State for Overseas Pakistanis Tariq Azeem has been assigned the task of resolving them on a priority basis.
Aziz said he has very good and cordial relations with Saudi leaders as he spent most of his life in the Kingdom. He said Saudi Arabia is second home for every Muslim.
He said the government was planning to launch an Islamic bond before the end of this year which he hoped would be well received in the Middle East.
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>> LIBYA


Save Fathi Eljahmi
A Libyan dissident languishes in Gadhafi's dungeon.
BY CLAUDIA ROSETT
Wednesday, September 8, 2004 12:01 a.m. EDT
Unless someone with influence acts soon, this column must serve as an obituary for the hopes held out earlier this year of political reform in Moammar Gadhafi's Libya. More concretely, we may soon be reading obituaries for one of Libya's top democratic dissidents, Fathi Eljahmi--who is reportedly ill and in danger of dying in the hands of Libya's security police.
For anyone wondering why we should care, apart from such vague considerations as sheer human decency, the latest answer lies in the charred schoolhouse ruins and children's graves of Beslan, Russia. The only real hope of ending this global war is to replace the tyrannies that spawn terror with free societies that engender love of life, not death. In that endeavor, such democrats as Mr. Eljahmi are allies we cannot afford either morally or politically to abandon. They are our own best hope.
Jailed two years ago in Libya's notorious Abu Salim prison for advocating political pluralism and free speech in Libya, Mr. Eljahmi was released this past March, in the first happy round of U.S.-Libyan rapprochement, after Gadhafi agreed last December to give up his nuclear weapons program. Mr. Eljahmi seized the chance to speak up again for liberty, saying that Libya needed the equivalent of the political roundtable debate that in Poland, in the 1980s, helped bring democratic reform.
Less than three weeks after Mr. Eljahmi's release, and just after the freshly rehabilitated Gadhafi had hosted visits to Tripoli by Tony Blair and Assistant Secretary of State William Burns, Libyan security squads detained Mr. Eljahmi once again, along with his wife and eldest son. Although "detained" is a perhaps too polite a word for a process in which Gadhafi's thugs assaulted Mr. Eljahmi at the door of his home, then dragged him away and have since held him incommunicado.
There has been no news of his wife and son, a silence alarming in itself. But last week, a message from sources inside Libya reached a group of Libyan-Americans in the U.S., who have been campaigning for democratic reform back in Libya--the American-Libyan Freedom Alliance. One of ALFA's leaders got word that Mr. Eljahmi has been transferred to Libyan security headquarters in Tripoli, a dread place known as Zawyet Al Dahmani, which is Libya's version of the old Soviet Lubyanka. With his health fast deteriorating, the 63-year-old Mr. Eljahmi, a diabetic with a heart condition, now in the un-tender care of Gadhafi's interrogators, is reportedly in danger of dying.
ALFA itself, according to several members, has been threatened in recent months by Gadhafi. Libyan agents in various sinister ways have sent them the message that the Libyan regime has long arms and can reach them anywhere in the world. That's a threat to take seriously, given Gadhafi's long record and wide reach of murder during the 35 years since he seized power--especially if the West now contents itself by accepting his blood money and applauding his "rehabilitation" while he does to death a man like Mr. Eljahmi. The blood on Gadhafi's hands belongs not only to the victims of his regime's terrorist acts abroad, but also to his many victims inside Libya, including the hundreds of prisoners shot to death in cold blood in 1996, during a protest over hideous conditions in the same Abu Salim prison where Mr. Eljahmi was jailed from 2002-03.
Despite Gadhafi's threats, ALFA members (including Mr. Eljahmi's younger brother, Mohamed Eljahmi, a naturalized U.S. citizen) have been seeking help in obtaining Fathi Eljahmi's release, or at the very least arranging to send him medical care in custody. ALFA has sent a letter to Secretary of State Colin Powell, reminding him that President Bush specifically mentioned Mr. Eljahmi this spring as one of the important democratic voices of the Islamic world. ALFA members have made the obligatory rounds of assorted other State Department officials and congressional offices--and come up dry.
That's worth thinking about, because in theory there are plenty of forces and resources arrayed to help and protect someone like Fathi Eljahmi.
First and foremost, at least in theory, there's the United Nations, with its cozy ties between the Libyan regime and the U.N. Human Rights Commission--chaired last year by none other than Libya's current ambassador to the U.N. in Geneva, Najat Al-Hajjaji. If Her Excellency Ms. Al-Hajjaji will not rush to Mr. Eljahmi's defense (and somehow no one seems to be seriously considering that she might), then perhaps Secretary-General Kofi Annan, who last year blessed Ms. Al-Hajjaji's presence in his human rights shop, could use his U.N. world stage to say a word or two on this matter of genuine human rights.
Then there's the Bush administration, which has made liberty abroad a pillar of foreign policy, and with its newly opened U.S. mission in Tripoli is well-placed to explain to Gadhafi that the U.S. means what it says. There is of course the election season consideration that the nuclear disarmament of Libya is one of the victories of the Bush administration--which it certainly is. But that came not of Gadhafi's goodness of heart, but of his fear upon witnessing the fall of Saddam Hussein. Toadying to Gadhafi is no way to keep him in line. If an American demand for the release of Mr. Eljahmi is enough to start Gadhafi ordering up more nuclear blueprints from China, then you can bet your sweet uranium Gadhafi was going to try it anyway--and we'd be smarter to keep him running scared, rather than fat, sassy and secure.
Of course there's also John Kerry, still struggling to define his post-Vietnam foreign policy. As it happens, Fathi Eljahmi's brother is one of Mr. Kerry's constituents. What better message than for Mr. Kerry to call Mr. Bush to account and demand that if Libya's regime wants to be welcomed into the modern world--and removed from the list of terror-breeding nations--it must make room for such democratic figures as Mr. Eljahmi.
And don't forget Congress. It was Sen. Joe Biden who during a visit to Gadhafi last March asked for Mr. Eljahmi's release from prison, and was mighty proud to publicize the achievement when Gadhafi said yes. How about some follow-up, at decibel levels the fabled "Arab street" can hear, that releasing a democrat from prison is not something to be reversed as soon as Joe Biden is safely back in Washington.
Then there are the enlightened governments of Europe, which hosted a visit from Gadhafi in April. Not that anyone expects anything at this point from France. But Italy's Prime Minister Silvio Berlusconi dropped in on Gadhafi last month, and Germany's Gerhard Schroeder is slated to visit this fall. Here is ample chance to explain to Gadhafi that it is not only Americans who understand the importance of democratization.
Laughable as it sounds, even the oilmen now rushing into Libya might want to pause for a moment and consider what kind of deals they are cutting with the dictator. Not that it is necessary or even wise for businessmen as a rule to start making policy. But as far as Western businessman serve as emissaries of the democratic world, it is in their collective interest, and ours, to spell out the democratic values that let them thrive in the first place. To expect that of any one businessman may be absurd, but where is the conscience, and voice, of such outfits as the U.S. Chamber of Commerce?
Finally, there is the press--the free-wheeling outspoken Western press, so properly shocked by Abu Ghraib. When it comes to Gadhafi's secret police and dungeons, to his regime's chronic practice of disappearances, torture and murder, where is the outrage?
Which brings us back to Mr. Eljahmi. Does anyone care to imagine how much courage and conviction it takes to be a citizen of Libya, living in Libya, fully aware of the beatings and killings that continue in Gadhafi's prisons--and yet defy Gadhafi to demand democratic rule? In an interview last March, during his brief spell between imprisonments, Mr. Eljahmi told the U.S.-based Al-Hurrah Arabic TV broadcasting service that in order to democratize Gadhafi's absolute rule "I am willing to sacrifice my life. If he wants to kill me, I am ready to die for the Libyan people."
That's his choice. Ours should be to do everything in our power to help him stay alive.
Ms. Rosett is a fellow at the Foundation for the Defense of Democracies and the Hudson Institute. Her column appears here and in The Wall Street Journal Europe on alternate Wednesdays.
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>> BRIEF
Shahab 3 Missile Ready for More Testing, Iran Says
Following a successful test last month, Iran is ready again to demonstrate the Shahab 3 medium-range missile, Iranian Defense Minister Ali Shamkhani said yesterday (see GSN, Aug. 11).
"The ministry is ready to organize a new test of the Shahab 3 missile in the presence of observers," Shamkhani said in a statement carried by the official Iranian news agency IRNA. "The recent test that was carried out was a success."
The updated Shahab reportedly has a range of up to 2,000 kilometers, while the earlier version could reach no more than 1,700 kilometers, according to Agence France-Presse (Agence France-Presse/The Australian, Sept. 7).
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China confiscates semi-official report critical of N. Korea

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Report: N. Korea sought sodium cyanide used for chemical weapons

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PLA colonel executed for selling missile secrets

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S. Korea's hit TV, films, music infiltrate N. Korean airwaves



>> IRAQ

London report foresees civil war in Iraq after U.S. pullout
SPECIAL TO WORLD TRIBUNE.COM
Wednesday, September 8, 2004
LONDON - Iraq's failure to quell the Shi'ite and Sunni insurgencies will lead to a civil war with Iran's and Turkey's potential involvement, a London institute projected.
A new report said the failure by the interim government in Iraq to impose order in the country could lead to a civil war. The report by the London-based Royal Institute of International Affairs said such a war would be likely if the United States withdraws its military from Iraq.
On Tuesday, the U.S. military reported 100 Iraqi casualties in fierce fighting with Sunni insurgents in Faluja. At the same time, the military said 34 people were killed in a battle with the Iranian-backed Mahdi Army in Baghdad, Middle East Newsline reported. The military has sustained more than a dozen casualties in both engagements, and senior U.S. officials acknowledged that Iraqi cities could remain in insurgency hands until Iraq's military and security forces were capable of retaking them. "Even if U.S. forces try to hold out and prop up the central authority, it may still lose control," the report by the institute said.
The report cited several scenarios over the next 18 months. The best-case scenario envisioned government participation by the majority Shi'ite community as well as the smaller Sunni and Kurdish sectors.
But another scenario envisioned a collapse of authority throughout the country. At that point, the report said, Iran would extend its control over Shi'ite communities in Iraq while Kurds in northern Iraq would separate from the rest of the country.
"If Iraq fragments, then the neighbors cannot but become involved," the report said. "This would presage the potential unraveling of the state system that has been in place since the 1920s, and the U.S. intervention in Iraq would indeed have triggered a transformation of the region - albeit not the one hoped for under the U.S. democratization agenda."
"The enemy is becoming more sophisticated in its efforts to destabilize the country," Gen. Richard Myers, chairman of the Joint Chiefs of Staff, said on Tuesday. "And recently, we've seen an increase in the number of suicide attacks."
The British report did not envision a dominant role for the U.S. military. It saw the military as providing increasing responsibility to the new Iraqi armed forces.
But the institute appeared to doubt the effectiveness of any interim Iraqi government or its security forces. Under the worst-case scenario, Iraq would become a haven for Al Qaida-inspired insurgents, including those fighting the royal family in neighboring Saudi Arabia.
At the same time, the mixed city of Kirkuk would descend into civil war, pitting Arabs against Kurds. The report said this could trigger Turkish intervention.
Copyright ? 2004 East West Services, Inc.

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09.08.04
http://www.tnr.com/blog/iraqd?pid=2041
"IRAQ WILL NOT BE A 'SUCCESS' FOR A LONG TIME": Passing the horrible milestone of the thousandth soldier killed in Iraq conveys a responsibility to reassess the policy that led to it. Right now, the occupation of Iraq is rudderless, defined more by drift than design. That drift is the result of the sheer confusion of President Bush. In his convention speech last week, the most specific the president got in describing the course he is endlessly asking the country to stay was this:
So our mission in Afghanistan and Iraq is clear: We will help new leaders to train their armies, and move toward elections, and get on the path of stability and democracy as quickly as possible.
Leave aside for a moment the numerous differences between Afghanistan and Iraq. What Bush offered in New York was a series of vague goals, not a strategy. Nor did he give any indication of how he understands "stability" and "democracy," the end state of the mission he blithely described as "clear." For example, will "democracy" mean simply the advent of elections--even elections extremely unlikely to be free or fair? Furthermore, does the president believe that current policy in Iraq, whatever that is, is succeeding? Are the casualty figures to be expected and endured because the policy is yielding results, as Donald Rumsfeld strangely suggested at his press conference yesterday--even as he and General Richard Myers conceded that the number of trained-and-equipped Iraqi security forces, the linchpin of the United States's plan for stability, stands at less than half of the 200,000-troop figure Rumsfeld has cited for months? (What's more, according to Myers, those forces won't truly be ready to take on security duties until the end of the year, calling into question what exactly the figure of 95,000 uniformed Iraqis really means.)
Given this strategic confusion, measuring progress or backsliding in Iraq policy is a difficult enterprise, filled with often-contradictory information. This morning, Rick Barton and Sheba Crocker of the Center for Strategic and International Studies (csis) released the long-awaited results of an ambitious research project aimed at synthesizing a trove of data on Iraq, titled "Progress Or Peril?: Measuring Iraq's Reconstruction." The csis researchers analyzed hundreds of media reports in four languages; over 300 data points from official U.S. documents; 16 public opinion polls stretching back to August 2003; and interviews with 700 Iraqis across 15 cities conducted June 12-27 of this year. The purpose of sifting through this extraordinary amount of information was to quantify on multiple levels whether Iraq had reached "tipping points" across five key areas of measurement: security; governance and participation; economic opportunity; access to basic services like electricity and water; and social well-being. These tipping points were not overly ambitious. In the governance sector, for example, it meant analyzing whether a typical Iraqi citizen could affirm, "I am free to vote"; in the security sphere, it meant whether he or she could say, "I travel throughout my community, avoiding only areas that are known to be dangerous."
The results are grim. "Iraq is not yet moving on a sustained positive trajectory toward the tipping point or end state in any sector," they write. When the survey's authors graph their findings from June 2003 to July 2004, the lines skew confusedly and double back to where they began: "In fact, in every sector we looked at, we saw backward movement in recent months." To paraphrase the president, csis has found that not only haven't we turned the corner, we are very likely going back.

Among csis's more interesting findings:

--Contrary to the endless bashing of Iraq press coverage by the administration, "the media has not been significantly more negative than other sources of information on the issues of security, governance and participation, and economic opportunity. The media has been regularly more negative than other sources about services and social well-being issues. But in those areas, the media is arguably more balanced than public sources, in that it tends to include descriptions of the impact of security and reports of the Iraqi perspective."

--As for the typical metric of success used by the administration--the number of schools or hospitals built by U.S. forces: "It is possible to recognize progress in certain areas (e.g., number of hospitals rebuilt) while also concluding that it is insufficient, overshadowed by massive remaining hurdles, or not making a quantified or qualified difference to Iraqis. The U.S. efforts thus far have been largely divorced from the Iraqi voice and undermined by security problems and the lack of jobs and they are not leading toward entrenched sustainability of Iraqi capacity."

--Csis's latest round of interviews in Iraq--among 700 Iraqis in 15 cities--occurred from June 12-27. As contemporaneous polls conducted for the CPA and Oxford Research International found, those waning days of the CPA produced a honeymoon period for the embryonic administration of Iyad Allawi. But even during the honeymoon, csis found, "Governance and Participation is a largely negative picture, despite a slight boost in optimism related to the June 28 transfer of sovereignty. ... Most are willing to give their government a chance, although they continue to question its credibility." While polling during this time typically confirmed the honeymoon, the interviews csis conducted did not: "On the basis of the interviews alone, however, Iraqis seem to feel they have marginal influence over a government that is somewhat credible. This was the only issue on which not one of the towns we interviewed passed the tipping point."

--The Sunni and Shia insurgencies have already overwhelmed the U.S. and the Allawi government. Now, csis warns, "U.S. and Iraqi officials ignore the undercurrent of disaffection in the north at their peril. ... As recent violence in Mosul shows, that city is a ticking time bomb ... Kirkuk is a similar worry." In Kurdistan, a population that once expressed high levels of confidence in the developing political situation is growing disillusioned with the PUK and KDP leadership, as well as with the U.S., largely due to the administration's refusal to secure United Nations approval for the federalism and autonomy guarantees in the interim constitution.

The study's authors bring a tremendous amount of credibility to this project. In July 2003, a csis delegation that studied conditions in Iraq at the behest of Rumsfeld and Paul Bremer issued a remarkably prescient report highlighting the pitfalls of the administration's dual strategy of unilateralism and Iraqification, the rapid deterioration of security conditions, and its dire implications for success in the political and economic dimensions of reconstruction. (Both Barton and Crocker were part of the csis team.) That early report, which warned of a three-month window of opportunity for the U.S. occupation, went essentially unheeded.
Now, csis issues a new set of recommendations, ranging from accelerating the training of Iraqi security forces to prioritizing development of the Iraqi justice system to renewing efforts at internationalizing the occupation. But the researchers candidly identify a crucial complicating factor: the very fact of the U.S. occupation: "[T]he United States should expect continuing resentment and disaffection even if the U.S.-led reconstruction efforts seem to be making positive, incremental improvements to the country according to quantifiable measures. In other words, the occupation will not be judged by the sum of its consequences, but rather qua occupation."
Csis has done something that President Bush has never done and probably will never do with the American people when it comes to Iraq. It gives them the tools to assess the policy, and then levels with them:
Iraq will not be a "success" for a long time. In fact, one thing this project highlights is the difficulty in defining success at all. It is better to focus on catalyzing Iraq's recovery by concentrating on a series of measurable benchmarks, like those laid out in the report, and setting Iraq on the right trajectory to meet those benchmarks. Setting our sights on realizable benchmarks instead of on defining a U.S. exit strategy will be more beneficial for Iraq, and suggest achievable goals for the United States.
If the administration had listened to csis in July--or to the numerous government officials who studied a potential occupation of Iraq in 2002--perhaps we wouldn't have come to this awful point. But here is where President Bush has taken us, and from the very beginning to last week, he has proven himself incapable of taking us forward.
posted 10:04 a.m.

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Bushmaster, Bull's Eye Settle for $2.5 Million in D.C. Sniper Shootings Lawsuit

By Rebecca Cook Associated Press Writer
Published: Sep 8, 2004
SEATTLE (AP) - The manufacturer and dealer of the rifle used in the Washington, D.C.-area sniper shootings agreed Wednesday to pay $2.5 million in a settlement with victims and victims' families.
The settlement with Bushmaster marks the first time a gun manufacturer has agreed to pay damages to settle claims of negligent distribution of weapons, said Jon Lowy, a lawyer with the Brady Center to Prevent Gun Violence. He helped argue the case. He said the settlement with Bull's Eye Shooter Supply is the largest against a gun dealer.
"These settlements send a loud and clear message that the gun industry cannot turn a blind eye to how criminals get their guns," Lowy said.
Bushmaster Firearms of Windham, Maine, agreed to pay $550,000 to eight plaintiffs. Bull's Eye Shooter Supply of Tacoma, where the snipers' Bushmaster rifle came from, agreed to pay $2 million.
Kelly Corr, the attorney representing Bushmaster, said the company made "no admission of liability whatsoever."
He said Bushmaster and its insurance company, which will pay the $550,000, decided to settle rather than continuing to run up legal fees in court. Corr said the settlement will not change the way Bushmaster conducts business.
"Bushmaster believes it is a responsible manufacturer," he said.
As part of the settlement, though, Bushmaster agreed to educate its dealers on gun safety.
A lawyer representing Bull's Eye did not immediately return calls for comment Wednesday night.
A judge will determine how to divide the settlement among two people who were injured in the shootings and the families of six people who were killed.
John Allen Muhammad, 43, was convicted and sentenced to death for murder in one of the 10 fatal shootings in October 2002 in the Washington, D.C.-area. His co-conspirator, 19-year-old Lee Boyd Malvo, was tried separately, convicted of murder in a different death and sentenced to life in prison without parole.
They used a .223-caliber Bushmaster rifle, a civilian version of the military M-16.
The civil lawsuit alleged that at least 238 guns, including the snipers' rifle, disappeared from the gun shop in the three years before the shooting rampage. Despite audits by the Bureau of Alcohol, Tobacco and Firearms showing that Bull's Eye had dozens of missing guns, Bushmaster continued to use the shop as a dealer and provided it with as many guns as the owners wanted, the lawsuit alleged.
"It appears that 17-year-old Malvo was able to stroll into this gun store and stroll out carrying a 3-foot-long, $1,000 Bushmaster assault rifle," Lowy said. "Bull's Eye should have taken reasonable care to prevent guns from being stolen. Bushmaster should have required Bull's Eye to implement simple, reasonable security measures."
Seattle attorney Paul Luvera represented the victims' families. He called the settlement "historic" and said it should change practices in the firearms industry.
"When a manufacturer makes a large settlement like this one, it is an example to other manufacturers," Luvera said.
The victims' lawsuit, filed in January 2003, also names Malvo and Muhammad as defendants. Those claims are technically still pending, though they are unlikely to be resolved.
A bill was proposed in Congress earlier this year that would have given the firearms industry immunity from lawsuits such as this one. Despite strong support from President Bush, it died in the Senate.
On the Net:
www.bushmaster.com
www.bradycenter.org
AP-ES-09-08-04 2302EDT
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Nov. 13, 2001 Air Crash over New York Was Work of Al Qaeda Suicide, Says Canadian Intelligence
DEBKAfile Special Report
August 30, 2004, 10:30 PM (GMT+02:00)
According to a top secret Canadian government report, the 9/11 terrorist attacks on New York, had a sequel two months later. On November 13, 2001, American Airlines flight 587 crashed over Queens, New York, shortly after takeoff from JFK killing all 265 people aboard. A captured al-Qaeda operative, Mohammed Mansour Jabarah, told Canadian intelligence investigators that a Montreal man who trained in Afghanistan alongside the 9/11 hijackers was responsible, using a small shoe bomb similar to the one used by convicted shoe bomber Richard Reid for his "suicide mission." He named Abderraouf Jdey, a Canadian citizen known also as "Farouk the Tunisian."
This is reported in Canada's National Post
Asked for a comment, US National Transportation Safety Board spokesman, Ted Lopatkiewicz, still insisted there was no evidence of anything other than an accident (in the plane crash over Queens.) It appears, at least the evidence we have, is that a vertical fin came off, not that there was any kind of event in the cabin."
The same kinds of claims were made officially three years ago too. Yet on November 15, 2001 DEBKAfile's counter-terror sources maintained that the downing of Flight 587 was the work of terrorists:
The Information accumulating opens up the possibilities of a bomb having been planted near the tail of the Airbus, or a suicide bomber blowing himself up in the rear of the aircraft. The plane came down shortly after taking off for the Dominican Republic from John F. Kennedy International airport. Another scenario under investigation is that a surface-to-air missile was fired from a boat in Jamaica Bay near the airport.
According to DEBKAfile's intelligence sources, a number of people linked to Al Qaeda in New York behaved suspiciously several hours before the crash; some, who were under surveillance following the September 11 attacks, managed to disappear, with the FBI unable to determine how they slipped away or trace their current whereabouts.
Those sources also noted that the US F-15 warplanes, on 24-hour patrol in the skies of New York and other major US cities, were ordered immediately after the crash to search for any boats or unusual activity in the Jamaica nature reserve.
The morning after, Wednesday, November 14, divers were seen scouring the marsh area for signs that missiles had been fired at the plane, such as a launcher or a scuttled boat, on the assumption that the terrorist who fired the missile escaped in a scuba suit.
Despite adamant denials by the US Federal Aviation Authority, it is now becoming clear that prior to the crash, US intelligence did indeed receive numerous warnings from intelligence sources outside the United States that a terrorist strike was likely on Tuesday, Veterans Day, to mark the two-month anniversary of the attacks on the World Trade Center and Pentagon. (End of quote)
According to the US 9/11 commission, Jdey, 39, came to Canada from Tunisia in 1991 and become a citizen in 1995. With his new passport, he left for Afghanistan and trained with some of the September 11 hijackers. He was dropped from the 9/11 mission after recording a "martyrdom" video. Khalid Sheikh Mohammed, planner of the World Trade Center attack, claims Jdey was recruited for a "second wave" of suicide attacks. In 2002, he was one of seven al Qaeda members sought in connection with possible terrorist threat in the United States.

Posted by maximpost at 11:58 PM EDT
Permalink
Friday, 3 September 2004


N. Korea to Conduct Nuke Test in October?
Grand National Party Lawmaker Park Jin, who is currently attending the U.S. Republic Party national convention, said Thursday that North Korea may conduct a nuclear experiment in October, and this intelligence was quietly making its way around Washington political circles. Moreover, a high-ranking U.S. government official recently met with a North Korean diplomatic official in New York and official conveyed concerns over this intelligence, Park said.
While he was visiting the headquarters of the New York-based Wall Street Journal on Thursday, too, Park was asked by a high-ranking member of the paper's editorial staff whether he knew of the "October Surprise." The editor said that talk of a North Korean nuclear test in October was going around Washington political circles and high-ranking government officials, and such talk had even made it to the New York media.
Park said that through inquiries to high-ranking U.S. Defense Department officials and White House beat reporters from major media companies, he was able to reconfirm that such talk was, in fact, going around.
Park did not reveal who conveyed U.S. concerns to North Korea through New York diplomatic channels, but he did say that a high-ranking U.S. government official officially expressed concern over a possible "October Surprise," and North Korea showed no response.
(englishnews@chosun.com )
http://english.chosun.com/w21data/html/news/200409/200409030023.html
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>> MORE CHOSUN...


IAEA Inspection Finds Nothing Unusual
As an International Atomic Energy Agency (IAEA) inspection team is conducting a weeklong investigation on the uranium enrichment experiment, it was confirmed Friday that the IAEA had actually visited Korea last year.
"IAEA had requested cooperation in visiting the Korea Atomic Energy Research Institute last year, and we affirmed the request," said Cho Chung-won, director-general of Nuclear Energy Cooperation in the Science and Technology Ministry on Friday. "However, I cannot share the specific content of the inspection because of the pact between IAEA and the government," he added. Only one inspector came last year.
Cho said, "This incident was first reported to the Ministry of Science and Technology in June, and the Korean government reported it to the IAEA on Aug. 17... The IAEA inspection team is here to confirm the report we have sent in August."
The IAEA inspection team will leave the country Saturday, a day before the scheduled departure date.
Cho said, "the IAEA inspection team has been probing the uranium experiment from last Sunday, and has confirmed that there were no discrepancies in our report. They will leave Korea on Saturday." The IAEA had prescheduled to continue the inspection through Saturday.
(englishnews@chosun.com )



Gov't Explains Nuclear Experiments
WASHINGTON, D.C. -- Science and Technology Ministry Atomic Power Bureau chief Cho Chung-won said Thursday, "In January and February of 2000, during research on separating radioactive materials at Korea Atomic Energy Research Institute, 0.2g of enriched uranium was separated from natural uranium... We reported this to the IAEA on Aug. 17." Accordingly, an IAEA inspection team has been in Korea since Aug. 27 conducting inspections; it will continue its work until Saturday.
The Science and Technology Ministry said, "The uranium enrichment occurred incidentally during the course of an experiment to separate gadolinium, a material used to slow down nuclear reactions in nuclear power stations. As gadolinium separation proved uneconomical, the equipment related to the experiment was dismantled and the experiment suspended."
About this, U.S. State Department spokesman Richard Boucher said in a regular briefing Thursday, " I would say that South Korea has voluntarily reported this activity. [What happened shouldn't have occurred, but] they are cooperating fully and proactively in order to demonstrate that the activity has been eliminated and it is no longer cause for concern." He added that he didn't believe the matter would influence the fourth round of six-party talks on the North Korean nuclear issue scheduled for late September.
(Kang In-sun, insun@chosun.com )



Gov't Must Quickly Eliminate Uranium Suspicions
Following the revelation that the Korea Atomic Energy Research (KAER) conducted experiments to enrich uranium four years ago, some foreign press agencies have raised suspicions that Korea attempted to develop nuclear weapons.
Many countries, however, possess the technology to concentrate radioactive isotope material using lasers. The KAER also did the experiment to separate materials for medical purposes, but found out that it was uneconomical and thus suspended the experiment. About this, the research team said that just before dismantling the equipment related to the experiment, it experimented out of an investigative mind to see whether it was possible to enrich uranium using lasers like it was in theory.
It requires 15 kg of uranium to build nuclear weapons, but the amount of enriched uranium produced in the KAER's experiment was only 0.2 kg. This means that it needs to repeat the same experiment hundreds of thousands of times to build a single nuclear weapon. Then, it is preposterous to escalate the issue to suspect that Korea might develop nuclear weapons.
Moreover, Korea voluntarily reported the experiment. At the time of the experiment, the facilities of the KAER were not on the list of the inspection of the International Atomic Energy Agency (IAEA) and the KAER was not obliged to report its activity. Then this February, Korea rectified an additional protocol on safety measures by IAEA, which requires experiments for research purposes to be reported as well. Thus, the government came to report the experiment conducted four years ago. In addition, the U.S. State Department spokesman said about the issue, "Korea is cooperating fully and proactively in order to demonstrate that the activity has been eliminated and it is no longer cause for concern."
The most worrying thing is that using the issue as an excuse, North Korea may refuse to hold six-way talks to resolve its nuclear issue. If Korea had attempted to develop nuclear weapon technology, the KAER would not have dismantled the equipment after experimenting only once. The government should try to resolve suspicion raised by the international community as soon as possible by clearly explaining the issue in detail to the IAEA inspection team. The longer such an issue remains unresolved, the more unnecessary speculation will be raised.



Gov't Decries Foreign Press Exaggerations of Nuke Fuel Experiments
The government is cautioning against a possible stir caused by foreign press "exaggerations" concerning experiments that resulted in the extraction of a minute quantity of uranium.
This is because after the government announced Thursday that some scientists had separating a minute amount of uranium during the course of research in January and February 2002, major foreign press agencies like Reuters, AP and AFP focused on trying to ascertain the government's intention and involvement rather than purely reporting the facts. The government also pointed out that the level of suspicion raising had crossed a line.
Reuters emphasized that the government may have been involved, saying that while the amount of uranium produced was small, its enrichment was "very close" to weapons-grade, and while the Korean government was saying it didn't know what was going on at the time of the experiments, the scientists were government employees working at a government-run research center. AP went as far as to quote Daryl G. Kimball, executive director of the Arms Control Association, as saying, "We cannot afford to have another whitewash... This incident should lead to a reevaluation of U.S. export control laws on nuclear technology," while AFP reported, "The United States called for a thorough probe into ally South Korea." Their attitude seemed like one looking to escalate the issue into a source of tension between the U.S. and Korea.
About this, a government official, failing to repress his displeasure, said, "We received a belated report about an experiment to separate a minute quantity of uranium that took place four years ago, and to avoid any unnecessary misunderstandings, we reported it immediately to the IAEA and even publicly pledged to prevent such an incident from recurring, but some foreign press agencies are driving the story in a provocative way."
It required 15kg of uranium to build the bomb that was dropped on Hiroshima, but with current technology, it's known one could produce a weapon with only 5-6kg of uranium. Accordingly, Korean nuclear experts say 0.2g wouldn't be enough for even a test sample.

(englishnews@chosun.com )


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Foreign Press Raise Concerns About Nuke Experiments
In connection with Korean scientists' uranium enrichment experiment, the Japanese media has shown the most sensitive response. The Asahi Shimbun extensively covered Korea's uranium test on the first, second and third page. The Yomiuri Shimbun also reported it on the first page on a large scale.
The Asahi Shimbun harshly criticized the South Korean government in its editorial entitled "Surely Not in South Korea?" saying that the experiment goes against the nonproliferation declaration on which North Korea agreed and South Korea has lost a justification to require North Korea to abandon its nuclear weapons development. The newspaper raised a doubt, saying it could not understand the South Korean government announcement that it did not know about the nuclear test. Recent nationalistic tendencies in Korea might be behind the nuclear experiment, analyzed the Asahi Shimbun.
Major U.S. media companies like the New York Times and the Washington Post raised a suspicion that the South Korean government might have been involved in the nuclear experiment, saying that the uranium extraction using lasers was used mainly in weapons development programs driven by governments because it was very difficult and took a huge amount of money.
The U.S. media said that this case in which a U.S ally had violated the nonproliferation treaty with confidential nuclear-related activities was embarrassing to the Bush administration, which was attempting to strengthen international pressure on the secret nuclear development of North Korea and Iran.
The Asian Wall Street Journal analyzed that North Korean leader Kim Jong-il is certainly smiling while calculating what benefit he would gain though the South Korean nuclear test. It raised a suspicion over the possible involvement of the South Korean government by quoting a U.S. official as saying that South Korea's moderate leftist former government and incumbent government might have approved the nuclear test.
The British Financial Times analyzed that the nuclear test might be caused by situational factors, saying that there were similarities between the situation in the 1970s when South Korea had embarked on nuclear development and the current situation in which the number of U.S. troops stationed in Korea were reduced and Korean-U.S relations were strained.
Concerning the South Korean government's voluntary report, international media companies refuted the South Korean government's argument that it had voluntarily reported the test to the International Atomic Energy Agency (IAEA), saying that IAEA inspectors had been banned from entering the institute and South Korea had admitted the test only after inspectors had raised questions concretely pointing at equipment in the institute.
(englishnews@chosun.com )




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South Koreans Say Secret Work Refined Uranium
By DAVID E. SANGER and WILLIAM J. BROAD
The South Korean government has admitted to the International Atomic Energy Agency that a group of the country's scientists secretly produced a small amount of near-weapons grade uranium, raising suspicions that South Korea may have attempted a secret program to counter North Korea's nuclear arsenal.
The revelation, made 11 days ago and disclosed by the agency yesterday, could greatly complicate the confrontation with North Korea over its own nuclear weapons program. President Bush regularly calls for a "nuclear-free Korean peninsula," and those calls have been endorsed by South Korea, one of Washington's closest Asian allies.
In a statement, the South Korean government said the highly enriched uranium was produced by a group of rogue scientists in 2000, without the knowledge of the government. But many details of the effort, which was an apparent violation of the Nuclear Nonproliferation Treaty, remain murky, and the method the scientists used was so expensive that it is normally associated with government-directed weapons programs. Richard A. Boucher, the State Department spokesman, said yesterday that it "is important that all such activity be investigated," adding that after the I.A.E.A. completed a review the United States "will be able to draw the appropriate conclusions."
According to international diplomats with knowledge of the South Korean disclosure, the government admitted to the experiment only after energy agency inspectors began asking pointed questions about a piece of equipment in a building in Taejon, a South Korean scientific center, that they had been barred from visiting. It was unclear how they had learned of the existence of the equipment. "It became clear to the South Koreans that there would be environmental samples taken, and the truth would be discovered," one of the diplomats said. "So they decided they better disclose it first, themselves." That disclosure took place on Aug. 23. The South Korean government has not yet explained how it learned of the work of the scientists.
While the amount of uranium that South Korea has admitted to enriching was very small, about two-tenths of a gram, it was enriched to nearly 80 percent - a level so high that experts said it was difficult to imagine that it would be useful for anything other than making nuclear weapons. It would take several kilograms to make even a crude nuclear weapon. When it was disclosed last year that Iran used a similar method to try to enrich uranium - though with significantly larger quantities - the Bush administration said that effort was clear evidence that Tehran was seeking to build a nuclear weapon.
Mr. Boucher declined to draw that conclusion on Thursday about South Korea, noting that it had disclosed its own violation. But a team from the International Atomic Energy Agency was rushed to the country last week, and is now conducting tests to determine if the country has fully disclosed what it produced.
South Korea recently agreed to a set of more intensive inspections by the agency, and the inspectors were in the country to perform them.
It was unclear whether the scientists who were involved in what South Korea called a "laboratory experiment" were government employees or workers for the country's civilian nuclear industry. A South Korean government statement said the experiment was intended for research on civilian fuel production, but outside experts said that seemed improbable.
There was no response yet from North Korea, and Mr. Boucher said it was not clear that the discovery would hinder the diplomatic effort to pressure the North to disarm. But several other administration officials disagreed, saying the disclosure would probably have significant propaganda value for the North, which withdrew from the nonproliferation treaty 18 months ago. It can now claim that the South had also introduced weapons-grade material to the Korean peninsula.
North Korea is estimated to have enough plutonium to produce two to eight nuclear weapons, and Washington has accused it of having a second, secret uranium enrichment program of its own. North Korea denies it has such a program.
At the time of the South Korea experiment in the year 2000 - which Seoul insists was never repeated - the country was led by President Kim Dae Jung. Mr. Kim was known for his "sunshine policy" of seeking increased engagement with the North, and traveled to North Korea the same year that the enrichment experimentation reportedly took place. "I would doubt it is anything that Kim Dae Jung condoned," said Donald P. Gregg, a former American ambassador to South Korea. "But that doesn't mean it hadn't been condoned by some previous government" or parts of the military.
The method chosen by South Korean scientists to enrich uranium, through the use of lasers, is considered easy to hide. Though pioneered by the United States and pursued for decades around the globe, laser enrichment appears to have remained a laboratory curiosity. "None of the big players use lasers," said Thomas B. Cochran, a senior scientist at the Natural Resources Defense Council in Washington, a private group that tracks nuclear arms. "They all use centrifuges, " referring to the devices that concentrate uranium by spinning it at high speed. Low levels of enrichment are necessary for electricity production; high levels can be used for weapons.
To date, the laser technique has been so expensive that experts assume its only usefulness would be for a military program where costs are no obstacle. It uses different colors of laser light to separate different forms of the same element, like uranium 238 from uranium 235, which in atomic reactions easily splits in two in bursts of energy.
"Given its lack of commercial application, the only conclusion you can reach is that any nation pursuing this technology is doing it for military uses," said Paul Leventhal, president of the Nuclear Control Institute, a private group in Washington that has campaigned against nuclear facilities whose waste could be used for weapons.
Last year, the International Atomic Energy Agency revealed that Iran had worked in secret for 12 years to develop lasers for purifying uranium. In a report, it said Iran established a pilot plant for laser enrichment in 2000 and used it from October 2002 to January 2003 to conduct experiments. The Iranian authorities said they disassembled the plant in May 2003.
Mr. Leventhal of the Nuclear Control Institute said the laser technology was so costly and difficult that only governments had the means to try to exploit it, undermining South Korea's disavowals about unsupervised scientists doing the experiments on their own.



Copyright 2004 The New York Times Company |
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Beijing pressing pro-China buttons in Bush's NSC
China is stepping up pressure on the Bush administration to block all sales of arms to Taiwan until after the November presidential elections. Beijing's position has covert allies in Douglas Paal, the U.S. government representative in Taiwan, and Dennis Wilder, a pro-China CIA analyst recently named to the White House National Security Council staff...

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China takes delivery of 24 Sukhoi fighters
China's People's Liberation Army-Navy has now gotten 178 Sukhoi fighter jets from Russia in 10 years...

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Japan documents 28 recent incursions of PRC ships into territorial waters...

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Secret life and death of Kim's Japanese-born wife/mistress starts power struggle for communist throne...
Pyongyang to expel NGOs suspected of spying, using Christianity to subvert regime...

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The Latin Americanization of China?
GEORGE J. GILBOY AND ERIC HEGINBOTHAM
256
Wide-ranging liberal market reforms have produced rapid gains in China's overall economic growth over the past two decades. Yet rural policy since 1978 has been rent by opposing influences: the state recognizes the growing plight of farmers facing market reforms, but it refuses to accept rural migrants as full members of urban communities. Today, however, China's leaders are deepening land reform programs in the countryside. Reformers hope this will spur consolidation of land into larger, more efficient agricultural holdings while encouraging inefficient farmers to divest their land, leave the countryside, and help fuel healthy industrial growth by selling their labor in China's burgeoning cities.
As Karl Polanyi, the author of the 1944 study, The Great Transformation, could have predicted, this process is not going smoothly. Although Polanyi was describing the enclosure movement and subsequent social, economic, and political crises in eighteenth-century England, many common themes are now being played out in China's own great transformation, including worsening inequality, rising expectations, and increasing conflict and violence in the countryside. Yet the current crisis in the countryside is only a precursor to the deeper and more fraught crisis that is growing in China's cities. China's economic reforms have created what Sun Liping of Tsinghua University calls a "cloven society." The new richand powerful now live in walled, guarded villas and modern apartment complexes, enjoying vast differences in wealth, power, and rights from the swelling ranks of the rural poor and urban dispossessed. The latter are composed of millions of migrant workers living in shantytowns, alongside the growing numbers of urban unemployed and low-income residents who are being forcibly removed from the city center to make way for new real estate development. This second, developing crisis is not only a crisis of infrastructure and incomes--the hardware of urban life. As millions of peasants seek a permanent home in China's cities, it is also a battle for identity and entitlements--the critical software that makes urban society workable. These "urban rights" include legal status and accompanying access to jobs, education, health services, insurance, and social welfare benefits.
The outcome of this second crisis, though it will certainly involve increasing scope and intensity of conflict and confrontation, need not be endless discord or regime collapse. China's tumultuous reform process could see the creation of new, more liberal legal and social institutions. Transforming migrants into urban citizens with equal rights and allowing social groups to organize and articulate their own interests would both improve the ability of the government to govern effectively and minimize longterm threats to stability and economic development. But other outcomes are also possible. The state could refuse to allow liberal institutional innovation and slip into a modern form of authoritarian corporatism in which political leaders might seek to channel social energies toward nationalist ends-- the "revolution from above" about which Barrington Moore warned. Or alternatively, China could catch the Latin American disease, characterized by a polarized urban society, intensifying urban conflict, and failed economic promise. Indeed, despite aggressive efforts to make the state more responsive and adaptive, the speed with which social cleavages and conflicts are growing today arguably makes this last outcome easier to imagine than the others.
GEORGE J. GILBOY is a research affiliate at the Massachusetts Institute of Technology's Center for International Studies. ERIC HEGINBOTHAM is a senior fellow at the Council on Foreign Relations.
THE SUFFERING COUNTRYSIDE
China's rural areas are now deep in crisis, with sluggish income growth, peasants burdened by excessive taxes and fees, and local governments overstaffed, in debt, and unable to provide adequate services for peasant families. Rampant corruption among local officials has combined with these factors to incite increasing levels of peasant organization, protest, and violence. This crisis is not new, but it is reaching a new scale and intensity. In a 2004 Chinese Academy of Social Sciences (CASS) survey of 109 of China's top sociologists, economists, managers, and legal experts, 73 percent of the respondents identified the "three rural problems" (san nong wenti) of agriculture, peasants, and rural areas asChina's most urgent challenge. Combined with other issues such as corruption, the intensity of the rural turmoil led more than half of the respondents to see a systemic crisis as "possible" or "very possible" within the next 5 to 10 years.
Small-scale inefficient agriculture and the relative decline of township and village enterprises are contributing to a widening rural-urban income gap. Average annual rural income stands at just $317 today, and the gap between urban and rural income has grown from 1.8:1 in the mid-1980s to 3:1 in 2003. Between 2000 and 2002, incomes fell in 42 percent of rural households in absolute terms. And according to a July 2004 government report, the number of farmers living under the official poverty line of about $75 per year increased by 800,000 in 2003, the first net annual increase in absolute rural poverty since economic reforms began in 1978. At the same time, farmers suffer from a disproportionate tax burden while receiving fewer services; according to the State Council's Development Research Center, the urban-rural income disparity soars to between 5:1 and 6:1 when entitlements, services, and taxes are included in the calculation. Unsurprisingly, organized rural protest is on the rise. Actions range from tax evasion and blocking roads and railways to the assault or kidnapping of officials and even to riots that have involved hundreds or thousands of people. Even so, the nature of rural protest and of the state's response to it limits the possibility that rural conflict alone could threaten regime stability. As Yu Jinrong of CASS notes, when rural residents do engage in collective action and protest, they often seek alliances with central government officials against local officials, rather thanseeking broad-based systemic change. Yu argues that today's peasants are not the revolutionary "peasants of Mao." They are seeking legitimate political organization to defend legitimate economic interests, and, he warns, suppressing their aspirations and organization carries significant political risks.
Beijing has been highly attuned to rural problems for the past several years, and has taken steps to address them. In particular, the central government has had some short-term success in reducing the peasant tax burden by cracking down on illegal local fees and converting fees to more transparent taxes. It also has moved to share a larger amount of central revenue with local governments. The central government has created more safety valves for expressions of rural discontent, clamped down on abuses by local officials, explained policies to peasants, paid out monies to mollify protesters, and allowed village elections (although it has also simultaneously removed considerable tax and fiscal power to the higher township level, not subject to elections). These measures are, however, also creating a strong sense among Chinese citizens that they have "legal rights." Rural residents increasingly refer to these "rights" in their protests--a potentially significant development for the future of Chinese politics. And, despite the government's success in localizing, suppressing, or conciliating potential rural threats, the leadership does not believe that such measures represent a real long-term solution to the san nong wenti.
THE GREAT ENCLOSURE
Many key Chinese policymakers and social scientists believe the solution to the rural crisis lies in amore radical approach: a combination of land reform, industrialization, and urbanization. Wang Mengkui, the director general of the State Council Development Research Center, argues, "Too many people and too little land makes large-scale production difficult and is therefore the greatest problem for farmers to increase their incomes." The consolidation of larger farms and the movement of farmers to the cities will go far toward solving the rural problem, he asserts, and as an additional benefit of urbanization, "large numbers of migrant workers [will] supply cheap labor, thus helping to enhance the international competitiveness of Chinese industries." Pan Wei, an influential government adviser and Beijing University professor, also argues that Beijing should encourage a rapid acceleration of peasant migration to urban centers, proposing that China should develop an additional 100 cities of 5 million people or more over the next 30 years, either by building new cities or expanding existing ones. The migration from country to city, already massive,is accelerating. In part, this is being driven by The Latin Americanization of China? * 257
illegal land seizures and the conversion of farmland to industrial and recreational use. In November 2003 the Ministry of Land and Resources reported more than 168,000 cases of illegal land seizure, twice as many as in the entire previous year. According to the State Statistics Bureau, China lost 6.7 million hectares of farmland between 1996 and 2003--three and a half times as much as the 1.9 million lost between 1986 and 1995. The trend continues to accelerate, with some 2.53 million hectares, or 2 percent of total farmland, lost in 2003 alone. According to the 2004 Green Book of China's Rural Economy, for every mu of land (approximately 0.07 hectares) that is transferred to nonagricultural use, about 1 to 1.5 farmers lose their land. According to official statistics, some 34 million farmers have either lost their land entirely since 1987 or own less than 0.3 mu, and the new surge in land transfers almost certainly indicates acceleration of that process.
The government has met with some success in curbing the transfer of farmland for nonagricultural purposes during 2004, but a more sustained, legal, and probably larger-scale shift in rural land tenure patterns is in the offing, in this case driven by the central government's efforts to rationalize agriculture and raise rural incomes. The landmark Rural Land Contracting Law (RLCL), which took effect in March 2003, is the latest means toward that end. Under the post-1978 household responsibility system, land remains owned by the village,with use rights allotted by village leaders to individual households. The lack of secure land tenure periods and the frequent use of "readjustments" by village leaders (that is, reapportioning land between households) inhibited improvements to the land, transfer of land-use rights between farmers, and the emergence of commercial-scale agriculture. The RLCL mandates written contracts between farmers and villages, and sets the period of land tenure at 30 years. It includes clear provisions for the farmer's right to transfer land rights to others. And, to give potential buyers confidence that their land-use rights will be respected, it prohibits "readjustments" except in extreme cases (for example, natural disasters). No doubt, enforcement of the RLCL will be inconsistent. But the central government appears committed to the task and will almost certainly continue to sharpen land-use legislation. Indeed, the agenda may be expanded to ease rules on mortgages and to push the household-based tenure system toward an individual- based system, two measures that would substantially speed the transfer of land-use rights.
If successful, land reform will accelerate China's internal mass migration. But the impact of both illegal seizures and land reform will not be limited to an increased rate of migration. The compositionof the "floating population" also will be affected. Many of those who previously crowded onto trains for the cities went in search of higher incomes and were, in fact, adding one income to the family effort since their wives, husbands, or parents continued to work the farm in their absence. Today, an increasing number of people are moving with families in tow, no land or homes behind them, and no guarantees ahead.
China's best-known business and economics magazine, Caijing, has called the recent spate of rural and urban land seizures by alliances of local officials and real estate developers a new "enclosure" (quandi) movement, consciously echoing the process that sped urbanization and was so disruptive and violent ineighteenth-century England. But for many peasant families, legal transfers under the RLCL will have a similarly dislocating effect. Rural reform is incomplete without also guaranteeing the assimilation of China's migrants as full, productive members of urban society.
A BIGGER CRISIS TOMORROW
Speeding China's urbanization trades one social and political problem for another that is potentiallymore severe. The problem of poor farmers working small plots becomes that of poor migrants working dangerous jobs with few rights and virtually no social security safety net. The scale of China's urbanlandscape is already daunting: 166 cities of more than 1 million people (the United States has 9) and500 million official (that is, without counting migrants) urban residents. Urban population growth is already at 2.5 percent per year (versus 0.8 percent for India), and the government expects 300million people to move to China's cities and towns between 2004 and 2020. Because most of China's migrant workers retain their shenfen, or personal status, as farmers in their home locality, they are cut off from access to urban services, social security, and effective legal protection. This problem could worsen unless the next generation of migrants who
258 * CURRENT HISTORY * September 2004
Among well-heeled urban young people, the phrase "You're so farmer!" (Ni zhen nongmin!) has gained currency as a playful expression of disgust. have lost their land--either through illegal seizures or through the legal operation of a land-use rights trading system--are granted rights and benefits that will allow them to fully join urban society. The current plight of China's migrant workers offers a glimpse of the obstacles that must be overcome. Migrant workers without municipal hukou (registration) cannot participate in regular job markets. When they do find work, their rights under Chinese labor law are frequently violated. Their wages are withheld for months or years. The government estimates that China's 100 million migrant workers are owed $12 billion in back pay. Mandatory safety conditions often go unmet. According to The China Youth Daily, in one urban area alone--Shenzhen and the surrounding Pearl River Delta region--industrial accidents claim more than 30,000 fingers from workers each year. The standard payout for such injuries is $60 per finger, but many employers refuseto pay any compensation. According to government officials, nearly 70 percent of migrant workers have no form of insurance. And most live in shantytowns outside the cities, where whole neighborhoods aresubject to clearance and destruction on little notice and with little or no compensation.
The impact of this ambiguous, floating status falls disproportionately on children and other weak dependents who travel with workers. Currently, the floating population includes an estimated 3 million children aged 14 and under. According to a 2004 government report, pregnant migrant women and their children suffer mortality rates between 1.4 and 3.6 times the national average. Of migrant children between the ages of 8 and 14, some 15 percent do not attend school. Most of those who do attend pay high fees (often $100 or more) to enroll in improvised, substandard private schools. Pressures associated with payment--and shouldering an entire family's hopes for the future--have prompted a rash of student suicides and even murders. Although problems associated with migrant workers have been apparent for some time, the rapidly accelerating trend toward landlessness and the consequent growth in whole families on the move make specific problems associated with dependents new in magnitude if not in nature. And, while services in the countryside were also poor, China's underclass in the cities will perceive injustice more keenly as they see the benefits that the new rich enjoy every day. In theory, even urbanization advocates understand that, as Wang Mengkui, the State Council official, put it, "urbanization requires institutional innovation." To date, efforts have been limited to protecting migrants against some of the worst abuses. In a major government work report in March 2004, Prime Minister Wen Jiabao declared that the government would "basically solve the problem of default on construction costs and wage arrears for migrant rural workers in the construction industry within three years." The Ministry of Labor and Social Security said this year that it will oblige construction and manufacturing firms to provide health and life insurance to millions of migrant workers. And the central government has encouraged municipalities to give migrants greater and cheaper access to public schooling, though, as with most measures, no central funds are earmarked. In the first sign of state and party support for a broader defense of rights for the urban poor, reformers in the National People's Congress are now drafting a law that amounts to a "Bill of Welfare Rights" for China's internal migrants.
OBSTACLES TO REFORM
Despite the rhetoric and regulations, real progress has been limited, and the gap between rising consciousness of rights and the ability to act on and realize these rights is growing. The most obvious problem is money, or, as a group of Chinese scholars noted in a major new book, China's Urban Development Report, the question of "who will pay the bill for China's urbanization." The scholars' answer is simple: urban industry. But the construction industry, which is most relevant to the migrant economy, has resisted paying its existing obligations on time, much less shouldering additional costs. With local governments profiting from the constructionindustry and officials making their reputations based on building and development--not to mention widespread bribery and corruption--the incentives to overlook violations remain powerful. Nanjing University's Pan Zequan, writing in Strategy and Management, argues that pervasive discrimination against migrants is not simply an inherited evil now being attacked and reversed; rather, it is built on consciously erected systems and policies and is regularly "produced" and "reproduced." Although progress has been made in some areas, Pan's contention that a dynamic struggle is under way rings true. Certainly, discrimination against migrants works to the advantage of--and is convenient for--those who already hold entitlements in the cities. Material interests are reinforced by strong local identities and prejudice against rural "outsiders" (waidiren)--a phrase invariably used in reference to migrants. Eastern The Latin Americanization of China? * 259 urbanites frequently explain to Western visitors that waidiren are of "low quality" (suzhi di) and say they feel less in common with domestic migrants than they do with foreigners. Among well-heeled urban young people, the phrase "You're so farmer!" (Ni zhen nongmin!) has gained currency as a playful expression of disgust.
Given hostile interests and culture, it is not surprising
that measures to lessen the hardships of migrants often meet with obstruction. Despite Beijing city officials' recent order to public schools to admit the children of migrant workers and to cut discriminatory tuition fees imposed on them, many schools continue to exclude migrants by claiming to be filled to capacity when, in fact, a survey by the Beijing Education Department showed 35,000 vacancies. Members of the floating population face discrimination even in death. In a recent incident in Luzhou, an explosion in a city gas pipeline killed several people. The families of city residents were compensated with $17,000--those of migrantworkers were given $5,000. Although they lived and worked and died in the city, the migrants were still classified as peasants. An official justified the difference with the claim that "the cost of living in the countryside is lower."
Although China's leaders continue to view the rural problem as the nation's greatest threat, a 2004 survey by the Chinese Academy of Social Sciences singles out migrants as the great economic loser of the post-1978 era. When askedwhich of eight groups had benefited most from China's economic reforms, a distinguished panel of experts was unanimous on only one item: "migrant workers" were worse off than any other group. The least fortunate of them join what a leading government researcher, Zhang Xiaoshan, has described as a new class, the "three havenots": people with no land, no jobs, and no access to national income insurance.
THE FUTURE: LIBERAL, FASCIST, OR DICKENSIAN?
Broadly speaking, three possible 15-year outcomes to the dual rural-urban crises are possible:liberal, authoritarian corporatist (or fascist), and botched. None of these outcomes is preordained.We would argue, nevertheless, that China is now groping its way at least tentatively toward the first, though the pace of social change and the difficulty of overcoming entrenched interests may ultimately make the third most likely.
Progress toward a liberal outcome would see the village election system strengthened and expanded at least to the township level. Land reform would proceed but with land reforms matched by commensurate and simultaneous urban reforms that protect new arrivals in cities and second-generation migrants, and that permit employment beyond construction and road sweeping. In urban areas, the hukou system (already being revised) would be eliminated and public services made equally available to all people living and working in a given region. An awareness of legal rights would develop, along with the means to actualize them. Ultimately, individuals, regardless of their status, would be allowed to organize in groups free from direct state control to defend their interests. Movement can be seen in most of these areas.
Village-level democracy--imperfect as it is--is bringing greater accountability to the countryside. Nationally, progress in building legal institutions and, especially, fostering a "rights and accountability" culture has been made on a broader front. Although the road ahead is still much longer than that already traveled, the state seems prepared to countenance a judicial system that will be used to mediate interests as part of the local political process, not simply to administer justice. Legal awarenesshas been aided by the central government's emphasis on "rule of law" in its own battles to control provincial and municipal governments. And peasants are responding. The State Council Development Research Center reports that an increasing proportion of official petition and protest letters cite legal rights and protections as the basis for the complaints.
In the cities, the state has tolerated, if not encouraged, the rise of a few new independent social organizations. Writing in The China Journal in January 2003, Benjamin Read analyzed the development of urban housing associations focused on gaining control of management and improving service quality in upscale real estate developments. These groups capitalize on the government's recent promotion of notions of certain "rights" to property and consumer protection. They have fended off attempts at government co-optation and are promoting a sense of common identity among their members in addition to pursuing claims against negligent or corrupt real estate developers. While Read cautions that it remains to be seen whether these groups can sustain their current autonomy, they offer tantalizing evidence of the kind of ad hoc, innovative interest-intermediation groups that could become the basis for more permanent social and political institutions. Yet, by their very nature, these new associations highlight the disparities in
260 * CURRENT HISTORY * September 2004
income and social rights between China's haves and have-nots--such open organization and representation are not tolerated in migrant shantytowns. Nor have they successfully emerged among poor city residents who are forced to move from older downtown buildings demolished to make way for new developments. Despite the caveats, however, all this adds up to substantial progress toward a more liberal future.
Unfortunately, other social and political possibilities are also readily apparent. Observers such as Michael Leeden and Jasper Becker have argued that China, far from becoming more liberal, has moved in the opposite direction, toward fascism. Benchmarks for movement in this direction would include the consolidation of society into state-dominated and controlled hierarchical organizations; administrative, rather than judicial, mechanisms for social conflict resolution; the strategic use of anticapitalist and anti-foreign rhetoric; and the heavy involvement of the military in propaganda and social work.
In fact, this largely describes elements of China today. Yet all of these features are becoming less true of the Chinese state, rather than more. Private industry is growing relatively faster than state industry. New self-organized groups are cropping up faster than the state can effectively co-opt orsuppress them. The media are more robust, independent, and commercial, with ever-shrinking restrictions on what can be reported. The legal system is growing stronger. And the military is distancing itself from its socioeconomic functions as it has been reduced in size and professionalized. In most key dimensions, China is currently headed away from authoritarian corporatism, not toward it. There is, however, a third possible trajectory: a "Latin Americanization" of China in which the state could fail to develop institutions capable of adequately addressing China's new social crisis. The speed of social change and the explosive growth of social conflict may outstrip the state's ability to respond. Political leaders could settle into a collusive relationship with business and social elites. A semipermanent have-not class might engage in a constant and economically costly low-level war with the entitled minority. For many Chinese scholars and government officials, Latin American-style social and political problems are now an explicit frame of reference for what China might face if it fails to reverse social trends in the near future. Despite movement toward a more adaptive, liberal future, the downward spiral toward failure may in fact be just as likely in the mid-term. Some indicators already point toward this outcome. The 2004 report of the Politics and Law Commission of the Communist Party found that the number of incidents of "social unrest" or "mass incidents" rose 14.4 percent in 2003, to 58,000 nationwide. The number of people involved rose 6.6 percent, to 3 million. In the cities, the "floating population" accounted for "up to 80 percent of all crime." Evidence from numerous urban areas suggests that avoiding the Latin Americanization of Chinese society and a descent into low-level class warfare will require more than partial measures designed to mitigate the worst suffering of migrants--it will require making them full citizens.
THE NEED FOR SPEED
China's leaders are intently focused on the nation's rural crisis and the growing gap between urban and rural quality of life. Their proposed solution to these problems--land reforms aimed at promoting mass migration and rapid urbanization--is likely to speed the arrival of a second crisis, pitting migrant families against entrenched urban interests in a struggle for rights and entitlements. Those urban interests are themselves powerful forces, including alliances of municipal officials, real estate developers, and construction industries, alongside a new wealthy urban class and existing ranks of urban poor and unemployed. Yet many migrant farmers, some accustomed to voting for their village leaders, and now promised new protections by the government, bring a new "rights consciousness" with them when they move to the cities. Their expectations of fair treatment and access to benefits such as insurance and health care can only be ignored at the government's peril. While it is struggling with difficult but familiar rural conflict, China's leadership is less well endowed to deal with the coming urban social challenge. The Chinese system does have remarkable strengths, not least the practice of conducting pragmatic economic and political experiments in individual locations and then embracing successful methods nationwide. It is entirely possible that liberalizing interim solutions could become more permanent institutions, as they did in the England that Polanyi described. But with government plans calling for the market-based"enclosure" of China's rural areas, and several hundred million migrants likely to move to the cities over the next two decades, Beijing is in a race against time.
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Oil Could Help Japan Resolve Territorial Fight With Russia
By JAMES BROOKE
NOSAPPU, Japan, Sept. 2 - Wearing a white windbreaker to protect him from the Siberian wind, Prime Minister Junichiro Koizumi stood on the bridge of a Japanese Coast Guard patrol boat on Thursday, scanning the treeless shores of islands occupied by Russia since September 1945. Following close behind was an uninvited escort: a Russian Coast Guard patrol boat.
The moment on the Sea of Okhotsk seemed frozen in time. Nearly six decades after Soviet troops swept down the Kuriles, seizing the Japanese islands, there is no peace treaty between Russia and Japan.
But the rapidly changing geopolitics of Asia's energy industry could break a logjam that has endured since World War II.
About 350 miles northeast of here, offshore of Sakhalin Island, part of Russia, Japanese companies are participating in the first $10 billion slice of what could be a $100 billion development of oil and gas reserves believed to rival the North Slope of Alaska.
About 700 miles east of here, at Vladivostok, Japanese and Russian officials met this summer to outline a plan for a 2,500-mile, $12 billion pipeline to bring Siberian oil to the Sea of Japan. A decision on the pipeline is expected this fall.
Behind Japan's drive to lock in access to Russian oil and gas are forecasts that over the next 15 years China's oil imports will double and its gas imports will increase fivefold. Japan's energy use, meanwhile, is far from stagnant. In July, Japan, which imports 88 percent of its oil from the Middle East, experienced a 9 percent jump in the volume of its oil imports.
"Japan finds itself very much like before World War II," Alexander Losyukov, Russia's ambassador to Japan, said in a recent interview. "It needs resources and markets, and those two things can combine to lead to a very dangerous situation."
Japan has quietly become the largest foreign investor in Russia's energy-rich Far East region. With Russia's president, Vladimir V. Putin, expected to visit Tokyo in six months, many analysts feel the time is nearing for both sides to negotiate a truce over the four disputed islands. Both sides have said they would like to announce a formula for a bilateral peace treaty during Mr. Putin's visit, which will coincide with the 150th anniversary of the first trade treaty signed by the countries, in 1855.
"Prime Minister Koizumi is very much interested in getting this bilateral relationship to move," Takashi Inoguchi, professor of international politics at the University of Tokyo, said. "Something has to be done to get the two countries closer."
The Toyota Motor Corporation, Japan's largest carmaker, is expected to take advantage of Mr. Putin's visit to announce the opening of its first assembly plant in Russia, probably in the Volga region east of Moscow. Last year, Toyota tripled its new car sales in the country to 25,000, making it the most popular imported brand in Russia.
Despite the signs of a thawing relationship, however, Moscow frowned on Mr. Koizumi's boat trip around the islands - the first by a Japanese prime minister.
"Such actions, let alone their demonstrative timing with the anniversary of the end of World War II, not only fail to give a positive impetus to the peace treaty negotiations, but will only complicate the negotiations once again," Russia's foreign ministry warned Monday after Mr. Koizumi announced he would take the trip. "As far as we understand, these plans are primarily based on internal political considerations."
Indeed, Mr. Koizumi's tour here on Thursday might have been calculated to neutralize conservative opposition before serious talks start.
That would fit a pattern of such steps by his administration. On Aug. 15, the anniversary of Japan's World War II surrender, Shoichi Nakagawa, Japan's powerful minister of economy, trade and industry, was one of four members of Mr. Koizumi's cabinet to visit a Tokyo war memorial shrine venerated by conservatives. The next day, Mr. Nakagawa flew to Sakhalin, becoming the first Japanese minister to visit the island, which was partly controlled by Japan until the end of World War II.
During a five-day tour, he visited the site of the construction of Russia's first plant to liquefy natural gas. Several of Japan's largest utilities have signed long-term contracts to import the Sakhalin gas.
With Japan expected to win rights to the Siberian oil pipeline, Russia is moving to mollify China. On a visit to Beijing last week, Russia's energy minister, Viktor Khristenko, told journalists that Russian oil sales to China would increase fivefold by 2010. Russia is China's fifth-largest source of oil.
With gas emerging as an equally valuable energy source, China and Japan are shadowing each other in the East China Sea. With China laying a 300-mile gas line to offshore deposits, Japan has complained that China will tap into a 246 billion cubic meter gas field that is partly Japanese. With each country's exclusive economic zone in dispute, China's moves to develop the gas have been met by a Japanese survey ship, exploring the contested area in the southern tip of Okinawa Prefecture.
Americans restored Okinawa to Japanese rule in 1972. Now, people here say that the time has come for Russia to give up its war booty as well - the four disputed islands, which the Japanese call the Northern Territories and the Russian call the Southern Kuriles. The islands' total landmass is larger than Okinawa's.
"Without restoration of the four islands, we will not have a Japan-Russia peace treaty," Mr. Koizumi said here in a meeting with representatives of the 8,000 former inhabitants of the islands who are still alive. "Restoration of the four islands will not only benefit Japan, but it will benefit Russia."
With billions of dollars of Japanese investments about to start flowing, Mr. Losyukov, the Russian ambassador, fretted that Japan might link the island issue with the rate of investment. "Every time we talk about that, we hear from the Japanese side, 'We want simultaneous action on economic and territorial issues; if you take this approach you are braking everything,' " Mr. Losyukov said. "Blocking everything by that way, unfortunately, is linkage."



Copyright 2004 The New York Times Company
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U.S. Links S.Africa Nuclear Suspect to Libya, AQ Khan
Fri Sep 3, 2004 12:09 PM ET
By Gershwin Wanneburg
VANDERBIJLPARK, South Africa (Reuters) - The United States Friday linked a South African charged under weapons of mass destruction laws with Libya's clandestine nuclear program and Pakistani scientist A.Q. Khan's nuclear black market.
Johan Andries Muller Meyer, 53, appeared in court Friday on charges of manufacturing nuclear-related material and exporting goods that could be used in developing weapons of mass destruction. Meyer was remanded in custody until Sept. 8.
Within hours the United States embassy in Pretoria issued a statement linking him to Libya's nuclear program, which the north African country disclosed in December 2003 before agreeing earlier this year to a disarmament process.
Libya began its quest for nuclear arms in 1980 and decided in 1997 to seek centrifuge equipment via the atomic black market, established in the 1980s by Abdul Qadeer Khan, the father of Pakistan's nuclear bomb.
"South African government agencies worked long and hard with various partners to monitor sensitive materials that were integral to the AQ Khan network's efforts to supply Libya's clandestine nuclear program," the embassy said.
"We understand that South African investigators successfully seized the materials in recent days and have made an initial arrest related to the illegal activities. South Africa's decisive action adds vital information to the worldwide investigation into the network's reach and sends the right signal to proliferators everywhere," it added.
SOUTH AFRICAN IN CUSTODY
Charges against Meyers, who appeared in court in Vanderbijlpark, 60 km (35 miles) southwest of Johannesburg where he was arrested Thursday, did not mention Libya.
The charge sheet said Meyer was accused of offences between 2000 and 2001 relating to the import and export of regulated goods "which could contribute to the design, development, manufacture and deployment" of weapons of mass destruction.
Meyer, the director of a local engineering company, was also accused of "unlawfully and willfully possessing and manufacturing nuclear-related equipment and material" between 2002 and 2004.
Defense attorney Heinrich Badenhorst told national news agency SAPA his client was accused of manufacturing the banned goods at his engineering works, but denied the charges.
His lawyers said contraventions of the country's anti-proliferation laws could result in anything from a fine to a 15-year jail sentence.
Government officials have said they know of no link between the inquiry and al Qaeda or international terrorism, and Foreign Affairs spokesman Ronnie Mamoepa said simply that the government had "taken note" of the U.S. statement.
South Africa voluntarily dismantled its nuclear arms before apartheid ended in 1994 -- the only nuclear-armed state to do so -- and has been eager to show support for international efforts to limit nuclear know-how with a series of new laws since 1993.
Khan's network spanned the globe and included suppliers, often unwittingly, from Europe, Africa, the Middle East and Asia.
U.N. atomic weapons experts say more than 20 countries were involved, though it is trying to grasp the full extent of what International Atomic Energy Agency Director Mohamed ElBaradei called a global supermarket for countries interesting in getting nuclear weapons.
South African police said in February this year Washington had asked for their help in investigating possible associates of Asher Karni, a former Israeli army officer accused by the U.S. government of conspiring to export 200 U.S.-made nuclear weapons detonators to Pakistan via South Africa.




South African Held on Nuclear-related Weapons Charges
Delia Robertson
Johannesburg
03 Sep 2004, 16:07 UTC
Listen to Delia Robertson's report (RealAudio)
Robertson report - Download 224k (RealAudio)
A South African businessman has appeared in court on charges of importing materials which could be used in the manufacture of nuclear products.
Johan Andries Muller Meyer faces three charges of illegally importing and possessing materials and equipment that could lead to the development, manufacture, or maintenance of weapons of mass destruction.
The equipment allegedly found in his possession can be used in the production of enriched uranium, which is used in the manufacture of nuclear weapons.
Mr. Meyer's attorney, Heinrich Badenhorst, earlier told a local news agency that he was accused of manufacturing weapons at his engineering firm in Vanderbijlpark, an industrial area 90 kilometers south of Johannesburg. Mr. Badenhorst said his client denies the charges.
The South African Council for the Non-Proliferation of Weapons of Mass Destruction said in a statement that Mr. Meyer was arrested following an investigation of several companies and individuals. Council Chairman Abdul Minty said the investigation had been conducted with the cooperation of officials in other countries and with the International Atomic Energy Agency (IAEA).
South Africa's apartheid government developed a nuclear weapons capability in the 1970s in defiance of international treaties. But the program was unilaterally dismantled before 1993 and subsequently verified by the IAEA.
In his statement, Mr. Minty said South Africa has since followed a strict policy of disarmament and non-proliferation of weapons of mass destruction.
Mr. Meyer was ordered jailed until Wednesday when he will face a bail hearing.
Foreign intelligence activities reach alarming level: Ryamizard
MEDAN, North Sumatra (Antara): Indonesian Army chief Gen. Ryamizard Ryacudu expressed concern here on Friday over the alarming level of foreign intelligence activities in the country.
Such an alarming level has put the country's unity and cohesion at stake, he said.
"There have been so many foreign intelligence officers here. They have created an unstable condition under all kinds of pretexts," he said.
Ryamizard said foreign intelligence operatives have donated substantial funds to rebel movements in various parts of the country to create internal conflicts.
He said uprisings in Aceh and Papua bore hallmarks of outside interference as did communal conflict in the district of Poso and on Maluku island.
Indonesia's military last year launched a major operation to crush a decades-old separatist movement in Aceh province, on the northern tip of Sumatra island. It has also been battling low-level rebellion in remote Papua.
Violence between Muslims and Christians on Maluku and Poso has claimed thousands of lives in recent years. (**)




Man held in Gauteng over nuclear weapons
September 3, 2004
http://www.thestar.co.za/index.php?fSectionId=128&fArticleId=2211089
By Graeme Hosken and Sapa
A South African man has been arrested for allegedly contravening the law on weapons of mass destruction and nuclear energy.
The Star has established that yesterday's arrest came after an international investigation involving South African, United States and Israeli intelligence agencies into the alleged smuggling of nuclear weapons to "Asian countries", specifically Pakistan.
The suspect was due to appear in the Vanderbijlpark Magistrate's Court today.
It is believed that a senior Israeli army officer had planned to sell nuclear arms - or parts of nuclear weapons and computer software - to Pakistan, using South African parastatal arms companies that had previously been involved in the now-defunct nuclear weapons programme.
The Foreign Affairs Department announced last night that an arrest had been made concerning "items alleged to have been used in the contraventions".
Abdul Minty, the chairperson of the South African Council for the Non-Proliferation of Weapons of Mass Destruction, said inquiries were being made into the activities of "some companies and individuals who may be involved".
"In the context of these investigations, the South African authorities have co-operated with their counterparts in other countries as well as with the International Atomic Energy Agency."
Since 1994, Minty said, the government had adopted a strict policy of disarmament and non-proliferation with regard to weapons of mass destruction.
NIA spokesperson Lorna Daniels said last night: "The NIA (National Intelligence Agency) has been involved in investigations for some time relating to today's arrest, and it's been an intensive investigation with several law enforcement agencies."
She said more arrests were expected soon, but declined to comment further.



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The Kissinger Myths
By Thomas Donnelly
Posted: Thursday, September 2, 2004
BOOK REVIEWS
New York Sun
Publication Date: August 31, 2004
The Flawed Architect: Henry Kissinger and American Foreign Policy
By Jussi Hanhimaki
Oxford University Press, 554 pages, $35
Henry Kissinger so bestrides the American foreign policy of the past 50 years that any biography of the man, at this moment and for many years to come, is an act of great intellectual bravery. Indeed, it may be bravery to the point of foolhardiness. For there is not just one Kissinger Myth, but many.
One version, winked at by the man himself, has it that Mr. Kissinger is an American Metternich, Talleyrand, and Bismarck rolled into one. The other extreme makes him out to be a war criminal, personally responsible for the death of millions and the misery of nations on every continent. Whatever the truth, it's a good bet neither of these myths bears much resemblance to it.
Both man and myth loom so large they obscure an even more important phenomenon, which might be called "Kissingerism": The application of Continental "realpolitik" to American strategy-making during the middle and late Cold War. Far more than Mr. Kissinger's actions or policies, this habit of mind is now almost hardwired into the conventional wisdom of the United States policy-making elite. It even has eerie echoes in the policy prescriptions of Senator Kerry, who sometimes sounds as though he favors a kind of detente with the autocrats and terrorists of the greater Middle East. Kissingerism will be with us for decades to come, long after the man himself is gone.
By its title, Jussi Hanhimaki's new book The Flawed Architect: Henry Kissinger and American Foreign Policy (Oxford University Press, 554 pages, $35) seems to promise an appraisal of the great man's larger influence. But the passage from which the book takes its title--concluding that Mr. Kissinger's failure to "seriously challenge" the "conventional wisdom" of the Cold War "does not make him a war criminal. It makes Henry Kissinger a flawed architect"--shows both the scope of the author's analysis and his political agenda.
The perspective of Mr. Hanhimaki, a Finnish academic who has taught at the London School of Economics and now is at the Graduate Institute of International Studies, is standard-issue European leftist - which means that the American victory in the Cold War is primarily a nuisance to be ignored. Our ultimate victory does not justify every mistake or cruelty of American policy during five decades, but any critique that fails to take the larger strategic picture into account is itself deeply flawed.
Perhaps even more importantly, Mr. Hanhimaki's arguments take no account of the post-Cold War effects of Mr. Kissinger's statesmanship. This makes his account of Mr. Kissinger's secret diplomacy, the opening to China, and the "triangular" strategy for containing the Soviet Union highly unsatisfactory: We get a highly detailed account of who met with whom, when, and where, but no real understanding of whether the policy was a wise one or whether it has had unfortunate consequences under quite different strategic circumstances.
A final complaint is that Mr. Hanhimaki has very little to say about Mr. Kissinger's formative years and writings or his success as a senior statesman. Thus the reader is left with very little understanding about the foundations of Mr. Kissinger's thought or how he has remained influential after leaving office, both through the professional success of his acolytes, such as Brent Scowcroft or Lawrence Eagleberger, and by the exercise of his own pen and public presence. The phenomenon of "Kissingerism" would be a complete surprise to a reader who came to know the man only through "The Flawed Architect."
Nonetheless, the book does give us clues to Mr. Kissinger's diplomacy through sheer accumulation of detail. One pattern that emerges, almost despite the author, is that Mr. Kissinger is better understood as a tactician than as a strategist. The opening to China, Mr. Hanhimaki reminds us, was driven as much by the desperate need to get out of Vietnam as any larger strategic view of the Soviets. North Vietnamese negotiator Le Duc Tho clearly had the advantage of the American Bismarck in the Paris peace talks.
Mr. Hanhimaki has plowed through newly released materials from the Nixon and Ford years to work relative ly barren soil on several points, in particular the question of prolonging the war in Vietnam. In these passages, Mr. Hanhimaki's bare-bones narrative is an effective way of conveying the tragedy of the United States' exit from Vietnam. "In 1972-73 Kissinger had gradually given in ... to North Vietnamese demands," Mr. Hanhimaki writes, in a simple, elegant paragraph worth quoting at length:
Through a series of communications with the Chinese and Soviets he had made it clear that soon after the return of American personnel the United States was ready to abandon Southeast Asia to its own devices. He was not searching for a peace with honor but an exit strategy and a decent interval before South Vietnam's political future was determined. Pressed in part by domestic political considerations, Kissinger's complicated diplomacy thus managed to produce a remark able role reversal: in 1972 it was South Vietnam's President Thieu, rather than Le Duc Tho or the North Vietnamese, who became the chief villain for refusing to accept an agreement negotiated over his head. Over the next two years the once steadfast allies would bear the bur den of the end of America's "Indochinese nightmare." In 1973, the South Vietnamese would suffer more battle-deaths than they had in any year since 1968. The decent interval was covered in blood.
This bitter requiem for South Vietnam is a reminder of the price of realpolitik and the sanctification of "stability" in international politics, and is all the more ironic for being written by a European, leftist academic. It also serves, perhaps, as a reminder of what the consequences might be of American withdrawal from the greater Middle East.
The final chapters in the Kissinger story remain to be written. In recent years, Mr. Kissinger himself has seemed to renounce the amoral practice of realpolitik - as though the great architect does appreciate his own past flaws. Mr. Hanhimaki's work is not the deeply considered assessment of Mr. Kissinger and his lasting influence on U.S. foreign policy and strategy I might have hoped, but it points the way toward a larger, more comprehensive study.
Mr. Donnelly is resident fellow in defense and national security studies at the American Enterprise Institute.

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'Secrets' Perplex Panel
Classified Data Growing to Include 'Comically Irrelevant'
By Michael J. Sniffen
Associated Press
Friday, September 3, 2004; Page A17
A former dictator's cocktail preferences and a facetious plot against Santa Claus were classified by the government to prevent public disclosure.
Also stamped "secret" for six years was a study concluding that 40 percent of Army chemical warfare masks leaked.
These, as well as other examples of classification were cited last week by members of Congress and witnesses at a House subcommittee hearing into the Sept. 11 commission's conclusion that secrecy is undermining efforts to thwart terrorists.
Some classifications were made in error or to save face.
The CIA deleted the amount Iraqi agents paid for aluminum tubes from Page 96 of a Senate report on prewar intelligence. The report quoted the CIA as concluding that "their willingness to pay such costs suggests the tubes are intended for a special project of national interest."
That price turned out to be not so high. On Page 105 of the same Senate report, the same security reviewers let the CIA's figure -- as much as $17.50 each -- be printed along with other estimates that the Iraqis paid as little as $10 apiece.
"There are too many secrets" and maybe too many secret-makers, said Rep. Christopher Shays (R-Conn.), chairman of the House Government Reform Committee's national security panel.
There are 3,978 officials who can stamp a document "top secret," "secret" or "confidential" under multiple sets of complex rules.
No one knows how much is classified, he said, and the system "often does not distinguish between the critically important and comically irrelevant."
The problem is growing, said J. William Leonard, director of the National Archives' Information Security Oversight Office, which monitors federal practices. Officials decided to classify documents 8 percent more often in 2003 than in 2002. Total classification decisions -- including upgrading or downgrading -- reached 14 million.
"The tone is set at the top," Shays said.
"This administration believes the less known, the better," added the Connecticut Republican, noting sadly he was speaking of a GOP administration. "I believe the more known, the better."
The panel's ranking Democrat, Rep. Dennis J. Kucinich of Ohio, noted that former President Bill Clinton directed that in cases of doubt, the lowest or no classification be used. But in 2003, President Bush ordered officials to use the more restrictive level.
Steven Aftergood, director of the Federation of American Scientists' project on secrecy, said some classification was designed to conceal illegality or avoid embarrassment, even though that is forbidden.
Aftergood cited the "secret" stamp on Army Maj. Gen. Antonio M. Taguba's report of "numerous incidents of sadistic, blatant and wanton criminal abuses" inflicted on Iraqi inmates at the Abu Ghraib prison.
Carol A. Haave, deputy undersecretary of defense for counterintelligence and security, said most misclassification was unintentional, resulting from misunderstanding or failure to declassify data that are no longer sensitive. She said a weakness, particularly for anti-terrorism efforts, was that those who collect intelligence determine its classification.
"Collectors of information can never know how it could best be used," Haave said. "We have to move to a user-driven environment."
Leonard, the Archives official, said another obstacle to sharing anti-terrorist data as the Sept. 11 commission envisioned was that federal law divides the authority for writing the rules that govern secrets. The CIA director has authority to protect intelligence sources and methods, the Energy Department has power to write regulations to shield nuclear secrets, the Pentagon has control over classifying NATO data and the National Security Agency can define eavesdropping communications secrets.
"All these variations have nuances that impede cooperation," Leonard said.
Aftergood, who is fighting in court to declassify the overall budget for intelligence agencies, argued that declassifying that total "could break the logjam" of overclassification. That was also recommended by the Sept. 11 commission.
Leonard said a 2000 law created a public interest declassification board to recommend release of secrets in important cases, but the president and Congress never appointed members.
For the curious: The CIA classified for 20 years longtime Chilean dictator Augusto Pinochet's preference for pisco sours, according to subcommittee staff members citing previously classified documents published by the National Security Archive, a private anti-secrecy institute at George Washington University.
And a CIA employee made up a story of a terrorist plot to hijack Santa Claus and inserted it into classified traffic. "So, apparently, the fact that CIA had a sense of humor was classified," said subcommittee counsel Lawrence J. Halloran.
? 2004 The Washington Post Company
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Symposium: Atomic Ayatollahs
By Jamie Glazov
FrontPageMagazine.com | September 3, 2004
Does Iran already have nuclear weapons? Is it on the verge of acquiring them? Will the U.S. have to initiate regime change unilaterally?
To discuss these and other questions with us today, Frontpage Symposium has assembled a distinguished panel:
Jed Babbin, the former deputy undersecretary of defense in the administration of President George H. W. Bush. A contributing editor of The American Spectator Magazine and a contributor to National Review Online, he is the author of the new book Inside the Asylum: Why the United Nations and Old Europe Are Worse Than You Think;
John Loftus, a former Justice Department prosecutor with code word clearances whose 1982 expose of Nazis working for western intelligence won the Emmy Award for Mike Wallace. He is the author of several books on the Middle East and the director of INTELCON.US, the upcoming National Intelligence Conference and Exposition. At 10:30 every weeknight, the Loftus Report is a featured segment of ABC national radio, and Fox Television's "Inside Scoop with John Loftus" airs at 11 am Sundays. His website is John-Loftus.com;
and
Reza Bayegan, a commentator on Iranian politics who was born in Iran and currently works for the British Council in Paris. His weekly columns appear on many publications including Iran va Jahan website. He is a regular guest on exile Iranian radio shows.
FP: Jed Babbin, John Loftus and Reza Bayegan, welcome to Frontpage Symposium.
Mr. Bayegan let me begin with you. What exactly is the threat we face? Does Iran already have WMDs? Or is it on the verge of having them? What is the threat here?
Bayegan: The Islamic Republic already has stockpiles of chemical weapons and has told the EU three (Britain, Germany and France) 'that it could possess nuclear weapons within three years. The real time limit the mullahs need to obtain a nuclear bomb however is less than 11 months.
The danger we face from the regime in Tehran acquiring the nuclear bomb cannot be exaggerated. Our democratic values and the very survival of Western civilization are at stake. In particular such an eventuality would be the worst nightmare scenario for the state of Israel and an unprecedented blow to peace and liberty throughout the world.
Since September 11, we have seen how terrorists are able to strike anywhere they choose and hijack Western democratic processes by intimidating the public as they did during the recent Spanish election. With a nuclear bomb at their disposal they can do this without risking their own lives and by pushing -- or just threatening to push -- a button.
With or without WMDs, the danger the clerical regime poses is far greater than the other members of the 'axis of evil' i.e. Iraq during Saddam Hussein and North Korea. This danger is rooted in a ruthless anti-Western ideology that manipulates the religious belief of the masses and justifies any means for reaching its deadly objectives. If the mullahs get their hands on a nuclear bomb we might as well assume that Hamas and other terrorist organizations have access to it also.
On August 15 2004, the military chief of the Islamic Republic declared that the entire Zionist territory 'is within the range of Iran's new advanced ballistic missiles'. The mullahs are counting the days until they can arm these missiles with nuclear or biological warheads. Experts believe that although due to their inherent inaccuracy the Iranian Shahb-3 and the planned for Shahab-4 missiles make no military sense if armed with conventional warheads, they can become immensely effective as terror weapons against civilian targets.
In other words, the dictators in Tehran gaining weapons of mass destruction would impose the same or worse state of terror on the rest of the world as they have imposed on the Iranian people for the last quarter of a century.
FP: Mr. Babbin, what Mr. Bayegan is describing here is terrifying. Do you agree that the danger the clerical regime poses is far greater than the other members of the Axis of Evil?What is your view of this threat? Are we going to have to pursue regime change asap?
Babbin: I agree that Iran is, by far, the most dangerous terrorist nation. Their nuclear ambitions and their unarguable involvement in global terrorism make them our number one problem. The threat from Iran is threefold:
[1] they are supporters of the conventional terrorists such as Hizballah, al-Queda and many others that have American blood on their hands.
[2] they are funding, supplying and operating the al-Sadr insurgents in Iraq. The Iranian regime has decided to make a stand against democracy in Iraq, and we must find a way to end their interference or Iraq will never be free or stable.
[3] their nuclear ambitions are close to being achieved. If they are, the whole Middle East and even parts of Europe will be threatened, as will American interests everywhere.
We should be pursuing regime change in Iran now, through covert operations, support for Iranian opposition groups (such as the Mujahideen e Khalq, which we wrongly labeled a terrorist group at Tehran's request) and by preparing what may be an inevitable military strike against their nuclear program.
FP: Mr. Loftus, what do you make of the two gentlemen's comments?
Loftus: If anything, they understate the threat. Let us put Iran's nuclear development in context. During the 1990's the Peoples Liberation Army of China made a strategic decision to trade the components of the Islamic Bomb in return for greater access to Arab oil, necessary for China's growth.
The PLA used its proxy state, North Korea, to carry out the nuclear proliferation deal. Iranian nuclear engineers were frequently observed flying to North Korea and Pakistan.
For short term diplomatic reasons, the US is going along with the fiction that the A.Q. Khan network in Pakistan was merely a private criminal enterprise. Supposedly, this "private" network arranged to provide North Korean missiles to the Pakistan army in exchange for advanced nuclear centrifuges. Several of these P-2 centrifuges were discovered in Iran by the IAEA inspectors.
The Pakistani government has refused to cooperate with the IAEA's investigation of Iran. Access to uranium stain samples has been denied. This denial is critical for the IAEA to prove that Iran has its own nuclear track, which cannot be explained by the nuclear stains found on the Pakistani centrifuges. Without the Pakistani evidence, the IAEA is denied the smoking gun to prove that Iran is still lying about its nuclear program.
At some point, the Bush administration will have to stop sitting on its intelligence evidence if it wants to make its case to the UN that the Iran-North Korean-Chinese partnership is the single greatest threat to world peace.
FP: Thanks Mr. Loftus. This is very terrifying because what exactly can we really do about this? Make a case to the U.N.? This is a joke. What's the U.N. gonna do? It's pretty evident by now, isn't it, that the U.N. is a body that works against the interests of the U.S., democracy and freedom? The U.N. should have acted on this long ago.
Mr. Loftus do you agree? And so what do? Do we wait for the U.N. to take action or is the U.S. gonna have to do something drastic unilaterally?
Loftus: I think the whole mess is about to erupt this fall. My bet: after the U.S. elections are over.
FP: You want to expand a bit?
Loftus: Not yet. October surprises come in October.
FP: Ok then. Well we'll talk in November about this with you then. Mr. Bayegan, your view on the U.S. supporting Iran's opposition?
Bayegan: I agree with Mr. Babbin that Iranian opposition groups should be supported. I would like however to put in a caveat here about groups such as Mujahedin e Khalgh. This group is abhorred by the majority of Iranians for its opportunistic stance during the Iran-Iraq war and its ideological hodgepodge of Islamic Marxism. The track record of the group as far as ethical and moral integrity is concerned is also quite bleak. It has been in cahoots with Saddam Hussein, the PLO and many other brutal terrorist organizations around the globe.
If there is a group with a more shattered popular base than the mullahs it is the Mujahedin e Khalgh. Having said that, one cannot deny that they have high organizational and disciplinary skills which could be useful for overthrowing the mullahs. If support is to be provided to this group and similar organizations it should be made conditional on their acceptance of democratic principles and civilized political norms.
Iranians have no affinity for Marxism or Islamic obscurantism dished out by the mullahs for the past twenty-five years, but can feel at home in their ancient traditions of respect for human rights and tolerance. Reza Pahlavi, the son of the late Shah of Iran who lives in exile in the U.S., is the only Iranian political figure whose voice rings true for Iranians. His political agenda of separation of Mosque and state (see his book Winds of Change) and his crusade for holding a national referendum to let Iranians freely decide about their national future (a Republic, Monarchy, etc.) is the most solid ground for bringing about political transformation in Iran. His campaign, which is the only force that can unite all Iranians, should be supported with our wholehearted effort and the maximum commitment the democratic world can muster.
I would like to give the highest emphasis here to the fact that we cannot achieve a sustainable democratic transformation in Iran without the trust and blessing of the Iranian public. We have to use all possible means to isolate the regime and at the same time never for a minute lose sight of the legitimate aspirations of the Iranian people for peace, national dignity and democracy. This can be done by encouraging Iranian political groups to come together under the umbrella of calling for a free and democratic national referendum.
Regarding Jamie's remark about the UN, I would like to say that the United Nations, IAEA and for that matter efforts of the three European powers to coax Iran to convert to a trustworthy regime and keep its nuclear program peaceful will not work because the mullahs policy of acquiring nuclear bomb is part of an overall strategy to defeat Western democratic values and annihilate the state of Israel. It is a betrayal of peace and human liberty to make concessions to a government which will use any possible means to secure its deadly objectives. The weakening and disintegration of the clerical regime can be achieved by concerted international effort and application of the highest possible pressure in all fields.
FP: Mr. Babbin, what do you make of Mr. Bayegan's emphasis on democratic principles as an ingredient for U.S. support of Iranian opposition groups?
Babbin: Mr. Bayegan takes this as a sort of academic exercise. I don't want us to condition our support of Iranian opposition groups on some ephemeral affirmation of democratic principals and "civilized political norms" -- whatever that means. We can, and should, choose to support those groups that are proving that they are neither Islamic jihadists nor terrorists of any other stripe, and those which demonstrate their commitment to democracy by agreeing -- now, not later -- to some sort of provisional government for Iran when the mullahs are removed.
To do this, we need what we failed to establish in Iraq: a government in exile, governed by an agreed-on draft constitution that contains provision for basic rights and provides for free elections within a year of the mullahs' fall. We should be proclaiming -- long, hard and continuously -- that regime change in Tehran is our policy, and using every other means we can to increase the pressure on the mullahs, short of military action at this time. Military action may be needed as early as next year if the situation doesn't change dramatically.
I think the MEK is imperfect; maybe it has fewer adherents than other groups. But for us -- or for anyone such as Mr. Bayegan -- to say that no one other than their pal (in his case, the late shah's son) has allegiance of the Iranian people is simply silly. No one -- not the MEK, not Reza Pahlavi, no one - has allegiance among the people of Iran. They have been enslaved for 25 years by the mullahs. I hate to say it, but proclaiming Reza Pahlavi the only accepted voice that "rings true for Iranians" is the same sort of claim we heard from the INC three years ago about Ahmed Chalabi. It wasn't true about Chalabi then, and I don't expect it's true now of Mr. Pahlavi. The Iranian people will decide for themselves in due course. Anyone who claims his guy is the ONLY guy to trust now diminishes his own credibility enormously.
Having said that, I see no reason to not support Mr. Pahlavi or to not rearm and reactivate the MEK. There likely are other groups that can also be activated, supplied and encouraged. The issue, I say emphatically, is not to pick the next government of Iran now. The issue is to ensure that we place enough pressure on the current kakistocracy in Iran to prevent them from obtaining -- by development or purchase -- nuclear weapons. Whether we do it perfectly or not isn't the issue. Results count here, and although there are lines we can't and shouldn't cross, I'm not too picky on how we reach that goal.
I think Mr. Loftus has it right, or at least mostly. The Iranian nuclear issue will be on the front burner by early next year. In the UN we hope -- faint hope that it is -- that the IAEA will do what it is promising now, and report the Iranian nuclear program to the Security Council as a violation of international law and treaty. But to expect the Security Council to do anything serious about Iran is to hope too much. Iran is backed at least by Russia and France (both veto-holding permanent members) and other Security Council members such as Algeria, which like Iran is a supporter of terrorists. We lack the votes to get the Security Council to do anything that will prevent Iran from becoming a nuclear power.
Having said that, we must plan for the next steps to be taken, because they will need to be accomplished before the end of 2005. By then, if not sooner, Iran will have possession of, and/or the ability to manufacture, nuclear weapons. (I should note that more than one source has told me that Iran already has three nuclear weapons it has bought on the black market). We will not have to act unilaterally. Other nations -- especially including Israel -- see Iran as an existential threat. Iraq, though not yet able to defend itself against the Iranian-funded insurgency of Moqtada al-Sadr, has an equal stake in preventing a nuclear Iran. So do all those nations -- from Turkey to Britain - who will soon be in range of Iranian missiles. The UN will fail with respect to Iran just as it has failed in every other challenge in the war on terrorists and the nations that support them. We won't act alone. But we will have to act militarily, and soon.



To continue reading this symposium, Click Here.

Atomic Ayatollahs (Continued)
By Jamie Glazov
FrontPageMagazine.com | September 3, 2004
Loftus: The short term goal is to prevent Iran from having nuclear weapons, the medium term goal is to stop its funding of terrorism, the long term goal is regime change. Lets take them in order:
Short term: IAEA wants (secretly) to refer Iran to the UN for sanctions but lacks the smoking gun. Libya, Pakistan, North Korea or China could easily incriminate Iran, but that would mean outing the entire Arab nuclear game, There are lots of guilty parties: Saudi funding, Egyptian support, Syrian centrifuges, Iraqi nuclear scientists working in Libya, etc. There are a lot of threads to pull apart the tapestry of the Iranian nuclear cover-up.
BUT even if the smoking gun emerges, the big obstacle is the price of oil. Europe imports 90% of its oil from the Arabian peninsula. Arab sanctions are the ones with real teeth. A US naval blockade could easily shut Iran's economy in weeks or months, but in the interim oil prices would skyrocket to $100 per barrel. The US can sit out the price hike with our petroleum reserves, Europe cannot.
Bottom line: if we are to go against Iran, we go alone as usual. My intel friends tell me that the new oddly shaped warhead on the Shahab 3d missile is an exact duplicate of the North Korean nuclear warhead. I think Iran already has one to four nuclear weapons, and is prepared to obliterate Israel in response to any blockade or pre-emptive strike. I see little consensus for a short term strategy to blockade Iran, let alone to launch a primitive attack.
The middle term goal: to stop Iranian support for terrorism. Here there is some hope. The Iraqis have caught Iran by the short hairs in funding Sadr's rebellion. The Iranian Consul General in Karbala has been kidnapped by "unknown forces" and has been talking like a waterfall. The Iranian spies disguised ad journalists and chamber of commerce types have been rounded up. The confessions have been videotaped, the secret codes broken. The new Iraqi government has grounds to say that Iran has declared war, and to call on the Arab states to issue their own sanctions. This has a glimmer of hope. Iran's weak points are its European dependent trade economy, and its fear of geopolitical isolation. They can be hit in the pocketbook. If the Arabs insist, Europe will follow.
Long term: Wait them out. It took 70 years, but the Soviet Union crumbled without a nuclear war. It won't take anywhere near that long for Iran. Iran has a fragile economy, with massive unemployment among the young urban populations. The Mullahs will be swallowed by their own demographics within a decade. Instead of funding the MEK or SAVAK or yet another Shah, let the American Persian community increase their highly effective TV and radio broadcasts to Iran. 75% of the Iranian population is under 25, and they hate the Mullahs with a passion.
These three strategies are not inconsistent. If the Arab states want to avoid exposure for their criminal conspiracy to develop the Islamic Bomb, then the price is Iran. If the Arabs isolate the Persians in punishment for their attack on Iraq, then the Europeans may execute a volte face rather than risk an Arab boycott. Some oil is better than none. Let the deal making begin. We have 36 months before Iran can manufacture an indigenous nuclear stockpile. After that point, they could defeat America.
Bayegan: What Mr.Babbin calls an academic exercise, I call doing one's homework before a headlong plunge into another quagmire in the Middle East. I am surprised at that "whatever that means" cynical tone Mr. Babbin uses to refer to "democratic principles" and "civilized political norms". For thousands of Iranians who have been subject to torture, humiliation and murder by religious tyrants for the past quarter of a century, those values are of infinite and invaluable importance.
Mr. Babbin speaks in the same breath of support for Mr. Pahlavi and re-arming/reactivating MKO. The problem with that argument is that unlike MKO, Reza Pahlavi is advocating a non-violent resistance to the Mullahs and calls for the toppling of the clerical regime through civil disobedience, economic sanctions and political isolation. Mr. Pahlavi has never once promoted a military attack on Iranian soil. Accordingly, any comparison made between him and the leaders of Iraqi National Congress is jejune or outright calumnious. Those Iranians who are supporting his campaign are doing so for his peaceful and democratic approach, and not because they are his pal as Mr. Babbin is suggesting about myself.
I reiterate here that the non-violent political solution and the call for a national referendum are the ONLY acceptable means of a regime change for the majority of Iranians. That is why Americans like Mr. Babbin do well to cultivate the capacity of listening to the Iranian people and spending time to study their true sentiments and aspirations.
For instance, does Mr. Babbin have any idea that his argument that "we have to act militarily and soon" cannot be received with anything except utter repugnance by Iranians and credible leaders of the Iranian opposition? No Iranian opposition leader worth his salt is suggesting (As Ahmed Chalabi did) that the invading armies will be greeted with flowers in the streets of Tehran. An Iraqi style invasion of Iran is what the mullahs need to rally Iranians behind them and further delay the collapse of their hated theocracy.
I agree with Mr. Loftus that Iranians do not need any funding to liberate their country. He also points out an important factor against the survival of the clerical regime when he remarks that "75 percent of the Iranian population is under 25, and they hate the Mullahs with a passion".
This passion is a noble human resistance to oppression and tyranny. It is a laudable, moral fervor that deserves the support and solidarity of every member of international community.
What is toted by the Kerry camp as the 'grand bargain' to dissuade the Islamic Republic from moving towards its WMD objectives is a prime example of a betrayal of the hope and aspirations of Iranian people.
As a matter of fact, the regime in Tehran which felt extremely vulnerable after the ouster of Saddam Hussein has been using the nuclear card to win concessions from the West and continue its reign of terror with impunity. John Edwards' recent overture to Iran that amounts to showering the mullahs with presents and offering them a list of incentives shows that the Democrats have not learned anything from their past mistakes. The war on terror cannot be won as long as the clerical regime continues to rule Iran. The Democrats paid the price of their vacillating policies towards the Mullahs during the presidency of Jimmy Carter. A future President John Kerry cannot expect to fare any better.
Babbin: Before Mr. Bayegan can accuse me of calumniating, he must first prove his assertion that Reza Pahlavi is the anointed future leader of a moderate Iran. That he has not even attempted to do. I repeat: he sounds almost exactly the same as those who asserted that Iraqis would flock around Chalabi as their accepted leader. Having not been in Iran in twenty-five years, Mr. Pahlavi has to prove to have a large and democratically-oriented following before his advocates are taken seriously. That he patently cannot. I have met Mr. Pahlavi, and find him a highly intelligent and engaging man. I have read one of his books, and believe that he is inclined to a new, free and democratic Iran. But that is not enough. Mr. Bayegan's assertions may prove true. I hope they do. But his assertions are merely that: unsupported and not yet susceptible of being taken seriously.
Mr. Bayegan also accuses me of cynicism. He confuses cynicism with realism. I think that those -- such as he -- who ask us to choose between Iranian opposition groups merely on their say so -- have a lot to learn about America. We are learning as we go in this war, and we have learned in Iraq to not believe unsubstantiated claims of broad support by those who aren't in-country. Am I suggesting a "headlong plunge" into the Middle East? My dear chap, the Middle East has taken a headlong plunge into America. We are responding, and not in kind.
We must remove the regime of the mullahs in Tehran. We can and should do so. We have no quarrel with the people of Iran but -- and this is the biggest "but" in the world today -- we must remove that regime soon, on our time table, with or without the acceptance by the Iranian people of the time or means we choose. If they disagree, they should take their grievances out on the repressive regime that holds them in thrall and seeks to do the same with the rest of the world. Mr. Bayegan and others don't have standing to argue with us about how we do what we must do. Our ONLY obligation is to remove the threat of the central terrorist regime in the world in as humane a way as we can.
We wish no harm to the Iranian people, and hope that they will understand that we cannot await their blessing before we act. Mr. Bayegan seems to be saying that we are under some obligation to ourselves, our posterity, or to the Iranians to wait until they say we are doing what they might accept. That reasoning is perfectly circular. If the Iranians had a legitimate voice through which their government spoke, they would already be democratic and not a terrorist threat. But they do not. There is no voice of the moderate Iran that can speak for anyone inside the nation. Both Mr. Loftus and Mr. Bayegan apparently wish to wait for some diplomatic or Iranian-generated action to change what the facts on the ground are now. I believe the time to wait is rapidly running out.
Just Wednesday, the mullahs announced that they are beginning to enrich tons of uranium in defiance of the IAEA and the UN. Mr. Loftus is dreaming if he thinks IAEA "secretly" wants to do something. Even if it were, IAEA's secret dreams can't and won't disarm Iran. We must do it, and very soon. With our allies if some choose to join, alone if we must. And I reiterate, we need not and should not invade Iran. Destruction of the nuclear program is sufficient for now, and can be done from the air. By so doing, we may provide the impetus for a revolution that the Iranian people can mount themselves. If it does, we should support it with money, arms and communication assets. Then, and only then, can a new leader of a free Iran emerge.
FP: Mr. Loftus, last word goes to you. Please comment on the disagreement between Mr. Babbin and Mr. Bayegan and where you stand. And, as a final word, let us assume that President Bush called you today and said: "Mr. Loftus, Iran has become my #1 priority now. I need your advice on what to do." What do you tell the President?
Loftus: I think that perhaps you have seriously underestimated the Kerry strategy. It is a given that Iran will never accept a grand strategy, no matter how many enticements are spread before them. The reason is simple: the bottom line for Kerry's plan is that Iran must dismantle their centrifuge arrays, give up the indigenous mining of yellow cake, and end all enrichment experiments. Even if we offer, as Mr. Kerry has hinted, to provide uranium fuel for free, Iran will still turn the bargain down. Iran needs the enrichment cycle to build nuclear weapons, all else is pretense.
Mr. Kerry knows this, and anticipates the rejection of his Grand Bargain. So why bother? Because we are linking the Grand Bargain to a firm committment from the EU and other Arab states that rejection means an automatic vote for sanctions in the UN. Since 90% of Iran's economy is dependent on oil exports, this is one of the few countries in the world where sanctions have teeth. Shut down the pipelines, blockade the shipping lanes, and Iran's economy collapses in short order. That may be enough to start the revolution from within.
As to bombing from the air, it is not an option. A) we do not know where all the enrichment facilities are located, B) many of the sites are underground beneath civilian areas, and C) the much taunted nuclear bunker buster technology simply will not work after thorough study. Bombing will rally the Iranian people around the Pasdaran, the new SS, and accelerate spending on nuclear weapons. Land invasion is not an option, as Saddam learned.
My advice to the President is that we most go through the motions of offering a Grand Bargain for diplomatic reasons, but plan on its rejection. Several of the Mullahs have already denounced Kerry's proposal, so it is a safe bet to lose. We must get the votes for sanctions against Iran or consider a naval blockade on our own. 90% of Iran's trade is with the EU, and most of that cargo comes by sea. What will the Mullahs do for their people when the foodstocks run out? Let them eat yellowcake?
FP: Jed Babbin, John Loftus and Reza Bayegan, our time is up. Thank you for joining us. We'll see you again soon.


Jamie Glazov is Frontpage Magazine's managing editor. He holds a Ph.D. in History with a specialty in Soviet Studies. He edited and wrote the introduction to David Horowitz's new book Left Illusions. He is also the co-editor (with David Horowitz) of the new book The Hate America Left and the author of Canadian Policy Toward Khrushchev's Soviet Union (McGill-Queens University Press, 2002) and 15 Tips on How to be a Good Leftist. To see his previous symposiums, interviews and articles Click Here. Email him at jglazov@rogers.com.


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Rejecting International Pressure, Iran to Process Uranium
By Joby Warrick
Washington Post Staff Writer
Thursday, September 2, 2004; Page A13
Iran, in a fresh rebuff of demands that it abandon its nuclear ambitions, has decided to process a large quantity of uranium into a precursor ingredient used in making both commercial nuclear fuel and nuclear weapons, the U.N. atomic watchdog agency said yesterday.
The International Atomic Energy Agency, in a confidential report, said Iran intends to convert more than 40 tons of uranium into uranium hexafluoride (UF 6 ) gas, an intermediate step in the complex process of making enriched uranium. The plan, if carried out, would represent a significant step forward for Iran's nuclear program and -- in the view of Bush administration officials -- a growing threat. In theory, that much uranium could yield as many as five crude nuclear bombs.
Administration officials reacted strongly to the revelation, vowing to launch a new effort this month to bring Iran before the U.N. Security Council for international censure. "The United States will continue to urge others . . . to join us in the effort to deal with the Iranian threat to international peace and security," said John R. Bolton, the undersecretary of state for arms control and international security.
Iran emphatically denies seeking nuclear weapons, but it insists it will assert its legal right to develop a commercial nuclear power industry. Although international inspectors have found no hard evidence linking Iran to a nuclear weapons program, its credibility has been battered by numerous disclosures of past attempts to conceal sensitive nuclear research.
Iran has also angered key U.S. allies in Europe by backing away from commitments to freeze components of its nuclear program, including the production of centrifuge machines used in enriching uranium. In an agreement reached last fall with Britain, France and Germany, Iran promised to suspend the production of enriched uranium in return for trade and technical assistance.
Iran's decision to begin the conversion of 37 metric tons (40.8 tons) of raw yellowcake uranium into UF 6 is seen by U.S. officials and many weapons experts as a further flouting of Iran's commitments. Several experts described the quantity as surprising and disturbing.
The revelation was contained in an IAEA report that otherwise contained much favorable news for Iran. The document -- one in a series of periodic updates on the findings of a U.N. investigation of Iran's nuclear program -- gave the Iranians high marks for cooperating with international inspectors. Unlike past reports, it featured no bombshells about past Iranian nuclear activity. It concluded that Iran had "plausibly" explained the existence of some particles of enriched uranium found in several nuclear facilities -- particles that now appear to have entered the country on contaminated equipment purchased on the black market.
With the new report, the Bush administration faces diminishing prospects for finding "smoking gun" evidence of an Iranian nuclear weapons program -- and also, perhaps, for rounding up international support for tough action against Iran, said Jon Wolfsthal, deputy director for nonproliferation studies at the Carnegie Institute for International Peace. "Iran has answered the questions about its past while moving ahead with its enrichment program -- and we don't have a process in place to convince them to give it up," Wolfsthal said. "There's an open stretch of highway leading up to nuclear capability for Iran, and not a roadblock in sight."
? 2004 The Washington Post Company
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International Atomic Energy Agency Board of Governors

GOV/2004/60Date: 1 September 2004 Restricted DistributionOriginal: English

For official use only Item 8(d) of the provisional agenda (GOV/2004/51)
Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran Report by the Director General

1. At its meeting in June 2004, the Board of Governors considered the report submitted by the Director General on the implementation of the Agreement between the Islamic Republic of Iran (hereinafter referred to as Iran) and the Agency for the Application of Safeguards in Connection with the Treaty on the Non-Proliferation of Nuclear Weapons (the Safeguards Agreement)1. That report, published as GOV/2004/34 (1 June 2004) and Corr.1 (18 June 2004), provided a chronology from March 2004, summaries of the outstanding issues, next steps and assessments, and an annex on the Agency's verification activities. 2. On 18 June 2004, the Board of Governors adopted resolution GOV/2004/49, in which it: * acknowledged that Iranian cooperation had resulted in Agency access to all requested locations, including four workshops belonging to the Defence Industries Organisation; * deplored, at the same time, the fact that, overall, as indicated by the Director General's written and oral reports, Iran's cooperation had not been as full, timely and proactive as it should have been, and, in particular, that Iran had postponed until mid-April visits originally scheduled for mid-March -- including visits of Agency centrifuge experts to a number of locations involved in Iran's P-2 centrifuge enrichment programme -- resulting in some cases in a delay in the taking of environmental samples and their analysis; * underlined that, with the passage of time, it was becoming ever more important that Iran work proactively to enable the Agency to gain a full understanding of Iran's enrichment programme by providing all relevant information, as well as by providing prompt access to all relevant places, data and persons; and called on Iran to continue and intensify its cooperation so that the Agency may provide the international community with required assurances about Iran's nuclear activities;
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1 INFCIRC/214.
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* called on Iran to take all necessary steps on an urgent basis to help resolve all outstanding questions, especially that of low enriched uranium (LEU) and high enriched uranium (HEU) contamination found at various locations in Iran, including by providing additional relevant information about the origin of the components in question and explanations about the presence of a cluster of 36% HEU particles; and also the question of the nature and scope of Iran's P-2 centrifuge programme, including by providing full documentation and explanations at the request of the Agency; * welcomed Iran's submission of the declarations under Articles 2 and 3 of its Additional Protocol; and stressed the importance of Iran complying with the deadlines for further declarations required by Articles 2 and 3 of the Protocol, and that all such declarations should be correct and complete; * emphasized the importance of Iran continuing to act in accordance with the provisions of the Additional Protocol to provide reassurance to the international community about the nature of Iran's nuclear programme; and urged Iran to ratify without delay its Additional Protocol; * recalled that in previous resolutions the Board had called on Iran to suspend all enrichment related and reprocessing activities; welcomed Iran's voluntary decisions in that respect; regretted that those commitments had not been comprehensively implemented and called on Iran immediately to correct all remaining shortcomings, and to remove the existing variance in relation to the Agency's understanding of the scope of Iran's decisions regarding suspension, including by refraining from the production of UF6 and from all production of centrifuge components, as well as to enable the Agency to verify fully the suspension; * in the context of Iran's voluntary decisions to suspend all enrichment related and reprocessing activities, called on Iran, as a further confidence building measure, voluntarily to reconsider its decision to begin production testing at the Uranium Conversion Facility (UCF) and also, as an additional confidence building measure, to reconsider its decision to start construction of a research reactor moderated by heavy water, as the reversal of those decisions would make it easier for Iran to restore international confidence undermined by past reports of undeclared nuclear activities in Iran; * recalled that the full and prompt cooperation with the Agency of all third countries was essential in the clarification of certain outstanding questions, notably contamination; * commended the Director General and the Secretariat for their professional and impartial efforts to implement Iran's Safeguards Agreement, and, pending its entry into force, Iran's Additional Protocol, as well as to verify Iran's suspension of enrichment related and reprocessing activities, and to investigate supply routes and sources; * decided to remain seized of the matter. 3. In resolution GOV/2004/49, the Board also requested the Director General to report well in advance of the September Board -- or earlier if appropriate -- on the above issues as well as on the implementation of this and prior resolutions on Iran. The present report is the sixth in a series of written reports addressing the implementation of safeguards in Iran2, and provides the Board with an update of developments since the Director General's last report in June 2004. 2 The initial report to the Board of Governors on this specific matter was provided by the Director General orally at the Board's meeting on 17 March 2003. The Director General subsequently submitted five written reports to the Board: GOV/2003/40, dated 6 June 2003; GOV/2003/63, dated 26 August 2003; GOV/2003/75, dated 10 November 2003; GOV/2004/11, dated 24 February 2004; and GOV/2004/34 dated 1 June 2004 and Corr.1 dated 18 June 2004.
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A. Chronology from June 2004 4. From 29 May to 3 June 2004, Agency inspectors visited a number of workshops in Iran to establish a baseline for monitoring the suspension of production of centrifuge components, held discussions on the P-2 centrifuge programme and visited a workshop where P-2 composite rotor cylinders had been manufactured. 5. During a mission to Iran which took place from 22 to 30 June 2004, the Agency: conducted inspections at the Pilot Fuel Enrichment Plant (PFEP) at Natanz, and at the Uranium Conversion Facility (UCF); carried out complementary access at the Esfahan Nuclear Technology Centre (ENTC); and conducted design information verification at the Fuel Enrichment Plant (FEP) at Natanz and at the Molybdenum, Iodine and Xenon Radioisotope Production (MIX) Facility at the Tehran Nuclear Research Centre (TNRC). 6. On 22 June 2004, during the same mission, the Agency requested access to the Lavisan-Shian site in Tehran which had been referred to in the June 2004 Board of Governors meeting as having been relevant to alleged nuclear activities in Iran before the site was razed after November 2003. The Agency visited the site on 28 June 2004. 7. On 23 June 2004, the Agency received from Iran a letter of the same date stating that Iran "plan[ned] to suspend implementation of the expanded voluntary measures conveyed in [its] Note dated 24 February 2004", and that Iran "thus, intend[ed] to resume, under IAEA supervision, manufacturing of centrifuge components and assembly and testing of centrifuges as of 29 June 2004." In the letter, Iran requested the Agency to "take steps necessary to enable resumption of such operation as of 29 June 2004." 8. On 25 June 2004, the Director General wrote to Iran, referring to its letter of 23 June 2004, and expressing the hope that Iran would "continue to build international confidence through implementing its voluntary decisions to suspend all enrichment related and reprocessing activities" and informing Iran that the Agency would be in contact to clarify the practical implications of the decision of the Iranian authorities. Both letters were circulated to the Board of Governors for information under cover of a Note dated 25 June 2004. 9. On 29 June 2004, the Agency received from Iran a letter dated 27 June 2004 in which, referring to its own letter of 23 June 2003, Iran provided a list of seals which "[have] to be removed from material, components and equipment related to the restart of manufacturing, assembling and testing of gas centrifuge machines." In that letter, Iran also requested the Agency's response regarding "removal of the seals either by the Agency inspectors...or by the operator..." In a letter dated 29 June 2004, the Agency acknowledged receipt of Iran's letter and agreed to the removal of the seals by the operator in the absence of Agency inspectors. 10. From 30 June to 2 July 2004, the Agency met in Vienna with an Iranian delegation to discuss outstanding safeguards implementation issues. At the close of the meeting, Iran and the Agency agreed on actions to be taken in July and August 2004 to achieve progress on the resolution of those issues. 11. As agreed during that meeting, in a letter dated 2 July 2004, the Agency provided Iran with comments on the initial declarations submitted by Iran on 15 June 2004 pursuant to Articles 2 and 3 of the Additional Protocol. On 2 July 2004, the Agency also forwarded to Iran for its comments information that it had acquired through open sources on some dual-use equipment and materials, and associated locations, that could also be used for non-peaceful nuclear applications.
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12. As also agreed during the meeting of 30 June to 2 July 2004, on 5 July 2004, the Agency provided Iran with a list of questions in relation to its centrifuge enrichment programme and asked that the answers be provided in writing by 20 July 2004. 13. During a visit of Agency inspectors to Iran from 6 to 18 July 2004, an Agency team met with Iranian officials to discuss the Agency's comments on Iran's Additional Protocol declarations. The team also visited Natanz to recover nuclear material left over in equipment and piping that had been used in the centrifuge research and development (R&D) programme at the Kalaye Electric Company workshop. 14. During that visit, Iran also returned to the Agency 40 seals which it had removed from equipment and centrifuge components located at Natanz, Pars Trash and Farayand Technique (see para. 9 above). The Agency team also held discussions with Iranian officials on outstanding uranium conversion issues. In addition, the team visited the waste disposal site located at Qom, and performed complementary access at Lashkar Ab'ad, at a uranium production plant located near Bandar Abbas, and at TNRC. 15. On 19 July 2004, the Agency received a letter from Iran dated 15 July 2004 concerning the source of contamination of the room under the roof of the Tehran Research Reactor (TRR). In the letter, Iran provided new information concerning the source of the material involved in the contamination. 16. From 25 July to 2 August 2004, Agency inspectors carried out inspection activities at TRR and PFEP, and at facilities on the Esfahan site, where complementary access was also carried out. At Natanz, the inspectors also visited the administrative building and the centrifuge rotor storage building in connection with the monitoring of Iran's suspension of enrichment related activities. 17. From 3 to 8 August 2004, an Agency team, led by the Director of the Division of Safeguards Operations B (DIR-SGOB), met with Iranian officials in Tehran to discuss the outstanding safeguards implementation issues identified at the meeting of 30 June to 2 July 2004. At the opening of the meeting, Iran provided the Agency with written answers to some of the questions that the Agency had previously sent to Iran. These answers were discussed in detail during the meeting. 18. At the close of the meeting, Iran agreed to complete its written answers and to provide additional documentation to the Agency. On 8 August 2004, Iran provided the Agency with more information and documentation. Following a preliminary review of that information and documentation, the Agency wrote to Iran on 16 August 2004 to request information that remained outstanding. 19. On 16 August 2004, the Agency received a letter from Iran dated 14 August 2004 stating that the operator of UCF was "intending to perform hot test to be started on 19 August 2004." 20. Between 21 and 25 August 2004, discussions at TNRC were held, and complementary access at Karaj and inspections and design information verification at PFEP and UCF were carried out. 21. Between 19 and 30 August 2004, the Agency received from Iran a number of communications forwarding additional information relevant to the outstanding issues as discussed during the 3-8 August 2004 meeting in Iran and responding to the Agency's letter of 16 August 2004.
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B. Outstanding Issues and Assessments Centrifuge programme 22. The Agency has continued to investigate the statements made by Iran regarding the chronology of its P-2 centrifuge enrichment programme (GOV/2004/34, para. 26), particularly as regards the period 1995 to 2002. 23. During the discussions which took place in August 2004, Iran repeated that, although the design drawings of a P-2 centrifuge had been acquired in 1995, no work on P-2 centrifuges was carried out until early 2002 when, according to Iran, the Atomic Energy Organization of Iran (AEOI) management decided that "work on a modified P-2 machine based on a sub-critical rotor design would not hurt," and, in March 2002, a contract to study the mechanical properties of the P-2 centrifuge was signed with a small private company. Iran stated that no feasibility or other preliminary studies or experiments were conducted by Iran during the period between 1995 and 2002. 24. Iranian officials also stated that, in spite of frequent contacts between 1995 and 1999 on P-1 centrifuge issues with the intermediaries (who, according to Iran, had provided both the P-1 and P-2 drawings), the topic of P-2 centrifuges was not addressed at all in those meetings nor in the course of making any other foreign contacts. Iran attributed this to the fact that a decision had been made to concentrate on the P-1 centrifuge enrichment programme, and that, in addition, the AEOI was undergoing senior management and organizational changes during that period of time. 25. During the 3-8 August 2004 meeting, and subsequently, the Agency received from Iran more details on the manufacturing and mechanical testing of the modified P-2 composite rotors under the contract with the private company during the period 2002-2003. The Agency reiterated its previous requests for further information from Iran on the procurement of magnets for the P-2 centrifuges, in particular on the source of all such magnets, with a view to facilitating completion by the Agency of its assessment of the P-2 experiments said to have been carried out by the private company. In a letter dated 30 August 2004, Iran informed the Agency that it was "trying to receive that information which would then be transmitted to the Agency". 26. In connection with the Agency's overall assessment of Iran's P-2 centrifuge enrichment programme, the reasons given by Iran for the apparent gap between 1995 and 2002 do not provide sufficient assurance that there were no related activities carried out during that period. The Agency is continuing its investigations of the supply network. Information in this regard will be essential for confirming the statements made by Iran with regard to the acquisition of detailed P-2 manufacturing drawings in 1995, and for understanding the subsequent developments in connection with Iran's P-2 centrifuge enrichment programme. The investigations into the supply network will also provide an opportunity for the Agency to confirm the accuracy of the information provided by Iran on its P-1 centrifuge enrichment programme. Origin of contamination 27. Iran has continued to maintain that the LEU and HEU particles found at Natanz, the Kalaye Electric Company workshop, Farayand Technique and, more recently, at Pars Trash, are due to contamination originating from imported P-1 centrifuge components. However, a number of unanswered questions remain: * why, if the contamination of the domestically manufactured centrifuge components was due solely to contamination from the imported components, the domestic components showed predominantly LEU contamination, while the imported components showed both LEU and HEU contamination.
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* why, if the source of contamination is the same (imported components), the contamination at PFEP differed from that found at the Kalaye Electric Company workshop and Farayand Technique. * why 36% uranium-235 (U-235) particles were found mainly in three of the locations where the imported components were located, and not at others, and why, at the Kalaye Electric Company workshop, there was a relatively large number of particles of 36% U-235 compared to the number of particles of U-235 with other enrichment levels. 28. For the Agency to be able to resolve the issue of LEU and HEU contamination, more information is needed on the locations where the imported components were manufactured and where they were subsequently used or moved to in transit to Iran (i.e. all locations where contamination of the components might have occurred). 29. While Iran provided some information in October 2003 on intermediaries involved, it continues to maintain that it does not know the origin of the components. During the 3-8 August 2004 meetings, the Agency again discussed this matter with Iran and reiterated its request that Iran make every effort possible to identify the origin of the components and the locations outside of Iran that Iranian officials had visited in the 1990s in connection with centrifuge related issues. Subsequently, Iran provided some additional information on one of those locations. 30. The Agency has also continued its discussions with the State from which most of the contaminated centrifuge components originated. The State has provided the Agency with new information on the results of its investigations into the supplier, which indicate that the components imported by Iran may not all have originated from that State. However, additional work, including swipe sampling by the Agency of equipment, is required by the Agency to help it confirm the origin of the contamination from that equipment and to verify the new information. In connection with this work, information from intermediaries and/or the companies and workshops involved in the production and storage of centrifuge components (including information derived from environmental sampling) is indispensable. The Agency is pursuing this matter through contacts with other States and with companies and individuals. 31. The Agency's analysis to date has shown that most of the HEU contamination found at the Kalaye Electric Company workshop and Natanz correlates reasonably with the HEU contamination found on imported components. Given this analysis, other correlations and model enrichment calculations based on the enrichment process in a possible country of origin, it appears plausible that the HEU contamination found at the Kalaye Electric Company workshop and Natanz may not have resulted from enrichment of uranium by Iran at those locations. Other explanations for this and the LEU contamination continue to be investigated by the Agency. 32. As indicated above, on 19 July 2004, the Agency received a letter from Iran reiterating its previous assertion that the source of contamination of the room under the roof of the Tehran Research Reactor building had been "UF6 which [had] been produced through R&D conversion" (not UF6 imported in 1991, as Iran had initially informed the Agency), but providing additional information on the source of the material which had been used as feed for that conversion. The Agency continues to regard as not technically plausible Iran's explanation that the contamination was due to a leaking bottle. However, the Agency will only be able to pursue this issue if new information becomes available. Uranium conversion experiments 33. Between 1981 and mid-1993, small scale uranium conversion experiments were conducted by Iran at research laboratories at ENTC and TNRC. The Agency has been reviewing the information
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provided by Iran with a view to assessing Iran's declarations regarding these experiments. The Agency has concluded that Iran's statements and declarations regarding the technical scope of its work, the equipment used and the amounts of nuclear material consumed and produced are consistent with what was ascertained by the Agency as a result of its investigations. Laser enrichment 34. The Agency has completed its review of Iran's atomic vapour laser isotope separation (AVLIS) programme and has concluded that Iran's descriptions of the levels of enrichment achieved using AVLIS at the Comprehensive Separation Laboratory (CSL) and Lashkar Ab'ad and the amounts of material used in its past activities are consistent with information available to the Agency to date. Iran has presented all known key equipment, which has been verified by the Agency. For the reasons described in the Annex to this report, however, detailed nuclear material accountancy is not possible. 35. It is the view of the Agency's AVLIS experts that, while the contract for the AVLIS facility at Lashkar Ab'ad was specifically written for the delivery of a system that could achieve 5 kg of product within the first year with enrichment levels of 3.5% to 7%, the facility as designed and reflected in the contract would, given some specific features of the equipment, have been capable of limited HEU production had the entire package of equipment been delivered. The Iranian AVLIS experts have stated that they were not aware of the significance of these features when they negotiated and contracted for the supply and delivery of the Lashkar Ab'ad AVLIS facility. They have also provided information demonstrating the very limited capabilities of the equipment delivered to Iran under this contract to produce HEU (i.e. only in gram quantities). Plutonium separation experiments 36. As of the last report to the Board, there remained a number of questions concerning the dates and quantities of material involved in the plutonium separation experiments carried out by Iran (GOV/2004/34, Annex, paras 15-16) 37. Iran has now agreed with the Agency's estimate of the amounts of plutonium that had been produced by irradiation (milligram quantities). During the August 2004 discussions, Iran explained the reasons for the high level of americium-241 (Am-241) and the plutonium-240 (Pu-240) contamination found in samples taken from a used glove box stored at Esfahan. As noted in the previous report, there are indications that the age of the plutonium in solutions could be less than the 12-16 years declared by Iran; that is to say, that the separation activities were carried out more recently than that. The Iranian officials maintain their earlier statements regarding the age of the plutonium. The Agency is continuing to look into this matter. Hot cells 38. In response to questions by the Agency about past efforts by Iran to procure hot cell windows and manipulators, and the specifications associated with those items, Iran informed the Agency that there had been a project for the construction of hot cells for the production of "long lived radioisotopes" but that it had been abandoned due to procurement difficulties. In August 2004, Iran presented to the Agency detailed drawings that Iran had received from a foreign company in 1977 for hot cells which were to have been constructed at Esfahan. Iran stated that it had not yet made more detailed plans for hot cells for the Iran Research Reactor (IR-40) site at Arak, but that it had used information from those drawings as the basis for specifications in its efforts to procure manipulators for hot cells intended for the production of cobalt and iridium isotopes. In a letter dated 19 August 2004 Iran reiterated its previous statement that the hot cell project at Arak consisted of nine hot cells -- four for the
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"production of radioisotopes", two for the production of cobalt and iridium3, and three for "waste management processing" -- and would require ten back-up manipulators. 39. The Agency will continue to follow up on this issue with a view to achieving a better understanding of Iran's plans with respect to hot cells. Additional Protocol 40. The Agency is reviewing the initial declarations submitted by Iran pursuant to its Additional Protocol on 21 May 2004, as well as the clarifications and supplementary information provided by Iran following the detailed discussions in July and August 2004 between the Agency and Iran. Investigation of supply routes and sources 41. As requested by the Board in resolution GOV/2004/21, the Agency is continuing to pursue its investigation of the supply routes and sources of conversion and enrichment technology and the sources of related equipment and nuclear and non-nuclear materials. The Director General will provide more information to the Board about the results of this investigation upon its completion. Transparency visits and discussions 42. The Lavisan-Shian site in Tehran was referred to in the June 2004 meeting of the Board of Governors in connection with alleged nuclear related activities and the possibility of a concealment effort through the removal of the buildings from that site. 43. As indicated above, in response to an Agency request, Iran provided access to that site. Iran also provided access to two whole body counters, and to a trailer declared to have been previously located on that site and to have contained one of the whole body counters. The Agency took environmental samples at these locations. Iran also gave the Agency a description and chronology of activities carried out at the Lavisan-Shian site. According to Iran, a Physics Research Centre had been established at that site in 1989, the purpose of which had been "preparedness to combat and neutralization of casualties due to nuclear attacks and accidents (nuclear defence) and also support and provide scientific advice and services to the Ministry of Defence." Iran provided a list of the eleven activities conducted at the Centre, but, referring to security concerns, declined to provide a list of the equipment used at the Centre. Iran stated further that "no nuclear material declarable in accordance with the Agency's safeguard[s] was present" and that "no nuclear material and nuclear activities related to fuel cycle [were] carried out in Lavisan-Shian." 44. According to Iran, the site had been razed in response to a decision ordering the return of the site to the Municipality of Tehran in connection with a dispute between the Municipality and the Ministry of Defence. Iran recently provided documentation to support this explanation. 45. The documentation provided by Iran is currently being assessed, and the environmental samples are being analysed. 46. In accordance with Agency practice in connection with its evaluation of other States' nuclear programmes, the Agency has discussed with the Iranian authorities open source information relating to dual use equipment and materials which have applications in the conventional military area and in the civilian sphere as well as in the nuclear military area. The Agency welcomes Iran's willingness to discuss these topics. 3 Cobalt-60 and iridium-192 have half-lives of 5.2 years and 74 days, respectively.
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Suspension 47. In its Note Verbale of 29 December 2003, Iran informed the Agency that, with immediate effect, it would suspend: * the operation and/or testing of any centrifuges at PFEP at Natanz; * further introduction of nuclear material into any centrifuges; * installation of new centrifuges at PFEP and installation of centrifuges at FEP. 48. Iran also indicated that it would withdraw nuclear material from any centrifuge enrichment facility if and to the extent practicable. It further stated that: * it currently was not constructing any type of gas centrifuge enrichment facility at any location in Iran other than the facility at Natanz, nor did it have plans to construct new facilities capable of isotopic separation during the suspension; * it had dismantled its laser enrichment projects and removed all related equipment; * it was not constructing or operating any plutonium separation facility; * during the period of suspension, it did not intend to make new contracts for the manufacture of centrifuge machines and their components; * the Agency could fully supervise storage of all centrifuge machines assembled during the suspension period; * Iran did not intend to import centrifuge machines or their components, or feed material for enrichment processes, during the suspension period; and * there was no production of feed material for enrichment processes in Iran. 49. On 24 February 2004, Iran invited the Agency to verify its further voluntary decisions to: * suspend the assembly and testing of centrifuges; and * suspend the domestic manufacture of centrifuge components, including those related to the existing contracts, to the furthest extent possible (and said that any components that were manufactured under existing contracts that could not be suspended would be stored and placed under Agency seal). 50. Iran also confirmed that the suspension of enrichment activities applied to all facilities in Iran. 51. On 21 May 2004, Iran informed the Agency that it had not, at any time, made any undertaking not to produce feed material for the enrichment process, and that its voluntary and temporary suspension did not include suspension of the production of UF6. 52. As previously indicated in the Director General's report to the Board (GOV/2004/34, para. 42; Annex, paras 60-61), Iran informed the Agency that it was conducting hot tests at UCF that would generate UF6 product. One such test, which generated about 30-35 kg UF6, was conducted between May and June 2004. Another larger test involving 37 tonnes of yellowcake is planned for August/September 2004. 53. As indicated above, Iran notified the Agency on 23 June 2004 of its intention to resume, "under IAEA supervision, manufacturing of centrifuge components and assembly and testing of centrifuges". Following this, the seals that had been used by the Agency as one of the measures for monitoring Iran's suspension of the manufacture, assembly and testing of centrifuge components at Natanz, Pars
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Trash and Farayand Technique were removed by Iran and returned to the Agency during its visit to Iran between 6 and 18 July 2004. As of mid-August 2004, about 70 rotors had been newly assembled and tested, and were shown to the Agency. The Agency is discussing with Iran the necessary arrangements for the Agency to exercise "supervision". In that regard, the Agency has proposed that it seal the tested rotors, a measure which Iran has not to date accepted. It must be noted that, in the absence of such seals, the Agency's supervision of the activities identified by Iran cannot be considered effective. 54. Since the last report of the Director General to the Board of Governors, the Agency has been able to verify that there has been no operation or testing of any centrifuges at PFEP; that there has been no further introduction of nuclear material into any centrifuges at PFEP; that there has been no installation of new centrifuges at PFEP or installation of centrifuges at FEP; and that there has been no reprocessing at the Jabr Ibn Hayan Multipurpose Laboratories (JHL). 55. The Agency has also been able to reconfirm that it has not observed to date at TNRC, Lashkar Ab'ad, Arak, the Kalaye Electric Company workshop, Natanz or UCF any activities inconsistent with the Agency's understanding of Iran's current suspension undertakings. C. Findings and Next Steps 56. The Agency welcomes the new information provided recently by Iran in response to the Agency's requests, although the process of providing information needs, in certain instances, to be accelerated. In some cases, such as Iran's clarifications related to its initial declarations pursuant to its Additional Protocol, the provision of new information has been prompt. In other cases, sufficiently detailed information has, despite repeated requests, been provided so late that it has not been possible to include an assessment of its sufficiency and correctness in this report. The Agency also welcomes the cooperation by Iran in providing access to locations in response to Agency requests, including at the Lavisan-Shian site. 57. Although the Agency is not yet in a position to draw definitive conclusions concerning the correctness and completeness of Iran's declarations related to all aspects of its nuclear programme, it continues to make steady progress in understanding the programme. In this regard, the Agency's investigations have reached a point where, with respect to two aspects previously identified by the Agency as requiring investigation (i.e. Iran's declared laser enrichment activities and Iran's declared uranium conversion experiments), further follow-up will be carried out as a routine safeguards implementation matter. 58. Two issues remain key to understanding the extent and nature of Iran's enrichment programme: * The first issue relates to the origin of uranium contamination found at various locations in Iran. As stated above, some progress has been made towards ascertaining the source of the HEU contamination found at the Kalaye Electric Company workshop and Natanz. From the Agency's analysis to date, it appears plausible that the HEU contamination found at those locations may not have resulted from enrichment of uranium by Iran at the Kalaye Electric Company workshop or at Natanz. However, the Agency will continue to pursue the identification of sources and reasons for such contamination. The Agency will also continue with its efforts to understand the source of the LEU contamination found in various locations in Iran, including on domestically manufactured components.
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* The second issue relates to the extent of Iran's efforts to import, manufacture and use centrifuges of both the P-1 and P-2 design. While the Agency has gained a better understanding of Iran's efforts relevant to both designs, additional work by the Agency will be necessary, inter alia, to confirm Iran's statements regarding the absence of P-2 centrifuge related activities in Iran between 1995 and 2002 and regarding P-2 centrifuge procurement related activities. 59. There are other issues that will also require further follow-up, for example the timeframe of Iran's plutonium separation experiments. 60. The Agency has been able to verify Iran's suspension of enrichment related activities at specific facilities and sites, and has been able to confirm that it has not observed, to date, any activities at those locations inconsistent with its understanding of Iran's current suspension undertakings. 61. It is important for Iran to support the Agency's efforts to gain a full understanding of all remaining issues by continuing to provide access to locations, personnel and information relevant to safeguards implementation in response to Agency requests -- as well as by proactively providing any additional information that could enhance the Agency's understanding of Iran's nuclear programme. 62. The Agency welcomes the cooperation of other States in response to Agency requests, which is key to the Agency's ability to resolve some of the outstanding issues. Information received to date from other States has proven useful in understanding aspects of the uranium contamination found in Iran. The Agency will continue to request States to actively assist the Agency in resolving these issues. 63. The Director General will report to the Board as appropriate and not later than the November 2004 meeting of the Board.

Annex Verification Activities A. Uranium Conversion - Experiments and Testing 1. Between 1981 and mid-1993, Iran conducted a variety of small scale uranium conversion experiments which encompassed the conversion of uranium ore concentrate (UOC) to ammonium diuranate (ADU) and UO2, the conversion of UOC to ammonium uranyl carbonate (AUC), the conversion of uranyl nitrate (UN) directly to UO3, the conversion of UO2 to UF4 through wet and dry processes and the conversion of UF4 to UF6. During the period 1995 to 2002, techniques to convert UF4 to uranium metal were developed and, during the period 1997 to 2002, research and development on processes in connection with the Uranium Conversion Facility (UCF) at Esfahan was also conducted. 2. These activities, the time periods during which they were conducted, the quantities of nuclear material used and the quantities of products and wastes are summarized in the following table. PROCESS TIME PERIODS DISPOSITION OF NUCLEAR MATERIAL4 Conversion of UOC to ADU (ENTC) 1983 to mid-1987 49.6 kg imported U3O8 used to produce 36 kg ADU Conversion of ADU to UO2 (ENTC) Early 1985 to mid-1987 34 kg of the 36 kg ADU used to produce 28 kg of UO2; 2 kg ADU unused 12 kg of the 28 kg UO2 used in subsequent experiments, 16 kg UO2 unused Total of 6.7 kg U as liquid waste from UOC-ADU and ADU-UO2 conversion disposed of at Qom Conversion of UOC to AUC (ENTC) 1986 to mid-1987 About 5.5 kg imported UOC used to produce about 7 kg AUC Conversion of UOC to AUC (TNRC) 1989 to end 1992 About 2.7 kg imported UOC used to produce about 4.5 kg AUC Wet process production of UF4 (TNRC) 1990 to mid-1991 12.8 kg imported UOC used to produce 10 kg UF4; waste disposed of at Qom
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4 For the sake of simplicity, natural and depleted uranium have been combined.
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Dry process production of UF4 (TNRC) End 1991 to early 1992 About 2.7 kg imported UO2 used to produce about 3 kg UF4; 2.5 kg UF4 remains on inventory; 0.5 kg waste disposed of at Qom Conversion of UF4 to UF6 (TNRC) Mid-1991 to mid-1993 9.8 kg imported UF4 used to produce 6.9 kg UF6; 2.7 kg U disposed of as waste Conversion of UN to UO3 (TNRC) Second half 1992 2.2 kg imported UOC used to produce 0.3 kg UO3; waste disposed of at Qom Pulse column experiments (TNRC) Early 1997 to early 2002 22.5 kg UO2 used for various experiments, out of which equivalent of 8.6 kg UO2 remains as liquid waste; equivalent of 14 kg UO2 disposed of as waste at Qom Conversion of UF4 to uranium metal (TNRC) 1995 to early 2002 358.7 kg UF4 (mainly imported) used to produce 126.4 kg uranium metal; 3 kg uranium metal recovered from waste 3. With the exception of the studies on uranium metal conversion and pulse columns, the small scale conversion activities started in the early to mid-1980s and continued for several years. The last of these, the UF4-UF6 experiments, ended in June of 1993. There are inherent difficulties with investigating activities which ended over a decade ago, and it is not possible to verify in detail the chronologies and descriptions of the experiments which took place in Iran. Therefore, the Agency's activities have been focused on assessing the consistency of information provided by Iran and examining remaining equipment and nuclear material. 4. Very detailed documentation was provided for some of the conversion experiments and tests, for example, the UO2-UF4, UF4-UF6, UN-UO3 and uranium metal activities. Less detailed documentation was provided for the older activities, such as those associated with the UOC-ADU, ADU-UO2 and UOC-AUC activities. The documentation was supplemented by technical meetings with scientific staff involved with and responsible for these activities. Except for the equipment associated with the UOC-AUC experiments, equipment used during the experiments was examined and, where possible, compared with documentation. Inventory examination and verification activities, including the recovery of nuclear material hold-up from the equipment, were performed to confirm, where possible, the quantities of nuclear material used, produced and lost as waste. 5. An issue of concern since the outset of the investigation of the small scale conversion activities has been the very small quantities of nuclear material used and produced relative to the size, quality and capacity of the equipment involved, particularly in connection with the UOC-ADU, ADU-UO2, UO2-UF4 and the UF4-UF6 projects. The large scale experimental equipment, if used for full scale production, could consume and produce far in excess of what was declared to have been consumed and produced during the declared life of these activities. 6. A related issue is the use of the equipment during the period between when the activities were said to have ceased (1991-1993) and April 1999, when the equipment is said to have been dismantled and put into storage. Iran has stated that the equipment was kept in storage until January 2004, when it was examined by the Agency and the nuclear material hold-up recovered therefrom, and the equipment was destroyed at the initiative of the Iranian authorities.
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7. Examination of the equipment prior to and during its destruction showed that the equipment was in very good condition and appeared to have been little used, which is consistent with the declared scale of its use. B. Irradiation and Reprocessing Experiments B.1. Plutonium separation 8. As described in the Director General's report to the March 2004 Board meeting (GOV/2004/11, para. 21), Iran had irradiated depleted UO2 targets and reprocessed them on the site of TNRC. According to Iran, 6.9 kg of UO2 had been irradiated, 3 kg of which were subsequently reprocessed to separate plutonium, and the remaining 3.9 kg had been buried in containers at the site. 9. However, on the basis of information available to it, the Agency concluded (GOV/2004/34, para. 36; Annex, paras 15-16): that the amount of plutonium declared by Iran had been understated (quantities in the milligram range rather than the microgram range as stated by Iran); that the plutonium samples taken from a glove box said to have been involved had plutonium-240 abundance higher than that found in the plutonium solution bottles presented; that the age of the plutonium solution in the bottles appeared to be less than the declared 12-16 years; and that there was an excess amount of americium-241 in samples. 10. With regard to the quantity of plutonium in solution, a recalculation by Iran based on corrected irradiation data and using a corrected equation indicated a quantity of plutonium in the range of that estimated by the Agency. During the meeting in Iran on 16 May 2004, Iran acknowledged that its theoretical estimations of the produced plutonium had been understated and accepted the Agency's estimate as being correct. 11. The age of the plutonium solutions was discussed during the meetings that took place between 3 and 8 August 2004. The Agency explained in detail the methodology it had used for dating the plutonium that had been separated, and the additional on-going work to validate the results. The Iranian officials reiterated their previous statement that the experiments had been completed in 1993 and that no plutonium had been separated since then. The Agency agreed to analyse the available data further. 12. Iran also stated that plutonium with higher Pu-240 abundance originated from work carried out between 1982 and 1984 at the Radiochemistry Laboratory of the TNRC to produce smoke detectors using Am-241. This, in Iran's view, not only explained the Pu-240 contaminant, but also the high Am-241 content in the samples. Iran stated that the Am-241 had been imported from abroad prior to the Iranian revolution in 1979, and explained that, in 1990, the glove box that had been used in connection with the Am-241 was transferred to the building where plutonium separation took place, but that it had been used for training purposes and not for plutonium experiments. According to Iran, that glove box, along with others, was moved in 2000 to a warehouse at ENTC. 13. The overall assessment with respect to the plutonium experiments is pending finalization of the results of the plutonium dating.
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B.2. Polonium-210 (Po-210) production 14. The Agency has continued to follow up the explanations given by Iran on the purposes of the irradiation of bismuth metal samples that took place in TRR between 1989 and 1993 (GOV/2004/34, Annex, paras 17-19). Iran has reiterated its statement that when the project "Po-210 production by Bismuth irradiation in NRC Reactor" was approved by the Nuclear Research Centre (NRC) (later renamed the Tehran Nuclear Research Centre) in 1988, the researcher, in his project proposal, had only referred to a potential application of radioisotope batteries. 15. The Agency had previously requested further documentary information to support Iran's claims that the purpose of the project was to study the production of Po-210 on a laboratory scale only, and that there were no other clearly defined objectives or other projects that dealt with the application of Po-210. The Agency had also requested to see the original of the project proposal. Iran stated that the original documentation could not be found, but provided a statement by the Director of NRC certifying that the copy provided to the Agency, as well as the copy of the letter of approval by the former Directors of NRC also provided to the Agency, were "correct and accurate and authentic." 16. Iran subsequently reiterated in writing that it "does not have project for neither production of Po-210 nor production of neutron sources, using Po-210" and that "there [had] not been in the past any studies or projects on the production of neutron sources using Po-210". The Agency is still assessing the information provided by Iran. C. Uranium Enrichment C.1. Gas centrifuge enrichment 17. As described in GOV/2004/34 (Annex, para. 21), Iran has acknowledged that 1.9 kg of UF6 contained in two small cylinders received from abroad in 1991 had been used to test centrifuges at the Kalaye Electric Company workshop. During a visit to Natanz on 10-11 July 2004, Agency inspectors, with the cooperation of Iran, recovered about 650 g of uranium from the dismantled equipment from the Kalaye Electric Company workshop. The recovered material is currently being analysed. 18. In late May 2004, the Agency visited the workshop where Iran states the composite rotor cylinders for the modified P-2 design had been manufactured. The Agency concluded that the cylinders had in fact been manufactured at the workshop, and that only very limited technical capability exists there. In late May/early June 2004, further discussions were held with the owner of the private company that had received a contract from the AEOI to investigate the P-2 design. The detailed discussions covered the chronology of events that took place between 1995, when Iran says the P-2 centrifuge drawings were received from intermediaries, and 2002, when the contract was signed, including the work carried out by the private company and any development work. 19. During the 3-8 August 2004 meeting, and subsequently, the Agency received from Iran more details on the manufacturing and mechanical testing of the modified P-2 composite rotors under the contract with the private company during the period 2002-2003. The Agency reiterated its previous requests for further information from Iran on the procurement of magnets for the P-2 centrifuges, in particular, on the source of all such magnets, with a view to facilitating completion by the Agency of its assessment of the P-2 experiments said to have been carried out by the private company. In a letter dated 30 August 2004, Iran informed the Agency that it was "trying to receive that information which would then be transmitted to the Agency."
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20. On 8 August 2004, the Agency received a written communication from Iran outlining in more detail key dates of the P-2 related work. More detail was also provided about the enquiries made by the contractor concerning potential procurements from abroad. 21. The reasons given by Iran for the apparent gap between 1995 and 2002 do not provide sufficient assurance that there were no related activities carried out during that period, given that Iran had acquired a full set of drawings in 1995, and given that the owner of the private company was able to make the modifications necessary for the composite cylinders within a short period after early 2002 when, according to Iran, he had seen the drawings for the first time. The Agency is attempting to verify this information, inter alia, through the network of suppliers. C.1.1. Origin of contamination 22. As described in GOV/2004/34 (Annex, paras 25-31), environmental samples taken by the Agency at Natanz and at the Kalaye Electric Company workshop (and, more recently, Pars Trash) revealed particles of natural uranium, LEU and HEU that called into question the completeness of Iran's declarations about its centrifuge enrichment activities. The following unanswered questions remained to be resolved: * Analysis of samples taken from domestically manufactured centrifuge components showed predominantly LEU contamination, while analysis of samples from imported components showed both LEU and HEU contamination. It is still not clear why the components would have different types of contamination if, as Iran states, the presence of uranium on domestically manufactured components is due solely to contamination originating from imported components. * The types of uranium contamination found at the Kalaye Electric Company workshop and at Farayand Technique differ from those at PFEP at Natanz, even though Iran has stated that the source of contamination in both cases is the imported P-1 centrifuge components. * Environmental samples showing the presence of uranium particles enriched to 36% U-235 were found mainly in one room in the Kalaye Electric Company workshop and on the balancing machines which had been relocated from the Kalaye Electric Company workshop to Farayand Technique, both of which locations seemed to be contaminated by more than trace quantities of that material. Samples were also taken at the centrifuge assembly workshop at Natanz where Iran stated that the balancing machines had been located between February and November 2003. 23. Another distinct particle cluster of about 54% U-235, with U-236 contamination, was identified in samples taken from the surfaces of imported centrifuge components, which tends to support Iran's assertion that the source of that contamination had been imported components. However, further assessment is required to understand why 54% particles were also found in a sample collected from the chemical traps of the PFEP, which had not yet commenced operation at the time the sample was taken. 24. Since the issuance of the last report to the Board, the Agency and the State from which most of the imported P-1 centrifuges originated have, in a cooperative effort, continued to share their respective analytical results. The results provided by the State indicate that not all HEU found in the samples taken in Iran may have originated in that State. However, additional work, including swipe sampling by the Agency of equipment at appropriate locations, is required by the Agency to help it confirm the origin of the contamination from that equipment and to verify this new information. The Agency has also been in contact with a third State with a view to facilitating the resolution of the contamination questions.
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25. In April 2004, the Agency was able to visit two locations in Tehran which Iran declared as also having been involved in the centrifuge R&D programme and where mechanical testing of centrifuge rotors was said to have been carried out. In the course of these visits, environmental samples were taken which also indicated the presence of HEU particles in the tested rotors for the P-1 centrifuge programme. Iran states that the R&D involved the use of imported P-1 centrifuge components and that they were likely to have been the source of the contamination. This matter was discussed again with the Iranian authorities in August 2004, and additional samples were taken from those components. 26. Iran maintains its assertion that it has not enriched uranium to more than 1.2% U-235 using centrifuge technology, and that it has not had and does not have any HEU. 27. The Agency's analysis to date has shown that most of the HEU contamination found at the Kalaye Electric Company workshop and Natanz correlates reasonably with the HEU contamination found on imported components. Given this analysis, other correlations and model enrichment calculations based on the enrichment process in a possible country of origin, it appears plausible that the HEU contamination found at the Kalaye Electric Company workshop and Natanz may not have resulted from enrichment of uranium by Iran at those locations. Other explanations for this and the LEU contamination continue to be investigated by the Agency. 28. With regard to the outstanding question relating to UF6 contamination in the room under the roof of the Tehran Research Reactor (TRR) building (see GOV/2004/34, para. 30; Annex, paras 21-23; GOV/2003/63, paras 17-19), Iran originally attributed the contamination to the leakage of small bottles of UF6 that had been imported in 1991. Subsequently, however, Iran acknowledged that this was not the case, as that material had been used for P-1 centrifuge tests at the Kalaye Electric Company workshop. In a letter dated 4 February 2004, Iran stated that "for a period of time 2S bottles of UF6 [imported in 1991] as well as UF6 bottles from conversion R&D programme had been stored in this storage. It is most probable that the particles, which have been found in the samples [taken by the Agency], could be the result of leakage of UF6 bottles from R&D conversion, which have been kept in this storage from 1997 to 1998." It was understood from Iran's communication that the "conversion R&D programme" to which Iran refers in its letter of 4 February 2004 is the conversion between 1991 and 1993 of UF4 which had been imported in 1991 to UF6, as referred to in GOV/2003/75 (Annex 1, Table 1 and para. 23). 29. On 19 July 2004, the Agency received a letter from Iran dated 15 July 2004, in which Iran reiterated the statement it made in its 4 February 2004 letter that the source of contamination of the room under the roof of the Tehran Research Reactor building had been "UF6 which [had] been produced through R&D conversion", but confirmed the Agency's understanding about the source of the material which had been used as feed for that conversion process. During the Agency's August 2004 visit, the team re-visited the room. Based on all information presently available to the Agency, its current assessment remains as stated in para. 23 of the Annex to GOV/2003/34 that the Agency continues to regard as not technically plausible Iran's explanation that the contamination was due to a leaking bottle. C.2. Laser enrichment 30. As reported earlier (GOV/2003/75, Annex 1, para. 59), Iran in its letter dated 21 October 2003 acknowledged that, starting in the 1970s, it had had contracts related to laser enrichment using both atomic vapour laser isotope separation (AVLIS) and molecular laser isotope separation (MLIS) techniques with foreign entities from four countries: * 1975 -- a contract for the establishment of a laboratory to study the spectroscopic behaviour of uranium metal; this project had been abandoned in the 1980s as the laboratory had not functioned properly.
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* Late 1970s -- a contract with a second supplier to study MLIS, under which four carbon monoxide (CO) lasers and vacuum chambers were delivered, but the project had ultimately been terminated due to the political situation before major development work had begun. * 1991 -- a contract with a third supplier for the establishment of a "Laser Spectroscopy Laboratory " (LSL) and a "Comprehensive Separation Laboratory" (CSL), where uranium enrichment would be carried out on a milligram scale based on the AVLIS process. The contract also provided for the supply of 50 kg natural uranium metal. * 1998 -- a contract with a fourth supplier to obtain information related to laser enrichment, and the supply of relevant equipment. However, due to the inability of the supplier to secure export licences, only some of the equipment was delivered (to Lashkar Ab'ad). 31. In August 2004 Iran provided additional documentary evidence to support the descriptions previously provided by it with respect to its laser programme. Further discussions were held with Iranian authorities between 3 and 8 August 2004 during the meetings in Tehran. 32. With regard to the first two contracts, Iran has stated that the laser spectroscopy laboratory and the MLIS laboratory were never fully operational. These statements are supported by the information obtained by the Agency thus far from the suppliers, from the inspection of the declared equipment, from interviews with the scientists involved and from the results of environmental sampling analysis. 33. With regard to the third contract, Agency experts have reviewed a number of documents provided by Iran in May and August 2004 on the operation of the LSL and CSL prior to their dismantlement in 2000. Discussions have also been held with Iranian officials on this matter, and environmental samples taken and the results assessed. The Agency's review indicates that the equipment at the CSL operated fairly well until 1994, when foreign scientists completed their work. According to Iran, "the enrichment separation envisaged in the contract [for the CSL], and in some experiments higher enrichment were achieved in mgr" (the contract provided for "getting one milligram Uranium enriched with 3% concentration of U235 in no longer than eight hours"). As confirmed in an analysis, provided to the Agency, that had been carried out by the foreign laboratory involved in the project, the highest average enrichment achieved was 8%, but with a peak enrichment of 13%. 34. As described earlier, Iran had received 50 kg uranium metal as part of the third contract. According to the information provided to the Agency, a total of 8 kg uranium metal was used in LSL and CSL experiments. However, according to Iran, 500 g of it was evaporated in the experiments, in the course of which milligram quantities of uranium were collected. If, as declared by Iran, the evaporated uranium and collectors had been discarded with wastes, mainly at the Qom disposal site (which the Agency has visited twice), recovery of the small quantities of nuclear material involved would not be feasible and therefore accurate nuclear material accountancy is not possible. 35. According to Iran, the LSL and CSL laboratory experiments carried out between 1994 and 2000 were unsuccessful due to continuous technical problems encountered with copper vapour lasers (CVLs), electron beam guns or dye lasers. Examination by the Agency of the laboratory notebook and other supporting documents provided by Iran confirms Iran's statement that isotope separation was not successful during that period. 36. The fourth contract was for the supply of AVLIS equipment to Lashkar Ab'ad. Iran stated that, due to the inability of the supplier to secure export licences for some of the equipment (in particular, the CVLs and dye lasers, some collector parts, the electron beam gun and the power sources), only some of the equipment (including a large process vessel with supporting diffusion pumps and some diagnostics instruments), along with some training and documentation, was provided under the
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contract. Iran has stated that it made attempts to procure the missing equipment, such as additional CVLs and electron beam guns, with limited success. 37. According to Iranian officials, as a consequence of these difficulties, Iran took advantage of the existing CVLs and dye lasers from CSL, and installed them in the pilot scale vessel in Lashkar Ab'ad where, in late 2002, a total of four runs with uranium feed using a total of about 500 g uranium metal were carried out. As evidence to support this statement, Iran has presented laboratory notebooks of one of the scientists involved in these activities. As described earlier, the Agency has taken environmental samples, and metal parts were taken from the chamber, with a view to determining whether enrichment levels higher than the 0.8% U-235 declared by Iran were achieved. The results of the Agency's analysis indicate enrichment levels (0.99% + 0.24% U-235) consistent with those declared by Iran. 38. While the contract for the AVLIS facility at Lashkar Ab'ad was specifically written for the delivery of a system that could demonstrably achieve enrichment levels of 3.5% to 7%, it is the opinion of Agency experts that the system at Lashkar Ab'ad, as designed and reflected in the contract, would have been capable of HEU production had the entire package of equipment been delivered. In that connection, the experts point to the Lashkar Ab'ad AVLIS vacuum vessel, which incorporated a number of features specific to HEU separation work, including: * an ion trap for the extraction of ion impurities for increased HEU yield; and * a collector assembly designed for the relatively low throughput of HEU. 39. In response to the Agency's questions in connection with this assessment, Iran referred to the contract and the design parameters contained therein, which provide that the design was guaranteed by the supplier to "have actual production of at least 5 kg of a product within the first year after installation. The product will be 3.5% up to 7% enriched." Iran also provided information demonstrating the very limited capabilities of this particular equipment delivered to Iran under this contract to produce HEU (i.e. only in gram quantities). Iranian AVLIS researchers maintain that they were not aware of the significance of these features when they negotiated and contracted the supply and delivery of the Lashkar Ab'ad AVLIS facility. D. Heavy Water Reactor Programme D.1. Heavy Water Reactor IR-40 40. As referred to in the report of the Director General to the March 2004 Board meeting (GOV/2004/11, para. 56), Iran has provided preliminary design information on the IR-40, which is to be constructed at Arak. Iran has also provided information on the IR-40 pursuant to Articles 2.a.i. and 2.b.i. of its Additional Protocol. Iran's declarations concerning R&D activities related to the design of the heavy water reactor were further discussed in the meetings in Tehran which took place in July and August 2004, following upon which, Iran provided additional information. That information is being reviewed by the Agency. D.2. Hot Cells 41. In response to questioning by the Agency about past efforts by Iran to procure hot cell windows and manipulators, and the specifications associated with those items, Iran informed the Agency that
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there had been a project for the construction of hot cells for the production of "long lived radioisotopes" but that it had been abandoned due to procurement difficulties. In August 2004, Iran presented to the Agency detailed drawings that Iran had received from a foreign company in 1977 for hot cells which were to have been constructed at Esfahan. Iran stated that it had not yet made more detailed plans for hot cells for the IR-40 complex at Arak, but that it had used information from those drawings as the basis for specifications in its efforts to procure manipulators for hot cells intended for the production of cobalt and iridium isotopes. In a letter dated 19 August 2004 Iran reiterated its previous statement that the hot cell project at Arak consisted of nine hot cells -- four for the "production of radioisotopes", two for the production of cobalt and iridium5, and three for "waste management processing" -- and would require ten back-up manipulators. The Agency is continuing to assess the information provided by Iran. E. Implementation of the Additional Protocol E.1. Declarations 42. Iran has continued to act as if its Additional Protocol is in force. Following receipt of the initial declarations submitted by Iran on 21 May 2004 under the Additional Protocol, the Agency began its review of the declarations and, on 2 July 2004, provided comments to Iran on those declarations. During the early July 2004 visit of inspectors to Iran, the Agency reviewed its comments with Iran. During the Agency's August 2004 visit to Iran, additional comments were provided by the Agency to Iran and a number of revisions requested, which Iran agreed to provide by mid-August 2004. Clarifications were also sought by Iran on the interpretation of some of the provisions of the Additional Protocol. The Agency and Iran intend to revisit some of the issues raised by Iran in the near future. E.2. Complementary Access 43. Since the June 2004 Board meeting, the Agency has carried out complementary access in Iran on six occasions at five locations: twice at ENTC, and once each at TNRC, Lashkar Ab'ad, Karaj and the Bandar Abbas uranium mine and production plant at Gchine. F. Transparency Visits and Discussions 44. During the June 2004 meeting of the Board of Governors, the Director General asked Iran to provide the Agency, in the interest of transparency, access to the Lavisan-Shian site. The request was prompted by a reference made during that meeting to the Lavisan-Shian site in connection with alleged nuclear related activities (including the use of whole body counters) carried out at that site and the possibility of a concealment effort by Iran to hide these activities through the removal of all of the buildings from the site after November 2003.
__________________________________________________________________________________
5 Cobalt-60 and iridium-192 have half-lives of 5.2 years and 74 days, respectively.
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45. On 28 June 2004, the Agency visited the Lavisan-Shian site, where it took environmental samples. Iran gave the Agency a description and chronology of activities carried out at the Lavisan-Shian site. As described by Iran in a follow up letter to the Agency dated 8 August 2004, a Physics Research Centre had been established at that site in 1989, the purpose of which had been "preparedness to combat and neutralization of casualties due to nuclear attacks and accidents (nuclear defence) and also support and provide scientific advice and services to the Ministry of Defence." Iran provided a list of the eleven activities conducted at the Physics Research Centre, but, referring to security concerns, declined to provide a list of the equipment used at the centre. In a letter to the Agency dated 19 August 2004, Iran stated further that "no nuclear material declarable in accordance with the Agency's safeguard[s] was present" and reiterated its earlier statement that "no nuclear material and nuclear activities related to fuel cycle were carried out at Lavisan-Shian." 46. During its discussions with the Agency in June 2004, Iran confirmed its acquisition from a foreign entity of two whole body counters and their installation in two trailers. Iran further confirmed that one of these whole body counters, together with its trailer, had previously been located at the Lavisan-Shian site. Between 28 and 30 June 2004, Iran provided the Agency access to two whole body counters, and to a trailer said to have contained one of the whole body counters while it was located at Lavisan-Shian. The Agency collected environmental swipe samples from the whole body counters and the trailer. 47. According to Iran, the site had been razed in response to a decision ordering the return of the site to the Municipality of Tehran in connection with a dispute between the Municipality and the Ministry of Defence. Iran recently provided documentation in support of this explanation, which is currently being assessed. 48. The environmental swipe samples from the whole body counters and the trailer, along with the vegetation, soil and swipe samples collected from the Lavisan-Shian site, are currently being analysed, and the documents provided by Iran in support of these explanations are being assessed. 49. In accordance with Agency practice in connection with its evaluation of other States' nuclear programmes, the Agency has discussed with the Iranian authorities open source information relating to dual use equipment and materials which have applications in the conventional military area and in the civilian sphere as well as in the nuclear military area. G. Suspension of Enrichment Related and Reprocessing Activities G.1. Scope of suspension 50. As described in the previous Board report (GOV/2004/34, Annex, para. 51), Iran informed the Agency on 29 December 2003 that: * it would suspend the operation and/or testing of any centrifuges, either with or without nuclear material, at PFEP at Natanz; * it would suspend further introduction of nuclear material into any centrifuges; * it would suspend installation of new centrifuges at PFEP and installation of centrifuges at the Fuel Enrichment Plant (FEP) at Natanz; and
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* it would withdraw nuclear material from any centrifuge enrichment facility if and to the extent practicable. 51. Iran stated further that it did not currently have any type of gas centrifuge enrichment facility at any location in Iran other than the facility at Natanz that it was now constructing, nor did it have plans to construct, during the suspension period, new facilities capable of isotopic separation; it had dismantled its laser enrichment projects and removed all related equipment; and it was not constructing nor operating any plutonium separation facility. 52. Iran also stated on 29 December 2003 that, during the period of suspension, Iran did not intend to make new contracts for the manufacture of centrifuge machines and their components; the Agency could fully supervise storage of all centrifuge machines assembled during the suspension period; Iran did not intend to import centrifuge machines or their components, or feed material for enrichment processes, during the suspension period; and "[t]here is no production of feed material for enrichment processes in Iran." 53. On 24 February 2004, Iran informed the Agency that instructions would be issued by the first week of March to implement the further decisions voluntarily taken by Iran to: (i) suspend the assembly and testing of centrifuges, and (ii) suspend the domestic manufacture of centrifuge components, including those related to the existing contracts, to the furthest extent possible. Iran also informed the Agency that any components that were manufactured under existing contracts that could not be suspended would be stored and placed under Agency seal. Iran invited the Agency to verify these measures. Iran also confirmed that the suspension of enrichment activities applied to all facilities in Iran. 54. On 15 March 2004, Iran notified the Agency that the Agency's verification of the suspension of centrifuge component production could begin as of 10 April 2004. However, due to disputes between the AEOI and some of its private contractors, three private companies would continue with centrifuge component production. 55. Iran stated in a letter dated 18 May 2004, received by the Agency on 21 May 2004, that "Iran has not, at any time, made any undertaking not to produce feed material for the enrichment process. The decision taken for voluntary and temporary suspension is based on clearly defined scope which does not include suspension of production of UF6." 56. On 23 June 2004, the Director General received a letter from Iran informing him that Iran "plan[ned] to suspend implementation of the expanded voluntary measures conveyed in [its] Note dated 24 February 2004" and that Iran "thus, intend[ed] to resume, under IAEA supervision, manufacturing of centrifuge components and assembly and testing of centrifuges as of 29 June 2004." In the letter, Iran requested the Agency "to take steps that may be necessary to enable resumption of such operations as of 29 June." On 25 June 2004, the Director General wrote to Iran, referring to its letter of 23 June 2004, and expressed the hope that Iran would "continue to build international confidence through implementing its voluntary decisions to suspend all enrichment related and reprocessing activities" and informing Iran that the Agency would be in contact to clarify the practical implications of the decision of the Iranian authorities. Both letters were circulated to the Members of the Board of Governors for their information under cover of a Note dated 25 June 2004. 57. On 29 June 2004, the Agency received a letter forwarding a list of seals which, as foreseen in its letter of 23 June 2004, would be removed from material, components and equipment related to centrifuge component manufacturing and assembling. In a letter dated 29 June 2004, the Agency acknowledged receipt of Iran's letter and agreed to the removal of the seals by the operator in the absence of Agency inspectors.
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G.2. Monitoring activities 58. The status of the Agency's monitoring activities as of May 2004 was provided in the Director General's previous report to the Board of Governors (GOV/2004/34, Annex, paras 56-68). The Agency has continued its monthly monitoring activities at PFEP, most recently on 21-22 August 2004, to ensure that the suspension of enrichment activities at PFEP is fully implemented. The surveillance records from the cascade hall have been reviewed to ensure that no additional centrifuge machines were installed; the seals on equipment and nuclear material were verified to ensure that they had not been tampered with and replaced. The cascade hall continues to be under Agency surveillance and all the previously declared UF6 feed material remains under Agency seal. Other activities conducted by the Agency in connection with the monitoring of Iran's suspension undertakings have included: * design information verification at FEP; * monitoring of the decommissioned status of the AVLIS pilot plant at Lashkar Ab'ad through complementary access; and * inspections at JHL. 59. During the Agency's June 2004 visit to Esfahan, the operator of UCF stated that, of the 143 kg of UF4 produced and verified by the Agency previously, 60 kg had been fed into the UF6 process line. About 25 to 30 kg of UF6 produced from those activities was being kept in two condensers and another 5 kg of UF6 had been stored in a container. The operator told Agency inspectors that the equipment testing had been completed and that another larger test involving 37 tonnes of yellowcake is planned for August/September 2004. 60. Following on this, the seals that had been used by the Agency as one of the measures for monitoring Iran's suspension of the manufacture, assembly and testing of centrifuge components at Natanz, Pars Trash and Farayand Technique were removed by Iran and returned to the Agency during its visit to Iran between 6 and 18 July 2004. As of mid-August 2004, about 70 rotors had been newly assembled and tested, and were shown to the Agency. The Agency is discussing with Iran the necessary arrangements for the Agency to exercise "supervision". In that regard, the Agency has proposed that it seal the tested rotors, a measure which Iran has not to date accepted. It must be noted that, in the absence of such seals, the Agency's supervision of the activities identified by Iran cannot be considered effective.

Posted by maximpost at 11:32 PM EDT
Permalink
Thursday, 2 September 2004

>> SOUTH KOREA


U.S. Admonishes South Korea for Furtive Uranium-Enrichment Experiment, but Praises Disclosure
By Barry Schweid The Associated Press
Published: Sep 2, 2004
WASHINGTON (AP) - The State Department criticized South Korea on Thursday for conducting a secret uranium-enrichment experiment but praised its ally for working with a U.N. agency to make sure the program is ended.
The disclosure came amid a strenuous effort by the Bush administration to stop Iran from beginning a uranium-enrichment program U.S. officials say could produce four nuclear weapons.
Secretary of State Colin Powell said Wednesday the administration intends to press for a range of possible U.N. Security Council sanctions against Iran: political, economic or diplomatic.
South Korean scientists conducted the secret experiment four years ago, according to U.N. and South Korean officials.
South Korea is in the process of verifying to the International Atomic Energy Agency "that that activity has been eliminated and will not be repeated," State Department spokesman Richard Boucher said.
"But what they had done in the past was activity that should not have occurred," Boucher said. "It's activity that must be eliminated, and we are glad that South Korea is working in a transparent manner to do that."
The spokesman said the scale of South Korea's enrichment work was much smaller than that of North Korea and Iran. And he called on North Korea to disclose its activity to the U.N. agency.
Libya and South Africa have set a good example by abandoning nuclear weapons projects, Boucher said, and South Korea is following suit. "We hope that other nations would follow it, as well," he said.
Daryl G. Kimball, executive director of the Arms Control Association, a private research group, said "South Korea needs to make lemonade out of this lemon."
"They not only need to condemn the activity and end the program but they should fully prosecute responsible individuals," Kimball said in a telephone interview.
"This would set the proper example for other states of concern in the region and in the world," he said.
Noting that the source of South Korea's technology had not been disclosed, Kimball said "we cannot afford to have another whitewash."
"This incident should lead to a reevaluation of U.S. export control laws on nuclear technology," Kimball said. "It is possible that this project had links to U.S.-origin technology,"
Boucher said he did not think the South Korean experiment would affect negotiations with North Korea to end its weapons program and to denuclearize the Korean peninsula.
The six nations engaged in the talks - the United States, North Korea, South Korea, Japan, China and Russia - have agreed to resume negotiations at the end of the month but no date has been announced.
AP-ES-09-02-04 1610EDT




IAEA Probes S. Korean Nuclear Experiment

By SANG-HUN CHOE
Associated Press Writer
SEOUL, South Korea (AP) -- The U.N. nuclear watchdog is investigating a secret uranium-enrichment experiment that South Korean scientists conducted four years ago, U.N. and South Korean officials said Thursday.
The single experiment in early 2000 was revealed in a report South Korea presented last month to the Vienna, Austria-based International Atomic Energy Agency, the Science and Technology Ministry said in a statement.
South Korea reported that its "laboratory scale" experiment "involved the production of only milligram quantities of enriched uranium," the IAEA said in a statement posted on its Web site.
Highly enriched uranium can be used to make nuclear warheads. But South Korea said Thursday it has no intention of building nuclear bombs and remains committed to international efforts to persuade North Korea to abandon its weapons development.
There was no immediate reaction from communist North Korea, which says it is building a "nuclear deterrent" to counter what it calls plans by the United States and its South Korean ally to unleash a nuclear war on the divided Korean peninsula.
"The government will take measures to prevent similar things from happening in the future," the statement said, adding that a small group of scientists conducted the experiment on their own initiative.
An IAEA investigating team arrived Sunday in South Korea to conduct a weeklong probe into the program, the ministry said.
The team will report early next week to IAEA Director General Mohamed ElBaradei, who in turn will present his findings when the agency's Board of Governors convenes in mid-September.
South Korea said the uranium enrichment took place during experiments using laser technology to separate isotopes. Those experiments were part of the country's research for domestic production of fuel for its nuclear power plants.
The experiment, conducted in a facility dedicated to research into nuclear fuel, involved separating just 0.01 ounces of uranium, the statement said. The experiment was immediately terminated after it was conducted and the equipment scrapped, according to the ministry.
South Korea said the government only recently found out about the unauthorized experiment, when it prepared a report under the terms of a new, tougher safeguard agreement it signed with the IAEA in February that required it to record activities in the fuel research center.
"The fact that we have decided to report this faithfully and transparently to the IAEA reflects our commitment to nuclear nonproliferation," the ministry said. "We are sincerely honoring our obligations for the peaceful use of nuclear energy and nuclear nonproliferation."
South Korea said it remains committed to keeping the Korean peninsula free of nuclear weapons.
The revelation comes as South Korea and five other countries are trying to persuade North Korea to give up its nuclear ambitions. That crisis arose after the North reportedly admitted in 2002 having a secret nuclear program in violation of international agreements.
South Korea launched a secret nuclear weapons program in the 1970s under military dictator Park Chung-hee, but abandoned the plan after strong U.S. pressure.
Lacking oil and natural resources, South Korea's civilian nuclear program today provides more than 40 percent of the country's energy.
? 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.



IAEA Inspection Team Conducting Investigation in South Korea
2 September 2004 | On 23 August 2004, during discussions about the initial declarations of the Republic of Korea (ROK) under the Additional Protocol to its Safeguards Agreement, the ROK informed the IAEA that it had enriched nuclear material in the course of atomic vapour laser isotope separation (AVLIS) experiments that had not been declared to the IAEA. The ROK informed the IAEA that these experiments had been on a laboratory scale and involved the production of only milligram quantities of enriched uranium. According to the ROK, these activities were carried out without the Government?s knowledge at a nuclear site in Korea in 2000, and that the activities had been terminated.
Following receipt of this information, the IAEA dispatched a team of inspectors, headed by the Director of the Safeguards Operations Division responsible for the ROK, to investigate further all relevant aspects of this matter. The inspectors will report to the Director General upon their return to Vienna early next week. The Director General will be informing the Board of Governors of the IAEA?s initial findings at the next meeting of the Board of Governors beginning on 13 September 2004.
Press Contacts
Mark Gwozdecky
Director and Spokesperson
Division of Public Information
[43-1] 2600-21270
[43] 664-154-6989 (mobile)
m.gwozdecky@iaea.org
Melissa Fleming
Alternate Spokesperson
Div. of Public Information
[43-1] 2600-21275
[43] 664-325-7376 (mobile)
m.fleming@iaea.org

South Korea Admits Enriching Uranium to Near Bomb Grade
By REUTERS
Published: September 2, 2004
http://www.nytimes.com/reuters/international/international-nuclear-korea-iaea.html
Filed at 11:33 a.m. ET
SEOUL/VIENNA (Reuters) - South Korea has admitted that government scientists enriched uranium four years ago to a level that several Vienna diplomats said was almost pure enough for an atomic bomb, the U.N. nuclear watchdog said on Thursday.
Although only a minute quantity of uranium was involved, two Western diplomats close to the International Atomic Energy Agency (IAEA) said the enrichment was below but ``very close'' to the threshold for bomb-grade uranium.
``It was well beyond the level that would be needed for a civilian program,'' one of the diplomats told Reuters. ``The government says that its program is peaceful and the IAEA is not making any judgments on that issue.''
South Korea said in a statement the U.N. nuclear watchdog was investigating the disclosure. It said the experiments, which involved enriching uranium with lasers, were carried out by a group of scientists without government knowledge and soon ended.
``This is enrichment of uranium,'' a government official told Reuters by telephone. Other government officials had earlier said the experiments did not go as far as enriching uranium.
The IAEA said in a statement that Seoul had told the agency that ``these activities were carried out without the government's knowledge at a nuclear site in Korea in 2000.''
At the same time, a Vienna diplomat said the scientists were government employees working at a government-run facility.
South Korea has signed the nuclear Non-Proliferation Treaty (NPT) and the IAEA's Additional Protocol, which gives inspectors the right to conduct more intrusive, short-notice visits to nuclear sites than normal NPT safeguards permit.
``With the Additional Protocol in force, it would have been difficult for Korea to keep this a secret,'' the diplomat said.
The IAEA said a team of inspectors was now in South Korea and would be returning to Vienna early next week. The agency's chief, Mohamed ElBaradei, would present the inspectors' findings to the IAEA Board of Governors when it meets on Sept. 13.
CLEAR VIOLATION OF THE NPT, DIPLOMATS
The experiments clearly did not constitute a violation of the NPT because they were not an attempt to build nuclear weapons, the South Korean official said.
However, several diplomats on the IAEA's 35-member Board of Governors said that South Korea had clearly violated its obligations under the NPT, which requires that such activities be reported to the IAEA. They said the board had no choice but to report such violations to the U.N. Security Council.
``This will have to be reported to the Security Council, but the board would want that to be with the consent of the South Korean government, similar to what we did with Libya,'' one Western diplomat said on condition of anonymity.
Earlier this year the IAEA board reported Libya to the Security Council, which has the power to impose sanctions, though the report was purely informative and praised Tripoli for coming clean about its past secret atomic weapons program.
Another Western diplomat close to the IAEA said that the agency would naturally want to fulfill its duty as the watchdog of the NPT by conducting a thorough investigation to rule out the possibility that South Korea has a secret weapons program.
The revelation could prove embarrassing to Seoul, which is a key member of six-party talks aimed at ending North Korea's nuclear ambitions.
U.S. officials said in October 2002 that the North had admitted to running a secret nuclear program based on uranium enrichment technology.
Pyongyang has since denied the claim. It has yet to comment on the latest South Korean disclosure.
South Korea began a secret atomic weapons program in the 1970s under Park Chung-hee, a military dictator who was assassinated in 1979. Park's program is widely believed to have only ended with his death.
The IAEA has made similar discoveries of minute amounts of enriched uranium and weapons-grade plutonium in Iran, which Washington considers as evidence that Tehran is using its civilian nuclear energy program as a front for developing atomic weapons.
Iran says the United States is wrong and insists its nuclear ambitions are limited to the peaceful generation of electricity.
The South Korean government learned of the enrichment experiments while drawing up its first report to the IAEA, submitted this month, the Seoul statement said.
The experiments were conducted in January and February 2000 as part of research in producing nuclear fuel in the country, it said. A minute quantity, 0.2 gram, of uranium was successfully enriched. All facilities and the uranium were destroyed immediately after the experiments, the statement added.


>> BBC SPIN
S Korea in 'secret' nuclear trial

By Charles Scanlon
BBC correspondent in Seoul
The South Korean Government has admitted its scientists experimented secretly with nuclear fuel enrichment.
Experts say the technique used could have military implications, but a government official denied any intention to build a weapons programme.
A European based diplomat said the work was a violation of South Korea's international nuclear commitments.
The discovery could lead to calls for South Korea to be referred to the UN Security Council, like North Korea.
It is also likely to cause severe embarrassment to Seoul, and its key ally the US.
A team of inspectors from the IAEA secretly rushed to South Korea last week, after the government revealed that the country had broken its commitments on nuclear proliferation.
According to the ROK (South Korea), these activities were carried out without the government?s knowledge at a nuclear site in Korea in 2000
IAEA statement
Seoul made the admission under the terms of a tougher inspection regime that is just coming into effect.
A South Korean government official told the BBC that the research, which involved the use of lasers to enrich nuclear fuel, was not authorised by the government.
The official said it was a "rogue" operation which ended four years ago, and concerned the production of a tiny amount of highly enriched uranium, which could be used for an atomic bomb.
The official said the research was for the domestic production of nuclear fuel for the country's civil programme.
However, according to analysts, there is no credible civilian use for the technique, which uses lasers to create weapons-grade uranium.
'Same as Iran'
South Korean officials said the government only found out about the experiments in the last few months, and were now investigating the scientists responsible.
A European-based diplomat said their actions were a clear violation of the nuclear non-proliferation treaty, and could put South Korea into the same category as Iran.
South Korea abandoned a nuclear weapons programme in the 1970s, under intense pressure from the United States.
It has since committed itself to a nuclear-free Korean peninsula, and has been at the forefront of efforts to persuade North Korea to give up its development of atomic bombs.
The finding is likely to cause deep embarrassment to the US, which regards Seoul as a close ally in its attempts to persuade the North to abandon its nuclear ambitions.
According to IAEA spokesman Mark Gwozdecky, the inspectors will leave South Korea early next week, and their findings will be presented to the agency's Board of Governors on 13 September.






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

>> NORTH KOREA

U.S. Moves for Arms Buildup Assailed
Pyongyang, September 1 (KCNA) -- The United States decided to deploy a squadron of Alaska-based F-15E in south Korea under the pretext of staging an exercise aimed to familiarize themselves with terrain conditions in case of contingency on the Korean peninsula. Minju Joson Wednesday in a signed commentary carried in this regard says:
This is an open challenge to the Korean people and the rest of the world people desirous of peace and reunification of Korea.
The U.S. plan to bring the squadron into south Korea at a time when Ulji Focus Lens-04 is at its height there goes to prove that the U.S. moves for a war of aggression against the DPRK have reached a reckless and adventurous phase.
The U.S. moves for a new war should not be overlooked. It is self-evident that should the U.S. ignite a war on the Korean peninsula against the DPRK, it will lead to a nuclear war and then the Koreans in the north and the south will suffer from it.
It is a sheer delusion of the U.S. to try to stifle the DPRK by force of arms. The U.S. would be well advised to properly understand who its rival is and stop such arms buildup and withdraw all its forces of aggression from south Korea.
The south Korean authorities should ponder over the consequences to be entailed by their traitorous act of bringing foreign aggressors with nuclear clubs into south Korea.



Talking Human Rights With North Korea
By Roberta Cohen
Monday, August 30, 2004; Page A23
Whatever would Ronald Reagan think of the six-party talks to get North Korea to dismantle its nuclear weapons program? Although Kim Jong Il's Communist government is the world's worst human rights violator, the United States, Japan and South Korea have managed to exclude all reference to humanitarian and human rights concerns from the discussions. Their fear is that any mention of the 200,000 political prisoners in forced labor camps, the suppression of the population's civil and political freedoms or the punishment meted out to those who try to flee the country would antagonize the North Korean government and jeopardize chances for a nuclear agreement.
This is hard to understand, given that when confronted by the Soviet Union, which had far greater nuclear power and targeted it specifically against the United States, Reagan did not see fit to give up on human rights goals. In fact, he publicly affirmed in 1982 that "the persecution of people" must be "on the negotiating table or the United States does not belong at that table." Similarly, President Jimmy Carter before him negotiated the SALT II arms control agreement with the Soviets while calling attention to human rights concerns.
Reagan and Carter were able to make this link because of the 1975 Helsinki Final Act, an East-West agreement that created a multilateral forum for discussing security concerns, economic and scientific issues, and human rights. Moscow signed on for security guarantees -- the acknowledgment of post-World War II borders -- while the West secured a commitment to advance human rights. In fact, one of the lessons of this period was that only in that broad context of strategic, political and economic issues could progress be made on human rights.
Once they resume, the talks with North Korea, which involve the United States, South Korea, Japan, Russia and China, could create a multilateral forum for the Korean Peninsula along the lines of the Helsinki process. The talks already cover nuclear and security issues, and more recently economic questions were added. Human rights and humanitarian issues should be brought in as well. For one thing, foreign investment in a country with forced labor must be linked to human rights standards. Any increase in food aid should go hand in hand with humanitarian principles of unimpeded access and equitable distribution. Nuclear verification and inspections would benefit as well from these openings.
South Korea's support should be sought as a first step toward creating a Helsinki framework. Since 1994 South Korea has gained experience of the Helsinki process through its partnership with the Organization for Security and Cooperation in Europe, the successor to Helsinki. On the European continent, South Korea promotes democracy and human rights and sends election monitors to the Balkans. But on the Korean Peninsula it looks the other way, fearing that any mention of human rights in the North would trigger turmoil, collapse and an outpouring of refugees.
Yet, since 2001, North Korea has been involved, albeit modestly, in "human rights dialogues" with the European Union and the ambassadors from Germany, Sweden and the United Kingdom. In a note to the United Nations, the North Koreans claim to have allowed the European Union "access to reform-through-labor centers and contact with former inmates."
Using those talks as a springboard, Europe's Helsinki organization could offer to bring North Korea into observer status. This would expose the country to multilateral discussions about democracy, freedom of movement, family reunification and the safeguarding of civil and political freedoms. Within this broader political and security framework, North Korea might be more willing to face up to its international human rights obligations.
China will need to be brought into the process as well. It hosts the six-party talks and is North Korea's primary ally. Between 200,000 and 300,000 North Koreans have fled to China because of famine, lack of work and persecution. There they face the threat of arrest and deportation. Yet promoting fairer food distribution in North Korea and improved human rights conditions would help curb refugee flows into China. A regional forum could also explore burden-sharing with countries willing to resettle North Koreans, such as Russia, where a provincial government has said it would take 200,000, and the United States, where Congress has expressed readiness to accept North Korean refugees.
Finally, a multilateral framework would help reconcile the differences between humanitarian and human rights advocates over how to deal with North Korea. Relief workers delivering food aid to North Korea fear that any overt criticism of the North's human rights record would limit humanitarian access. But mounting concerns over the diversion of international food aid to the army and communist elite -- rather than to the 6.5 million Koreans reported at risk -- have led to the withdrawal of leading nongovernmental organizations and a reduction in donations from governments. A Helsinki process would make food distribution part of the discussion along with human rights issues. As matters stand, a sense of direction is lacking for dealing with the serious human rights and humanitarian problems on the Korean Peninsula. The Helsinki process provided that essential element for the Soviet Union and Eastern Europe in the 1970s and 1980s. Adapted to Asia, it could do the same for North Korea.
The writer is a senior fellow at the Brookings Institution specializing in humanitarian issues. She will answer questions at 2 p.m. on Thursday at www.washingtonpost.com.
? 2004 The Washington Post Company



>> EXCLUSIVE INTERVIEW

Four Decades in North Korea
One cold night in 1965, Sgt. Charles Robert Jenkins disappeared from a patrol in South Korea. Forty years later he has resurfaced. In his first interview since leaving North Korea, he tells the Review his story
By Jeremy Kirk/TOKYO
WEB SPECIAL/September 01, 2004
After surviving for nearly four decades in North Korea and spending a month in a Tokyo hospital room, United States Army Sgt. Charles Robert Jenkins wants closure. And to get it, he's ready to tell his story.
In Jenkins' first interview since taking flight from the North Korean regime in July, the alleged defector tells the REVIEW why he intends to turn himself over to the U.S. Army even though he expects to face a court martial. Jenkins reveals how he sought asylum at the Soviet embassy in 1966, endured repeated beatings at the hands of another American defector, and was pressured by North Korean authorities to reject a personal invitation by the Japanese prime minister to leave the country with him. And he describes how his difficult life in North Korea was lifted from misery by a love affair with a Japanese nurse who shared his hatred of the communist regime and eventually helped him and their two daughters escape.
"When I got on the airplane in Indonesia coming to Japan," Jenkins says, speaking in a colloquial English that reflects his seventh-grade North Carolina education and decades spent in a foreign land, "my intentions was to turn myself in to the military for the simple reason I would like to put my daughters with their mother, one thing. Another thing: I'd like to clear my conscience."
Rising from his hospital bed at the Tokyo Women's Medical University, Jenkins greets his visitor with a deferential Korea handshake, briefly makes eye contact and immediately looks away. A graying 64-year-old with a heavily creased face, Jenkins is still restricted in what he says: under the advice of his military lawyer he withholds the circumstances of his alleged desertion to North Korea and many of the details of his life there-information that he intends to offer to the Americans in return for their leniency.
On September 1, Jenkins announced to the press that he would report to U.S. Army Camp Zama, near Tokyo, and "voluntarily face voluntarily the charges that have been filed against me by the U.S. Army." The U.S. charges Jenkins with desertion, aiding the enemy, soliciting others to desert and encouraging disloyalty. In a document seen by the REVIEW that was intially intended to argue his case for an other-than-honourable discharge, Jenkins acknowledges that he is guilty of at least one of the four charges against him or of a lesser included offense, without specifying precisely which offense. The U.S. military informally rejected Jenkins' discharge request. (For more on Jenkins' legal case, see article on page 18).
The U.S., not wishing to send the wrong message to its troops in Iraq and Afghanistan, has publicly vowed to prosecute Jenkins. But privately the matter is much more delicate. Jenkins presents a starkly different picture than of a deserter who enjoyed living in North Korea and supported the regime by acting in propaganda movies. It's of a man-and family-who scraped by while North Korean officials watched their every move.
As he talks, Jenkins stares at the floor, absorbed in his solemn past. Frequently on the verge of tears, his voice cracks and wavers when he speaks of his wife and children. A three-pack a day smoker who suffers heart problems and anxiety attacks, Jenkins speaks slowly, in a hoarse North Carolina drawl, deliberately choosing each word as he lucidly recalls dates and events from decades ago.
Jenkins arrived in North Korea already a service veteran. He dropped out of school in North Carolina in the seventh grade, not long after the death of his father, and in 1955, at 15, he entered the National Guard. After an honourable discharge in April 1958, he enlisted in the regular Army. By August 1960 he had begun a 13-month tour in South Korea, during which he was promoted to sergeant; he was returned for a second tour in September, 1964. Then, on a bone-chilling night early the following January, on patrol along the Demilitarized Zone, the 24-year-old sergeant with an unblemished nine-year service record vanished. The U.S. government considers him a deserter, saying that he left behind letters stating his intention to defect; members of his family in the U.S. have said they are convinced that he was captured by the communist state.
From 1965 to 1972, on the other side of the DMZ, Jenkins shared a harsh life with three other alleged U.S. Army defectors: Pfc. James Joseph Dresnok, Pvt. Larry Allen Abshier and Cpl. Jerry Wayne Parrish. "At first the four of us lived in one house, one room, very small, no beds-we had to sleep on the floor," Jenkins says. "There was no running water. We had to carry water approximately 200 metres up the hill. And the water was river water."
The North Koreans played the Americans against each other, Jenkins says. "If I didn't listen to the North Korean government, they would tie me up, call Dresnok in to beat me. Dresnok really enjoyed it."
The diminutive Jenkins, about 1.65 metres tall, describes Dresnok as "a beater, 196 cm tall, weighed 128 kilograms. He's big. He likes to beat someone. And because I was a sergeant he took it out on me. I had no other trouble with no one as far as Abshier and Parrish, but Dresnok, yes."
Abshier died of a heart attack in 1983 and Parrish died of a massive internal infection in 1997, according to Jenkins' discharge request. Dresnok is still living in North Korea.
An August 25 psychiatric report by Tokyo doctors, seen by the REVIEW, says Jenkins suffers from a panic disorder as a result of his treatment. "He had been suspected for espionage and continuously censored. During the first several years, he was forced to live together with three American refugees so as to mutually criticize their capitalistic ideology with physical punishment such as beating on face," the report says.
Jenkins would have had particular trouble erasing his past: He bears a tattoo of crossed rifles-the branch insignia of the infantry-on his left forearm. When he got the tattoo as a teenager in the National Guard, the letters "U.S." were inscribed underneath; the North Koreans cut the letters away.
According to Jenkins' discharge request, which was written on his behalf by his military attorney, Capt. James D. Culp, Jenkins and the three other men tried to escape. "In 1966, Sgt. Jenkins even risked his life to leave North Korea by going to the Russian embassy and requesting asylum. Obviously, the Russian government denied the request."
During the 1960s, according to another revealing passage in the discharge request, Culp writes that contrary to rumours, "Sgt. Jenkins had no interaction of any kind with any American sailor taken captive during the USS Pueblo incident." The January 1968 incident began when the North Koreans seized a U.S. Navy spy ship off the country's coast near Wonsan. One crew member was killed, while 82 others were beaten and threatened with death before being released 11 months later, after an embarrassing apology by the U.S..
Meanwhile, between 1965 and 1980, Jenkins says he was beaten by Dresnok at least 30 times. Then, in 1980, Jenkins met Hitomi Soga, and his life changed. "Approximately 10 o'clock at night she came to my house," he says in the interview. "At that time she was 21 years old. I was 40 years old. Anyway she came to my house, the Korean government told me for me to teach her English so they told me to take a few days rest so that we could get very well acquainted, so after about 15 days I started teaching her English."
Soga had been abducted in 1978 by North Korean agents in Japan, and brought to North Korea. "They wanted a schoolteacher to teach the Korean children Japanese language, Japanese customs in order to turn them into espionage agents," says Jenkins. But the kidnappers made a mistake, he says. "The North Korean government did not have any use for my wife because she was not a school teacher, she was a nurse. Therefore they had nowhere really to put her, so if she's with me they'd know where she's at."
When Soga told Jenkins one week after they met that she had been kidnapped, Jenkins says he couldn't believe it. "I'd been in North Korea at that time approximately 15 years and I never heard of anyone being kidnapped. I never heard anything about any civilian being taken to North Korea by force. I learned that my wife-she didn't like the Koreans for it. I also learned that when my wife was taken, the same night her mother disappeared. Her mother never been heard from again. I felt very, very sorry for her. And she learned that I had been in North Korea for 15 years. She knew that I also did not want to be in North Korea so me and her became much closer than before. So it wasn't long after that I asked her to marry me. She said she must think about it a little bit. Her and I got much, much closer and in the end she said she would marry me. So I notified the Korean government, and they agreed. They didn't care."
Jenkins says "there was no one in the village I lived in that thought that she would ever marry me" because of their age difference. "But after meeting her 38 days later we were married. My wife and I became very close as far as love because she hated the (North) Korean government as well as I, so her and I joined hands in marriage on August 8, 1980. From that time on we lived very, very happy."
The couple's first daughter was born three years later. "I named her Roberta because my name is Robert. My wife I told her to give her a second name. She gave her the name Mika and of course my name is Jenkins. Mika means in Japanese `beautiful.'"
Their second daughter was born in 1985: "We named her Brinda Carol Jenkins. That's B-R-I-N-D-A. The reason, my half sister in America was named Brinda Carol."
While Jenkins was building a family, to the outside world his existence and that of other Americans in North Korea was slipping into legend. Jenkins appeared in a North Korean anti-U.S. propaganda film in the 1980s, but by the 1990s the notion that there were still Americans living in Pyongyang was mostly a rumour. It was not until Jenkins resurfaced in 2002 with his teenage daughters that his presence was confirmed.
That year, in a summit with Japanese Prime Minister Junichiro Koizumi, North Korean Leader Kim Jong Il agreed to allow a number of Japanese who had been abducted by North Korea to return home. The issue of abductees had long been an emotional issue for the Japanese public and a major sticking point in relations between the two countries.
Jenkins' wife Hitomi went back to Japan that October, leaving her husband and their two daughters behind and bringing international attention to the family. Soga soon became a national hero in Japan, trailed by the media. And Jenkins showed his face as well, giving a rare interview to a Japanese magazine in North Korea. He was quoted as saying that he had not known until that year that Soga was an abductee; he was also quoted as praising Kim Jong Il.
Now that he's left the country, Jenkins no longer disguises his bitterness at the North Korean regime. His legal defence is based in part on the notion that he learned to feign fealty to a regime he despised to avoid death and keep his family together.
Following Soga's release, the North Korean government sought to convince her to return to her husband and daughters, while others tried to find a way to reunite the family in another country. In May 2004, Japanese Prime Minister Junichiro Koizumi traveled to North Korea a second time. On this visit he won the release of the children of Japanese abductees, and tried personally to persuade Jenkins to come to Japan.
Jenkins says he was told he had 10 minutes with Koizumi, but the meeting lasted nearly an hour. "At that time, my wife had been in Japan for 21 months," he says. "Prime Minister Koizumi had a document signed by Kim Jong Il. He got it that morning." The document said that Jenkins and his daughters could leave with Koizumi.
"But before Prime Minster Koizumi came that day," says Jenkins, "four people came and talked with me what would happen to me if I left North Korea. One was the vice-minister for foreign affairs. The other three I don't know exactly who they were. They come and give me a lecture on not to go to Japan. And I knew if I left that day I would never get to the airport."
Jenkins says he also knew the room he was in with Koizumi and his delegation was bugged. "So I told Prime Minister Koizumi I could not leave North Korea," Jenkins says. "He said, `North Korea will not let [Hitomi] leave if she comes back and she does not wish to come back to North Korea.' He said `Today I would like to take you and your daughters with me to Japan.'"
Jenkins suggests that he feared what would happen if he accepted the invitation. "I knew that if I left the guest house that we met Prime Minister Koizumi in, instead of going right to the airport they'd had went to the left and I would have went right back to the area I lived in before and it may have been the end of my life," Jenkins says, his voice cracking.
Jenkins says he was told later that day that Kim Jong Il was very pleased that he did not go to Japan with his daughters. The North Koreans then told Jenkins they would allow him to travel to a third country to meet his wife and bring her back to North Korea.
"North Korea said, `let's go to China.' I agreed," says Jenkins. "But my wife would not. She said no." Soga, determined not to return, feared that China was too close to North Korea. Instead, a meeting was arranged for July in Jakarta.
"The reason I agreed to go to Indonesia because at one time it was a socialist country for one year-that was under Sukarno," says Jenkins. "The purpose of going to Indonesia was to bring my wife back to North Korea. And they (North Korean officials) thought if I went with my two daughters, that she would follow me. But she would not do so and I had no intentions of going back to North Korea."
That leaves Jenkins to face his next challenge: a possible court martial. His military lawyer, Capt. Culp, says Jenkins can offer the U.S. details about the use of foreign nationals in the North Korean spy programme. The request for a discharge asserts that Jenkins can confirm that "a number of Americans were used, most often unwillingly, by North Korea to arm spies with English-speaking skills so they could target American interests in South Korea and beyond."
Culp writes, "The value of this intelligence about the lives and fates of the fellow Americans who lived for decades in North Korea is immeasurable."
The document suggests that Jenkins can help American intelligence identify possible North Korean spies: "At least three other Americans who are suspected of deserting to North Korea were allowed to marry East European and/or Middle Eastern women who had been brought to and held in North Korea against their will. In two of the cases, the Americans had multiple children who are now young adults who appear to be American or European themselves." Jenkins possesses what he says is an April 2004 photograph, seen by the REVIEW, of an ageing Pfc. Dresnok with 19-year-old Brinda and five other non-Korean looking people.
Jenkins has been at the Tokyo hospital since arriving in Japan. In addition to his chronic health problems, he is recovering from prostate surgery in April in North Korea that left him with an infected post-operative wound. Koizumi, a supporter of Washington in the war in Iraq, has raised Jenkins' case with President George W. Bush, but U.S. officials insist that the two governments have not negotiated over the outcome of the ongoing legal process. Jenkins expresses appreciation to the Japanese government, who made his wife's freedom possible, and eventually took in him and his daughters. "It was not my intention whatsoever for the Japanese government to try to get me out of trouble," Jenkins says. "And I really appreciate the Japanese government for all they have done for me."
What he wants now is an end to a nearly four-decade Odyssey, as he prepares to turn himself over to the Americans. He has no interest in getting a civilian attorney. "The American Army has supplied, assigned a very capable man to me, to help me, bring me to military justice. I don't think I need no civilians. All I want to do is clear myself with the American Army."
For more articles from past issues of Far Eastern Economic Review going back to 1946, search feer.com's archive.


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China's 'S&M' journal goes too far on Korea
By John J Tkacik, Jr
WASHINGTON - China hands in Washington have been abuzz in the past week with rumors that Beijing was preparing a policy shift on North Korea. But American, Korean and Japanese policymakers shouldn't think China is on the verge of altering its unbending support for North Korea simply because recently a well-meaning Chinese economist, Wang Zhongwen, managed to publish a thoughtful piece on Beijing's misguided North Korea policies. Alas, it was not to be, although teasing the truth from the hype takes a little work.
Last week, several Korean and Japanese newspapers pointed to Wang's article entitled "A New Viewpoint to Examine the North Korea Issue and the Northeast Asian Situation" that appeared in the most recent issue, No 4 (July/August 2004), of Strategy and Management Magazine, a Chinese bimonthly diplomatic magazine. [1] "S&M" (as it is affectionately known to Washington's China experts), is considered to be an authoritative periodical that is more provocative than mainstream media, occasionally publishing articles that question government policy. It is seen as a sounding board for controversial policy prescriptions - provided that the policy hasn't already been laid down. Wang's article apparently appeared on the S&M website the week before August 20 and was translated by the US Government's Foreign Broadcast Information Service (FBIS) on August 25.
Over the top
But it was clear at first glance that Wang's views were way over the top even for those of us who truly appreciate S&M. I know, because I found myself agreeing with them - a first for me. Wang persuasively argued that the wisest thing Washington could have done in response to North Korea's nuclear weapons was - nothing.
It was entirely possible for the US to take no notice of North Korea's willful development of nuclear weapons and turn a blind eye to it, he reasoned. All the US need do was have neighboring countries or interest-related countries attach importance to it and become anxious. "What was the urgency for the United States?" he asked, "Would this not be a better strategy? And in any case, North Korean nuclear weapons cannot hit the US homeland for the time being." He suggested that, if left alone, nature would have taken its course and the Chinese government would eventually have had to confront Pyongyang and force it to abandon its weapons, if only to ensure China's own security. In fact, Wang wrote, South Korea, Japan and China are the interest-related countries that will be most affected by the North's development of nuclear weapons, not the United States, and therefore China should adhere to its diplomatic idea of non-nuclearization of the Korean Peninsula and support the United States and the international community in peacefully resolving the North Korea nuclear issue.
Wang suggested that in the end a nuclear North Korea would have sparked demands in Japan for nuclear arms (and, I believe, in Taiwan as well), and Beijing would have been forced to take action - even without US begging. I would agree. I have argued that the mere fact that the US opposes North Korea's nuclear ambitions is the biggest factor in China's support for North Korea. After all, it has been one year since China launched the feckless six-party talks in Beijing and announced that "the American policy towards the DPRK [Democratic People's Republic of Korea, North Korea] - is the main problem we are facing", and since then, there has been precisely zero progress.
Moreover, Wang asserted as fact that "in October 2002, when holding talks with visiting US Assistant Secretary of State James Kelly, the DPRK explicitly admitted that it was reviving its nuclear program". This was bold! I am certain that Wang knows the official Chinese position is that Kelly "misunderstood" what the North Koreans had told him. The Chinese foreign ministry maintains public agnosticism, simply noting that "we have no knowledge of DPRK's nuclear program or its capabilities. We do not know if DPRK has a HEU [highly enriched uranium] program. According to our understanding, the Japanese are not completely aware of the situation, either." But according to The Washington Post, Chinese diplomats have said, "China did not believe North Korea had a highly enriched uranium program." [5] Despite information from Pakistan's government that Pakistani nuclear czar Dr A Q Khan provided North Korea with a "complete package", from raw uranium hexafluoride to the centrifuges to enrich it into weapons-grade fissile cores, China dismisses US concerns. By not facing up to Pyongyang's threat, Wang's article implies, Chinese diplomats are being too coy by half.
Damnation of Kim, praise for Bush
Wang's article goes on to blame the entire crisis on North Korea's leader, Kim Jong-il. Wang accuses Kim of the unpardonable sin of "practicing ultra-leftist politics and political persecution in order to maintain dynastic rule". He compounds this lese majeste with the accusation that Kim will "unilaterally develop nuclear weapons heedless of whether [his] people live or die, instead of making efforts to develop the economy and improve the people's living standards." The North Korean leader's move, said Wang, "can only land the DPRK in still more difficulties and in greater isolation", and "China has already done a great deal of work ... to make the DPRK understand this point."
And in case anyone thinks Chinese scholars do not have access to the speeches of American presidents, Wang observed that "the best note on this content was President George W Bush's words when standing at the 38th Parallel in February 2002: 'No state should become a prison for its people', and 'Korean children should not go hungry when a powerful army has food'."
Bravo! Mr Wang, I thought to myself, although I had the uneasy feeling that something was amiss. Wang's article was simply too good to be true.
Recalled and Banned
And indeed it wasn't true, or it didn't last - at least not for long. For, you see, the entire Issue Four of S&M has been removed from its website [3] and, according to an email posting from one subscriber on August 27, [4] "Today, the post office contacted me to say that Issue Four was mispublished, and that it must be recalled [shouhui], otherwise they won't give me the next two issues this year ... but the post office worker was not clear about the precise details. Please, which senior person knows the reason for this?" A few minutes later, another web logger, or blogger, on the S&M website wrote, "In fact, it wasn't mispublished, I suspect that it carried an article that was too sensitive. It is not appropriate for the normal man in the street to know too much, I guess it was the North Korea article."
What could have precipitated the drastic measure of recalling a publication from subscribers' mailboxes? The previous day, a suspiciously well-written polemic blast at Wang's article was posted on the S&M website; it was entitled "Some of our Intellectual Elites Advocate Selling North Korea Down the River" [5]. It said the United States is China's traditional enemy, North Korea is China's friend, and anyone that suggests otherwise is "even more corrupt that the Qing government of over a century ago".
It is important on this first anniversary of the Beijing six-party talks aimed at defusing Pyongyang's nuclear program that US policymakers who have seen Wang's article not get their hopes up. Wang's piece was simply an abortive effort by moderates in China's foreign policy community to inject some realism into Beijing's support for Pyongyang - only to be slapped down firmly by the hardline Chinese Propaganda Ministry, which alone has authority to recall publications that already have been distributed. China's propaganda apparatus and national security agencies are firmly in the hands of China's military commander-in-chief Jiang Zemin and his "Shanghai Faction", and as long as they are in charge, voices of reason and moderation like Wang's will have no place in Beijing's national security policy debates.
Footnotes:
[1] Wang Zhongwen, Yi Xin Shijiao Shenshi Chaoxian Wenti Yu Dongbeiya Xingshi, "Examining the DPRK Issue and Northeast Asian Situation from a New Viewpoint", Beijing, Zhanlue Yu Guanli, [Strategy and Management], Issue Four, July-August, 2004, pp 92-94.
[2] Glenn Kessler, Chinese Not Convinced of North Korean Uranium Effort, The Washington Post, January 7, 2004; Page A16
[3] Strategy and Management Magazine
[4] Strategy and Management Magazine
[5] Strategy and Management Magazine
John J Tkacik Jr, is a research fellow in Asian Studies at the Heritage Foundation in Washington, DC. He is a retired officer in the US Foreign Service who served in Taipei, Beijing, Hong Kong and Guangzhou and was chief of the China Division in the State Department's Bureau of Intelligence and Research.
(Copyright 2004 Asia Times Online, Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)


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>> IRAN

The Iranian bomb
(Washington, D.C.): One could be forgiven, in light of recent headlines and press accounts, for wondering precisely who the enemy is in this war on terror. For some people, it clearly seems that the list should include - if not be headed by - a democratic ally that has been subjected, per capita, to considerably more sustained and deadly terrorist attacks than the United States: Israel.
This argument requires Israel to be seen not for what it is - namely, a longstanding U.S. partner in a strategically vital region of the world where few exist, one that shares America's values and is a bulwark against the rising tide of anti-Western Islamist extremism. Israel must, instead, be portrayed as perfidious, pursuing an international agenda divergent from (if not actually at odds with) that of the United States and a liability, rather than an asset.
Those who would portray Israel in such an unflattering light doubtless are gleeful over leaks claiming the Jewish State surreptitiously obtained state secrets from a U.S. government employee working for the Pentagon. At this writing, no evidence has been provided to support such charges. Nor has anyone been apprehended - although, for several days, the FBI has been described as poised to arrest someone employed by the Defense Department's policy organization. Only time will tell whether anyone actually is taken into custody, the type of charges and whether he is actually found guilty.
A Bonafide Enemy
In the meantime, these leaks have already served to divert attention from a nation that genuinely should head the list of America's foes: the terrorist-sponsoring, nuclear-arming and ballistic missile-wielding Islamist government of Iran. This effect has been all the more ironic insofar as, according to press accounts, the classified information the FBI thinks was improperly purveyed to Israel involved documents shedding light on America's evolving policy towards the Iranian mullahocracy.
Strategic analyst Steven Daskal recently offered a reminder of the peril posed by Iran: "While the Islamic Republic of Iran as a state is technically not at war with the U.S., Ayatollah Khomeini's fatwa calling for total war by all Shi'ites, regardless of citizenship, against the 'Great Satan America' remains in effect - it has never been rescinded, and in fact was expanded to include killing Americans as being a necessary part of a defensive jihad to make the world safe for Islam. Khomeini's pioneering pseudo-theology was later picked up by Sunni extremists, including Osama bin Laden."
In a thoughtful article in the August 23rd New York Post, Amir Taheri recounted how Khomeini and his successors have translated that fatwa into a twenty-five-year-long war against the United States - waged asymmetrically, both directly (for example, in attacks against U.S. embassies and personnel) and indirectly (through terrorist proxies like Hezbollah in Lebanon, Muqtada al-Sadr in Iraq and Shi'ite warlords in Afghanistan). Taheri correctly observes that "the Khomeinist revolution defines itself in opposition to a vision of the world that it regards as an American imposition....With or without nuclear weapons, the Islamic Republic, in its present shape, represents a clear and present threat to the kind of Middle East that President Bush says he wants to shape."
Will America Act?
Therefore, for the United States, stopping the Islamist government in Tehran before it obtains the means to carry out threats to attack Americans forces in Iraq and elsewhere should be an urgent priority. For Israel, however, denying the ruling Iranian mullahs nuclear arms is literally a matter of national life and death.
Israel's concern about the growing existential threat from Iran can only be heightened by overtures Senator John Kerry and his running mate have been making lately to Tehran. In remarks Monday [August 30], Vice Presidential candidate John Edwards said a Kerry administration would offer the Iranians a "great bargain": They could keep their nuclear energy program and obtain for it Western supplies of enriched uranium fuel, provided the regime in Tehran promised to foreswear nuclear weapons. According to Sen. Edwards, if Iran did not accept this "bargain," everyone - including our European allies - would recognize the true, military purpose of this program and would "stand with us" in levying on Iran what are described as "very heavy sanctions."
There is just one problem: Based on what is known about Iran's program and intentions - let alone its history of animus towards us - only the recklessly naive could still believe that such a deal is necessary to divine the mullahs' true purposes. While it may be inconvenient to say so, Iran is clearly putting into place a complete nuclear fuel cycle so as to obtain both weapons and power from its reactor and enrichment facilities. And a deal like that on offer from Messrs. Kerry and Edwards failed abysmally in North Korea.
The Bottom Line
If the United States is unwilling to take concrete steps to prevent the Iranian Bomb from coming to fruition, its Israeli ally will likely feel compelled to act unilaterally - just as it did with the 1981 raid that neutralized Saddam Hussein's nuclear infrastructure. At the time, the Reagan Administration joined the world in sharply protesting Israel's attack. A decade later, however, the value of the contribution thus made to American security was noted by then-Defense Secretary Dick Cheney, who said he thanked God every day during Operation Desert Storm that Israel had kept Iraq a nuclear-free zone. If such a counterproliferation strategy becomes necessary once again, it will be in all of our interests to have Israel succeed.
Center for Security Policy
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Iran arrests people for nuclear spying: report
www.chinaview.cn 2004-08-31 00:19:13
TEHRAN, Aug. 31 (Xinhuanet) -- Iran's Information Minister AliYunessi said Tuesday that several people had been arrested forspying on the country's nuclear program, the official IRNA newsagency reported.
"The information ministry has arrested several spies who weretransferring Iran's nuclear information out of the country,"Yunessi was quoted as saying.
But Yunessi did not reveal when the arrest took place, nor didhe identify the arrestees.
However, he stated that members of the opposition MujahedinKhalq Organization, which Iran dubs as Munafeqin (hypocrites), havepassed the bulk of secrets about Iran's nuclear program to thecountry's enemies.
"Munafeqin have had the leading role in passing informationabout Iran's nuclear facilities and have expressed their pride inspying against Iran," Yunessi said.
"In a news conference which they held once in US, they said theywere proud of passing this information to America and othercountries," he said.
"The information ministry's counter-spying department isequipped with the most advanced devices and acts with power andutmost fluency against infiltration of spy services," he added."We have already arrested tens of spies," he said.Iran has been consistently denying the US accusation that it issecretly developing atomic weapons, asserting that its nuclearresearch is fully peaceful and US accusation is politicallymotivated. Enditem


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>> PICTURE...
http://www.geostrategy-direct.com/geostrategy%2Ddirect/
An interior view of Iran's Bushehr nuclear power plant, southwest of the capital Tehran, Iran, in this undated photo released by Iran's Atomic Energy Organization on Aug. 22. AP Photo/Iran's Atomic Energy Organization



Iran arrests nuclear spies
31-08-2004, 12:23
Iran's Information (Intelligence) Minister Ali Younesi said Tuesday that several people had been arrested for spying on the country`s nuclear program.
"The Information Ministry has arrested several spies who were carrying Iran's nuclear information (out of the country)," he told reporters, according to IRNA. Younesi did not identify those arrested, but stated that members of the Mujahedin Khalq Organization (MKO) have passed the bulk of secrets about Iran's nuclear program to foreign countries. (albawaba.com)



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UN: Report Reignites Concern Over Iran's Nuclear Ambitions
By Antoine Blua
http://www.rferl.org/featuresarticle/2004/09/838dafd8-4106-4a44-842d-5115b58bfd60.html
Last year, France, Britain, and Germany won concessions from Iran, which agreed to suspend uranium-enrichment activities to defuse the crisis over its nuclear program. But Tehran reversed that position after the International Atomic Energy Agency (IAEA) in June issued a tough criticism of Iran for its lack of cooperation with IAEA inspectors. A new report issued yesterday by the UN nuclear watchdog confirms that Iran has slid away from its agreement with the European powers by resuming large-scale production of equipment to enrich uranium. RFE/RL asks an analyst about what Europe's next move might be.
Prague, 2 September 2004 (RFE/RL) -- The International Atomic Energy Agency (IAEA) issued a report yesterday saying Iran plans to resume large-scale production of material to enrich uranium, a process that can help the development of nuclear weapons.
U.S. Secretary of State Colin Powell was quick to react, saying Washington will try to persuade the UN agency to refer Iran to the UN Security Council to try to impose sanctions.
The question is now whether France, Britain, and Germany will adopt the U.S. stance or try to find middle ground.
Shahram Chubin is director of research at the Geneva Center for Security Policy. He said the dilemma facing the three European states is to come up with a policy that is effective without forcing a confrontation between Iran and the Security Council. "The Iranians have moved backwards," he said. "They're slicing away at that program [of suspending uranium enrichment]. They had discussions with the European countries in Paris in July, which are leading nowhere."
Chubin added: "[However] I think that the European countries, by and large, don't share the Americans' belief that Iran is determined to get nuclear weapons. They think there's still time, [and] that Iran hasn't made yet a definite decision. And therefore they're not convinced that the only way to deal with Iran is by confronting it."
Powell told reporters in Washington that the United States believes Iran is taking steps toward developing nuclear weapons and wants the Security Council to impose economic, political, or diplomatic sanctions as a result.
John Bolton, U.S. undersecretary of state for arms control and international security, expressed concern about a statement in the IAEA report that Iran plans to convert 37 tons of "yellowcake" uranium into uranium hexafluoride (UF6), which could be used to build nuclear weapons. Bolton said this is "further strong evidence of the compelling need" to take Iran's nuclear program to the UN Security Council.
However, the UN's nuclear watchdog agency said there is still no evidence that would confirm U.S. allegations that Iran is building a nuclear bomb.
Tehran claims its nuclear program is for peaceful purposes only. Iranian Foreign Ministry spokesman Hamid Reza Assefi said the IAEA report is evidence that Iran is cooperating in resolving questions about its nuclear program.
According to Chubin, European countries have not yet determined what might trigger them to take firm steps against Iran at the Security Council. "When you refer something to the Security Council, you have to be sure [the council] is unanimous and is going to take a strong position," he said. "And the strong position in the case of Iran would be naming Iran as a noncompliant state. And as I said, [the European countries are] not sure that's the case yet. The European countries haven't [clearly stated that they have] got a red line that says, 'If you cross that line, we are going to take the sternest measures possible at the Security Council.'"
Chubin notes that the "red line," for the European countries, is uranium enrichment. The Iranians, he said, are moving very slowly toward that line.
The IAEA's board of governors is due to open a meeting to discuss Iran on 13 September.

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U.S. Plans to Seek Sanctions Against Iran
By GEORGE GEDDA
Associated Press Writer
WASHINGTON (AP) -- Secretary of State Colin Powell says the United States plans to press for a range of possible U.N. Security Council sanctions against Iran in response to what he describes as a concerted effort by that country to develop nuclear weapons.
Powell told reporters Wednesday night the United States will urge the United Nations' nuclear watchdog group on Sept. 13 in Vienna to refer the Iranian case to the U.N. Security Council for action.
"We're looking at the range of possible actions of a political, economic, diplomatic nature," Powell said.
He commented while flying home from Panama after attending the inauguration of Panamanian President Martin Torrijos.
In Vienna, the U.N.'s International Atomic Energy Agency said earlier Wednesday that Iran plans to process tons of raw uranium and restart its centrifuges - two activities that could be used to make nuclear warheads.
U.S. diplomats at the meeting said the revelations provided further evidence that Iran's activities pose "a threat to international peace and security."
"Unless there are assurances that the international community can count on, I think it's appropriate that it (the Iran issue) be referred to the Security Council," Powell said.
He said it remains to be seen whether there is a consensus to do that now.
Diplomats said the IAEA report on Iran with the new disclosures was based on information provided by Iran's government. Iran insists its nuclear program is devoted to the peaceful generation of electricity.
Earlier Wednesday, Undersecretary of State John R. Bolton, the administration's point man on nuclear proliferation threats, said, "We view with great concern" revelations in the IAEA report that Iran is about to convert 37 tons of yellow cake uranium into uranium hexafluoride gas.
Uranium hexafluoride is spun in centrifuges to produce enriched uranium, which in turn can be used to generate power or make nuclear warheads, depending on the degree of enrichment.
The United States will continue to urge other members of the U.N. agency's board of governors "to join with us in this effort to deal with the Iranian threat to international peace and security," Bolton said.
Another senior Bush administration official, in an interview in which his identity was withheld, said Iran was positioning itself to produce 220 pounds of enriched uranium, enough for four nuclear weapons.
U.N. inspectors have been looking for evidence that Iran has a secret nuclear weapons program. Such a finding could be critical to the Bush administration's effort to gain support from the other 34 members of the agency to seek U.N. Security Council action.
Tom Casey, a State Department spokesman, said the report being circulated by the IAEA "continues to document the fact that through the past 18 years Iran has amassed a record of deception and denial about its nuclear activities."
Democratic presidential candidate John Kerry's campaign criticized the Bush administration for going to war against Iraq on what it called discredited grounds instead of acting sooner to marshal U.S. allies to prevent Iran from developing nuclear weapons.
The IAEA report shows "a leading state sponsor of terrorism is yet another step closer to nuclear weapons capability," said Susan Rice, Kerry's senior national security adviser. "Yet the Bush administration has stood on the sidelines while this nuclear program has advanced. ... It is past time for this administration to develop a tough and effective strategy for dealing with Iran."
? 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.



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>> SYRIA


U.S. Wants Syria to Withdraw From Lebanon
By EDITH M. LEDERER
Associated Press Writer
UNITED NATIONS (AP) -- The United States is calling for the immediate withdrawal of Syrian forces from Lebanon, according to a a draft resolution circulated in the U.N. Security Council late Tuesday.
The new measure also offers support for elections under the current Lebanese constitution, which would rule out a second term for pro-Syrian President Emile Lahoud.
The United States decided to press for a resolution - with the support of France, Lebanon's former colonial ruler - after what many saw as a Syrian-engineered move to change the constitution to extend Lahoud's term.
The resolution calls on the council "to consider additional measures," which are not specified, if the Syrians and Lebanese don't comply.
Lebanon accused the United States and France Tuesday of trying to "blackmail" it and Syria, and create trouble between Beirut and Damascus.
U.S. deputy ambassador Anne Patterson said the United States wants the Security Council to vote on the draft resolution "hopefully by Wednesday or Thursday." But the draft is almost certain to face opposition from Algeria, the only Arab nation on the council, and probably from Russia and China, which traditionally oppose council interference in a country's internal affairs.
In Washington, the Bush administration sharply criticized Syria for meddling in Lebanon's politics, and a senior U.S. diplomat was likely to go to Damascus for high-level talks.
But Lebanese Foreign Minister Jean Obeid said Lebanese-Syrian relations are a matter for both countries to decide. He said Lebanon "completely separates between dealing with our internal affairs and international attempts at blackmail with the aim of fomenting a dispute between us and our brothers (in Syria)."
Syria's involvement in Lebanon dates back to 1976, when it sent its troops to Lebanon to help quell a year-old civil war that raged on for another 14 years. The West tolerated its control and even credited Syria with securing stability.
But since the Sept. 11, 2001, terrorist attacks, Western nations have been calling for democracy to take hold in the Arab world as a way to fight extremism - and President Bush's administration has repeatedly accused Syria of sponsoring terrorism.
The draft resolution, obtained by The Associated Press, calls for "the strict respect of Lebanon's sovereignty, territorial integrity, unity and political independence."
It "demands that Syrian forces withdraw without delay from Lebanon" and declares the Security Council's "support for a free and fair electoral process in Lebanon's upcoming presidential election conducted according to Lebanese constitutional rules devised without foreign interference or influence."
The Lebanese Cabinet last week approved an amendment to the constitution to allow Lahoud to stay in power three more years.
Parliament, instead of voting for a new president for the next six years, will have to vote on an extension to Lahoud's term, which expires Nov. 24. Parliament Speaker Nabih Berri called late Tuesday for a meeting of the 128-member legislature on Friday to amend the constitution to extend Lahoud's term.
The draft resolution asks Secretary-General Kofi Annan to report on implementation within 30 days. It was not drafted under Chapter VII of the U.N. Charter, so military action would not be an option.
The Lebanese Foreign Ministry said in a letter to the Security Council that U.N. action would be "a dangerous precedent."
? 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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Syria asked to not interfere with election
By Heather J. Carlson
THE WASHINGTON TIMES
The United States and France are drafting a U.N. Security Council resolution calling on Syria to stay out of Lebanon's upcoming presidential election.
The move came after Syria pressured the Lebanese Cabinet last week to amend the constitution to permit pro-Syrian President Emile Lahoud to serve an additional three years.
The Cabinet agreed, and a final vote to change the constitution now heads to the parliament, which is dominated by pro-Syrian legislators.
Syria, which is on the U.S. list of state sponsors of terrorism, has dominated Lebanese affairs since its troops entered the neighboring country in 1976 to end a 14-year civil war.
"We feel that the Syrian pressure to modify the Lebanese Constitution to permit President Lahoud to remain in office an additional three years is an affront to Lebanon's sovereignty and political independence," State Department spokesman Richard Boucher said yesterday.
In Lebanon, parliament elects the president, and Mr. Lahoud's term is scheduled to end Nov. 24.
"It is our view, and I think the view of many in Lebanon, that it's about time, 15 years after the Taif Accords, to live up to the spirit of those accords and have all foreign forces removed from Lebanon," Mr. Boucher said Monday.
He was referring to a 1989 agreement signed in Taif, Saudi Arabia, that guaranteed Lebanon's sovereignty.
The proposed U.N. resolution would call for elections under the present constitution and also require Syria to withdraw from Lebanon its remaining 20,000 troops. In addition, it would call on all foreign nations to respect Lebanon's sovereignty.
A U.S. official at the United Nations said the United States is pushing for a vote on the resolution, even if it fails to achieve a consensus among Security Council members. Russia and China have voiced some concerns about the resolution, the official said.
The State Department also is considering sending Assistant U.S. Secretary of State William Burns to Damascus next week to speak directly with Syrian officials about U.S. concerns, Mr. Boucher said.
Even if the U.N. resolution passes, it will do little to change Syria's power-broker status in Lebanon, said Laura King-Irani, an anthropology professor at the University of Victoria in British Columbia, who has written extensively about Lebanon.
"Syria is a baby sitter for the Lebanese, so to get them to leave is not easy, because many Lebanese do not want them to leave," Mrs. King-Irani said.
Syria helped end Lebanon's civil war in 1990 and establish stability, she said. Since then, Syria has wielded strong political and economic influence over its neighbor.
For things to change, Mrs. King-Irani said, the Lebanese would have to be able to maintain order in their country on their own.
"It's not just the Syrians' fault that they're in Lebanon," she said. "It comes down to the Lebanese and their part in this."


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Syria mocks U.S. concern for Lebanon
~~article_author~~ Reuters
Thursday, September 02, 2004
DAMASCUS Syria's state media lashed out on Thursday at U.S. pressure for a United Nations resolution telling Damascus to stop interfering in Lebanon's presidential election.
"No one can believe that the United States can possibly be concerned about Lebanon or any other Arab country," an editorial in the official Tishreen newspaper said. "American policies confirm just the opposite and point out that the present U.S. administration relies on a clear method of antagonism to Arabs."
Despite strong opposition on the UN Security Council, Washington is pushing for a quick resolution that would counter a vote set for Friday in Lebanon's parliament on whether to keep President Emile Lahoud of Lebanon, who is an ally of Syria, in office for three more years.
Syria's official SANA news agency said on Wednesday that Foreign Minister Farouq al-Shara had agreed during telephone calls with his Lebanese counterpart and with the Arab League that such a U.S. move was unjustified.
Keeping Lahoud in office requires a constitutional change.
The proposed UN resolution calls for "strict respect of Lebanon's sovereignty" and the withdrawal of some 17,000 Syrian troops from Lebanon.
France and Germany support the resolution, but it has drawn objections from several council members who say that Washington is interfering in Lebanon's internal affairs.
They also say the action is applying a double standard by demanding a Syrian withdrawal from Lebanon while ignoring Israeli occupation of Palestinian land.
Copyright ? 2004 The International Herald Tribune | www.iht.com


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Background/Israel's war on Hamas takes a turn, toward Syria
By Bradley Burston, Haaretz Correspondent
In a conflict of blood and irony, it may come as no surprise that Israel's successes in curbing terror by killing or jailing its warlords may now spell even more difficult challenges for the military.
With the top leaders of Hamas in their graves and others on the run, Israel has begin to look north for the men now issuing marching orders to the powerful Islamic militant group.
Israeli officials signaled this week that senior Hamas officials based in Damascus issued the orders for twin suicide bombings that killed 16 Israelis and wounded nearly 100 in Be'er Sheva on Tuesday.
Israeli officials have said that "solid evidence" to that effect has been sent to Washington. Foreign Minister Silvan Shalom left for the Netherlands on Thursday to press the point with his counterparts in the European Union, which is poised to sign economic agreements with the Assad government in the near future.
The attack rocked Israel, not least because it broke a five-month lull in which Israel had foiled hundreds of planned attacks within the state.
In fact, the very success of the Israeli campaign to, in the Pentagon's phrase, decapitate militant organizations may take the next phases of the anti-terrorism campaign in uncharted - and even more dangerous - waters.
"The weakening of the terror organizations in the West Bank and Gaza Strip have created a leadership vacuum external bodies are trying to fill. The most obvious are Hezbollah in Lebanon and Hamas headquarters in Damascus - both of them egged on by Syria," says Haaretz militarey commentator Amos Harel.
According to Harel, intelligence sources told Ya'alon this week that Hezbollah currently funds and directs fully 75 percent of the planned terror attacks mounted from the West Bank.
By contrast, in Hebron, a traditional stronghold of Hamas and the launch point for the Be'er Sheva attack, the fundamentalist organization is in direct contact with the Hamas command in Damascus.
"The assessment in the Central Command is that the struggle against terror has changed face. There is no longer a direct confrontation between Israel and the Palestinians - instead directives come from Iran and Hezbollah with Syrian support," Harel writes in Thursday's paper.
The Israeli assessments begged the question of whether military operations in Syria might be in the offing. Deputy Defense Minister Ze'ev Boim's answer was prompt. "The rule that 'anyone who deals in terror against Israel is a target' is a rule that must be stated and one that we must stand behind."
Last October, breaking long precedent in response to a deadly bombing at a crowded seaside Haifa restaurant, Israeli warplanes bombed a suspected terrorist training base near Damascus. It was the first Israeli attack deep inside Syrian territory in more than two decades.
In any case, Boim maintained, Israel would take care not to cause a "conflagration" if it were to attack again on Syrian soil..
"I believe that it is possible to carry out these attacks by correct selection of targets, in the correct 'dosage,' setting out the red lines that must be set out, without thinking in terms of massive conflagration, which is certainly not in our interest," Boim said..
Asked to specify the evidence of a Syrian connection, Foreign Minister Silvan Shalom declined to respond directly, but said, in an apparent reference to the Damascus-based Hamas command:
"Syria is involved in terror all the time. Syria is responsible for acts of terrorism and granting patronage for terror, and therefore we view it as responsible the moment that those organizations receive direct orders from their headquarters in Damascus.
"When Syria is responsible, it must of course understand that there are some quite clear results."
Asked about the evidence, Foreign Minister Silvan Shalom declined to respond directly, but said, in an apparent reference to the Damascus-based Hamas command:
"Syria is involved in terror all the time. Syria is responsible for acts of terrorism and granting patronage for terror, and therefore we view it as responsible the moment that those organizations receive direct orders from their headquarters in Damascus.
"When Syria is responsible, it must of course understand that there are some quite clear results."
Israeli officials have singled out Damascus-based Hamas . Deputy political bureau head Moussa Abu Marzook, as the senior commander behind the bus bombings. Long on Israel's hit list, Abu Marzouk is also wanted in the United States.
U.S. authorities detained Abu Marzouk in 1995 on suspicion of having set up and used ostensible charities in the United States in order to mobilize financial and political support for Hamas. U.S. authorities deported him to Jordan in 1997. But he was indicted in absentia earlier this year along with two suspected Hamas operatives still living in the United States, for allegedly recruiting and soliticiting funds for a terror organization.
Last year, the U.S. government designated Abu Marzouk as a Special Designated Global Terrorist Entity, along with Hamas leaders Sheikh Ahmed Yassin, Abdel Aziz Rantisi, and Khaled Mashal, freezing their assets and barring financial transactions with them.
The Israeli military assassinated Sheikh Yassin in March, and Rantisi six months later.
Mashal, whom Israeli sources have also linked to the bombings and other terror operations within Israel, remains along with Abu Marzouk near the top of Israel's list of most-wanted terror commanders. Mashal narrowly recovered from a sophisticated, ultimately disastrous Mossad assassination attempt in Amman in the 1990s.
Senior Hamas official Osama Hamdan Thursday cautioned Israel that the militant Islamic organization "will not sit idly by" if Israeli forces attempt to assassinate its leaders aboad, Israel Radio reported.
Hamas has said in the past that it would view such an attack as a "green light" to attack Israeli targets overseas.
At least one Israeli figure said that the benefit of military action might outweigh the risk of conflagration. Said senior Likud lawmaker Yuval Steinitz, chairman of the key Knesset Foreign Affairs and Defense Committee:
"Sooner or later, Israel will have to set down a red line with respect to the reality in Lebanon. In the past, when the Syrian army tried to move into the south with tanks, artillery and infantry, we attacked and set a red line , such that the Syrian army would not move heavy arms and units south of the Beirut-Damascus line.
In recent years, however, the pro-Iranian Lebanese Hezbollah has been shifting into south Lebanon missiles and rockets capable of reaching Haifa Bay and the Israeli heartland, Steinitz continued.
"Whether by sinking a boat, or [attacking] a truck convoy or by striking storehouses, the time has come for us ? even at the price of the danger of conflagration ? to set down a red line and declare 'This is it. We will not allow heavy surface-to-surface missiles to be deployed in Lebanon, and to pose a significant strategic threat to northern central Israel."



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Syria: Israeli threat against Damascus lacks credibility
By Haaretz Service
Syria said on Thursday that Israeli threats to retaliate for Damascus' alleged complicity in Palestinian suicide bombings that killed 16 Israelis in Be'er Sheva on Tuesday lacked credibility.
"The launching of premature Israeli threats against Syria lacks the least degrees of credibility or evidence," the official SANA news agency quoted Foreign Minister Farouq Shara as saying, adding that the threats "exacerbate the deteriorating situation in the region."
Earlier Thursday, Israel and Hamas traded warnings of possible attacks in the wake of the Tuesday bus bombings in Be'er Sheva, as Deputy Defense Minister Ze'ev Boim said Israel should should consider military action against targets within Syria.
Senior Hamas official Osama Hamdan Thursday cautioned Israel that the militant Islamic organization "will not sit idly by" if Israeli forces attempt to assassinate its leaders abroad. Hamas has said in the past that it would view such an attack as a "green light" to attack Israeli targets overseas.
Boim, discussing Israel's charges that Damascus bore responsibility for the Tuesday suicide bombings that killed 16 people, said Thursday that "The rule that 'anyone who deals in terror against Israel is a target' is a rule that must be stated and one that we must stand behind."
Israel would in any event take care not to cause a "conflagration" if it were to attack again on Syrian soil, Boim added.
"I believe that it is possible to carry out these attacks by correct selection of targets, in the correct 'dosage,' placing the red lines that must be placed, without thinking in terms of massive conflagration, which is certainly not in our interest," Boim said in remarks broadcast on Israel Radio.
Government sources have fingered Moussa Abu Marzook, a senior Hamas official now residing in Damascus who is also wanted by the United States, as the individual behind the bombings. News reports have also mentioned Hamas leader Khaled Mashal, also based in the Syrian capital.
"There is no immunity, and if there is a need, we will act," Boim said.
Israel has provided the U.S. with "concrete evidence" of Syrian involvement in the bombings, Israel Radio reported Thursday. Asked about the evidence, Foreign Minister Silvan Shalom declined to respond directly, but said, in an apparent reference to the Damascus-based Hamas command:
"Syria is involved in terror all the time. Syria is responsible for acts of terrorism and granting patronage for terror, and therefore we view it as responsible the moment that those organizations receive direct orders from their headquarters in Damascus.
"When Syria is responsible, it must of course understand that there are some quite clear results."
Less than a year ago, the Israel Air Force attacked targets in Syria in response to a deadly bombing at a popular seaside restaurant in Haifa.
Shalom, who is leaving for Holland for talks with European Union foreign ministers, said "As a matter of principle, in the past we have not rushed to attack Syrian targets. When that it done, it will be done after in our opinion that Syria has crossed the red line."
Defense Minister Shaul Mofaz said Wednesday that "a large portion of the terrorism in the territories" comes from Hamas headquarters in Damascus and Hezbollah in Lebanon. You cannot separate what happened in Be'er Sheva from what is going on in Lebanon."
Prime Minister Ariel Sharon also blamed the Be'er Sheva bombing on Hamas headquarters in Damascus, and Israel Defense Forces Chief of Staff Moshe Ya'alon threatened with unspecified reprisals.
"Anyone who is responsible for terrorism against us should not sleep quietly," said Ya'alon, when asked by Knesset reporters how Israel would respond to Tuesday's suicide bombings. "We will deal with all those who support terror, at every level - people in the Palestinian Authority; people in Hezbollah in Lebanon; people in the terrorist headquarters in Damascus, which operate with Syria's permission; and also the financial support and weaponry that is transferred to the terrorist organizations under Iran's auspices."
He declined to give any details of what Israel's response might be.


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>> SPY PROBE...
Breakdown in CIA-Mossad ties: Tenet reduced cooperation following Iraq War, officials say
Intelligence sharing between the United States and Israel has been steadily cut back during the 16 months since the war with Iraq as former CIA Director George Tenet became uneasy with his colleagues in Mossad, according to U.S. and Israeli intelligence sources...


FBI probe of AIPAC said to go beyond alleged mole
By Haaretz Service
In a report that hinted of possible security breaches beyond the allegations that Pentagon analyst Lawrence Franklin passed information to Israel via AIPAC, the Washington Post reported Thursday that classified intelligence from the National Security may have been passed to the Jewish state.
Quoting unnamed U.S. officials and other sources, the paper said that the FBI had been investigating for more than two years whether the AIPAC pro-Israel lobbying group has been passing classified intelligence data to Israel.
"The counterintelligence probe, which is different from a criminal investigation, focuses on a possible transfer of intelligence more extensive than whether Franklin passed on a draft presidential directive on U.S. policy toward Iran, the sources said. The FBI is examining whether highly classified material from the National Security Agency, which conducts electronic intercepts of communications, was also forwarded to Israel," the paper said,
Israel responded that the characterization of the probe was speculative. "We are aware of all the speculation, but that is all it is. We have not heard anything official, and U.S.-Israeli relations remain as strong as ever and, as far as we are concerned, it's business as usual," said David Siegel, spokesman of the Israeli Embassy here.
AIPAC has forcefully denied that any of its personnel received classified information.
"National security adviser Condoleezza Rice and her deputy, Stephen J. Hadley, were apprised of the FBI counterintelligence investigation of AIPAC as a possible conduit for information to Israel more than two years ago, a senior U.S. official said late yesterday. That official and other sources would discuss the investigation only on the condition of anonymity because it involves classified information and is highly sensitive," the Post report said.

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U.S. Spy Probe Focuses on Two Lobbyists
NewsMax Wires
Wednesday, Sept. 1, 2004
WASHINGTON -- Two employees of the main pro-Israeli lobbying group are the focus of an FBI investigation into whether a Pentagon employee provided them with classified material about Iran that was passed on to Israel.
U.S. government officials, speaking Wednesday on condition of anonymity because of the ongoing investigation, confirmed the identities of the two American Israel Public Affairs Committee employees as director of foreign policy issues Steven Rosen and Keith Weissman, an Iran expert.
The FBI interviewed both men on Friday, the same day that news first surfaced about the investigation of the Defense Department analyst, Larry Franklin. Franklin works on issues involving Iran and the Middle East in the office of Defense Department policy undersecretary Douglas Feith.
No charges have been brought or arrests made in the case. Law enforcement officials have said prosecutors are weighing whether to charge anyone involved with the most serious offense of espionage or with lesser counts of mishandling classified documents.
AIPAC attorney Nathan Lewin did not immediately return a telephone call Wednesday about the FBI interviews with the group's two employees. AIPAC officials have said they are cooperating in the probe and have denied any wrongdoing, as has the Israeli government. Franklin has not responded to several telephone calls seeking comment.
The FBI and Justice Department have briefed a number of high-level Pentagon, congressional and White House officials about the investigation. Secretary of State Colin Powell was briefed Sunday over the telephone by Deputy Attorney General James Comey, a State Department spokesman said.
Meanwhile, a West Virginia college where Franklin teaches history courses is not planning any action regarding his status at the school while the investigation continues. For about five years, Franklin has been an adjunct professor of history at Sheperd University while living in nearby Kearneysville, said history department chairman Anders Henriksson.
Franklin "has been a real asset" to the school, Henriksson said. Franklin teaches freshman courses in world history and Asian traditions, he added. The school planned to provide extra security to prevent disruption of his Tuesday night course.


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>> IRAQ

Rebel Cleric Must Be Defeated Before His Militia Regroups, Top U.S. Commander Says
By Jim Krane Associated Press Writer
Published: Sep 2, 2004
BAGHDAD, Iraq (AP) - The fight with renegade Shiite cleric Muqtada al-Sadr is not over and the U.S. military must retake his stronghold in Baghdad's Sadr City slum, a top U.S. commander said Thursday.
Maj. Gen. Peter Chiarelli, commander of the Army's 1st Cavalry Division, said action is necessary before the volatile cleric has a chance to rebuild his Mahdi Mary militia, which was devastated in recent fighting.
"He's decided the best thing for him to do is to go underground and regroup," Chiarelli told The Associated Press. "We're not going to allow that to happen."
The Mahdi Army hasn't launched a significant attack on U.S. troops in two days, Chiarelli said. The rebel leader has not made a public appearance since the remnants of his militia departed Najaf's Imam Ali Shrine after a peace agreement last week.
U.S. military officials believe thousands of al-Sadr's inexperienced fighters were killed in two bouts of battles in Shiite cities in south-central Iraq, as well as in streets of Sadr City in east Baghdad, a district named after the cleric's father. That fighting began in April and flared again last month.
But militiamen remain heavily armed and in control of the northern half of Sadr City, a densely populated district of small alleys filled with booby traps and hidden bombs, he said.
Now, Chiarelli said, his Texas-based division needs to re-establish control over that area before al-Sadr's forces can regroup. The job will take a matter of weeks, Chiarelli said, giving no timetable for the start of an operation.
"Were going to go in and first, make Sadr City safe for the residents. We're going to make it very, very possible for the militia to disarm," Chiarelli said. "As long as there's a militia of any kind working at counter purposes to the government, we have a problem."
On Thursday, U.S. troops in Humvees and Bradley Fighting Vehicles used loudspeakers to call on militants in the slum to turn in their heavy weapons.
"All armed members of the Mahdi Army militia should hand over their heavy weapons as soon as possible, starting tomorrow," the troops said, designating a soccer stadium and the local U.S. headquarters as the drop-off points.
If it comes to a showdown with the U.S. military in Sadr City, no ultra-sensitive Muslim holy places will get in the Army's way, Chiarelli said, harking to how sensitivities over damaging the revered Imam Ali Shrine prevented a full-bore attack on al-Sadr's militia in Najaf.
"We feel very strongly that Sadr City is not Najaf," Chiarelli said. "You have a totally different set of parameters in Sadr City."
Avoiding civilian casualties in the crowded neighborhood, however, poses a difficulty. Some observers contend that U.S. assaults on al-Sadr's forces have only increased his popularity, particularly because he has twice emerged with his militia intact.
Despite a peace deal that ended three weeks of fighting in Najaf last week, many members of al-Sadr's militia are thought to have returned to Sadr City with their weapons.
Chiarelli said the group has laid bomb traps throughout the northern part of the district.
"There's a tremendous amount. I don't even want to venture a guess as to how many are there," Chiarelli said of the makeshift bombs, often fashioned from large artillery shells pilfered from old Iraqi military depots. "We've got to get rid of these, so that people aren't endangered by a 155 mm shell, daisy chained, three or four of them in a row, that blows up."
In a five-day stretch last month, U.S. troops disarmed or were hit by 82 hidden bombs in Sadr City, Chiarelli said.
"They either blew up or we disarmed them," he said.
Soldiers painstakingly removed hidden bombs from the neighborhood's southern section and now patrol the area in armored Humvees, said Chiarelli. But U.S. troops can only enter the north side in Abrams tanks or Bradleys, the general said.
The 1st Cavalry had to lay off most of the 15,000 Iraqis it hired to repair electrical, sewer and water infrastructure in Sadr City, with work stalled until the Army regains control, Chiarelli said.
Meanwhile, U.S. military and the government of interim Prime Minister Ayad Allawi have balked at al-Sadr's cease-fire overtures that call for U.S. troops to pull out of the neighborhood.
"That allows a very small group of very, very well armed individuals to intimidate the population. We're not going to let that happen," the general said, commending Allawi's stand against al-Sadr and private militias.
"So far the pronouncements of the government have all been in line with what we think needs to be done in Sadr City," he said.
AP-ES-09-02-04 1609EDT





Al-Sadr linked to mass killings
By Rowan Scarborough
THE WASHINGTON TIMES
A U.S. military intelligence report says that followers of radical Shi'ite cleric Sheik Muqtada al-Sadr imprisoned, killed and mutilated Iraqis who opposed his insurrection.
American intelligence officers are now investigating in the town of Najaf, the site of Sheik al-Sadr's bloody standoff with coalition forces. A U.S. military officer told The Washington Times that the command recently acquired photos of 15 to 20 mutilated bodies that appear to be Iraqis lying in a courtyard.
A written U.S. intelligence report, a copy of which was obtained by The Washington Times, puts the body count much higher, based on an Iraqi informant, some of whose information was confirmed by local police.
The report said that after last week's truce, Iraqi forces moved into buildings held by the radical cleric's Mahdi's Army militia and found the bodies.
"Inside the court building, Iraqi police found approximately 200 mutilated bodies taken by the Moqtada militia for speaking out against Moqtada al Sadr," said the intelligence report sent to the Pentagon and stamped "secret."
"Some of the prisoners had eyes and ears drilled out and others had their limbs and heads cut off. Some males had genitals cut off and shoved in their mouths. There was evidence of rape to men, women and children," according to the report.
The senior officer, who asked to remain anonymous, said that the number of bodies found is much less than 200. The source said that while it appears certain that the bodies exist, the circumstances of when and where the people were killed, and by whom, remained unknown yesterday.
"We don't have a complete picture of where they came from," the officer said. "We're trying to uncover what really happened before we are able to release information."
The source said that the U.S. command in Baghdad only learned of the deaths Sunday, and later acquired the photographs of mutilated bodies.
"There appears to be a large group of bodies that were uncovered," the officer said.
He said that a military-intelligence unit was in Najaf investigating the deaths, alongside Iraqi police.
Sheik al-Sadr has led several deadly uprisings in southern Iraq, unleashing his rifle-toting, ragtag army on coalition forces and innocent civilians. U.S. Army and Marine units have responded by attacking and killing scores of the fighters.
Sheik al-Sadr holed up in Najaf's main mosque for days before Iraq's leading Shi'ite, Grand Ayatollah Ali al-Sistani, returned from Britain and helped negotiate a cease-fire on Thursday.
The sheik's aides say that he now may choose to enter politics. But if his Mahdi's Army is tied to the massacre of innocent Iraqis, he could face a criminal investigation.
"The commander of the Sadr movement, leader Muqtada Sadr, announced today in Najaf the end of all fighting in the whole of Iraq and the integration of his movement in the political process," Sheik Naim al-Qaabi said last week.
U.S. military sources have told The Times that Iranian money helped Sheik al-Sadr rise from an obscure cleric during Saddam's rule to an influential rebel who paid a large army, provided social services and opened a rabble-rousing newspaper.
Earlier this year, the coalition shut down the newspaper after it called for the killing of al-Sadr opponents. The U.S.-led allies also began arresting some of his top aides. Looking boxed in, Sheik al-Sadr openly called for a rebellion that touched off a series of urban battles against American soldiers.
The U.S. intelligence report obtained by The Times states that most of Sheik al-Sadr's recruits were criminals that Saddam released from prison weeks before the March 2003 invasion.
The report states, "They slaughtered the innocent people. Most of the al-Mahdi were criminals jailed during the former regime and released by Saddam before his capture."


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U.S. military: Reconstruction
of Iraq is behind schedule
SPECIAL TO WORLD TRIBUNE.COM
Thursday, September 2, 2004
U.S. military officials said that despite pumping $18 billion into the reconstruction of Iraq, the United States has failed to make a significant dent in either the Shi'ite or Sunni insurgency.
The officials pointed to the Al Qaida-inspired takeover of several Iraqi cities, including Faluja, Ramadi and Samara as well as the endurance of the Iranian-backed Mahdi Army in wake of its month-long showdown with the U.S. military in Najaf.
Ramadi is in the Anbar province near the Syrian border, where nearly 150 U.S. soldiers have been killed in fighting Sunni insurgents.
Lt. Gen. Lance Smith, deputy chief of U.S. Central Command, said that so far the U.S.-led military coalition has not accomplished its major goals in Iraq, Middle East Newsline reported. Smith said this has included the establishment of a democratic Iraq as well as the elimination of terrorism and weapons of mass destruction.
The assessment by the military came as U.S. officials expect the White House to reduce the American military presence in Iraq in 2005. Currently, Washington has sought to achieve sufficient stability to enable Iraqi national elections in January 2005. Officials said the Bush administration plans to transfer funds allocated for Iraqi reconstruction to the training and equipping of Iraqi security forces.
Smith told the Egyptian state-owned Al Ahram daily that the United States has pumped $18 billion into the reconstruction of Iraq. He said this has included the training and organizing of Iraq's military and security forces.
The general said much of the violence in Iraq, including insurgency attacks, stemmed from the lack of legitimate employment. He said the United States would continue to invest to create economic opportunities, particularly for young Iraqis.
Smith said Israel was not helping the U.S.-led effort in Iraq. He denied reports that U.S. special forces were training at military bases in Israel.
The general differentiated between the U.S. military presence in Iraq and Afghanistan. Smith said the United States would leave Iraq as soon as possible, but envisioned a much longer stay in Afghanistan. He cited Iraq's modern orientation and energy resources.
Smith's assessment appeared to echo that of his superiors, including Central Command chief Maj. Gen. John Castellaw. Castellaw acknowledged the slow pace of the U.S.-led effort to stabilize Iraq.
"It never goes as fast as you want to go, but we continue to have successes," Castellaw told a briefing in the Qatari capital of Doha on Aug. 31. "Though we like to run sprints, in the case of Iraq, Afghanistan and other places that we have been, we know that it takes a while to accomplish the objectives."
At the same time, Castellaw refused to disclose a timetable for the withdrawal of U.S. troops from Iraq. He suggested the success of the Iraqi elections would comprise the key to any decision for a coalition withdrawal.
"We want it to be sooner rather than later," Castellaw said. "And we don't want to come up with some date as we are following an event driven schedule."
Gen. Richard Myers, the chairman of the Joint Chiefs of Staff, said the Sunni Triangle - the area north and west of Baghdad - has remained a major challenge to the U.S.-led coalition and the Iraqi government. At the same time, Myers told an audience in Nashville, Tenn. on Aug. 31 that the long-term prospect in Iraq "is very, very good."
Copyright ? 2004 East West Services, Inc.


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>> PAKISTAN


The al-Qaeda striptease
By B Raman
Act 1: March 2002. Abu Zubaidah, a Palestinian member of al-Qaeda, was arrested in Faislabad in Pakistani Punjab by the Pakistani authorities and handed over to the US's Federal Bureau of Investigation (FBI). He was the operational chief of al-Qaeda; his arrest was a major breakthrough, we were told. This is hardly supported by the report of the 9-11 Commission.
Act 2: September 2002. Ramzi Binalshibh was arrested in Karachi and handed over to the FBI. He was the man, we were told. Not Abu Zubaidah. A real breakthrough, it was claimed. He figures frequently in the commission's report, but one does not get the impression that he was as great a cat's whiskers as made out to be.
Act 3: March 2003. Khalid Sheikh Mohammad (KSM) was arrested in Rawalpindi and handed over to the FBI. What a breakthrough, it was said. The real mastermind of September 11. The evil genius of al-Qaeda. Of all the jihadi terrorists, he figures the most frequently in the report. Almost as frequently as Pakistan's President General Pervez Musharraf. The report does give the impression that KSM was the brain who conceived of the plans for September 11, and orchestrated their execution. He is a Pakistani from Balochistan, who grew up in Kuwait. The plans, which led to the destruction of the two towers of the World Trade Center in New York and to the attack on the Pentagon and which caused the deaths of 3,500 innocent men, women and children, were conceived not by the brain of Osama bin Laden or a Muslim of any other nationality.
They were conceived and executed by the mind of a Pakistani. If KSM was the mastermind and he was the real evil genius, how about those in Pakistan who sheltered and protected him in Karachi from 1998 until September 2002, when he ran away to Quetta when the FBI came to know of his presence in Karachi? How about those who sheltered him in Quetta? How about those in Pakistan's Jamaat-e-Islami (JEI) and army who sheltered him in Rawalpindi, right under the nose of Musharraf, when he fled there from Quetta, when the FBI established his presence in Quetta? Are they any the less evil? The commission, which goes into great detail on his activities from Karachi before September 11, is strangely silent on his activities there between September 11 and March, 2003. An American journalist of Indian sub-continental origin, who is a good personal friend of Marianne Pearl, the widow of Daniel Pearl, the US journalist kidnapped and beheaded in Karachi in February, 2002, mentioned in an article in the online journal Salon in October last year that the US intelligence had informed Marianne that it was KSM who had her husband killed. That means, KSM is a good friend of Omar Sheikh, who organized the trap for Daniel. That means, Pakistan's Inter-Services Intelligence (ISI), which was operating Omar Sheikh as a source, must have known of this friendship. That means, the ISI must have known of KSM's presence in Karachi even in 2002, if not before. Why did it not act against him?
The biggest deficiency in the 9-11 Commission's report is that it has restricted its enquiries to what happened before September 11. It has not gone into what happened after September 11 - the kidnapping and beheading of Pearl, the grenade attack in an Islamabad church in March 2002 which killed the wife and daughter of an American diplomat, the attack on French submarine engineers in Karachi thereafter and the car bomb explosion outside the US consulate in Karachi in June 2002. Without going into them, how can one assess what is the threat today and what will be the threat tomorrow?
The reason why the commission did not go into post-September 11 happenings is not difficult to understand. The US intelligence did not want it to. From the sanitized summaries of the interrogation reports shared with the commission, the Central Intelligence Agency (CIA) and the FBI excluded all references to post-September 11 developments. If they had shared them too, US public opinion would have been wiser about the continued collusion of the Pakistani intelligence, or at least sections of it, with Omar Sheikh, KSM and others after September 11 too. And if it had become wiser, it might have questioned the wisdom of the trust placed in Musharraf, widely known in Pakistan army circles as Tricky Mush, by the Bush administration. KSM also mentioned one Issa al-Brittani, whom he had sent to the US before September 11 at bin Laden's instance to case possible economic and Jewish targets in the US. The commission did not know anything about the identity of this al-Brittani. At least did the CIA and the FBI know about it?
Act 4: April, 2003. A man projected as a principal suspect in the case relating to the attack on the USS Cole, the US naval ship, at Aden in October, 2002, was arrested in Karachi. His name was initially given as Khalid bin Attash. It was subsequently changed to Walid bin Attash. It hardly matters whether you call him Khalid or Walid. You will be none the wiser. The choice is yours. A great catch, we were told. Musharraf got another pat in the back. From the commission's report, he does not appear to have been such a great catch. Another person was arrested along with bin Attash. A nephew of KSM, we were told. Handed over to the Americans. Disappeared from press headlines. Nobody knows whether he was identified and what happened to him.
Act 5: October 2003. Musharraf sent his troops into South Waziristan, much to the applause of the Americans. To smoke out bin Laden and other dregs of al-Qaeda. For the first time since Pakistan's creation in 1947, its army had ventured into this God forsaken area, we were told. Pakistan television reported the exploits of the army day after day, hour after hour. Al-Qaeda's camps destroyed. Dozens killed and arrested. So we were told. The only confirmed killing so far is that of Hassan Mahsun, an Uighur terrorist. What happened to those arrested? Innocent Pakistani tribals or Arabs? Al-Qaeda or something else? When you are watching a striptease show, you should not ask questions. Just watch.
Act 6: February-March, 2004. The Pakistan army ventured back into South Waziristan. A high-value target surrounded, we were told. Ayman al-Zawahiri, the Egyptian No 2 to bin Laden, Musharraf told the US officials and media, which lap up whatever he says just as they lapped up everything Ahmed Chalabi told them about Iraq. It turned out to be an Uzbek. Tohir Yuldeshev, leader of the Islamic Movement of Uzbekistan. There would have been some saving grace at least if he had been caught. No. He managed to just drive through a Pakistani army cordon and escape to fight another day. Doesn't matter, said Sheikh Rashid Ahmed, Pakistan's Information Minister. The army had caught or killed dozens of other al-Qaeda dregs, he claimed.
Act 7: June. Within a few days of an abortive attempt to kill the Corps Commander of Karachi, Faisal Saleh Hyat, Pakistan's Interior Minister, proudly announced the case had been solved and those responsible arrested. They belonged to an organization called Jundullah (Army of Allah), he said. A new organization, of which the ISI was not aware till then, we were told. Trained in South Waziristan by al-Qaeda, we were further told. South Waziristan had been swarming with Pakistani troops, helicopter gunships and 007s of the US since October, 2003. How come al-Qaeda managed to run training camps right under the nose of the Pakistan army and American 007s just as KSM had managed to live right under the nose of Musharraf in Rawalpindi? Don't ask inconvenient questions. Just watch the show. You have no idea what more is to come. Along with the Jundullah members, one more guy was arrested. A nephew of KSM, we were told. How many nephews does KSM have? As many as the bras that a striptease dancer has. A woman of Karachi filed a habeas corpus in a Karachi court that the man arrested was her husband and not a nephew of KSM. In Pakistan, such fine distinctions are irrelevant. What matters is what Musharraf says. If he says he is a nephew of KSM, so he is.
Act 8: July 25. After an encounter lasting over 12 hours during which no one was killed and not many bullet marks were left anywhere, the ISI announced the arrest of a group of al-Qaeda members at Gujrat in Pakistani Punjab. The leader was a Kenyan national, we were told.
Act 9: July 29. Sorry. He was actually a Tanzanian. That, too, a famous Tanzanian. None other than Ahmed Khalfan Ghailani wanted by the US for his involvement in the explosions outside the US embassies in Kenya and Tanzania in 1998. When was his identity established and announced? Three hours before Senator John Kerry was to make his acceptance speech at the Democratic presidential convention. Investigation revealed that Ghailani had been living at Gujrat for some months. Many local police officers were suspended for not detecting his presence. It is learnt that in their explanations they admitted they were aware of his presence in Gujrat, but said that they had not acted against him because the ISI had brought and kept him there. Ghailani had escaped to Pakistan immediately after the explosions of 1998. How come the ISI was not aware of this all these years and became aware of it only just before the Democratic Party's convention?
Act 10: August. Tom Ridge, the US homeland secretary, announced with great fanfare that US intelligence had come to know of plans of al-Qaeda to blow up US and international economic targets in New York, New Jersey and Washington DC. It had cased those buildings. Heavily armed US security forces personnel took up positions around all these buildings. Barricades were put up. All staff and visitors were checked. Obliging TV channel crews beamed visuals of these all over the world. Many watched it. Including bin Laden, presuming he is still alive, and his boys. They now know the buildings which were not guarded. Someone in the US intelligence tipped off the press that the information was three years old. Sheepishly Ridge and his officers admitted that this was so. They said that this does not mean the danger is any the less. Al-Qaeda plans its operations years in advance. Nobody drew the attention of Ridge to the fact that KSM had reported about the casing of the economic targets by al-Brittani in his interrogation report. Why was the US public not informed of it at that time and why were no security precautions taken? Was it because no Republican Party presidential convention was due last year? Don't ask stupid questions. Watch the show.
Act 11: August. Faced with increasing skepticism, US officials leaked to the media that the information was from a so-called computer wizard of al-Qaeda, a Pakistani by the name of Mohammad Naeem Noor Khan, arrested in Lahore. The Pakistanis hit the ceiling. They accused the US of blowing a sensitive ongoing operation by revealing the identity of a collaborating detainee. They admitted such an arrest now that the US had blown his cover. It was he who led them to Ghailani, they claimed.
Act 12: August. The British got into the act. They arrested 12 persons - Dhiren Bharot alias Bilal, a Hindu convert to Islam, and 11 others, seven of them of Pakistani origin. Hey presto. Dhiren is none other than al-Brittani. Or, rather, al-Brittani was none other than Dhiren. A key al-Qaeda operative, said some. In fact, the leader of the local al-Qaeda cell, said others. The information came from the Pakistanis, admitted the British, but they had been keeping a watch on Dhiren even earlier. Dhiren and others were planning a terrorist strike against Heathrow airport, said the Pakistanis. No such information, said the British. Bin Laden and his al-Qaeda are very security conscious. How come they trusted Dhiren, a Hindu convert to Islam? Dhiren was known to KSM as al-Brittani and to Noor Khan as al-Hindi. Was he known to anyone else as al-Pakistani or al-Kenyan? His family had migrated to the United Kingdom from Kenya in 1973.
Act 13: August. The so-called nephew of KSM arrested in June back in the headlines. It was he who led the Pakistanis to Noor Khan and it was Noor Khan who led them to Ghailani, we were told.
Act 14: August. Like a magician taking rabbits out of his hat, as the Republican presidential convention and his visit to New York during which he is to meet Bush for another pat in the back approached, Musharraf started finding al-Qaeda dregs all over Pakistan - Arabs, Uzbeks, South Africans and Pakistanis. A plot for simultaneous attacks on Musharraf's palace and the US Embassy in Islamabad, general headquarters in Rawalpindi and other places discovered and foiled. Many more dregs arrested. Al-Qaeda penetrated. The days of its dregs numbered. Claims galore from the interior and information ministers. Pakistani backers of al-Qaeda identified and under watch. Do you know who is the principal backer, according to these ministers? Musharraf? No. Lieutenant-General Ehsanul-Haq, director general of the ISI? No. He is none other than Javed Ibrahim Paracha , a close associate of Nawaz Sharif and a member of Nawaz's faction of the Pakistan Muslim League. Yes sir. You now know how al-Qaeda had remained undetected all these years in Pakistan. Because of the support from Nawaz's Muslim League.
Should one laugh or cry? Don't do either. Keep watching the show. There are more striptease acts to come as the US presidential elections and the deadline for Musharraf to resign as the chief of the army staff (COAS) approaches. Bush and Tricky Mush need each other. And they both need bin Laden. Bush for winning re-election. Mush for getting US support for his planned violation of the Pakistani constitution in order to be able to continue as the COAS after December 31.
There is another striptease going on in Iraq.
Another show, another day.
B Raman is Additional Secretary (retired), Cabinet Secretariat, Government of India, New Delhi, and, presently, director, Institute For Topical Studies, Chennai, and Distinguished Fellow and Convenor, Observer Research Foundation (ORF), Chennai Chapter. Email: corde@vsnl.com




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>> CHINA

China's 2 Top Leaders Square Off in Contest to Run Policy
By JOSEPH KAHN
BEIJING, Sept. 1 - As China's leaders prepare to gather for a national planning session, the country's two top officials, Hu Jintao and Jiang Zemin, are engaged in an increasingly pointed power struggle that has begun to create cracks in the one-party system, Chinese officials and analysts say.
Tension between Mr. Jiang, the country's semiretired senior leader who still heads the military, and Mr. Hu, who replaced Mr. Jiang as Communist Party chief and president nearly two years ago, has begun influencing debates on issues like slowing the overheated economy, fighting corruption and assigning jobs, these people say. The most delicate matters are now often viewed within the party as battles between rival factions.
There are no signs that the political system has become as unstable as it was in 1989, when economic and political disputes, including over how to handle popular protests for democracy, divided the Politburo. Moreover, since the death of Mao Zedong in 1976, China's leaders have at times sparred over power and ideology without threatening one-party rule. Even so, some party officials say the split between Mr. Jiang and Mr. Hu has the potential to grow into a more direct confrontation, and both men are viewed as seeking to rally support ahead of the planning meeting this month in a bid to weaken or even displace the other. At a minimum, divided leadership seems likely to complicate policy making and efforts to carry out policies in a system that relies on clear direction from the top.
Purported differences between the men are often exaggerated in China's rumor-filled political discourse. But people in the government and party hierarchy, including a few who say they were skeptical about the possibility of a power struggle until recent months, say they see signs that the two leaders have associated themselves with opposing schools of thought.
Broadly speaking, Mr. Hu is seen as embracing the idea that China needs to focus more on populist social problems, like corruption, health care, income inequality and environmental pollution, while Mr. Jiang has often spoken about the importance of maintaining a high rate of economic growth as the first priority.
Mr. Jiang is viewed as more supportive of China's private sector and of delegating power to the provinces to control their economies. Mr. Hu and Prime Minister Wen Jiabao have been using central government controls to reduce wasteful state spending, curtail lending to cool the overheated economy, and support the largest state-owed conglomerates.
Several people also said that Mr. Hu and Mr. Jiang have also begun to diverge subtly on foreign policy, with Mr. Hu working to forge closer ties to European nations, especially France and Germany, and Mr. Jiang emphasizing the relatively cordial relationship he built with the United States in the late 1990's.
Mr. Jiang and Mr. Hu regularly appear together in public and do not openly oppose each other. But they have added fuel to speculation about the deteriorating state of their relations by dropping hints or casting aspersions at each other in party meetings, officials said.
Speaking at a ceremony commemorating the 100th anniversary of the birth of Deng Xiaoping last week, Mr. Hu praised Deng, the father of China's market-oriented overhaul, for having given up his party and military positions well before he died in 1997. His speech was widely interpreted as a jab at Mr. Jiang, 78, who has clung to power longer than many expected. "Comrade Deng Xiaoping early on advocated abolishing lifelong tenure for officials and leaders, and he set a personal example," Mr. Hu said, according to a transcript of his remarks released by the official New China News Agency.
He went on to emphasize the importance of completing the transition to younger leadership that began in 2002, when Mr. Hu was given his current positions. "The party's third generation of collective leadership with Comrade Jiang Zemin as its core made tremendous achievements," Mr. Hu said. "We, the new central collective leadership, are striving to unify and lead the whole party and people in continuing to advance this great endeavor."
Mr. Jiang has begun directly criticizing Mr. Hu, several officials said. He recently invited a dozen officials and scholars, including prominent advisers to Mr. Hu and Mr. Wen, to discuss domestic and foreign policy at a hotel in western Beijing. Mr. Jiang repeatedly expressed concerns that Mr. Hu and Mr. Wen had taken dangerous policy gambles that threatened China's social stability and economic growth, according to two people who were told about the meeting.
In another sign of jockeying, this summer Mr. Jiang restored a Communist tradition of holding secretive retreats at the seaside resort of Beidaihe. In doing so, he effectively overturned an edict banning such party perks that Mr. Hu had announced with fanfare last year.
The main source of tension between the two men is now said to be personnel changes that could be discussed at the September meetings, known as the Fourth Plenum, a full meeting of the Communist Party's powerful Central Committee.
People told about plans for the meeting said Mr. Hu intended to put forward a proposal to increase the number of vice chairmen of the Central Military Commission, the top military body, to five from three, potentially loosening Mr. Jiang's grip on the military. Mr. Jiang is now the chairman of the commission and Mr. Hu is one of the three vice chairmen. His proposal is seen as a step toward pressuring Mr. Jiang to retire, with Mr. Hu then taking control of the military.
Mr. Jiang, however, has declined to resign or to set a time for the transition, these people said. Instead, he has proposed elevating his longtime lieutenant, Vice President Zeng Qinghong, to join Mr. Hu as a vice chairman of the military commission, a move that could foreshadow a struggle to succeed Mr. Jiang when he does turn over the reins.
Mr. Jiang has also submitted a proposal to create an American-style national security council that would oversee China's defense and foreign policies. People told about the proposal said they considered it likely that Mr. Jiang would seek to become the first head of that council.
Mr. Hu and Mr. Wen have long been viewed favorably by party elders and reform-minded officials who want to see the party embrace at least modest political openness, and they developed reputations as dedicated, clean officials. But Mr. Wen, in particular, has seen his clout wane recently, even as he has waged a tough campaign to restrict investment and tackle corruption.
Several officials said Mr. Wen was damaged by a report that appeared in early July in the 21st Century Business Herald. The influential newspaper suggested that the prime minister's American-educated eldest son, Wen Yunsong, had garnered a substantial stake in the Ping An Insurance Company shortly before that company went public on the Hong Kong stock market earlier this year.
The report did not name Mr. Wen's son, but it provided details that pointed to him as an operator behind holding companies that had managed to acquire a pre-offering stake in the company, which is now valued at nearly $1 billion.
Chris Buckley contributed reporting for this article.
Copyright 2004 The New York Times Company
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Commentary: Is China's GDP just an accounting artifact?
Andy Mukherjee Bloomberg News
Thursday, September 02, 2004
Two words of advice for investors who will pore over China's third-quarter gross domestic product data to gauge if the country is succeeding in damping overheated economic growth: "Be careful."
It could be an exercise in futility, as shown by Carsten Holz, an economist at the Hong Kong University of Science and Technology, who recently attempted to reconstruct a key part of China's $1.4 trillion dollar GDP: private consumption.
Although Holz used official Chinese guidelines on how household spending surveys are to be used to compute consumption GDP, his final figures did not match the ones published by China's National Bureau of Statistics.
Holz drew the following conclusions:
China's published GDP value in any particular year is not comparable to that of any other year.
An official percentage figure for GDP growth in a particular year does not imply that final demand - the sum of consumption, investment and net exports - rose by that percentage from the previous year.
The official GDP statistics may be using wrong population data, overestimating rural population (which consumes less) and underestimating urban population (which consumes more).
Using separately released official population data, one would find that GDP in 2002 was perhaps several percentage points higher than the reported figure of 8.3 percent.
"Real growth in part then is an accounting artifact," says Holz. The National Bureau of Statistics "is unwilling to reveal its actual practices or is incapable of accurately specifying the practices it follows," the researcher says.
Investors should keep Holz's findings in mind as they evaluate third-quarter data next month to ascertain if China's growth has truly cooled from the second quarter's 9.6 percent and last year's 9.1 percent. Both of those will be revised now after the statistics bureau raised its growth estimate for the first half of 2003 by 0.6 percentage point.
The key lesson is that there are two sources of error in China's growth rate. One is inaccuracy of data, which can throw the GDP growth rate off the mark by as much as one percentage point in either direction. Still, if a predictable level of inaccuracy were the only problem with China's GDP, one might be able to live with it.
There's a more dangerous source of error: inconsistencies from year to year in how the Chinese authorities add up their faulty gross domestic product data.
And the inconstancies are utterly unpredictable.
There's "no possibility for me, or probably any outsider," Holz notes, "to evaluate whether there are inconsistencies, and if so, how big they are." The usual double checks, via energy or steel consumption, are invalid, he says.
To be sure, adding up consumption, investments and net exports is one way to calculate GDP. The other method, and the one China uses to compute the official growth rate, is to add up the "output," or the value added in agriculture, manufacturing, mining and services, and compare the tally with the previous year to arrive at a growth figure. Could it be that China measures "output" accurately, and then twists "expenditures" to match?
In other words, could overall GDP, and growth, be accurate, even when the share of household consumption in GDP is not? Holz doesn't think so. It's easier to compile expenditure statistics than it is to collate correct data on output and incomes, where the government "faces such difficult tasks as measuring value-added in the individual-owned catering industry," he says.
Large-scale inconsistencies probably began during the Asian financial crisis of 1998, when China's unemployment problem, already bad because of austerity drives in previous years, got worse. Zhu Rongji, the incoming prime minister, demanded 8 percent growth. With the rural economy in the grips of the country's worst floods in half a century, delivering that growth depended on the creativity of statisticians.
That's when, in the second half of 1998, "statistical falsification, previously confined to minor fudging, occasional gross distortions by specific enterprises or localities, and widespread exaggeration of output in rural collective industry, suddenly blossomed into a massive nationwide phenomenon," a University of Pittsburgh researcher, Thomas Rawski, said in 2000.
If it was crucial to show strong growth in the economy in 1998, at least on paper, then it's equally important to show a gradual deceleration now, when credit curbs have been placed to check overinvestment in industries like steel, motor vehicles and property. Many countries, their fortunes tied to Chinese growth, are waiting to see how the credit tightening works out.
GDP statistics for 2004 will probably show a mild slowdown. When analysts say they're confident of a "soft landing," what they may mean is that Beijing can make any landing look that way.
Bloomberg News
Copyright ? 2004 The International Herald Tribune | www.iht.com


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China's central banker warns on capital flows
Tian Ying Bloomberg News
Thursday, September 02, 2004
BEIJING The Chinese central bank governor, Zhou Xiaochuan, said Thursday that government efforts to slow the economy were at a key stage, with monetary policy becoming harder to implement because of rising inflows of foreign capital.
"The amount of foreign currency converted to yuan continues to grow at a fast pace, and the central bank is still putting a relatively high volume of base money into circulation," Zhou said in a speech posted on the Web site of People's Bank of China.
The central bank has to print yuan in exchange for foreign currencies to maintain the yuan's peg against the dollar, thus increasing the money supply and hampering efforts to ease the growth in lending. China used 536 billion yuan, or $65 billion, to soak up foreign exchange in the first half of this year, the central bank said in its quarterly report last month.
China's economy, the world's seventh-largest, grew 9.6 percent in the second quarter of 2004, slowing from a 9.8 percent pace in the first three months, after the government ordered banks to restrict lending to industries it has deemed overheated. These include steel, cement and real estate development.
The broad measure of money supply known as M2 grew in China by 15.3 percent in July from the same month last year. That was the smallest gain in two years; July was the second consecutive month that the growth of M2 stayed within the central bank's target of 17 percent. The bank is likely to release August money supply data around Sept. 10.
The government's tightening measures have shown preliminary success, Zhou said in the speech, which he delivered in the northern city of Tianjin. Growth of M1 and M2, as well as new lending, have dropped to a "relatively rational level," he said. But Zhou cautioned that any relaxation of policy may cause investment growth to rebound.
M1 is defined as cash in circulation and cash equivalent. M2 measures cash and liquid assets such as money market funds.
Investment in roads, factories and other fixed assets in China rose 31 percent in the first seven months of this year, the same pace as in the first half. Inflation reached a seven-year high of 5.3 percent in July.
Zhou's comments are the latest by senior leaders suggesting that the clampdown on credit is unlikely to be eased.
Rising exports, foreign direct investment and inflows of speculative capital are fueling demand for the Chinese currency. Exports reached a record $51 billion last month, while foreign direct investment in the first seven months of this year rose 15 percent from a year earlier, according to official data.
Bloomberg News
Copyright ? 2004 The International Herald Tribune | www.iht.com

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>> MALAYSIA

Anwar's freedom catches UMNO with pants down
By Ioannis Gatsiounis
KUALA LUMPUR - With the only viable opposition party all but knocked out of the picture and the ruling National Front (BN) promising reform but carrying on its brand of feudalism with impunity - in other words, just when the political climate in Malaysia seemed to reach a new nadir - things got interesting. On Thursday morning in Putra Jaya, a federal court in a 2-1 decision stunned the nation by overturning the sodomy conviction of Malaysia's most famous political prisoner, Anwar Ibrahim.
Anwar in 1998 was sacked as deputy premier by then prime minister Mahathir Mohamad and subsequently jailed on corruption and sodomy charges. The debacle touched off mass protests and gave rise to a reform movement centering on justice and human rights, as many Malaysians believed that Anwar, 57, was framed because he posed a political threat to Mahathir.
Anwar had already served his term for the corruption conviction and was down to his last appeal for his nine-year sodomy sentence when Judge Abdul Hamid Mohamad told the courtroom on Thursday, "We are not prepared to uphold the conviction. We therefore ... set aside the conviction and the sentence."
Now, beneath the euphoria and bewilderment - in a nation in which the courts are reputedly a puppet of the government - two burning questions persist: How will Anwar's release shape Malaysia's political landscape, and second, does it suggest a new dawn of reform in Malaysian politics?
When Mahathir's hand-picked successor Abdullah Badawi took over from the long-ruling Mahathir last October, speculation surfaced as to whether Abdullah might release Anwar. It was just as soon concluded that releasing the charismatic Anwar would be political suicide for Abdullah, who was - some say still is - struggling to form a political base within his United Malays National Organization (UMNO).
On Wednesday, however, Abdullah said he would not meddle in the courts' decisions. And it appears he did not. So stunned was even Anwar at the fact that he went out of his way to say, "I must thank Badawi for the decision."
To some observers such cap-tipping is a priori, as Abdullah had already assured the public that the judiciary was independent and the government would not tamper with court decisions. But, said Malik Imtiaz Sarwar, deputy president of the National Human Rights Society (HAKAM), "There's a fundamental defect in making this assurance." He added that while Abdullah deserves some credit for not tampering with a court ruling that just might seal his political fate, "We cannot say the rule of law prevails in Malaysia as of yet."
Added a longtime commentator: "There remain so many problems in the judiciary." Those seeking reform, he said, cannot afford to bask in this decision.
But at least, said the leader of the opposition, Democratic Action Party (DAP) chairman Lim Kit Siang, "It reminds us not to despair in our fight for democracy."
And with Anwar's release, that fight for democracy likely got a major jolt. Anwar assured supporters outside the courthouse: "I'm committed to the struggle with the opposition parties that are committed to reform. I'm starting it right away."
Under Malaysian law, he will need to wait five years to seek political office because of his corruption conviction. But the message is clear: he will not allow himself to be sublated by the party that sought to destroy him.
Whether he links up with Keadilan (Justice Party), the party that was formed in the wake of his ouster, is not known. But it is thought that his release will "breathe new life directly and indirectly into opposition parties", said Hassan Ali of the conservative Parti Islam SeMalaysia (PAS).
UMNO officials were not immediately available for comment. But most observers say the decision puts UMNO against the wall. "It puts pressure on UMNO to stand up to the issues they promised to address" when Abdullah became premier, Lim said. Among those issues were corruption, transparency, accountability and good governance.
Some say Anwar's release may cause further fissures within UMNO, with some members aligning themselves with Anwar and others behind UMNO Supreme Council member Razaleigh Hamzah, who unsuccessfully challenged Abdullah for the party presidency in July.
At cafes around Kuala Lumpur on Thursday, some Malaysians saw Anwar's release as an omen for Malaysian politics. "Let him stay in jail where he deserves to be," said Mohamad Yusuf Bachok, 52. "His release will only divide."
Indeed, the Anwar debacle embarrassed and exhausted many Malaysians, and finds them averse to change. If Anwar can't reverse this trend, needless to say his political comeback will be over before it gets started.
Columnist M G G Pillai said Anwar's release is nothing to fear. "A realignment of forces is good for Malaysia."
And a realignment is what he foresees. Part of the problem, Pillai said, is that UMNO has become an Islamic party, trying to outduel PAS for that title. "Both have talked up cutting off the hands of thieves - the only difference is UMNO will cauterize it and PAS use the blade directly," he quipped.
While Muslims here, most all Malays, make up 60% of the population, UMNO and PAS have alienated many Malay voters because Malay identity is not exclusively Islamic. It is in some ways distinct, with a unique history that Islam has confused.
By contrast, Keadilan has always played more to Malay rather than Islamic sensibilities. Anwar did spearhead an Islamic revival in Malaysia in the early 1980s, but his appeal has transcended ethnic and religious lines.
As recently as Wednesday, Anwar and his former party were all but forgotten. His final appeal on Thursday was seen as a foregone conclusion, considering the courts' corrupt history; few Malaysians were even tuning in. As well, Keadilan was virtually buried in the March parliamentary elections, with only Anwar's wife Wan Azizah Wan Ismail winning a seat in parliament. Anwar's battle back into politics will no doubt be an arduous one.
Anwar, in neck brace and wheelchair, was expected to fly to Munich immediately for treatment for his back, an injury he said was aggravated by a beating inflicted by Malaysia's former police chief after his jailing in 1998. When Anwar appeared in court the next day with a black eye, Mahathir said Anwar beat himself up. The police chief later confessed to the crime.
After his release on Thursday, Anwar told reporters, "I bear no malice against [Mahathir]. Let him retire." Mahathir retired last October. Anwar's plans are a little different.
Ioannis Gatsiounis is a New York native who has worked in Indonesia as a freelance foreign correspondent for various US dailies and co-hosted a weekly political/cultural radio call-in show. He now lives in Malaysia.
(Copyright 2004 Asia Times Online Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)



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`Reformasi' a la Malaysia
http://www.thejakartapost.com/detaileditorial.asp?fileid=20040903.E01&irec=0
The winds of freedom, it seems, are breezing through both Singapore and Malaysia these days. Just one week after newly appointed Prime Minister Lee Hsien Loong promised more freedom of expression for Singaporeans, Malaysia decided to release dissident figure Anwar Ibrahim from prison on Thursday.
The decision by the Malaysian Supreme Court to overturn the lower court's conviction of sodomy against Anwar was not totally unexpected. Ever since he took over the reins a year ago, Prime Minister Abdullah Badawi has shown signs of distancing himself from the more authoritarian policies of his predecessor Mahathir Mohamad. Last month, he launched a campaign against corruption involving people who at one time were close to Mahathir. It was simply a matter of time, therefore, for Badawi to address the question of Anwar Ibrahim's imprisonment six years ago, which was clearly politically motivated.
But most people did not expect the release to come so soon. The Supreme Court overturned the guilty verdict because the allegation of sodomy was not supported by evidence presented in the lower court. While the court reached its decision without any interference from the Prime Minister, there is no doubt that such a ruling would not have been tolerated if Mahathir was still in charge. Everyone, including most Malaysians, knows that Anwar went to prison for challenging Mahathir.
Malaysians have two good reasons to celebrate over the Supreme Court ruling: the release of one of their most colorful and intelligent politicians, and the fact that the rule of law has finally taken root in their country.
The rest of the world, including we in Indonesia, can only rejoice at this positive development.
Malaysia's economic success -- undoubtedly a tribute to Mahathir's leadership -- cannot be sustained unless the country starts building the necessary democratic political foundations: freedom of speech, freedom of the press, the rule of law, as well as credible free and fair elections.
The release of Anwar Ibrahim marks the beginning of the "reformasi" era in Malaysia. The next step should be the restoration of his good name and the removal of the restrictions banning him from politics until 2008. Malaysia must go through a period of reconciliation before it can move forward.
There is every reason to be positive.
Badawi is starting Malaysia's process toward democratization when the economy is on solid ground. He is not doing this out of economic pressures or foreign proddings, but more out of his own conviction that now is as good a time as any to do the job. And Malaysia is doing so in phases and with far less fanfare than what we did in Indonesia. Indonesia launched its reform movement at a time when its economy was falling apart in 1998. It was probably the worst time to begin and the country has continued to struggle to this day.
We in Indonesia wish Badawi and the Malaysian people success in their march toward greater democracy and the even greater prosperity that comes with it. The developments in Malaysia and hopefully Singapore too, can only be good for the Southeast Asian region.
Indonesia may be responsible for exporting the haze from our forest fires to Malaysia and to Singapore, but we can also take credit for some of those winds of freedom that have been blowing through Malaysia and Singapore.


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>> GOP


http://www.cato.org/pointstoponder.html

A Reform GOP?
Republicans need to prove that they're still the party of ideas.
Tuesday, August 31, 2004 12:01 a.m. EDT
Republicans gathered in New York this week will be advertising their accomplishments, and fair enough. Yet if President Bush and the rest of his Grand Old Party want to turn their wispy hold on power into a real governing majority, they'll reassert their ebbing claim as the party of ideas.
Measured in offices held, the GOP hasn't been this strong since the 1920s. Republicans hold the White House and both branches of Congress, albeit narrowly but also by dint of a historic mid-term election victory in 2002. The party also owns 28 of the 50 governorships, including in the large, dynamic states of Texas, Florida and California. With an incumbent President seeking re-election, the GOP has a chance to forge a real mandate to govern.
Yet there is also a sense that the GOP, especially its Congressional wing, has been drifting from the principles that brought it to power. In 2000, Candidate Bush described the GOP as the party of reform--from Social Security to Medicare, greater accountability in education and the "compassionate conservatism" of faith-based charity. Four years later, Americans are left wondering if Republicans still believe in that agenda, or if they're slowly being captured by the inertia of Beltway incumbency.
Granted, this is not the case on national security, where Mr. Bush has united the party behind the assertive use of American power. In a sense, all Republicans are "neoconservatives" now, or at least they are as long as Mr. Bush prevails in November. The party's realist, Brent Scowcroft wing is waiting to reassert itself if he loses--represented by the likes of Nebraska Senator Chuck Hagel--but for now those differences are muted.
Under Mr. Bush, the GOP has also become the natural home for cultural traditionalists. Partly this is because the Democrats have so heartily embraced Hollywood and secularism, but it has also been driven by Mr. Bush's heartland instincts. This works to the GOP's political advantage on such issues as guns, where a majority opposes state controls. But it may cost the party on such matters as stem cell research, where science clashes with the party's dominant anti-abortion wing. At least the GOP is debating such vital matters: Democrats long ago banished any anti-abortion dissent.
Perhaps the biggest question is whether the GOP can still rightly call itself the party of smaller government. The GOP Congress--as well as some of its state parties (Ohio, New York)--has seemed only too comfortable acting as the party of the incumbent status quo, dolloping out pork to any interest group that might help it remain in power. The result has been the largest farm bill in history, as well as the largest new entitlement (for prescription drugs) since the 1960s. Huge energy and highway spending bills failed not from principled opposition but from internal squabbling.
If Republicans want to see the perils of this strategy, they might look at the blue (Democratic) patches of the electoral map that are Illinois, New Jersey and Long Island. Once GOP strongholds, those areas all turned left after Republican machines grew corrupt and became little different from tax-and-spend Democrats. It's no accident that the dynamic and growing parts of the GOP are in the South and West, in places like Florida, where Governor Jeb Bush has promoted school reform, or Colorado, where Governor Bill Owens has returned tax surpluses to voters instead of growing the government.
Internal GOP resistance to some of President Bush's pro-growth, reform agenda shows that too much of the party still opposes change. A rump group in the Senate have prevented him from making his tax cuts permanent, though without those tax cuts Republicans would be heading for defeat this fall amid a much poorer economy.
Republicans in the House keep telling Mr. Bush to forget about personal Social Security accounts, despite their appeal to younger voters. And a nativist party faction has stood in way of his farsighted immigration reform that is essential if the GOP is ever going to attract enough Hispanic voters to sustain a majority amid sweeping demographic change.
If voters want to elect the party of the government status quo, they can and probably should turn to the Democrats. Republicans have to stake their claim to govern on individual empowerment and the reform of our unsustainable, New Deal public-sector monopolies. In this information age of global competition and rapid technological change, Americans want a party that will give them more control over their finances and pensions, their health care, and especially their time. We'll be looking for evidence this week that the Republicans want to be that party.


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How Strong Is the Arab Claim to Palestine?
By Lawrence Auster
FrontPageMagazine.com | August 30, 2004
There is a myth hanging over all discussion of the Palestinian problem: the myth that this land was "Arab" land taken from its native inhabitants by invading Jews. Whatever may be the correct solution to the problems of the Middle East, let's get a few things straight:
? As a strictly legal matter, the Jews didn't take Palestine from the Arabs; they took it from the British, who exercised sovereign authority in Palestine under a League of Nations mandate for thirty years prior to Israel's declaration of independence in 1948. And the British don't want it back.
? If you consider the British illegitimate usurpers, fine. In that case, this territory is not Arab land but Turkish land, a province of the Ottoman Empire for hundreds of years until the British wrested it from them during the Great War in 1917. And the Turks don't want it back.
? If you look back earlier in history than the Ottoman Turks, who took over Palestine over in 1517, you find it under the sovereignty of the yet another empire not indigenous to Palestine: the Mamluks, who were Turkish and Circassian slave-soldiers headquartered in Egypt. And the Mamluks don't even exist any more, so they can't want it back.
So, going back 800 years, there's no particularly clear chain of title that makes Israel's title to the land inferior to that of any of the previous owners. Who were, continuing backward:
? The Mamluks, already mentioned, who in 1250 took Palestine over from:
? The Ayyubi dynasty, the descendants of Saladin, the Kurdish Muslim leader who in 1187 took Jerusalem and most of Palestine from:
? The European Christian Crusaders, who in 1099 conquered Palestine from:
? The Seljuk Turks, who ruled Palestine in the name of:
? The Abbasid Caliphate of Baghdad, which in 750 took over the sovereignty of the entire Near East from:
? The Umayyad Caliphate of Damascus, which in 661 inherited control of the Islamic lands from
? The Arabs of Arabia, who in the first flush of Islamic expansion conquered Palestine in 638 from:
? The Byzantines, who (nice people--perhaps it should go to them?) didn't conquer the Levant, but, upon the division of the Roman Empire in 395, inherited Palestine from:
? The Romans, who in 63 B.C. took it over from:
? The last Jewish kingdom, which during the Maccabean rebellion from 168 to 140 B.C. won control of the land from:
? The Hellenistic Greeks, who under Alexander the Great in 333 B.C. conquered the Near East from:
? The Persian empire, which under Cyrus the Great in 639 B.C. freed Jerusalem and Judah from:
? The Babylonian empire, which under Nebuchadnezzar in 586 B.C. took Jerusalem and Judah from:
? The Jews, meaning the people of the Kingdom of Judah, who, in their earlier incarnation as the Israelites, seized the land in the 12th and 13th centuries B.C. from:
? The Canaanites, who had inhabited the land for thousands of years before they were dispossessed by the Israelites.
As the foregoing suggests, any Arab claim to sovereignty based on inherited historical control will not stand up. Arabs are not native to Palestine, but are native to Arabia, which is called Arab-ia for the breathtakingly simple reason that it is the historic home of the Arabs. The terroritories comprising all other "Arab" states outside the Arabian peninsula--including Iraq, Syria, Jordan, Lebanon, Egypt, Tunisia, and Algeria, as well as the entity now formally under the Palestinian Authority--were originally non-Arab nations that were conquered by the Muslim Arabs when they spread out from the Arabian peninsula in the first great wave of jihad in the 7th century, defeating, mass-murdering, enslaving, dispossessing, converting, or reducing to the lowly status of dhimmitude millions of Christians and Jews and destroying their ancient and flourishing civilizations. Prior to being Christian, of course, these lands had even more ancient histories. Pharaonic Egypt, for example, was not an Arab country through its 3,000 year history.
The recent assertion by the Palestinian Arabs that they are descended from the ancient Canaanites whom the ancient Hebrews displaced is absurd in light of the archeological evidence. There is no record of the Canaanites surviving their destruction in ancient times. History records literally hundreds of ancient peoples that no longer exist. The Arab claim to be descended from Canaanites is an invention that came after the 1964 founding of the Palestine Liberation Organization, the same crew who today deny that there was ever a Jewish temple in Jerusalem. Prior to 1964 there was no "Palestinian" people and no "Palestinian" claim to Palestine; the Arab nations who sought to overrun and destroy Israel in 1948 planned to divide up the territory amongst themselves. Let us also remember that prior to the founding of the state of Israel in 1948, the name "Palestinian" referred to the Jews of Palestine.
In any case, today's "Palestine," meaning the West Bank and Gaza, is, like most of the world, inhabited by people who are not descendants of the first human society to inhabit that territory. This is true not only of recently settled countries like the United States and Argentina, where European settlers took the land from the indigenous inhabitants several hundred years ago, but also of ancient nations like Japan, whose current Mongoloid inhabitants displaced a primitive people, the Ainu, aeons ago. Major "native" tribes of South Africa, like the Zulu, are actually invaders from the north who arrived in the 17th century. India's caste system reflects waves of fair-skinned Aryan invaders who arrived in that country in the second millennium B.C. One could go on and on.
The only nations that have perfect continuity between their earliest known human inhabitants and their populations of the present day are Iceland, parts of China, and a few Pacific islands. The Chinese case is complicated by the fact that the great antiquity of Chinese civilization has largely erased the traces of whatever societies preceded it, making it difficult to reconstruct to what extent the expanding proto-Chinese displaced (or absorbed) the prehistoric peoples of that region. History is very sketchy in regard to the genealogies of ancient peoples. The upshot is that "aboriginalism"--the proposition that the closest descendants of the original inhabitants of a territory are the rightful owners--is not tenable in the real world. It is not clear that it would be a desirable idea even if it were tenable. Would human civilization really be better off if there had been no China, no Japan, no Greece, no Rome, no France, no England, no Ireland, no United States?
Back to the Arabs
I have no problem recognizing the legitimacy of the Arabs' tenure in Palestine when they had it, from 638 to 1099, a period of 461 years out of a history lasting 5,000 years. They took Palestine by military conquest, and they lost it by conquest, to the Christian Crusaders in 1099. Of course, military occupation by itself does not determine which party rightly has sovereignty in a given territory. Can it not be said that the Arabs have sovereign rights, if not to all of Israel, then at least to the West Bank, by virtue of their majority residency in that region from the early Middle Ages to the present?
To answer that question, let's look again at the historical record. Prior to 1947, as we've discussed, Palestine was administered by the British under the Palestine Mandate, the ultimate purpose of which, according to the Balfour Declaration, was the establishment of a Jewish national home in Palestine. In 1924 the British divided the Palestine Mandate into an Arabs-only territory east of the Jordan, which became the Kingdom of Trans-Jordan, and a greatly reduced Palestine Mandate territory west of the Jordan, which was inhabited by both Arabs and Jews.
Given the fact that the Jews and Arabs were unable to coexist in one state, there had to be two states. At the same time, there were no natural borders separating the two peoples, in the way that, for example, the Brenner Pass has historically marked the division between Latin and Germanic Europe. Since the Jewish population was concentrated near the coast, the Jewish state had to start at the coast and go some distance inland. Exactly where it should have stopped, and where the Arab state should have begun, was a practical question that could have been settled in any number of peaceful ways, almost all of which the Jews would have accepted. The Jews' willingness to compromise on territory was demonstrated not only by their acquiescence in the UN's 1947 partition plan, which gave them a state with squiggly, indefensible borders, but even by their earlier acceptance of the 1937 Peel Commission partition plan, which gave them nothing more than a part of the Galilee and a tiny strip along the coast. Yet the Arab nations, refusing to accept any Jewish sovereignty in Palestine even if it was the size of a postage stamp, unanimously rejected the 1937 Peel plan, and nine years later they violently rejected the UN's partition plan as well. When the Arabs resorted to arms in order to wipe out the Jews and destroy the Jewish state, they accepted the verdict of arms. They lost that verdict in 1948, and they lost it again in 1967, when Jordan, which had annexed the West Bank in 1948 (without any objections from Palestinian Arabs that their sovereign nationhood was being violated), attacked Israel from the West Bank during the Six Day War despite Israel's urgent pleas that it stay out of the conflict, and Israel in self-defense then captured the West Bank. The Arabs thus have no grounds to complain either about Israel's existence (achieved in '48) or about its expanded sovereignty from the river to the sea (achieved in '67).
The Arabs have roiled the world for decades with their furious protest that their land has been "stolen" from them. One might take seriously such a statement if it came from a pacifist people such as the Tibetans, who had quietly inhabited their land for ages before it was seized by the Communist Chinese in 1950. The claim is laughable coming from the Arabs, who in the early Middle Ages conquered and reduced to slavery and penury ancient peoples and civilizations stretching from the borders of Persia to the Atlantic; who in 1947 rejected an Arab state in Palestine alongside a Jewish state and sought to obliterate the nascent Jewish state; who never called for a distinct Palestinian Arab state until the creation of the terrorist PLO in 1964--sixteen years after the founding of the state of Israel; and who to this moment continue to seek Israel's destruction, an object that would be enormously advanced by the creation of the Arab state they demand. The Arab claim to sovereign rights west of the Jordan is only humored today because of a fatal combination of world need for Arab oil, leftist Political Correctness that has cast the Israelis as "oppressors," and, of course, good old Jew-hatred.
Lawrence Auster is the author of Erasing America: The Politics of the Borderless Nation. He offers his traditionalist conservative perspective at View from the Right.


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Bin Laden's Operatives Still Use Dubai
By TAREK AL-ISSAWI
ASSOCIATED PRESS
DUBAI, United Arab Emirates (AP) -
Osama bin Laden's operatives still use this freewheeling city as a logistical hub three years after more than half the Sept. 11 hijackers flew directly from Dubai to the United States in the final preparatory stages for the attack.
The recent arrest of an alleged top al-Qaida combat coach is the latest sign that suspected members of the terrorist organization are among those who take advantage of travel rules that allow easy entry. Citizens of neighboring Gulf states such as Saudi Arabia can come to Dubai without visas, which other nationalities can get at the country's ports of entry.
Once here, it's easy to blend in to what has become a cosmopolitan crowd.
The Emirates is home to an estimated 4 million people, and nearly 75 percent of them are foreigners. In Dubai, expatriates of all nationalities are catered to, from concerts by top Western musicians to cricket and rugby matches to a German-styled Oktoberfest.
The expatriates, mostly from the Indian subcontinent and the Arab world, are employed in the real estate, insurance, tourism and banking sectors. Westerners, numbering in the tens of thousands, are employed as military advisers and oil specialists.
While the Emirates has taken concrete steps to fight terrorism since Sept. 11, 2001 - including making high-profile arrests, passing an anti-money laundering law, and imposing close monitoring procedures on charity organizations - the characteristics that make it an ideal place for legitimate business also attract militants and others with suspect motives.
In August, Pakistani Qari Saifullah Akhtar, suspected of training thousands of al-Qaida fighters for combat, was arrested in the Emirates and turned over to officials in his homeland, authorities in Pakistan announced.
Emirates authorities have refused to comment on Akhtar's arrest. They were similarly tightlipped in 2002, when the United States announced the arrest of Abd al-Rahim al-Nashiri, the suspected mastermind of the 2000 bombing of the USS Cole, which killed 17 U.S. sailors.
It was a month before Emirates officials confirmed al-Nashiri had been arrested here. Then they said he had been planning to attack "vital economic targets" in the Emirates that were likely to inflict "the highest possible casualties among nationals and foreigners."
The Saudi-born al-Nashiri, one of six Cole defendants in an ongoing trial in Yemen, is in U.S. custody at an undisclosed location. Besides the Cole attack, he is suspected of helping direct the 1998 bombings of U.S. embassies in Kenya and Tanzania, U.S. officials say.
With open borders, multiethnic society and freewheeling business rules, the Emirates remains vital to al-Qaida operations, said Evan F. Kohlmann, a Washington-based terrorism researcher.
Dubai still "plays a key role for al-Qaida as a through-point and a money transfer location," Kohlmann said, although he also noted the country could be working to combat such activity with "an aggressive but low-profile intelligence strategy."
Al-Qaida isn't the only organization that has found Dubai useful. The father of Pakistan's nuclear program, Abdul Qadeer Khan, has acknowledged heading a clandestine group that, with the help of a Dubai company, supplied Pakistani nuclear technology to Iran, Libya and North Korea.
Emirates officials refused to discuss the country's latest steps to combat terror.
Dia'a Rashwan, an Egyptian expert on militant groups, said trumpeting developments such as the arrest of al-Qaida suspects could be misread as serving the United States when the Emirates, led by its President Sheik Zayed bin Sultan Al Nahyan, cultivates an image as a champion of Arab causes. The Emirates nonetheless has a close relationship with Washington.
Rashwan said the reticence also could stem from fear that saying too much could cause "panic among the huge expatriate community, which is proportionally the largest in the Gulf."
Kohlmann said if more al-Qaida suspects are arrested in the Emirates, the network might retaliate with a strike here, perhaps on a U.S. mission or military target.
While the country has not been singled out as a target by al-Qaida, the United States issued a warning in June that it had "information that extremists may be planning to carry out attacks against Westerners and oil workers in the Persian Gulf region, beyond Saudi Arabia."
Security is tight in the Emirates, but not visible, and violent crimes are uncommon.
"The United Arab Emirates is considered a safe haven for everybody," said Emirates analyst Abdulkhaleq Abdulla. "It has not yet got entangled in any of the violence that other countries around it have experienced and it wants to keep that image."
Shortly after the Sept. 11, attacks, U.S. authorities said the United Arab Emirates, especially the commercial hub Dubai, was a major transit and money transfer center for al-Qaida.
A new report dated Aug. 21 by the U.S. commission investigating the Sept. 11 attacks provided the most detail yet on the extent to which the hijackers used Dubai as a travel hub.
According to the U.S. government, 13 of the 19 hijackers entered the United States between April 23 and June 29, 2001. And 11 of those late-arrivers - who were Saudi citizens and primarily the "muscle" for the hijackings - went through Dubai, according to the report.
The hijackers traveled in groups of two or three, taking off from Dubai and arriving at airports in Miami, Orlando, Fla., or New York City, the report said.
As for the money trail, Bin Laden's alleged financial manager, Mustafa Ahmed al-Hisawi, received at a Dubai bank a transfer of $15,000 two days before the Sept. 11 attacks and then left the Emirates for Pakistan, where he was arrested last year.
Marwan Al-Shehhi, an Emirates citizen and one of the hijackers, received $100,000 via the United Arab Emirates. Another hijacker, Fayez Banihammad, also was from the Emirates.
About half of the $250,000 spent on the attacks was wired to al-Qaida terrorists in the United States from Dubai banks, authorities said. Al-Qaida money in Dubai banks also has been linked to the 1998 U.S. Embassy bombings in Kenya and Tanzania.

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Posted by maximpost at 4:50 PM EDT
Permalink
Tuesday, 31 August 2004

Moscow fears two suicide bombers at large
By Andrew Osborn in Moscow
31 August 2004
Fears were growing yesterday that two "black widows" - female Chechen suicide bombers - were on the loose in Moscow, less than a week after two passenger airliners were blown out of the sky.
The two prime suspects in last week's explosions have been identified as the Chechens Amant Nagaeva and Satsita Dzhebirkhanova. Both had lost brothers in Chechnya's hostilities with Russia. Remains of the women's bodies were found in the wreckage of both planes, along with traces of a high explosive favoured by Chechen separatists. Eighty-nine people died in the almost simultaneous explosions.
The daily Izvestia reported yesterday that the two women did not travel to Moscow alone. The newspaper said that they had come with two other Chechen women with whom they had been living in Grozny, Chechnya's capital, Maryam Taburova and Roza Nagaeva (Amant's sister).
All four women were last seen taking a bus from Dagestan to an unknown destination on 22 August, two days before the planes were blown up. All were either divorced or single, and worked as market traders in Grozny's central market, selling children's clothes, which they obtained on monthly shuttle trips to Baku, the capital of Azerbaijan.
A photograph of Ms Taburova was published on Izvestia's front page yesterday under the chilling headline: "Another two suicide bombers."
The paper interviewed the two dead women's relatives in Chechnya, who suggested that they had been murdered and their passports used by real suicide bombers. Izvestia agreed that there were only two possibilities; that the four were genuine suicide bombers controlled by terrorists in Baku, or that their identities had been stolen by Baku-based terrorists who had murdered them.
The truth might emerge, it added, when the gruesome remains of Amant and Satsita are identified by their relatives. The populist newspaper Komsomolskaya Pravda published a grim photograph of Amant's headless, skinless corpse yesterday, which was barely recognisable as a human being. It claimed investigators had found a note in Arabic among her personal effects reading "Allah Akbar!" or "Allah is Great", the traditional rallying cry of Chechen separatist fighters.
Investigators have said they may need as much as a month and a half to piece together a full picture of exactly how and why the two planes were targeted.
There was confusion yesterday over the treatment that Russian airliners will receive in American airspace. The Washington Post has reported that they will be escorted by fighter jets primed to shoot them down if they are hijacked, but the Russian foreign ministry said yesterday that it had received no such official notification.
In Chechnya, meanwhile, the Kremlin's handpicked candidate was confirmed to have won the republic's presidential elections by a landslide. Alu Alkhanov, 47, a former policeman, was shown to have captured almost 74 per cent of the vote. His election was controversial, however. Mr Alkhanov's main challenger was barred from running on a technicality, Mr Alkhanovhad the media and the Kremlin on his side and at least two of his rivals complained of electoral irregularities.
The British Foreign Office minister Bill Rammell said: "We have serious concerns about the way these elections have been conducted ... another opportunity has been missed to build up the political process. Nevertheless, we hope Mr Alkhanov and the Russian authorities will now try to advance reconciliation in Chechnya."
30 August 2004 19:56
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Churchill 'ordered killing of Mussolini'
By Peter Popham in Rome
29 August 2004
Benito Mussolini was not killed by Italian partisans but by two secret agents acting on orders from Winston Churchill. That is the startling conclusion of a new investigation into the death of Il Duce.
Britain's wartime Prime Minister was desperate, an Italian documentary claims, to prevent secret letters coming to light in which he had tried to induce Italy to make a separate peace with the Allies. This was in defiance of his agreement with President Franklin Roosevelt at Casablanca that the war could end only with the unconditional surrender of the Axis powers. The programme, co-produced by a veteran American journalist, Peter Tompkins, and to be broadcast on RAI, Italian state television, tomorrow alleges that it was to prevent these embarrassing letters coming to light that Churchill ordered the murder of Mussolini and his mistress, Clara Petacci.
The film's credibility hinges on the evidence of former Italian partisan Bruno Lonati, who says he was one of the two-man team given the task of getting rid of the couple. The history books say Mussolini and Petacci were executed by partisans at the gates of a villa near Lake Como at 4.10pm on 28 April 1945. Subsequently their corpses were exhibited hanging upside down in a piazza in Milan.
But according to Mr Lonati, the secret assassination actually took place more than five hours earlier. He claims that he acted in tandem with a British Special Operations Executive agent codenamed Captain John, a Briton of Sicilian descent, real name Robert Maccarone, who had been sent to Italy with the specific mission of eliminating Mussolini.
Mr Lonati says that they went to the house near Lake Como where the couple had been held since their arrest, escorted them down a lane that led to the lake, stood them against a fence and opened fire with Sten guns. When they were dead, he claims, the British agent took out a camera and photographed them with Mr Lonati besides them. "Captain John" also referred to "very important documents" that he was ordered to retrieve from Mussolini.
Mr Lonati first advanced his claims to be Mussolini's assassin more than 10 years ago. He found few takers for the story. Peter Tompkins, who was himself a secret agent with the Allies in Rome in 1944, insists the account checks out. But a key piece of evidence - the photo of Mr Lonati with the bodies - is missing. Mr Tompkins believes that it may be in the possession of the British Embassy in Rome. The programme also repeats an old claim that the trips Churchill made to the Italian lakes after the war, supposedly to paint landscapes, were actually for the purpose of retrieving the letters.
But Mussolini's most recent biographer, Nicholas Farrell, says: "All the letters that have emerged are crude forgeries. The only genuine letters that exist between Churchill and Mussolini are two, written just before the war, in which Churchill begs Mussolini not to go into the war."


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IAEA Cites Doubts on Libya's Uranium
By Dafna Linzer
Washington Post Staff Writer
Tuesday, August 31, 2004; Page A15
Libya has offered conflicting information about whether North Korea or Pakistan was the supplier of uranium for its nuclear weapons program and has been unable to account for some equipment that could be used to make a bomb, according to the International Atomic Energy Agency, which released a report yesterday on its investigation of Libya and the nuclear blackmarket that supplied it.
IAEA inspectors said efforts to resolve one of the biggest mysteries about Libya's program were complicated by statements from one Libyan who said the uranium came from North Korea and from another who pointed the finger at Pakistan's top nuclear scientist, A.Q. Khan, who supplied much of the country's nuclear infrastructure.
The IAEA report, while making clear that some countries are cooperating with its investigation, reflects the difficulty its inspectors are having as they try to unravel the Pakistani blackmarket that supplied Libya and Iran and understand the extent of international trafficking in nuclear materials.
"We've had conflicting reports and we can't nail it down," one IAEA official said, referring to the competing claims about Libyan suppliers. "But if North Korea is another player in the black market than things are much worse than we know," the official said on condition of anonymity because of the matter's sensitivity.
In Washington, a Bush administration official familiar with the report said the source for the North Korea claim was credible, but there was nothing else to corroborate the story. Pyongyang admitted to a secret nuclear program in 2002 that relied on plutonium.
North Korea is not believed to have the capability to supply the type of uranium found in Libya, and there has been no firm evidence that it provides nuclear materials to other countries.
Throughout the IAEA report, which was written ahead of the agency's Sept. 13 board meeting, Libya is praised for providing inspectors with access to facilities and responses to inquiries. But the report also notes that Libya has failed to account for sophisticated enrichment technology which could have been stolen, hidden or lost, and notes that some of Libya's responses have not been borne out by test results and soil samples.
Despite Libya's commitment to the United States and Britain to come clean about its weapons programs, "there are gaping holes in this investigation," said another IAEA official.
"Much of what the Libyans have told us appears to be consistent with our findings but the black market is still murky enough that we're not closing any doors right now," the official said. Libya is hoping that the IAEA's board will agree next month that the country no longer requires special inspections.
The IAEA has been active in Libya since President Moammar Gaddafi agreed to give up his biological, chemical and nuclear weapons programs in December 2003 as part of a deal that ended years of sanctions against the country for its role in the 1988 bombing of a Pan Am jet that killed 270 people in Lockerbie, Scotland.
The White House often cites Libya's decision as evidence of progress in its efforts to keep weapons of mass destruction out of the hands of terrorists. On Monday, a campaigning President Bush said Gaddafi had "heard a clear message and voluntarily got rid of his weapons of mass destruction program."
Libya's decision exposed Khan and the IAEA believes that he and a network of middlemen in 20 countries supplied both Libya and Iran with equipment and technology for enriching uranium.
Khan also is expected to feature prominently in a separate IAEA report due out later this week on Iran, which claims its equipment is for use in a program designed produce energy, not weapons. Khan, the father of Pakistan's nuclear program, is considered a national hero at home. Despite his activities, he was pardoned by Pakistani president Pervez Musharraf and lives under government protection.
The agency is currently conducting forensic analysis of warhead designs Khan gave Libya in an effort to determine whether the drawings were copied or shared with other countries. The designs were Chinese in origin, obtained by Pakistan and then sold by Khan.
The report also expressed some frustration with the level of cooperation by Pakistan. In a veiled reference to Khan and Pakistan, the agency wrote that their ability "to derive a credible assessment . . . would benefit greatly from the provision of additional information, including from the provider of the weapons design."
The agency also noted that Pakistan has refused to allow its inspectors to take samples at Pakistani laboratories that could help confirm where Libya and Iran got their nuclear materials. Instead, the Pakistanis have insisted on conducting their own tests, without outside observers, and then sharing data with the IAEA.
"This investigation is continuing but can only be completed if the agency is permitted to take independent swipe samples at locations where the enriched uranium contamination may have originated."

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? 2004 The Washington Post Company
Israel, Iran Trade Threats As FBI Investigates Spying
U.S. Ally Said to Have Received Documents on Tehran
By Molly Moore and John Ward Anderson
Washington Post Foreign Service
Monday, August 30, 2004; Page A18
JERUSALEM, Aug. 29 -- Israel and Iran traded significantly escalated threats of military attacks in recent months as the FBI investigated allegations that a Pentagon official passed secret U.S. policy information about Iran to Israeli authorities.
Israel has warned that it could launch strikes against Iranian nuclear facilities to thwart the country's advancing weapons program. In response, Iranian Gen. Yahya Rahim Safavi, commander of the Revolutionary Guards, said earlier this month: "If Israel should dare to attack our nuclear installations, we will come down on its head like a heavy hammer crushing its skull."
Since the U.S. invasion of Iraq, Israeli officials have expressed more concern about the danger Iran poses and have been more emboldened in their threats to quash it. But the espionage allegations, which surfaced Friday, prompted a wave of vehement denials, political angst and disbelief among Israeli officials, intelligence experts, diplomats and other political analysts.
"It's hard to see this as such an issue of controversy or disagreement that Israel would say, 'Break all the rules because we have to find out what they're doing,' " said Yossi Alpher, a former official in the Mossad, Israel's intelligence agency.
The FBI is investigating whether Lawrence A. Franklin, a career analyst at the Defense Intelligence Agency who specializes in Iran, gave classified information to two lobbyists for the American Israel Public Affairs Committee, known as AIPAC, according to sources. U.S. officials said the information, which included the draft of a presidential directive on U.S. policies toward Iran, was then given to Israeli officials. AIPAC has denied any wrongdoing and said its employees were cooperating with the inquiry.
Newsweek magazine reported on its Web site Sunday that FBI agents had monitored a conversation between an Israeli Embassy official and an AIPAC lobbyist at lunch nearly 18 months ago. Another American, later identified as Franklin, "walked in" during the session, according to the report. At the time the FBI was looking into possible Israeli espionage, Newsweek said.
The investigation is the second in recent months involving allegations of Israeli espionage against an ally. In July, a New Zealand court found two Israeli men, accused of being agents for the Mossad, guilty of attempting to forge New Zealand passports. Israeli officials denied that the men were members of the Mossad, but New Zealand's prime minister announced diplomatic sanctions against Israel and demanded an apology.
Michael Oren, an Israeli historian, said Israel would have very little to gain by spying on the United States "because the relationship is so open and giving."
"Israel and the United States see very much eye to eye on the Iran threat, and the intelligence cooperation is extremely close -- it's on an unprecedented level," Oren said. "Both countries perceive Iran's future acquisition of nuclear weapons as a grave threat to the region and the world, and both are committed to trying to prevent Iran from going nuclear."
For months, Israeli officials, including Defense Minister Shaul Mofaz, have warned Iran that Israel was prepared to take what Mofaz called "the necessary steps" to eliminate its nuclear capability. In 1981, Israeli bombers destroyed Iraq's Osirak nuclear reactor in an effort to curtail then-President Saddam Hussein's nuclear weapons program.
In recent weeks, Israel and Iran have stepped up their rhetoric. Iranian Defense Minister Ali Shamkhani told al-Jazeera Arab television network this month that "Iran is not Iraq -- we will not sit by idly if our nuclear reactor's installations are attacked."
Israeli defense and intelligence officials have said Iran's nuclear weapons development program, coupled with its Shihab-3 missile, which is capable of striking Israel, represent the most significant threat to Israel.
In a simulated test last Friday off the Californian coast, Israel's Arrow anti-ballistic missile system, which is designed to destroy or intercept short- and medium-range missiles, failed to stop a Shihab-3 and a Syrian Scud D, according to Israeli defense officials.
Analysts also said that because of AIPAC's alleged involvement, the Franklin case, if proved, could have a more damaging impact on U.S.-Israeli relations than the case of Jonathan J. Pollard, a U.S. Navy intelligence analyst who admitted to spying for Israel in 1987. Analysts said the case could also have a major impact on AIPAC. The group has 65,000 members "at the forefront of the most vexing issues facing Israel today: stopping Iran from acquiring nuclear weapons, fighting terrorism and achieving peace," according to its Web site.
"The insinuation that AIPAC, an American Jewish lobby, is engaged in espionage is in some ways worse than Pollard, who as a single individual could be described as off-balance," said Alpher, the former Mossad official.
Equally damaging could be the perception that Israeli and American Jews are wielding disproportionate influence on U.S. foreign policy, said Oren, the historian.
"There's a convention going on in New York," he said, referring to the Republican National Convention, "and the canard has been out there for a long time that Israel and Israel's supporters and the neo-conservatives in the Defense Department have manipulated U.S. foreign policy, especially on Iraq, to serve Israeli purposes, and this would tend to substantiate that canard."
? 2004 The Washington Post Company
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The Kerry Doctrine
By Robert Kagan
Sunday, August 1, 2004; Page B07
Someday, when the passions of this election have subsided, historians and analysts of American foreign policy may fasten on a remarkable passage in John Kerry's nomination speech. "As president," Kerry declared, "I will bring back this nation's time-honored tradition: The United States of America never goes to war because we want to; we only go to war because we have to. That is the standard of our nation." The statement received thunderous applause at the convention and, no doubt, the nodding approval of many Americans of all political leanings who watched on television.
Only American diplomatic historians may have contemplated suicide as they reflected on their failure to have the smallest influence on Americans' understanding of their own nation's history. And perhaps foreign audiences tuning in may have paused in their exultation over a possible Kerry victory in November to reflect with wonder on the incurable self-righteousness and nationalist innocence the Democratic candidate displayed. Who but an American politician, they might ask, could look back across the past 200 years and insist that the United States had never gone to war except when it "had to"?
The United States has sent forces into combat dozens of times over the past century and a half, and only twice, in World War II and in Afghanistan, has it arguably done so because it "had to." It certainly did not "have to" go to war against Spain in 1898 (or Mexico in 1846.) It did not "have to" send the Marines to Cuba, Haiti, the Dominican Republic, Mexico and Nicaragua in the first three decades of the 20th century, nor fight a lengthy war against insurgents in the Philippines. The necessity of Woodrow Wilson's intervention in World War I remains a hot topic for debate among historians.
And what about the war Kerry himself fought in? Kerry cannot believe the Vietnam War was part of his alleged "time-honored tradition," or he would not have thrown his ribbons away. But America's other Cold War interventions in Asia, Latin America and the Middle East are also problematic. Most opponents of the Vietnam War, like Kerry, believed it was symptomatic of a larger failure of U.S. foreign policy stemming from what Jimmy Carter memorably called Americans' "inordinate fear of communism." The other Cold War interventions were premised on the same "misguided" anti-communism and the concomitant democratic idealism, that pulled Kerry's hero, John F. Kennedy, into Vietnam. The United States, by this reckoning, did not "have to" go to war in Korea in 1950. Nor could a post-Vietnam Kerry have considered Lyndon Johnson's 1965 intervention in the Dominican Republic necessary. Or has Kerry now retroactively accepted the Cold War justification for these interventions that he once rejected?
Then there were the wars of the post-Cold War 1990s. The United States did not "have to" go to war to drive Saddam Hussein from Kuwait. No one knows that better than Kerry, who voted against the Persian Gulf War, despite its unanimous approval by the U.N. Security Council. Nor could anyone plausibly deny that the Clinton administration's interventions in Haiti, Bosnia and Kosovo were wars of choice. President Bill Clinton made the right choice in all three cases, but it was a choice.
Why is Kerry invoking an American "tradition" that does not exist?
Perhaps he's distorting American history simply to cast the Bush administration and the war in Iraq in the harshest possible light. But maybe Kerry is not being cynical. Perhaps, finally, he is saying what he really believes and not what American policy has been, but what it should be.
The doctrine Kerry enunciated on Thursday night, after all, was the doctrine initially favored by the antiwar movement and the mainstream of the Democratic Party after the debacle of Vietnam. "Come home, America" was the cry of those who believed America had corrupted both the world and itself in "wars of choice" in Vietnam and elsewhere.
Advocates of this doctrine did not propose a "return" to some mythical American past. Rather, they proposed a radical departure onto a very different course in American foreign policy. Their goal was a retraction of American power and influence from around the globe. Nor did they have any doubt that their view of America was patriotic. They would cleanse America of its sins.
Would it really be surprising if John Kerry, whose life and thought were so powerfully shaped by his Vietnam experience, now returned to the view of American foreign policy which that experience led him to three decades ago? There seems to be a conspiracy on both sides in this campaign not to take Kerry seriously as a man of ideas and conviction. But the fact that he has waffled so visibly on Iraq may be the best proof of his commitment to the beliefs about American foreign policy he came to hold in the 1970s.
Maybe Kerry's real act of cynicism was his vote for the Iraq war in the fall of 2002. With that vote, he ignored everything he believed he had learned from his Vietnam experience. In retrospect, he may feel that he sold his soul to make himself electable. In the months since the war, Kerry has had to pretend he did the right thing, not only because a politician dare not admit error but because his political advisers believe that in a post-Sept. 11 world most of the electorate does not want an "antiwar" president. Throughout the long months of the campaign, Kerry disciplined himself to sound like a hawk. But in his heart, based on all he learned during the formative years of his life, Kerry is not a hawk. At the Democratic National Convention, John Edwards followed the script. Kerry followed his heart.
The ironies abound. Three decades ago, Kerry came out in opposition to the war he had fought in Vietnam. Today, Kerry extols that service so that he may safely, patriotically distance himself from the war in Iraq that he had supported.
If Kerry has revealed himself in an unusual moment of honesty, it's time everyone took an equally honest look at where he would lead the country if elected. Kerry's "doctrine of necessity," if seriously intended, would entail a pacifism and an isolationism more thorough than any attempted by a U.S. government since the 1930s. It would rule out all wars fought for humanitarian ends, all interventions to prevent genocide, to defend democracy or even, as in the case of the Persian Gulf War, to uphold international law against aggression. For those are all wars of choice.
For someone who professes to seek better relations with the rest of the world, Kerry's doctrine of necessity would base American foreign policy on narrow, selfish interests far more than the alleged "unilateralism" of the Bush administration. Some Europeans have been quietly worrying that what they consider Bush's overambitious foreign policy will be followed in the United States by an isolationist backlash. After hearing Kerry's speech, they may worry a bit more.
Robert Kagan, a senior associate at the Carnegie Endowment for International Peace, writes a monthly column for The Post.
? 2004 The Washington Post Company

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>> BANG THE DRUM...



Edwards Says Kerry Plans to Confront Iran on Weapons
By Glenn Kessler and Robin Wright
Washington Post Staff Writers
Monday, August 30, 2004; Page A01
A John F. Kerry administration would propose to Iran that the Islamic state be allowed to keep its nuclear power plants in exchange for giving up the right to retain the nuclear fuel that could be used for bomb-making, Democratic vice presidential nominee John Edwards said in an interview yesterday.
Edwards said that if Iran failed to take what he called a "great bargain," it would essentially confirm that it is building nuclear weapons under the cover of a supposedly peaceful nuclear power initiative. He said that, if elected, Kerry would ensure that European allies were prepared to join the United States in levying heavy sanctions if Iran rejected the proposal. "If we are engaging with Iranians in an effort to reach this great bargain and if in fact this is a bluff that they are trying to develop nuclear weapons capability, then we know that our European friends will stand with us," Edwards said.
Edwards's notion of proposing such a bargain with Iran, combined with Kerry's statement in December that he was prepared to explore "areas of mutual interest" with Iran, suggests that Kerry would take a sharply different approach with Iran than has President Bush. The United States has not had diplomatic relations with Iran since its 1979 revolution, and Iran was part of Bush's "axis of evil" that included North Korea and the former government of Iraq. Earlier this month, Bush declared that Iran "must abandon her nuclear ambitions."
Edwards will deliver a speech today in Wilmington, N.C., that aides said will seek to sharpen the differences with the Bush administration on a range of foreign policy issues. Seizing on Bush's statement last week that he miscalculated the postwar conditions in Iraq, Edwards will lay out a broad indictment of how he believes the administration has miscalculated on Iraq, overseas alliances, Afghanistan and other issues.
Edwards, interviewed yesterday in the living room of his Georgetown townhouse as he sipped a Diet Coke, said that in Afghanistan, Kerry would push to expand NATO forces beyond Kabul to enhance security and would double the $123 million in funds to counter the drug trade that the administration spent in 2004 in Afghanistan. He said that despite the problems NATO has had in meeting its commitment in Afghanistan, Kerry would push NATO to add troops there and perhaps military equipment, but that the U.S. force of 20,000 would not be expanded.
"NATO has made promises that have not been kept by some of the NATO countries in getting the equipment -- helicopters, etc. -- that are needed there," Edwards said. "But we believe that with a president who treats NATO and the NATO countries the way they should be treated, and with a fresh start, we have a real chance of getting NATO more involved."
Edwards also said the Democrats would be able to obtain greater NATO involvement in Iraq for the same reason, even though NATO officials have said it will be difficult for the organization to undertake a major mission in Iraq until its work in Afghanistan is completed.
On Iran, Edwards accused the Bush administration of abdicating responsibility for the Iranian nuclear threat to the Europeans, who have maintained relations with Tehran and in the past years have tried to broker a deal that would end its nuclear enrichment program. "A nuclear Iran is unacceptable for so many reasons, including the possibility that it creates a gateway and the need for other countries in the region to develop nuclear capability -- Saudi Arabia, Egypt, potentially others," Edwards said.
Kerry first outlined the idea of providing nuclear fuel to Iran in a speech in June -- a proposal favored by many Europeans -- but Edwards, who twice described the concept as a "bargain," was more explicit in suggesting the Kerry administration would actively try to reach an agreement with the Iranians. "At the end of the day, we have to have some serious negotiating leverage in this discussion with the Iranians," he said, noting that Kerry would press the Europeans to do much more than "taking rewards away" if the Iranians fail to act.
Iran has insisted that it be allowed to produce nuclear fuel, which would give it access to weapons-grade material. Under Kerry's proposal, the Iranian fuel supply would be supervised and provided by other countries.
Experts on Iran have long speculated that some sort of "grand bargain" that would cover the nuclear programs, a lifting of sanctions and renewed relations with the United States would help solve the impasse between the two countries. But campaign aides later said Edwards was not suggesting an agreement that covered more than the nuclear programs. In the December speech, Kerry criticized Bush for failing to "conduct a realistic, nonconfrontational policy with Iran."
Despite its oil reserves, Iran has long sought nuclear energy to provide future energy for a burgeoning population, which has doubled since 1979. But Tehran, during the monarchy and under the current theocratic rulers, is also seeking nuclear energy as a key to development in the 21st century.
Shah Mohammed Reza Pahlavi, Iran's last monarch, had plans -- approved by the United States -- to build more than 20 nuclear reactors. Iran is currently building one plant at Bushehr, a long-delayed project started during Pahlavi's reign with help from Germany. Russia took over the development contract after the revolution. Iran said this month that it plans to build a second at an unspecified location because of growing drains on its other resources.
The United States has long suspected that Iran wants to develop a nuclear capability to be able to make nuclear arms, and the Bush administration has pressed the International Atomic Energy Agency to confront Iran over its failure to fully disclose its activities. But reformists and hardliners in Tehran insist that Iran will continue developing a nuclear energy capacity, an issue that has become a symbol of national pride.
"At the end of the day [Bush officials] can argue all they want about their policies," Edwards said. "But the test is: Have they worked? And Iran is further along in developing a nuclear weapon than they were when George Bush came into office."
? 2004 The Washington Post Company


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N. Korea, Libya in Possible Nuclear Link
By GEORGE JAHN
The Associated Press
Monday, August 30, 2004; 5:36 PM
VIENNA, Austria - Some nuclear technology ordered by Libya for its former weapons program is missing, while the origin of other material is unclear, the U.N. nuclear watchdog said Monday, raising concerns about where the equipment is and whether North Korea could have been a provider.
The IAEA findings on Libya's now dismantled nuclear weapons program were circulated to diplomats in a confidential report obtained by The Associated Press ahead of a meeting of the agency's board of governors. That meeting, which starts Sept. 13, will review the progress of IAEA investigations into secret nuclear activities by Libya and Iran.
The Iran report is expected to be released to diplomats in the next few days. While Iran denies accusations by the United States and others that its nuclear program is geared toward making weapons, Libya went public about its weapons programs in December and pledged to scrap them.
In the report Monday, the agency credited Libya with cooperation in efforts to get to the bottom of its activities, but said some questions remained.
Among them was the issue of some "enrichment technology" that was missing after Libya ordered but never received it.
The report also said the origin of two cylinders of uranium hexaflouride remains unknown. The material is introduced into centrifuges and spun to enrich it. Uranium enriched to 90 percent or above is considered weapons grade and is used in the manufacture of warheads.
The report confirmed that uranium hexaflouride was bought in 2000 "from a foreign supplier," but came to no conclusion of where the substance originated from.
A senior diplomat familiar with the Libyan investigation said the agency remained uncertain about whether the uranium hexaflouride was purchased on the black market from Pakistan or North Korea.
While Pakistan was the source of much of the enrichment technology peddled by the black market network of Pakistani scientist Abdul Qadeer Khan, North Korea has also been mentioned previously by experts and diplomats as a possible source for Libya's uranium hexaflouride.
North Korea admitted in 2002 to running a secret nuclear program in violation of international agreements. The isolated communist nation subsequently broke all agreements with the IAEA that had allowed outside monitoring of some of its programs.
On the missing equipment, the report said investigations continue on enrichment technology "destined for Libya ... (that) never arrived." It did not say what the material was.
The diplomat, who spoke on condition of anonymity, said the investigations focused on whether the equipment "ended up in the hands of another country or it's sitting on a dock somewhere and was never shipped."
"This is one of the big questions," said the diplomat. "Where did the other stuff go?"
While the agency has not found any indications that weapons-related technology has been sold by the nuclear network to terrorists, another diplomat said nothing could be discounted until all shipments sold on the black market had been accounted for.
The report also noted Libya's assertion that it never acted to develop a nuclear warhead based on blueprints found in its possession.
But the report suggested the agency could not test that claim until "the provider of the weapon design" and contractors who helped Libya develop its nuclear technology came forward with more information. Diplomats and experts have said the blueprints are of Chinese design and sold by the Khan network
The senior diplomat said that, without such help, the agency cannot tell if the blueprints were passed on to others interested in developing a clandestine weapons program.
On the Net:
International Atomic Energy Agency: www.iaea.org
? 2004 The Associated Press

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U.N. Can't Define Libya Weapons Program
By GEORGE JAHN
The Associated Press
Monday, August 30, 2004; 11:33 AM
VIENNA, Austria - The U.N. nuclear watchdog agency failed Monday to make a judgment on the origin of some technology for Libya's weapons program, a finding that diplomats said kept alive concerns of North Korean involvement.
In a restricted report the International Atomic Energy Agency also said that some of the equipment ordered by Libya as part of its program remains missing, raising concerns that other countries or groups might have secretly received it.
The IAEA report was made available to The Associated Press shortly after the agency began circulating it to diplomats ahead of a meeting of the agency's board of governors starting Sept. 13 that will review the progress of investigating secret nuclear activities by Libya and Iran.
The Iran report is expected to be released to diplomats in the next few days. While Iran denies accusations by the United States and others that its nuclear program is geared toward making weapons, Libya went public about its weapons programs in December and pledged then to scrap them.
In the report being circulated Monday, the agency credited Libya with cooperation in efforts to get to the bottom of its activities but said some questions remained outstanding.
Among them, the report focused on the origin of two cylinders of uranium hexaflouride, which is introduced into centrifuges and spun to enrich it. Uranium enriched to 90 percent or above is known as weapons grade, and is used in the manufacture of warheads.
The report confirmed that uranium hexaflouride was bought in 2000 "from a foreign supplier" but made no conclusion of where the substance originated from.
A senior diplomat familiar with the Libyan investigation said that indicated that the agency remained uncertain about whether the uranium hexaflouride was purchased on the black market from Pakistan or North Korea.
While Pakistan was the source of much of the enrichment technology peddled by the black market network of Pakistani scientist Abdul Qadeer Khan, both Pakistan and North Korea have been mentioned by experts as possible sources of origin for the uranium hexaflouride found in Libya.
"If it's North Korea, its obviously disturbing," said the diplomat, who spoke on condition of anonymity. "That means that North Korea was a member of the proliferator group, and so far we only knew of ... Pakistan."
North Korea admitted in 2002 to running a secret nuclear program in violation of international agreements. The isolated communist nation subsequently broke all agreements with the IAEA that had allowed outside monitoring of some of its programs.
On the missing equipment, the report said investigations continue on enrichment technology "destined for Libya ... (that) never arrived."
The diplomat said the investigations focused on whether the equipment "ended up in the hands of another country or its sitting on a dock somewhere and was never shipped."
"This is one of the big questions," said the diplomat. "Where did the other stuff go."
While the agency has not found any indications that weapons-related technology has been sold by the nuclear network to terrorists, another diplomat said nothing could be discounted until all shipments sold on the black market had been accounted for.
? 2004 The Associated Press
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>> REPEAT CONDI WATCH


Libya talks oil/gas investment with ChevronTexaco
SPECIAL TO WORLD TRIBUNE.COM
Wednesday, August 25, 2004
Libya has resumed talks with ChevronTexaco for the resumption of investment in the energy sector of the North African state.
Executives said a ChevronTexaco delegation met Libyan officials in Tripoli several times during 2004 to discuss investment in Libya's crude oil and natural gas sector. The talks were enabled by the lifting of U.S. sanctions by President George Bush more than six months ago.
Chevron operated in Libya throughout the 1960s and 1970s until its joint venture operations with Texaco were taken over by a unit of Libya's National Oil Corp. about 25 years ago, Middle East Newsline reported. Other U.S. companies that operated in Libya until the imposition of U.S. sanctions in 1986 also resumed efforts to return to Libya.
So far, none of the U.S. companies have signed an agreement with Libya.
Industry sources said Libya has also been negotiating with such European energy contractors as Anglo-Dutch Royal Dutch/Shell Group, which announced an oil and natural gas partnership in March.
Copyright ? 2004 East West Services, Inc.

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Used to working behind the scenes,
AIPAC suddenly thrust into limelight
By Matthew E. Berger
NEW YORK, Aug. 30 (JTA) -- In its outreach to potential supporters and to the media, the American Israel Public Affairs Committee touts its access to the highest levels of government.
Now it's that very access that has thrust the pro-Israel lobby, accustomed to working behind the scenes, into the limelight.
Accusations that AIPAC officials received classified information from a Pentagon staffer and forwarded it on to Israel broke on the eve of this week's Republican National Convention in New York, where AIPAC is hosting several policy forums for Republican contributors.
According to media accounts, a non-Jewish officer on the Iranian desk at the Pentagon, Larry Franklin, is being investigated for passing at least one classified document to AIPAC officials, which may then have been forwarded to Israeli officials in Washington.
Reports have suggested that Franklin could face charges ranging from espionage to the mishandling of classified information.
The Jerusalem Post reported that the AIPAC officials involved were Steven Rosen and Keith Weissman, and that they have spoken to federal investigators.
Rosen is AIPAC's director of research and considered one of the most influential people in the organization. He has been with AIPAC since 1982, and mentored both Howard Kohr, AIPAC's current executive director, and Martin Indyk, the former U.S. ambassador to Israel.
Weissman is deputy director of foreign policy issues and specializes in relations with Iran, Syria and Turkey.
AIPAC would not confirm or deny the reports.
New reports also suggested that Naor Gilon, minister of political affairs of the Israeli embassy in Washington, was the subject of an FBI investigation on suspicion of espionage for Israel when Franklin came to the investigators' attention more than a year ago.
Both Israel and AIPAC deny any impropriety in the case. Many U.S. Jews believe, or hope, that no charges will be filed and that the issue will fade from the headlines in coming days.
But the charges, and their prominent play in the media, have reopened questions about the way AIPAC does business with the U.S. and Israeli governments.
AIPAC's grassroots advocacy and political lobbying departments get most of the attention, but the organization also has a thriving think tank that works to influence Middle East policy at the highest levels of government.
To those who work with AIPAC in Washington, or have worked for the organization itself, the idea of information being passed from government officials to AIPAC staffers to Israelis seems almost commonplace.
After all, these people see each other on almost a daily basis, at think-tank lunches and policy meetings throughout the capital. Information is exchanged and each participant tries to show his importance by touting what he knows and whom he has access to.
"The easiest thing to learn in Washington is that no one likes to be surprised," said Jon Alterman, a former State Department official. "AIPAC doesn't like to be surprised and nobody wants to surprise AIPAC."
In that sense, AIPAC is like any other policy organization in Washington.
"Information is the currency in Washington," said Morris Amitay, AIPAC's executive director from 1974 to 1980. "AIPAC meets regularly with officials at the State Department and Defense Department, trying to find out what's going on."
It's unclear how much of the information AIPAC receives is forwarded to Israeli officials, but the coordination between the Jewish state and its advocates in Washington is considerable.
Most Israeli officials who travel to Washington meet with AIPAC and exchange information. But Israeli officials also have strong ties to the Bush administration, and receive much information directly from American governmental sources, without need of intermediaries.
One congressional staffer said it was understood in Washington that AIPAC had access to the highest sources in both the U.S. and Israeli governments, and could get most information it wanted.
"They are very astute at knowing who will know what they would like to find out," said the staffer, who spoke on condition of anonymity because the FBI investigation is ongoing. "It's simply understood, based on the success they've had."
But because of the issues AIPAC deals with, policy discussions can easily cross into areas of national security, increasing the chances that classified information will be passed.
"There's always a real possibility that in giving a briefing, certain information that is classified could come out by the government briefers," said Neal Sher, who served as AIPAC's executive director from 1994 to 1996 and formerly worked in the U.S. Justice Department. "The lines are real blurry."
But Sher said the briefer would be the one committing the illegal act, not the one who gets the information.
"Anyone with half a brain, if someone is giving you a classified document, would say, `I don't want to look at it,' " Amitay said. "Because it could be a sting."
According to Newsweek, that's what occurred in the current case. Franklin reportedly tried to give documents to an AIPAC staffer, who wouldn't take them but asked for the information to be summarized orally.
When it comes to documents, federal officials with security clearances are given little leniency. Most desks have two computers; one for classified material and one for unclassified. The e-mail systems are separate and diskettes are not allowed to be inserted into the classified system.
But there's a lot more leeway when government officials brief outsiders.
"How far you go in telling people what's going on in a classified environment is a decision you have to make every day," Alterman said. "There is a perception that you can trust the people you're talking to."
The congressional staffer added that much of what is classified already has been reported by the media.
The recent focus on AIPAC's business practices is counter to the way the organization likes to work. AIPAC likes to shift focus away from its own professionals and onto the lay leaders and lawmakers publicly expressing support for the Jewish state.
But that hasn't always been easy. Because Israel is such a heated topic in Washington and around the world, and because AIPAC has been successful in its mission, the group often is at the center of questions regarding U.S. support for Israel.
? JTA. Reproduction of material without written permission is strictly prohibited.

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Pakistan Losing Grip on Extremists
Attacks on Officials Linked to Al Qaeda
By John Lancaster and Kamran Khan
Washington Post Foreign Service
Sunday, August 29, 2004; Page A01
ISLAMABAD, Pakistan -- A recent series of assassination attempts on high-level officials here is the result of a growing and deadly alliance between Pakistani extremists and second-rung al Qaeda operatives from Arab countries and Central Asia who use the border area with Afghanistan as a refuge, according to senior Pakistani intelligence sources.
The development is a disquieting one, foreign diplomats said, because it suggests that Pakistan's security services may be losing control over home-grown militants they once embraced as allies, first in the struggle against the Soviets in Afghanistan and more recently against Indian forces in Kashmir.
An attack on Lt. Gen. Ahsan Saleem Hayat, a top military commander, on June 10 was conducted by Pakistani assailants who later confessed they had been trained in small arms, explosives and conducting ambushes at an al Qaeda camp in Pakistan's rugged tribal region of South Waziristan, near the Afghan border, according to two senior intelligence officials.
The gunmen identified their instructors as Uzbeks and Arabs.
The Pakistani extremists, disguised in military-style uniforms, attacked Hayat as they waited in a stolen van in the port city of Karachi near a bridge frequented by military officials, then opened up with machine guns on his motorcade.
Hayat survived the carefully planned ambush, but 11 others were killed, including his driver. The assailants were quickly identified and rounded up, traced through a cell phone left at the scene, authorities said.
Pakistani officials said they believed that foreign al Qaeda operatives working with Pakistani militants were also behind two attempts to kill Gen. Pervez Musharraf, Pakistan's president, in December.
The same combination, they said, may have carried out the July 30 assassination attempt against Shaukat Aziz, then the finance minister, who became prime minister on Saturday.
"For a foreigner to operate in Pakistan has become more and more difficult, so obviously their effort is to use local operatives," said one of the senior intelligence officials, who spoke on condition that neither he nor his organization be identified.
On Monday, government troops killed four foreign fighters and wounded several others in a shootout in a remote tribal section on the Afghan border, authorities said. On Aug. 21, authorities announced the arrest of up to 10 al Qaeda suspects, including Pakistanis and two Egyptians, after breaking up what they said was a plot to launch attacks against the U.S. Embassy and Musharraf's residence, among other targets.
The decision to apply stronger pressure on militants poses a delicate challenge for Musharraf, who is eager to confront the domestic terrorist threat and has recently won international praise following a series of high-profile al Qaeda arrests in Pakistan in June and July.
At the same time, Musharraf is reluctant to challenge extremist groups he still regards as potential levers in the conflict with India over control of Kashmir, even though the groups theoretically have been banned, analysts said.
In an interview with a Pakistani newspaper this month, Musharraf said the groups would not "pack up" until India and Pakistan reached a settlement on Kashmir, which Pakistan regards as the key issue in peace negotiations between the nuclear-armed neighbors.
"What he's saying is, 'If there's movement on Kashmir, it will strengthen my hand to move even more strongly against these people,' " the senior intelligence official said.
Musharraf's allies are losing patience with that argument. During a trip to the region last month, Deputy Secretary of State Richard Armitage publicly called on Pakistan to act more forcefully against the homegrown groups. One foreign diplomat cited reports that fighters from Lashkar-e-Taiba, one of Pakistan's best known banned militant organizations, had traveled to Iraq in recent months to join other foreigners battling U.S. and Iraqi government forces.
"We have received these reports, and we take them very seriously because we do know there were efforts to take some Pakistanis into Iraq," said the senior intelligence official. But the official said it was unclear whether the efforts succeeded.
The official also asserted that Musharraf had limited room to maneuver against domestic extremists, given the depth of public anger over U.S. policy in the Middle East. "I think the time has come for others to do more for Pakistan than for Pakistan to do more," said the official. "I think our commitment on terrorism is absolutely unparalleled, and it needs to be acknowledged."
On Dec. 25, Musharraf's high-wire act nearly cost him his life when two suicide bombers drove explosives-laden vehicles into his motorcade in the city of Rawalpindi, where he lives, killing 19 people but leaving the president unharmed. One of the bombers was later identified as a member of a breakaway faction of Jaish-e-Mohammed, one of the main militant groups battling Indian forces in Kashmir. The group was founded with the government's blessing in 2000 by Masood Azhar, a radical cleric.
"Jihadists like Masood Azhar were then the natural allies of Musharraf, hence the ultimate freedom to propagate and recruit jihadis under state patronage," said a former army chief of staff who spoke on condition of anonymity. Azhar may now oppose Musharraf, "but there will be a price," the former official said.
Jaish-e-Mohammed has also been linked to the attack on Aziz, the new prime minister. Investigators have identified the prime suspect in the case as Qari Ahsan, who lived in the same southern Punjab town as Azhar and was considered one of his top lieutenants, intelligence officials said. Azhar has disappeared from view; a senior intelligence official described him as a fugitive.
But the official said it would be a mistake to conclude that Jaish-e-Mohammed and other such organizations had actively turned against the government. "The leadership was under pressure from the government, so you find everyone splintering into small cells acting on their own," he explained.
The official also asserted that as a consequence of Pakistan's counterterrorism efforts, including a series of army operations in South Waziristan this year, the ability of al Qaeda -- and especially its senior leaders, Osama bin Laden and Ayman Zawahri -- to direct attacks had been "very severely curtailed."
At the same time, the official said, "there is probably a second or third tier that has started asserting itself operationally."
A leading example is a Libyan citizen, Abu Faraj Libbi, whom Pakistani authorities accuse of coordinating the December attempts on Musharraf's life. The senior official said it was "quite likely" that Libbi also had a hand in the attempt on Aziz, whose driver was killed in the bombing, although other investigators described the connection as speculative. The official said that Libbi was believed to be directing terrorist operations both in Pakistan and elsewhere from a hideout in South Waziristan.
Pakistani newspapers have run ads offering rewards of up to $345,000 each for information leading to the capture of Libbi and five Pakistanis, including Ahsan, the former Jaish-e-Mohammed lieutenant sought in connection with last month's attempt on Aziz.
The June attack on Hayat, who commands one of Pakistan's nine army corps, has been blamed on a previously unknown group called Jundullah. Its alleged leader, Ataur Rehman, holds a master's degree in statistics from Karachi University and fought with the Taliban when it enjoyed the backing of Pakistan's government during the Afghan civil war of the 1990s, investigators said.
Although officials have not specifically linked that episode to the Libyan, they said that two of the gunmen had admitted spending four weeks under al Qaeda's tutelage at a mud-walled compound in the Shakai Valley of South Waziristan. The compound was one of several destroyed in a major military assault in May.
Khan reported from Karachi.
? 2004 The Washington Post Company


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The Real Test for Chavez Starts Now

By Marcela Sanchez
Special to washingtonpost.com
Thursday, August 26, 2004; 10:30 PM
WASHINGTON -- Most Venezuelan voters believe that President Hugo Chavez cares about them.
According to U.S. pollsters, this is the simple but powerful sentiment that carried Chavez to victory in the Aug. 15 recall referendum as well as the six other elections he and his political movement have faced in the last six years. For the opposition, the hardest thing about losing is sometimes admitting that the winner was right about something. Sadly, Chavez's antics and destructive rhetoric continue to obscure this kernel of truth.
The real measure of Chavez's presidency now becomes his commitment to Venezuela's poor. His challenge will be to make his misiones, the welfare programs that bring food, health and education to the barrios, sustainable in the long run. Many observers in Washington and in Venezuela who have long been critical of Chavez, are betting he will fail.
To Chavez's credit, no other country in South America has brought primary health care to so many neglected people in as short a time as Venezuela has, according to Renato Gusmao, the Pan-American Health Organization representative in the region. But Chavez has failed to make this a Venezuelan commitment. The backbone of the program is the 13,000 Cuban doctors now working in the country.
A program that relies on foreign doctors and good relations with Cuba is not a good model for long-term success. But such are the methods Chavez employs.
The Venezuelan leader is able to fund his social programs thanks to record-high oil prices and the fact that his country is the fifth-largest oil producer in the world. Despite his rhetoric against the United States and free markets, Chavez has made sure that oil interests are well cared for in his country.
Chavez has done little to diversify the engines of Venezuelan economy. In the hemisphere, Venezuela ranks only above Haiti in deregulating and reducing bureaucratic processes to facilitate starting or running a business, according to the World Bank's Doing Business Project. This is very significant considering that 57 percent of the work force in Latin America is employed by micro, small or medium-size enterprises.
Chavez has further handicapped his own economy by removing the middlemen, utilizing the armed forces to ensure the effective distribution of subsidized foods or health services. The products and services are delivered but at the cost of jobs that might provide new opportunities for the poor. Chavez was right that middlemen were gouging the poor, but what was needed then was a government that would promote competition rather than usurp all responsibility.
The net effect of eliminating competition and maintaining a high reliance on a near single source of national income -- oil represents 80 percent of export revenues -- is the consolidation of economic power. On top of that are Chavez's efforts to concentrate political power. What he doesn't seem to get is that sooner or later, power will be passed on to someone whose interests may not lie with the poor.
In his first six years in office, Chavez never stopped campaigning. Now it's time for him to finally recognize what he never could as a candidate: he cannot pretend to govern on behalf of the poor while fully ignoring the wealthy. Divisive rhetoric works for campaigning, but once in power, representing the interests of one group while ignoring the rest is self-destructive. Just ask Chavez's predecessors.
If Chavez is ever to dispel the many doubts about his democratic credentials and his ability as a leader, he must accept some realities over the next two years. To be serious about making his revolution for the underclass something more than a wild experiment of an astute campaigner, he must recognize that unless he changes his methods, he could end up hurting the poor.
If that were to happen, the disappointment of Venezuelans who for too long have lived in despair in an oil-rich land but now have had a taste of that wealth, could lead to unknown consequences. For Chavez, the challenge is to align his methods with a long-term solution.
The challenge for the opposition is to recover as a real political force. One way to achieve that is to accept as legitimate Chavez's intention to help the poor and aid him or question him in the process.
Marcela Sanchez's e-mail address is desdewash@washpost.com.
? 2004 The Washington Post Company


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La verdadera prueba de Chavez empieza ahora
By Por Marcela Sanchez
Especial para washingtonpost.com
Thursday, August 26, 2004; 10:30 PM
La mayor?a de los venezolanos creen que el Presidente Hugo Ch?vez se preocupa por ellos.
De acuerdo con encuestadores estadounidenses, ese es el sentimiento simple pero poderoso que llev? a Ch?vez a la victoria en el referendo revocatorio del 15 de agosto, al igual que en las otras seis elecciones que ?l y su movimiento pol?tico han enfrentado en los ?ltimos seis a?os. Para la oposici?n, lo m?s dif?cil de perder a veces es admitir que el ganador puede tener algo de raz?n. Tristemente, las extravagancias y la ret?rica destructiva de Ch?vez contin?an ocultado ese grano de verdad a la oposici?n.
La prueba de oro de la presidencia Ch?vez ahora es su compromiso con los pobres en Venezuela. Su reto ser? hacer sostenibles a largo plazo sus misiones de asistencia social, que han llevado alimentos, salud y educaci?n a los barrios de Venezuela. Muchos observadores en Washington y Venezuela que han sido por mucho tiempo cr?ticos de Ch?vez, est?n apostando que fracasar?.
Hay que darle cr?dito a Ch?vez ya que ning?n otro pa?s en la regi?n ha llevado servicios de salud comunitaria a tantas personas marginadas en tan corto plazo como lo ha hecho Venezuela, seg?n Renato Gusmao, el representante de la Organizaci?n Panamericana de la Salud en la naci?n sudamericana. Pero Ch?vez ha fracasado en hacer que toda Venezuela est? comprometida con ese programa. La espina dorsal del plan son 13.000 galenos cubanos que trabajan ahora en el pa?s.
Un programa que depende de m?dicos extranjeros y buenas relaciones con Cuba, no es un buen modelo de ?xito a largo plazo. Pero esos son los m?todos que Ch?vez emplea.
El mandatario venezolano es capaz de financiar sus programas sociales gracias a precios r?cord de petr?leo y al hecho de que su pa?s es el quinto productor mundial del hidrocarburo. A pesar de su ret?rica contra Estados Unidos y el libre mercado, Ch?vez ha asegurado que los intereses del sector petrolero est?n bien cuidados en su pa?s.
Ch?vez ha hecho poco para diversificar los motores de la econom?a venezolana. Venezuela ocupa el ?ltimo lugar del hemisferio, excluyendo Hait?, en reducir regulaciones y procesos burocr?ticos que facilitan abrir y administrar un negocio, de acuerdo con el proyecto Doing Business del Banco Mundial. Eso es muy significativo si se tiene en cuenta que el 57 por ciento de la fuerza laboral en Am?rica Latina trabaja en micro, peque?as y medianas empresas.
Ch?vez ha restringido todav?a m?s a la econom?a venezolana al eliminar los intermediarios y utilizar las fuerzas armadas para asegurar una distribuci?n efectiva de alimentos subsidiados o servicios de salud. Los productos y servicios llegan a su destino pero a costa de empleos que podr?an ofrecer nuevas oportunidades a los pobres. Ch?vez ten?a raz?n en eliminar el intermediario que extorsiona a los pobres, pero lo que necesitaba era promover la competencia en vez de usurpar esa tarea en su totalidad.
El efecto neto de eliminar la competencia y mantener una alta dependencia en una sola fuente de ingresos -- el petr?leo representa el 80 por ciento de entradas por exportaci?n -- es la consolidaci?n del poder econ?mico. Encima de eso est?n sus esfuerzos por concentrar el poder pol?tico, Lo que Ch?vez no parece entender es que tarde o temprano ese poder podr?a pasar a manos de alguien cuyos intereses no coinciden con los de los pobres.
En sus primeros seis a?os en su cargo Ch?vez pr?cticamente no par? de hacer campa?a. Ahora es el momento de que reconozca finalmente lo que nunca pudo como candidato: no puede pretender gobernar a nombre de los pobres mientras ignora por completo a los ricos. La ret?rica antag?nica sirve para hacer campa?a, pero una vez en el poder representar los intereses de un grupo mientras se ignoran los del resto es auto destructivo. Basta con preguntarle a los predecesores de Ch?vez.
Si Ch?vez va a eliminar alguna vez las muchas dudas sobre sus credenciales democr?ticas y su capacidad como l?der, tiene una tarea monumental para los pr?ximos dos a?os. M?s a?n, si en verdad es seria su determinaci?n de convertir su revoluci?n por las clases bajas en algo m?s que un experimento loco de un candidato muy astuto, tendr? que reconocer que a menos que cambie sus m?todos podr?a terminar afectando a los pobres.
Si eso llegara a pasar, la desilusi?n de quienes han vivido demasiado tiempo en desesperanza en una tierra rica en petr?leo pero ahora han podido saborear dicha riqueza, podr?a llevar a consecuencias imprevistas. Para Ch?vez el reto es alinear los m?todos con una soluci?n a largo plazo.
El reto para la oposici?n es recuperarse como una fuerza pol?tica real. Y una forma de lograrlo es aceptar que la intenci?n de Ch?vez de ayudar a los pobres es leg?tima y, en consecuencia, apoyar e incluso cuestionarlo si el caso.
? 2004 The Washington Post Company


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Correction to This Article
An Aug. 19 article on Saudi religious influence in the United States incorrectly reported that Crown Prince Abdullah ibn Abdulaziz is the son of King Fahd and joined with the king in donating $8 million to build the King Fahd Mosque in Culver City, Calif. The donation with the king was made by his son, Prince Abdulaziz bin Fahd.
U.S. Eyes Money Trails of Saudi-Backed Charities
By David B. Ottaway
Washington Post Staff Writer
Thursday, August 19, 2004; Page A01
SAN DIEGO -- Omar Abdi Mohamed, a lanky, soft-spoken political refugee from war-ruined Somalia in East Africa, had been preaching the word of Islam in the United States for the past nine years. Two things make him unusual.
In January, U.S. immigration authorities arrested him, saying they suspected him of being a conduit for terrorist funds, federal court records show. At the time, he was on the payroll of Saudi Arabia's government.
Mohamed was one of 30 Saudi-financed preachers in this country. Each month, the Saudis paid $1,700 to the 44-year-old, who taught the Koran at a run-down Somali social center here. He worked with little supervision from Saudi religious authorities 8,000 miles away. In the late 1990s, he set up a small charity to help famine victims in Somalia, and that is how his trouble began.
The charity received $326,000 over three years from the Global Relief Foundation, a private Islamic charity based in Illinois. In October 2002, the U.S. Treasury Department designated Global Relief a terrorist-financing entity linked to al Qaeda.
The collision of Saudi missionary work and suspicions of terrorist financing in San Diego illustrates the perils and provocations of a multibillion-dollar effort by Saudi Arabia to spread its religion around the world. Mohamed worked on the front lines of that effort, a campaign to transform what outsiders call "Wahhabism," once a marginal and puritanical brand of Islam with few followers outside the Arabian Peninsula, into the dominant doctrine in the Islamic world. The campaign has created a vast infrastructure of both government-supported and private charities that at times has been exploited by violent jihadists -- among them Osama bin Laden.
Nearly three years after the devastating Sept. 11, 2001, attacks on the World Trade Center and the Pentagon, a number of Saudi-supported Islamic preachers, centers, charities and mosques remain under intense scrutiny. U.S. investigators continue to look into the tangled money trails leading from Saudi Arabia to its embassy in Washington and into dozens of American cities.
At the end of one trail is Mohamed. Another avenue of interest involves the global finances of the al Haramain Islamic Foundation, a large Saudi-government-supported charity set up to propagate Wahhabism and sometimes referred to as "the United Way of Saudi Arabia." Al Haramain, which has an office in Ashland, Ore., sent Mohamed $5,000.
The commission investigating the Sept. 11 attacks stated in its July report that al Qaeda had relied heavily on international charities to raise money, "particularly those with lax external oversight and ineffective internal controls such as the Saudi-based al Haramain Islamic Foundation." The report added that al Qaeda found "fertile fund-raising groups" in Saudi Arabia, "where extreme religious views are common and charitable giving was both essential to the culture and subject to very limited oversight."
The Saudis say they have taken more steps than any other country to crack down on terrorist financing. They say the problem is not with their religion but with a small minority of deviants.
The Saudi government has severed ties with Mohamed, who is charged only with immigration violations, but he insists he did nothing wrong. A hearing is set for Sept. 1 in San Diego. The terrorist suspicions against Mohamed appear to rest on financial transactions that raise questions but do not provide answers, court records show. Global Relief denies it funds terrorism.
The Saudis are also shutting al Haramain offices worldwide. In June, the Treasury Department put the charity's former head in Riyadh, Saudi Arabia, on its list of known supporters of terrorism for providing "financial, material and logistical support to the al Qaeda network."
Wahhabism arose in the mid-18th century in central Saudi Arabia. Mohammad Ibn Abdul Wahab sought to purify Islam and return it to its 7th-century roots. He preached doctrines based on a strict adherence to the literal word of the Koran. He opposed music and adornment, insisted that women be cloaked and disdained nonbelievers, even members of other Muslim sects.
Scholars of Islam find it difficult to precisely assess the impact of 40 years of Saudi missionary work on the United States' multi-ethnic Muslim community -- estimated at 6 million to 7 million. But survey data are suggestive.
The most comprehensive study, a survey of the 1,200 U.S. mosques undertaken in 2000 by four Muslim organizations, found that 2 million Muslims were "associated" with a mosque and that 70 percent of mosque leaders were generally favorable toward fundamentalist teachings, while 21 percent followed the stricter Wahhabi practices. The survey also found that the segregation of women for prayers was spreading, from half of the mosques in 1994 to two-thirds six years later.
John L. Esposito, a religion scholar at Georgetown University, said the Saudi theological efforts have resulted in "the export of a very exclusive brand of Islam into the Muslim community in the United States" that "tends to make them more isolationist in the society in which they live."
The Export of Islam
The worldwide export of Wahhabi Islam began in 1962, when Saudi Arabia's ruling Saud family founded the Muslim World League in Mecca to promote "Islamic solidarity." The Sauds were seeking to counter the fiery pan-Arab nationalism of Egyptian leader Gamal Abdel Nasser, who was calling for the Saudi monarchy to be overthrown.
The family also saw the export of Islam, which they call "Dawah," as a sacred duty. Their land was the birthplace of Islam and their kingdom host to the religion's two holiest mosques, in Mecca and Medina.
Western diplomats stationed in Riyadh liken the Sauds' fervor to the zeal of the United States' own fundamentalist sects. "For Saudi Arabia to stop Dawah would be a negation of itself," said Sherard Cowper-Coles, the British ambassador to the kingdom. "It would be like Bush telling Evangelical Christians to stop missionary work abroad."
In the 1960s, the kingdom was sparsely populated and still relatively poor. It had no trained foot soldiers to run the Muslim league. So the royal family enlisted scores of Egyptian teachers, scholars and imams belonging to the Muslim Brotherhood, a highly secretive movement of political activists dedicated to restoring Islamic rule over secular Arab societies.
By 1982, the Saud family was feeling threatened by the Islamic revolution begun by Shiite Muslim leader Ayatollah Khomeini in Iran and the extremism of some of its own citizens, who had temporarily seized the Grand Mosque in Mecca in 1979. Again, the family turned to Dawah.
King Fahd issued a directive that "no limits be put on expenditures for the propagation of Islam," according to Nawaf Obaid, a Saudi oil and security analyst. Saudi Arabia now had the money: Its oil revenue had skyrocketed after the 1973 oil embargo. King Fahd used the cash to build mosques, Islamic centers and schools by the thousands around the world. Over the next two decades, the kingdom established 200 Islamic colleges, 210 Islamic centers, 1,500 mosques and 2,000 schools for Muslim children in non-Islamic countries, according to King Fahd's personal Web site. In 1984, the king built a $130 million printing plant in Medina devoted to producing Saudi-approved translations of the Koran. By 2000, the kingdom had distributed 138 million copies worldwide.
Exactly how much has been spent to spread Wahhabism is unclear. David D. Aufhauser, a former Treasury Department general counsel, told a Senate committee in June that estimates went "north of $75 billion." Edward L. Morse, an oil analyst at Hess Energy Trading Co. in New York, said King Fahd tapped a special oil account that set aside revenue from as much as 200,000 barrels a day -- $1.8 billion a year at 1980s oil prices. Saudi oil expert Obaid confirmed such an account existed in the 1980s and 1990s but said it was recently closed.
Ministry's Far Reach
After the Persian Gulf War in 1991, radical elements in the kingdom and in the Muslim Brotherhood excoriated the Sauds for calling in the Americans to defend them. In response, King Fahd tightened control over the missionary-and-charity campaign and tried to purge it of Brotherhood influence, setting up a new Saudi-supervised charity, al Haramain.
As part of this effort, the Saudis created an Islamic affairs ministry in 1993 that was intended to be the key institution for exporting Wahhabism. The ministry, officially known as the Ministry of Islamic Affairs, Endowment, Call and Guidance, is led by Saleh Sheik, a direct descendant of Ibn Abdul Wahab.
The goal of moderating Brotherhood-like militancy was only partly successful. Saudi scholars and sources say the ministry has become a stronghold of zealots.
The Islamic affairs ministry is located in a nondescript concrete-and-glass structure in the Malaz district of Riyadh, near the city's old airport. There, in an interview at his office in March, Sheik said the ministry meets weekly to "coordinate the Islamic policies of the different ministries outside the country."
The ministry's outreach is formidable. It pays the salaries of 3,884 Wahhabi missionaries and preachers, who are six times as numerous as the 650 diplomats in Saudi Arabia's 77 embassies. Ministry officials in Africa and Asia often have had more money to dispense than Saudi ambassadors, according to several Saudi sources. The Islamic affairs officials also act as religious commissars, keeping tabs on the moral behavior of the kingdom's diplomats. In the United States, a 40-person Islamic Affairs Department established in the Saudi Embassy in Washington became something of an independent body, with little supervision from the often absent ambassador, Prince Bandar bin Sultan.
Sheik estimated the Islamic affairs ministry's budget at $530 million annually and said it goes almost entirely to pay the salaries of the more than 50,000 people on the ministry payroll . That figure does not include the hundreds of millions of dollars in personal contributions made by King Fahd and other senior Saudi princes to the cause of propagating Islam at home and abroad, according to a Saudi analyst who insisted on anonymity because of the sensitivity of the issue. The real total spent annually spreading Islam is between $2 billion and $2.5 billion, he said.
Sheik said his ministry "supervises" charities abroad to "make sure their funds go to the right places" and also provides religious books and scholars for Saudi-supported Islamic centers, schools and universities. But it has "no direct responsibility" for them, he said.
Sheik is the direct supervisor of one charity supported by the Saudi government, al Haramain, which added an entirely separate army of 3,000 missionaries to the 3,884 on the ministry payroll.
Al Haramain's annual budget, $40 million to $60 million, paid for mosques, schools, Korans, wells, food and Saudi-approved veils, as well as scores of health clinics and orphanages in some of the poorest corners of the world. It operated in 50 countries.
In October 1997, the charity established its first U.S. presence when it incorporated in Ashland, Ore. It listed as its board president Aqeel Abdulaziz Aqil, who had been general manager for the charity since its founding. He operated from the Riyadh headquarters.
Everything changed for al Haramain with the worldwide crackdown on terrorist funding that followed the Sept. 11 attacks. By March 2002, U.S. and Saudi authorities had designated al Haramain offices in Bosnia and Somalia as terrorist-supporting organizations that had diverted charitable money to al Qaeda and a suspected Somali terrorist group, Al Ittihad Al Islamiya.
Two years later, on Feb. 13, 2004, IRS officials raided the Ashland office, saying there was "probable cause" that two top al Haramain officers had violated U.S. currency laws and filed false tax returns to cover the transfer of money to Muslim rebels fighting in Chechnya. (U.S. authorities so far have brought no formal charges against those officers, and the Oregon office remains open.) Aqil was fired in January. Six months later, U.S. officials designated him a terrorist supporter because of his alleged contacts with the Somali group Al Ittihad, the same organization that Omar Abdi Mohamed in San Diego is suspected of aiding.
By then, 15 al Haramain branches had been shut down, including those in Indonesia, Kenya, Pakistan, Afghanistan, Albania and the Netherlands.
In his interview with a Washington Post reporter in March, Sheik defended the charity. His ministry's own investigation did not find "any major mistakes" by the charity's leadership, except by its director, Aqil.
"The mistakes of individuals should not be attributed to the whole institution," Sheik said.
In June, however, the Saudi government announced that al Haramain was being closed down and that the Islamic affairs ministry would be stripped of its role as the main overseer of missionary work. A government-run commission under the Foreign Ministry now has that responsibility.
But the commission does not oversee the three other major Saudi-based-and-financed charities -- the Muslim World League, the World Assembly of Muslim Youth and the International Islamic Relief Organization. Also independent of the commission is at least one private Saudi charity, al-Muntada al-Islami. The charity, based in London, works primarily in Africa and publishes an English-language Islamic monthly, Al-Jumuah, which is distributed in the United States.
These four Saudi charities recently formed a U.S.-based trade group, the Friends of Charities Association, and hired the Belew law firm in Washington to represent their interests.
In the United States, Saudi Arabia's infrastructure of preachers and money started as a bulwark against the spread into American mosques of radical Shiism, which surged after Khomeini deposed the shah of Iran.
"Many countries in the West asked Saudi Arabia to get involved in these [Islamic] centers because at that time Saudi Arabia was considered moderate," Saudi Foreign Minister Prince Saud Faisal said in an interview in March. The Americans "felt comfortable with the presence of the Saudis," he said.
Backed by Saudi money, this presence grew rapidly. King Fahd's Web site now lists 16 Islamic and cultural centers that the kingdom has helped finance in California, Missouri, Michigan, Illinois, New Jersey, New York, Ohio, Virginia and Maryland. The largest is the King Fahd Mosque in Culver City, a suburb of Los Angeles. The mosque, built with $8 million in private donations from the king and his son, Crown Prince Abdullah ibn Abdulaziz, was officially inaugurated in 1998 for 2,000 worshipers. It includes a Koranic school, an Islamic research center and a bookstore.
The Islamic Affairs Department at the Saudi Embassy in Washington spearheaded the campaign. At its height, the department had 35 to 40 diplomats and an annual budget of $8 million, according to a Saudi official.
In 1989, the Saudis also set up a high-powered Islamic learning center, the Institute of Islamic and Arabic Sciences in America, in Fairfax. The institute is an outpost of the Imam Muhammed Ibn Saud Islamic University in Riyadh, the main citadel for Wahhabi instruction.
The Islamic affairs ministry sent imams and itinerant preachers to the United States as well: As late as last year, it had 31 on its payroll, including Omar Abdi Mohamed in San Diego.
The ministry also flooded the American Muslim community with Saudi-published Korans and publications. "The great majority of books and magazines were authored by Saudi agencies," said Maher Hathout, chairman of the Islamic Center of Southern California in Los Angeles.
Hathout, an outspoken critic of Wahhabism, said the result was the increasing isolation of women in American mosques starting in the 1980s. "Mosques became gender-segregated, which didn't make any sense at all," he said.
The commentary accompanying the Saudi-published Koran, Hathout said, was "very alien to the spirit of tolerance" in U.S. society. "This may have sense over there [in Saudi Arabia] but doesn't make any sense here," he said.
In the 1990s, a "sharp debate" raged in U.S. mosques over Saudi fundamentalism, said Ihsan Bagby, chief author of the study "The Mosque in America." Radical "nongovernmental Saudi sheiks" became very active in pushing a far more militant brand of Wahhabism than the government-appointed imams, Bagby said. These radicals cultivated American Muslims, who used Saudi money to build their own mosques, he said.
In May 2003, the State Department refused reentry to the chief imam of the King Fahd Mosque in Culver City, Fahad al Thumairy, who also was a Saudi diplomat at the consulate in Los Angeles. The Sept. 11 commission report later said the State Department had determined "he might be connected with terrorist activity."
The report also said that two of the Sept. 11 hijackers, Nawaf Alhazmi and Khalid Almihdhar, "spent time at the King Fahd mosque and made some acquaintances there." Al Thumairy, who reportedly led an "extremist faction" at the mosque, denied knowing the two hijackers. While his denial was "somewhat suspect," the report said there was no evidence connecting him to the hijackers.
Last December, the State Department ended the practice of allowing religious scholars and missionaries to work here on Saudi diplomatic passports, forcing at least 24 out. The best-known deportee was Jaafar Idris, a Sudanese scholar well known in the Islamic world and founder of the American Open University, based in Alexandria, which in 2002 had 540 registered students pursuing undergraduate and graduate degrees in Islamic studies.
Also crippled by the crackdown was the Institute for Islamic and Arabic Sciences. Eleven of its scholars on diplomatic passports were ordered to leave. In early July, dozens of FBI, customs and IRS agents raided the institute's premises and questioned its six remaining non-Saudi teachers.
Late last year, the Saudi Embassy in Washington dissolved its Islamic Affairs Department, reducing the number of diplomats dealing with religious issues to one. The embassy also stopped distributing the Koran in the United States. At the same time, the Ministry of Islamic Affairs began reviewing its 31 missionaries and preachers in the United States. As of March, six had been fired.
The only one to go to jail was Omar Abdi Mohamed, the Somali teacher in San Diego.
Suspected Ties to Terrorism
A trader in hides, livestock and incense, Mohamed regularly visited Saudi Arabia in the 1980s. During one of his trips, he said, he was recruited by the kingdom's religious authorities in Mecca after being questioned about his knowledge of the Koran. In Somalia, preaching became a sideline for him, he said.
In 1989, Mohamed was jailed and tortured by the Somali military, which suspected him of involvement with the political opposition, according to statements Mohamed later made on his immigration documents. The following year, as Somalia degenerated into civil war, he was freed and fled to Canada. Five years later, he made his way to San Diego.
He had been recruited by a San Diego mosque to teach the Koran and Arabic to Somali children, he said later. He entered the United States on a religious worker's visa and received legal permanent resident status. The U.S. government would later say he never worked at the mosque that sponsored his visa.
Instead, Mohamed founded a small Koranic "school," actually just one room inside a shabby two-story Somali civic center in a section of City Heights nicknamed "Little Mogadishu," after Somalia's capital. Mohamed also worked part time as a social counselor for Somali children at a public school, which paid him $1,000 a month.
In 1997, Mohamed set up his charity, the Western Somali Relief Agency, to send money to Somalis facing famine in the Ogaden region of eastern Ethiopia. Over the next four years, the agency received $326,000 from the Global Relief Foundation, court documents show.
In April 2000, Mohamed applied for U.S. citizenship. He had an interview with U.S. immigration officials in May 2002. By then, the Sept. 11 attacks had made U.S. officials wary of any Muslims applying for citizenship. Mohamed's background was checked, and the immigration officers asked him pointed questions about his relief agency and the money that had circulated through it, court documents show.
He did not tell them initially that he was being paid by the Saudis or that he had received money from Global Relief and al Haramain, the records show.
In January, he was called in for a second interview. Afterward, he was arrested and charged with making multiple false statements.
"You've received funding well over $200,000 from Global Relief," said Steve Schultz, an immigration officer, according to a transcript of Mohamed's interview. "They were shut down because they were providing aid to terrorism. Okay, we think you're involved in that."
In October 2002, the Treasury Department designated Global Relief, based in Bridgeview, Ill., a terrorist-linked organization because it "has provided assistance to Osama Bin Laden, the al Qaeda Network and other known terrorist groups," a Treasury news release stated.
Rabih Haddad, the co-founder of Global Relief, had belonged to an organization that was a precursor to al Qaeda. Charity officials had also had multiple contacts with the Taliban government in Afghanistan and bin Laden's personal secretary, who was convicted of participating in the 1998 bombings of the U.S. embassies in Kenya and Tanzania.
The Treasury Department release stated that photographs found in a trash bin outside Global Relief's office in Illinois depicted armed fighters and a shipment of sophisticated communications equipment worth $120,000. Videotapes stocked by Global Relief glorified armed jihad. "God equated martyrdom through JIHAD with supplying funds for the JIHAD effort," a 1995 Global Relief Foundation pamphlet stated. "All contributions should be mailed to: GRF."
U.S. investigators have been unable to track all of the money Mohamed received from Global Relief. The bulk of it went in checks written to Dahab Shil, an informal money transmitter in Chicago known among Muslims as a hawala. The 65 checks to Dahab Shil range from $370 to $60,000, according to court documents.
Mohamed said the money went to various local charities and tribal chiefs in the Ethiopian Ogaden. Transcripts of his interviews show U.S. officials suspect that some of it went to Al Ittihad Al Islamiya, the Somali terrorist group that the head of al Haramain has also been accused of dealing with.
During an interview in May at the federal prison in Otay Mesa, 15 miles south of San Diego, Mohamed insisted he was not a Wahhabi extremist, just a Muslim. He denied ever having contacts with Al Ittihad. With the loss of his $1,700 monthly stipend, his wife and six children live on a monthly welfare check of $1,178.
Research editor Margot Williams and researcher Alice Crites contributed to this report.
? 2004 The Washington Post Company


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Saudi Reform Advocates' Trial Postponed
BY ABDULLAH AL-SHIHRI
The Associated Press
Monday, August 23, 2004; 1:52 PM
RIYADH, Saudi Arabia - A Saudi judge on Monday postponed the trial of three democratic reform advocates after their supporters, in a rare show of public dissent, demonstrated for access and then protested loudly once allowed into court.
More than 400 supporters of Matrouk al-Faleh, Ali al-Dimeeni and Abdullah al-Hamed held the three-hour peaceful protest outside the courtroom.
The three defendants refused to begin the session, complaining to the judge that their supporters were barred from attending. The judge replied that the courtroom was full and that all those attending were from the public.
"Most of those in this court are intelligence agents, brought here to deceive the public," the defense countered.
The judge then ordered that those outside be allowed to enter.
Once inside, the supporters began shouting pro-reform slogans.
"Long live reform! God is with you! We are together on the path to reform," they shouted, said a courtroom observer on condition of anonymity.
No arrests were made and the judge postponed the session without setting a date for the next hearing.
During the first session of the trial last week, the three reformists were charged with sowing dissent, creating political instability, printing political leaflets and using the media to incite people against the government.
That session was held in public, an unprecedented move in the kingdom, and was attended by 200 people. Saudi trials are normally held behind closed doors.
Whether Monday's session would be open or closed had not been officially announced. Supporters of the defendants arrived assuming it was open.
The defendants are the last remaining detainees of a group of 13 reformist intellectuals who were arrested on March 17. In newspapers and on television, they had criticized the kingdom's strict religious environment and slow pace of reform.
Some of the 13 had signed a letter to Crown Prince Abdullah calling for political, economic and social reforms, including parliamentary elections. Others had demanded the absolute monarchy become a constitutional monarchy and had criticized the National Human Rights Association, a new body whose members were appointed by the king.
The detentions caused tension between Riyadh and Washington after the U.S. State Department condemned them as "inconsistent with the kind of forward progress that reform-minded people are looking for."
The Saudi Foreign Ministry replied it was "disappointed" by the U.S. reaction.
The Saudi royal family has absolute power, and Saudis cannot hold public gatherings to discuss political or social issues. However, fear of domestic terrorism - brought home for Saudis after May 12 suicide bombings that killed 35 people, including nine Saudi attackers - has initiated an unprecedented public debate. Some Saudis argue lack of democracy has made the kingdom a breeding ground for extremists.
Last year, police quickly arrested participants in a Riyadh protest and stifled entirely a follow-up demonstration in Jiddah, both of which were organized by a London-based Saudi dissident group. The Movement for Islamic Reform in Arabia had organized protests to demand the release of some of the hundreds of people arrested in the aftermath of the May 12, 2003, suicide bombings in Riyadh. It maintains terrorism is being used as an excuse to round up political opponents.
? 2004 The Associated Press


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FBI briefs Wolfowitz on Israeli spy claim
By Curt Anderson in Washington
31 August 2004
The US deputy defence secretary, Paul Wolfowitz, has been briefed on the FBI's investigation into a Pentagon analyst suspected of passing US secrets on Iran to Israeli officials.
Media reports over the weekend have forced the FBI to accelerate its probe into Larry Franklin, a former attache to the US Embassy in Israel and a staffer in the office of Douglas Feith, the defence department's undersecretary for policy
Mr Franklin was yesterday described by law enforcement officials as cooperating with the FBI's investigation.
Investigators are trying to determine whether Mr Franklin passed classified material about Bush administration policy on Iran to the American Israel Public Affairs Committee, the major Israeli lobbying group in Washington, and whether Aipac in turn passed it to Israel.
Aipac has acknowledged that the FBI has interviewed some of its employees but denies any wrongdoing. "We've cooperated in this investigation. We think there is nothing to it," said Nathan Lewin, an Aipac attorney.
Israeli Foreign Minister Silvan Shalom said yesterday that meetings between Israeli embassy employees and US officials are commonplace, and that the two governments routinely share secrets.
Israeli officials confirmed a senior Israeli diplomat identified as Naor Gilon, head of the Israeli Embassy's political department in Washington, has met with Mr Franklin. Mr Gilon told the Israeli newspaper Maariv that he did nothing wrong but was concerned that he may no longer be able to work in Washington because of the investigation.
Schr?der poised for historic U-turn over EU referendum
By Tony Paterson in Berlin
31 August 2004
Gerhard Schr?der's ruling Social Democrats have bowed to public pressure and announced plans to scrap Germany's 54-year-old ban on national plebiscites which would allow the country to join Britain and France in a referendum on the planned European constitution next year.
The decision, taken by the Chancellor's Social Democrat Party leadership on Sunday, follows months of mounting public pressure for a nationwide referendum on the EU constitution in Germany where polls suggest 70 percent of the population is in favour.
Franz Muentefering, the Social Democrat Party leader said his party would put new legislation before the Berlin parliament this autumn seeking approval for scrapping Germany's ban on national referendums.
"If we manage to get the law changed, it could be possible to hold a referendum at the beginning of 2005," Mr Muentefering said. "The public should be given the opportunity to voice its opinion between general elections."
National plebiscites are banned in an attempt to ensure that the country remains anchored in parliamentary democracy. The memory of the Nazi era and Adolf Hitler's unscrupulous use of plebiscites to consolidate his hold on power led the architects of Germany's 1948 constitution to ban them from the political process. At present, the German constitution allows referendums only on regional issues and within the country's 16 federal states.
Only last month, Chancellor Schr?der appeared to be firmly against changing the law. "Even if we wanted to have a vote, we would not be allowed to," he said. "Plebiscites are illegal under our constitution."
But the decision by Britain, France and Spain to hold separate referendums on the proposed EU constitution, has provoked a clamour in Germany for its ban to be revoked. Backing has cut across the political spectrum. Edmund Stoiber, the conservative Bavarian Prime Minister who ran against Mr Schr?der in Germany's 2002 election, declared last month: "If the French and the British are to hold a referendum on this issue, the Germans cannot be barred from the process."
His stance has been echoed by Roman Herzog, Germany's former conservative president, who said Germany faced the possibility of being the only country in Europe not to hold a referendum. Other advocates include Germany's liberal Free Democratic Party, Mr Schr?der's Green coalition partners, and Wolfgang Thierse, Germany's Social Democrat parliamentary president.
But Germany's opposition conservative party leadership is still opposed to the idea. Angela Merkel, the Christian Democrat leader, said the EU constitution should be decided by parliament alone. Unless the conservatives change their minds, Mr Schr?der may find it difficult to secure the two-thirds parliamentary majority needed for such a referendum.
Wolfgang Schaeuble, the former Christian Democrat party leader, warned: "There is a danger that a referendum on the EU constitution would lead to a vote that has nothing to do with the EU." Mr Schr?der's Social Democrats had until last week privately voiced fears that a plebiscite on the EU constitution could lead to a massive vote of no-confidence in Germany's already unpopular government. They appear to have been swayed by the argument that by supporting the idea, the government may be able to recoup badly needed voter support.
* Tens of thousands of demonstrators took to the streets in more than 150 German towns and cities last night to protest against the Schr?der government's plans to slash benefits for the long-term unemployed under its economic reform programme. In the east German city of Leipzig, Oskar Lafontaine the former left-wing German Finance Minister and former Social Democrat Party leader, was to attempt a political comeback with a scathing attack on the government's policies.
30 August 2004 19:53
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Detainee In Probe Of Hamas Released
N. Va. Man Can Await Case on Bond
By Eric Rich
Washington Post Staff Writer
Tuesday, August 31, 2004; Page B01
An Annandale man jailed for 10 days as a witness in an investigation of the Islamic Resistance Movement, or Hamas, was released on $1 million bond yesterday after a closed proceeding at U.S. District Court in Baltimore.
Ismael Selim Elbarasse was freed after he and others posted their homes as collateral to ensure his appearance before a grand jury in Chicago, where Elbarasse is sought for questioning, his attorneys said.
Elbarasse, who was detained Aug. 20 after police said they saw his wife videotaping the Chesapeake Bay Bridge, walked out of the courthouse yesterday and was reunited with his family at the office of his attorney Franklin W. Draper.
Later, in Annandale, Elbarasse agreed to be photographed but declined to be interviewed. The accountant, a naturalized U.S. citizen, has not been charged with a crime.
"I think it's a victory that he finally was able to get out," Draper said. "In a roundabout way, the system kind of worked in terms of getting him his freedom."
Elbarasse, 57, was named as an unindicted co-conspirator by the grand jury in Chicago. Authorities say Elbarasse was an assistant to Mousa Mohammed Abu Marzook, one of three men charged in an indictment unsealed in Chicago on Aug. 20.
The indictment charges Marzook, deputy chief of Hamas's political wing, with conspiring to raise millions of dollars for Hamas, which the U.S. government considers a terrorist group for carrying out bombings, kidnappings and other attacks in Israel. Elbarasse was arrested on a material witness warrant from Chicago.
In court filings, the FBI said the two may have been scouting a potential terrorist target -- an assertion that has been vigorously disputed by Elbarasse's family and his attorneys.
No charges were filed in connection with the videotaping. Elbarasse's attorneys said no date has been set for his appearance in Chicago.
"It's amazing," said one of the attorneys, Stanley L. Cohen, who has questioned the government's motives for bringing the case. "Everyone was so anxious to put handcuffs on him, and there's no date for his appearance in Chicago. . . . John Ashcroft got the political mileage out of this that he wanted."
Elbarasse will appear before the grand jury, Cohen said, but whether he will testify is less clear. Elbarasse was jailed for eight months in 1998 for refusing to cooperate with a New York grand jury investigating terrorism.
"He will do what his conscience and his politics and his life's work tell him he must do," Cohen said.
U.S. Magistrate Judge Paul W. Grimm ruled Friday that the public would be excluded from yesterday's detention hearing, rejecting requests from lawyers for The Washington Post and the (Baltimore) Sun. Grimm said the hearing would involve evidence derived from the secret grand jury proceeding and thus must be closed to the public.
Elbarasse, one of his sons and two other Northern Virginia residents -- a surgeon and a schoolteacher -- posted their homes to secure his release, said Ashraf Nubani, an immigration attorney and family friend who organized the effort. The properties could be seized if Elbarasse fails to appear when he is summoned to Chicago.
Speaking at Elbarasse's home in Annandale, Nubani described the arrest as part of an "attack on Palestinian activism" and said, "The reality is, it's unfortunate that after 9/11 a Muslim family can't take video of their vacations. . . . They can't do what other Americans do freely because they are afraid."
Asked whether Elbarasse is a supporter of Hamas, Nubani said: "He's like any other Palestinian, and Palestinians look for justice and they look for some sort of redress to what's befallen them."
? 2004 The Washington Post Company
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Syria-Dictated Move Prompts Political Uproar in Lebanon
By JOHN KIFNER
Published: August 31, 2004
BEIRUT, Lebanon, Aug. 30 - Lebanon's hothouse politics have been thrown into turmoil by Syria's insistence - at a suddenly summoned special cabinet meeting over the weekend - that the president it chose for Lebanon stay in office past his constitutional term.
The outcome was not unexpected here, where Syria, with 20,000 troops still in the country, has called the final political shots since the end of the 15-year civil war in 1990. The vigorous local press has spent reams on hand-wringing analysis over the question of amending the Constitution to keep President Emil Lahoud in office beyond the constitutional limit of a single six-year term, which expires in November. In the end, the result has generally been conceded to be inevitable.
The United States has strongly expressed its opposition to the Syrian pressure, as has France, once the colonial power here. But the swift and unexpected move to call Saturday's session, which lasted only 10 minutes and approved the constitutional amendment for a three-year extension, stunned many here and provoked a widespread outcry. Parliament is expected to meet shortly to approve the extension.
"Plotted by night and carried out swiftly by day," the Maronite Christian patriarch, Cardinal Nasrallah Pierre Sfeir, a critic of the amendment, protested in his Sunday sermon. "Those directly involved were seized to express a view imposed on them and obeyed submissively." The cardinal is the spiritual leader of the Maronites here. Under the longstanding division of political power in Lebanon, the president is a Maronite, the prime minister is a Sunni Muslim, and the speaker of Parliament is a Shiite Muslim.
Much of the attention focused on the role of Prime Minister Rafik Hariri, a billionaire who has publicly opposed the constitutional amendment and whose long-running feud with President Lahoud has often paralyzed the government. But on Saturday, Mr. Hariri presided over the meeting and urged approval. Information Minister Michel Samaha quoted him as telling the cabinet that "the situation in the region required special measures."
It was widely noted that Mr. Hariri's apparent change of heart came after he met Friday evening with the Syrian chief of military intelligence, Maj. Gen. Rustom Ghazaleh. The intelligence chief functions as a kind of Syrian pro-consul in Lebanon. The Druse chieftain, Walid Jumblatt - whose three Progressive Socialist Party ministers cast the only opposing votes - was so outraged he demanded that the memorabilia of his assassinated father, Kamal Jumblatt, be moved out of a museum at the presidential summer palace. The leading daily An Nahar called the weekend meeting a "farce," and even the generally pro-Syrian As Safir called the decision "shocking."
The amendment needs a two-thirds majority of the 128-seat Parliament. Mr. Jumblatt's bloc of 17 seats, Mr. Hariri's of 18 and about 10 Christian opposition rightists could have formed a nucleus to block it. But this does not appear likely now, given Mr. Hariri's stance.


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Jumblatt stands firm against constitutional amendment
Druze leader advises Lahoud to resign so as to avoid snare
By Nayla Assaf
Daily Star staff
Tuesday, August 31, 2004
BEIRUT: Druze leader Walid Jumblatt confirmed Monday his MPs will vote "No" to the constitutional amendment allowing President Emile Lahoud to remain in power, after he invited Lahoud to resign to avoid leading the country into "a trap."
The long-awaited position of Jumblatt and his 16-MP bloc came in one of his harshest diatribes to date, confirming the stance taken by his ministers during the surprise meeting that endorsed the extension of Lahoud's term over the weekend.
While the entire Cabinet opted for the Syrian-orchestrated amendment to the Constitution allowing Lahoud to remain in power for three more years in a swift meeting Saturday morning, Jumblatt and his allies remained the only pro-government group to stand up against the position.
The amendment, which has been denounced by international players, including the US, the EU, France and Germany, has yet to pass to Parliament, possibly next week, to become final.
Responding to criticism that he had endorsed a similar extension to former President Elias Hrawi in 1995, Jumblatt said: "I agreed with it then as there were joint Lebanese-Syrian interests at stake, and to prevent a military man from coming to power."
"In 1998 (when Lahoud was elected president), we were a minority to refuse handing the power to a military man and we are still on our position," he added.
As to warnings that the anti-extension trend is harming Syria, Jumblatt said: "After the vote, if I see that there are looming dangers on Syria, then I will call the Syrian leadership. But I repeat, later on."
He added: "To avoid the trap he has set for himself, for us and for Lebanese-Syrian relations, I advise (Lahoud) to resign."
Meanwhile, the technical procedures for the amendment are taking an unusually fast turn with Speaker Nabih Berri calling for an extraordinary meeting of Parliament's Managing Committee for next Wednesday. The committee is supposed to fix the date for the plenary session that is to vote on the amendment, "possibly as early as next week" sources said.
Meanwhile, more than 14 years after the end of the civil war, international and regional interference in domestic affairs is resurging openly, with major international players engaging in Lebanon's upcoming presidential battle.
Reports that a joint US-French UN Security Council resolution was being drafted were confirmed Monday.
In response, the Lebanese delegation to the UN, addressed a memorandum to the Security Council warning of the dangers of such a resolution and defending Syrian presence here.
While French President Jacques Chirac called for the Constitution to be respected last week, Germany's Foreign Minister Joschka Fischer and several White House spokespeople reiterated the calls over the weekend.
As expected, the 12 MP-strong Loyalty to the Resistance parliamentary bloc announced it would vote for the constitutional amendment "because betting only on changing the person will not resolve the situation."
The bloc backed by Hizbullah issued a statement saying that "the elections have dual national and regional importance," adding that "because (Lahoud) backed the choice of the resistance and defended it ... and because he has the honesty and required qualities," he was the bloc's first choice for a president.
Meanwhile, the Qornet Shehwan Christian opposition gathering, which comprises five MPs, is still studying ways to oppose the constitutional amendment. Following a meeting of the group's secretariat general Monday, Qornet Shehwan speaker Samir Abdel-Malak said: "We are going to coordinate with all sides proposing to safeguard the Constitution."
The seven MPs of the Qada of Zahle also announced they would be voting for the extension of Lahoud's term, despite the fact that some of them had opposed the amendment of the Constitution virulently.
The decision came following a meeting at the home of Industry Minister Elias Skaff in Yarzeh. On earlier occasions, one of the group, Zahle MP Nicholas Fattoush, who has a well-known feud with Lahoud, had confirmed to The Daily Star that he would not back the amendment no matter what happens.
Also Monday, after two weeks of statements by US officials denouncing Syrian interference, US Ambassador Jeffrey Feltman expressed "disappointment" over Saturday's decision to amend the Constitution.
Speaking at a news conference, Feltman said: "The Lebanese people deserve to have (their) Constitution respected," but added that the US had no position on specific candidates.
"The US has been clear for some time that we want to see a fully sovereign, fully independent Lebanon where decisions about Lebanese elections reflect the will of the Lebanese people without outside interference in the process," he said. "We believe it is in the best interests of Syria and Lebanon to have a positive and constructive relationship ... but we believe this relationship should be based on the principles of mutual respect and noninterference in each others domestic affairs."
Meanwhile, the Culture Ministry has not yet acted upon Jumblatt's request Saturday to remove memorabilia belonging to his father, Kamal Jumblatt, from the summer presidential residence of Beiteddine, as it has yet to receive an official demand.
In one of his most sarcastic tirades, Jumblatt, had requested that the items be removed to Mukhtara, as "these symbols of martyrdom cannot coexist with military bullies." - Additional reporting by HabibBattah

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U.S., France seek U.N. action on Lebanon
Washington, DC, Aug. 30 (UPI) -- The United States and France are discussing a U.N. resolution that would support Lebanon's sovereignty, a senior U.S. State Department official said.
"We are discussing with the French a possible resolution at the Security Council that would stand up for Lebanon's right to decide its own fate," the official told reporters on condition he not be identified.
Lebanon appears ready to amend its constitution so President Emile Lahoud can serve beyond his six-year term, which is due to end in November. Although many Lebanese are against such a move, Syria, the main power broker in the country, supports the idea. Syria maintains troops in the country, a bone of contention between Damascus and Washington, which wants all foreign forces out of Lebanon.
"The Lebanese should be able to figure out their own future free of all and any outside interference," U.S. State Department spokesman Richard Boucher said Monday.
He confirmed there had been some discussions with the French and other U.N. members on the issue, but declined to elaborate.

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Taxed Town
Bloomberg's New York.
By Chris Edwards
After New York's Republican mayor, Michael Bloomberg, gives the opening speech at the upcoming GOP convention tonight, he should stick around to hear President Bush talk tax policy Thursday. Bush gave Americans the largest tax cut in more than two decades -- while Bloomberg imposed a series of large tax hikes, which largely offset the benefits of the Bush cuts for New Yorkers.
Bloomberg's tax increases tarnished the GOP's tax-cutting image, and he added insult to injury with a tax reversal like that of the first President Bush. In his 2002 inaugural address, Bloomberg declared: "We cannot repeat the mistakes of the past. We cannot drive people and business out of New York. We cannot raise taxes." But Bloomberg proceeded to hike the city's cigarette tax rate from 8 cents to $1.50 per pack, increase property taxes 18 percent, and raise income and sales taxes.
Bloomberg's high-tax policies are worse than a repeat of New York's past mistakes. Today, skilled workers and investment capital are more mobile than ever, and are more likely to flee high-tax jurisdictions. The types of industries that New York depends on, such as media and financial services, are particularly footloose. Despite the many advantages of New York, intense global competition is forcing businesses to minimize every cost, including tax costs.
The mayor argues that tax hikes were needed to balance the city's budget. But current city projections show that a $3.7 billion deficit will open again by 2006. Clearly, tax hikes have not solved the city's budget problem. That's because higher taxes simply fuel expanded spending and allow politicians to avoid tough budget trade-offs. And the overall burden -- of income, sales, property, and other taxes -- is much higher than the average for 51 U.S. cities examined in a study by the District of Columbia government. The study found that at a $50,000 income level, New York families paid 30 percent more taxes than average. At a $75,000 income level, New York families paid 41 percent more.
As a billionaire, Bloomberg may not appreciate the hardship imposed on middle-class families by having to pay thousands of dollars in city taxes each year. But as a former businessman, Bloomberg should understand the economic damage caused by high taxes. Yet he hammered New York with tax increases right after 9/11, with the result that the city's economy has been much slower to recover from the recession than the national economy.
Looking ahead, some New York officials are calling for further tax hikes to close future budget gaps. But Bloomberg can ward off more tax hikes by pressing for cuts to New York's bloated $48 billion general-fund budget -- a budget that expanded 53 percent between 1994 and 2004. A new Cato Institute study by New York economist Ray Keating provides numerous reform options for Bloomberg to consider. Some city services can be contracted out to the private sector to save money and improve quality. Other services -- such as housing, transportation, and recreation facilities, including golf courses, ice rinks, and stadiums -- can be privatized. City-worker schedules could be better planned to cut rapidly rising overtime costs. The city's pension plan could be converted to a defined-contribution system. Extra Medicaid services not required by federal rules can be pared back.
New York can no longer coast on its impressive business history; to attract new employers, it has to cut taxes. As a major business center, New York should have one of the lowest unemployment rates in the country, not one of the highest. Bloomberg's challenge is to reform the budget, cut the uncompetitive tax load, and make New York a leading center of growth once again.
-- Chris Edwards is director of fiscal policy at the Cato Institute.

http://www.nationalreview.com/comment/edwards200408300846.asp
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City Council v. NRA
New York likes Republican money, but not Republican values.
By Dave Kopel & Paul Blackman
The New York city council was originally happy with the thought of money pouring into the city for the Republican National Convention. Unfortunately, the city council was shocked to learn that the convention will bring not only GOP dollars, but also visits from groups trying to influence the Republican party. Although pro-terrorist demonstrators are threatening to wreak havoc in New York (as of yet they've fallen short), the council has been getting worried about the arrival of a much more sedate group: the National Rifle Association.
This spring, several city-council members introduced Resolution No. 11 denouncing the National Rifle Association's presence at the Republican Convention. A modified version of the resolution was approved by a voice vote on March 10, with seven recorded dissenters.
It is patently silly to expect the NRA not to be part of the convention. Since the NRA was founded in 1871, seven presidents of the United States have been members. That is only one fewer than the number of presidents in the same period who have been members of the Democratic party.
By contrast, no member of the New York city council has ever become president of the United States. Historically speaking, the chance that a randomly selected NRA member will one day be the president is notably greater than the chance that a New York city-council member will become president. (The two New York City residents who became president -- Chester Alan Arthur and Theodore Roosevelt -- were both Republicans who avoided the city council. The former started out as head of the Customshouse; the latter first won office in the New York state assembly.)
The original version of this year's New York City resolution complained that the NRA's "stated goal" is to preserve the rights "guaranteed by the Second Amendment to the U.S. Constitution." The draft resolution also urged the Republicans to bar the NRA from the Republican Convention. As adopted, the resolution merely asks the GOP to denounce the NRA.
According to the revised resolution, the NRA lobbies "based on the belief that people have a right to bear arms." This is true -- just as the ACLU lobbies based on the belief that people have a right to freedom of speech.
The resolution is incorrect, though, in its claim that the NRA "lobbies on behalf of the nation's gun industry." The NRA is a consumer group; lobbying on behalf of the industry is performed by the Sporting Arms & Ammunition Manufacturers Institute (SAAMI).
Usually the NRA and SAAMI share common goals -- just as book readers and book publishers often have common goals. But sometimes the NRA and the industry diverge. For example, the first major federal anti-gun law, the Gun Control Act of 1968, was initially pushed by American manufacturers to curb the spread of inexpensive imported guns. For similarly protectionist reasons, the industry supported Drug "Czar" William Bennett's 1989 ban on the importation of so-called "assault weapons." In 1993, the American Shooting Sports Council (an industry group later absorbed by SAAMI) even endorsed the Brady Bill!
The NRA, as the New York resolution accurately notes, has lobbied against legislation banning some guns, and against sharply restricting who may own guns; it has lobbied in favor of legislation that would prevent gun registration, and also in favor of legislation to prohibit abusive lawsuits against lawful firearms manufacturers. Among those abusive lawsuits is a case filed by the New York City government.
Similarly, the ACLU opposes censoring books, and lobbies against restrictions on who may read certain books. The ACLU supports the abolition of registration for book-readers (as was once required for people who received "subversive" foreign books in the mail) and supports restrictions on lawsuits that could endanger the First Amendment.
Even if one does not agree with the ACLU on every single First Amendment issue, it would hardly be fair for a city council to denounce the ACLU for zealous advocacy of constitutional rights. We have found no evidence, for example, that the city council plans to denounce ACLU's state affiliate, the New York Civil Liberties Union, for its vigorous defense of planned massive demonstrations against the GOP, despite concerns from federal and local law-enforcement authorities.
So the city-council resolution attempts to buttress its animus against the NRA by engaging in character assassination of the NRA leadership. To do so, the resolution cites a litany of out-of-context statements attributed to "members of the NRA leadership." Actually, the statements were doubly removed from context: First, the Brady Campaign took out of context a variety of statements from various NRA staff, board members, and supporters, and posted them on its website; then the city council lazily used portions of some of those quotations to denounce the NRA.
The first quote comes from Wayne LaPierre, the NRA's CEO. According to the resolution, LaPierre called "anyone who supports gun control 'an enemy of freedom and a political terrorist.'" Well, the resolution as originally proposed called on the GOP to keep the NRA away from a political convention, so it would be fair to characterize the resolution's anti-gun sponsors as enemies of freedom.
But LaPierre's actual statement was broader, denouncing all people working in various ways to "advance an anti-freedom agenda of any kind" as "enemies of freedom and political terrorists." It's hard to know why the city council is upset that LaPierre claimed that people who "advance an anti-freedom agenda of any kind" are "enemies of freedom": The statement is a tautology.
As for the "political terrorists" quote, it was inflammatory rhetoric and obvious hyperbole. LaPierre delivered the line at the Spring 2002 NRA Annual Meeting; it was the first NRA meeting following the anti-gun lobby's attempt to use 9/11 to push gun prohibition and to claim that the NRA is pro-terrorist. In essence, LaPierre responded, "No we're not; you are."
Still, we can understand why the New York city council would be upset at the use of the word "terrorist" as part of a characterization of someone who is merely a political opponent, and not an actual terrorist. We assume, therefore, that the New York city council, to be consistent, has many more denunciation resolutions planned. Among the people to be denounced must be John Kerry, who in January 1996 called congressional Republicans "legislative terrorists" because of the federal-government shutdown. He elaborated: "Terrorists hold hostages, and the Republicans are holding the government hostage." (Note to Kerry: Telling someone not to come to work today because there's no money to pay him is different from kidnapping him and hacking his head off.)
Likewise, a non-hypocritical New York city council would denounce the NAACP, whose president, Julian Bond, claims that President Bush's judicial nominees come from the "most rabid followers of the Taliban wing of American politics."
LaPierre aside, our favorite quotation from the resolution -- for obvious reasons -- is attributed to Paul Blackman, who is identified as "a head NRA researcher." Blackman is quoted as saying that deaths of homicide victims who are "criminals themselves and/or drug addicts or users...in terms of economic consequences to society, are net gains." Well, "in terms of economic consequences," that's generally true.
Those 18 words are from a 22,000-word paper discussing and refuting various allegations made against firearms freedom, based on a "public health" approach to the topic. The specific issue, addressed in a few paragraphs, is the assertion that gun-related injuries and deaths cost society $20 billion annually. Blackman noted that most of the alleged "costs" were lost productivity -- lower contributions to society (taxes paid, etc.) that were lost if a productive young person died. One of the oddities of the public-health "productivity" analysis is that it sees children and retired people as drains on society. According to this flawed analysis, if a 20-year-old gangster shoots an 80-year-old, there is no economic loss to society beyond the costs of the funeral; on the other hand, if the 80-year-old victim manages to kill the 20-year-old in self-defense, tens of thousands of dollars in productivity are imagined to have been lost.
Blackman simply noted that, to the extent these young thugs were unlikely actually to become productive members of society, their deaths did not deprive society of tax revenue or other economic productivity. If they were caught and sent to prison, they would cost society about $20,000 per year. If their criminal careers were not interrupted by prison or by being shot (either by a good citizen or by another criminal), the most active of these criminals would cost society about $400,000 per year, according to Justice Department estimates.
Let us emphasize, again, that the discussion was of the economic consequences. There was nothing suggesting that the lives of predatory criminals or drug abusers were otherwise worthless. We have long recognized the problem Gilbert and Sullivan noted in The Pirates of Penzance:
When a felon's not engaged in his employment,
or maturing his felonious little plans,
his capacity for innocent enjoyment,
is just as great as any honest man's....
When the enterprising burglar's not a-burgling,
when the cut-throat isn't occupied in crime,
he loves to hear the little brook a-gurgling,
and listen to the merry village chime.
Perhaps more important, it is astounding how the Blackman quote was used in the city-council resolution. The "Whereas," after all, is to support the "Resolved" conclusion that "comments made by members of the National Rifle Association leadership are offensive to many communities that bring to the City the diversity that ensures its vibrancy." Well, if you think that violent criminals add "diversity" and "vibrancy" to a city, then you might get upset at Blackman for pointing out that such criminals do not add any economic value.
The city council's action is preposterous and hypocritical: The council denounces political diversity (energetic defense of constitutional rights) while proclaiming its love of "diversity." By the council's reasoning, violent criminals add "diversity" and "vibrancy" to a city, but constitutional-rights advocates do not.
We happen to think that (non-criminal) people of all sorts can add vibrant diversity to a city, including both the GOP delegates and the (law-abiding) left-wing demonstrators about to descend on the Big Apple. If the New York city council really valued diversity, the council might pass a resolution condemning councilman Charles Barron. Barron is an unapologetic former member of the Black Panthers, a racist, violent hate group. At a rally in favor of slavery "reparations," Barron announced that he sometimes wanted to "slap" a white person for his own mental health.
After passing a resolution against Charles Barron, the city council could turn its attention to another of its very own bigoted foes of diversity: councilman Robert Jackson, who complained that Jews had delayed speedy enactment of a resolution opposing the liberation of Iraq.
Genocide deprives a community of "diversity" and "vibrancy," so an intellectually honest city council would be quick to pass resolutions against people who support genocide. But instead, councilman Charles Barron was allowed to throw a council reception for Robert Mugabe, the genocidal tyrant of Zimbabwe. Meanwhile, councilman Robert Perkins is trying to name a street after former councilman Benjamin Davis (1904-64). Davis was a card-carrying Communist and an enthusiastic defender of Stalin and his genocide, even after Khrushchev exposed Stalin's crimes in 1956.
Rather than working itself into a snit over comments by members of a civil-liberties group in Fairfax, Virginia, the New York city council would better serve the cause of diversity by dealing with the hate-mongers and the apologists for mass murder currently found in its own ranks.
The city-council resolution is not all bad, however. Blackman has never been personally denounced by any legislative body. In most places outside of New York City (and especially in Blackman's home state of Virginia), such a denunciation is a badge of honor -- personal recognition for more than a quarter-century of work on behalf of the right that best preserves the entire Bill of Rights. All Blackman wants is a fancy copy of the resolution suitable for framing.
-- David Kopel is research director of the Independence Institute, and Paul Blackman is research coordinator of the National Rifle Association. They are benefactor members of the NRA, and co-authors of No More Wacos: What's Wrong with Federal Law Enforcement and How to Fix It.

http://www.nationalreview.com/comment/kopel_blackman200408300841.asp


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Liberalism, Loose or Strict By Anthony de Jasay presented by www.cne.org
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Introduction The Centre for the New Europe (CNE) is proud to present its readers with "Liberalism, loose or strict", a paper by Anthony de Jasay. The paper was originally presented at the Liberales Institut of Zurich in December 2003. CNE thanks Liberales Institut's President Robert Nef for authorizing the present publication. Anthony de Jasay is one of the few truly original minds in contemporary social science. He is well-known for combining analytical rigor with a realistic approach to social phenomena--a rare quality, given that the industry of political superstitions, which has no purpose but to dress the emperor, is still working at full capacity. Jasay has been opposing such a tendency for some time. His acclaimed book, The State (1985), perhaps the finest treatise on the subject, has opened the eyes of more than a few readers to the true nature of the institution par excellence, in the realm of modern political philosophy. His Against Politics (1997), a collection of penetrating essays, has illuminated the shortcomings of F.A. Hayek's political philosophy, as well as cast new light on the weaknesses of limited government "libertarianism" and opened new perspectives in the examination of the emergence of social conventions. His last book, Justice and Its Surroundings, is dedicated to justice and to the issues that typically surround it: freedom, sovereignty, distribution, choice, property, agreement, et cetera. Not only is Jasay's treatment of justice per se original and groundbreaking - further, he provides insightful criticisms of the approaches used by scholars such as John Rawls, Robert Nozick, Brian Barry, and Thomas Scanlon. For any student of political philosophy, Jasay's work is almost a panacea against the philosophical viruses still poisoning European academia. CNE believes that this paper on "loose and strict liberalism" could greatly benefit readers, giving them a theoretical framework to better understand disputes and debates among so-called "classical liberals" and "libertarians". Jasay's paper envisions new solutions to ancient problems, and provides true intellectual excitement. To complement this paper, we also thank Anthony de Jasay for having been so kind as to answer a few questions by CNE Visiting Fellow Alberto Mingardi. MINGARDI: You speak about the loose foundations of classical liberalism, which hasn't been a very "firm" and "strict" political doctrine, but rather an "inclusive"one, an umbrella-political thought under which many different ways of thinking found place. What do you think is the key issue to distinguish between "loose" and "strict" liberalism? The theory of private property? The issue of social justice? DE JASAY: Property and justice are certainly getting different treatments in the two liberalisms, - but I think this is not a primary element of their differences, but rather the consequence of a more fundamental contrast. At the deepest level, the "loose" and the "strict" doctrines differ because the first is value-based, the second logic-based. In loose liberalism, we start from the value we think people should, and do, attach to freedom. But
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being liberals and tolerant, we also leave them freedom of choice: they are certainly entitled to like other values as well, and it is up to them to choose the tradeoffs between rival values that best suit their inclinations. Thus, value-based loose liberalism makes room for "social justice", for equality, for security and any number of other values you can think of. It is a doctrine of tradeoffs; it can be all things to all men as tastes, fashions of thought, forms of political correctness come and go. This is why I keep saying that (loose) liberalism "has a weak immune system". Its weak doctrine leaves it wide open to parasitic invasions ("rightsism") and mutations of identity. Strict liberalism has one cornerstone (you might even say it is its only cornerstone), namely the presumption of liberty, that is not value-based, is subject to no tradeoffs, but is simply a logical consequence of which kind of statement can be falsified and which kind verified. MINGARDI: What are the most relevant theoretical flaws that you notice in contemporary classical liberal / libertarian principles? DE JASAY: For greater clarity, it might be best to put a dividing line between classical liberalism and libertarianism though the division is far from sharp. My feeling is that classical liberalism suffers mainly from one "design fault": along Lockean lines, it accepts the sovereignty of the state because it believes that our "life, liberty and property" can be exempted from this sovereignty. In other words, it tacitly postulates that if we, good liberals, wish government to be limited, it will be limited. I am afraid this is stark nonsense; it is of the essence of government that it is a tool that some people will use to exploit others and by doing so secure the control of government. It is no use to say that government ought to be limited, or that we wish that it should be. (Cf. ch.2 "Is Limited Government Possible?" in my book Against Politics.) Classical liberalism stands or falls with limited government. If I am right that government has intrinsic, built-in features that predestine it to expand and encroach upon the sphere of individual choices, classical liberalism rests upon a falsehood. It is not clear that libertarianism can be accused of the same fault. It does not seem to me that limited government is an inherent element in libertarian theory. If I am right that it is not, libertarianism is in some sense more truthful. It can postulate anarchy. It can also take government as it exists, and postulate opportunistic, step-by-step shavings-off from its scope, - a privatisation here, the repeal of a busybody law there - as part of the libertarian rearguard fight. Putting it differently, the classical liberal sees the state as legitimate but regrettably overstepping its proper limits and hence in need of being cautioned. The libertarian by contrast sees the state not as an errant servant, but as an adversary. MINGARDI: How does the issue of Constitutionalism fit in your distinction between loose and strict liberalism? DE JASAY: In "loose" liberalism, the constitution is an essential ingredient of whichever kind of political order the particular version of liberalism happens to desire. A well-made constitution works rather like the auto-pilot of a passenger plane; it is an automatic device for ensuring that the plane will fly to the destination "we" have fixed for it. Given a good constitution, "we" are safe.
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But of course society is not a unanimous "we". There are many conflicts of interest where "we" confront "them". If these conflicts must be resolved constitutionally, the constitution will become a locus of conflict, - indeed, perhaps, the central locus of most conflicts. It will accordingly be amended, or twisted and turned in interpretation, or circumvented. Its guardian (the Constitutional Court, the Supreme Court) will be unable to resist this; in some periods (the Warren Court) it will be its chief twister-and-turner. The constitution in its logical structure is a vow. Like a vow, it is up to "us" to keep it. It is also like a chastity belt whose key we have within reach. I believe constitutionalism, like its twin brother contractarianism, is a very dangerous strain of thought. It is illusion-mongering. It fosters a belief that we are on auto-pilot and safe from error or selfish deviation by the pilots. In strict liberalism, the constitution is (almost) irrelevant. Since government is not recognised as legitimate, the question of what it may legitimately do does not arise. MINGARDI: Why do you think "pious lies" are so successful in the intellectual environment? Why even so-called free market types do not go for strict liberalism, but rather worship some sort of alternatives, really indistinguishable from a theoretical standpoint from socialist (loose) liberalism? DE JASAY: Pious lies, e.g. the social contract, tell us that things went the way they did because at bottom we wanted them to go that way. The state of affairs has been chosen by a social choice rule that conforms to ethical axioms (e.g. majority rule). Laws are what they are because they maximise the common good, or maximise wealth (as in law-and-economics). A "veil of uncertainty" has made it rational for us consensually to adopt political institutions that in retrospect are proving to be redistributive and disadvantageous. And so on through the whole list of the social arrangements that systematically favour some at the expense of others. Pious lies, in short, serve to reassure us that we are not silly suckers. MINGARDI: You write that, "Despite the logic of the thesis that the state is intrinsically unnecessary, and the attractiveness of ordered anarchy, it is hardly worth the effort to advocate the abolition of the state. But it is worth the effort to constantly challenge its legitimacy". These are inspiring words, but how do you think that this effort to constantly challenge its legitimacy should take place in the contemporary world? DE JASAY: I am agnostic about civil disobedience and taxpayers' strikes. When I speak of challenging the illegitimate state, I mainly mean waging a relentless intellectual battle against the attitude that approves the law because it is the law, because it has been enacted according to the rules. Docility, willing submission to the "lawful government" makes it far too easy for the latter steadily to enlarge its domain of decision. We have reached the stage where almost any policy measure, no matter how outrageous, is accepted as legitimate provided it can be traced to the majority will. Challenging this means hammering home that the measure is outrageous for good reasons despite the majority wanting it (i.e. in practice, despite its being "socially progressive"). As things stand, this is merely a rearguard fight. However, for reasons we cannot really foresee, the tide may turn one day and the rearguard fight may become an advance.
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Liberalism, loose or strict By Anthony de Jasay Political doctrines can be understood and interpreted in many ways, but in order to survive and prosper, each doctrine needs some irreducible, constant element that represents its distinct identity and that cannot change without the doctrine losing its essential character. Nationalism must hold out sovereignty, the safeguarding and if possible the expansion of a territory, a language and a race as the chief goals of policy. If it did not, it would no longer be nationalism but something else. Socialism appears in many guises, but all its versions have at least one common, inalterable feature, namely the insistence that all wealth is created by society, not by individual members of it. Society is entitled to distribute wealth in whatever way fits its conception of justice. Common ownership of the means of production and equality of wellbeing are derivatives of this basic thesis. It is my contention that liberalism has never had such an irreducible and unalterable core element. As a doctrine, it has always been rather loose, tolerant of heterogeneous components, easy to influence, easy to infiltrate by alien ideas that are in fact inconsistent with any coherent version of it. One is tempted to say that liberalism cannot protect itself because its "immune system" is too weak. Current usage of the words "liberal" and "liberalism" is symptomatic of the Protean character of what the names are meant to signify. "Classical" liberalism is about the desirability of limited government and what goes by the name of laissez faire combined with a broad streak of utilitarianism that calls not for limited, but for active government. American liberalism is mainly concerned with race, homosexuality, abortion, victimless crimes and in general with "rights". In mid-Atlantic English, a liberal is what most Europeans would call a social democrat, while in French "liberal" is a pejorative word, often meant as an insult, and "liberalism" is a farrago of obsolete fallacies that only the stupid or the dishonest have the audacity to profess. These disparate usages do not have much in common. It should not surprise us that they do not. Loose doctrine on loose foundations Much of its lack of a firm identity is explained by liberalism's foundations. At its deepest, the doctrine seems to spring from the love of liberty. In more philosophical language, liberty is a value - final or instrumental - that we hold dear. All the superstructure of liberalism is made to rest on this easily acceptable value judgment. However, liberty is not the sole value, - not even the sole political value. It has many rivals; security of person and property, security of subsistence, equality of all kinds, protection for the weak against the strong, the progress of knowledge and the arts, glory and greatness spring to mind, and the list could be virtually endless. Many if not most of these values can only be realised at the cost of curtailing freedom. It is contrary to the liberal spirit of tolerance and love of liberty to try and reject these values and to dispute anyone's freedom to cherish some of them even at the expense of freedom. The love of liberty allows tradeoffs between it and other things. How much freedom should be given up for how much security or equality or any other worthy objective that at least some people want to achieve, is obviously a subjective matter, my value against your value, my argument against yours. Disagreement is legitimate. From this foundation, therefore, the evolution of the doctrine tends towards allowing rival values
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more and more Lebensraum, to incorporate and co-opt them. What surfaces is a variable mish-mash, all things to all men. Utilitarianism and the Harm Principle This evolution, almost predestined by the dependence of the doctrine on value judgments, was pushed further forward by the teachings of the three most influential theorists of classical liberalism, Bentham, James Mill and John Stuart Mill. They made one-man-one-vote and the good of the greatest number into an imperative of political morality, establishing a wholly arbitrary, if not downright self-contradictory, linkage between democracy and liberalism. This linkage has since achieved the status of a self-evident truth. It is being repeated with parrot-like docility in modern political discourse, and is doing much to empty liberalism of any firm identity. They also bear much of the responsibility for endowing liberalism with a utilitarian agenda. Liberal politics became a politics of betterment in all directions. There is always an inexhaustible fund of good ideas for improving things by reforming and changing institutions, making new laws, new regulations and perhaps above all by constantly adjusting the distribution of wealth and income so as to make it yield more "total utility". John Stuart Mill has quite explicitly laid down that while the production of wealth was governed by economic laws, its distribution was for society to decide. Utilitarianism made this not only legitimate, but actually mandatory, for failing to increase total utility by redistributing incomes is to fail doing the good that you could do. A mandate for overall betterment is, of course, a sure recipe for unlimited government. Many defenders of classical liberalism interpret Mill's famous Harm Principle as the safeguard against precisely this tendency of utilitarian thought. The principle looks like a barrier to the state's boundless growth. "...the only purpose for which power can be rightfully exercised over any member of a civilised community against his will" - states Mill - " is to prevent harm to others".1 However, what constitutes harm and how much harm justifies the use of state power, are inherently subjective matters of judgment. There is a vast area of putative or real externalities which some regard as grounds for government interference while others consider that they are simply facts of life, to be left to sort themselves out. The harm principle, being wide open to interpretation, is progressively expanding its domain. Today, omission is amalgamated with commission. "Not helping someone is to harm him"; the harm principle is invoked by certain modern political philosophers to make it mandatory for the state to force the well off to assist those who would be harmed by the lack of assistance. There may well be strong arguments for forcing some people to help others, but it is surprising to find one that is supposed to be quintessentially liberal. Observing the effects of good intentions is often a matter for bitter irony. Locke tried with his innocent-looking proviso to prove the legitimacy of ownership and succeeded in undermining its moral basis. J.S. Mill thought that he was defending liberty, but what he achieved was to shackle it in strands of confusion. 1 J.S.Mill, On Liberty, ch.I., para 9.
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Strict Liberalism In order to prevent it from becoming indistinguishable from socialism, unprincipled pragmatism or just plain ad-hockery, liberalism must become more strict. It needs different foundations, and its structure must be made minimal and simple, so as better to resist the penetration of alien elements. I suggest that two basic propositions, one logical and one moral, suffice to construct a new, stricter liberal doctrine capable of defending its identity. One is the presumption of freedom, the other the rejection of the rules of submission that imply the obligation of political obedience. The Presumption of Freedom The presumption of freedom should be understood to mean that any act a person wishes to perform is deemed to be free - not to be interfered with, regulated, taxed or punished - unless sufficient reason is shown why it should not be free. Some deny that there is, or ought to be, such a presumption2. However, the presumption is not a matter of opinion or evaluation that can be debated and denied. It is a strict logical consequence of the difference between two means of testing the validity of a statement, namely falsification and verification. There may be an indefinite number of potential reasons that speak against an act you wish to perform. Some may be sufficient, valid, others (perhaps all) insufficient, false. You may falsify them one by one. But no matter how many you succeed in falsifying, there may still be some left and you can never prove that there are none left. In other words, the statement that this act would be harmful is unfalsifiable. Since you cannot falsify it - putting on you the burden of proving that it would be harmless is nonsensical, a violation of elementary logic. On the other hand, any specific reason objectors may advance against the act in question is verifiable. If they have such reasons, the burden of proof is on them to verify that some or all of them are in fact sufficient to justify interference with the act. All this seems trivially simple. In fact, it is simple, but not trivial. On the contrary, it is of decisive importance in conditioning the intellectual climate, the "culture" of a political community. The presumption of liberty must be vigorously affirmed, if only to serve as an antidote against the spread of "rightsism" that would contradict and undermine it, and that has done so much to distort and emasculate liberalism in recent decades. "Rightsism" purports solemnly to recognise that people have "rights" to do certain specific things and that certain other things ought not to be done to them. On closer analysis, these "rights" turn out to be the exceptions to a tacitly understood general rule that everything else is forbidden; for if it were not, announcing "rights" to engage in free acts would be redundant and pointless. The silliness that underlies "rightsism", and the appalling effect it exerts upon the political climate, illustrates how far the looseness of current liberal thought can drift away from a more strict structure that would serve the cause of liberty instead of stifling it in pomposity and confusion. 2 Notably Joseph Raz, The Morality of Freedom, Oxford 1986 , The Clarendon Press, pp.8-12
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The Rule of Submission "The king in his council has expressed his will, and his will shall be obeyed by all" is a rule of submission. So are the rules that required the citizens of Venice to obey the Signoria, that gave the power to make laws to a majority of a legislature and the power to elect legislators to a majority of voters. The latter of these rules are more "democratic" than the former, but they all share the same essential feature: the obligation of all in a community to submit to the decisions of only some of them. Moreover, every such rule imposes the obligation to submit to decisions reached by certain persons in certain ways so to speak in advance, before knowing what those decisions are in fact going to be. Reasons of practical expediency can be found why this must be so if the business of government is to be transacted. The reasons may be good ones, but the rule they call for is no less outrageous for all that. Submission can be morally acceptable if it is voluntary, and voluntary submission by rational individuals is conceivable on a case-by-case basis, on the merits of particular propositions. As a general rule, that amounts to signing a blank cheque, however, it can hardly be both voluntary and rational. If a general rule of submission is necessary for governing, - which it might well be - then the legitimacy of government, any type of government, turns out to be morally indefensible. Does this mean that strict liberals cannot loyally accept the government of their country as legitimate, and are in effect advocating anarchy? Logically, the answer to both questions must be "yes", but it is a "yes" whose practical consequences are necessarily constrained by the realities of our social condition. Orderly social practices that coordinate individual behaviour so as to produce reasonably efficient and peaceful cooperation, can be imposed by law and regulation. Today, many of our practices are in fact so imposed, - many, but not all. Some important and many less vital yet useful ones are matters of convention. Unlike a law that must rely on the rule of submission, a convention is voluntary. It is a spontaneously emerging equilibrium in which everybody adopts a behaviour that will produce the best result for him given the behaviour that he anticipates everybody else to adopt. In this reciprocal adjustment to each other, nobody can depart from the equilibrium and expect to profit from it, because he will expect to be punished for it by others also departing from the equilibrium. Unlike a law that depends on enforcement, a convention is thus self-enforcing. Its moral standing is assured because it preserves voluntariness. David Hume was the first major philosopher systematically to identify conventions in general, and two particularly vital conventions, that of property and of promising in particular. Hayek's fundamental idea of the "spontaneous order" can best be understood in terms of conventions. We owe the rigorous explanation of the self-enforcing nature of conventions to John Nash, and more recent developments in game theory show that conflict-ridden social cooperation problems formerly believed to be "dilemmas" requiring state intervention, in fact have potential solutions in conventions.
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The Strictly Liberal Agenda It is easy to describe plausible scenarios in which spontaneous conventions emerge to suppress torts and protect life and limb, property and contract3. However, such scenarios are written on a blank page, whilst in reality the page is already covered with what the past has written on it. In the West, at least two centuries of ever more elaborate legislation, regulation, taxation and public services, - in short, recourse to the rule of submission - have bred a reliance on the state for securing social cooperation. Society has therefore less need for the old conventions, and its muscles for maintaining old conventions and generating new ones have atrophied. In the face of this reality, it is probably vain to expect the collapse of a state to be followed by the emergence of ordered anarchy. The likeliest scenario is perhaps the emergence of another state, possibly nastier than its predecessor. This limits the practical agenda of strict liberalism. Despite the logic of the thesis that the state is intrinsically unnecessary, and the attractiveness of ordered anarchy, it is hardly worth the effort to advocate the abolition of the state. But it is worth the effort constantly to challenge its legitimacy. The pious lie of a social contract must not be allowed to let the state complacently to take the obedience of its subjects too much for granted. There is a built-in mechanism in democracy for the state to buy support from some by abusing the rule of submission and exploiting others. Loose liberalism has come to call this social justice. The best strict liberalism can do is to combat this intrusion of the state step by step, at the margin where some private ground may yet be preserved and where some public ground may perhaps even be regained. 30 October 2003 3 Cf. Jasay, Against Politics, London 1997 , Routledge, Ch.9 , "Conventions: Some Thoughts on the Economics of Ordered Anarchy".

Posted by maximpost at 12:51 AM EDT
Permalink
Monday, 30 August 2004

UK WATCH - HOT DOCUMENT?
http://www.globalsecurity.org/wmd/library/news/iraq/2004/08/a_case_to_answer_impeach-blair_26aug04.pdf

>> HAMAS? HERE?

More Alleged Hamas Operatives Linked to DC-Area Think Tank
By Scott Wheeler
CNSNews.com Staff Writer
August 26, 2004
(CNSNews.com) - The Virginia man recently detained after his wife was seen videotaping Maryland's Chesapeake Bay Bridge has ties to a Springfield, Va., Muslim think tank that is an alleged front for the terrorist organization Hamas.
The think tank, the United Association for Studies and Research (UASR), is located just fourteen miles from the U.S. Capitol. Counter terrorism analyst Peter M. Leitner has described UASR as one of the "phony organizations that are really terrorist cells [and] part of the international terrorist network." UASR has been the subject of a CNSNews.com investigation since March.
Ismael Selim Elbarasse and his wife were spotted in their SUV by two Baltimore County, Md., police officers on Aug. 20. Elbarasse's wife was reportedly videotaping the 4.3 mile Chesapeake Bay Bridge, the main span that connects Maryland's Eastern Shore to the Baltimore, Washington D.C., metropolitan area.
"At the toll plaza, the Baltimore County officers reported what they had seen to Maryland Transportation Authority Police. Its officers stopped the SUV west of the bridge and confiscated the camera," the Baltimore Sun reported. The Elbarasses, accompanied by two children, had reportedly been seen trying to hide the camera, before it was taken by police. The camera showed that close-up images, "atypical for a tourist," had been videotaped, according to the Sun.
It's unclear whether the incident was a so-called "probing attack," efforts by potential terrorists to conduct surveillance and compile information about vulnerable American targets. Hundreds, if not thousands of probing attacks have taken place all over the United States since the Sept. 11, 2001 terrorist strikes on New York City and the Pentagon, according to counter terrorism experts.
Following the confiscation of his camera, Elbarasse was reportedly taken into custody as a material witness for a case involving the federal indictments of three men allegedly linked to Hamas.
The indictments were unsealed in Chicago on the same day Elbarasse was detained and list Elbarasse as a "high ranking Hamas leader" and an un-indicted co-conspirator in an operation that U.S. Attorney General John Ashcroft described as a U.S. based, "terrorist recruiting and financing cell" for Hamas.
CNSNews.com previously reported on the connections that two of the men indicted -- Mousa Abu Marzook and Mohammad Salah -- have to UASR. Internal documents obtained also link the third man indicted -- Abdelhaleem Hasan Abdelraziq Ashqar - and Elbarasse to UASR.
Ashqar worked at the UASR office in Springfield, Va., as a "research associate" in 1998, according to a source who did not want to be identified. A June 1999 document making direct reference to Ashqar at the UASR office in Springfield was also obtained by CNSNews.com .
Elbarasse, who served eight months in a New York prison in 1998 for refusing to testify to a grand jury investigating terrorism, was seen on a regular basis and photographed by CNSNews.com at UASR's Springfield, Va., office between April and early August when UASR moved files to an undisclosed location and appeared to be shutting down its identifiable operations. UASR records that included Elbarasse's contact information while he was in prison in New York State were also obtained by CNSNews.com .
Leitner, managing director for Criterion Strategies, a New York City based counter terrorism and emergency response company, said the videotaping incident involving Elbarasse is disturbing.
"When the U.S. invaded Iraq, both Hezbollah and Hamas avowed to bring terrorism to the United States, as a reprisal for the invasion of Iraq. Then we have (Jamal) Akal, (subject of a July 23 CNSNews.com report) the guy who was arrested in Israel, saying he was part of a new Hamas organization that was specially designed to target in North America," Leitner said.
"Now we have Elbarasse, engaged in operational activities in North America, the Chesapeake Bay Bridge, a very big strategic choke point, a spectacular target. And he is part of UASR, which shows the quickness and the ease with which a support cell, the fundraising, propaganda and recruitment cell of Hamas, can become an operational cell," Leitner added.
"There is no real demarcation between support cells and operational cells. When they get the call, they become operational," Leitner said.
Stanley Cohen, an attorney for Elbarasse, told CNSNews.com that the videotaping of the Chesapeake Bay Bridge was a benign activity and that Elbarasee's wife had also videotaped the Grand Canyon and Ft. Lauderdale Beach in the past..
"She is an inveterate video taper," Cohen said. If Elbarasse's wife "had blonde hair and blue eyes and her name was Rosie, it would have been no problem," Cohen added. However, "it became a crisis," he said, because Elbarasee's wife "had a hajib on and they are Palistinian or Muslim."
Cohen initially said Elbarasse's links to UASR amounted to "nothing," then added that his client stored "about thirty boxes of books" in his garage when UASR ran out of room during its "downsizing."
Cohen also said he could not rule out the possibility that Elbarasse had performed accounting services for UASR.
Tuesday, CNSNews.com sought comment directly from Elbarasse at his home in Annandale, Va. Elbarasse's wife said the family would have nothing to say and referred the news organization to Cohen.
According to a Justice Department press release regarding the federal grand jury indictments in Chicago, "Abu Marzook and Ashqar, together with Elbarasse and other unnamed co-conspirators, allegedly used various accounts at banks in such places as Cleveland, Milwaukee, New York, Louisiana, Mississippi and Virginia, to transfer amounts ranging from tens to hundreds of thousands of dollars at a time into the United States from various sources abroad, including Saudi Arabia and Switzerland and then between banks in the United States before transferring funds out of the country" to finance Hamas activities in Israel.
Marzook founded the UASR and later left the U.S. to become a leader of Hamas. He is currently believed to be in Syria and the Justice Department now considers him a fugitive.
The last known executive director of UASR is Ahmed Yousef, who has repeatedly refused to return telephone calls seeking comment for articles related to the CNSNews.com investigation.
The UASR office telephone number in Springfield, Va., was recently disconnected. Yousef, according to sources close to UASR, has been out of the country for several months and is believed to be in Algeria.
Muhammad Salah, another of the men indicted on Aug. 20 and a U.S. citizen, was arrested in Israel in 1993 for helping to organize terrorist attacks for Hamas. Salah reportedly told Israeli interrogators that the Hamas operation in the U.S. was based at UASR and that Ahmed Yousef was its leader.


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US Companies Providing Indirect Service to Terrorist Websites, Report Says
By Julie Stahl
CNSNews.com Jerusalem Bureau Chief
August 27, 2004
Jerusalem (CNSNews.com) - American Internet Service Providers are being used indirectly by the Palestinian Islamic Jihad and other terrorist groups to market their terrorist messages, Israel's Intelligence and Terrorism Information Center at the Center for Special Studies said in a report this week.
But following an inquiry by CNSNews.com into the allegations, two of the companies listed in the report said they were now in the process of correcting the situation.
"Palestinian and international terrorist organizations make massive use of the Internet to spread propaganda supporting terrorism and as a means of maintaining contact between organizations and headquarters, their infrastructures and their target populations," the report said.
As a case study, the report lists six separate websites belonging to the Palestinian Islamic Jihad, at least four them hosted by two different American Internet Service Providers.
The Palestinian Islamic Jihad appears on State Department's list of terrorist organizations as well as on the European Union's list of terror groups.
According to the report, the sites - all in Arabic - contain various messages; archival material about the group's activities (including terrorist operations); publication of books and articles sponsored by the Palestinian Islamic Jihad; "encouragement of terrorism against Israel and praise for the suicide bombers"; and some websites support armed insurrection to "liberate all of Palestine" (including Israel, the West Bank and Gaza Strip) and establish of an Islamic state there.
"Insofar as can be verified, the organization's Internet infrastructure is supported by Western companies located mainly in the United States," the report said.
Preference for U.S. and Western companies provides terror groups with "advanced technological support," the ability to "disappear" among the multitudes of Western companies on the World Wide Web -- and to a certain extent, allows protection under U.S. freedom of speech guarantees, the report adds.
Alerted by journalists inquiring about the report, Level 3 Communications, a Colorado-based ISP listed in the report, said it does not provide services to the Palestinian Islamic Jihad, but one of the companies to which it sells its services does.
"Level 3 does not sell services to the PIJ, contrary to the statements made in the recent report by the Intelligence and Terrorism Information Center," said Arthur Hodges, vice president of communications at Level 3 Communications, told CNSNews.com.
"Level 3 operates one of the largest Internet backbones in the world, and the company's network carries a substantial percentage of the world's Internet traffic every day," he added.
According to Hodges, the company sells services on a wholesale basis to a wide variety of communications service providers, including ISPs and web-hosting companies. Level 3 is not a retail ISP, nor does it provide web-hosting services, he said.
Hodges said Level 3's global security department conducted an investigation after the Intelligence and Terrorism Information Center issued its report. "The investigation determined that a U.S. company that buys services from Level 3 was an underlying provider of hosting services to some of the web sites identified in the report," he said.
"Level 3 alerted its customer; the customer conducted its own investigation into the matter and has indicated it will decommission the web sites," he said.
Deborah Barnett, director of communications at the Maryland-based Alabanza, another ISP mentioned in the report, said the sites in question involving her company are "under active review." The company has a strict policy against illegal and inappropriate materials posted on websites that it hosts, she said.
"We do have an acceptable-use policy and a highly advanced Information Technology division that checks as best we can for compliance of websites hosted by Alabanza," Barnett said in a written response to CNSNews.com.
"In addition to illegal activities, we also take action against a site if it promotes pornography, trademark [or] copyright infringements, or threatening material," she said.
Alabanza also has an "extensive network of resellers" in nearly every country worldwide, Barnett said. "While it's impossible to check content on every site that we host, we do have two people who work full-time on nothing but these compliance issues," she said.
"We take all complaint notifications seriously, and we review these sites manually. When appropriate, we contact authorities and work with them as required," she added.
According to Barnett, last year the company shut down a site called "whoseajew.com" after receiving a complaint about it.
"After reviewing the content, we felt that providing identities and locations of individuals practicing the Jewish faith was blatantly anti-Semitic and could potentially threaten their well-being," she said. "We shut the site down immediately. We have no tolerance for such activities."
Gray Area
Service agreements such as that between Alabanza and its customers enable companies to close down websites even if they are not technically illegal, said Brian Marcus, director of Internet monitoring for the Anti-Defamation League in New York.
Laws governing the posting of terrorism-related material on websites fall into a "gray area," he said.
"You can put up a site that's generally supportive of terrorism," he said, because it falls under the First Amendment, freedom of speech. A person could say, "I like Hamas" and even quote inciting words of a radical leader and still be within his rights, he added.
Where the law can begin to get involved is in cases such as that of a student in Idaho who was charged with creating websites that attempted to raise funds and was directly linked to terrorist organizations, Marcus said in a telephone interview.
Another "gray area" is that of issuing threats, which must be both "specific and credible" to come under investigation, he said.
Marcus pointed to the case of Babar Ahmad, who published two pro-Jihad (Islamic holy war) websites, one of them linked to Chechen terrorists. It gave explicit instructions on how to raise money and sought material support for terrorism. While Ahmad is in England, the computer with the material is physically in the U.S. and therefore the U.S. is trying to extradite Ahmad, he said.
But if companies are concerned - which most are - Marcus said, they can get around the issue of whether something is legal by enforcing the terms of their service agreements and taking websites off their servers for breaking company rules.
"[Most] companies don't have the time or the expertise to go into all the websites [they host]," said Marcus. But if a company is notified by a concerned party and discovers a client has broken the rules of service, the company will usually remove the web site immediately, he added.
Nevertheless, he said, terrorist groups are getting "much more sophisticated" in their use of the Internet, using it to "spread knowledge."
What groups have discovered, he said, is that if they send videos of executions or terror attacks to Arabic or other television networks, the material will be edited or censored; but if they post it on a web site it goes out to the public "uncensored [and] unfiltered," such as the recent grizzly beheadings of kidnap victims in Iraq.

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Europe's Iran Fantasy
Europeans are from Venus, Mullahs are from Mars.
by Leon de Winter
09/06/2004, Volume 009, Issue 48
Amsterdam
ON OCTOBER 22, 2003, the Guardian, a leading British newspaper, carried no fewer than three articles about the remarkable events in Tehran the day before. The foreign ministers of the three leading European Union countries--Britain's Jack Straw, France's Dominique de Villepin, and Germany's Joschka Fischer--had flown to Iran to try to persuade its Shiite leaders to conclude an agreement about Iran's nuclear program.
The first was a news story, under the headline, "E.U. ministers strike Iran deal." The lead began, "Three European foreign ministers claimed a diplomatic coup yesterday, securing an agreement from Iran over its nuclear program which could defuse a brewing crisis with the U.S." Central to the agreement was a commitment "to suspend [Iran's] uranium-enrichment and reprocessing activities"--in other words, to halt production of materials for nuclear weapons.
The second article was by Guardian commentator Ian Black, who wrote: "The agreement marks a significant victory for the European Union's policy of 'conditional engagement' and the use of carrots and sticks, in contrast to threats from the United States against the Islamic republic, part of President George Bush's 'axis of evil.' . . . 'We often find ourselves on the defensive, being told we are appeasers for engaging with regimes like this,' an E.U. diplomat said last night. 'This agreement gives the lie to that argument. Clearly the Iranians did not do this because they feared E.U. military action. They did it because they want a relationship with us and want to keep channels open.'"
The Guardian's third piece about this triumph of European diplomacy opened as follows: "Iran's agreement to allow unlimited U.N. inspections of its nuclear facilities and to suspend its uranium enrichment program marks a tremendous success for European diplomacy. . . . Mr. Straw played down the significance of the achievement. He should not be so modest. . . . Iran will doubtless remain an axis-of-evil rogue state in George Bush's florid lexicon. But Washington must not try to undermine this accord. To date, [Washington's] polarizing, aggressive pressure tactics have mostly made a difficult problem worse. Europe demonstrated yesterday that there is a different, more effective way. And it is not the American way."
These articles were typical of those then appearing in the European press about the success of European soft power. Few commentators could resist the opportunity to malign Bush, even though many realized that Iran had no intention of adhering to the agreement. The warnings and reports by the International Atomic Energy Association, then and since, make it clear: Everything that happened on that fall day in Tehran was fiction and deception. Yet Europe's leading politicians chose to deceive and debase themselves rather than recognize Iran's play-acting for what it was. For them, the illusion of soft power was infinitely preferable to the suggestion that they should be prepared to prevent Iran from becoming a nuclear power at all costs. The Iranians knew perfectly well that the Europeans would not back up their demands with force--the only language tyrants building nuclear arsenals understand. The mullahs are quite familiar with Europe: The life-loving Europeans of the third millennium would never have sent their children into the minefields of Iraq.
All but a handful of Europe's politicians, obsessed by the specter of electoral defeat, refuse to take a stand if doing so could force them to sacrifice lives. Post-historical and post-religious Europe, born in the shadow of the Holocaust, does not see sacrifice as legitimate. Of course, considering that Europe has nurtured some of the world's cruelest ideologies, the dread of scenarios that might require sacrifice is hardly surprising. The problem is that much of the world, especially the Arab Islamic parts of it, is simply not interested in the moral and ethical implications of Europe's bloody past.
Since Auschwitz--the benchmark of ideological and political developments in Europe--the miracle of European prosperity and freedom has not led to the conviction that this prosperity and freedom must be defended, if necessary by force; on the contrary, the miracle has given birth to an attitude of cultural relativism and pacifism. It is as if modern Europe had divested itself of its idealistic and historical context, as if many Europeans saw the miracle of a prosperous and free Europe as an ahistorical, natural, and permanent state of affairs--as if Auschwitz had been wiped from their memory.
But anyone who is ignorant of, or ignores, the fact that tens of millions of Europeans died in the twentieth century in the struggle between good and evil--and it seems most Europeans have simply forgotten this--will fail to appreciate that the continued existence of Europe's system of liberal moral and ethical values is the result of conscious choices by courageous Europeans (and many others).
It may be something worse than amnesia: Today's Europeans may see the history of the twentieth century as scarred only by an abstract process known by the ancient Germanic word "war," a concept that for them represents some monstrous destructive force beyond good and evil that blindly spews out victims, like a flood or a hurricane. Most Europeans no longer regard Auschwitz as the disastrous result of evil ideas and the evil decisions of human beings. Instead, they see it as the consequence of something more like a natural disaster.
Perfectly expressing this concept of war were the huge demonstrations in Europe against the war in Iraq. In these rituals, the term "war" was taken out of its historical, political, and cultural context, and no justification for fighting was deemed acceptable. The high priest of this antihistorical creed is Michael Moore, who, 59 years after the end of the Second World War, in a discussion with TV talk show host Bill O'Reilly, would not state categorically that only a devastating war could have saved Europe from something far worse, namely Nazism. By these lights, war is bad whatever the historical or political circumstances.
Another manifestation of the same kind of thinking is the antihistorical view of the suffering caused by the Allied bombing of Nazi Germany: Germans increasingly see themselves as victims of "the war," as if the conflict were not a consequence of the German people's national obsessions with race and purity. A recent German novel about the Allied bombing enjoyed a succ?s de scandale because it purposely left out any reference to historical context. Everyone is a victim in war, was the message, and the difference between good and evil disappears when the dogs of war are unleashed. "Ordinary Germans" were victims too.
The European landscape is littered from north to south and east to west with monuments to battles and massacres. Many of them commemorate distant conflicts that now are hard to understand, but some mark the struggle against the most recent European evils: the right-wing totalitarian fascism of Nazi Germany and the left-wing totalitarian fascism of the Soviet Union. Although carved in stone, their lessons have not been learned. For most Europeans, the monuments no longer speak to Western civilization of the essential choice between good and evil. Instead, the memorials to the millions who died, from American soldiers to murdered civilians, stand for a faraway world that today's European, safe in his postmodern cultural relativism, thinks he has long since left behind: a world as distant as the Ice Age, plagued by an abstract phenomenon called "war."
It was only logical, therefore, that the implosion of Yugoslavia in the 1990s, which threatened to generate yet more massacres and monuments, left Europe paralyzed. Europe had to bring an end to the mass killings of Europeans by other Europeans in the Balkans, but it lacked the ability to take the necessary action. For that, Europe needed the detested United States.
Of course the horrors of war are beyond comparison, and it is a mark of civilization to deploy military force only with extreme caution. But most Europeans no longer realize that to avoid taking a path that may in the end lead to violent conflict--to avoid opposing totalitarian ideologies--can result in even greater suffering and more casualties. Today's Europeans seem unable to accept the idea that bowing to tyranny is sometimes worse than going to war to resist it. Indeed, to judge from the way European appeasers have handled the threat of a potential Iranian nuclear bomb, it seems that Europe would rather accept its own demise than sacrifice its sons to the dogs of war, which make no distinction between good and evil.
Last month the Brookings Institution hosted a conference of former American and European politicians and bureaucrats on the danger of the Shiite bomb. Newsweek quoted Madeleine Albright as commenting: "Europeans say they understand the threat but then act as if the real problem is not Iran but the United States."
It is remarkable that current developments in Iran do not dominate our headlines. The media are obsessed by Abu Ghraib, by those "liars" Sharon and Bush, by Halliburton and the neocons. And their obsession extends to conspiracy theories, although they fail to realize that something must be wrong when a radical pacifist like Michael Moore can receive the best film award at Cannes from Quentin Tarantino, a man who has done more than anyone to glamorize violence. In the meantime, a terrifying danger looms on the horizon, set to transform the geopolitical map of the Middle East within two years and so the map of the entire world: the Iranian nuclear bomb.
The mullahs are quite frank about why they want nuclear weapons. On December 14, 2001, the de facto dictator of Iran, Ali Akbar Hashemi Rafsanjani, spelled out his dream in a sermon at Tehran University. "If one day the world of Islam comes to possess the [nuclear] weapons currently in Israel's possession," Rafsanjani said, "on that day this method of global arrogance would come to a dead end." This, he said, is because the use of a nuclear bomb on Israel would entirely demolish the Jewish state, whereas it would only damage the Islamic world. Iran's leaders have made dozens of similar statements.
Last week Israel's senior commentator Zeev Schiff wrote in the Israeli newspaper Haaretz: "There is an impression that Iran has no fears of any United Nations Security Council action. If its audacity succeeds, Iran will gain another period of unhindered nuclear development. Even though the Iranians have been caught out in the lies they have been weaving for 18 years, it is possible the ayatollahs' regime in Tehran believes that time is on their side."
What happened in Tehran on October 21, 2003, was not proof of the viability of soft power, but the opposite--proof of its impotence. The Guardian and the rest of the European media were fooling themselves and us, blinded by their hatred of Bush's hard power. "Washington sought to persuade Western allies to take a tougher line on Iran," Haaretz wrote last week, concluding dryly, "But Britain, Germany, and France say they prefer to try and persuade Tehran to cooperate with the International Atomic Energy Agency." They never learn.
Leon de Winter is a Dutch novelist and columnist for Elsevier magazine, Holland's premier political weekly. He is also a contributor to German publications like Die Zeit, Der Spiegel, and Die Welt, as well as an adjunct fellow at the Hudson Institute.
? Copyright 2004, News Corporation, Weekly Standard, All Rights Reserved.

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Latest Iranian missile has upgraded warhead
By Ze'ev Schiff, Haaretz Correspondent
The warhead of the Iranian Shihab 3 missile has been considerably upgraded, according to photographs published in Iranian newspapers of test launches three weeks ago. It is believed that the improvements will permit slower entry into the atmosphere so the warhead, which may be chemical in nature, will be more durable and its contents will be better protected. It is also believed that the missile's range has been extended.
The operational and technological conclusions from the changes in the missile indicate that the Iranians are not resting on their laurels in developing their surface-to-surface missiles, and have shown a daring approach to their technological planning. It is very likely that the Iranians are being assisted by foreign experts from the former Soviet Union hired by Iran under personal contracts, or by experts from North Korea.
It is also likely that the Iranian effort is not limited to the Shihab 3, which has a range of about 1,300 kilometers, but also to the Shihab 4, planned with a range of 2,000 kilometers or more. At present the Shihab 3 can already come within range of Turkey, which is a member of NATO, as well as most Saudi cities and oil fields. On the last test of the Shihab 3 on August 11, the missile did not pass the maximum trajectory that had been determined for it.
The Iranians gave the experimental launch extensive media coverage, stressing that the test was a response to an Israeli experimental launch of the Arrow missile, which intercepted a Scud missile in the U.S. at the end of July.
It subsequently turned out that the reported success of the Shihab's launch was intended to camouflage a failure in the missile's flight early in the launch.
However the photographs published by the Iranians show several new details. In addition to the new warhead, the missile was fired from an operational vehicle and not from an ordinary surface launcher. In all the other Shihab 3 tests, the warhead was cone-shaped, but this time it has a new, flatter shape and appears to have various short wings.
Experts from various countries are expected to analyze the technological and operational aspects of the new form of the Shehab 3. It is especially interesting to several European countries, which understand that the day is not far when Iranian missiles will be within range of a considerable portion of Europe.
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Iran plays down US mud-slinging ahead of IAEA board meeting
IRNA - Islamic Republic News Agency
Tehran, Aug 29, IRNA -- Iran Sunday put a brave face ahead of an IAEA board of governors` meeting in Vienna, saying it was confident the country`s nuclear dossier would not make a case for examination at the UN Security Council. Tehran is bracing for the International Atomic Energy Agency (IAEA)` report, due to be released at a September 13 meeting of the agency`s board of governors. "We don`t think the (International Atomic Energy) Agency`s report will be such that it gives a pretext for referral of Iran`s file to the Security Council," Foreign Ministry spokesman Hamid Reza Asefi told a weekly news briefing. The official said most outstanding questions about Iran`s nuclear program had been resolved, but the Americans were sure to come ahead with new `peripheral issues`. "Experience has shown that America raises up one peripheral issue each time ahead of the meeting, like the previous meeting where they raised up the `Shiyan` issue," he said, referring to US allegations that Iran had razed an alleged nuclear site in Lavisan near Tehran to remove evidence. Asefi said Iran has allowed IAEA inspectors to visit the site and take samples. The report, being written by IAEA Director General Mohammad ElBaradei, will review the agency`s progress in clearing up questions about Iran`s nuclear activities. Earlier this month, diplomats familiar with Iran`s nuclear dossier, were reported in Vienna as saying that new findings on Iran by the UN atomic agency appeared to strengthen Tehran`s claim it has no enriched uranium domestically. They said reported findings could hurt renewed US hopes that its allegations could translate into support for referral of Iran to the UN Security Council. Most suspicions focus on the sources of traces of enriched uranium and the extent and nature of work on the advanced P-2 centrifuge, used to enrich uranium. According to diplomats in Vienna, the IAEA`s new findings bolster Tehran`s assertion that all traces of enriched particles found in Iran were inadvertently imported on contaminated equipment it bought on the black market. Asefi said, "With the clarification of the issues such as P-2 and uranium enrichment as well as contamination of components and other marginal issues, all ambiguities have been answered." "If the Americans do not bring forth a new marginal issue, there is no reason for Iran`s nuclear file not to be put on a normal course," the Foreign Ministry spokesman added. "If what has come to pass between us and the agency is carefully reviewed, it will become evident that our cooperation with the agency has made a good progress. In the same breath, the agency`s report must show progress," he said. In what has been described as a confidence-building measure, Tehran has voluntarily suspended uranium enrichment and manufacture of centrifuge components. Moreover, the Islamic Republic has signed an additional protocol to the nuclear Non-Proliferation Treaty (NPT), allowing snap inspections of its nuclear activities. Asefi turned the tables on French President Jacques Chirac who has reiterated the need for confidence-building on Iran`s side. "We assure Chirac and others that we want confidence-building, but in this process, our right of access to peaceful nuclear technology must be respected," he said.
Iran says its nuclear program is in accordance with the country`s bid to produce 7,000 megawatts of electricity in the next 20 years, when the country`s oil and gas reserves become overstretched. The country has cooperated closely with the European `big three` -- Germany, France and Britain -- to answer outstanding questions about the country`s nuclear program. Asefi said, "America has always made illogical demands, but we are not worried and we will not give up our legitimate right of having access to peaceful nuclear technology." 2323/1412
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Boom - or bomb?
By Zvi Bar'el
HAARETZ
Iran's actions depend on the number of vacationers on the island of Kish no less than on its relations with Washington and the battles in Najaf.
Iranian Defense Minister Ali Shamkhani preferred to be interviewed for the Al-Arabiya television network this week in Persian. It is possible that had he spoken in the other language in which he is fluent, Arabic, there would have been no need for translation and there would have been no call for "clarifications" concerning how his remarks were taken out of context. According to the translation, Shamkhani said, more or less, that his country would not sit by idly and do nothing in light of the possibility that the United States might attack it. The meaning of this is that Iran will preempt an attack by American forces.
"This is not what the defense minister said," clarified the Iranian Defense Ministry spokesman, Hamid Reza Assafi. "His remarks were not understood properly."
Shamkhani, according to the spokesman, said that Iran would defend its national interests. Translation problems are a convenient way out for statesmen and military people who are caught saying things that they meant to say, but that should not be said. The interesting aspect of Shamkhani's remarks may be, in fact, the effort to correct the impression they made, because since when has Iran retreated from a threat that it has made? Especially toward the United States?"
But this is not the first time this month that Iran has made an effort to put on a pleasant face. When Iraqi Defense Minister Hazem Sha'alan declared two weeks ago that Iran is Iraq's biggest enemy, and that Iran was infiltrating foreign agents and terrorists into Iraq, the Iraqi charge d'affaires in Iran was summoned for clarifications and was asked to show evidence for the minister's claims. Two days later, the director general of the Iraqi Foreign Ministry, Hamed Biati, stated that, "Iran is a neighboring country and helped the Iraqi opposition for years prior to the toppling of Saddam Hussein." The defense minister's remarks "do not represent the government," said the director general of the Foreign Ministry.
The balance of power within the Iraqi government, and the way appointments are distributed accordingly, allow the director general of the Foreign Ministry to contradict the defense minister's statement, but this is not the point. Iraq does not want to get into a conflict with Iran, and the latter wants to look like a good neighbor - a neighbor that claims to want to meet with the prime minister of Iraq, Iyad Allawi, in order to straighten things out. Yet, according to Allawi, he has not yet been sent an official invitation.
This is an Iran that is taking care to portray itself as having helped the U.S. in the war against the Taliban and is, at the same time, refusing to hand over Al-Qaida activists for questioning in their countries of origin or to the U.S. But there is one area in which Iran is not concealing information: It has long-range Shihab 3 missiles, which were successfully tested recently, it has nuclear installations and it is continuing to enrich uranium - but all "for peaceful purposes."
Two threats
In an interview that Shamkhani gave to The Los Angeles Times in 1998, the minister stated that Iran has a "natural right" to develop sophisticated weapons systems, because Iran is a threatened country. He said that there are two major threats facing his country: the foreign presence, and especially the American presence, in the waters of the Persian Gulf, and the extremist-nationalist movements in the Caucasian republics. The U.S. can eliminate at least one of these threats, he said, and take its army out of the Gulf.
He added that the Iranians had never started a war against anyone and they would not do so in the future, but they could not forget the lesson learned from the war with Iraq that exacted from them thousands of terrible casualties. These two threats, said Shamkhani at the time, meant that the Iranian army would have to deploy along a number of fronts: one on the Gulf, a second along the border with Afghanistan and a third in the north of the country.
Israel, in that interview, was mentioned only as a secondary threat, and Shamkhani asked why there were complaints about Iraq when Israel was equipping itself then with F-15 aircraft with a range of 4,000 kilometers, and why Israel can develop nuclear weapons while Iran is not allowed to do so.
For more than a year now Iran has found itself next to a new threatening neighbor. The U.S. presence in Iraq is a change in the strategic status quo that Iraq had known since the end of the Iran-Iraq war in 1988. There are too many American forces, too many threats to Iran coming from the Pentagon and Israel, and too few real allies. Iran, it is often said in the Gulf states, is a country without enemies and without friends, in a league by itself. In Iran, however, this formula is not accepted.
"Iran perceives itself as a country that is surrounded by enemies, but without friends," says an expert at a Turkish research institute who specializes in Iranian affairs. "There is no country in the world that has a close relationship with Iran on the model of the relationship between the U.S. and Israel, or the relationship among the NATO countries, or of even the loose relationship among the countries of the Arab League. It is true that nowadays every Arab state can declare that it does not have Arab backing, but there is a sense of commitment. When I speak to Iranian politicians, and even reformists, they say that if Iran does not look after itself, no one will."
How tightly can Iran stretch the rope, and what exactly is that rope? Iran is posing two challenges to the U.S.: its involvement in Iraq, and the infrastructure it has that could develop nuclear weapons in the near future. From conversations with American diplomats, the impression emerges that Iran's involvement in Iraq is worrying the U.S. more than the potential for the development of nuclear weapons. An American diplomat who is serving in a neighboring country says that "Iran is liable to turn Iraq into a theocracy. It is an element that is stirring ferment, [Iraqi Shiite leader] Muqtada al-Sadr is drawing strength from it, and the border with Iran is porous and there are no efforts being made on its part to seal it against the entry of terrorists of any sort."
America's fears
The political fear in Washington is that it is not enough that the war in Iraq looks endless and that it is impossible to show any real achievement before the presidential elections on November 2, but also that it is Iran that is raking in the profits in the meantime. The Muqtada al-Sadr affair is perceived as an Iranian challenge and not just as a local challenge - but more than that, the oil prices that have soared to record highs this month are good for Iran's budget. The past fiscal year, which ended in March 2004, indicated a growth rate of 6.7 percent and this year it will apparently be even higher because of the oil prices.
But this is not the only impressive figure. For four years now Iran has been experiencing economic growth. Its balance of trade is in a surplus, its debts are paid, its foreign currency reserves come to approximately $35 billion and, according to foreign reporters who have visited Iran recently, there is an atmosphere of flourishing business in the country. The Turkish Turkcel telecommunications company won an approximately $2-billion tender to set up a cellular telephone infrastructure that will compete with the government company; another Turkish company has won and completed the tender to build Tehran airport; the Peugeot company has signed an agreement to assemble cars in Iran that will also be exported from there to Eastern Europe; a consortium of German companies, Deutsche Chemie, is slated to set up a huge tourism project on the Iranian island of Kish and compete with Dubai's huge share of the tourism market; and the Internet network is spreading to more and more homes and businesses. It is doubtful that the Iranian regime will want to subject this economic prosperity to an American threat.
The interesting thing, in fact, is that when the parliament is again in conservative hands (since the elections in February of this year), spiritual leader Ayatollah Ali Khamenei can show economic achievements, development and growth, and thus garner political power in advance of the presidential elections that will be held next summer. It will be difficult for President Mohammed Khatami and the liberals to depict these achievements as their own next year. Thus, if no dramatic change occurs in Iran, there is a fear that the presidency - after the Parliament and the local authorities - will return to conservative hands. The war with Iraq, which was supposed to changed the balance of power within Iran as well and get rid of another part of the so-called axis of evil, could well turn out to have strengthened the conservative regime there even more.
But this is also a problem for the conservative elements in Iran. They have to sustain their success, and when their country is threatened by the U.S., even the most enthusiastic investors have difficulty going there. One means to relieve the international pressure that Iran has employed successfully is to hold a tug-of-war with the International Atomic Energy Agency. Last October, when Iran declared its intention of adopting the Additional Protocol to the Nuclear Non-Proliferation Treaty, the signing of a huge approximately $2-billion deal with Japan was in the offing; without this willingness on Iran's part, Japan would not have signed the deal.
This game of Iran's, among other things, has led to the conclusion on the part of members of the American Council on Foreign Relations, which is headed by Zbigniew Brzezinski, to issue a report this month in which there are recommendations to conduct constructive negotiations with Iran with the participation of European states, and to use more carrots than sticks. This is based on the assumption that the U.S. cannot and does not want to conduct another military campaign in the Middle East, and on the more solid supposition that has led the authors of the report believe that it is possible to reach agreements with Iran, primarily because of the regime's economic aspirations. This report has already been subjected to a great deal of criticism from neo-conservative elements in the Pentagon. It is thus possible to wager, then, without taking too much risk, that U.S. President George W. Bush will not change his policy during the next two months.

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Iran Ready to Provide Nuke 'Guarantees'
Sat Aug 28, 6:34 PM ET
By ALI AKBAR DAREINI, Associated Press Writer
TEHRAN, Iran - Iran said Saturday it would continue its nuclear program but provide "guarantees" not to build atomic weapons, and warned Washington it cannot stabilize neighboring Iraq (news - web sites) and Afghanistan (news - web sites) without Tehran's help.
In a wide-ranging news conference, Iranian President Mohammad Khatami (news - web sites) said the wall of mistrust separating Tehran and Washington had become thicker during the Bush administration, adding he hoped American casualties in Iraq would affect U.S. public opinion before the November election.
Washington claims the Iranian nuclear program is aimed at building atomic weapons, but Tehran says is directed at generating electricity.
"We are ready to do everything necessary to give guarantees that we won't seek nuclear weapons," Khatami said.
"As Muslims, we can't use nuclear weapons," he told reporters in Tehran. "One who can't use nuclear weapons won't produce them."
He did not elaborate on the nature of the guarantees, but Iran has already agreed to international inspections of its nuclear facilities and military sites. Khatami reiterated his country would not give up its nuclear program.
Khatami's statement marks the first time Tehran has so publicly said it would provide guarantees to ease international concerns about its nuclear program.
On the U.S.-led conflicts in neighboring Iraq and Afghanistan, Khatami said Washington needs Iranian help to succeed in both countries. The United States and some Iraqi officials accuse Iran, which follows the Shia branch of Islam like most Iraqis, of meddling in Iraqi affairs.
"The U.S. knows itself that it can't succeed in Iraq and Afghanistan without an Iranian presence," he said. "Without imposing itself, Iran is considered an effective force in Iraq. You can't ignore the Islamic Republic of Iran."
Khatami, however, said Tehran will not to settle its "many differences with America" in Iraq, but strongly criticized Bush for his Iraq policies, saying he hoped U.S. casualties in Iraq would affect the outcome of the upcoming election.
But he praised Iraq's most senior Shiite cleric, Grand Ayatollah Ali al-Sistani, as a supporter of democracy in Iraq, unlike the Americans "who are suppressing the people."
He warned Washington against making the same mistake it did in Iraq by attacking Iran, but said an American invasion was doubtful because the United States was so bogged down in Iraq.
President Bush (news - web sites) labeled Iran as part of a global axis of evil along with North Korea (news - web sites) and Iraq under Saddam Hussein (news - web sites).
"There is enough American public opinion pressure on Washington because of the young soldiers being killed in Iraq" to ensure Washington does not threaten Iran, he said.
Khatami warned Israel it would be committing "suicide" if it attacked Iran, following recent threats that the Jewish state might take military action to prevent Iran from making a nuclear bomb.
On the nuclear issue, Khatami said Iran is entitled to obtain capabilities to go through the full nuclear fuel cycle, from extracting uranium ore to enriching it for use as reactor fuel.
"We don't want anything beyond this. It's our legitimate right and no country can prevent us from achieving it," he said.
Earlier this month, Iran confirmed it had resumed building nuclear centrifuges, which can be used to enrich uranium to weapons grade, and declared it should have the right to advanced nuclear technology.
Washington has been lobbying U.N. nuclear watchdog, the International Atomic Energy Agency, to refer Iran's nuclear dossier to the Security Council, which could impose sanctions.
Khatami said Washington has no evidence to demand U.N. sanctions and urged the IAEA not to bow to U.S. pressure when it discusses Iran's nuclear program next month, saying the Iranian case should be closed.
Khatami, ending his second and final four-year presidential term in 2005, acknowledged he had failed to fully implement his social and political reform program because of opposition from unelected, powerful hard-line institutions controlled by Islamic clerics.
Still, he said he had changed Iran's political landscape, adding "I came to work within the ruling system, not to change the system or bring tension."
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IRAN
Nuclear Weapons
Updated: November 25, 2003
What steps are being taken to curb Iran's nuclear program?
Iranian officials have admitted to the United Nations International Atomic Energy Agency (IAEA) that they have been secretly developing a broad range of nuclear capabilities for the past 18 years. The IAEA board decided not to sanction Iran for these disclosures. Instead, on November 26 it adopted a resolution that condemned Iran's past violations of IAEA rules and welcomed Iran's new pledges of cooperation. In recent weeks, Iran has agreed to snap weapons inspections and a temporary halt to its uranium enrichment program.
What is the Bush administration's reaction to this deal?
Secretary of State Colin Powell said November 26 he was "very happy" with the IAEA resolution. But U.S. officials had been pushing for stronger action against Iran. Specifically, they wanted Iran to be declared in breach of the 1968 Nuclear Non-Proliferation Treaty (NPT) and for the matter to be referred to the U.N. Security Council, which could then impose sanctions. U.S. officials failed to convince a majority of countries on the 35-member IAEA board that this step was required. According to The New York Times, only Canada, Australia, and Japan agreed to support the U.S. position.
Why did most countries push for a compromise?
One reason was that the IAEA did not consider Iran's many violations of specific nonproliferation rules proof that Iran had a nuclear weapons program. This conclusion led to outrage on the part of the U.S. representative to the IAEA, Kenneth Brill, who said the Iranian government had "systematically and deliberately deceived the IAEA and the international community about these issues for year after year after year" to further its "pursuit of nuclear weapons." Many international nuclear experts have agreed that the types of experiments Iran was conducting--such as uranium enrichment by laser--strongly suggest the existence of a nuclear weapons program.
Another reason was that officials from France, Germany, and Britain were eager to encourage so-called pragmatic leaders in Iran who are pressing for greater engagement with the international community, rather than continued isolation. Hardliners in Iran have argued that their country--which the State Department classifies as the leading state sponsor of terrorism--should drop out of the NPT and speed up development of a nuclear bomb. This path, similar to the one pursued by North Korea, would have escalated the crisis, proponents of engagement say.
What does the new IAEA resolution say about Iran's nuclear program?
It "strongly deplores Iran's past failures" to disclose its nuclear program and calls on Iran "to undertake and complete the taking of all necessary corrective measures on an urgent basis," according to press reports. The IAEA's latest analysis of Iran's nuclear program found "that Iran has failed in a number of instances over an extended period of time to meet its obligations" with respect to the reporting, processing, and use of nuclear materials. However, it found "no evidence" that Iran was pursuing nuclear weapons--a phrase IAEA head Mohammed ElBaradei later explained meant "no proof" in a legal sense.
What would happen if Iran violates more IAEA rules?
The agency would then be able to use "all options at its disposal" to punish Iran, according to the IAEA resolution. U.S. diplomats say this language is a veiled reference to U.N. Security Council action.
Does Iran have a program to build nuclear weapons?
Many international officials and weapons experts believe it does. The Bush administration is concerned that a nuclear-armed Iran, one of the three nations in the group President Bush labeled the "axis of evil," would further destabilize the Persian Gulf region and possibly give terrorists access to weapons of mass destruction.
Why does Washington suspect Iran is seeking nuclear weapons?
Iran's secret nuclear program included all the steps needed to make fissile material for a nuclear bomb. U.S. officials argue that Iran would not have denied the existence of a peaceful nuclear energy program. Iran also has the world's sixth largest oil reserves, raising suspicions about why it would spend billions of dollars to develop nuclear power plants. Iranian officials, however, say their program is committed to nuclear power and other peaceful uses.
Will the new agreement prevent Iran from getting a nuclear weapon?
It's unclear. Some experts and international officials argue that the new, more rigorous IAEA inspection protocol, coupled with Iran's desire to engage with the international community, will dissuade it from seeking nuclear weapons. Others point out that powerful elements within the Iranian government, including the leadership of the Revolutionary Guards, remain intent on acquiring the capability to develop atomic weapons, raising concerns that Iran might continue to conceal parts of its nuclear program. Nuclear experts also warn that, under the terms of the NPT, Iran can legally develop a peaceful nuclear power program, then drop out and rapidly convert it to an illegal weapons program. According to the NPT, Iran may build any nuclear facility, including uranium enrichment plants to create nuclear fuel, as long as the facility is devoted to peaceful uses and subject to IAEA safeguards and inspections.
When could Iran have a nuclear weapon?
The Bush administration has been operating on the assumption that Iran could have a nuclear bomb by 2006 if no steps are taken to slow the program, says Kenneth Katzman, a specialist in Middle East affairs for the Congressional Research Service. On June 11, Secretary of Defense Donald H. Rumsfeld said, "The assessment is that they [the Iranians] do have a very active program and are likely to have nuclear weapons in a relatively short period of time." Previous administration forecasts--made before Iran's stepped-up uranium enrichment activities were discovered in February 2003--indicated Iran could go nuclear by the end of the decade.
What is Iran's main civilian nuclear facility?
When it's completed, it will be an $800 million Russian-built nuclear power plant at Bushehr, along the Persian Gulf in southwestern Iran. Bushehr is scheduled to open in 2005, and Russian officials say they will continue to build the reactor despite fears that Iran could divert expertise and spent fuel into a nuclear weapons program. Bushehr will be subject to IAEA inspections, and to further safeguard the plant, Russian officials have said they will require all spent fuel rods from Bushehr to be returned to Russia. The rods contain plutonium, which can be reprocessed to fuel a nuclear bomb.
What are some of the warning signs that Iran is seeking nuclear weapons?
Among them:
Iranian officials have admitted that Iran has been secretly developing, for 18 years, a uranium centrifuge enrichment program, and, for 12 years, a laser enrichment program, in violation of Iran's nuclear safeguards agreement with the IAEA.
Iran has secretly produced small amounts of low-enriched uranium and plutonium, in violation of the IAEA agreement.
Iran revealed in February that it was constructing a secret gas centrifuge uranium-enrichment plant at Natanz. Subsequent IAEA inspections found traces of weapons-grade uranium there.
Traces of enriched uranium were also found at a centrifuge workshop near Tehran called the Kalaye Electric Company.
Iran also revealed in February that a secret heavy water production facility was under construction in Arak, just north of Natanz. Heavy water can be used to produce plutonium, another fuel for nuclear explosions.
Iran failed to reveal to the IAEA that it imported 1.8 metric tons of natural uranium from China in 1991 and stored it at an undisclosed laboratory at the Tehran Nuclear Research Center.
Iranian officials want to mine and enrich their own uranium, which many experts say is costly and unnecessary for the civilian nuclear program that Iran is pursuing. On October 21, Iran agreed to suspend, but not dismantle, this aspect of its program.
Why did Iran announce the existence of the secret plants in February?
It's not clear. Some experts say that Iran has decided the best way to keep its nuclear program afloat and allay international suspicion is to comply fully with IAEA rules. Others say Iran got caught with a secret program and was trying to minimize the damage. An Iranian opposition group, the Mujahedeen-e-Khalq (which is classified by the U.S. State Department as a terrorist group), announced in August 2002 that it had intelligence about the two facilities, taking many international governments by surprise.
Will this issue be resolved diplomatically?
It appears so, if Iran follows through with its pledges to cooperate with the IAEA and opens all of its nuclear facilities to international inspectors. If Iran continues to violate its agreements, however, sanctions or other punishments could follow. According to the Bush administration, a unilateral military strike against Iran's nuclear facilities is not currently under consideration.
-- by Sharon Otterman, staff writer, cfr.org

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Tehran's pragmatists are ready to talk
By Ray Takeyh
International Herald Tribune, August 24, 2004
WASHINGTON As Iran's nuclear challenge becomes the subject of international deliberations, the Islamic Republic is confounding another U.S. administration. It is tempting simply to regard the Iranian regime as unfit for rehabilitation and to isolate it until it is replaced. But one of the many paradoxes of modern Iran is that the recent demise of the reform movement has facilitated the ascendance of pragmatic conservatives willing to have a far-reaching dialogue with the United States. At a time when the challenge of Iran seems most acute, the prospect of Tehran accommodating Washington has never been greater.
It is customary in the West to view Iran's conservatives as a mass of undifferentiated reactionaries, united in purpose and driven by a regressive ideology. Yet even among those who proclaim their fidelity to the Islamic revolution, there are many who appreciate that mere slogans cannot solve Iran's economic and security quandaries.
The pragmatic conservative clerics grouped around the powerful former president, Ayatollah Akbar Hashemi Rafsanjani, believe the regime must address the economic demands of its hard-pressed constituents, which would require not only structural reforms but also a rational foreign policy that ends Iran's isolation from the global marketplace.
To accomplish this, Iran must not only engage its immediate neighbors, but also reach a modus vivendi with the United States. The pragmatists, unlike the reformers, have the clout to deliver on their pledges because of their commanding position in the national security apparatus and their close ties to the supreme leader, Ayatollah Ali Khamenei.
Historically, the conservatives have been vociferous in condemning America as the "Great Satan." But the changed geopolitical map of the Middle East and the massive projection of U.S. power on Iran's periphery have led a critical segment of Iran's right to reconsider the value of a rational relationship with America.
The powerful secretary to the Supreme National Security Council, Hasan Rowhani, a leading pragmatist, acknowledged this point recently: "By intervening in Afghanistan and Iraq, the Americans have become our neighbors. We have to be realistic. One day, ties will have to be established."
A similar lean toward pragmatism is evident in this group's approach to the nuclear issue. While the reactionary clerics want Iran to pull out of the Nuclear Nonproliferation Treaty and manufacture nuclear weapons, the pragmatists recognize that such a strategy would wreck Iran's tenuous rapprochement with the Gulf states and even drive them further into the U.S. embrace. Moreover, such a policy would trigger multilateral sanctions, further isolating Iran from its valuable European commercial partners.
Instead of such brazen defiance, the pragmatists are following North Korea's example, seeking to employ the nuclear card to extract security and economic concessions from the international community.
A spokesman for Iran's Foreign Ministry, Hamid Reza Asefi, dangled the prospect of such a deal recently when he said, "We are ready for discussion and negotiations, but we need to know what benefits the Islamic Republic would get from them." Should Washington be willing to relax its economic sanctions and respect Iran's legitimate security interests in the Gulf, it may successfully defuse another proliferation crisis in the Middle East.
Among the fears that have greatly preoccupied Washington is that Iran is seeking to export its revolution to Iraq. Many Iranian hard-liners initially viewed Iraq, with its Shiite majority, as an ideal location for propagation of their radical message. But even on this issue the pragmatists have managed to curb the theocracy's impetuous designs. The notion of exporting the revolution was dismissed by one of Iran's leading pragmatic conservatives, Muhammad Larijani - a close adviser to Khamenei - when he said, "Iran's experience is not possible to be duplicated in Iraq."
Despite Tehran's vociferous objections to American intervention in Iraq, it does hold out the possibility of cooperating with America in achieving shared objectives. Iran has no desire to see a weak Iraq become a failed state as Afghanistan. In April 2004, Rafsanjani went so far as to say, "We helped the Americans in Afghanistan and we are ready to do the same with Iraq."
Iran's emerging pragmatists are well aware that the current state of U.S.-Iranian relations inhibits Iran's economic development, as investors are loath to send capital to a country that might become a potential war zone. Instead of a grandiose bargain with the United States, the pragmatists propose a series of tactical compromises aimed at obtaining nonaggression and nonintervention guarantees from Washington.
Incremental improvement in U.S.-Iranian relations and the gradual integration of Iran into the global economy hold out the best possibility of changing Iran's behavior on issues of concern such as terrorism and opposition to the Arab-Israeli peace process. An Iran that has a stake in regional stability and better relations with the United States is likely to avoid provocative policies.
If Washington wants a meaningful dialogue with Iran, it will find receptive interlocutors.
Ray Takeyh is a senior fellow at the Council on Foreign Relations.
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Managing Information
By Shane Harris
sharris@govexec.com
The Senate Intelligence Committee's 521-page critique of pre-Iraq War intelligence is more than a shot across the bow of U.S. intelligence agencies. It's a slap in the face, a kick in the pants and as pointed a reprimand as the august body could muster without degenerating to fisticuffs.
The review concludes that the government's intelligence agencies, in particular the Central Intelligence Agency - their conduit to the president - assumed a lot about Iraq's efforts to build and use weapons of mass destruction, including chemical, biological and nuclear devices. Many of their assumptions were wrong, which is problematic since President Bush used them in issuing his call to upend Saddam Hussein to save the world from his WMD.
The botched analysis was manifest in an October 2002 National Intelligence Estimate, which supposedly represented the consensus of all 14 intelligence agencies. But Senate investigators found reports, some never included in the NIE, that contradict its conclusion that Iraq possessed WMD and could make more. This missed call has been labeled "an intelligence failure."
But the fundamental problems with the NIE didn't stem from the quality of the intelligence, an examination of the Senate report shows, although some of it was deficient. Rather, the government's inability to assess Iraq's weapons programs represents a failure of management, primarily at the CIA.
Trouble at the Top
Consider the intelligence production cycle. Information arrives at agencies - from human sources, from satellite photos, from the morning paper - and analysts study it. Then they write documents - such as briefings or NIEs - that are consumed by decision-makers. It's essentially a secretive publishing enterprise - information comes in at the lower levels and is read at the highest.
As information rises up the chain in any hierarchical organization, such as the CIA, the FBI or even the Coca-Cola Co., pieces of it fall away, like jettisoned stages of a rocket, until a capsule of distilled information remains, easy to consume, brief and, most important, decisive. It's the preferred method of creating executive-level summaries - "Just tell me what I need to know" - and it occurred with textbook regularity when the intelligence agencies sat down to write the Iraq NIE.
The problem is, the National Intelligence Estimate didn't tell decision-makers everything they needed to know. The Senate report exhaustively documents the exclusion or stifling of alternative analyses of Iraq WMD.
Dissenters from Air Force intelligence, for instance, were sidelined when they challenged the CIA view that Saddam Hussein would use his unmanned drone aircraft to drop toxic biological specimens on U.S. cities. The Air Force said the drone fleet was too small for that. The Air Force may be the leading authority on aircraft, but CIA analysts, with access to exclusive sources, considered themselves the experts on bioweapons.
Something similar happened with the CIA's examination of aluminum tubes, which analysts thought Iraq would use to enrich uranium for nuclear weapons. The agency didn't invite nuclear experts from the Energy Department to look them. A CIA analyst told Senate committee investigators, "We were trying to prove some things. . . . It wasn't a joint effort."
Considering the decisive role the drone and aluminum tube data played in characterizing Iraq's intentions as bellicose, CIA managers should have played devil's advocate and required their analysts to hear dissenting views, the Senate investigators concluded. But the managers didn't do that, investigators found. As a result, an NIE that could have been a fragrant stew was reduced to a thin consomm??.
The report's authors singled out the top manager, former Director of Central Intelligence George Tenet, painting him as an absent leader. Tenet told the committee that he doesn't expect to hear dissenting analyses "until the issue gets joined" during an NIE writing. The committee members indicated that if someone had looked at the issue before it was joined, the 373 members of Congress who voted to let the president invade Iraq might have changed their minds.
"The whole Iraq misadventure calls into question the very concept of an NIE," says Steven Aftergood, an intelligence expert with the Federation of American Scientists, who has spent years studying how the CIA works. "In retrospect, we would have been better off if each agency . . . produced its own estimate. The profound differences of opinion . . . would then have had a better chance to be aired and evaluated."
Or managers could have interceded. But, says one former CIA executive, that wouldn't happen under Tenet. "George doesn't do paper," the official says. "He doesn't do analysis. That responsibility fell back to [Deputy Director John] McLaughlin [now the interim CIA chief] and the staff."
But there, too, things broke down. CIA managers in the Directorate of Operations, the spy side of the house, withheld information from analysts. "Significant reportable intelligence was se-questered in CIA Directorate of Operations cables, distribution of intelligence reports was excessively restricted, and CIA analysts were often provided with 'sensitive' information that was not made available to analysts who worked the same issues at other . . . agencies," the Senate report says. "These restrictions, in several cases, kept information from analysts that was essential to their ability to make fully informed judgments." Some "sensitive" information concerned the reliability of two main sources on alleged mobile weapons labs and information pertaining to Iraq's aerial drone program, the one that raised dissents from Air Force analysts.
Cowardly Bureaucracy
Considering that the Iraq assessment went so wrong, can the intelligence process be fixed? Any reforms must be targeted at the CIA's inherent managerial weaknesses, experts say.
On the analysis side, the former intelligence executive says the agency's secretive and hierarchical nature has created "a lot of little hollers" in which senior analysts mentor junior ones who sometimes parrot their teachers' convictions. That cannot continue, he argues.
The CIA produces some radical, relatively heretical thinkers. But one analyst, who headed the agency's group targeting Osama bin Laden and wrote two books on radical Islam, says those bosses aren't serving their decision-maker customers because they don't encourage contrarian thinking.
Instead, the senior service is "just willing to go which way the wind blows," says the analyst, a senior service member himself, who uses the nom de plume Anonymous. Their resolve is most tested when they meet the people on the pointy end of the intelligence fork. In that risk-averse air, he contends, managers become much more selective in what they tell decision-makers, including the president. No one wants to stake his reputation on a bad analysis.
But that's just what happened with Iraq. And it begs the question of whether CIA managers pushed for analysis that jibed with the White House's public declarations that Iraq was a weapons-wielding worldwide threat. The Senate report says White House officials exerted no undue influence over the writing of the NIE. It blames the CIA's laser focus on trying to prove, rather than disprove, the presence of WMD partly on the agency's lack of awareness of how far Hussein had gone with his nuclear program before the first Gulf War and a desire not to get snookered again.
For now, the question of why the intelligence process was so one-sided remains. Whatever the reason CIA managers withheld information from analysts, the fact is, they did it. If they hadn't, the NIE might have read differently.
Undoubtedly, calls for reform will include an admonition to challenge intelligence assumptions, perhaps by creating a formal mechanism, such as an intelligence watchdog unit. But intelligence managers would do well to take on that responsibility. Otherwise, like cigarette packs, NIEs might have to carry a warning label: "Caution: Conclusions in this document may not reflect reality."

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>> DISSENTING REPUBLICANS?


Republicans for Kerry
Bush's defeat would be good for the GOP.
BY NIALL FERGUSON
Saturday, August 28, 2004 12:01 a.m. EDT
It is doubtless not the most tactful question to ask on the eve of the Republican convention, but might it not be better for American conservatism if George W. Bush failed to win a second term?
Yes, I know, the official GOP line is that nothing could possibly be as bad for the U.S. as a Kerry presidency. According to the Bush campaign, John Kerry's record of vacillation and inconsistency in the Senate would make him a disastrously indecisive POTUS--an IMPOTUS, as it were. By contrast, they insist, Mr. Bush is decisiveness incarnate. And when this president makes a decision, he sticks to it with Texan tenacity (no matter how wrong it turns out to be).
It is a mistake, however, to conceive of each presidential contest as an entirely discrete event, a simple, categorical choice between two individuals, with consequences stretching no further than four years.
To be sure, there are many tendencies in American political life that will not be fundamentally affected by the outcome of November's election. For example, contrary to what Mr. Kerry claimed in his convention speech, there are profound structural causes for the widening rift between the U.S. and its erstwhile allies on the European Continent that no new president could possibly counteract. And regardless of whether Mr. Bush or Mr. Kerry is in the White House next year, the U.S. will still be stuck with the dirty work of policing post-Saddam Iraq with minimal European assistance other than from Britain--which, by the same token, will remain America's most reliable military ally regardless of whether Mr. Bush or Mr. Kerry is in the White House.
Nor would the election of Mr. Kerry have the slightest impact on the ambition of al Qaeda to inflict harm on the U.S. Even if Americans elected Michael Moore as president, Osama bin Laden would remain implacable. In geopolitical terms, at least, what happens on Nov. 2 will change very little indeed. Yetin other respects--and particularly in terms of party politics--the election's consequences could be far-reaching. It is not too much to claim that the result could shape American political life for a decade or more.
Fourteen years ago, in another English-speaking country, an unpopular and in many respects incompetent conservative leader secured re-election by the narrowest of margins and against the run of opinion polls. His name was John Major, and his subsequent period in office, marred as it was by a staggering range of economic, diplomatic and political errors of judgment, doomed the British Conservative Party to (so far) seven years in the political wilderness. I say "so far" because the damage done to the Tories' reputation by the Major government of 1992-97 was such that there is still no sign whatsoever of its ever returning to power.
Many Conservatives today would now agree that it would have been far better for their party if Mr. Major had lost the election of 1992. For one thing, the government deserved to lose. The decision to take the United Kingdom into the European Exchange Rate Mechanism had plunged the British economy into a severe recession, characterized by a painful housing market bust. For another, the Labour candidate for the premiership, Neil Kinnock, had all the hallmarks of a one-term prime minister. It was Mr. Kinnock's weakness as a candidate that enabled Mr. Major to scrape home with a tiny majority of 21 out of 651 seats in the Commons. Had Mr. Kinnock won, the exchange rate crisis of September 1992 would have engulfed an inexperienced Labour government, and the Conservatives, having replaced Mr. Major with a more credible leader, could have looked forward to an early return to office.
Instead, the next five years were a kind of Tory dance of death, in which the party not only tore itself apart over Europe, but also helped to tear Bosnia apart by refusing all assistance to those resisting Serbian aggression. Meanwhile, a spate of petty sexual and financial scandals discredited one minister after another, making a mockery of Mr. Major's call for a return to traditional family values ("Back to Basics"). All of this provided the perfect seedbed for the advent of New Labour and the election by a landslide of Tony Blair in May 1997. Well, Mr. Blair is still in Downing Street and, having weathered the worst of the political storm over Iraq, seems likely to remain there for some years to come.Could something similar be about to happen in the U.S.? In my view, the Bush administration, too, does not deserve to be re-elected. Its id?e fixe about regime change in Iraq was not a logical response to the crisis of 9/11. Its fiscal policy has been an orgy of irresponsibility. Given the hesitations of independent voters in the swing states, polls currently point to a narrow Bush defeat. Yet Mr. Kerry, like Mr. Kinnock, is the kind who can blow an election in a single sound bite. It's still all too easy to imagine George W. Bush, like John Major, scraping home by the narrowest of margins (not least, of course, because Mr. Bush did just that four years ago).
But then what? The lesson of British history is that a second Bush term could be more damaging to the Republicans and more beneficial to the Democrats than a Bush defeat. If he secures re-election, President Bush can be relied upon to press on with a foreign policy based on pre-emptive military force, to ignore the impending fiscal crisis (on the Cheney principle that "deficits don't matter") and to pursue socially conservative objectives like the constitutional ban on gay marriage. Anyone who thinks this combination will serve to maintain Republican unity is dreaming; it will do the opposite. Meanwhile, the Dems will have another four years to figure out what the Labour Party finally figured out: It's the candidate, stupid. And when the 2008 Republican candidate goes head-to-head with the American Tony Blair, he will get wiped out.
The obvious retort is that American politics is not British politics. No? Go back half a century, to 1956, and recall the events that led up to the re-election of another Republican incumbent. Sure, Eisenhower didn't have much in common personally with George W. Bush, except perhaps the relaxed work rate. But Ike was no slouch when it came to regime change. In 1953 a CIA-sponsored coup in Iran installed as dictator Shah Mohammed Reza Pahlavi. In 1954 Ike enunciated the "domino theory," following the defeat of France in Vietnam and invaded Guatemala to install another pro-American dictator. In 1955 he shelled the Chinese isles of Quemoy and Matsu.
Yet Eisenhower's refusal to back the Anglo-French-Israeli invasion of Egypt following Nasser's nationalization of the Suez Canal, and his acquiescence in the Soviet invasion of Hungary, should have alerted American voters to the lack of coherence in his strategy. Predictably, Ike's re-election was followed by a string of foreign-policy reverses--not least the overthrow of the Hashemite monarchy in Iraq, Castro's takeover of Cuba and the shooting down of Gary Powers's U-2 spy plane over the Soviet Union. These were the setbacks that lent credibility to JFK's hawkish campaign in 1960: And Kennedy's victory handed the rest of the decade to the Democrats.
Like Adlai Stevenson before him, Mr. Kerry has an aura of unelectability that may yet prove fatal to his hopes. But a Stevenson win in 1956 would have transformed the subsequent course of American political history. Conservatives may ask themselves with good reason whether defeat then might ultimately have averted the much bigger defeats they suffered in the '60s. In just the same way, moderate Republicans today may justly wonder if a second Bush term is really in their best interests. Might four years of Mr. Kerry not be preferable to eight years or more of really effective Democratic leadership? Mr. Ferguson, professor of history at Harvard and a senior fellow of the Hoover Institution at Stanford, is author of "Colossus: The Price of America's Empire" (Penguin, 2004).
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No Dollar Left Behind
The GOP gets failing grades.
By Timothy P. Carney
JAVITS CENTER, NEW YORK -- As recently as 1996, the Republican-party platform called for the abolition of the Department of Education as an unconstitutional, heavy-handed, and ineffective entity. Eight years later, things have changed.
Conservatives in New York this week knew there was trouble once they read the first sentence of the platform on "No Child Left Behind." It read: "Public education is the foundation of civil society." (In comparison to "family," which earned the description of being the "cornerstone.")
The second sign of trouble was learning that the subcommittee handling education was chaired by Rep. Phil English (R., Penn.), a key ally of Arlen Specter this past spring, and had the endorsement of the National Education Association.
The two days of platform debate confirmed the suspicion that the GOP has become the party of Big Education.
On Wednesday, conservative Texas delegate Kelly Shackelford moved to strike the "foundation" sentence, asking "were we not a civil society for the first hundred years of our country?" English and most of the delegates resisted, insisting the GOP declare its undying support of government schools.
So Shackelford offered a compromise: just remove the word "public." Education as a foundation of civil society was an idea most people can accept. Invoking an idea of tolerance fit for George Orwell, some delegate objected that without specifying public education over private and religious education, that sentence would be discriminatory. Shackelford lost again.
After all was done with the subcommittee, the first sentence appeared as, "Public Education is a foundation of free and civil society [emphasis added]." Shackelford and others tried in full committee to add other kinds of education to that sentence, but they were defeated again, at the urging of English.
The next section was even more displeasing to conservatives. Titled "Historic Levels of Funding," it bragged about outspending Bill Clinton, Jimmy Carter, and Richard Nixon on education. The paragraph could have been mistaken for an angry screed from a disillusioned fiscal conservative:
"President Bush and Congressional Republicans have provided the largest increase in federal education funding in history and the highest percentage gain since President Johnson." Efforts to strike this paragraph ("we're using liberal Democrats in our platform and saying we're worse than them," objected one delegate) were met with angry scolds by the Bush campaign's proxies, but conservatives got a bone thrown to them when the full committee struck the words "President Johnson" and replaced them with "the 1960s."
One other scuffle on education reflects the entire platform process's central-planning problem. Shackelford introduced an amendment to reinsert language from the 2000 platform saying education is essentially a local undertaking. He was defeated by other delegates who explained that Republicans no longer believe in local control after No Child Left Behind.
When he couldn't convince other delegates with appeals to conservative principles, Shackelford turned to the true guiding star for the platform: the Bush campaign's policy team.
With the stamp of approval from the campaign, Shackelford was able to pass his amendment through full committee -- with the campaign's proxies explaining that although No Child Left Behind looked like a huge federal power grab, it really was all about local control.
Delegates also failed to insert language objecting to in-state college tuition for illegal aliens. No one even tried to deny illegals access to public schools.
Conservatives hoping for real education reform had started losing hope in the GOP before the 2000 election. This platform convinced conservatives that on education, it may be about time to jump the GOP ship.
-- Timothy P. Carney is a reporter for the Evans-Novak Political Report.
http://www.nationalreview.com/comment/carney200408271245.asp

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The Republican Convention
The party begins in New York City, paid for by special interests
By Meredith O'Brien
WASHINGTON, August 20, 2004 -- President Bush will accept his party's nomination in New York City at the Republican National Convention, an event that will cost an estimated $166 million. In addition to the tens of thousands of patriotically themed balloons, Republicans asked for and received millions of dollars worth of phone lines, computers, hightech gadgets, automobiles and parties, many of them paid for by special interests that had, in the past, contributed soft money to the Republican National Committee.
The largesse comes at a time when political conventions are attracting fewer and fewer viewers. Ratings for July's four-day Democratic convention on the three major networks, as well as on cable news stations Fox News, MSNBC and CNN "hit an all-time low," Entertainment Weekly reported.
Despite spending an estimated $95 million to throw the Democratic National Convention in Boston - the final tab won't likely be known for months - the event did little to change the dynamics of what still appears to be a close presidential election, especially among the crucial undecided voters. In the first national polls taken just after John Kerry accepted the Democratic nomination for president in his hometown, there was precious little, if any, bounce detected. Surveys conducted by various media organizations showed everything from what Newsweek called a "baby bounce" in his lead over Bush (up four points, the smallest post-convention bounce in the history of the magazine's poll), to what the Gallup organization saw as an actual five-point loss among likely voters, despite day after day of glowing adjectives being lavished on Kerry's image in front of a crowd of 15,000 journalists in the FleetCenter in Boston.
Republican 2004 National Convention
The Republican Convention
Counting the Costs
Spending Spree
Wining and Dining the GOP
Grand Old Parties
Many pundits have argued that the election results won't really be affected by the nominating conventions at all, but instead will hinge on the debates this fall between Kerry and Bush. Though presidential nominating conventions may no longer move poll numbers up, the price tag for the events shoots ever upward. According to a study by the Washington, D.C.-based Campaign Finance Institute , which tracks the escalating costs of presidential campaigns, spending for these four-day convention productions has grown, even if the impact of the conventions on the final election results is diminishing. "In a sense, the [convention] committees are building the stage props for a television production, with the costs going up even as hours of major network television coverage and average audience ratings have skidded," CFI analysts wrote in a July 2004 study.
As Senator Joe Biden, D-Del., made his way home from Boston, he remarked to The Boston Globe, "Maybe I've been to too many of these things, but two days would do it." Similar sentiments were uttered four years ago after the Democratic convention in Los Angeles wrapped up. "We ought to consider the possibility of shortening it," then-House Democratic Leader Richard Gephardt told The Wall Street Journal.
But cutting down--or even eliminating--the number of days of the national conventions would put a damper on the special interest parties slated for the weeks of the Democratic and Republican conventions. Lobbyists, businesses and interest groups hoping to make a pitch or build relationships with policy makers planned hundreds of private parties held during the Democratic convention in Boston and slated for the Republican convention in New York City. Though the Bipartisan Campaign Reform Act of 2002--better known as McCain-Feingold--banned unlimited cash donations to parties (known as soft money), special interests still can write large checks to a party's convention host committees, or throw elaborate bashes for the party leaders themselves. Or both.
"Companies like to be part of the democratic process of our country," Darrell Henry, the American Gas Association's government relations director told The Los Angeles Times. "It gives us exposure, and we get to be involved in the biggest political event of the season." The group is spending hundreds of thousands of dollars on parties at the Democratic and Republican conventions this year.
The senators and congressmen who are feted at convention week events like AGA's parties are often specifically invited for their areas of expertise and their committee assignments. In New York City, the AGA has teamed up with other energy interests, like the Edison Electric Institute and the National Mining Association, to throw a "Texas Honky-Tonk Salute" for Rep. Joe Barton (R-Texas), the chairman of the House Committee on Energy and Commerce. The same groups are throwing "The Wildcatters Ball" at Rockefeller Plaza for Sen. James M. Inhofe (R-Okla.), chairman of the Senate Committee on Environment and Public Works, according to media reports.
The Boston Herald estimated that some $20 million was spent in Boston alone on these private receptions. At least 50 parties costing $100,000 or more have been slated for both conventions, according to Broadcasting & Cable.
On top of the lavish parties, private groups are getting around the campaign finance regulations by pouring unlimited amounts of money into the committees hosting the conventions, technically designated as charitable, civic booster organizations by the Federal Election Commission. These groups don't have to reveal the names or contribution amounts of their donors.
Still, an examination, based on newspaper reports, press releases, Web sites and other sources, of the donors to the New York City 2004 host committee and to Republican campaigns as well as to the Boston 2004 host committee and to Democratic campaigns yields interesting results. Twenty-six companies gave either cash or in-kind contributions to the host committees for both conventions, according to a Center for Public Integrity analysis. Most of those companies also contributed soft money to both parties in the 1999-2000 election cycle, as well as to the federal campaigns of both President Bush and Senator Kerry, as well

as to Kerry's Political Action Committee. (See chart below).
Contributors to Boston and NYC host committees Democratic soft money 1999-2000 Money to Kerry federal campaigns and PACs since 1991 Republican soft money 1999-2000 Money to Bush federal campaigns since 1999
Allied Domecq $51,600.00 $725,017.00 $7,500.00
Amgen Inc. $150,000.00 $11,500.00 $1,780,200.00 $31,840.00
AstraZeneca $6,425.00 $105,000.00 $8,200.00
AT&T $7,142,507.00 $19,550.00 $12,176,649.00 $54,215.00
Bank of America $41,952.00 $233,550.00
Bristol-Myers Squibb Company $7,402.00 $57,050.00
CB Richard Ellis $18,300.00 $62,770.00
Citigroup $202,310.00 $328,695.00
Clear Channel Outdoor $985,000.00 $14,500.00 $2,154,950.00 $93,615.00
Credit Suisse First Boston $106,154.00 $430,550.00
DaimlerChrysler Corporation $14,000.00 $3,450.00 $212,725.00 $37,025.00
Delta Air Lines, Inc. $1,275,000.00 $30,350.00 $818,996.00 $76,611.00
EMC Corporation $12,975.00 $1,820,000.00 $172,515.00
Ernst & Young $2,238,000.00 $74,975.00 $2,769,525.00 $443,809.00
Fannie Mae $38,000.00 $37,465.00
General Motors Corp. $12,500.00 $11,500.00 $331,300.00 $138,295.00
IBM Corporation $78,980.00 $67,693.00
KPMG LLP $26,550.00 $1,312,850.00 $171,027.00
Marriott International, Inc. $260,000.00 $6,250.00 $1,099,500.00 $23,875.00
Microsoft Corporation $3,901,876.00 $115,913.00 $8,822,623.00 $230,740.00
New Balance Athletic Shoe, Inc.
Pfizer Inc. $1,040,000.00 $26,150.00 $14,030,244.00 $118,304.00
Serono, Inc.
The Coca-Cola Company $400.00 $4,500.00
Verizon Communications $3,000,500.00 $87,158.00 $5,280,832.00 $134,980.00
Waste Management, Inc. $525,000.00 $5,750.00 $1,935,535.00 $143,519.00
(Source: Center for Public Integrity analysis based on FEC data)
'In kindness' of interests
When not directly writing checks to the campaigns, some companies are showing their appreciation to the parties indirectly, by giving in-kind donations to the host committees.
General Motors, for example, supplied 300 vehicles to Democratic convention organizers in Boston. Neither convention organizers nor city officials would say what happened to those vehicles after the convention. The same number of vehicles was donated to the GOP convention in New York. Officials on that end were also mum about what will happen to those shiny new vehicles after the balloons drop from the Madison Square Garden ceiling. Kimberly Hippler, a spokeswoman for GM, told the Center that donating the vehicles is "good for the political process by helping solve sheer transportation issues at the convention, and it's good for GM to be doing this." She said it is "hard to estimate the cost" of the vehicles and that after the convention, the vehicles are "all dispersed into different applications, dealers, auctions, [I] can't say where they're all going to."
Panasonic made donations of various video and audio products to Republicans--as they did with the Democrats--giving conventioneers more than 100 Panasonic Viera high definition plasma monitors, according to the Republican convention and Panasonic Web sites. The retail price for those units ranged from $3,700 for the 37-inch Panasonic Vieras to $8,000 for the 50-inch models. Panasonic officials did not return Center phone calls regarding what will happen to its televisions after the convention has concluded.
Officials from the Republican Party, the host committee and the New York City mayor's office refused to field questions about what will happen to the in-kind contributions, like the cars, plasma TVs and Blackberries, donated for convention use once the Republicans leave town.
After months of reviewing thousands of pages of FEC and other public documents, the Center for Public Integrity has completed an analysis of the making of a Republican national convention. From examining the Request for Proposals issued by the Republican National Committee--which details a long list of items any city and civic committee willing to serve as host would have to provide party officials--and perks expected for GOP convention delegates, to actual convention spending for the 2000 Republican convention in Philadelphia and spending thus far for the 2004 convention in New York, the Center sought to provide an overview of the costs and expectations surrounding a national convention.
A summary of the findings:
What Republicans want: Like their Democratic counterparts, GOP officials mandate many goods and services from cities and their civic organizations seeking to host their national, quadrennial conventions. For its 2004 convention, Republicans asked for housing for a year for designated GOP convention staff, new computer equipment, Blackberry wireless devices, 300 air-conditioned buses, sedan car services for GOP officials, gasoline and drivers for all vehicles donated to the host committee and more than $1 million in office supplies, to name a few of the line items.
The site selection process: The method of selecting a city to host a presidential convention is becoming increasingly lavish. Cities hoping to land the 2004 Republican convention and its 50,000-person entourage went to great lengths to show the scouting party of about 20 Republicans that they know how to throw a party. In 2002, the cities vying for the convention treated the Republicans to fine food, lodging and elephant-shaped ice sculptures. The real cost of these three-day, multi-city tours goes largely unreported, as many cities and their visitors bureaus are reluctant to divulge this information. But according to documents filed by the Philadelphia 2000 host committee with the FEC, the group spent more than $1 million on its site selection process to lure the Republicans to its city for the 2000 convention. New York officials declined to say how much its host committee and other city organizers spent on its winning bid.
The impact of hosting the convention: There's disagreement about whether presidential conventions provide an economic boon to host cities immediately, pay off later after four days of a positive national spotlight on the community, or actually cost the city money. But in the case of this year's Republican convention, some analysts say it likely won't be as much of a boon as public officials claim. The Boston-based Beacon Hill Institute reported that although New York City Mayor Michael Bloomberg has said his city will yield a $250 million boost from hosting the Republican convention, once the security measures required by the Secret Service are taken into account, the city will only benefit to the tune of $163 million. [See "Counting the Costs"]
Where does the convention-related money go? An analysis of the 2000 Philadelphia convention spending by the RNC's Committee on Arrangements(COA) for the convention found that the largest chunk of party money--$8.2 million--was spent on payroll and consulting costs, followed by $2.7 million for travel and lodging and almost $1.1 million for media. As for the spending for the 2000 Philadelphia host committee--the private fundraising and convention organizing group that served, in the words of the Campaign Finance Institute, as an automatic teller machine for the Republicans--the top dollars went to consultants, $20.7 million, while costs related to events and facility renovations topped $17.9 million, followed by travel, lodging and transportation at $7.4 million.
A look at the 2004 spending by the COA between January 2003 and June 30, 2004, found that $4.67 million was spent on payroll and consulting, $585,000 was spent on travel expenses and $283,000 was spent on media expenses. New York 2004, the host committee for convention, isn't required to divulge its spending until 60 days after the convention. [See "Spending Spree"]
What Republicans want
Post-9/11 security measures aside--the federal government gave the two conventions a total of $100 million to cover security costs, in addition to the nearly $30 million it gave them to spend as they pleased--convention costs continue to increase, mostly due to the demands the parties place on their host cities for goods and services.
Through a Freedom of Information Act request filed with the city of New York, the Center for Public Integrity obtained a copy of the winning bid submitted to the RNC by the city of New York, and the contract signed between the RNC, the city, and the city's host committee, New York City 2004 (NYC 2004). The documents detail the party's expectations and what New York City and its host committee are obliged to provide for the Republican shindig.
Here's a partial list of the items, along with the price tags listed in the documents, when provided:
56 delegate events ($2.2 million).
Media, volunteer, hotel staff parties ($2.4 million).
Hospitality lounges for media, diplomats, Republican Party officials ($1 million).
Welcoming and information booths ($250,000).
Special events ($1.55 million).
Delegate packets ($800,000).
Decorations ($1 million).
Podium ($2.5 million).
D?cor and fabric coverings for Madison Square Garden ($808,000).
Office supplies for COA staffers ($1.2 million).
Shuttle for COA staff ($150,000).
A year of housing for COA staff ($2.3 million).
Telecommunications system ($5 million).
Laptop and desktop computers ($1.22 million).
24-hour police security for all COA facilities and convention hotels, as well as for dignitaries.
300 air-conditioned shuttle buses for convention participants. Sedan car service for "officers and staff of the COA and other officials as designated by the COA when such persons are in New York City conducting convention-related business," according to the contract. Drivers, vehicle maintenance costs and gasoline for vehicles given to the host committee or the COA. Subway and rail passes good for 60 days prior to the convention and throughout the duration of the event.
Unlike the contract signed between the city of Boston, its host committee Boston 2004 and the Democratic party--which specified that computer and web equipment would be returned to the city's schools, but gave no word on what would happen to the remainder of the items donated to the Democrats or the host committee--the contract between New York City and the RNC did, at least, make one issue a bit clearer, "No items, resources, services, or funds provided by the Host Committee or any Host City Party shall be used other than for Convention purposes." The contract further states, "The Host Committee agrees to use its best efforts to promptly return to the City such goods and equipment after the Convention Period, in good and operable condition, reasonable wear and tear expected."
But Republican officials wouldn't reply to Center inquiries about what would ultimately happen to those goods donated by private interests and not paid for by the city.
Site selection: Show me the free food
Some of the things Republicans can't give back are the free meals and trips they got when site selection committee members and other party officials were wined and dined by officials who wanted the GOP to hold its 2004 convention in their city.
Like the Democrats, Republicans hold a nearly year-long audition for would-be convention hosts, expecting potential host cities to show them the best of what they have to offer. Philadelphia's host committee spent well over $1 million in its attempts to woo the GOP to host its 2000 Republican convention in its city, according to FEC documents. And in March 2002, the RNC distributed a 30-page Request for Proposals to two dozen American cities to start the audition process anew, inviting them to submit bids if they were interested in hosting its 2004 convention.
Among the first to woo the Republicans were Bostonians, who held a clambake for members of the RNC in Beantown, nearly three years before the convention, before the party had even issued its RFP. Mayor Thomas M. Menino, a Democrat, and then-Gov. Jane Swift, a Republican, hosted the event in July 2001. More than 300 Republicans dined on lobster at the John F. Kennedy Library overlooking Boston Harbor, after first enjoying an amphibious excursion about the city on its famous "Duck Tours," according to a newsletter produced by Boston 2004, the committee that eventually hosted the Democrats in 2004.
Five cities eventually submitted written bids to GOP headquarters in Washington in 2002:
Boston, Miami, New York City--all three of which also sought the Democratic convention--New Orleans and Tampa-St. Petersburg. The New York, Tampa and Miami bids were the only ones delivered in person by officials from those locales, although Boston sent its three-pound bid in red computer bags with the logo, "We'll Do More in 2004," according to The Boston Herald. In July, the GOP announced it would make three site visits to New York City, New Orleans and Tampa-St. Petersburg.
For 10 days in August 2002, nearly two dozen Republican leaders took to the road to be feted in grand style.
According to The Bradenton Herald, Tampa-St. Petersburg organizers said they spent approximately $100,000 for the bid. Estimates for how much New York and New Orleans spent on their bids--including the costs of the site selection tour for 20 Republicans--haven't been publicly released. [See "Wining and Dining the GOP"]
An appeal to history
Yet New York had an advantage that its Southern competitors couldn't match, summed up in a date that hangs over the election--and the site selection process as well: September 11. With Mayor Bloomberg and former Mayor Rudy Giuliani on hand, New York Gov. George Pataki told fellow Republicans that New York City would be the best place to hold the 2004 convention for President Bush because it was symbolic of one of Bush's finest moments, when he went to Ground Zero to speak with the rescue workers days after airliners crashed into the World Trade Center, sending the towers crashing to the ground. "This will be an opportunity for the people of New York to say to the President, 'Thank you,'" Pataki said, according to The New York Daily News. The city's bid proposal featured newspaper images of Bush standing at Ground Zero on top of the pile holding the infamous bullhorn he used to speak with the rescue workers.
The focal point of a Republican convention in New York City, slated to run well into September, very close to the 9/11 attack's three year anniversary, would be the convention hall, Madison Square Garden, less than 4.5 miles from Ground Zero.
Imagery aside, New Yorkers still had to convince the Republicans that they should play host to their convention in a city where people of their political persuasion are outnumbered by a 5-1 margin. Among the site selection tour festivities USA Today reported that Republicans enjoyed:
A stay at The Plaza Hotel. (Its Web site boasts, "The crown jewel of Manhattan's fabled Fifth Avenue, The Plaza reigns over New York with a grace and glamour . . . a stay at The Plaza entails the ultimate in gracious luxury.")
A horse-drawn carriage ride across the city to Mayor Bloomberg's home on the Upper East Side.
A luncheon at the New York Stock Exchange, one of the most important centers of American commerce.
A Broadway performance of Thoroughly Modern Millie. Breakfast at the locale made famous by author Truman Capote and Hollywood icon Audrey Hepburn, Tiffany's on Fifth Avenue.
If Republicans were not sufficiently impressed by their Big Apple tour, Mayor Bloomberg--who threw $7 million of his own cash into New York's bid--capped six months of intense lobbying with one more trip to the nation's capital in November 2002. Bloomberg pressed not just the GOP, but Democrats as well, arguing that his city should be the host of both conventions. According to press accounts, Bloomberg had dinner with DNC chairman Terry McAuliffe and later a separate meeting with President Bush's political advisor Karl Rove to argue that his city had the fundraising promise and the high profile necessary to make for a successful convention, according to Newsday.
The polls will tell whether Bloomberg's pitch pays off for Republicans.
Meredith O'Brien was a co-author of The Buying of the President (Avon, 1996), and last wrote for the Center on the Democratic Convention.
Agust?n Armendariz contributed to this report.

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Halliburton Contracts Balloon
Despite being under an investigative cloud, company gets $4.3 billion in 2003
By Andr? Verl?y and Daniel Politi
WASHINGTON, August 18, 2004 -- The oil services company Halliburton, largely through its subsidiary Kellogg, Brown & Root, has received more revenue from government contracts in the last year than from 1998 through 2002. In 2003, when the company had record revenue of $16.3 billion, Halliburton received contracts from the Department of Defense worth $4.3 billion, while in the previous five years it obtained less than $2.5 billion from the military, according to an analysis by the Center for Public Integrity. Although figures are not yet available for 2004, government revenue is bound to increase as a result of the contracts the company has won for work in postwar Afghanistan and Iraq, which so far potentially totals $11.4 billion. Some of that work was actually awarded earlier; many of the company's contracts extend for multiple years. In 1998, Halliburton's total revenue was $14.5 billion; that year, the company got contracts from the Pentagon worth $284 million. Two years later, revenue had dropped to just under $12 billion while work under DoD contracts more than doubled. In 2002, DoD awarded Halliburton tasks worth $485 million while the company's revenue was $12.6 billion. Of the more than 150 American companies that together have received U.S. government contracts potentially worth more than $51 billion for postwar work in Afghanistan and Iraq, Halliburton is by far the largest recipient of contracts awarded in the two countries. As part of its continuing Windfalls of War project, the Center for Public Integrity has been compiling information on contracts awarded by the U.S. government for support in Operation Enduring Freedom and Operation Iraqi Freedom. The Center has compiled its list of contractors and contract awards through information obtained from 95 requests and appeals filed under the Freedom of Information Act or through official government and company sources.
A company under investigation
Halliburton, where Vice President Richard Cheney served as CEO from 1995 to 2000, has come under increased scrutiny because of allegations of overcharging on food service and fuel distribution contracts, poor management and close ties to the administration. This year, two audit reports by the Defense Contract Audit Agency found several deficiencies in KBR's billing system. As a result, the agency is withholding $186 million in payments for food service until KBR provides additional data showing that the meals billed actually were provided, according to congressional testimony by William H. Reed, the director of DCAA. The Pentagon's Inspector General also launched a criminal investigation in February 2004 into whether KBR overcharged the government while it was importing fuel from Kuwait to Iraq. Patrice Mingo, a spokeswoman for Halliburton, told the Center that the company has not received an official notification of an investigation by DOD's IG office. A Pentagon spokeswoman said the investigation is on-going. In a February press release the company said it welcomed a review of all its government contracts and denied overcharging. On Aug. 3, 2004, the Securities and Exchange Commission fined Halliburton $7.5 million for failure to disclose a change in its accounting practice. This change in accounting for cost overruns, while not out of the norm, means that public filings by the company were misleading in 1998 and 1999, according to the SEC. For example, in the second quarter of 1998 Halliburton used the new accounting practices without disclosing them and reported a pre-tax income of $228.7 million. If the old accounting practices had been used the pre-tax income would have been $183.3 million.
Robert C. Muchmore Jr., Halliburton's former controller, also agreed to a $50,000 fine by the SEC while a suit was filed against Gary V. Morris, the company's former chief financial officer. Vice President Cheney, Halliburton's chief executive officer during the period when these statements were released, provided testimony to the SEC but was not investigated. Halliburton and Muchmore neither admit nor deny the SEC's findings. In a shareholder class-action lawsuit in Dallas, four anonymous former accountants for Halliburton alleged earlier this month that the company had systematically committed accounting fraud to make projects appear more profitable.
On August 17, Halliburton said that the Army Materiel Command would start to withhold 15 percent of payments on future invoices under the LOGCAP III contract. A day later the Army reversed its decision, for reasons unknown. In the past, extensions to Halliburton had been given because, an Army spokeswoman said, neither the government nor the company had the necessary staff to review the increased number of bills. The Army did not return phone calls, but told the Washington Post that suggestions that Halliburton receives special treatment are wrong.
Anatomy of $11.4 billion
In Iraq, Halliburton subsidiary Kellogg Brown & Root has been awarded five contracts worth at least $10.8 billion, including more than $5.6 billion under the U.S. Army's Logistics Civil Augmentation Program contract, an omnibus contract that allows the Army to call on KBR for support in all of its field operations. When the Army needs a service performed, it issues a "task order," which lays out specific work requirements under the contract. From 1992 to 1997, KBR held the first LOGCAP contract awarded by the Army, but when it was time to renew the contract, the company lost in the competitive bidding process to DynCorp after the General Accounting Office reported in February 1997 that KBR had overrun its estimated costs in the Balkans by 32 percent (some of which was attributed to an increase in the Army's demands). KBR beat out DynCorp and defense giant Raytheon for the third LOGCAP contract in December 2001, this one to run 10 years.
Under the LOGCAP contract, in November 2002 the Army Corps of Engineers tasked KBR to develop a contingency plan for extinguishing oil well fires in Iraq. Not surprisingly, on March 24, 2003, the Army Corps announced publicly that KBR had been awarded a contract to restore oil-infrastructure in Iraq, potentially worth $7 billion. The contract KBR received--contract DACA63-03-D-0005--would eventually include 10 distinct task orders. KBR did not come close to reaching the contract ceiling, billing just over $2.5 billion. No additional task orders are being added to the contract, according to the Army Corps. [For more information on contract DACA63-03-D-0005, see Inside a War-Time Contract.] The contract was awarded without submission for public bids or congressional notification. In their response to congressional inquiries, Army officials said they determined that extinguishing oil fires fell under the range of services provided under LOGCAP, meaning that KBR could deploy quickly and without additional security clearances. They also said that the contract's classified status prevented open bidding. The contract was later declassified after the Center for Public Integrity filed a lawsuit under the Freedom of Information Act. In June 2003, the Army Corps announced that it would replace KBR's oil-infrastructure contract with two publicly bid contracts and in January 2004, the Army Corps awarded a contract that has a maximum value of $1.2 billion to KBR. The company is to continue its work to repair Iraq's oil infrastructure in southern Iraq. The contract for the northern region, with a maximum value of $800 million, went to Parsons.
In January 2004, the Army Corps awarded a contract with a potential value of $1.5 billion to KBR. The contract is for a full range of engineering services in the U.S. Central Command's area of operations, which includes Iraq and Afghanistan. The contract has a $500 million ceiling for the first year and four one-year options, each with an annual ceiling of $250 million.
Kellogg Brown & Root received a contract in August 2002 worth $110.7 million from the State Department to design and build office buildings and diplomatic staff apartments for the U.S. Embassy in Kabul, Afghanistan, as well as renovate existing offices. Additionally, as of June 2004, KBR had received 11 task orders under the LOGCAP contract for work in Afghanistan totaling $489 million.
Senior fellow Larry Makinson and database editor Aron Pilhofer contributed to this report.
http://www.publicintegrity.org/wow/printer-friendly.aspx?aid=366
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Still Groping in the Dark?
by Peter Van Doren, Jerry Taylor
Mr. Van Doren is editor of the Cato Institute's "Regulation" magazine. Mr. Taylor is Cato's director of natural resource studies.
It's been nearly a year since a quarter of the nation went pitch dark in one of the most widespread power blackouts in U.S. history. Lobbyists representing various factions in the industry have labored to use the event as ammunition for their respective policy agendas. But it turns out that the blackout revealed less about the merits of deregulation -- or various alternative institutional arrangements -- than it did about the difficulty involved in ensuring that a system as complex as the electricity grid stays up and running in the face of foreseeable contingencies.
The final report of the U.S.-Canada Power System Outage Task Force tells a complicated but prosaic tale about dozens of small things that went wrong with few obvious policy lessons. It found little evidence for the case that lack of transmission investment or deregulation -- two of the more popular explanations for the blackout -- had anything to do with the event. Instead, it found that poor tree maintenance along transmission lines in the First Energy (Ohio) service area, combined with inoperative computer software and various human errors, were the key events that triggered the blackout.
In short, three 345-kilovolt transmission lines went down when heat caused them to sag and come into contact with trees. That created an imbalance between supply and demand along the lines feeding the Cleveland area, which led, in turn, to higher current flow and accompanying lower voltage on a large portion of the remaining Eastern interconnection as the power raced along other routes to get to Cleveland.
When devices known as "relays" detected the unusual power flows around the Cleveland area, they automatically triggered circuit breakers that removed a number of lines from service (a preventative measure to ensure that billions of dollars of capital stock are not fried by unusual power flows). In the words of the report, the "cascade became a race between the power surges and the relays." The lines that tripped first were generally the longer lines that split the grid into those sections that blacked out and those that recovered without furthering the cascade. The upshot is that "protective relay settings on transmission lines operated as they were designed and set to behave on August 14."
Would less sensitive or more integrated relays have prevented the blackout? Apparently not. "The investigation team has used simulation to examine whether special protection schemes, designed to detect an impending cascade and separate the grid at specific interfaces, could have been . . . set up to stop a power surge and prevent it from sweeping through an interconnection and causing the breadth of line and generator trips . . . that occurred that day. The team has concluded that such schemes would have been ineffective on August 14."
How about mandatory, not voluntary, federal guidelines for industry reliability practices? To be sure, the lack of contingency planning and the lack of "situational awareness" by First Energy did violate the voluntary reliability guidelines which the company promised to uphold. Errors in that arena, however, were matters of secondary importance.
On the issue of vegetation management along the paths of transmission lines -- the proximate trigger for the entire event -- the voluntary guidelines established at the time by the North American Electric Reliability Council (NERC) were silent. Accordingly, if compliance with NERC guidelines were mandatory last year rather than voluntary -- the main reform advocated by politicians and industry analysts -- it would have made no difference.
In fact, First Energy went beyond the voluntary NERC guidelines by flying over its rights of way twice a year as was common industry practice. But in what surely counts as the understatement of the year, the Task Force report notes that flyovers do not appear in retrospect to be able to determine the distance between trees and transmission lines. Better practices are clearly in order, but First Energy was scarcely alone in believing that current practices were sufficient.
The report also discounted an intriguing explanation for the blackout that involves "reactive power," which is required for the operation of motors and other devices that use magnetic fields. The theory is that an insufficient amount of reactive power from generators led to the voltage collapse and the cascading blackout. In this view, the shortage of reactive power was a consequence of utility restructuring that ignored the need to ensure that merchant generators were given proper incentives to produce such power for the grid. In effect, this theory argues that the introduction of imperfectly designed markets was responsible for conditions that make blackouts more likely.
The task force found that reactive power levels were indeed low in the Cleveland/Akron area but were in fact sufficient to preserve stable (although lower than normal) voltage until the three 345-kilovolt lines tripped from tree contact.
In short, the current debate is blurring the distinction between problems attendant to the restructured electricity system and problems that contributed to the blackout on Aug. 14, 2003. It's certainly true that the transmission investment has not kept pace with the increase in system "throughput," although the optimality of the old ratio of investment to throughput is assumed rather than established. It's also true that utility restructuring has increased the number of players whose behavior has to be managed to prevent local system instabilities from spilling over into other service territories. And the evidence does suggest that under current voluntary industry guidelines some utilities are abusing the shared grid by deviating systematically from their supply and demand schedules. Likewise, analysts are right to worry that the restructured electricity system is dangerously cavalier about the need to ensure that sufficient reactive power is available to the system. Those four observations, however, have nothing to do with what actually happened to turn the lights off last year.
There are no quick or simple fixes for what went wrong last year. In fact, it's almost certain that a system as interdependent as the modern electricity system will forever remain vulnerable to such mishaps. While we believe that a serious discussion about the problems associated with the restructured electricity system is long overdo, stapling that discussion to the events of Aug. 14, 2003 confuses rather than enlightens the debate.
Reprinted from The Wall Street Journal ? Dow Jones & Company, Inc. All rights reserved.

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Politics Dog the Oil Reserve
By David G. Victor, Joshua C. House
Los Angeles Times, August 22, 2004
With oil prices heading toward $50 a barrel, what would happen if the markets really blew?
Ever since the late 1970s, Washington's answer to such an event has relied on oil stockpiled mainly by the federal government, to be released if market instability warranted it. Today, the U.S. Strategic Petroleum Reserve contains 666 million barrels -- nearly 65 days of imports -- worth nearly $30 billion at current prices. Our industrialized allies have similar stocks, India has started one and China, whose oil imports are rising rapidly, is expected to create a reserve soon. Through the International Energy Agency in Paris, the major oil importers have agreed, in principle, to coordinate their stockpiles.
Unfortunately, reserves in the United States and most democracies are nearly feckless as a policy instrument. The legislation that created the U.S. reserve gave the power to buy and sell stocks to a federal agency, now the Department of Energy, that, in effect, passes the decision on to the president. White House control automatically converts every key decision into a highly political act.
In July 2000, President Clinton's order to transfer some strategic reserves to fill a newly created Northeast Home Heating Oil Reserve had obvious political implications for Al Gore's presidential bid. In 1996, Congress required the sale of more than $220 million of stockpiled oil to help pay down the budget deficit, another political move, though one that, in hindsight, looked wise when oil prices tanked two years later.
The uncertainty of reliable production in Russia and Iraq, coupled with the general threat of new terrorist attacks, makes for many worrisome scenarios. But a cloud of political suspicion would hang over any management decision. If President Bush released stockpiled oil to stabilize prices in an election year, no matter how justified his action, he surely would be accused of political pandering. And if he rightly refused to release oil because speculative trading doesn't meet the standard of "severe energy supply interruption," as called for in the 1975 legislation setting up the Strategic Petroleum Reserve, would he face charges that he was rewarding his oil buddies with record profits?
One way to take the politics out of governing the Strategic Petroleum Reserve would be to mechanize decision-making, such as by setting a price trigger for sales and fills. President Reagan's Council of Economic Advisors, among others, considered this option and wisely demurred. In the 1980s, the international spot market for oil was not fully developed; prices were mainly driven by opaque long-term contracts, not market dynamics. Price triggers act similarly to price controls, increasing the risk of creating true scarcities in oil supply. Such automatic triggers would have smoothed small gyrations in the oil market but failed when most needed to dampen large price swings.
There's a better way: independent management of the strategic reserve. In contrast to an automatic mechanism, an independent authority would be able to detect subtle economic and political shifts that determine our true vulnerability to oil shocks. More important, such an authority would depoliticize Strategic Petroleum Reserve decision-making, which would enable us to use the stockpile for its originally intended purpose of providing a credible bulwark against the most severe chaos in oil markets.
The president could create an independent board to manage the reserve within existing legislation, but that would not completely remove a political taint. New legislation would better accomplish the job. Congress and the president should look to the Federal Reserve as a model. The Strategic Petroleum Reserve needs its own resources, with politicians supplying broad guidelines for action and periodic review rather than direct control. Such a change would not only affect the United States but would also require remaking the International Energy Agency into something closer to a central bankers' forum.
New management for America's oil reserve would spark new thinking about the optimal size and operation of strategic stocks. Until now, most public debate has focused on the reserve's size. The International Energy Agency suggests that its member countries keep a petroleum stockpile roughly equivalent to 90 days of domestic consumption. In truth, the optimal size of strategic reserves is not a single quantity but depends on political and economic conditions. A competent independent authority would make it possible to carry a smaller stockpile -- at lower cost. Because today's oil prices are formed in highly liquid markets, the standard of "severe supply interruption" is largely meaningless. The better standard is our willingness to absorb price shocks. For that there is no simple answer, yet independent economic authorities can make the wisest choices.
More than 30 years after our first oil shock, the Strategic Petroleum Reserve still wears polyester and bell-bottoms. A dose of market reform and political independence can bring its fashion up to date and create a truly useful tool for protecting the U.S. economy.
David G. Victor, adjunct senior fellow at the Council on Foreign Relations, and Joshua C. House are in the Program on Energy & Sustainable Development at Stanford University.


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August 24, 2004

Media Contact: (202) 789-5200
Pension underfunding leaves taxpayers vulnerable to major bailout
Without changes to funding, premium rules, crisis on par with S&Ls a real possibility
WASHINGTON--Underfunding of private-sector pension plans is rampant--currently more than $350 billion--and has led the Pension Benefit Guaranty Corporation (PBGC) to go from a $9.7 billion surplus in 2000 to an $11.2 billion deficit in 2003. This situation increases the likelihood that more pension funds will go under and leaves the PBGC poised for a taxpayer bailout similar to the 1980s savings and loan crisis, according to a new Cato Institute study.
"As long as sponsors of underfunded pension plans are not held responsible for the exposure they impose on the PBGC, ultimately either the premium level must increase, in which case some of the cost will be shifted to well-funded pensions in the short run, or, if exposures create claims that reach catastrophic levels, taxpayers will be called upon to provide a bailout through the PBGC," writes Richard A. Ippolito in "How to Reduce the Cost of Federal Pension Insurance."
Despite the dire warning, Ippolito, a former chief economist at the PBGC, suggests that to avert an impending crisis, pension plan underfunding can be controlled by transforming the PBGC into a private insurance program that sets premiums according to the amount of risk plan sponsors add to the program.
He adds that without changes to funding and premium rules, the PBGC's deficit is likely to increase to $18 billion over the next ten years, and may swell to $50 billion or more.
"Eliminate the loopholes that permit sponsors of underfunded plans to evade the variable rate premium and require sponsors to calculate market value underfunding," Ippolito recommends. "That change would dramatically increase revenues to the PBGC, reducing the need for a bailout and greatly reducing the level of underfunding."
Further, defined-benefit pension plans would pose no risks to the PBGC (or to a private pension insurance program) if they were fully funded and with assets that matched their liabilities.
"Once taxpayers were removed as ultimate guarantors of the insurance, the plans themselves (and most notably the better funded plans) would have an incentive to align premiums with exposure, and plan sponsors would have to face up to the problems that their own underfunding creates," Ippolito writes.

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PENSION REFORM IN CHINA: A QUESTION OF
PROPERTY RIGHTS
James A. Dorn
China's aging population will sharply increase the number of retirees who have to be supported by each worker in the next several decades. That demographic problem combined with the inability of state-owned enterprises (SOEs) to cover even the pensions of current retirees makes reform of the pay-as-you-go (PAYG) system a top priority. The State Council has issued a number of decrees calling for moving to a multi-pillar system, incorporating both a defined benefit PAYG plan and a defined contribution plan with fully funded individual accounts, but little progress has been made (Wang et al. 2004). Today China has a highly fragmented social security "system" confined primarily to workers in urban SOEs and some collectives. The high payroll tax rates and precarious nature of the system have led to noncompliance and evasion, and workers in the nonstate sector have little incentive to join (Zhao and Xu 2002). To solve China's pension crisis, one must also address the lossridden SOEs and the weak condition of the four large state-owned banks. Pension reform cannot be successful without a broad-based change in China's ownership structure. The lack of well-defined property rights to pensions, enterprise assets, and bank capital means that China's financial sector needs radical reform.
This article focuses on China's pension crisis from the perspective of property rights theory. The issue of pension reform is essentially a question of property rights: Should pension funds be fully funded and individually owned or should the state socialize assets by taking wealth from the younger working generation and redistributing it to Cato Journal, Vol. 23, No. 3 (Winter 2004). Copyright ? Cato Institute. All rights reserved.
James A. Dorn is Vice President for Academic Affairs at the Cato Institute and Professor of Economics at Towson University in Maryland. An earlier version of this study was presented at a conference on "China's Pension System: Crisis and Challenge," sponsored by the Cato Institute and Peking University's China Center for Economic Research. The author thanks Jacobo Rodr??guez for his helpful comments in revising this article for publication.
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the older retired generation? In the privatized system, individuals will have an incentive to act responsibly and to save and invest for the future. In the PAYG system, there is no saving and investment. Individuals look to the state for their future welfare, retirement becomes politicized, and property plundered. I shall argue that the best way for China to put its pension system on a sound footing is by large-scale privatization. Implicit pension debt must be made explicit and the current hybrid system must be fully privatized along with SOEs and state-owned banks. Trying to "revitalize" SOEs and "recapitalize" state banks will not do the job as long as majority ownership remains in the hands of government officials. Investment decisions will be politicized and capital will not go to its highest valued uses. Corruption will continue and wealth will be squandered as special interests vie for political favors. Although the pace of economic reform will depend to a large extent on political reform, a sound understanding of the importance of private property rights for the future of capital markets in China is an essential first step toward reform.
China's Pension Crisis
Table 1 summarizes the key data illustrating the problems confronting China's PAYG pension system. The old-age dependency ratio (i.e., the number of people who are age 65 or older relative to those age 15 to 64) will increase from 11 percent in 2005 to 25 percent in 2030 and 39 percent by midcentury. Meanwhile, the system dependency ratio (that is, the number of pensioners supported by each worker paying into the system) will increase from 35 percent in 2005 to 53 percent in 2030 and 69 percent by 2050 (Figure 1). In other words, less than 3 workers will be supporting each retiree in 2005, less than 2 by 2030, and less than 1.5 by midcentury.
The more immediate problem is that there is a negative cash flow in the pension system that will increase significantly over the next several decades (Figure 2). In 2005 the deficit is expected to be nearly RMB 50 billion (in constant 2000 yuan) or nearly $6 billion ($1 = RMB 8.28). By 2030 the deficit will reach RMB 630 billion ($76 billion), and by 2050 nearly RMB 1.5 trillion ($181 billion). Without reform the accumulated reserves in the current pension system will be - RMB 123 billion in 2005 (in constant 2000 yuan), increasing to - RMB 8.6 trillion in 2030 and - RMB 41 trillion in 2050. To balance the system, payroll tax rates would have to rise dramatically from 27 percent in 2005 to 45 percent in 2030 and nearly 60 percent in 2050
CATO JOURNAL
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TABLE
1
CHINA'S PENSION CRISIS Year 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Dependency Ratios (%)
Old-age dependency ratio (65+/15-64) 10.6 11.4 12.4 14.5 18.2 21.0 25.3 31.5 36.6 38.1 39.2
System dependency ratio 35.4 35.1 36.2 38.6 43.0 48.7 53.0 56.0 59.9 65.1 69.2
Financial
Conditions
(RMB 10 billion, in 2000 yuan) Revenue 17.2 25.8 36.3 43.5 50.3 56.9 63.9 71.3 78.5 84.3 90.1
Expenditure 21.2 30.6 42.9 58.7 78.3 102.5 126.9 149.4 174.0 203.1 235.3
Annual balance −4.0 −4.8 −6.6 −15.1 −28.0 −45.6 −63.0 −78.1 −95.5 −118.8 −145.2
Accumulated res. 9.7 −12.3 −45.9 −111.7 −245.9 −484.2 −860.1 −1,384.0 −2,070.2 −2,966.1 −4,126.3
Bal. Contrib. Rate (%) 28.0 27.0 27.0 30.7 35.5 41.1 45.3 47.8 50.5 54.9 59.5 NOTE: RMB 8.28
=
$1. SOURCE: Wang et al. (2004: Table 5).
PENSION REFORM IN CHINA
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FIGURE 1
A RISING DEPENDENCY RATIO IN CHINA'S PENSION SYSTEM (RETIREES PER WORKER, %) SOURCE: Wang et al. (2004: Table 5). FIGURE 2 PROJECTED DEFICITS IN CHINA'S PENSION SYSTEM (RMB 10 BILLION, IN 2000 YUAN) SOURCE: Wang et al. (2004: Table 5).
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(Wang et al. 2004: Table 5). Such increases would cripple economic growth.
Another useful measure of the system's financial condition is the implicit pension debt (IPD)--that is, the present value of all future benefits promised to current retirees and to those still in the work force who have paid into the system, assuming the PAYG system is immediately terminated (World Bank 1997: 33).1 Wang et al. (2004: Table 6) estimate that China's IPD is about RMB 4.4 trillion (in constant 2000 yuan) or 48 percent of gross domestic product (GDP). They assume that the old system ended in 2000, public institutions and government workers are excluded, and the discount rate is 4.5 percent. They also assume that the old pension regime was a pure PAYG system because most of the individual accounts set up as part of the multi-pillar system announced in 1997 were not funded. Indeed, they are notional and contain no real assets. Finally, the authors assume that the payroll tax rate is 24 percent and that the replacementrate is 60 percent. When public institutions and government workers are included, the IPD increases to nearly 64 percent of GDP. The above data paint a very bleak picture of the present system. As Wang et al. (2004: 120) conclude, "Our baseline calibration confirms that the current PAYG system is not financially sustainable and that its high annual deficit threatens China's fiscal stability." Even if benefits were reduced and the retirement age increased, the system would still not be viable because payroll taxes would have to be increased dramatically. Fundamental, not piecemeal, reform is necessary.
Empowering Workers
Before leaving office, Premier Zhu Rongji argued that pension reform is "the lifeline of our workers . . . and we absolutely can't allow any payment delays or embezzlement of the funds" (Hutzler andLeggett 2001: A10). For that reason he recommended that retirement funds be professionally managed and workers be given a wider range of investment options. Moving from a PAYG system to a fully funded system in which workers have property rights in their retirement accounts is clearly consistent with the socialist ideal of empowering workers (Pin~ era 1998).
Zhao and Xu (2002) calculate what it would cost to end the old system and move to a fully funded system that would achieve the 1If the PAYG system were terminated immediately and individuals were all on the new fully funded system, no payroll contributions would go to the old system; all contributions would be invested in the private retirement accounts. Hence, with no contributions to the old system from payroll, all promised benefits under the old system would be unfunded liabilities.
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same replacement rate as the current PAYG regime.2 They estimate that the annual cost of paying off the IPD over a 50-year period would be 1 percent of GDP or 5.6 percent of payroll, assuming the economy grows by 4 percent per year. Thus, if the old system were terminated, the cost of funding benefits promised to current and future retirees would only be 5.6 percent of payroll compared with the 24 percent tax rate needed to fund current retirees under the PAYG system. In addition, if one assumes that (1) the real rate of return on investment under the fully funded system is 6 percent (a reasonable assumption given the high rates of growth in the nonstate sector), (2) wages grow by 4 percent per year, and (3) workers contribute to their individual accounts for 40 years, retire at age 60, and live to age 75, then the new system could achieve a 60 percent replacement rate with an annual contribution equal to 10.2 percent of payroll--compared with the current rate of 24 percent. China could therefore pay off its pension debt and fund a private system with a total contribution rate of only 15.8 percent of payroll (Zhao and Xu 2002: 406-12).
It is important to recognize that the above calculation for the fully funded system holds if and only if workers' contributions to their individual accounts remain invested and if workers can earn competitive rates of return. Consequently, to be successful, pension reform must be accompanied by capital freedom--workers must be free to choose among an array of investment options, including investing in the private sector and in foreign markets. Moreover, private pension fund management is essential if the retirement accounts are to be free of political interference. With those conditions satisfied, workers should be able to earn at least 6 percent on their investments, according to Zhao and Xu (2002: 407).
If all the above assumptions hold, then workers in the nonstate sector who have no incentive to enter the PAYG system (or the multitier system with notional accounts) will find the new system attractive. Their broad participation would make the lower contribution rates possible (Zhao and Xu 2002: 411). Moreover, if SOEs and state-owned banks were privatized, the proceeds could be used to fund the transition and give workers new investment opportunities. 2The present system can be characterized as a multi-pillar pension system, similar to that proposed by the World Bank (1997), with a public PAYG pillar funded by a 13 percent payroll tax levied on enterprises; a fully funded pillar with individual accounts financed by a combined worker-employer payroll tax of 11 percent; and a voluntary pillar similar to an Individual Retirement Account. However, since the mandatory individual accounts are notional, Zhao and Xu (2002: 399-400), like Wang et al. (2004), treat the current system as a PAYG system financed by a payroll tax of 24 percent and having a replacement rate of 60percent.
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The sale of state assets would also allow authorities to lower the payroll tax needed to finance the new system and fund the IPD.3 If a broad-based tax were substituted for the payroll tax, rates could be even lower with further gains in efficiency. Finally, the transition period of 50 years could be reduced if workers were given recognition bonds representing their promised benefits under the old system and payable at retirement (Zhao and Xu 2002: 408-9).4 The longer China waits to move toward a fully funded system, the more costly that transition will be (World Bank 1997: 33). In 2001, the State Council sanctioned the Liaoning experiment intended to increase the use of "social pooling" and to create a firewall between the PAYG pillar and individual accounts. A National Social Security Fund was also established. But little progress has been made. Assets allocated to the individual accounts have been used to pay current retirees, and the plan to fund the NSSF through the sale of SOE shares never materialized.5
Workers will not become empowered until they have full rights to their pension funds. Privatizing the pension system would create new wealth that stays with the workers and could be left to family members or others. Workers would no longer be tied to their firms or be wards of the state upon retirement. The private sector would grow as SOE holdings were reduced and new savings and investment poured into the productive sector of the economy. To achieve those results, China will have to honor its commitment to the World Trade Organization to allow foreign banks to compete fully with state-owned banks by 2007, liberalize interest rates, open capital markets, respect private property rights, and depoliticize banking and commerce. In December 2003, the Standing Committee of the National People's Congress approved a constitutional amendment to give greater 3If the sale of state assets reduced the IPD to 40 percent of GDP, a tax rate of 0.8 percent of GDP would be sufficient to pay off the IPD over a 50-year period (Zhao and Xu 2002: 410).
4The transition time could be reduced to 40 years by giving all workers in the old system recognition bonds--with the last bonds coming due exactly 40 years after the PAYG system was ended--compared with a 50-year transition period when the IPD is financed by taxes. If the IPD were financed with long-term government bonds (debt), the transition period would increase. Zhao and Xu (2002: 405, 409) believe that debt financing is not politically feasible because of the decentralized nature of China's fiscal system. Li and Li (2003), however, favor debt financing.
5In June 2001, a plan was introduced whereby 10 percent of the proceeds from the sale of SOEs' nontradable shares and from IPOs (initial public offerings) would be earmarked for the NSSF, but that plan was discontinued (Kynge and McGregor 2001: 14; Zhao and Xu 2002: 412).
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security to private property. The NPC formally adopted that amendment in March 2004, making a "citizen's lawful private property. . . inviolable." Premier Wen Jiabao has pledged to "unswervingly encourage, support and guide the development of the nonpublic sector." He told the Washington Post in November 2003 that protecting private property will "give greater scope to the creativity and enterprising spirit of the Chinese population and will in the end help us achieve the goal of common prosperity" (Goodman 2003: A1). The great Chinese sage Lao Tzu reached a similar conclusion long ago when he said that when the ruler takes "no action," "the people of themselves become prosperous" (Chan 1963: 167). The principle of nonintervention or wu wei does not mean that government should do nothing but rather that it should take "no action that is contrary to Nature" (Chan 1963: 136). Wu wei, therefore, is "the embodiment of suppleness, simplicity, and freedom" (Smith 1991: 208). Although Lao Tzu had no vision of a liberal constitutional order of freedom based on private property, his vision of a spontaneous social order isconsistent with classical liberalism (Dorn 1998, 2003).
Private Property, Freedom, and Prosperity
Establishing a fully funded pension system in China giving workers private property rights to their pension funds would increase economic freedom and prosperity, just as it did in Chile (Pin~ era 1998). As Jacobo Rodr??guez (1999: 2) writes, "Chile has created a retirement system that, by giving workers clearly defined property rights in their pension contributions, offers proper work and investment incentives; acts as an engine of, not an impediment to, economic growth; and enhances personal freedom and dignity."
Peking University economist Yaohui Zhao (2001: 1) argues:
The best alternative in solving the financial crisis is to give individuals incentives to participate. The best way to give incentives to individuals is to put all pension contributions (from both employer and employee) into individual accounts and make sure that theinvestment earns competitive returns. This gives individuals the property rights to these accounts.
Once workers' rights to their pensions are privatized and secure, they will have greater freedom and a brighter future than under the present politicized pension system. Moreover, under a private, fully funded system, demographic issues become irrelevant. The performance
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of the pension funds depends solely on the strength of the economy and the investment portfolio, not on the aging of the population. Retirees are no longer supported by workers; there is no intergenerational redistribution of income. A new culture emerges in which the overriding aim of economic policy must be to safeguard property rights and "do no harm"--that is, a policy devoted to enhancing economic freedom and prosperity. Depoliticizing pensions means that workers will no longer have to depend on government for their retirement income. Individuals, asprivate owners of their pensions, will be responsible for their future. A culture of freedom will replace the old parasitic culture of dependency; a new constituency will be created in support of limited government and economic freedom. Jos? Pin~ era, the architect of the Chilean privatization program, is correct when he says, "The world would be a better place if every worker were also an owner of capital" (Pin~ era 2001: 1).
Opponents of privatization often argue that it increases risk and that a government PAYG system reduces risk. But it is important to recognize that a PAYG system is not risk free. Demographic changes and political pressures to increase benefits run the risk of creating large deficits in the system. Privatization eliminates those risks but introduces market-risk factors. However, if individuals have access to competitive domestic and international capital markets, they can diversify their portfolios and limit their risk exposure. Some people will select higher risk exposure to try to obtain higher returns, but if they know that there will be no government bailout if they fail to achieve the high returns, they are more likely to be conservative than reckless. After all, they are risking their own, not taxpayer, money.
To overcome the fear of markets, people need to appreciate theirsignificance. The market is a network of trust relationships cemented by private property rights and freedom of contract. To the extent those institutions are weakened, the market price system will be distorted and resources will be allocated more by political than by market forces. The value of property rights depends on the scope and enforcement of those rights, especially on the ease of selling property rights and on the rewards one expects to capture from exercising those rights. Any attenuation of private property rights reduces trust and liquidity as reflected in lower market prices. As Ricardo Guajardo, CEO of Bancomer-BBVA, noted at a recent Cato Institute conference in Mexico City (October 24, 2001), investors are "looking for trust and certainty," which means "property rights should be bulletproof."
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By failing to establish the institutional infrastructure necessary for creating a vibrant private capital market, China is denying itself the chance to create new liquidity and wealth. It is a mistake to think that imposing capital controls and limiting investment opportunities is in China's long-run interest. A key lesson of the Asian financial crisis, according to Federal Reserve Board Chairman Alan Greenspan (1999: 10), is that
where a domestic financial system is not sufficiently robust, the consequences for a real economy of participating in this new, complex global system can be most unwelcome. Improving deficiencies in domestic banking systems in emerging markets will help to limit the toll of the next financial disturbance on their real economies. But if, as I presume, diversity within the financial sector provides insurance against a financial problem turning into economy-wide distress, then steps to foster the development of capital markets in those economies should also have an especial urgency. And thedifficult groundwork for building the necessary financial infrastructure--improved accounting standards, bankruptcy procedures, legal frameworks [to protect property rights] and disclosure--will pay dividends of their own.
Assets have little value if people do not have clear title and are not free to put them to their highest valued uses--that is, if there are no private property rights protected by law. As Hernando de Soto, author of The Mystery of Capital, notes, "Capital is that value, that additional value, that comes from things that are duly titled"; "capital is also law" (Fettig 2001: 23, 26). Countries are poor when their leaders prevent privatization and fail to abide by the rule of law. Hong Kong is rich not because it has abundant natural resources but because it has market-supporting institutions.
In a study of 150 countries, Lee Hoskins and Ana Eiras (2002) find that countries with stronger private property rights have created more wealth (as measured by real GDP per capita) than countries in which private property rights are attenuated and corruption is high (Figure 3). Likewise, James Gwartney and Robert Lawson (2002: 20) find a strong correlation between economic freedom (as measured by the economic freedom of the world index) and human welfare (as measured by per capita income, economic growth, and life expectancy). They also find that individuals with low incomes fare much better in countries with higher levels of economic freedom. Making private property rights bulletproof does matter. If China wants to revitalize its firms and banks--and solve the pension crisis--it must change ownership, not simply inject more funds into dying institutions.
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The Inseparability of Pension Reform and
Ownership Reform
Creating fully funded pensions should go hand-in-hand with privatizing state-owned enterprises and banks. China's socialist sector is bankrupt and should be allowed to wither away so that the dynamic private sector can grow to its full potential. If China wants real capital markets, then private property rights and freedom of contract must be safeguarded by the rule of law. Firms must be allowed to offer shares and those shares must be fully transferable.6 Likewise, banks must be put on a sound commercial basis so that they will have the flexibility to adjust quickly to market forces without prior political approval.
6Of course, firms must also adopt generally accepted accounting practices and meet certain financial standards in order to list their shares.
FIGURE 3
STRONGER PROPERTY RIGHTS CREATE GREATER WEALTH
SOURCE: Hoskins and Eiras (2002: 40).
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Trying to make socialist firms and banks act like private joint-stock companies without changing effective ownership is futile. Indeed, capital markets without widespread private ownership and fully transferable shares are an illusion (Nutter 1968). To be credible, asset (stock) prices must accurately reflect the capitalized values of companies-- that is, the discounted value of expected future profits. Product and factor prices must be freely determined to give an accurate profit picture, and interest rates must reflect consumers' time preferences and the productivity of capital to correctly calculate present values.
By failing to create real capital markets, China is failing to take advantage of the gains to be had from specializing in ownership and risk taking.7 The socialization of risk reduces incentives to innovate and to create wealth. The value of Chinese firms is below what it could be if capital were free to flow to its highest valued uses and if workers were free to own their pensions and to move their funds to where risk-adjusted returns were maximized. It is time for China to put its vast pool of private savings to better use than to bail out state enterprises and prop up state banks that continue to make loans to bankrupt firms.
China's Challenge
China has been willing to experiment with different ownership forms since 1978 but is still wedded to state ownership. Amending the PRC Constitution to make private property inviolable is an important step toward creating a culture of enterprise. With further liberalization, assuming China honors its commitments under the WTO, there will be an opportunity to spontaneously develop the institutions necessary for real capital markets. Foreign investors can play an important role in that development.
After a decade of reform, China's paramount leader Deng Xiaoping said, "The reform of the political structure and the reform of the economic structure are interdependent and should be coordinated. Without political reform, economic reform cannot succeed" (Deng 1987: 147-48). The challenge for China's new leaders will be to accommodate economic reform by relaxing the Communist Party's monopoly on power and to respect the natural rights of all individuals to life, liberty, and property. The first step is to recognize the importance 7For a discussion of the benefits from specialization in ownership and risk taking, see Alchian (1977: chap. 5).
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of property rights for China's future prosperity. Shanghai will never match New York or London or Hong Kong without allowing capital freedom.
China's leaders could learn much from the wisdom of Lao Tzu. Nonintervention worked well for Hong Kong, and it can work for China. Indeed, economic liberalization has more than quadrupled real per capita income in China since 1978. Further liberalization will yield additional gains in the battle to alleviate poverty. In particular, China needs to
* Remove restrictions on private ownership and protect property rights;
* Establish a fully funded pension system that empowers workers;
* Liberalize the financial sector and privatize SOEs and state banks;
* Allow full convertibility of the renminbi.
Once property rights are more secure and China's capital markets are liberalized, domestic and foreign investors will have more options and the private sector will have greater opportunities to grow. Moreover,if Greenspan is right, China's financial markets should be better able to weather a crisis.
Privatizing China's pension system would be a giant step in the right direction. A larger privatization program, however, must accompany that step if China is to realize its full potential.
References
Alchian, A. A. (1977) "Some Economics of Property Rights." In Alchian, Economic Forces at Work, chap. 5. Indianapolis: Liberty Press.
Chan, W. -T. (1963) A Source Book in Chinese Philosophy. Princeton, N.J.: Princeton University Press.
Deng, X. (1987) Fundamental Issues in Present-Day China. Translated by the Bureau for the Compilation and Translation of Works of Marx, Engels, Lenin, and Stalin under the Central Committee of the Communist Party of China. Beijing: Foreign Languages Press.
Dorn, J. A. (1998) "China's Future: Market Socialism or Market Taoism?" Cato Journal 18 (1): 131-46.
(2003) "The Primacy of Property in a Liberal Constitutional Order: Lessons for China." The Independent Review 7 (4) (Spring): 485-501.
Fettig, D. (2001) "An Interview with Hernando de Soto." The Region 15 (June): 20-31. Published by the Federal Reserve Bank of Minneapolis (www.minneapolisfed.org).
Goodman, P. S. (2003) "China's Leaders Back Private Property." Washington Post, 23 December: A1. Greenspan, A. (1999) "Lessons from the Global Crises." Remarks before the
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World Bank Group and the International Monetary Fund Program of Seminars. Washington, D.C., 27 September.
Gwartney, J., and Lawson, R. (2002) Economic Freedom of the World: 2002 Annual Report. Vancouver, B.C.: Fraser Institute.
Hoskins, L., and Eiras, A. I. (2002) "Property Rights: The Key to Economic Growth." In G. P. O'Driscoll Jr.; K. R. Holmes; and M. A. O'Grady (eds.) 2002 Index of Economic Freedom, 37-48. Washington and New York: Heritage Foundation and Wall Street Journal.
Hutzler, C., and Leggett, K. (2001) "For China's Premier Zhu, a Critical Home Stretch." Wall Street Journal, 29 August: A6, A10.
Kynge, J., and McGregor, R. (2001) "Stability to the People." Financial Times, 26 October: 14.
Li, D. D., and Li, L. (2003) "A Simple Solution to China's Pension Crisis." Cato Journal 23 (2): 281-89.
Nutter, G. W. (1968) "Markets without Property: A Grand Illusion." In N. Beadles and A. Drewry (eds.) Money, the Market, and the State. Athens: University of Georgia Press.
Pin~ era, J. (1998) "Empowering People: What China Can Learn from Chile." In J. A. Dorn (ed.) China in the New Millennium: Market Reforms and Social Development, 305-17. Washington: Cato Institute.
(2001) "Liberating Workers: The World Pension Revolution." Cato's Letter No. 15. Washington: Cato Institute.
Rodr??guez, L. J. (1999) "Chile's Private Pension System at 18: Its Current State and Future Challenges." The Cato Project on Social Security Privatization. SSP No. 17 (30 July). Washington: Cato Institute.
Smith, H. (1991) The World's Religions. Rev. and updated ed. San Francisco: HarperSanFrancisco.
Wang, Y.; Xu, D.; Wang, Z.; and Zhai, F. (2004) "Options and Impact of China's Pension Reform: A Computable General Equilibrium Analysis."Journal of Comparative Economics 32 (March): 105-27.
World Bank (1997) Old Age Security: Pension Reform in China. China 2020Series. Washington: World Bank.
Zhao, Y. (2001) "The Feasibility and Benefits of a Fully Funded PensionSystem." Working paper, Peking University, September.
Zhao, Y., and Xu, J. (2002) "China's Urban Pension System: Reforms andProblems." Cato Journal 21 (3): 395-414.
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